IN THE COUNTY COURT OF VICTORIA
AT Melbourne
COMMERCIAL DIVISION	Revised
(Not) Restricted
Suitable for Publication	
General List

Case No. CI-21-00069

Evans Road Medical Centre Pty Ltd (ACN 615 140 988)	Plaintiff	
		
v		
		
Faisal Siddiqi

and

F & S Professionals Pty Ltd (ACN 619 059 488)	First Defendant

Second Defendant	

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JUDGE:	HER HONOUR JUDGE MARKS	
WHERE HELD:	Melbourne	
DATE OF HEARING:	16 February 2021	
DATE OF RULING:	17 February 2021 (ex temp); written ruling 7 May 2021	
CASE MAY BE CITED AS:	Evans Road v Siddiqi 	
MEDIUM NEUTRAL CITATION:	[2021] VCC 545		

R U L I N G 
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INJUNCTION – RESTRAINT OF TRADE – BREACH OF CONFIDENCE – NON-SOLICITATION CLAUSE – medical clinic seeking to restrain doctor from working within 1 km of the clinic – restraint of trade clause in agreement – restraint of trade clause not valid  –  no evidence confidential information taken – no evidence solicitation – injunction not granted – turns on own facts.
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APPEARANCES:
	Counsel	Solicitors	
For the Plaintiff	Mr A Di Stefano	Boadicea Legal Services 	
			
For the Defendants	Mr M M Minucci	Ganci Huggett Lawyers 
(as Town agent for Abrahams & Associates)	

HER HONOUR:

