The Run Corp pantomime has just started another act, with the Australian Financial Review reporting that the property management company has obtained a Federal Court injunction against well-known Sydney agent, John McGrath. Run is alleging that McGrath, a former Run director who resigned from the company in July, has breached a “non-compete” agreement.

In an announcement to the ASX, Run alleged that:

Despite contractual, statutory and fiduciary obligations owed to Run, McGrath has established franchises that compete with Run and has recently stated that McGrath intended to resume property management business in NSW.

McGrath is counter-claiming, alleging that he was “sold a pup” when he agreed to sell his rent roll to Run in 2005 (for $12 million). As part of the sale, McGrath became a substantial shareholder in Run.

Run Corp has had a torrid time as a listed entity. After hitting the boards at $1 in 2005, the company has racked up losses of more than $23 million. In June 2007, it signed a strategic alliance with property management company, Elders (which is owned by Futuris). As part of the deal, Elders injected between $6 and $10 million into the company. Without the cash injection, an independent expert noted that Run may have breached its banking covenants.

While Run made a small profit before interest, tax, depreciation and amortisation this year, the bottom line is still ugly, with the company losing $17 million in the year ending 30 June 2007.

McGrath would not have been overjoyed with how his investment in Run has performed. His stake, which was originally valued at $4.25 million, is now worth about $412,000.

McGrath is an extremely successful agent who founded McGrath Estate Agents in 1989 as a one-man operation (which now turns over $2.4 billion in property sales) and was a founding director of RealEstate.com.au. McGrath Estate Agents appeared on BRW’s Fastest Growing Companies list on four separate occasions. BRW estimated McGrath’s wealth to be $50 million in 2003, when he appeared in BRW’s Young Rich List.