IN THE LABOUR APPEAL COURT OF SOUTH AFRICA , JOHANNESBURG

Reportable
Case No: JA 45/ 23 & JA 25/23
In the matter between:
YOVANKA TORRENTE First Appellant
YOVANKA TORRENTE AND ASSOCIATES
INCORPORATED Second Appellant

and
GRANT MONAGHAN AND ASSOCIATES
INCORPORATED Respondent
Heard: 01 November 2023
Delivered: 23 January 2024
Amended on: 29 January 2025
Coram: Waglay JP, Mlambo JA et Davis AJA


AMENDED JUDGMENT


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DAVIS AJA

Introduction

[1] This appeal concerns the question as to whether a restraint of trade clause
should not have been enforced in that the respondent did not possess any legitimate protectable interest which justified a restraint of a former employee and accordingly , the
applicable restraint clause was contrary to public policy.
[2] This argument failed before the court a quo in that an application for the
enforcement of the restraint of trade agreement was upheld and the following order was issued:
‘For the period of a year from 10 February 2023 to 9 February 2024, the first and
second respondents are interdicted and restrained from conducting business closer than the radius of 27 km f rom the applicant’s business premises and from
employing any employees of the applicant.
The first and second respondent s are interdicted and restrained from directly or
indirectly including; soliciting and enticing away any employees, agents or any
persons that are customers or suppliers of the applicant.
There is no order as to costs.’

[3] It was against this order that the appellants approached this Court on appeal.

The factual background
[4] The respondent was registered as a medical orthotic, prosthetics and podiatry
practice. The respondent commenced practice in 2013, attending to the manufacturing
of orthotics, prosthetics and podiatry devices for patients as advised by referring doctor s. Its head office is situated in Sandton but it also has operational offices in
Parkwood and Mayfair.

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[5] The respondent ’s practice deals with upper and lower limb prosthetics, “off the
shelf ” and custom -made orthotic devices for the entire body as well as the servicing of
in and outpatients . According to Mr Monaghan, who deposed to the founding affidavit:
‘The applicant developed methods of engaging with it s patients and referring
doctors at great economic expense to it over its years in business and these
close relationships are an integral part of the applicant’s ability to provide its services and compete in the orthotics and prosthesis industry. The relationships ensure an in- depth knowledge of the business, structures, resources, working
methods and expectations of patients.’

[6] The first appellant (appellant) approached the respondent during 2017 and asked
to be employed as a student intern in order to be trained to be a proficient practitioner.
After qualifying in 2017, the appellant was employed by the respondent as a qualified
orthotist and prosthetist. According to the respondent , training, which was provided to
the appellant amounted to a cost of approximately R 1.5 million. The applicant was then
employed by the respondent as a medical orthotist and prosthetist as from 2 January
2018.