1	Evans Road Medical Centre Pty Ltd, the plaintiff,  seeks an interlocutory injunction against the first defendant,  Dr Siddiqui. (His name is spelt Siddiqi in the title to this proceeding).
2	An originating motion and summons were filed in January 2021. The summons was argued before me on 16 February 2021, and I delivered an oral ruling the following day, refusing the injunction sought.  I was later asked for written reasons, which follow.
3	The question before me was whether or not the interlocutory injunction sought should be granted. 
4	The plaintiff filed two sets of submissions, the first defendant one.  Affidavits were filed from Dr Singh (the plaintiff’s director’s husband), Ms McAuley (the plaintiff’s solicitor), and by the first defendant.  The background to the matter is detailed in the affidavits. 
5	McAuley’s affidavit was not able to be sworn due to the COVID-19 lockdown, and there were some objections in relation to the weight to be given to it, based on it containing some hearsay evidence.  
6	Even taking into account the matters raised by McAuley, I am not persuaded that the plaintiff has made out a prima facie case for the injunction. 
7	The plaintiff set up the Evans Road medical clinic (the plaintiff’s clinic). In October 2018, the trustee for Evans Road Medical Centre Trust and the first defendant entered into an agreement called  ‘Service Agreement’. It recorded terms on which the first defendant ‘shall occupy a part of the Premises’ at which the plaintiff’s clinic operated, and, relevantly, included a restraint clause.    
8	In his affidavit the first defendant said he had not signed the Service Agreement that the plaintiff was relying on (which appeared to have the first defendant’s signature.)  However, counsel for the first defendant then said that for purposes of this application, the first defendant conceded that the agreement relied on by the plaintiff, with the apparent signature of the first defendant, was the relevant agreement.  So I will refer to that agreement as the Service Agreement.
9	Between October 2018 and December 2020, the first defendant treated patients, for which the second defendant (his related services company, which I will call the company in this ruling)  was paid around $850,000.
10	In mid 2020, the company entered into a shareholders’ agreement with a number of others, in relation to a different clinic proposed to be established in Cranbourne West, about a kilometre from the plaintiff’s clinic (the rival clinic).  The plaintiff knew nothing about this at that stage.  
11	In December 2020, the plaintiff became aware that the rival clinic was opening, and sought assurances from the first defendant that he was not involved with it. 
12	On 4 January 2021 the first defendant posed a note on his Facebook page, saying he had decided to open his own medical centre in the new Cranbourne West shopping centre.  
13	Since then, various staff have left the plaintiff’s clinic to go to the rival clinic.  The plaintiff is also concerned about patients being solicited away from the plaintiff’s clinic to the rival clinic.  The plaintiff issued this proceeding, seeking the injunctive relief.
14	By the time of the hearing, the company had left the shareholding arrangement in relation to the rival clinic.  The first defendant had worked briefly at other clinics in the intervening time, but wants to be able  to work at the rival clinic.  At the time of the hearing before me he had not commenced working there, due to the dispute with the plaintiff about whether he is entitled to.
15	The plaintiff’s case at the hearing before me depended on the effect of the restraint of trade clauses in the Service Agreement, whether or not confidential information was provided to the first defendant in the first place, and whether there was an equitable breach of the duty of confidence by the first defendant.
16	To obtain an injunction there must be a prima facie case in the sense of having demonstrated a serious question to be tried.  Damages must not be an adequate remedy, and the balance of convenience must favour granting the injunction.  
17	In this case, I am not satisfied that a prima facie case has been established in relation to the relief that is sought. 
18	I set out below the various orders sought by the plaintiff, as updated in its second submissions.
Confidential information
19	The order that is sought relating to confidential information is that:
1.	The First Defendant is to deliver up to the Plaintiff all patient information and confidential information obtained while engaged by the Clinic and is to otherwise destroy all other copies of same.  
20	The plaintiff has not established a prima facie case that the first defendant has any information that is confidential belonging to the plaintiff which he has obtained while engaged at the plaintiff’s clinic.  The plaintiff has not established that any such information has been used.  There is certainly evidence that the plaintiff is concerned confidential information was taken, but that does not go high enough.  
21	The plaintiff invites me to infer that confidential information must have been taken in order for the first defendant to have treated some former patients of the clinic, at other clinics since leaving the plaintiff’s clinic.  I am not prepared to infer that.  It seems to me that anyone can walk into a doctor’s office and obtain some treatment  – or indeed perhaps have a Telehealth discussion these days – without having to have their previous records there.  Further, the first defendant has given evidence that many of the patients whom he treated at the plaintiff’s clinic were previously his own clients, and went with him to the plaintiff’s clinic initially when he started there. In that circumstance, he would already have had some of those records.  I am not prepared to infer that confidential information must have been taken by the first defendant from the plaintiff in order for the first defendant to treat clients elsewhere.
22	The plaintiff relies on a Facebook comment of 4 January 2021 on the first defendant’s Facebook page, where a Facebook ‘friend’ (probably one of his patients) commented ‘When are you moving will take records this time cheers’. The plaintiff argues this suggests the first defendant took the plaintiff’s records.
23	There was nothing on the Facebook comments by way of a response to the ‘take records’ comment by the first defendant. His reply to her was simply, ‘hopefully next week is when we kick off’.
24	I am not prepared to infer from that comment that it is more likely than not that the first defendant in fact took records from the plaintiff.  If anything, it seems to me to go the other way.  It suggests that records were not taken on the previous occasion when the first defendant moved clinics (but that his Facebook friend suggested they should be taken this time). Thus, this comment does not add support to an inference that it was the first defendant’s practice for him to take records when leaving a clinic, or support the suggestion he took records on this occasion.
