Crowe Horwath (Aust) Pty Ltd v Loone

(2017) 54 VR 517; [2017] VSCA 181

Victorian Court of Appeal

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Interrogate

Catchwords

1. Contract
2. › Employment contracts
3. › Restraint of trade
4. › Enforceability following employer's repudiation
5. › Whether restraint clause survives termination by employee's acceptance of employer's repudiatory conduct
6. › Whether contractual language preserving restraint 'in all circumstances' alters result
1. Contract
2. › Termination
3. › Repudiation
4. › Employer and employee
5. › Whether employer's conduct in changing employee's duties and bonus entitlements constituted repudiatory breach
6. › Whether employee entitled to rely on repudiatory conduct occurring after decision to leave
1. Equity
2. › Injunctions
3. › Restraint of trade
4. › Discretionary refusal of relief
5. › Whether employer who has repudiated contract can obtain equitable relief to enforce restraint clause
6. › Clean hands
7. › He who comes to equity must do equity
1. Practice and Procedure
2. › Appeal
3. › Leave to appeal
4. › Whether proposed grounds had real prospect of success
5. › Whether applicant permitted to raise new arguments on appeal
6. › Whisprun Pty Ltd v Dixon (2003) 77 ALJR 1598

Quick Take

A restraint of trade clause in an employment contract is unenforceable by an employer whose repudiatory conduct has been accepted by the employee, regardless of contractual language stating the restraint survives termination 'in all circumstances and for any reason'. The Victorian Court of Appeal confirmed the consistent line of authority from General Billposting through Kaufman and Geraghty, holding that such language is 'merely writ in water'. The case also confirms that an employee who has decided to leave employment may still rely on subsequent repudiatory conduct by the employer occurring before the employee formally accepts the repudiation.