Summary
In Rush v. Newsom Exterminators, 261 Ala. 610, 75 So.2d 112, and Ivey v. Massey, 262 Ala. 365, 78 So.2d 926, the bills were held good where the restrictive contracts covered the entire State of Alabama.
Summary of this case from Parker v. Ebsco Industries, Inc.Opinion
6 Div. 688.
June 24, 1954. Rehearing Denied October 28, 1954.
Appeal from the Circuit Court, Jefferson County, E. M. Creel, J.
Bryan Chancey and Chas. B. Aycock, Birmingham, for appellant.
Equity will not entertain jurisdiction where there is an adequate remedy at law. Smith v. Roney, 182 Ala. 540, 62 So. 753; Standifer v. McWhorter, 1 Stew. 532. Injunction is discretionary remedy to prevent substantial injury, where no adequate remedy at law obtains. Hill v. Rice, 259 Ala. 587, 67 So.2d 789. Demurrer to bill should be sustained if any ground shows good reason for doing so. Montgomery v. Drinkard Auto Truck Co., 257 Ala. 685, 60 So.2d 823. Contracts restraining employment are looked upon with disfavor. Hill v. Rice, supra; Abalene Exterminating Co. v. Elger, 137 N.J. Eq. 1, 43 A.2d 165; Abalene Exterminating Co. v. Oser, 125 N.J. Eq. 329, 5 A.2d 738; Fulton-Grand Laundry Co. v. Johnson, 140 Md. 359, 117 A. 753, 23 A.L.R. 423; 126 A.L.R. 758; Code 1940, Tit. 9, §§ 22, 23.
Earl McBee, Winston B. McCall, Birmingham, and McKenzie, Kaler Shulman, Atlanta, Ga., for appellee.
Where there are two decrees of the same date, and where the appeal bond, citation of appeal and certificate of appeal do not describe the decree appealed from except by date, the appeal is not perfected sufficiently to confer jurisdiction of appeal, since neither appellate court nor adverse party is advised which appeal is attempted to be appealed from and it is as though no citation were served and no certificate of appeal made. Code 1940, Tit. 7, § 754; Wilkes v. Hawkins, 240 Ala. 85, 195 So. 446; Woodward Iron Co. v. Marbut, 183 Ala. 310, 62 So. 804; Weller Co. v. Camp, 169 Ala. 275, 52 So. 929, 28 L.R.A., N.S., 1106; Ex parte Williams, 226 Ala. 619, 148 So. 323. Want of jurisdiction does not require a motion to dismiss. Osbourn v. Lo Bue, 256 Ala. 121, 53 So.2d 610; Greenwood v. State ex rel. Bailes, 229 Ala. 630, 159 So. 91; Alston v. Marengo County Board of Education, 224 Ala. 676, 141 So. 658; Ex parte Alabama Textile Products Corp., 242 Ala. 609, 7 So.2d 303, 308, 141 A.L.R. 87. There can be no reversal on appeal by one of several defendants where such other defendants do not appear and join in the appeal and where there is failure to issue summons and serve such other defendants to appear and unite. Dinsmore v. Cooper, 212 Ala. 485, 103 So. 460. Appeal will be dismissed ex mero motu for want of proper parties. Sherrod v. McGruder, 209 Ala. 260, 96 So. 78. Errors assigned but not argued in brief are waived. Alabama Power Co. v. Thompson, 250 Ala. 7, 32 So.2d 795, 9 A.L.R.2d 974. Only such grounds of demurrer as argued will be considered on appeal. Martin Stamping Stove Co. v. Mauley, 260 Ala. 112, 69 So.2d 671. It is the policy of the law of Alabama to protect the good will of a going business by enforcing employee restrictive covenant contracts as well as such contracts in favor of the purchaser of the good will. Code 1940, Tit. 9, § 23; Shelton v. Shelton, 238 Ala. 489, 192 So. 55; Yost v. Patrick, 245 Ala. 275, 17 So.2d 240; McNeel Marble Co. v. Robinette, 259 Ala. 66, 65 So.2d 221; Hill v. Rice, 259 Ala. 587, 67 So.2d 789; Slay v. Hess, 252 Ala. 455, 41 So.2d 582.
Code 1940, Tit. 7, § 804 is in pertinent part as follows:
"Any party against whom a judgment or decree is rendered, may individually appeal to the Supreme Court or Court of Appeals without taking the appeal in the name of the other codefendant, but the clerk or register of the court from which the appeal is taken, shall issue a summons when the appeal is so taken, to such as do not join in the appeal to appear before the Supreme Court or Court of Appeals at the time to which the appeal is returnable, and unite in said appeal if he see proper, which summons may be served upon the party, or his attorney of record in the lower court."
