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2016 MarsdenLR 344

COURT OF APPEAL PUTRAJAYA
GANESH RAJA NAGAIAH & ORS – Appellant
Versus
NR RUBBER INDUSTRIES SDN BHD – Respondent
[Civil Appeal No: K-02(NCVC)(W)-608-04-2016]



Petitioner Advocates:Victor Paul Dorai Raj ,Respondent Advocate: Chan Chen Choong

A trial judge must accurately assess confidentiality claims, ensuring clear distinctions between confidential information and general commercial practices to avoid oppressive injunctions.

Headnote:The court addressed a breach of confidentiality claim concerning wide injunctions sought by the plaintiff against former employees and their new business. The trial judge failed to properly distinguish between confidential information and restraint of trade, leading to an oppressive ruling against the defendants. The appeal was allowed, and the High Court's decision set aside for lack of adequate identification of the confidential information being claimed.

Table of Content
1. breach of confidentiality not distinguished from restraint of trade. (Para 1 , 2 , 3)
2. prayers were too broad and oppressive. (Para 4 , 10)
3. the court emphasized the necessity for clear and precise legal arguments. (Para 5 , 7 , 8 , 14 , 15)
4. pleadings required specificity regarding confidential information. (Para 6 , 12 , 16)
5. failure by trial judge to analyze breaches. (Para 9 , 11)
6. appeal allowed and costs ordered. (Para 17 , 18)
[1] The appellants/defendants appeal against the decision of the learned trial judge who had allowed a claim in essence for breach of confidential information not only against the 1st appellant who was the former Manager of the respondent/plaintiff but also against the 2nd and 3rd appellants who are partners of a business known as GPMR Trading.

[2] What is important to note in this case is that the learned trial judge has failed to make a distinction in relation to prayers related to breach of confidential information and prayers relating to restraint of trade. The prayers of the respondent does not identify the nature of the information which the respondent is seeking an injunction taking into consideration that it is an admitted fact that the GPMR Trading is a business which is trading similar products to that of the respondent. The prayers in fact, are oppressive in nature in particular of the 2nd and 3rd appellants, taking into consideration the pleadings, evidence and the law relating to restraint of trade which warrants the trial court to dismiss the plaintiff's case at limine.

[3] The prayers in the statement of claim (which was repeated in the sealed order) read as follows:

"(a) an injunction to restrain the 1st defendant from disclosing trade secrets, trade mechanism list of customers/suppliers, contact numbers, method of contacting plaintiff customers/suppliers, offer price, source and condition of the plaintiff's (respondent's) products for sale including list of forwarders and the related cost to third party.

(b) an injunction to restrain the 1st, 2nd and 3rd defendant (appellants) trading as GPMR Trading from contacting and soliciting and entering into any transaction in respect of sale and purchase of natural and synthetic rubber with the plaintiff's (respondent's) customers/suppliers as stated in Schedule A to the Statement of Claim.

(c) mandatory injunction to compel the 1st, 2nd and 3rd defendants (appellants) trading as GPMR Trading to surrender to the plaintiff (respondent) all records information with regard to trade secrets, trade mechanism list of customers/suppliers, contact numbers, method of contacting plaintiff customers/suppliers, offer price, source and condition of the plaintiff's (respondent's) products for sale including list of forwarders and the related cost.

(d) all accounts of profit/benefits generated by the 1st, 2nd and 3rd defendants (appellants) trading as GPMR Trading to be paid to the plaintiff (respondent).

(e) the 1st, 2nd and 3rd defendants (appellants) trading as GPMR Trading to forthwith refund to the plaintiff (respondent) all commission/payment deposited/received from the forwarders, customers, suppliers agents in the defendants' (appellants') following accounts since 2012 till the date of the judgment.

(f) General damages to be assessed.

(g) Cost of RM10,000.00."

[4] The lengthy Memorandum of Appeal of the appellants, inter alia, reads as follows:

"1. Yang Arif Hakim yang bijaksana telah khilaf dari segi fakta dan undang-undang apabila membenarkan tuntutan responden terhadap perayu-perayu.

2. Yang Arif Hakim yang bijaksana telah khilaf dari segi fakta dan undang-undang apabila memutuskan bahawa responden telah membuktikan kausa tindakan terhadap perayu-perayu.

3. Yang Arif Hakim yang bijaksana telah khilaf dari segi fakta dan undang-undang apabila memutuskan bahawa cara operasi/mekanisme perniagaan ('trading') responden cara hubungan pelanggan dan pembekal responden wajar diperlindungi melalui injunksi sedangkan ianya adalah merupakan seba

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