COMM 393 Chapter Notes - Chapter Case: Niche Market
COMM 393 Phoenix Restorations Ltd. v. Brownlee Case Briefs
[2010] B.C.J. No. 2455
2010 BCSC 1749
76 B.L.R. (4th) 282
2010 CarswellBC 3372
Docket: S107276
British Columbia Supreme Court
Facts
• Mr. Paul Brownlee is 33 years old. After signing a non-compete employment contract (Agreement) and
working for Phoenix Restorations Ltd for 4 years, he resigned and commenced employment at Belfor
Canada Inc.
• Phoenix is a British Columbia corporation specializing in restorations from damage, having operated for 29
years. 0% of Phoei’s usiess oes for a ihe arket i the idustr, diretl fro propert
management companies. Phoenix is a leading provider of restoration services in the market.
o Two of Phoei’s ajor liets are Cros Propert Maageet Ltd ad Assertie Propert
Maageet, aoutig for 30% of Phoei’s usiess.
o 5% of Brolee’s ork as i the ihe arket, ad 0% of Brolee’s ork as for Cros
and Assertive
• The insurance restoration business is highly competitive – Belfor and Phoenix consider themselves
competitors
• Brownlee signed three employment contracts with Phoenix during three promotions, all of which
contained non-competition and non-solicitation provisions
• After commencing employment at Belfor, Brownlee was assigned to manage restoration projects, and has
visited the offices of Crosby and Assertive.
• Phoenix seeks an injunction to enforce both non-compete and non-solicitation clauses to prevent
irreparable harm
• Brownlee opposes on the grounds that the restrictive covenants are a restraint of trade, ambiguous, and
should not be enforced. Brownlee also specifies that he has worked in the industry in many years, and an
injunction would cause him significant hardship. If the covenants are enforceable, Brownlee seeks to pay
damages instead of having an injunction.
Issues
• Is the non-competition clause enforceable?
• Is the non-solicitation clause enforceable?
• Should an injunction be granted?
• Is payment of damages a fair remedy in this situation?
Reasons
Law: British Columbia A.G. v. Wale B.C.L.R d , [] W.W.R C.A., aff’d [] S.C.R
• in granting an injunction, the court must be satisfied that
o there is a fair question to be tried
o the balance of conveniences favours the granting of the injunction
Law: RJR-MacDonald Inc. v. Canada (A.G.), [1994] 1 S.C.R 331.
• the test for an injunction is as follows
o whether the applicant has demonstrated that there is a serious question to be tried (or in certain
circumstances a strong prima facie case)
o whether the applicant will suffer irreparable harm if the injunction is not granted and
o whether the balance of convenience favours granting the injunction
• a prolonged examination of the merits is not needed (not trying the actual case; only whether a fair
question exists is enough to pass the first test) unless:
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Document Summary
Facts: mr. paul brownlee is 33 years old. After signing a non-compete employment contract (agreement) and working for phoenix restorations ltd for 4 years, he resigned and commenced employment at belfor. Phoenix is a british columbia corporation specializing in restorations from damage, having operated for 29 years. (cid:1013)0% of phoe(cid:374)i(cid:454)"s (cid:271)usi(cid:374)ess (cid:272)o(cid:373)es for(cid:373) a (cid:374)i(cid:272)he (cid:373)arket i(cid:374) the i(cid:374)dustr(cid:455), dire(cid:272)tl(cid:455) fro(cid:373) propert(cid:455) management companies. Phoenix is a leading provider of restoration services in the market: two of phoe(cid:374)i(cid:454)"s (cid:373)ajor (cid:272)lie(cid:374)ts are cros(cid:271)(cid:455) propert(cid:455) ma(cid:374)age(cid:373)e(cid:374)t ltd a(cid:374)d asserti(cid:448)e propert(cid:455) Ma(cid:374)age(cid:373)e(cid:374)t, a(cid:272)(cid:272)ou(cid:374)ti(cid:374)g for 30% of phoe(cid:374)i(cid:454)"s (cid:271)usi(cid:374)ess: (cid:1013)5% of bro(cid:449)(cid:374)lee"s (cid:449)ork (cid:449)as i(cid:374) the (cid:374)i(cid:272)he (cid:373)arket, a(cid:374)d (cid:1012)0% of bro(cid:449)(cid:374)lee"s (cid:449)ork (cid:449)as for cros(cid:271)(cid:455) and assertive. Phoenix seeks an injunction to enforce both non-compete and non-solicitation clauses to prevent irreparable harm: brownlee opposes on the grounds that the restrictive covenants are a restraint of trade, ambiguous, and should not be enforced.