[7] Of relevance to this dispute is her contract of employment and specifically the
following clauses:
‘1. (20) Confidentiality : You must not during your employment or thereafter ,
regardless of the reason for the termination of the employment, communicate or
divulge to any unauthorised person any confidential matter or information relating
to the business affairs , process or trade secrets of the employer;
2. (4) Restraint of Trade: By the employee’s signature hereto, she
undertakes that from the date that her employment is terminated with the
company, the employee shall not directly or indirectly at any p lace within the
greater Gauteng, for a period of two years (from termination date of 20 January
2023 to 19 January 2025), whether for her own account or as a principal,
employee, agent, partner, representative, shareholder, consultant, advisor, or in
any other similar capacity whatsoever in relation to any person, syndicate,
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partnership, joint venture, corporation or company, and whether of the first
respondent’s direct or indirect benefit or otherwise, and whether for reward or
otherwis e, and whether formally or otherwise:
2.1 Be interested in or concerned in any business which is directly or indirectly
in competition with the business of the company or its suppliers;
2.2 Canvass, solicit, interfere with the or entice away an employee, patient,
agent or any person who is a customer and/or supplier of the company, nor shall
the first respondent attempt to do so;
2.3 Supply or make available to any person, any material, service or
information that forms part of the business of the company. ’
[8] The respondent avers that this later clause was important to its business in that
the appellant was exposed to its patient database, trade secrets, business know -how
and confidential information as from the time of her employment as from 2018.
[9] On 21 December 2022, the appellant resigned with notice from her employment .
Her last day of employment was 20 January 2023. According to Mr Monaghan, following
her resignation, the respondent investigated her conduct towards the end of November
2022 and December 2022 when certain information became known to the respondent ,
including a WhatsApp message of 27 November 2022 sent by a patient of the respondent inquiring about when the appellant will be opening her practice in
Bedfordview. On 30 November 2022, the appellant submitted a prescribed minimum
benefit application to Discovery as the Medical Aid for Master d e Bru yn. This application
was done under the practice number of the second appellant. The respondent became aware of th is submission as at the end of December 2022.
[10] On 15 December 2022, the appellant responded to a patient via email regarding
the process to be followed for cranial treatment. The appellant provided her personal number to the patient instead of the number of the respondent. On 19 December 2022 ,
the appellant approached the referring doctor, Dr P earce, one of the respondent’s
referring doctors , with regard to a patient to whom she stated that she would have new
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rooms in Bedfordview, Petervale and Bryanston in January 2023. She also provided a
personal link as well as a new booking line with her number. On 19 December 2022, the
appellant approached another referring doctor, Dr Halkas with regard to a patient where she stated that she would have new rooms in Bedfordview, Petervale and Bryanston in January 2023. On 1 December 2022, the first appellant requested an administrative
staff member of the respondent to follow up on a claim for Master J Reid with a reference number supplied by the appellant. Discovery , as the relevant m edical aid,
advised the respondent that it had received the application “ for the P ractitioner Y ovanka
Torrente but with a different practice number than that of the (respondent )”. The claim
was in the amount of R 81 401.09.
[11] On 21 December 2022, Terrence Garner -Bennett , the other partner of the
respondent had a discussion with the appellant when he enquired about the application for Reid during which discussion the appellant confirmed that she had submitted the
claim under her registered practice number and that she did so because she needed to
“get financial head start for her practice” . It also appears that between 22 December
2022 and 28 December 2022, further applications were made by the appellant to
Discovery, as the relevant medical aid but on behalf of the second appellant.
[12] Mr Monaghan also avers that by opening up the practice of the second appellant ,
the appellant will continue to utilise to her benefit confidential information obtained during her employment with the respondent in order to gain an unfair advantage as a
competitor .

The judgment of the court a quo
[13] In upholding the respondent’s application Matyolo AJ relied heavily on the
following conduct on the part of the appellant while still in the employ of the respondent:
‘1. Received a WhatsApp message enquiring about the date upon which the
[appellant] would be opening her new practice in Bedfordview .
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2. The [appellant] submitted a prescribed minimum benefit application, under
her practice number, to D iscovery for a Mr De Bruyn, a patient of the
[respondent].
3. The [appellant] provided her personal number , instead of the
[respondent’s] number, to a patient.
4. The [appellant] approached referring doctors informing them that she will
have new rooms in January 2023.
5. The [appellant] provided her own practice number to Discovery, a medical
aid service provider, in relation to a claim concerning Mr Reid, a patient of the
[respondent].
6. The [appellant] submitted claims under her new practice number. ’

[14] For these reasons , the learned Judge found that the fact that the appellant had
engaged with several patients during the period of her employment with the respondent
to inform them of her new practice and had spoken to an employee of the respondent
with a view to have her join the appellant ’s new business ; passed information regarding
banking details and the practice number of her new practice; and gave addresses of her
new practice to fellow professionals and some patients justified the conclusion that the
respondent had established a protectable interest in relation to, at the least, potential
inducement of customers and employees of the respondent to transfer to the business
of the second appellant .

[15] Howeve r, in seeking to limit the range of the restraint clause which would then be
the basis of the order of the C ourt a quo, the learned J udge found that the appellant’s
new practice was based in Bedfordview, 27 kilometres from the business of the respondent. This was , in his view, a reasonable distance from the respondent’s
business and constituted a reasonable geographical restriction as opposed to the wide
geographical area which was sought in the application brought by the respondent.

The appeal

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[16] On appeal , counsel for the appellant was invited to dispute any of the factual
findings which w ere central to the judgment of the C ourt a quo. He was compelled to
accept that he could not advance any plausible argument which would justify this C ourt
from concluding that the factual basis upon which the judgment at the C ourt a quo, and
thus the order w as based, were incorrect.

