Burkhalter & Co. v. Wissner

• Decision Date: 17 June 1992
• Docket Number: No. 89-CA-0765,89-CA-0765
• Citation: 602 So.2d 835
• Parties: BURKHALTER & COMPANY, a Professional Association, and System Solutions, Inc. v. Kenneth F. WISSNER, Jr. and Abacus Data Services, Inc.
• Court: Mississippi Supreme Court

Page 835

602 So.2d 835

BURKHALTER & COMPANY, a Professional Association, and System Solutions, Inc. v. Kenneth F. WISSNER, Jr. and Abacus Data Services, Inc.

No. 89-CA-0765.

Supreme Court of Mississippi.

June 17, 1992.

Janet McMurtray, Fred Krutz, III, Daniel J. Mulholland, Forman Perry Watkins & Krutz, Jackson, for appellants.

W. Nye Patterson, Sharon Patterson Thibodeaux, Patterson & Thibodeaux, Jackson, John C. McLaurin, McLaurin & McLaurin, Brandon, for appellees.

Before ROY NOBLE LEE, C.J., and ROBERTSON and SULLIVAN, JJ.

ROBERTSON, Justice, for the Court:

I.

Today's appellants are the former employers of a data processing specialist who left his original employment and opened a like business of his own. All of this is said to be in violation of the original employment agreement, termination agreement and covenant not to compete. The Chancery Court granted summary judgment to the former employee, whose former employers now appeal. We reverse and remand.

II.

Burkhalter & Company is a professional accounting firm based in Jackson, Mississippi. In addition to conventional accounting services, Burkhalter designs and sells computer software to its clients to enable them to perform in-house some of their own accounting and bookkeeping. It provides this computer accounting service through a separate corporation, currently known as SSI, Inc. Burkhalter and SSI are hereinafter collectively labeled "Burkhalter."

In July of 1983, Burkhalter employed Kenneth F. Wissner, Jr., who had experience in data processing and in designing computer software programs. Burkhalter hired Wissner because of this expertise and assigned him particularly to prepare software programs to perform accounting operations such as billing, accounts receivable, accounts payable and the like, for local telephone companies which were Burkhalter's clients. Incident to his employment, Wissner accepted a duty to respect the confidentiality of Burkhalter's commercial and client information and signed an agreement to this effect. Wissner also agreed that, should he leave Burkhalter's employ, he would not engage in a competitive business for three years thereafter. The covenant not to compete contained a clause which reads:

The CDP [Wissner] agrees that the Corporation [Burkhalter] would suffer great loss and damages if, during the CDP's employment or within three (3) years subsequent to the date of termination thereof, the CDP should, for himself or on behalf of any other person, persons, partnership or corporation by whom he may be subsequently employed or interested, solicit, either directly or indirectly, or in any manner whatsoever render accounting services to any person, persons, partnership or corporation serviced by the Corporation or to be serviced by the Corporation. [Emphasis added]

In March of 1986, Wissner left Burkhalter's employ and in connection therewith executed an Employment Termination Agreement. In this agreement Wissner reacknowledged his duties of confidentiality, of respect for Burkhalter's property rights, and not to compete. He also represented

[Wissner] has, upon termination, turned over to [Burkhalter] all files, source codes, documentation, record of professional services rendered or software written by him under the terms of the Employment Agreement. All these files, returns, software memoranda and correspondence belong to [Burkhalter] and shall remain the property of [Burkhalter].

Soon thereafter, Wissner formed a new corporation, Abacus Data Services, Inc. Wissner is an incorporator, shareholder, director, officer, and employee of Abacus which, we are told, is in competition with Burkhalter in the sales of computer programs designed to provide telephone companies with accounting services. Specifically, it appears Wissner and Abacus have provided services to at least two of Burkhalter's customers, Hughes Telephone and Pine Belt Telephone, less than three years after Wissner's termination. The services Wissner provided to Hughes and Pine Belt were virtually identical to those he was providing these customers while employed at Burkhalter.

On February 21, 1989, Burkhalter & Company and Systems Solutions, Inc., filed suit in the Chancery Court of Rankin County, Mississippi, naming Kenneth F. Wissner and Abacus Data Services, Inc., as defendants. Burkhalter alleged Wissner had breached his duties of confidentiality, respect for property rights, and non-competition. Wissner and Abacus answered and counterclaimed, alleging tortious interference with business relations.

On April 12, 1989, less than two months after Burkhalter filed suit, Wissner and Abacus moved for summary judgment on all issues. In the meanwhile, Burkhalter had pursued discovery and, in fact, had pending a motion to compel discovery in which it charged Wissner and Abacus with providing inadequate responses. Notwithstanding its failure to rule on Burkhalter's motion to compel, the Chancery Court, on May 23, 1989, granted summary judgment, finding that Burkhalter "had failed to demonstrate to this court that there is a genuine issue of fact for trial."

III.

In their briefs before this Court, the parties contest vigorously whether the Burkhalter-Wissner agreement extended to the data processing services Wissner was providing post-1986 through Abacus Data Services, Inc. The agreement quoted above prohibits Wissner from rendering "accounting services" in competition with Burkhalter and in violation of the agreement. Wissner would have us hold this language limited to traditional accounting services such as bookkeeping, auditing and the like.

Concerning construction of this critical language, we note UHS-Qualicare, Inc. v. Gulf Coast Community Hospital, 525 So.2d 746 (Miss.1987).

It is said that the first rule of contract interpretation is to give effect to the intent of the parties. Sumter Lumber Co. v. Skipper, 183 Miss. 595, 608, 184 So. 296 (1938). More correctly stated, our concern is not nearly so much what the parties may have intended as it is what they said, for the words employed are by far the best resource for ascertaining intent and assigning meaning with fairness and accuracy.

Id. at 754.

Cherry v. Anthony, Gibbs, Sage, 501 So.2d 416 (Miss.1987) is to like effect:

The most basic principle of contract law is that contracts must be interpreted by objective, not subjective standards. A court must effect a determination of the meaning of the language used, not the ascertainment of some possible but unexpressed intent of the parties.

Id. at 419. Put otherwise, the search for intent of contracting parties is properly directed when it focuses upon the language of the contracting parties set in the context of the objective accessible world of conduct and...