SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document
in compliance with the law and SAFLII Policy
IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE DIVISION, CAPE TOWN)
Case No: 22420/24
In the matter between:
K2014266944 SOUTH AFRICA (PTY) LTD Applicant
t/a HYPERION DEVELOPMENT
(Registration No: 2014/266944/07)
and
SINISHEN GOVENDER Respondent
(ID No: 8 […])
JUDGMENT DELIVERED ELECTRONICALLY ON 23 MAY 2025
MANGCU -LOCKWOOD, J
A. INTRODUCTION & BACKGROUND
[1] This is an application for enforcement of the terms of a restraint of trade
agreement between the applicant and the respondent. The applicant seeks an order
interdicting the respondent from rendering services to a company called Project Y , or
any entity conducting similar business , for a period of 12 months from the date of the
order , alternatively for a period of 12 months commencing on 10 July 2024 which
was the termination date of the respondent ’s employment at the applicant .
[2] The applic ant operates in the field of Education Technology – what the
industry calls EdTech – and provides online education platforms for people to
acquire or improve skills in various fields, including software engineering in several
programming languages and data base frameworks. It is one of only three
businesses of its size and reach in the South African education market, the others
being Get Smarter and Master Start.
[3] Students apply for admission and are accepted into the applicant’s
bootcamps, which are intensive courses. One of the vital element s of its business is
the cultivation of relationships with these students, from the admissions stage until
after their studies , as the students put to use their newly acquired skills.
[4] The re spondent commenced employment at the applicant on 1 June 2021 ,
and was employed as Head of Admissions, Collections and Student Success , which
was a senior managerial post . His responsibilities are described in annexure B to the
employment contract between the parties dated 23 April 2021 , and were later
augmented in a guidance document, which is also attached to the papers. Amongst
other things, he was tasked with managing the admissions and setting the
admissions policy, including developing innova tive student payment options such as
student loan financing , forecasting revenue from admissions , and ensuring that the
applicant’s business to customer admission strategies were effective.
[5] As part of the management team of the applicant , the respondent was
responsible for contribut ing to shaping and managing the company culture , scaling a
sales team from South Africa to multiple markets , collaborating with the CEO and
management team on strategic planning, and refining the generation of leads and
tracking processes of the applicant .
[6] Some of his responsibilities included data analy sis to understand application
registration flow, quality, team productivity and conversion rates ; building and
maintaining strong relationships with finance partners ; staying informed about
competitors in the education technology and higher education space ; and identifying
new business opportunities in current and planned markets . He was also in charge
of bootcamps described as Full Stack Developer and Data Science .
[7] On 10 April 2024, the respondent gave three months’ notice of his resignation,
and his employment terminated on with effect from 10 July 2024 . It is common cause
that part of his contract of employment at the applicant included a restraint of trade
agreem ent, also dated 23 April 2021 when he started employment there .
[8] The terms of the restraint are common cause. Clause 16 precludes the
respondent from seeking employment, or becoming employed by or contracted to,
any ‘Competitor ’ of the applicant during ‘the Restraint Period ’, all of which are
defined terms. A ‘Competitor’ is any “ entity which engages in commercial and/or
economic competition with the [applicant] with the same or similar Business as the
[applicant] ”;1the applican t’s ‘Business’ is defined by reference to 20 core features;
and the ‘Restraint Period ’ is “a period of twelve (12) months after the …date on
which the [applicant’s] employment with the [respondent] is terminated ”.2
[9] On 1 July 2024, whilst the respondent w as serving his three months’ notice of
termination, the applicant experienced a security breach targeting one of its
platform s called Nutshell , a key element to the applicant ’s business which is
managed by the team that was led by the respondent . Nutshell is a system used by
the applicant to manage leads , which are the identities and details of students who
have indicated an interest in taking one of the courses offered by the applicant .
Accor ding to the applicant ’s investigations , an unauthorised user gained access to
the system using the respondent ’s login details , and downloaded a file, which had
previously been exported on 11 June 2024 by also using the respondent ’s login
details.
[10] After his resignation from the applicant, the respondent became associated
with an entity trading under the name “ Project Y ”. According to the respondent,
Project Y is the brand name of a German entity, Y Nation UG, that through its
1 Clause 16.1.3.
2 Clause 16.1.7.
German subsidiary, SA Future Talents, funds a small number of disadvantaged,
unemployed South Africans through a model similar to an income share
arrangement.
