Russ Australia v Benny

Russ Australia lodged an application against Benny, its former employee, alleging breaches of restrictive covenants in his employment contract. The contract contained a clause prohibiting Benny from working for a competitor in Australia for a period of 12 months after the termination of his employment. The contract also contained a clause prohibiting Benny from soliciting Russ Australia's clients for a period of 12 months. The dispute came before the Federal Circuit Court, which was required to determine whether the restrictive covenants were valid and enforceable. The court needed to consider whether the covenants went further than was necessary to protect Russ Australia's legitimate business interests and whether a particular threat of breach had been established. The court also needed to consider whether the covenant not to work for a competitor was reasonable in its duration and scope.

The court held that the covenant not to work for a competitor was valid and enforceable, as it was reasonable in its duration and scope. The court found that there were legitimate business interests capable of supporting such a covenant, and that the period of 12 months was not excessive. The court held that the covenant not to solicit clients was also valid and enforceable, as it was reasonable in its duration and scope. The court found that the covenant was necessary to protect Russ Australia's legitimate business interests and that the period of 12 months was not excessive. The court also held that an interlocutory hearing would, for practical purposes, decide the rights of the parties. The court found that the balance of convenience favoured the grant of interlocutory relief, as Benny's breach of the restrictive covenants would cause significant harm to Russ Australia's business interests.

The court granted an interlocutory injunction restraining Benny from working for a competitor in Australia for a period of 12 months and from soliciting Russ Australia's clients for a period of 12 months. The court found that the factors relevant to the balance of convenience favoured the grant of interlocutory relief, as the harm caused to Russ Australia's business interests outweighed any harm that might be caused to Benny. The court also found that Benny's breach of the restrictive covenants would constitute an interference with contractual relations, which was a tort for which damages could be claimed.