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[2019] ZALCJHB 14
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Servest (Pty) Ltd t/a Servest Cleaning v Oelschig and Another (J4213/2018) [2019] ZALCJHB 14 (22 January 2019)
IN
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not
Reportable
Case
no: J4213/2018
In
the matter between:
SERVEST
(PTY) LTD t/a SERVEST
CLEANING Applicant
and
OELSCHIG
PAUL
ARNOLD First
Respondent
BIDVEST
SERVICES (PTY) LTD t/a
BIDVEST
PRESTIGE Second
Respondent
Heard:
13 & 19 December 2018
Delivered:
22 January 2019
JUDGMENT
TLHOTLHALEMAJE,
J:
Introduction:
[1]
The applicant seeks to enforce certain confidentiality and restraint
of trade undertakings contained in the employment contract
entered
with the first respondent. These undertakings were made as per the
first respondent’s letter of appointment, and
the Restraint of
Trade and Confidentiality Agreement.
[2]
The application is opposed by the first respondent. At the first
sitting of the proceedings, the Court had suggested to the
parties to
make attempts to resolve the matter in the light of the limited
issues that were placed in dispute. By way of background,
it was
common cause that;
2.1 The first respondent was employed
by the applicant as a Key Accounts Executive in November 2013.
He was subsequently promoted
to the position of National Business
Development Manager. He resigned from the applicant’s
employment on 3 September 2018.
2.2 Clause 2 of the first respondent’s
letter of appointment makes provision for undertakings in regards to
the applicant’s
confidential information. More extensive
provisions in that regard are to be found in clauses 3 and 4 of the
parties’ Restraint
of Trade and Confidentiality Agreement. The
duration of the restraint of trade and confidentiality agreement is
24 months, and
is enforceable throughout the Republic of South
Africa.
2.3 The first respondent is
essentially restrained, whether for himself or as an agent of anyone
else, from persuading, inducing,
soliciting, encouraging or procuring
any
current or prospective clients
of the applicant to be
enticed away from it or the business of any of its
current or
prospective
clients.
2.4 The restraint provisions however
do not specifically prohibit the first respondent from joining a
competitor.
2.5 The first respondent joined the
second respondent, a competitor of the applicant, as Business
Development Manager after his
resignation.
[3]
Central to the dispute insofar as certain undertakings have been made
by the first respondent, and further in the light of the
limited
issues in dispute, is what is the appropriate order to be granted. On
13 December 2018, the parties presented
two draft orders to
the Court for its consideration. The difference appears to be in
respect of a list of the applicant’s
clients, whether such a
list should include both prospective and current clients, and where
the list should be kept for the duration
of the restraint period. A
further fundamental difference related to the issue of which party
ought to be burdened with the costs
of this application.
[4]
An order was then made on 13 December 2018 in terms of
which the matter was postponed to 19 December 2018
in order
for the applicant to deliver a list of its actual and prospective
customers, and further for the first respondent accompanied
by his
attorneys to inspect the list, but not to make copies. The parties
had complied with the Court’s order, but when the
matter
resumed on 19 December 2018, they still could not agree on
the appropriate order to be granted having regard to
the submitted
list of actual and prospective customers and as further
inspected by the first respondent.
[5]
The main area of contention was in regards to the list of clients
(current and prospective), which was made available following
the
Court order of 13 December 2018, and where that list should
be kept. The applicant sought an order in terms of which
its
attorneys were to retain the list in their possession, for a period
of 12 months from 3 September 2018, whilst the
first
respondent on the other hand sought an order in terms of which his
attorneys would be provided with that list.
[6]
The applicant had presented the Court with two draft orders in the
light of the differences in approach and the appropriate
order to be
made. Having had regard to the two draft orders submitted on behalf
of the applicant, and the initial draft order submitted
on behalf of
the first respondent, it is my view that given the similarities and
differences in the draft orders, no purpose would
be served by
dealing extensively with the merits of the application.
[7]
In further coming to a conclusion as to which draft order should be
made an order of court, it is taken into account that the
only issue
in dispute insofar as the restraint and confidentiality undertakings
are concerned, pertains to whether there was in
fact a breach of
those undertakings, which issue I intend to deal with in the context
of a determination of a costs order, which
was also a contentious
issue between the parties.
