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WORLDWIDE ROTA DIES SDN BHD V RONALD ONG CHEO
WORLDWIDE ROTA DIES SDN BHD V RONALD ONG CHEO
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1. WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
Client/Matter: -NoneSearch Terms: pledge tort
Search Type: Natural Language
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MY Cases
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Judgment Date:
25/2/2010
Labour Law— Employment— Employee’s duty— Duty of fidelity and good faith—
Confidential information
and trade secrets — Confidential information in form of list of customers, cost
prices, specificneeds and
requirements of customers — Employee utilising and revealing confidential
information to
employer’scompetitor — Whether employee in breach
Evidence— Adverse inference— Failure of plaintiff to call certain witness to
support plaintiff’sevidence—
Existence of documentary evidence and admission by defendant supportingplaintiff’s
evidence— Whether
adverse inference drawn — Evidence Act 1950 s 114(g)
Contract— Breach— Damages— Exemplary damages— Whether defendant’s conduct tainted
by malice,
fraud, cruelty and insolence — Whether defendant profiting from breaches — Whether
defendant utilising
trade secrets to detriment of plaintiff
Contract— Restraint of trade— Validity of restraint of trade clause— Whether
restraint of trade clause valid
and enforceable— Whether restraint permissible to prevent misuse of trade secrets
or business connexion
— Whether reasonable to extend restraint across globe — Whether restraint of trade
clause reasonable —
Whether s 28 of the Contracts Act 1950 to be considered flexibly and with regard to
commercial reality —
Contracts Act 1950 s 28
Held, allowing the plaintiff’s claim with costs: (1) By enticing, encouraging
and influencing the
plaintiff’s employees to leave the employment of the plaintiff to join Alpha
while the defendant was still in the
employment of the plaintiff, the defendant had acted in conflict and was therefore
guilty of breach of contract. The
defendant himself did not dispute that he took 50% of the staff strength of the
plaintiff to Alpha when he joined
Alpha (see para 53). (2) The defendant had utilised the plaintiff’s list of
customers by pinching the
plaintiff’s customers. This was done by the defendant notwithstanding the
injunctive court order dated 6
October 1997 which expressly prohibited the defendant from pinching the
plaintiff’s customers. At the
subsequent contempt proceedings, the learned judge had warned the defendant that he
was to cease contravening
the court order but the defendant continued to defy the court order (see paras 57 &
59). (3) Confidential information
would also cover information relating to customers, cost prices together with the
specific needs and requirements of
customers. The defendant had access to all these and he did not deny them. The
irresistible inference could be
drawn that the defendant was guilty of revealing and utilising the confidential
secrets of the plaintiff when the
defendant joined Alpha. This amounted to breaching cll 8 and 9 of the letter of
offer (see para 83). (4) Section
114(g) of the EA could not be invoked against the plaintiff because there was a
letter from Alpha showing
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
Alpha’s list of customers (’exh D23’) that supported PW1’s
evidence that the
defendant pinched the plaintiff’s customers. The defendant had also admitted
that he had secured 12 of the
plaintiff’s customers as reflected in exh D23. That admission put an end to
the s 114(g) submission (see
paras 88-89). (5) The express duty imposed by a contract of employment to maintain
confidence is at its peak while
the employment is continuing. But that does not give the employee the right to
disseminate confidential information
belonging to the employer after the employee has left the employment (see para 95).
(6) The defendant had
committed the tort of unlawful interference with the plaintiff’s trade for
the following reasons: (a) by
encouraging and/or influencing the plaintiff’s employees to leave the
employment of the plaintiff; (b) by
failing to keep all information obtained in the course of his employment
confidential; (c) by divulging the
plaintiff’s confidential information to the plaintiff’s competitor; and
(d) by misrepresenting to the
plaintiff’s customers with the sole aim of damaging the plaintiff’s
reputation and/or business (see para
106). (7) Restraint is permissible if it is fashioned in such a way as to prevent a
misuse of trade secrets or business
connexion. In what form the restraint of trade is to be incorporated is irrelevant.
What is relevant is the contents of
that restraint. The restraint may be contained in an agreement or in a letter. The
geographical area of the restraint
must be viewed in the context of the ease of travel and the character of the
business that is under scrutiny. And in
the world where companies operate globally, it would be reasonable to extend the
restraint across the globe (see
paras 116-117 & 119). (8) The restraint of trade clause in this case as agreed by
the defendant was not draconian
and was not in breach of the rules of natural justice. Based on the facts of this
case, the restraint of trade clause
was reasonable (see para 123). (9) In considering s 28 of the Act, there must be
some measure of flexibility. The
commercial reality of the matter dictates this kind of approach. Regard must always
be had to the nature of the
business conducted by the employer. The test of reasonableness must be applied in
construing a restraint of trade
clause (see para 126). (10) Whenever the defendant’s conduct is sufficiently
outrageous to merit
punishment in situations where the defendant’s conduct discloses malice,
fraud, cruelty, insolence or the
like, then exemplary damages would be granted. The defendant had profited from the
breaches in the present case.
