Oakton Services Pty Ltd v Glenn Anthony Tessari & Ors [2008] ACTSC 87 (3 September 2008)

Last Updated: 25 September 2008

OAKTON SERVICES PTY LTD v GLENN ANTHONY TESSARI & ORS

[2008] ACTSC 87(3 September 2008)

EX TEMPORE JUDGMENT

No. SCC 729 of 2008

Judge: Higgins CJ

Supreme Court of the ACT

Date: 3 September 2008

IN THE SUPREME COURT OF THE )

) No. SCC 729 of 2008

AUSTRALIAN CAPITAL TERRITORY )

BETWEEN: OAKTON SERVICES PTY LTD ACN 100 103 268

Plaintiff

AND: GLENN ANTHONY TESSARI

First Defendant

AND: DEBORAH ELIZABETH PARSONS

Second Defendant

AND: WAYNE LESLEY FULLER

Third Defendant

AND: ANTHONY ROSS GARDNER

Fourth Defendant

AND: GRADERN PTY LIMITED

ACN 113 607 677

Fifth Defendant

AND: NORTHCOTT PARTNERS PTY LTD ACN 131 317 309

Sixth Defendant

ORDER

Judge: Higgins CJ

Date: 3 September 2008

Place: Canberra

THE COURT ORDERS THAT:

1. Pending the final determination of proceedings or further order, the first, second, third, fourth, fifth and sixth defendants be restrained from providing or supplying, including as an employee of one or other of those defendants, directly or indirectly to the Personnel Administration Branch Defence Support Group of the Department of Defence (“Department”), pursuant to any contract (“Contract”) awarded in response to the Department’s Request for Tender RFT PAB 2008/01 – Supply of Professional Service Provider Capability to Support PMKEYS, ADFPAY and CENRESPAY Functional Analysis and Issue Management.

2. The restraint in order 1 does not operate to restrict the provision of advice to the Department as to the current status of work in progress of the Contract and any critical issues of which the Department may need to be advised, by close of business 4 September 2008.

3. The first, second, third, fourth, fifth and sixth defendants be restrained from disclosing or using the plaintiff’s confidential information.

4. Costs be reserved.

1. It seems to me that in the circumstances as they are deposed to in the affidavits of the plaintiff, notwithstanding the affidavits of the defendant which can only be used, as I have indicated, for a limited purpose, there is a prima facie case that the sixth defendant obtained the contract which it has with the Department of Defence - and I will use that term in a general way because there is no such thing as the Department of Defence in any structural sense, it is a division of the Commonwealth - by means of representing that they had the services, and were entitled to the services, of the persons who are the first, second, third and fourth defendants. I note the fifth defendant is simply an entity associated with one of those named persons.

2. Effectively, the case of the plaintiff is that the defendants obtained the contract by representing that they had the services of these persons which were necessary in order that they might be considered for it. Those persons were already persons who were associated with the plaintiff. The negotiations which led to the bids being put in for the tenders were such that those persons were, and each of them were, in the employ of the plaintiff at the time when the tender bids were (a) prepared, and (b) submitted. If that case is made out then it would be a grave breach of fiduciary duty; it would, in effect, amount to the illegal transfer of the assets of one company to another and, of itself, that would justify an order restraining those persons from providing services to the sixth defendant for the purpose of the sixth defendant being able to bid for or obtain or carry out any contract which it had obtained alleging those persons were free to be used.

3. There is also the question, which is additional to that, of the restraint of trade clauses. I note in Mr Tessari’s case, certainly on the face of it, it only applies to New South Wales so no doubt it would be argued that that would be in error and indeed it is suggested that it is an obvious error which ought to be rectified by virtue of the rectification claim which is made. As to the others, that does not apply. So, as I say, it seems to me that at least at the prima facie level a case for a restraint is made out. However, it is still discretionary. The question then is: what is the balance of convenience and of justice? If the restraints are valid as alleged, and if the breaches are made out as alleged, then it is quite clear that the Department of Defence, to use that term in respect of it, has taken advantage of a situation in which they are receiving in effect, and I do not use this term technically, “stolen goods”. They can hardly complain if they are refused access to those goods, if that is the consequence of it.

4. The other aspect of it is that there is obviously an effect on the persons concerned if they are restrained and that is relevant. However, it seems to me that, on the assumption which must be made for the purpose of this application, their interests are better served by being restrained than not.

5. I have said enough about the matter at this level, it is better, usually, not to go into great detail about it. I would simply say that I will make the orders which are sought, firstly in respect of paragraph one of the application restraining each of the first to six defendants from providing or supplying services, including as an employee of one or other of those defendants, directly or indirectly to the Personnel Administration Branch Defence Support Group of the Department of Defence, pursuant to the named contract. I further order that the same defendants be restrained from disclosing or using the plaintiff’s confidential information, though I appreciate that there is a problem of specificity with respect to that. I add that costs are reserved.

6. I further make the qualification referred to in paragraph 2 of the General Form of Order, and the directions in the Short Minutes of Order provided by the parties.

I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Chief Justice Higgins.

Associate:

Date: 3 September 2008

Counsel for the plaintiff: Mr R M Goot SC

Solicitor for the plaintiff: Minter Ellison

Counsel for the first, second, third,

fourth, fifth and sixth defendants: Mr M Heath

Solicitor for the first, second, third,

fourth, fifth and sixth defendants: Williams Love & Nicol

Date of hearing: 2 and 3 September 2008

Date of judgment: 3 September 2008