[11] According to the LinkedIn profile for Project Y , the business has existed since
at least October 2023, or at the earliest, May 2023. In the same profile, the
respondent is described as ‘Co-Founder and Chief Operations Officer ’ of Project Y ,
who is a “renowned ed tech celebrated for his transformative im pact on the
educational technology landscape. [The respondent] has played a pivotal role in
scaling some of the industry’ most innovative companies from startup phases to
successful acquisitions...”. On the basis of this information the applicant states th at
the n ecessary implication is that the respondent took an active role in the founding of
the business whilst still employed by the applicant.
[12] On 13 August 2024 Mr Moola of the applicant sent an e-mail to the
respondent , advising that he had become aware of his involvement as a co -founder
of Project Y, which he regarded as a direct competitor to some of the applicant’s
business, in contravention of the restraint of trade, and asking him to sever his
relationship with that business.
[13] The respondent replied on 16 August 2024, seeking clarity regarding the
alleged breach, and also requesting documents relating to a similar matter which
was r eferred to in the e -mail of Mr M oola of 13 August 2024 . There was further
exchange of communication , to and fro , from 13 August 2024 until 12 September
2024 when the applicant ’s attorneys issued a letter of demand, which elicited more
questions of clarity from the respondent . On 10 October 2024 the respondent’s
attorney sent a letter to the applicant’s attorneys in which any alleged breach of the
restraint of trade agreement was disputed.
[14] In all these letters the part ies mentioned the possibility of an amicable
resolution of the dispute between them, and although dates and times for such an
endeavour w ere proposed, no such resolution occur red. Instead, on about 15
October 2024, the applicant launched these proceedings as urgent proceedings. On
30 October 2024, the matter was struck of the roll for want of urgency.
[15] The applicant states that it has a protectable interest that is safeguarded by
the restraint provisions , which it is seeking to enforce , in the form of valuable and
confidential resources which , if made available to a competitor , would save the
competitor time, money and resources an d allow it a springboard to enable it to
compete faster and more effectively than would be the case if it did not have access
to that information . And that by working for Project Y, which is its competitor , the
respondent is engaging in conduct which is contrary to the provisions of the restraint
agreement .
B. THE LAW
[16] The law regarding restraints of trade is now reasonably settled.3 Restraint of
trade agreements are enforceable unless their enforcement would be contrary to
public policy.
[17] A party seeking to enforce a contract in restraint of trade is required only to
invoke the restraint agreement and prove a breach thereof. There after, a party who
seeks to avoid the restraint bears the onus to demonstrate, on a balance of
probabilities, that the restraint agreement is unenforceable because it is
unreasonable.4
[18] A restraint of trade is unreasonable if it does not protect some proprietary
interest of the person who seeks to enforce it.5 There are two kinds of proprietary
interest that can be protected by a restraint of trade, namely :
a) Relationships with customers, potential customers, suppliers and others
that make up what is compendiously referred to as the 'trade
connections' of the business, being an important aspect of its incorporeal
property known as ‘goodwill ’;
3 See synopsis of authorities set out in Avis Southern Africa (Pty) Ltd and Others v Porteous and
Another 2024 (2) SA 386 at [87] to [98].
4 Experian South Africa (Pty) Ltd v Haynes & Another 2013 (1) SA 135 (GSJ) at 140 F -G.
5 See Basson v Chilwan Avis SA supra at [87] and the authorities cited therein at fn 42 -44.
b) confidential matte r which is useful for the carrying on of the business and
which could therefore be used by a competitor, if disclosed to him, to
gain a relative competitive advantage. Such confidential material is
sometimes compendiously referred to as 'trade secrets' .6
[19] Not all trade connections are protected. It must be established as a fact that
the employee has acquired “ such personal knowledge of and influence over the
customers of his employer… as will enable him … if competition were allowed, to
take advantage of h is employer’s trade connections .”7
[20] Whether information constitutes a trade secret is also a factual enquiry. For a
trade secret to constitute a protectable interest it must meet each of the following
three requirements: (a) it must be useful in trade or industry and not be public
knowledge; (b) it must be known only to a restricted number of people; and (c) it
must be of economic value to the party seeking to protect it. Evidence must be
provided to establish the existence of all three requiremen ts.8
[21] As regards the bona fides of an ex -employee, the following was stated in
Experien South Africa :
“The ex -employer seeking to enforce against his ex -employee a protectable
interest recorded in a restraint does not have to show that the ex -employee
has in fact utilised information confidential to it: it need merely show that the