[17] The only argument that was raised on appeal was that the C ourt a quo was
incorrect to find that the customers and suppliers of the respondent constituted the kind
of trade connections which constituted a protectable interest. In counsel ’s view , a
protectable interest relationship only existed when the employee had personal
knowledge of and influence over the customers of suppliers of the employer so as to enable her to induce the customer or supplier to follow her to the new employer.
[18] In Reddy v Siemens Telecommunication (Pty) Ltd
1, the C ourt held that a
protectable interest can be established on the facts on the basis that the attachment between the employee sought to be restrained and customers of the example are of
such a nature that the employee would be able to induce the se customers to follow him
or her into a new business .
[19] It stands to reason that the question, therefore, with regard to the existence of a
protectable interest is fact -based. Much will depend on the employee ’s duties,
frequency of contact with client s, the duration of these contacts, the knowledge of the
nature of the business and requirements of clients and the general nature of the
relationship s which might have been built up between the employee and clients over the
period of the employment .
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[20] The importance of the fact -based nature of the enquiry is exemplified in a
decision of this C ourt in Labournet (Pty) Ltd v Jankielshon and another3 (Labournet ). On
the facts , the Court found that there was an insufficient basis to reject the employee’s

1 [2006] ZASCA 135; 2007 (2) SA 486 (SCA) at para 20.
2 See: Rawlins and another v Caravant ruck (Pty) Ltd 1993 (1) SA 537 (A) at 541.
3 [2017] ZALAC 7; (2017) 38 ILJ 1302 (LAC).
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denial of having a sufficient attachment to the clients of the appellant. T he employee’s
version in Labournet was that he had no reason to possess confidential details or
extensive information of any client of his employer and it was not necessary for him to
have such information in order to perform his duties.4
[21] In general , a C ourt which is required to evaluate a restraint of trade agreement
has also to engage with the reasonableness of the restraint. It is now trite law to note
that this enquiry is a value judgment which involves a consideration of a public interest which requires that parties to a contract should comply with their contractual obligations
(pacta sunt servanda) and the principle reinforced in s 22 of the Constitution of the
Republic of South Africa , 1996, namely that every citizen has a right to choose their
trade, occupation or profession freely. As stated by this Court in Ball v Bambalela Bolts
(Pty) Ltd and another
5, a Court seeks to achieve a balance between the respective
gravitational pull of pacta sunt servanda and s 22 of the Constitution by carefully
examining the nature of the activity prevented by the relevant clause, the area of
operation of the restraint, and the overall balance of the competing interest between the
parties.

[22] In this case, the Court a quo correctly crafted a narrow restraint. It is for the
duration of one year , which expires on 9 February 2024 and for a restricted area, being
that the appellants are interdicted and restrained from conducting business closer than
the radius of 27 kilometres from the respondent’s business premises and from
employing any employees of the respondent. In crafting such an order , it appears that
the learned Judge of the C ourt a quo sought to give meaning to the clauses of the
employment contract set out in the restraint clause; in particular , the conducting of any
business after employment with the respondent was terminated which “ is directly or
indirectly in competition with the business of the company or its supplier ”. In this case,
the conduct of the appellant in and of itself indicates that she had important and

4 Ibid at paras 55 – 56.
5 [2013] ZALAC 14; (2013) 34 ILJ 2821 (LAC) at para 17.
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valuable connections with patients and employees of the respondent , sufficient to divert
them to the business of the second appellant.

[23] By giving due weight to the importance of the freedom of trade and thus the
imperative of balancing the restriction contained in the employment contract with the
broader public interest encapsulated in the constitutional provision of s 22, the order
achieves a balance between the competing interests which suffices to justify the
restricted restraint which was the subject of the order of the C ourt a quo.

Conclusion
[24] For these reasons , the appeal against the order of the C ourt a quo of 10
February is dismissed. A lthough the C ourt a quo did not make an order as to costs , it
does appear that having been unsuccessful in the C ourt a quo bu t now prosecuting an
appeal, the appellants should pay costs which costs should follow the result.
[25] The parties were informed at the outset that a decision on the merits of the
appeal will render the application in JA25/23 moot and as such that the application will
be dismissed but there will be no order of costs in that matter.

[26] Accordingly , the following order is made:

Order
1. The appeal against the order of the C ourt a quo of 10 February 2023 is
dismissed with costs .
2. The appeal against the order of the Court a quo of 17 March 2023 is
dismissed with no order as to costs.

DAVIS AJA
Waglay JP and Mlambo JA agree.

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APPEARANCES:
FOR THE APPELLANTS: Adv. R Bhima
Instructed by Pagel Schulenburg Inc
FOR THE RESPONDENT: Mr C Higgs of Higgs Attorneys Inc