25	The  plaintiff submits that the orders sought are substantially the same as those in  Australian Cardiology Services Pty Ltd v Rudd [2020] VSC 645 (Rudd) and relies on that case. But the evidence relied on here is quite different to that in Rudd.   There, there was substantial evidence from many patients of their medical records having been used at a new clinic and that they had been contacted by the doctor concerned.  They had provided statements.  Most significantly, there was evidence that the relevant doctor had accessed the plaintiff’s database which contained patient records and contact details. The defendant in that case sought to excuse it, but as Her Honour Ierodiaconou AsJ made clear, since that data belonged to the plaintiff, that was the end of it.  It had been used; that was a breach of confidentiality.  
26	There is no such evidence in this case.
Restraint of trade
27	The plaintiff seeks to restrain the first defendant from contacting its patients and staff and from setting up a practice within 5 kilometres of the plaintiff’s clinic.  
28	It relies on clause 9 of the Service Agreement:
9)	RESTRAINT ON DOCTOR AFTER TERMINATION OR EXPIRY OF 	SERVICE AGREEMENT PERIOD DEFINED BY CLAUSE 1.
a)	The Doctor, HEREBY ACKNOWLEDGES AND AGREES with the clinic that: 
b)	In consideration of the matters set out in this Agreement, the Doctor HEREBY COVENANTS with the Clinic that the Doctor will not (without the prior written consent of the Clinic) either on the Doctor’s own account or in conjunction with or on behalf of any other person or persons (whether as principal, manager, employee, contractor, agent or otherwise), whether directly or indirectly:
i.	solicit the custom of any person with whom or which the Doctor may have dealt in respect of medical services from the Premises prior to the termination of this Agreement;
ii.	solicit or entice away from the Clinic any person who is or has been during the period of 3 (three) year [sic] prior to the date employed by the Clinic, whether or not such person would commit a breach of his or her contract of employment by reason of leaving service; or
iii.	solicit or entice away any patient of the clinic for a period of 3 (three) year [sic]; or set up practice or work within a 5 km radius of the clinic or any practice conducted by the clinic at the time of termination of this Agreement.  
Law 
29	The law in relation to restraint clauses is strict. The starting position is that a restraint clause is void unless it can be justified as a reasonable measure in the interests of both parties such that it provides no more than adequate protection to the beneficiary of the restraint, whilst at the same time not being injurious to the public: Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd  (1973) 133 CLR 288.
30	Restraint clauses are interpreted strictly, as set out by the Court of Appeal in the decision of Wallis Nominees (Computing) Pty Ltd v Pickett [2013] VSCA 24 at [14]. A contractual provision in restraint of trade is prima facie void.  The presumption can be rebutted by the special circumstances of a particular case, if the restriction is reasonable having regard to the interests of the parties.  The validity of the covenant in a contract is to be judged as at the date of the employment agreement.  A stricter view is taken of covenants in restraint of trade in employment contracts than those contained in contracts for the sale of a business.  The onus of proving the special circumstances justifying the restraint is on the person seeking to enforce the covenant, and so far as the parties’ interests are concerned, the restraint must impose no more than adequate protection to a party in whose favour it is imposed.  If the court is satisfied the restraint confers greater protection than can be justified, there is no further issue of reasonableness.
31	The meaning of the restraint clause can be construed by reference to the factual matrix, its documentary context and surrounding circumstances.
32	In the case before me, the restraint clause relied on is poorly drafted. The clause does not give the protection that the plaintiff comes to court seeking.  Whilst the plaintiff is right to say that the courts must endeavour to construe an agreement in a way that will give effect to what the parties have agreed, what is sought to be made of the clause by the plaintiff here goes well beyond construing it. It amounts to seeking to rewrite it.
Restraint sought
33	The order that is sought in relation to contact is:
2.	Until further order, the First Defendant be restrained from contacting in any way, directly or indirectly, any patients he treated whilst at the Clinic, and staff of the Clinic.
3.	Order 2 does not apply to those patients who provide their consent to the Plaintiff to having their patient information and confidential information related to them provided to the First Defendant. 
34	The plaintiff relies on clause 9 in the Service Agreement. 
35	Sub-clause (b)(i), is extremely broad.  It is directed to stopping the first defendant soliciting the custom of.
 …any person with whom or which the Doctor may have dealt in respect of medical services from the Premises prior to the termination of this Agreement  
36	The Macquarie Dictionary definition of solicit,  relevantly is:
1.	to seek for by entreaty, earnest or respectful request…
2.	to entreat or petition..
3.	to seek to influence or incite to action, especially unlawful or wrong action. 
…
37	Sub-clause (b)(i) goes well beyond referring only to patients, even though the injunction is only sought in relation to that.  The first defendant could have ‘dealt with in respect of medical services from the premises’ various other ‘persons’ such as sales people and staff at the clinic. Having dealt with someone in respect of medical services does not necessarily mean that the first defendant provided medical services to those people.  The clause goes beyond what is reasonable in protecting the plaintiff’s interests.
38	Sub-clause (b)(iii) provides, relevantly,  that the first defendant is not to :
solicit or entice away any patient of the clinic for a period of 3 (three) year [sic]; …
…
39	Sub-clause (b)(iii) is too wide to be reasonable. It is not limited to any patient the first defendant has worked with whilst at the clinic, or was introduced to at the clinic. It covers any patient of the clinic, even if he had never met them whilst at the clinic. 
40	In any event,  there is no evidence that the first defendant solicited any of the clinic’s patients. 