ex-employee could do so. The very purpose of the restraint agreement is to
relieve the applicant from having to show bona fides or lack of retained
knowledge on the part of the respondent concerning the confidential
information. In these circumstances, it is reasonable for the applicant to
enforce the bargain it has exacted to protect itself. Indeed, the very ratio
underlying the bargain is that the applicant should not have to content itself
with crossing its fingers and hoping that the respondent would act
honourably or abide by the undertakings that it has given . It does not lie in
6 Experian ( supra) at 141 A -C; Sibex Engineering Services (Pty) Ltd v Van Wyk and Another 1991 (2)
SA 482 (T) at 502
7 Avis SA supra at [90], quoting Herbert Morris Ltd v Saxelby [1916] 1 AC 688 (HL) at 709.
8 Avis SA supra at [95].
the mouth of the ex -employee who has breached a restraint agreement by
taking up employment with a competitor to say to the ex -employer, 'Trust
me, I will not breach the restraint further than I have already been proved to
have done.”'9 (own emphasis)
[22] Only once it established that the party seeking to enforce the restraint has an
interest worthy of protection, and that the other party is threatening that interest,
does the enquiry shift to whe ther enforcing the restraint would be unreasonable.10
[23] In Basson v Chilwan11 the Supreme Court of Appeal set out the elements to
be taken into account in determining whether or not it is reasonable to enforce a
restraint, which are translated as follows: (a) Is there an interest of the one party
which is deserving of protection at the termination of the agreement? (b) Is such
interest being prejudiced by the other party? (c) If so, does such interest so weigh up
qualitatively and quantitatively against the interest of the latter party that the latter
should not be economically inac tive and unproductive? (d) Is there another facet of
public policy having nothing to do with the relationship between the parties, but
which requires that the restraint should either be maintained or rejected?
[24] Since this is an application for final relief , the principles established in the
matter Plascon -Evans Paints v Van Riebeeck Paints12 are applicable concerning
disputes of fact arising. That is that a final order will be granted if those facts averred
in the applicant’s affidavits which have been ad mitted by the respondent, together
with the facts alleged by the respondent, justify an order.
[25] It may be different if the respondent ’s version consists of bald or
uncreditworthy denials, raises fictitious disputes of fact, is palpably implausible, far -
fetched or so clearly untenable that the court is justified in rejecting them merely on
the papers.13 The court has to accept those facts averred by applicant that were not
disputed by respondent, and respondent ’s version insofar as it was plausible,
9 At 142 F -I.
10 Avis SA supra at [88].
11 Basson v Chilwan & Others 1993 (3) SA 742 (A) at 767 G -J.
12 Plascon -Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd 1984 (3) SA 623 (A) .
13 Media 24 Books (Pty) Ltd v Oxford University Press Southern Africa (Pty) Ltd 2017 (2) SA 1 (SCA);
National Director of Public Prosecutions v Zuma [2009] 2 All SA 243; 2009 (2) SA 279 (SCA).
tenable and credible.14 It is otherwise undesirable to decide an application upon
affidavit where the material facts are in dispute15, and a final interdict may be granted
on application if no bona fide dispute of fact exists.16
C. DISCUSSION
[26] The applicant states that it has a clear contractual right enshrined in an
express written agreement containing a covenant in restraint of trade ; that the
restraint of trade provisions are not contrary to public policy , nor are they
unreasonable ; and that there has been a n injury actually committed , in the form of a
breach of the agreement . Further , that it has a well -grounded and reasonable
apprehension that it will suffer further irreparable harm should the interdict n ot be
granted and there is no other effective remedy available to it .
[27] The respondent opposes the application on the basis , firstly that the applicant
has failed to establish a proprietary interest that would be protected by enforcing the
restraint . In this regard, it state s that the applicant relies on generic references to
confidential information and company strategies, without adduc ing any evidence of
exactly what proprietary information it says is actually in the possession of the
respondent, or of what goodwill it contends is threatened by the respondent’s
association with Project Y.
[28] However, there are a number of averments made by the applicant in relation
to its proprietary interest , which are not dispute d in the papers . First is the applicant’s
averment that Mr Moola, the sole director of the applicant, has made the building of
the business of the applicant his primary responsibi lity and focus for the last 10
years, both in South Africa and in other countries particularly the United Kingdom. It
is also not disputed that he has spent much of that time developing products and
cultivating customer relationships ; and that h e has also extensively investigated the
possibility of extending the applicant ’s course offering to cover all elements of
modern business and technology. None of this is disputed by the respondent.
