Winnipeg Livestock Sales Ltd. v. Plewman et al.,

• Jurisdiction: Manitoba
• Judge: Scott, C.J.M., Philp and Steel, JJ.A.
• Neutral Citation: 2000 MBCA 60
• Citation: 2000 MBCA 60,(2000), 150 Man.R.(2d) 82 (CA),192 DLR (4th) 525,[2001] 1 WWR 153,[2000] MJ No 429 (QL),150 Man R (2d) 82,[2000] M.J. No 429 (QL),192 D.L.R. (4th) 525,150 Man.R.(2d) 82,150 ManR(2d) 82,(2000), 150 ManR(2d) 82 (CA)
• Date: 07 June 2000
• Court: Court of Appeal (Manitoba)

Winnipeg Livestock v. Plewman (2000), 150 Man.R.(2d) 82 (CA);

    230 W.A.C. 82

MLB headnote and full text

Temp. Cite: [2000] Man.R.(2d) TBEd. SE.027

Winnipeg Livestock Sales Ltd. (plaintiff/respondent) v. Desmond Plewman and Grunthal Livestock Auction Mart Limited (defendants/appellants)

(AI 00-30-04567; 2000 MBCA 60)

Indexed As: Winnipeg Livestock Sales Ltd. v. Plewman et al.

Manitoba Court of Appeal

Scott, C.J.M., Philp and Steel, JJ.A.

September 15, 2000.

Summary:

Plewman was engaged by Winnipeg Live­stock as an independent contractor to provide auctioneering services. The contract con­tained a restrictive covenant which pro­vided that for a period of 18 months fol­lowing the termination of his services, Plewman would not solicit business from or provide livestock auctioneering services to any person within the Province of Manitoba who was, or was likely to be, in competition with Winnipeg Livestock. Plewman left Winnipeg Live­stock, purchased an interest in Grunthal Livestock Auction Mart and commenced providing auctioneering and other services to Grunthal. Winnipeg Live­stock obtained an interim injunction against Plewman and Grunthal to enforce the restrictive covenant. Plewman and Grunthal appealed.

The Manitoba Court of Appeal allowed the appeal, holding that the restrictive covenant was not reasonable.

Contracts - Topic 6732

Illegal contracts - Contrary to public policy - Restraint of trade - Agreements not to compete - Plewman was engaged by Win­nipeg Livestock as an independent con­tractor to provide auctioneering services - The contract contained a restrictive coven­ant which provided that for a period of 18 months following the termination of his services, Plewman would not solicit busi­ness from or provide livestock auc­tioneer­ing services to any person within the Prov­ince of Manitoba who was, or was likely to be, in competition with Winnipeg Live­stock - Plewman left Winnipeg Live­stock, pur­chased an interest in Grunthal Livestock Auction Mart and commenced providing auctioneering and other services to Grun­thal - Winnipeg Livestock obtained an interim injunction against Plewman and Grunthal to enforce the restrictive covenant - Plewman and Grunthal appealed - The Manitoba Court of Appeal allowed the appeal - The restrictive covenant was not reasonable where: (1) Winnipeg Livestock had not established that it had a legitimate proprietary interest in its customer con­nections; and (2) the restrictive cov­­enant prevented competition generally and there were no exceptional circumstances justify­ing the prohibition.

Contracts - Topic 6732

Illegal contracts - Contrary to public policy - Restraint of trade - Agreements not to compete - The Manitoba Court of Appeal held that the requirement that a restrictive covenant in an employment contract must be reasonable between the parties and with reference to the public interest was also applicable with respect to independent contractor relationships - See paragraphs 21 to 24.

Injunctions - Topic 5971

Particular matters - Restrictive covenants - Covenants not to compete - [See first Contracts - Topic 6732 ].

Master and Servant - Topic 1323

Contract of hiring (employment contract) -Covenants in restraint of trade - Restrictive covenants - Whether reasonable - General -[See both Contracts - Topic 6732 ].

Master and Servant - Topic 1324

Contract of hiring (employment contract) -Covenants in restraint of trade - Restrictive covenants - Whether reasonable - Interest protected - [See first Contracts - Topic 6732 ].

Cases Noticed:

Miller v. Toews (1990), 70 Man.R.(2d) 4 (C.A.), refd to. [para. 12].

Apotex Fermentation Inc. et al. v. Novopharm Ltd. et al. (1994), 95 Man.R.(2d) 241; 70 W.A.C. 241 (C.A.), refd to. [para. 12].