41	The Facebook post (mentioned above) does not seem to me to amount to solicitation.  I take into account that the concept of solicitation can be very broad (see Dixon J in Epichealth Pty Ltd v Yang [2015] VSC 516 about the breadth of the concept of solicitation at [36]). But  I do not accept that a doctor announcing on his Facebook page (that happens to have some patients joined as ‘friends’) that he is setting up to work somewhere else amounts to solicitation. That is what happened here.  
42	Sub-clause 9(b)(ii) provides that the first defendant must not:
 solicit or entice away from the Clinic any person who is or has been during the period of 3 (three) year [sic] prior to the date employed by the Clinic, whether or not such person would commit a breach of his or her contract of employment by reason of leaving service; 
43	I first pause to note that there is not even a mention of when the three-year term is to start (three years prior to what date?)  Secondly, it is too broad.  It could cover people who were not involved with the first defendant in any way whilst he was employed. It could cover someone he had not even met who had been at the clinic in that three year period (whenever it commenced). 
44	 I am also not satisfied that there is evidence of breach.   Whilst the plaintiff is aware staff have left the plaintiff’s clinic to go to the rival clinic, there is no evidence of them being solicited in some way.  If a new clinic was being set up, once it is set up people will be aware of it generally in any event.  People can have various reasons for leaving their employment without solicitation having occurred.  The first defendant said he had no involvement in their decisions.  That may or may not be so, but it is for the plaintiff to satisfy me there is something to show that there was solicitation. The plaintiff says it is implausible they left without contact from the first defendant.  Contact is not that same as solicitation.
45	The order sought in relation to where the first defendant should not practise is :
4.	Until further order, the First Defendant is restrained from practicing at the Cranbourne West Shopping Centre or any other location within 5 kilometres of the Evans Road Medical Clinic. 
46	Sub-clause 9(b)(iii) of the Service Agreement provides that the first defendant must not:
solicit or entice away any patient of the clinic for a period of 3 (three) year [sic]; or set up practice or work within a 5km radius of the clinic or any practice conducted by the clinic at the time of termination of this Agreement.  
47	The restraint here confers greater protection for the plaintiff than can be justified.  There is no time limit imposed as to when the 5 kilometre restraint is to continue.  The plaintiff’s argument depended on me being persuaded that it is possible to read clause 9(b)(iii) so that the three year period set up before the semi-colon has something to do with the prohibition against setting up practice or working within a 5 kilometre radius after the semi-colon. Counsel for the plaintiff quite properly conceded that unless it is possible to be construed in that way, it would be unreasonable just to have a blanket prohibition of setting up within the 5 kilometre radius from the plaintiff’s clinic.   I am not satisfied that the prohibition on setting up practice or work that was agreed between the parties had any time period whatsoever.    
Balance of convenience
48	Given my findings above, I do not get to the question of the balance of convenience in this case. If I had needed to,  I would have considered that, in a case as weak as this, the balance of convenience, in any event, would have favoured the first defendant not being injuncted pending the trial of this proceeding. I am not persuaded that the trial of this proceeding would be able to be brought on quickly (as was urged by counsel for the plaintiff).  There are many complexities to it.  For it to be brought, evidence will need to be compiled, and then the Court would need to have time to hear it.  The first defendant has given evidence about his financial position, his young family, his desire to work near them, and his limited work options. I am not persuaded in those circumstances that the balance of convenience would have favoured the injunction being ordered pending trial in this particular case.
Costs
49	The first defendant seeks costs in the circumstances.  The first defendant says that an immediate order for costs is justified because the plaintiff’s case was not established by the plaintiff and it was incumbent on the plaintiff to put on the material that would establish its case.
50	Counsel for the plaintiff points to timing issues, that this has been brought on fairly quickly.  He mentioned issues related to the lockdown and said there were difficulties in obtaining the sort of evidence that might be required in any event at this stage.  I am not persuaded by that.  I have seen interlocutory injunction applications which are as simple as a brief affidavit in a case such as this by a patient or two saying they were solicited, for example, or evidence that could indicate that records had in some way been taken.  There was some suggestion in Dr Singh’s affidavit (for the plaintiff) that there might be more evidence to indicate that records had been copied.  However,  by the time of the hearing in mid-February that evidence had not been provided.  More importantly, costs usually follow the event.  In this case, the plaintiff has sought an injunction and has been unsuccessful.  It is my view that the primary reason the plaintiff has been unsuccessful is not something that could have been fixed by evidence in any event.  It is the wording of the restraint clause that was determinative.  Certainly, so far as confidential information allegedly being taken, further evidence might have been relevant, but there has been ample time to provide that evidence. 
51	I do not consider the circumstances are such that an order for the immediate payment of costs is appropriate. There has not been any behaviour by the plaintiff to take the matter outside the making of the usual order as to costs.  Merely being unsuccessful on an application is not a reason to order immediate payment of costs.
52	The order in relation to costs (made on 17 February 2021) is:
The plaintiff pay the defendants’ costs of and incidental to the summons filed 13 January 2021, on the standard basis to be taxed in default of agreement.  

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Certificate
I certify that these 11 pages are a true copy of the reasons for ruling of Her Honour Judge Marks, delivered on 7 May 2021, revised on 11 May 2021.  
Dated: 11 May 2021                                   

Zeinab Ali 
Associate to Her Honour Judge Marks

11/ May/ 2021