14 Airports Company South Africa Soc Ltd v Airports Bookshops (Pty) Ltd t/a Exclusive Books [2016] 4
All SA 665 (SCA).
15Harmse Civil Procedure in the Supreme Court , B6.45 .
16Plascon -Evans supra .
[29] It is also common cause that a vital element of the applicant’s business is the
cultivation of relationships with students who are admitted into the various
bootcamps, from the admissions stage, through during the students ’ progression
during studies , and thereafter as the students put to use their newly acquired skills .
It is not disputed that t he respondent was privy to all the admissions and student
improvement strategies associated with such a hybrid learning product.
[30] The respondent seeks to min imise his relatively significant exposure and
prowess in admissions and student improvement strategies of the applicant by
stating that he was only privy to the applicant’s admissions and student improvement
strategies until December 2021. That, however, d oes not detract from the fact of his
exposure to the strategies, which are indisputably an important aspect of th e
business of the applicant.
[31] The applicant states that the respondent was privy to significant confidential
information regarding existing student leads and current state of negotiations with
various partners including prospective partners. To this the respondent states he had
limited knowledge relating to marketing and negotiations and was not part of
‘everything ’. But he does not deny that he was privy to significant confidential
information regarding existing student leads and current state of negotiations with
current and prospecti ve partners. In fact, it is not denied that the respondent was
tasked with various contractual obligations, which involved confidential information.
[32] The applicant states that , by virtue of his position the respondent acquired an
intimate and commercially valuable understanding of how the bootcamps are priced,
sold and delivered. Although the respondent denies that there was intimate and
commercially valuable understanding or learning about the pricing of bootcamps, he
also states that “at times various members would be tasked with conducting an
analysis of past pricing and propose a new set of fees ”. There would be no need to
embark on such a task if the information was no t commercially valuable , and if it did
not require intimate understanding of the business of the applicant .
[33] It is not denied that the respondent was involved in all strategic planning and
had access to quarterly objectives and key results set across the applicant’s
business , which are goal setting frameworks for the applicant. Further, that he
attended monthly meetings known as s yncs in which various company metrics were
highlighted and discussed. The s yncs were conducted by using confidential
documents containing the data of every metric that the applicant tracks, known as
strategy blueprints. It is not disputed that these are highly valuable to the applicant
and are confidential, and that access to them would be of extremely valuable to a
competitor.
[34] The respondent does not dispute the confidentiality of the documents used at
the sync meetings . He explains, however, that various employees were , at different
stages , part of the s yncs and that the information shared was not specific only to
himself or his role at the applicant . Even in the respondent’s version, it is not claimed
that the information used at the syncs was public knowledge . And there is no
allegation that, by granting access to other employees, the confidential nature of the
information which he admits , was diminished . I do not understand the law to require
confidential information to be shared with only one individual, in this case the
respondent, in order to meet the requirement s of confidentialit y set out in
Townsend17 and Mossgas18. There is certainly no evidence that those other
employees who were privy to the confidential information used at syncs were not
entitled to information of a confidential nature at the applicant . There is otherwise no
dispute that the information used at those meetings is useful in the industry in which
the parties operate, and that it is of economic value to the applicant.19
[35] All of the above is sufficient to conclude that the applicant has established a
protectable interest in the form of trade secrets and goodwill. The next question is
whether there has been a breach of the restraint by the respondent. The main bases
on which the respondent denies any breach is firstly that Project Y is not a
competitor of the applicant , and secondly, on the basis of his limited role there .
17 Townsend Productions (Pty) Ltd v Leech & Others 2001 (4) SA 33 (C) at 53J -54B.
18 Mossgas (Pty) Ltd v Sasol Technology (Pty) Ltd [1999] 3 All SA 321 (W) at 333F.
19 See Avis SA v Potgieter para [94].
[36] As regards the argument that Project Y is not a competitor of the applicant,
the respondent emphasises that the business models of the two companies are
different. He emphasises that the applicant and its competitors in the market are
providers of Education Technology and are involved in the curation and delivery of
academic programmes or bootcam ps, which are in turn sold at a commercial level to
clientele. Further, that the applicant and its competitors operate by earning revenue
for their bootcamps through various payment methods, irrespective of the customers’
background . The applicant, accordi ng to him, only provides services to those who
can afford it.