Title 9, § 23 is as follows:
"One who sells the good will of a business may agree with the buyer, and one who is employed as an agent, servant, or employee may agree with his employer, to refrain from carrying on or engaging in a similar business and from soliciting old customers of such employer within a specified county, city, or part thereof, so long as the buyer or any person deriving title to the good will from him, and so long as such employer carries on a like business therein."
In this case a bill in equity was filed by Newson Exterminators, Inc., doing business as Arrow-Newson Exterminators, against S. T. Rush and others. The respondents objected to the allowance of the last amendment to the bill of complaint, made a motion to strike the amendment and also made a motion to strike the bill as last amended. The objections to the allowance of the last amendment to the bill of complaint and the motions, to which we have referred, were separately and severally overruled by decree of the lower court dated December 16, 1953. By separate decree, also dated December 16, 1953, the court overruled the demurrer to the amended bill of complaint as a whole and to each and every aspect thereof separately and severally.
Subsequently, in December 1953, an appeal was taken to this Court from the decree dated December 16, 1953. There is nothing to indicate from which of the aforesaid decrees the appeal was taken.
The first assignment of error is based on the action of the court "in decreeing on the 16th day of December, 1953, that the appellants' objection to the allowance of the last amendment to the bill of complaint, the appellants' motion to strike said amendment, and the appellants' motion to strike the bill as last amended be overruled, and in overruling said motions". The second, third and fourth assignments of error are based on the ruling of the court in overruling the demurrer and in overruling the demurrer to certain aspects of the bill of complaint.
It is obvious that the first decree dated December 16, 1953 is not an appealable decree. It is equally obvious that the decree of the court overruling the demurrer to the bill as to certain aspects of the bill is an appealable decree. Section 755, Title 7, Code.
It is insisted by the appellee that since there were two decrees on the same date, the appeal is not sufficiently perfected to confer jurisdiction on this Court because neither this Court nor the appellee can be advised from which decree the appeal is taken.
We are not willing to dismiss the appeal on this theory. We consider that the irregularity could have been corrected on motion made before the submission, but no such motion was made, and the cause was submitted on brief without objection. We will consider the appeal as having been taken from the decree which will support an appeal. Wynn v. Tallapoosa County Bank, 168 Ala. 469, 53 So. 228; Kelly v. Deegan, 111 Ala. 152, 156, 20 So. 378.
The jurisdiction of this Court also has been attacked on another theory. It is insisted that section 804, Title 7, Code applies and was not observed. It is true that if that statute does apply and was not observed, it would be necessary to dismiss the appeal ex mero motu. Sherrod v. McGruder, 209 Ala. 260, 96 So. 78; McKinstry v. Thomas, 258 Ala. 690, 64 So.2d 808.
The record in this case shows that a demurrer was filed to the bill of complaint by S. T. Rush and other respondents, and that the court entered an order overruling the demurrer. S. T. Rush and the National Surety Corporation acknowledged themselves as security for all costs of appeal to the Supreme Court. This security for costs was taken and approved by the register on December 30, 1953. On January 25, 1954 the register issued to the appellee or its solicitor of record a citation of appeal, reciting that the respondents herein have taken an appeal. The certificate of the register shows that the appeal was taken by the respondent S. T. Rush. However, the certificate of appeal, which was filed by the register in this Court on January 29, 1954, shows that the appeal was taken by the respondents. Assignments of error here have been made by the appellants (respondents) without naming them.
There may be some conflict in the record as to whether the appeal was taken by S. T. Rush or by all of the respondents in the lower court. In this connection the fact that the security for costs was signed only by S. T. Rush is not controlling. All that is necessary is that security for costs be given satisfactory to the register. McKinstry v. Thomas, supra.
Upon a consideration of the discrepancies mentioned above, we shall consider that the appeal has been taken by all the respondents to the bill in the trial court, and therefore section 804, Title 7, supra, has no application.
As we have said the first assignment of error is based on the action of the court in overruling appellants' objection to the allowance of an amendment to the bill and a motion to strike it. That ruling was made in a decree separate from that from which the appeal was taken. A decree overruling such an objection and motion to strike is not appealable. We have held that an appeal from an interlocutory decree authorized by statute will not support the assignment of a decree not subject to appeal at that time. That includes in the prohibition a decree which is not subject to appeal at any time. Comer v. Limbaugh, 256 Ala. 655(16), 57 So.2d 72. We cannot therefore consider the first assignment of error.
The bill seeks to obtain the benefit of section 23, Title 9, Code, as set up in both aspects of that statute. One of the respondents, Newsom, is alleged to have sold the good will of his business to complainant who also made a contract of employment with Newsom. In both contracts there was an agreement with Newsom to refrain from carrying on or engaging in a similar business or from soliciting old customers of complainant within the State of Alabama for a period of two years from the time when he should cease to be employed by complainant.
