A top KwaZulu-Natal private school has hauled its “neighbouring” competitor to court after the headmaster of one resigned and later took up a position at the other.
Ashton International College, in Ballito, went to court to stop its former headmaster and MD Petrus Erasmus from taking up employment with Curro Primary School, in the neighbouring village of Salt Rock.
Ashton claimed Erasmus was under a “restraint of trade”.
But this week, Durban high court judge Johan Ploos van Amstel, said the agreement was not enforceable.
The judge said there was no information to support the alleged trade secrets, connections with customers or confidential information. The curriculum was also not confidential.
Ploos van Amstel heard Ashton’s interdict application at the end of December. Erasmus opposed the interdict, while Curro filed a notice to abide by the decision of the court. On the same day, the judge dismissed it with costs, because schools were due to open in January.
He handed down his reasons this week.
Ashton, he said, contended it was one of the biggest private schools on the KwaZulu-Natal north coast.
Curro College was a trade rival offering the same services. They competed in the same community for student attendance and against each other in sporting events.
Erasmus took up the post as headmaster of Ashton in January 2010. In May that year he bought a 6% share in the school and in 2017 he was promoted to MD.
He resigned in August 2021, saying he was taking early retirement.
Then, 16 months later, Curro announced he had been appointed as its head of primary school effective January 2023.
Ashton’s attorneys, in correspondence with Erasmus, claimed he was in breach of “confidentiality and restraint undertakings”, which were contained in a mutual separation agreement.
A restraint clause such as the one the applicant wants to enforce is against public policy and unenforceable if its sole aim is to stifle competition.
— Judge Ploos van Amstel
Ploos van Amstel said the agreement provided that Erasmus would not, for a period of two years, be employed by any company which rendered “competing services” within a radius of 50km.
He said the agreement was “poorly drafted” and appeared to be a “cut and paste exercise”.
He said there were many shortcomings in Ashton’s case — a fundamental one relating to a “protectable interest”.
“A restraint clause such as the one the applicant wants to enforce is against public policy and unenforceable if its sole aim is to stifle competition,” judge Ploos van Amstel said.
“By way of example, if a salesperson in a shoe shop is offered a better salary by a competing shoe shop he will ordinarily not be bound by a restraint clause because there is nothing to protect.
“That the salesperson may be experienced and competent does not justify restraining him from changing his employment. Public policy demands that businesses should be allowed to compete and individuals to work and ply their trade freely, whatever they choose.
“This is why the law requires a protectable interest for a restraint clause to be enforceable. It is to protect the employer’s confidential information from falling into the hands of a competitor.”
The judge said Ashton referred to its unique and enhanced curriculum, trade secrets, relationships and tailor-made deals with long-standing customers; the relationships that Erasmus had developed with strategic partners, including suppliers, parents and customers.
But there was no information with regard to the nature of any of this so-called confidential information.
“There is no evidence to suggest that the Ashton curriculum is confidential ... as a matter of probability, a school’s curriculum is available to any parent who is considering sending a child there.”
The judge said Erasmus, in his answering affidavit, denied that any of the information was confidential or that there were trade secrets or connections.
The curriculum was set by the Independent Examinations Board (IEB) which was used by most private schools.
“He says his skill and ability to head a school is a product of his own experience and expertise over the years in the teaching profession. He is good at what he does and that is recognised. He is a well-known member of the Salt Rock community and known to be skilled at running a school,” Ploos van Amstel said.
“It must be clearly understood that a school is not entitled to enforce a restraint of trade agreement to prevent an employee from moving to a competing school if its sole purpose is to retain, for example, a popular or particularly competent teacher or headmaster, or to prevent a competitor from acquiring his services.”
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