[37] By contrast, the respondent states that Project Y is a membership platform
which offers a small group of disadvantaged youth access to a cash stipend used for
basic needs, transport, housing, e ducation and necessities; education should they
need it; trauma counselling, laptops and infrastructure such as a safe working space.
It is not a coding bootcamp provider. Further, that it is an international project, and is
not a list of the applicant’s s mall list of competitors, who are named in the founding
affidavit as Master Start and Get Smarter.
[38] Whilst the respondent admits that Project Y indirectly offers 3 of the 20
services defined in the restraint clause as comprising the ‘business ’ of the applicant ,
he distinguishes th ose three services in that they are not limited to careers in
software development and may include any career pathway, such as sales . Further,
that Project Y aims to place its members mainly with German employers, and the
applicant does not operate in the German market and is only focused in the UK and
South Africa. Furthermore, he states that , after attainment of employment by the
students, Project Y continues to support the members by providing infrastructure and
benefits for a period of two years.
[39] In addition to the admitted indirect overlaps above, t he papers indicate that
there are more significant overlap s between the businesses of the applicant and
Project Y . It is important to bear in mind that, when determining whether the two
businesses are competitors, the relevant question is not whether their business
models or areas of emphasis are identical – all businesses hav e different business
models - but rather whether the business or services offered by the two are
sufficiently similar to amount to a breach of the restraint provisions. The degree of
the overlaps is not the point, since the restraint is not aimed at the business of
Project Y but at the conduct of the respondent.
[40] In the restraint agreement , ‘Business’ is defined as follows:
“16.1.2.1 Building, supporting, and delivering mentor -led online and on -
site coding bootcamp education;
16.1.2.2 Providing, building or supporting on -demand code review
systems;
16.1.2.3 Providing or building platforms for, or supporting, online and on -
site coding education;
16.1.2.4 Providing, building or supporting the assessment of coding,
software development o r technical skills of candidates in the
hiring process;
16.1.2.5 Providing, building or supporting synchronous code review
systems;
16.1.2.6 Integrating Artificial Intelligence techniques to make code review
more scalable and effective in an educational context and/or for
students learning how to code;
16.1.2.7 Building course content for programmers learning mobile, web,
and/or software engineering to be delivered online or on -site in a
mentor -led manner with a human mentor ;
16.1.2.8 Building course content for software development education with
the support/partnership of tech companies such as Google or
Facebook;
16.1.2.9 Building both the technical and operational infrastructure to
provide review of code at scale in both an education and
software development context;
16.1.2.10 Building course platforms from both an operational and technical
perspective;
16.1.2.11 Developing mentor -led online and on -site education systems
and processes ;
16.1.2.12 Integrating mentors from one relatively low cost market to
support students in a higher income market on online or on -site
education;
16.1.2.13 Supporting projects such as Jobs Fund and SDL -funded
education projects in South Africa .
16.1.2.14 Fundraising from investors in South Africa, the US, an d the UK
for the purpose of furthering an online or on -site edtech product.
16.1.2.15 Building a community of coding education, coding mentors, and
code reviewers in the development world to service educational
needs of students learning to code in anothe r or the same
market as the community;
16.1.2.16 Developing a system for sourcing mentors , code reviews, and
code educators from top technical talent in African countries;
16.1.2.17 Building free trials for coding education to be delivered on an
online e ducation platform;
16.1.2.18 Placing software developers and data scientists in tech roles
with companies;
16.1.2.19 Providing recruitment services to companies hiring developers;
16.1.2.20 Building and hosting an online careers platform to connect
companies with developers, data scientists and software
engineers .”
[41] From the evidence in the papers already discussed above, there are some
overlaps in at least 7 of the above itemised business areas of the applicant, namely
16.1.2.1, 16.1.2.7, 16 .1.2.10, 16.1.2.11, 16.1.2.13, 16.1.2.16, 16.1.2.19 and
16.1.2.20. The overlaps between the two businesses, as identified from the papers
may be summarized as follows :
(a) Both companies offer and deliver online learning products to students.
(b) They both market online learning products to students that provide
education in the field of computer technology.
(c) They both market courses designed to upskill learners in the fields of
coding (writing programs) and other related fields.
(d) They both offer funding opportunities to students who cannot afford the
offered bootcamps.
(e) They both cultivate relationships with third party employers to provide
employment opportunities to students c oming out of the offered courses.
(f) The courses marketed by the applicant and Project Y are not solely
digital in that both offer the interpersonal mentorship.
