Walter v Jong

In *Walter v Jong* [1997] NSWCA 333, the New South Wales Court of Appeal considered a dispute between the appellant, Walter, and the respondent, Jong, concerning the interpretation and enforceability of a written agreement. The agreement in question related to the sale of a business and contained a restraint of trade clause.

The primary legal issue before the Court of Appeal was whether the restraint of trade clause within the agreement was reasonable and therefore enforceable. This required the Court to assess the scope of the restraint, including its geographical reach and duration, in light of the legitimate interests of the vendor and the potential impact on the purchaser and the public.

The Court applied established principles of contract law concerning restraints of trade. It considered whether the restraint went no further than was necessary to protect the proprietary interests of the purchaser, such as goodwill and trade connections, and whether it unduly restricted competition. The Court analysed the specific terms of the clause in the context of the business being sold and the circumstances surrounding the agreement's formation.

Ultimately, the Court of Appeal found that the restraint of trade clause was unreasonable and therefore void. The Court ordered that the appeal be dismissed.