Structerre Consulting Engineers (NSW) Pty Ltd v Townend

In the case of Structerre Consulting Engineers (NSW) Pty Ltd v Townend, the plaintiff sought relief from an undertaking provided by the defendant, who was their former employee. The primary issue was whether the employee should be released from the restraint of trade provision contained within the undertaking. The Federal Circuit and Family Court of Australia was tasked with determining the validity and enforceability of the restraint of trade clause in light of its inherent indefiniteness.

The court was required to decide if the restraint of trade clause in the undertaking was valid and enforceable, particularly given its indefinite nature. Additionally, the court had to consider whether it was appropriate to allow for a replacement undertaking to be given, thereby providing a more defined and enforceable restraint of trade clause.

The court found that the restraint of trade clause in the undertaking was inherently indefinite, which rendered it unenforceable. Despite this, the court was of the opinion that it was appropriate to allow the parties to negotiate and provide a replacement undertaking. This replacement would need to be more clearly defined and enforceable to adequately protect the interests of the employer while also ensuring that the restraint was not overly burdensome on the employee. The court concluded that a tailored and specific restraint of trade clause could be more appropriate in ensuring both parties' interests were appropriately protected.

As a result of the court's decision, the employee was released from the original undertaking. The court directed the parties to negotiate and provide a replacement undertaking that was more clearly defined and enforceable. The court's ruling balanced the need for the employer to protect their business interests with the need to ensure the employee was not unduly restricted in their future employment opportunities.