Dalco Corp. v. Dixon, C1-82-1520.

• Decision Date: 23 September 1983
• Docket Number: No. C1-82-1520.,C1-82-1520.
• Citation: 338 NW 2d 437
• Parties: DALCO CORPORATION, Appellant, v. Maurice DIXON and Brissman-Kennedy, Inc., Respondents.
• Court: Minnesota Supreme Court

338 N.W.2d 437 (1983)

DALCO CORPORATION, Appellant, v. Maurice DIXON and Brissman-Kennedy, Inc., Respondents.

No. C1-82-1520.

Supreme Court of Minnesota.

September 23, 1983.

Jerome S. Rice Law Offices, Minneapolis, for appellant.

O'Neill, Burke & O'Neill, St. Paul, for respondents.

Considered and decided by the court en banc without oral argument.

KELLEY, Justice.

Appellant, Dalco Corporation (Dalco), instituted this action against a former employee, respondent Maurice Dixon, and against Dixon's subsequent employer, respondent Brissman-Kennedy, Inc. (B-K), alleging that Dixon breached a non-compete employment agreement; that both respondents are unfairly competing with Dalco; that B-K has tortiously interfered with Dalco's employment contract with Dixon and other contractual rights; and that as a result of all the foregoing, respondent B-K has illegally obtained an unfair competitive advantage over Dalco. Appellant sought both injunctive relief and damages. In three separate pretrial orders, the trial court (1) in the first order denied Dalco's motion for a temporary injunction, denied Dixon's motion for summary judgment and granted B-K's motion for summary judgment; (2) in the second order granted Dalco's motion for entry of judgment, thereby making the first order appealable; and (3) in the third order ordered Dalco to pay B-K $9,000 in attorney fees B-K incurred in defending the action. Dalco appeals from all three orders. We affirm in part and reverse in part.

Dalco and B-K are competitors in the sale of cleaning and janitorial supplies. Dixon commenced working for Dalco in 1959. After a 3-year lapse from 1964 to 1967, Dixon returned to employment at Dalco and was thereafter continuously employed until the fall of 1981. Up until July of 1981, Dixon was executive vice president and sales manager. The day following his resignation from Dalco, Dixon began working for Professional Building Supply Company, a Minneapolis cleaning products distributor, as vice president of sales. He left this position approximately 6 weeks later to enter employment with B-K.

Dixon denies that he ever signed or promised to sign a non-compete agreement during the course of his employment with Dalco. He was asked to sign one in July of 1981, 2 or 3 months before he resigned, but he refused to do so on advice of counsel. On the other hand, Dalco's president asserts Dixon did sign a non-compete agreement when he first commenced working for Dalco in approximately 1959; however, Dalco had been unable to locate it for production at the hearing. Dalco's president further claimed that sometime after Dixon returned to Dalco in 1967, Dixon had agreed to sign another modified non-compete agreement then, and now, being used by Dalco. All of Dalco's sales personnel had to execute such modified non-compete agreements, and part of Dixon's duties as vice president of sales for Dalco was to insure that the non-compete agreements were executed by the sales personnel. However, Dalco was unable to produce any non-compete agreement containing Dixon's signature.

Dalco seeks to enforce the alleged non-compete agreement against Dixon; claims that B-K interfered with its contract with Dixon and with contract rights it had with others; and contends that Dixon's knowledge of Dalco's pricing policies and the use of that knowledge on behalf of B-K constitutes unfair competition giving B-K — one of Dalco's chief competitors — an unfair competitive advantage. In support of its claim against B-K, Dalco submitted affidavits of some of its sales personnel which alleged with respect to sales accounts served by them that Dixon had knowledge of Dalco's pricing information and that B-K was engaging in price competition with Dalco in such a manner as to indicate that B-K must be using the confidential price and sales information obtained by Dixon from Dalco.

1. Following the hearing by the trial judge on Dalco's motion for a temporary injunction and the respondents' motion for summary judgment, Dalco attempted to submit a deposition of Thomas Fischer, a former B-K vice president, who raised some questions as to the propriety of B-K's hiring of Dixon away from Dalco and as to whether B-K or Dixon engaged in unfair competition through suppressing information. Dalco likewise sought to present three affidavits raising a question of fact regarding B-K's alleged piracy of Dalco employees and the alleged improper use of confidential pricing information. The trial court refused to consider the deposition and the affidavits. Dalco contends that the trial court should have permitted further discovery between the date of the hearing and the date of the ruling, and that had the court done so, the deposition and affidavits should have been considered by the court in ruling on B-K's summary judgment motion.

We have previously held that in order to successfully oppose a motion for summary judgment a party may not rely on general statements of fact but rather "must demonstrate at the time the motion is made that specific facts are in existence which create a genuine issue for trial." Erickson v. General United Life Insurance Co., 256 N.W.2d 255, 259 (Minn.1977). Moreover, Rule 3.02(c) of the Rules of Court for the Fourth Judicial District provides: "The Court will not consider any memoranda, documentation or letters submitted after the hearing unless an extended date is allowed by the court at the hearing." Because the trial judge had not explicitly granted Dalco an extension to complete discovery or file additional documents, the court was precluded by our decisions and by its own procedural rules from considering the submitted affidavits and deposition.

Dalco contends that since the trial court had not made its order granting summary...