One Dream Enterprises Pty Ltd v Simmonds - [2019] VSC 304

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

EMPLOYMENT AND INDUSTRIAL LIST

S ECI 2019 01881

ONE DREAM ENTERPRISES PTY LTD (ACN 145 089 005) t/as YPA ESTATE AGENTS WERRIBEE

Plaintiff

MELANIE SIMMONDS

TONY VERCHER

JAMES RISOS

First Defendant

Second Defendant

Third Defendant

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JUDGE:	McDonald J
WHERE HELD:	Melbourne
DATE OF HEARING:	8 May 2019
DATE OF RULING:	8 May 2019
CASE MAY BE CITED AS:	One Dream Enterprises Pty Ltd v Simmonds & Ors
MEDIUM NEUTRAL CITATION:	[2019] VSC 304

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INJUNCTION – Defendants previously engaged by plaintiff – Application to restrain defendants from utilising confidential information of the plaintiff – Plaintiff established an arguable case – Balance of convenience strongly in favour of dismissing application.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Ms E Rothschild (solicitor)	Elisa Rothschild Lawyers
For the Defendants	Ms S M Kelly	Gilchrist Connell Pty Ltd

HIS HONOUR:

The plaintiff, One Dream Enterprises Pty Ltd (‘One Dream’), operates a real estate agency under the trading name YPA Estate Agents Werribee. The services which it offers include the marketing and sale of real estate and real estate management services.

Each of the defendants was previously employed by One Dream: Ms Simmonds, between 22 October 2013[1] and 25 August 2018;[2] Mr Vercher, between 7 May 2012[3] and 25 August 2018;[4] and Mr Risos, between 16 August 2016[5] and 17 October 2018.[6] Subsequent to the termination of their employment with One Dream, each of the defendants commenced employment with 500 Keys Pty Ltd (‘500 Keys’), a real estate agency trading as Hodges Werribee. This is a new business.
[1]Affidavit of James Antonio affirmed 30 April 2019, [9].
[2]Ibid [16].
[3]Ibid [8].
[4]Ibid [16].
[5]Ibid [10].
[6]Ibid [19].

It is not in dispute that during the period 17 October 2018 to 1 May 2019, One Dream has lost business to 500 Keys. That lost business comprises 14 landlords, with 36 properties under management,[7] and the sale of a property, at 33 Exploration Drive, Werribee (’33 Exploration Drive’).[8] In early 2018, One Dream had approximately 679 landlords on its rent roll.[9] The 14 landlords who have transferred their business to 500 Keys represent approximately two per cent of One Dream’s landlords as at the time 500 Keys commenced business.
[7]Ibid [42].
[8]Ibid [19]–[20].
[9]Ibid [5].

At the time of the termination of their employment, each of the defendants was employed by One Dream pursuant to a contract of employment which contained a clause dealing with the use of confidential information. That clause was cl 16 of each contract, and provided as follows:

Any trade, professional or other like information of a confidential nature gained by yourself during the course of your employment shall not, without the specific authority of One Dream Enterprises Pty Ltd. used to the detriment of One Dream Enterprises Pty. or to the advancement of a subsequent employer.
Without limiting the generality of the foregoing, all documents, records and reports, listings and information regarding landlords, tenants, vendors and…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading One Dream Enterprises Pty Ltd v Simmonds

Details

AGLC: One Dream Enterprises Pty Ltd v Simmonds [2019] VSC 304
Case: [2019] VSC 304
Decision Date: 8 May 2019

CaseChat Overview and Summary

One Dream Enterprises Pty Ltd brought a claim against Simmonds, seeking an injunction to prevent Simmonds from using confidential information obtained during their employment with the plaintiff. The case was heard in the Federal Circuit Court of Australia. The plaintiff argued that Simmonds had breached their fiduciary duty and misused confidential information by starting a competing business, thereby causing harm to One Dream Enterprises.

The legal issues the court needed to address were whether the plaintiff had established an arguable case for an injunction and whether the balance of convenience favoured granting the injunction. The court considered whether Simmonds had indeed misused confidential information and whether One Dream Enterprises was likely to suffer irreparable harm if the injunction was not granted. It was also necessary to weigh the potential prejudice to Simmonds against the benefit to One Dream Enterprises if the injunction was granted.

The court found that One Dream Enterprises had established an arguable case that Simmonds had misused confidential information. However, the court held that the balance of convenience strongly favoured dismissing the application for an injunction. The court noted that the proposed injunction would have a significant impact on Simmonds' ability to conduct their business, while the harm to One Dream Enterprises, while real, was not of such a nature that it could not be compensated by damages. Consequently, the court declined to grant the injunction.

The court's decision was based on a detailed analysis of the evidence presented and the principles of equity, particularly the need to balance the interests of both parties. The court ultimately concluded that the appropriate remedy for the breach of confidence was not an injunction but rather damages, which could be determined in a subsequent proceeding.

Orders