New real estate school owner runs afoul of ex-employer

A judge has ordered the operator of a new school that provides instruction to would-be real estate agents to stop competing with his former employer.

B.C. Supreme Court Justice Nitya Iyer granted an injunction against Richard Zhao from operating his school pending the outcome of a trial.

Quick Pass Master Tutorial School Ltd., a company that offers real estate-related tutorial programs to help Mandarin-speaking people planning to take B.C.’s real estate licensing exams, had sued Zhao after he terminated his contract with them and set up the new school.

In June 2017, Zhao — who immigrated to Canada in 2013, is fluent in English and Chinese and has 20 years’ experience in marketing — signed contracts with Quick Pass agreeing to teach real estate tutorials for a term of two years, ending in June 2019.

The contracts included an agreement stipulating that he was prohibited from competing with Quick Pass in Vancouver, Burnaby or Richmond following any termination of the contracts.

In September 2017, Zhao informed Benson Min Hung Wang, the owner of Quick Pass, that he intended to quit working for the company and planned to open his own school, which would compete directly with Quick Pass.

Zhao opened his business on Nov. 1, 2017, the day after he terminated his contracts, and advertised on WeChat, a social media platform that is popular in the Chinese community. The Zhao school opened in Burnaby, a city named in the noncompetition clause of the contract.

After the new school opened, Wang claimed Quick Pass had experienced a noticeable decline in the number of its clients and said that he was aware that some former Quick Pass clients had switched over to the Zhao school.

In the court ruling, the judge decided against granting an order that would prohibit Zhao from soliciting students from Quick Pass, but ordered an “interlocutory” injunction against him from competing with his former company.

“Turning first to the non-competition clause, I find that in the circumstances, the balance of convenience favours Quick Pass,” said the judge.

“Quick Pass’ claim is relatively strong, and if it succeeds, damages will be hard to quantify. Granting the injunction will only require Mr. Zhao to relocate his school to accord with the contracts he signed.”

The injunction prevents Zhao from competing with the plaintiff in any aspect of the business of providing real estate training anywhere in Vancouver, Burnaby and Richmond until April 30, 2019, or until the trial.