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Koolfoam Industries Ltd v Bath
12 Feb 2008, D King, AA 38/08, (11 pages)
BREACH OF CONTRACT - Applicant claimed respondent breached confidentiality provisions and good faith obligations of employment agreement ("EA") - Applicant manufacturer of expanded polystyrene ("EPS") - Respondent set up EPS factory and traded through company "EFL" where owned 50 percent of shares - Applicant executed Anton Piller order on EFL premises and respondent's home - Applicant claimed search uncovered lists of names and telephone numbers taken while respondent employed by applicant for purposes of using information to compete with applicant - High Court granted interim injunction restraining EFL from contacting or disclosing names identified as customers of applicant - Respondent denied breached duty of good faith or fidelity towards applicant - Respondent argued owed contractual duty of confidentiality but denied separate obligation of confidence - Respondent denied taking confidential information and submitted applicants claims based on considerable overlap between customer lists - Authority accepted applicant's argument that respondent's contact list contained numbers that could not have been obtained from source other than applicant - Authority found since respondent not in position trusted with confidential information, must have gone out of way to obtain information to set up competing business - Authority found respondent an unreliable witness due to inconsistencies in affidavit evidence - Authority found implausible explanations by respondent used to explain how numbers on list obtained - Authority outlined numerous examples of incongruities in respondent's evidence - Authority accepted sufficient evidence that contact information sourced from applicant - Authority satisfied information confidential - Authority concluded respondent went out of way during employment to access respondent's customer lists and did not obtain lists from external sources as argued - Respondent argued nothing novel about applicant's customer list and anyone in related business could reconstruct list - Authority found respondent did not reconstruct list but copied customer details and used information to compete with applicant - Found actions amounted to misuse of confidential information - Authority accepted that having found respondent took contact list information from former employer while an employee breached duty of fidelity and good faith obligations - Authority considered submission respondent may not have entirely understood some questions asked - However, found respondent understood questions but had difficulty providing answers - Damages - Issue of damages not something to be decided in this case - Authority suggested parties to discuss damages issue before deciding whether to return to Authority
Result: Application granted ; Damages (Assessment to be made on application by parties) ; Costs reserved
Wright v Hevila Pak Ltd
11 Mar 2008, R A Monaghan, AA 86/08, (8 pages)
UNJUSTIFIED DISMISSAL - Redundancy - Abandonment - Applicant claimed redundancy engineered to get rid of applicant due to conflict between applicant and chairman of board of directors ("F") - Respondent argued applicant abandoned employment - F advised staff in individual letters that business not performing well, was reviewing operations and would arrange individual meetings - Applicant advised F did not wish to attend meeting - Applicant attended later meeting with F to discuss outcome of review - F advised would recommend at AGM that applicant's position be made redundant - Applicant responded "good luck" - Applicant present at AGM where meeting resolved to recommend to respondent's board that applicant's position redundant - Applicant asked if that meant he no longer had job - F replied "probably" but another shareholder replied not final decision - Applicant began preparing to leave workplace - Authority preferred F's evidence that F explained that applicant still employee and expected to carry out work until board made decision on redundancy - Applicant left, not attending final meeting when decision to discontinue position finally made - Authority had reservations about F's approach, but accepted valid reasons for considering future of applicant's position - Found applicant's response to F's attempted review unwise and not in own best interests - Found outcome of AGM not applicant's dismissal - Position remained until directors resolved to discontinue it - Found unclear what final outcome would have been because applicant pre-empted any action and consultation about future employment options - Found departure too premature to allow finding that treatment was such that applicant entitled to reach conclusion that was dismissed - Applicant's departure pre-empted any termination that may have been imposed after director's meeting and subsequent consultation with applicant - Therefore no issue of justification arose - No dismissal - BREACH OF CONTRACT - PENALTY - Counterclaim - Respondent argued applicant breached employment agreement ("EA") by failing to give reasonable notice period and carry out duties while EA remained in force - Respondent sought penalty for breaches - Authority found applicant breached EA in failing to provide notice of termination as was obliged to - Authority declined to exercise discretion to award penalty - Found applicant already penalised by losing employment - Penalty declined - Operations manager
Result: Application dismissed (dismissal) ; Application granted (breach of contract)(counterclaim) ; Application dismissed (penalty)(counterclaim) ; Costs reserved
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