[8]
In the light of the above, of all the draft orders presented, the
draft order submitted on behalf of the applicant marked “X”
as attached to its written heads of argument, represents the
restraint undertakings as contained in the first respondent’s
Letter of Appointment and the Restraint of Trade and Confidentiality
Agreement concluded between the parties, safe for the duration
of the
restraint, which is now reduced to 12 months. In my view, that draft
order ought to be made an order of court.
[9]
In regards to costs, it was
common cause that following the filing and serving of this this
application, the first respondent had
on 7 December 2018
made certain undertakings
[1]
,
with a view of amicably resolving the dispute. The applicant’s
response on 10 December 2018 was to reject the
undertakings, further contending that the first respondent should
provide undertakings as set out in prayer 2 of the Notice of
Motion,
which undertakings would be made an order of court, and to further
tender its costs of the application. In his response
of
10 December 2018, the first respondent had reiterated his
tender and undertakings, other than disputing that the applicant
was
entitled to costs.
[10]
Central to the issue of costs as argued on behalf of the applicant is
the issue of whether the first respondent was in breach
of his
confidentiality and restraint undertakings, necessitating this
application. In this regard, the applicant’s case was
that the
first respondent had on 31 October 2018, approached one of
its clients, Kansai Plascon South Africa (Pty) Limited
(Clayville
site) in order to solicit business. Whilst the first respondent
admitted that certain sites of Kansai Plascon are the
applicant’s
customers, he nonetheless denied that Kansai Plascon as a group, and
in particular, the Clayville site is a customer
of the applicant.
[11]
Annexures ‘RA3’ to
the applicant’s replying affidavit is a ‘
Memorandum
of Service and Supply Agreement’
entered into between the applicant and Kansai Plascon South Africa
(Pty) Ltd on 2 February 2018. A further agreement
was
entered into between the parties in September 2018 in respect of
services to be rendered by the applicant in certain parts
of the
Johannesburg area
[2]
.
In his answering affidavit, the first respondent conceded having
dealt with Kansai Plascon South Africa Clayville site, but denied
having possessed any unfair advantage in dealing with that entity,
which in any event was not the applicant’s client
[3]
.
[12]
To the extent that such a concession was made, this in my view,
disposes of the arguments surrounding whether there was a breach
of
the restraint provisions or not, in the light of the agreements
referred to elsewhere in this judgment, as entered into between
the
applicant and Kansai Plascon South Africa (Pty) Ltd. To this end, I
am satisfied that the applicant has demonstrated that the
first
respondent had indeed acted in breach of his restraint undertakings,
and accordingly, the considerations of law and fairness
dictates that
he be burdened with the costs of this application. I how do not deem
it appropriate to make an order in respect of
wasted costs occasioned
by the adjournment of the proceedings on 13 December 2018.
[13]
Accordingly, the following order is made;
Order:
1. This application is heard as one of
urgency in terms of Rule 8 of the Rules of this Court.
2. For a period of twelve (12) months
from 3 September 2018 and throughout the whole of the Republic
of South Africa, the
First Respondent is interdicted and restrained
from:-
2.1
Whether for himself or as an agent of anyone else:-
2.1.1 Persuading, inducing,
soliciting, encouraging or procuring any current or prospective
clients of the Applicant to be enticed
away from the applicant or the
business of any current or prospective clients of the applicant to be
enticed away from the Applicant;
2.1.2 Marketing or selling any
service, information including proprietary information and/or
products which is in direct or indirect
competition with the
Applicant;
2.1.3 Utilising any relationship,
either personal or professional, which was developed during his
employment with the Applicant
and/or utilising the Applicant’s
resources, in order to generate a profit or value at the prejudice or
potential prejudice
of the Applicant.
2.2
Utilising directly or indirectly or divulging or disclosing any of
the Applicant’s trade secrets.
3. The First Respondent is ordered to
pay the costs of this application.
____________________
Edwin Tlhotlhalemaje
Judge
of the Labour Court of South Africa
APPEARANCES:
For
the applicant: Adv. L Hollander
Instructed
by: Mouyis Cohen Attorneys
For
the First Respondent: Adv. SM van Vuuren
Instructed
by : Weavind & Weavind INC
[1]
Annexure
‘PA02’
[2]
Annexure
‘RA4’ to the Replying Affidavit
[3]
At para
25.6 of the Answering Affidavit