The plaintiff’s trade secrets had been utilised by the defendant to the
detriment of the plaintiff (see paras
138, 140 & 153). (11) In cases of trade secrets and confidential information,
damages will not be an adequate
remedy because it is always difficult to quantify them. If the plaintiff can show
that there exists a real risk of future
injury, the plaintiff would be granted a permanent injunction (see para 154)
Summary : Madam Tan (‘PW1’), the general manager of the plaintiff by way of a
letter of offer of
appointment dated 21 August 1995 offered to the defendant the position of marketing
manager of the plaintiff. The
defendant accepted that job offer and signed an acceptance pledging his loyalty to
the plaintiff. By way of another
letter dated 30 July 1996 addressed to the defendant, PW1 confirmed the defendant’s
appointment and again the
defendant pledged his loyalty to the plaintiff. Clause 7 of the letter provided
that the defendant was not permitted
whilst in the employment of the plaintiff to engage in any private business which
could tantamount to any conflict of
interest. Clauses 8 and 9 provided that the defendant had to, at all times, ensure
confidentiality of the plaintiff’s
proprietary and other confidential information. Such information was to remain as
the property of the plaintiff and
cannot be divulged to any outside party. Clause 10 provided that upon the
defendant’s resignation, he sh
18/9/2023
MYHC
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
3/8/2023
MYMT
4/7/2023
MYCA
5/12/2022
MYHC
1/10/2022
MYSESSC
7/3/2022
MYHC
2/9/2021
MYMC
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
28/5/2021
MYHC
25/1/2021
MYHC
[2021] MLJU 77
Referred
24/11/2020
MYHC
9/11/2020
MYCA
3/2/2020
MYCA
30/12/2019
MYHC
Page 5 of 28
WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
Referred
14/10/2019
MYHC
1/9/2017
MYHC
30/9/2016
MYHC
13/9/2016
MYHC
31/5/2016
MYHC
31/5/2016
MYHC
Page 6 of 28
WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
11/3/2016
MYHC
16/5/2014
MYCA
29/3/2013
MYHC
Referred
12/2/2013
MYHC
Referred
17/10/2012
MYHC
Considered
2/5/2012
MYHC
Page 7 of 28
WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
10/2/2012
MYHC
Referred
18/1/2012
MYHC
Distinguished
24/11/2011
MYHC
31/1/2007
MYHC
Referred
1/3/2001
UKHL
[2001] UKHL 8;
Referred
26/6/1997
MYHC
5/6/1997
MYHC
19/5/1995
MYHC
2/3/1984
NZCA
Referred
11/2/1982
UKHL
[1982] 2 WLR 322
Referred
4/6/1981
UKHL
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
[1982] AC 173;
[1981] 3 WLR 33
Referred
[1978] QB 69;
22/4/1977
EWCACIV
[1977] 3 WLR 90
Referred
17/7/1962
-
Referred
3/12/1951
-
Referred
8/5/1935
EWCACIV
28/3/1930
EWCACIV
[1916] 32 TLR
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
2/11/1895
EWCACIV
[1896] 1 QB 147
Referred
10/7/1895
EWCACIV
ROBB v GREEN
[1895] 2 QB 315
Referred
Referred
EWCA
ALLEN v FLOOD
[1898] AC 1;
[1895] All ER Rep 52;
[1897] 67 LJQB 119;
[1897] 77 LT 717;
125;
[1898] 14 TLR 125
[1897] 62 JP 595;
[1897] 14 TLR
Referred
AMBER SIZE AND CHEMICAL CO LTD v
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
MENZEL
[1913] 2 CH 239
Referred
Referred
Followed
Referred
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
[1987] IRLR 3
Referred
[1945] 2 KB 570
Referred
[1988] 1 CH 61
;
[1988] 2 WLR 1191;
Referred
[1988] 1 AC 1013
Referred
EWHCCH
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
[1969] RPC 41
Referred
[1965] 1 QB 623;
Referred
EWCA
CONWAY v WADE
[1909] AC 506
Referred
[1951] 1 KB 805
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
Referred
Referred
[2004] EWHC 44
Referred
[1899] 1 Ch 300
Referred
Referred
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
Referred
[1978] CH 122;
Referred
[1987] Ch 117;
[1986] IRLR 69;
Referred
[1987] 1 CH 117
Referred
Referred
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
[1918] 35 TLR 87
Referred
FRANCHI v FRANCHI
[1933] 1 CH 935
Referred
EWHCCH
[1933] Ch 935
Referred
GOLDSOLL v GOLDMAN
[1914] 2 Ch 603
Followed
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
[1983] 1 AC 228
Referred
HAGG v DARLEY
[1878] 47 LJ Ch 567
Referred
HAGG v DARLEY
[1878] 47 LJCH 567
Referred
HAYNES v DOMAN
[1899] 2 Ch 13;
Referred
HOWATSON v WEBB
[1908] 1 Ch 1;
[1907] 77 LJ Ch 32;
[1907] 97 LT 730
Referred
[1930] 1 MC 175;
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
EWCA
Referred
Referred
JONES v FABBI
[1973] 37 DLR_3d 27
Referred
EWCA
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
[1965] AC 269;
[1964] 3 WLR 541
Referred
[1904] 91 LT 363
Referred
Referred
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
Referred
[1982] AC 187
Referred
[1990] 2 QB 479;
Referred
Referred
LUMLEY v GYE
Referred
LUMLEY v GYE
LUMLEY v GYE
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
Referred
Referred
[1970] 2 QB 114;
Referred
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
Referred
Referred
[1966] 1 OR 285
Referred
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
[1964] 2 OR 547
Referred
[1919] 1 KB 244
Referred
QUINN v LEATHEM
Referred
[1983] Ch 135
Referred
Referred
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
[1964] AC 1129
Referred
Referred
SANDERS v PARRY
[1967] 2 All ER 803;
Referred
-
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WORLDWIDE ROTA DIES SDN BHD v RONALD ONG CHEOW JOON
Referred
[1988] Ch 449;
[1988] 2 WLR 1280
Referred
TIPPING v CLARKE
[1843] 67 ER 157;
Referred
Provisions
s 114(g)
Provisions
s 28
End of Document