In the recent case of Entello Pty Ltd v
Firooztash  QDC 50, a financial adviser has been
restrained for up to six months from soliciting or undertaking
professional services to clients of his former employer after
allegedly breaching restraint of trade provisions in his employment
The adviser's employment agreement with Entello Pty Ltd
contained confidentiality and restraint of trade clauses that
prohibited the adviser, upon resignation, from soliciting,
contracting, marketing or undertaking professional services to any
clients he had dealt with while being employed by Entello.
Prior to his resignation, the adviser managed 60 portfolios,
generating approximately $900,000 worth of income for Entello per
year. Following the adviser's resignation, Entello alleged that
it had lost over half of these portfolios and many, if not all,
were now being managed by the adviser's new employer, Financial
Entello contacted 16 of those clients who had moved across to
Financial Grace and gave evidence that out of those 16, two clients
had made the decision to move their business to Financial Grace
after conversations with the adviser. In hearing Entello's
application for an interlocutory injunction, Farr J agreed that the
evidence provided by Entello regarding these two clients could
arguably amount to solicitation. However, both clients had since
denied Entello's version of the conversations. As the other 14
clients did not raise the issue of solicitation, it was held there
was insufficient evidence to find the adviser was in breach of his
employment agreement on this ground.
Despite this, based on the evidence given by Entello in
combination with adviser's failure to deny providing
professional services to clients that he had dealings with during
his employment at Entello, Farr J found that a reasonable inference
could be made that the adviser was undertaking such services to
some clients in breach of his employment agreement.
It was held that the restraint of trade provisions were both
necessary and reasonable and designed to protect the legitimate
interests of Entello. Accordingly, Entello had established a
serious question to be tried and as such granted Entello
The hearing of the matter is expected later this year.
This case is a good win for employers who wish to enforce
reasonable restraints on former employees to protect their business
Winner ? EOWA Employer of Choice for Women Citation 2009, 2010,
2011 and 2012
Winner – ALB Gold Employer of Choice 2011 and 2012
Finalist – ALB Australasian Law Awards 2008, 2010, 2011 and
2012 (Best Brisbane Firm)
Winner – BRW Client Choice Awards 2009 and 2010 - Best
Australian Law Firm (revenue less than $50m)
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