[42] The respondent emphasises the fact that Project Y does not itself offer
courses, but that they are provided by third parties. Thus, argues the respondent, the
product offering and business model of Project Y is materially different to the
applicant’s, whos e core focus is bootcamp training.
[43] The business model is not the point, because the restraint is not aimed at
Project Y. In K2014266944 South Africa (Pty) Ltd t/a Hyperion Development v Du
Plessis20, a matter from this Division involving the same contract wording as in the
present matter , the respondent argued that the company he joined did not offer
bootcamps itself, but referred students to online programs offered by a third entity
(Cambridge Spark). On this basis, the ex -employee argued that the new employer
was not a competitor of the applicant. The court dismissed this argument stating inter
alia:
“As regards the four courses supplied by Cambridge Spark, both
Cambridge Spark and the applicant vie for the same goal. They are
pitted against each of the for the provision of the same courses and
services. They scramble for the same clientele. They compete… ”21
[44] The difference in business models do es not mean that businesses are not
competing for the same clientele. The fact that Project Y does not itself provide the
education, or take part in any designing, delivering or improving the bootcamps itself,
and instead engages with other bootcamp provider s in South Africa, must be seen in
that light. In its engagements with those other businesses who are the applicant’s
competitors, there is an overlap in the services provided.
[45] The same may be said in response to the respondent’s argument that the
mentorship provided by Project Y relates to life skills guidance, uplifting and
motivating members, rather than coding which is the emphasis of the applicant.
Whilst employed by the applicant, the respondent was placed at the forefront of one
of the largest mentor -led education programmes in the world, including its
campaign s and strategies.
[46] It is also not disputed that school leavers are within the catchment of Project
Y, although that is not its main focus. Nor that its business is aimed at the South
African market, save that Project Y is aimed at individuals who are disadvantaged
and lack the resources to become employed .
20 K2014266944 South Africa (Pty) Ltd t/a Hyperion Development v Du Plessis (case no 1577/23)
21 Para 9 of the Judgment.
[47] In support of their cases, b oth partie s refer to an approach made by the
founder of Project Y, Mr Felix Anthonj, to the applicant’s sole director, Mr Riaz
Moola, on 24 May 2023. In the email, Mr Anthonj wrote as follows:
“I am pretty much at the beginning of a new venture and also quite new
to the African startup ecosystem in general (my network is mainly in
Germany), hence the reason for contacting you was to:
(a) Extend my network/ meet the most successful and promising
founders in Cape Town area...
(b) Get feedback on my new venture idea and validate my
assumptions (e.g. underprivileged talents do not have access or
the necessary funding to education programmes such as [the
applicant] or ‘ed -tech providers such as [the applicant] happy to
let me integrate and distribute their products to peo ple that
cannot afford it ‘free of charge’ o[r] ‘at cost’).
(c) Pre-select potential vendors for my ecosystem (I do not have the
intention to build any of the education services myself), but to
partner with the best service providers available and help them
grow their brand internationally, to increase their social impact
and provide them with free leads for cross - or upsells and
access to the talent).”
[48] On 1 June 2023 Mr Moola declined the invitation, stating that he did not have
time or incentive to assist Mr Anthonj. In these proceedings, h e states that he
declined the invitation because he realised that Mr Anthon j's business venture , which
was to promot e other companies that offer online education , would be in competition
with the applicant , which already offered funding services for students who could not
afford payment. He states that , since the e -mail of 24 May 2023 makes clear that
Project Y was considering using the applicant as a potential vendor , it is axiomatic
that the vendor selected in its stead is in the same or similar business .
[49] The respondent denies that Mr Moola perceived Project Y as a competitor,
because he did not mention any such perceived competit ion. He points to the fact
that Mr M oola later reached out to Mr Anthon j on 13 August 2024 , “recalling that we
didn't have a chance to chat. I am now more open - would you be open to a quick call
to share notes?”
[50] In a further email of 14 August 2024, Mr Moola stated as follows: “we've
recently raised R100 million to fund free courses for unemployed SA youth and so let
me know if you want to talk for pathways on that as I see you operating an ISA
model which is a part of the pr oject we've been working on. ” According to the
respondent, the further email of 14 August 2024 should be viewed with suspicion
and should be viewed as a surreptitious attempt to create competition with Project Y ,
which did not exist. He states that the timing of this e -mail is highly suspicious in that ,
in all his years at the applicant , there was never any project in terms of which free
courses were offered to unemployed South Africans. In that regard the respondent
challenged the applicant to provide p roof that he did indeed receive such funding .
