Serco Australia Pty Ltd v Christopher William Manning
[2012] ACTSC 186
•19 December 2012
SERCO AUSTRALIA PTY LTD v CHRISTOPHER WILLIAM MANNING
[2012] ACTSC 186 (19 December 2012)
EMPLOYMENT LAW – asserted breach by employee of restraint clause in deed of release on termination of employment – defendant accepting employment offer from competitor – whether breach of agreement – whether damages adequate remedy – relevance of delay until final hearing of action – application for interlocutory injunction refused
No. SC 341 of 2012
Judge: Master Harper
Supreme Court of the ACT
Date: 19 December 2012
IN THE SUPREME COURT OF THE )
) No. SC 341 of 2012
AUSTRALIAN CAPITAL TERRITORY )
BETWEEN:SERCO AUSTRALIA PTY LTD (ACN 003 677 352)
Plaintiff
AND:CHRISTOPHER WILLIAM MANNING
Defendant
ORDER
Judge: Master Harper
Date: 19 December 2012
Place: Canberra
THE COURT ORDERS THAT:
the plaintiff’s application in proceeding dated 18 October 2012 be dismissed.
This is an application by the plaintiff for an interlocutory injunction restraining the defendant until the determination of the proceedings from, for practical purposes, working as an employee of G4S Australia Pty Ltd, G4S New Zealand Ltd, or any company related to those companies.
The proceedings were commenced by originating application on 18 October 2012. I heard the present application on 26 October 2012. At that time, the reasonable expectation was that there might have been a delay of at least a year and perhaps two years before an action of this kind was reached in the ordinary course of events and heard. In the event, the court has been able to find time to hear the substantive action on 4 February 2013, and the hearing will take place commencing on that date before Burns J.
A brief summary of the factual assertions in the statement of claim is as follows: the plaintiff is a company incorporated in Australia which operated, under contractual arrangements with the Department of Immigration and Citizenship of the Commonwealth, immigration detention centres and other immigration facilities, and provides immigration residential housing and transit accommodation in Australia and its territories. The plaintiff company is a member of the Serco Group, with its headquarters in the United Kingdom, the ultimate holding company being Serco Group plc. Serco entered contracts with the Commonwealth during 2009.
The plaintiff asserts that the defendant was seconded in March 2011 by Serco Group plc to Serco Australia as acting managing director, immigration services. From 1 February 2012 he was employed as managing director, immigration services. The terms of his employment were set out in a letter of appointment dated 10 January 2012. He had in that position overall responsibility for managing, implementing and delivering Serco Australia’s obligations under its contract with the Commonwealth. His responsibilities included the development and growth of Serco Australia’s business. He represented Serco Australia in its dealings with the Immigration Department, and was the Department’s principal point of contact with Serco Australia. He had frequent and continuing communications with departmental officers at the highest level. By reason of this, he came to be well and favourably regarded by officers of the Department, and seen as the persona of Serco Australia in relation to its contract with the Commonwealth. He was, it was alleged, able to exert, and did exert, influence over departmental officers.
It was further asserted that in that position, the defendant was a member of Serco Australia’s senior executive team and had access to, and detailed knowledge of, confidential information including strategy documents, operational information, marketing information, growth strategies, financial information and other similar information.
It was then asserted that on 18 April 2012 the plaintiff and the defendant entered a deed of release whereby the defendant’s employment would cease. He agreed, after an opportunity to obtain legal advice and after obtaining such advice, that he would not, for twelve months from 1 May 2012 in Australia without the prior consent of the plaintiff, directly or indirectly: canvass, solicit or accept an approach from a client or customer of Serco for competing or similar business; provide services of a similar nature to a client or customer of Serco Australia, or assist anyone else to do such a thing. The statement of claim asserted that the Commonwealth Immigration Department was a client and customer of Serco for the purposes of the deed of release. The plaintiff’s employment with Serco Australia ceased on 1 May 2012.
On about 24 September 2012, the defendant started employment with G4S Australia Pty Ltd, a company engaged in the same field and competing with the plaintiff. His first position was as project change manager of secure solutions.
On 28 September 2012 the Immigration Department issued to various entities including the plaintiff and G4S a request for expressions of interest to provide services in relation to intending immigrants at Manus Island in Papua New Guinea. It is asserted that the defendant assisted G4S with its expression of interest documents, in which he was named as manager for the Manus Island project and contact person for G4S. G4S was successful in its bid to provide these services. The defendant came to Canberra on 5 October 2012 with other representatives of G4S to meet with officers of the Department. Since then G4S has been providing contractual services to the Department on Manus Island, and the defendant has been the manager and contact person on Manus Island for the project. The plaintiff asserts that the services provided by G4S are “the same or similar services” within the deed of release.
The plaintiff says that in the circumstances the defendant has breached the deed of release and it can be expected that he will continue to do so unless restrained. The plaintiff, it is said, has suffered and will continue to suffer loss and damages as a result.
I am satisfied on the evidence that the facts asserted in the statement of claim are broadly true. I recognise that Manus Island is not in Australia and is part of Papua New Guinea, a separate and independent nation.
I take judicial notice of the fact that the services being provided contractually by G4S to the Immigration Department of the Commonwealth are of significance to the Commonwealth, and that there are by now a relatively significant number of asylum seekers in detention at Manus Island who wish to apply for admission to Australia as refugees. The evidence is that G4S is managing the operation on Manus Island, something the plaintiff did not lodge an expression of interest to do. I accept on the evidence that the defendant is a person of great importance to the successful operation by G4S of the facilities on Manus Island.
The outlook has changed significantly as a result of the Court’s capacity to offer the parties an early date for the hearing of the action. There are a number of factors I focus on in exercising my discretion as to the interlocutory restraint sought. The first is that it would be for a relatively short time, as things now stand. The second is that to grant the injunction would be likely to cause an immediate negative effect to the operations of G4S. G4S is not a party to these proceedings and I am unable to conclude on the evidence before me that G4S deliberately placed the defendant in a situation where he might be influenced to commit a breach of contract. Having said that, the solicitors for the defendant have also appeared for G4S in relation to a dispute about production of documents on subpoena, and there is an irresistible inference that G4S is arranging the defendant’s legal representation in these proceedings.
Nevertheless, there is no basis for a conclusion that G4S has enticed the defendant away from the plaintiff, or that G4S has any intention of utilising the defendant’s services to enhance its relationship with the Commonwealth or the Immigration Department. There is no basis for a finding which goes any further than that G4S sees the plaintiff as the best available candidate to manage the Manus Island operation.
Accordingly, I conclude that the restraint sought would operate in a highly negative fashion against the interests of both G4S and the defendant, without any particular benefit to the plaintiff.
If the plaintiff succeeds in the action, it will be entitled to recover damages to be assessed on the evidence as to its present and potential losses. I am not satisfied that damages will be a less than adequate remedy in the event that the plaintiff is successful.
As I have said previously, the fact of an early hearing date is another factor militating against the grant of interlocutory relief.
For those reasons, the application for an interlocutory injunction will be refused.
Costs would normally follow the event but I shall give the parties an opportunity to be heard in case there are considerations relevant to costs of which I am unaware.
I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Master Harper.
Associate:
Date: 19 December 2012
Counsel for the plaintiff: Mr IM Neil SC and Mr AC Harding
Solicitor for the plaintiff: Gadens by their agents Goodman Law
Counsel for the defendant: Mr MD Wyles SC and Mr J Tracey
Solicitor for the defendant: Foster Nicholson Jones by their Canberra agents Meyer Vandenberg
Date of hearing: 26 October 2012
Date of decision: 19 December 2012
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