As to the other persons named as respondents they are alleged to have been employed by Newsom before and at the time he sold the business to complainant, with an agreement between them "and for the benefit of any successor in ownership of said business," restricting said employees from carrying on or engaging in a similar business or from soliciting old customers of such employer within the State for a period of two years from the time they ceased to be employed. The bill alleges that complainant employed them along with his purchase from Newsom and took an assignment of those employee contracts. It then alleges a conspiracy between them all, including Newsom, to let another former employee of Newsom, who was his confidential secretary (Miss Jackson) and who was also employed by complainant, set up a competing business in Jefferson County under the name of Birmingham Pest Control Company, with all the stock in her name except qualifying shares. That all the respondents went to work for said company in competition with complainant, and this was shown to be within two years or shortly after they left the employment of complainant.
The allegation is made that the employees were engaged by complainant under their alleged contract with Newsom, and as his successor in said business. But in furtherance of their conspiracy they are falsely taking the position that Newsom released them from their contract with him before they were employed by complainant. As to Newsom there is alleged a definite express contract in writing within the terms of section 23, Title 9, Code.
The question is whether the bill sufficiently meets the requirements of section 23, supra. It would hardly be contended that the period of two years was unreasonable as to time. The area specified is "Jefferson County or any other county in the State of Alabama". The statute (section 23) specifies the area for such contract to be a "county, city, or a part thereof".
In McNeel Marble Co. v. Robinette, 259 Ala. 66, 65 So.2d 221, we undertook to interpret and apply the meaning of those terms. We found it to mean that when a large territory is specified in a contract it means such part of it as is shown to be a reasonable area considering the facts and circumstances which are material to that inquiry. It cannot extend beyond what is specified, but the area should be drawn to apply only to a reasonable portion of the territory.
The bill should allege the facts and circumstances which are material to establish an area not exceeding the limits defined in it as is proper and reasonable for that purpose, and seek to make the contract effective in that area only.
The bill in this case does not undertake to show that the certain counties named in it are a reasonable area to meet the requirements of the statute. The injunction sought is as to certain counties of the State including Jefferson. It is insufficient in that respect. But appellants do not argue on this appeal that the bill is defective in that respect. Compare, Loftin v. Parker, 253 Ala. 98, 42 So.2d 824; Slay v. Hess, 252 Ala. 455, 41 So.2d 582; Shelton v. Shelton, 238 Ala. 489, 192 So. 55; Davis, Inc., v. Christopher, 219 Ala. 346, 122 So. 406. The views expressed by the writer of the opinion in Yost v. Patrick, 245 Ala. 275, 17 So.2d 240, in respect to the territorial limits prescribed in section 23, supra, were not concurred in by the Court.
In the case of Slay v. Hess, 252 Ala. 455, 41 So.2d 582, the Court was dealing with a contract of employment in the same sort of business as that here involved, with a covenant that for a period of five years, beginning August 1, 1947 (which was during the term of the contract of employment), he must not participate in any pest control work or similar business coming under the jurisdiction or supervision of the Alabama Department of Agriculture and Industries within a radius of one hundred miles of Sheffield, Alabama, without the written consent of the party of the first part. The relationship terminated June 30, 1948. The employee then opened a business in Sheffield, Alabama, and began furnishing pest control service to all persons who desired such service. The bill of complaint was filed to enjoin the employee from engaging in the business in violation of his contract. The trial court granted a temporary injunction from which an appeal was taken. This Court affirmed the decree.
In the instant case the right to a temporary injunction is not here involved. But the trial court overruled a demurrer to the bill. There is no difference in principle between it and the case of Slay v. Hess, supra, with the additional circumstance that Newsom was not only employed by complainant but he sold to complainant the good will of his business.
In passing on the rights and obligations of the parties here involved, we are not dependant upon common-law principles fixing the legal status of the parties or prescribing the circumstances when relief will be granted. Section 23, supra, relieves us of the necessity to make inquiry as to that. That statute is specific, though it did not at first apply to employer and employee relationship, but only to one who sold the good will of his business. Such was its status in the Code of 1923, section 6827. The change to its present form was made by the legislative act approved July 23, 1931, Acts 1931, page 647. There is no error in the decree overruling the demurrer of appellants to the bill insofar as the same is argued here in brief.
The decree should be affirmed.
The foregoing opinion was prepared by FOSTER, Supernumerary Justice of this Court, while serving on it at the request of the Chief Justice, under authority of Title 13, § 32, Code, and was adopted by the Court as its opinion.
Affirmed.
LAWSON, STAKELY, MERRILL and CLAYTON, JJ., concur.