There is no reply to these allegations.
[51] It is understandable that the applicant did not reply to the challenge to provide
proof of the funding. In the answering affidavit , the respondent state s that he was
‘not aware ’ of any specific strategies aimed at fully funding disadvantaged South
African students who could not afford to pay for the boot camps; and he ‘has no
recollection ’ of any active strategy aimed at fully funding disadvantaged S outh
Africans who coul d not afford the boot camps; he ‘is not aware ’ of the applicant
developing any innovative student payment options”. There is no outright denial in
this regard. Given his previous position at the applicant, I would have expected him
to have knowledge on thi s issue and to be able to deny it if that was his stance in
these proceedings. It is difficult to conclude that the respondent ’s denial in this
regard is genuine or credit worthy .
[52] As regards the perception of the approach by Mr. Anthon j in May 2023 , it is
correct that Mr Moola did not decline the invitation on the basis of a perceived
competition . And even in his follow up e -mail in which he was now available to
connect with Mr. Anthon j, there was no indication of any perceived competition .
However, it might be argued that , by reaching out to Mr Anthonj, he wanted to gain
more understanding of the nature of his business so that he could reach a
conclusion in that regard . And the fact that he did not expressly refer to perceived
competition does not m ean that he did not have such perception or suspicion. The
question is whether this issue raises a genuine dispute of fact .
[53] I am of the view that this issue is a red herring and does not rise to the level of
a genuine dispute of fact because, when these emails commenced (May 2023) on
their express wording, the business of Project Y had not yet been established . The
case law ind icates that a restraint must be determined at the time that a court is
requested to enforce that restraint.22 The context of those emails indicate s that there
had been no comprehensive discussion between Mr. M oola and Mr. Anthon j
regarding the detail of the business of Project Y , which would have caused the
applicant to approach the Court at that stage.
[54] As for the later e -mail from Mr Moola of 13 August 2024 , it was sent on the
same date as the e -mail sent to the respondent in which h is association with Project
Y was referred to as a transgression of the restraint . In the e-mail address ed to the
respondent , Project Y was pointedly referred to as a competitor . There is accordingly
no substance to the respondent ’s argument that the applicant did not view project Y
as a competitor .
[55] I am otherwise in agreement with the applicant’s conclusion that, since the e -
mail of 24 May 2023 makes clear that Project Y was considering using the applicant
as a potential vendor, that the vendor selected in its stead is in the same or similar
business as the applicant .
[56] I am accordingly satisfied that the two businesses are competitors as defined
in clause 16 .1.3 of the employment agreement in that they engage in commercial or
economic competition with each other and with the same or similar business.
22 Magna Alloys and Research (SA) (Pty) Ltd v Ellis 1984 (4) SA 874 (A) at 894G, 896C -E, 898D.
[57] The respondent denies being contracted or employed by Project Y, and state s
that he offers pro bono services to it. He states that, contrary to what is advertised on
the website of Project Y, he is not a co -founder of the business, and that the title was
offered to him as a n honor arium. Moreover, h e states that at Project Y he performs
none of the dutie s that he previously performed at the applicant. He explains that his
role at project Y consists predominantly of soft coaching with members in need,
facilitating access to counselling services, assisting with housing disputes and
building soft skills such as business professional English.
[58] In answer to the various overlaps between the businesses of the applicant
and of Project Y , some of which are not in dispute , his constant refrain is that he
performs none of the functions that he performed whilst employed by the applicant ,
and there is accordingly no danger of him transgressing the terms of his restraint .
[59] What the respondent is restrained from is taking up work, whether paid or
unpaid, with a business that is a competitor of the applicant as defined in the
common cause agreement, and which conducts a similar business . As stated in
Experien , it is not necessary for the applicant to show that the respondent is in fact
sharing information of a confidential nature. It is enough that he can. The applicant
should not have to contend with the anxiety of whether he will act in good faith whilst
in that environment. That was the point of the restraint agr eement.
[60] One example in this case is the fact that it is not disputed that he has retained
contact with the third parties who provided funding for the bootcamps he was
responsible for, namely Stack Developer and Data Science , and that he acquired in -
depth understanding and contact with them from his work at the applicant. That
experience is, no doubt, beneficial and valuable to Project Y .
[61] Yet another example is the common cause fact that he was privy to significant
confident ial information regarding existing student leads and current state of
negotiations with current and prospective partners. To this the respondent can only
retort that he was not privy to everything.
