Auxton Computer Enterprises, Inc. v. Parker

• Decision Date: 21 May 1980
• Citation: Auxton Computer Enterprises, Inc. v. Parker, 174 N.J.Super. 418, 416 A.2d 952 (N.J. Super. App. Div. 1980)
• Parties: AUXTON COMPUTER ENTERPRISES, INC., Plaintiff-Respondent, v. David PARKER, Nikolaos Spiridellis and Spiridellis & Associates, Inc., Defendants-Appellants.
• Court: New Jersey Superior Court — Appellate Division

Page 418

174 N.J.Super. 418

416 A.2d 952

AUXTON COMPUTER ENTERPRISES, INC., Plaintiff-Respondent, v. David PARKER, Nikolaos Spiridellis and Spiridellis &amp Associates, Inc., Defendants-Appellants.

Superior Court of New Jersey, Appellate Division.

Argued May 6, 1980.

Decided May 21, 1980.

L. Steven Pessin, Iselin, for defendant-appellant David parker.

John L. Weichsel, Hackensack, filed brief in behalf of defendants-appellants Nikolaos Spiridellis and Spiridellis and Associates, Inc.

Thomas D. Ruane, Newark, for plaintiff-respondent (Robinson, Wayne & Greenberg, Newark, attorneys).

Before Judges LORA, ANTELL and PRESSLER.

The opinion of the court was delivered by

LORA, P. J. A. D.

Plaintiff Auxton Computer Enterprises, Inc. (Auxton) is engaged in the business of providing data processing consulting services and computer programmers as well as analysts on a contract basis to firms seeking such assistance. Defendant Spiridellis and Associates (Associates) is engaged in similar work. Defendant Nikolaos Spiridellis (Spiridellis), the president and principal officer of Associates, is and was the chief operating officer of that enterprise.

On June 22, 1972 defendant Parker entered Auxton's employ as a data processing consultant, assigned to work at various client-companies by Auxton. While on one such assignment at the American Broadcasting Company in 1975, Parker decided to look for another job and contacted several other prospective employers, including Spiridellis and Associates.

Parker and Spiridellis arranged for an interview, which Parker attended in January 1976 and which had been arranged by one Paul Chu, a former employee of Auxton who had gone to work for Associates. During that meeting Parker was questioned generally concerning his qualifications, and Spiridellis likewise informed Parker of the general operations of Associates.

The interview between Parker and Spiridellis ended favorably, with Spiridellis requesting Parker to return for an interview with one of Associates' senior technicians. That interview subsequently took place in February 1976. However, there was no job offer made to Parker at that time.

On March 18, 1976, a Thursday evening, Parker received a telephone call from Spiridellis, who asked him if he wanted to go for a technical interview the next day, March 19, 1976, at the offices of Pan American Corporation in Rockleigh, New Jersey, on behalf of Associates. Associates, which had been doing data processing consultative work for Pan Am for approximately six or seven months prior thereto, had an opportunity to enlarge their relationship with Pan Am by attending this technical interview with the prospect of providing their services with respect to Pan Am's passenger revenue data processing system which was then being either developed or improved upon. Associates had interviews lined up for five or six other technicians in addition to Parker.

When Spiridellis contacted Parker that evening, Parker, apparently suffering from a sore throat, did not give Spiridellis any definitive answer to his offer and request to have him appear in Rockleigh, New Jersey, on March 19, 1976. At the time Spiridellis called Parker, he knew that Parker was employed by plaintiff. However, neither Parker nor Spiridellis nor Associates had any knowledge that plaintiff was also seeking to obtain the Pan Am contract.

Parker subsequently determined to go to the Pan Am interview and called in sick insofar as his work at ABC on behalf of Auxton was concerned. On that day, by sheer coincidence, Lilla Leuchs, a marketing representative of Auxton, was at the offices of Pan Am trying to solicit work for Auxton from Pan Am, and learned that Parker was attending an interview there.

On the following Monday, the interview having taken place on Friday, a representative of Auxton confronted Parker with the fact that he had been at Pan Am the previous Friday. Parker initially denied having been there, but later decided to offer his resignation, which resulted, however, in his being terminated summarily by Auxton.

When Spiridellis learned of Parker's termination, he hired him, apparently due to a sense of moral obligation. Parker initially worked at a designated job site for two or three days, and then, upon receiving favorable approval from Pan Am, Parker went to work as an employee of Associates on the Pan Am job for a period of almost one year.

Auxton brought this claim against Parker, alleging breach of his duty of loyalty to his employer, interference with Auxton's prospective economic advantage and unfair competition. As against defendants Spiridellis and Associates, Auxton alleged that they had induced Parker to violate his duty of loyalty to plaintiff by recruiting him to solicit business for them while aware that Parker was still employed by Auxton. Following a bench trial and accounting of the losses Auxton allegedly sustained by reason of Parker's termination of employment in March 1976, the trial judge assessed damages jointly and severally against all defendants in the amount of $10,601.38. He further ordered that all counts in the complaint based upon alleged interference with prospective economic advantage and all requests for punitive damages be dismissed.

At oral argument we were advised that the matters in dispute between Auxton and Spiridellis and Associates had been settled while A-832-78 was pending in this court. Accordingly, the appeal and cross-appeal in A-832-78 are dismissed as moot. No costs.

Appellant Parker contends that the trial judge erred when he found that Parker had breached his duty of loyalty to Auxton. He asserts he was not soliciting Auxton's clients nor forming a rival corporation, but merely seeking other employment, which he had a clear right to do, and hence his conduct did not constitute a breach of duty of loyalty. Auxton, on the other hand, argues that Parker breached his duty of loyalty to Auxton by presenting himself to Pan Am as a representative of Spiridellis and Associates while in the employ of Auxton. It bottoms its position on the fact that Parker should have been at work on March 19, 1976, instead of attempting to secure work for a competitor of Auxton; Parker utilized his talents on behalf of a competitor of his employer, and Parker presented himself as an employee of Associates. Auxton suggests that, cumulatively, Parker's "actions were in callous 'disregard (of) his duty to serve his principal with only his principal's interest in mind.' " (Quoting Restatement, Agency 2d, § 394).

The trial judge, while finding that none of the defendants knew that Auxton was soliciting Pan Am's business, found from the "totality of the circumstances" a breach of the...