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One Stop Warehouse Pty Ltd v Reed

One Stop Warehouse Pty Ltd v Reed

Case [2023] WASC 177 19 May 2023

Contract Formation

Implied Terms

Unconscionable Conduct

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JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   ONE STOP WAREHOUSE PTY LTD -v- REED [2023] WASC 177
CORAM:   SEAWARD J
HEARD:   19 MAY 2023
DELIVERED          :   19 MAY 2023
PUBLISHED           :   24 MAY 2023
FILE NO/S:   CIV 1441 of 2023
BETWEEN:   ONE STOP WAREHOUSE PTY LTD
Plaintiff
AND
ROBERT REED
First Defendant
GO SOLAR GROUP PTY LTD
Second Defendant

Catchwords:

Interlocutory injunction - Restraint of trade - Employment contract - Non‑solicitation and non-compete restraints - Employee resigning and entering employment contract with competitor of former employer - Whether interlocutory injunction should be granted - Whether restraint reasonable - Balance of convenience - Delay in bringing application - Serious questions to be tried

Legislation:

Nil

Result:

Application for interlocutory injunction dismissed

Category: B

Representation:

Counsel:

Plaintiff	:	FA Stanton
First Defendant	:	ND Ellery
Second Defendant	:	ND Ellery

Solicitors:

Plaintiff	:	Minter Ellison
First Defendant	:	Hall & Wilcox (Perth)
Second Defendant	:	Hall & Wilcox (Perth)

Case(s) referred to in decision(s):

Emission Assessments Pty Ltd v James Jackson [2022] WASC 60
Habitat 1 Pty Ltd v Formby [No 2] [2017] WASC 331
Mineralogy Pty Ltd v Sino Iron Pty Ltd [2016] WASCA 105
Nutrien AG Solutions Ltd v Andrews [2023] WASC 96
Portal Software International Pty Ltd v Bodworth [2005] NSWSC 1179
Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 2] (2017) 55 WAR 36
Smith v Nomad Modular Building Pty Ltd [2007] WASCA 169
Twinside Pty Ltd v Venetian Nominees Pty Ltd [2008] WASC 110
Workplace Access and Safety Pty Ltd v Mackie [2014] WASC 62

SEAWARD J:

Introduction

The plaintiff, One Stop Warehouse Pty Ltd (OSW), carries on business as a wholesaler of solar panels and related equipment. OSW's customers are companies engaged in the retail sale of those products, including electricians.
The first defendant, Mr Reed, commenced working for OSW on 16 July 2018 as a Sales Account Manager. In August 2020, Mr Reed was promoted to the position of Senior Account Manager and in January 2022 Mr Reed was promoted to the position of Lead Account Manager, in which he was responsible for all sales in Western Australia and for the management of the Western Australian sales team.
On 27 January 2023, Mr Reed tendered his resignation from OSW and the last day of his employment was 24 February 2023.
On or about 2 March 2023, Mr Reed commenced working for the second defendant, Go Solar Group Pty Ltd (Go Solar). Like OSW, Go Solar is a wholesaler of solar panels and related equipment and is therefore a competitor of OSW.
On 11 May 2023, OSW filed its application for urgent injunctive relief to restrain Mr Reed from working for Go Solar and to enforce what it says are the contractual restraint of trade clauses to which Mr Reed is subject.
The matter was originally listed for hearing on 16 May 2023. At that hearing the defendants had not filed any substantive affidavit evidence in response…

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 Stop Warehouse Pty Ltd v Reed

Details

AGLC: One Stop Warehouse Pty Ltd v Reed [2023] WASC 177
Case: [2023] WASC 177
Decision Date

CaseChat Overview and Summary

One Stop Warehouse Pty Ltd (OSW) sought an interlocutory injunction to restrain Mr Robert Reed from working for Go Solar Group Pty Ltd (Go Solar) and to enforce what it says are the contractual restraint of trade clauses to which Mr Reed is subject. Mr Reed had resigned from OSW on 27 January 2023 and commenced working for Go Solar on 2 March 2023. OSW filed its application for urgent injunctive relief on 11 May 2023. The application was heard on 19 May 2023. The court refused the plaintiff's application for an interlocutory injunction. The court found that although OSW had established a serious question to be tried as to whether the restraint clauses were reasonable and necessary for the adequate protection of OSW's interests, the strength of OSW's case as to a 12 month and/or a six month restraint was weaker. The court also found that the balance of convenience did not favour the grant of an interlocutory injunction. The court found that the delay in bringing the application was significant, that Mr Reed had already been working for Go Solar for almost 2.5 months, and that OSW had had the opportunity to seek a replacement for Mr Reed. The court also found that the harm that would be caused to Mr Reed if the injunction were granted outweighed the harm that would be caused to OSW if the injunction were not granted. The court ordered that the matter be admitted to the Commercial and Managed Cases List and listed for a case management hearing on 1 June 2023.

Orders