[62] In the same vein, whilst employed by the applicant, the respondent headed
the admissions department for one of the largest mentor -led education programmes
in the world, and by virtue of that position, was placed at the forefront of that mentor -
led online learning campaign. Whilst he states that mentors are onl y involved post
enrolment , and that he was not involved at that stage at all , he does not deny that he
was exposed to, and ha d access to , the mentoring strategies.
[63] It is not enough for the respondent to state that the information he acquired is
not relevant to his current role. It is very valuable information to the applicant which
would similarly be valuable to Project Y . Otherwise, there would be no point in
leveraging the respondent’s experience, which is advertised in Project Y’s website as
a “renowned ed tech celebrated for his transformative impact on the educational
technology landscape ”.
[64] I am accordingly of the view that the applicant has discharged the onus to
establish facts necessary to establish a breach of restraint of trade provision s. It is
not necessary to determine the issue of the security breach involving Nutshell. The
above -discussed issues are sufficient to discharge the onus placed upon the
applicant. The matter is, in any event, still under investigation, and it would not be
appropriate to determine it in motion proceedings.
[65] What remains for consideration is whether it would be unreasonable to
enforce the restraint , in respect of which the respondent bears the onus. In this
regard, the respondent’s case is mainly premised on the argument that the two
companies are not competitors. I have already made findings in this regard.
[66] What is more, the terms of the restraint are common cause. There is
otherwise no case made out by the respondent that its terms are excessively
prohibitive in duration or regarding its area of effect. Nor does the restraint of trade
prohibit him from worki ng. As the applicant points out, the restraint does not prohibit
the respondent from working in the field of education, in respect of which he has
qualifications and experience. It only prevents him (for a limited time) from working
for a limited set of bu sinesses that are competitors of the applicant and conduct
similar business. For all these reasons, the respondent has accordingly failed to
show that the terms of the restraint agreement are unreasonable.
[67] In the language of an interdict, all of the abov e has established that the
applicant has established a clear right, and a reasonable apprehension of continuing
harm. Furthermore, as set out earlier, prior to the launching of these proceedings the
parties engaged in correspondence in which mention was ma de of an amicable
resolution of the dispute, but that bore no fruit. There is accordingly no alternative
remedy available to the applicant , other than to enforce the terms of the restraint .
D. REMEDY
[68] Clause 16.5 of the restraint agreement provides as follows:
“Should any of the provisions of this Agreement be breached by the
Employee, then the restraint period will be deemed, at the instance and in the
discretion of the Company, to be extended by a period equal to the period
from when such a breach came to the attention of the Company until the date
on which the Employee ceases to be in breach of this Agreement. If the
Company exercises its rights to extend such period as aforesaid, the
provisions of this Agreement will apply mutatis mutandis in respect of such
extended period.”
[69] In effect, cl ause 16.5 allows the applicant, at its discretion to delay the start of
the 12 -month restraint period, until the breach of the agreement has been cured.
Relying on that provision, the applicant seeks an order interdicting the respondent
from continuing to be employed or contracted with Project Y, for a period of 12
months, commencing on the date of the order. In the alternative, it seeks an order
interdic ting the respondent from continuing to be employed or contracted with Project
Y for a period of 12 months, commencing 10 July 2024 ending on 10 July 2025.
[70] Given that the respondent states he provides his services on a pro bono
basis , I do not consider the scope , nature and duration of the restriction to unduly
burden his right to earn a living , or to be against public policy and unenforceable .
The restraint of trade does not prohibit him from working in the field of education . I
also take into consideration that t he effect of the alternative order would render the
restraint nugatory, since it would amount to a restraint period of approximately a
month and a half.
[71] There is otherwise no reason why costs should not follow the result.
E. ORDER
[72] In the circumstances, the following order is granted:
1. The respondent is interdicted from rendering services to Project Y or any
entity conducting similar business, for a period of 12 months , calculated
from the date of judgment, which is 23 May 2025 .
2. The res pondent is to pay the costs of this application , including costs of
counsel, on a party -party basis, on Scale C.
_________________________
N. MANGCU -LOCKWOOD
Judge of the High Court
APPEARANCES
For the applicant : Adv. R .A.J. Acton
Instructed by : M.Y. Jamal
Larson Falconer Hassan Parsee Attorneys
For the respondent : Adv S. Fuller
Instructed by : J. Henkes
Johnny Henkes & Associates