Protecta Security Pty Ltd v Daney

The applicant, Protecta Security Pty Ltd, took over Coastal Security in Knysna in April 2024 and inherited its employees, including the respondent, Roger Daney. The respondent signed an employment contract dated 5 April 2024 (backdated to 4 February 2024) as a Technical Manager. He resigned on 10 May 2024 after less than two months, citing dissatisfaction with a newly imposed three-month probation period. His last day was 24 May 2024. He then took up employment with Allsound Security CC, the applicant's biggest competitor in Knysna, stationed at Pezula Private Estate supervising security officers. The applicant sought to enforce a restraint of trade clause preventing the respondent from working for any competitor in South Africa for three years.

• Whether the restraint of trade clause was reasonable and enforceable
• Whether the applicant had a protectable proprietary interest (trade secrets, confidential information, customer connections) warranting protection
• Whether the respondent's employment with Allsound Security CC threatened any protectable interest of the applicant
• Whether the restraint was contrary to public policy due to its excessive duration (3 years) and geographical scope (entire country)
• Whether the parties bargained on an equal footing

The application was dismissed. The court imposed a conditional alternative: should the respondent no longer be stationed at Pezula Private Estate and perform work as a Technical Manager for Allsound Security CC, he would be interdicted and restrained for 12 months until 23 May 2025 within the Southern Cape district. Each party paid their own costs.

A restraint of trade that bars an employee countrywide for three years, where the employee was employed for less than two months, had no access to trade secrets or customer relationships, and had skills common to the industry, is unreasonable and contrary to public policy. The enforceability of a restraint depends on the existence of an actual protectable interest, the nature of the employee's role, the bargaining position of the parties, and proportionality in duration and geographic scope. An undertaking to protect confidential information cannot substitute for an unreasonably broad restraint clause.

The court noted that while the respondent's duties might currently not infringe the applicant's interests, nothing precludes his employer from shifting him to a competing role; therefore a conditional limited restraint was imposed. The court also indicated it gave 'lateral leeway' to the respondent as an in-person litigant, allowing some arguments not fully contained in the opposing affidavit as long as they did not manifestly deviate from it.

The case illustrates the limits of restraint of trade enforcement where an employee is in a junior role, employed for a very short period, without access to genuine trade secrets, and where the restraint is disproportionately broad in time and geography. It reinforces that restraints exist to protect legitimate proprietary interests, not merely to suppress competition, and that courts will scrutinize the equality of bargaining power between parties when assessing reasonableness.