Smith v Nomad Modular Building Pty Ltd

[2008] HCATrans 113

[2008] HCATrans 113

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Perth  No P37 of 2007

B e t w e e n -

NEVILLE EDGAR SMITH

Applicant

and

NOMAD MODULAR BUILDING PTY LTD

Respondent

Application for special leave to appeal

Publication of reasons and pronouncement of orders

GUMMOW J
KIEFEL J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON FRIDAY, 29 FEBRUARY 2008, AT 9.49 AM

Copyright in the High Court of Australia

GUMMOW J:   The applicant was employed by the respondent as its general manager of manufacturing until 30 March 2007.  His contract of employment contained a restraint of trade clause which prohibited him from being engaged in any competing business in Queensland or Western Australia for six months thereafter.  This litigation was catalysed by the applicant taking steps to commence employment with a competitor of the respondent within the proscribed six month restraint period.

Master Sanderson of the Supreme Court of Western Australia granted an injunction to restrain the applicant from commencing employment with the competitor until expiration of the restraint period.  The Master held that the restraining clause was reasonable as between the parties and the public, that it protected a legitimate interest recognised at law and that the area of restraint and the time of restraint were also reasonable.  The legitimate interest identified by the Master was the protection of information confidential to the respondent which had come into the applicant’s possession in the course of his employment.

The applicant appealed the Master’s decision to the Court of Appeal.  In dismissing the appeal, McLure JA (with whom Buss JA agreed) and Pullin JA held that the respondent’s alleged subjective intention of retaining staff was irrelevant in determining the reasonableness of the restraining clause.  Their Honours concluded by reference to settled principles that it was open to find that the clause protected a legitimate interest and was reasonable in the circumstances.

The application in this Court does not establish sufficient bases to doubt the correctness of that conclusion.  There are insufficient prospects of success to justify a grant of special leave to appeal.  Special leave is refused.

Pursuant to r 41.11.1 we direct the Registrar to draw up, sign and seal an order dismissing the application for special leave with costs.  I publish the disposition signed by Justice Kiefel and myself.

AT 9.51 AM THE MATTER WAS CONCLUDED