Krahn Enterprises Ltd. v. Big Apple Imports Ltd. et al. (1992), 82 Man.R.(2d) 106 (Q.B.), refd to. [para. 12].

Collins (J.G.) Insurance Agencies Ltd. v. Elsley Estate, [1978] 2 S.C.R. 916; 20 N.R. 1, refd to. [para. 16].

Herbert Morris Ltd. v. Saxelby, [1916] A.C. 688 (H.L.), refd to. [para. 18].

Jostens Canada Ltd. v. Gendron (1993), 1 C.C.E.L.(2d) 275 (Ont. Gen. Div.), refd to. [para. 20].

Deacons (A Firm) v. Bridge, [1984] 2 All E.R. 19 (P.C.), refd to. [para. 22].

Salloum et al. v. Thomas (1986), 12 C.P.R.(3d) 251 (B.C.S.C.), refd to. [para. 22].

Sacallis v. Georgia Pacific Securities Corp., [1998] B.C.J. No. 2987 (Prov. Ct.), refd to. [para. 22].

Dynamex Canada Inc. v. Miller et al. (1998), 161 Nfld. & P.E.I.R. 97; 497 A.P.R. 97 (Nfld. C.A.), refd to. [para. 23].

Maguire v. Northland Drug Co., [1935] S.C.R. 412, refd to. [para. 27].

Jiffy Foods Ltd. v. Chomski, [1973] 3 O.R. 955, refd to. [para. 27].

Fitch v. Dewes, [1921] 2 A.C. 158 (H.L.), refd to. [para. 27].

White (Marion) Ltd. v. Francis, [1972] 1 W.L.R. 1423 (C.A.), refd to. [para. 27].

Routh v. Jones, [1947] 1 All E.R. 179 (Ch. D.), affd. [1947] 1 All E.R. 758 (C.A.), refd to. [para. 27].

Taylor (T.S.) Machinery Co. v. Biggar (1968), 2 D.L.R.(3d) 281 (Man. C.A.), refd to. [para. 29].

American Building Maintenance Co. v. Shandley (1966), 58 D.L.R.(2d) 525 (B.C.C.A.), refd to. [para. 29].

Stenhouse Australia Ltd. v. Phillips, [1974] 1 All E.R. 117 (P.C.), refd to. [para. 36].

Campbell, Imrie and Shankland v. Park, [1954] 2 D.L.R. 170 (B.C.S.C.), refd to. [para. 36].

Doerner v. Bliss & Laughlin Industries Inc. et al., [1980] 2 S.C.R. 865; 34 N.R. 168, refd to. [para. 37].

Friesen and Hamilton v. McKague (1992), 81 Man.R.(2d) 290; 30 W.A.C. 290 (C.A.), refd to. [para. 38].

Ernst & Young v. Stuart (1993), 50 C.P.R.(3d) 142 (B.C.S.C.), refd to. [para. 39].

Williams Restaurant Supply Ltd. v. Leadley (1994), 96 Man.R.(2d) 211 (Q.B.), refd to. [para. 40].

Cradle Pictures (Canada) Ltd. v. Penner, [1978] O.J. No. 471 (H.C.), affd. [1982] O.J. No. 1566 (C.A.), refd to. [para. 40].

Cannon v. Island Acoustics (Courtenay) Inc. (1996), 69 C.P.R.(3d) 73 (B.C.S.C.), refd to. [para. 40].

Phytoderm Inc. v. Urwin (1999), 90 O.T.C. 262 (Gen. Div.), refd to. [para. 40].

Rapid-Med Plus Franchise Corp. v. Elliott et al. (1991), 73 Man.R.(2d) 150; 3 W.A.C. 150 (C.A.), refd to. [para. 41].

Authors and Works Noticed:

England, Geoffrey, Christie, Innis, and Christie, Merran, Employ­ment Law in Canada (3rd Ed. 1998) (Looseleaf), §11.35 [para. 27].

Counsel:

W.S. Gange, for the appellants;

D.G. Douglas and J.B. Hirsch, for the respondent.

This appeal was heard on June 7, 2000, before Scott, C.J.M., and Philp and Steel, JJ.A., of the Manitoba Court of Appeal. The following judgment of the Court of Appeal was delivered by Scott, C.J.M., on Sep­tember 15, 2000.