Darr v. Roberts Mktg. Grp., LLC

• Decision Date: 22 April 2014
• Docket Number: No. ED 100197.,ED 100197.
• Citation: 428 S.W.3d 717
• Court: Missouri Court of Appeals
• Parties: David DARR, Appellant, v. ROBERTS MARKETING GROUP, LLC and Division of Employment Security, Respondents.

428 S.W.3d 717

David DARR, Appellant,

v.ROBERTS MARKETING GROUP, LLC and Division of Employment Security, Respondents.

No. ED 100197.

Missouri Court of Appeals,

Eastern District,

Division Five.

April 22, 2014.

Michael J. Zpevak, Austin, TX, for Appellant.

Bart A. Matanic, Attorney for Div. of Employment Security, Jefferson City, MO, Michael E. Kaemmerer, Lindsey D. Rendlen, Attorney for Roberts Marketing Group, Chesterfield, MO, for Respondent.

KARL A.W. DeMARCE, S.J.

David L. Darr appeals the decision of the Labor and Industrial Relations Commission (“the Commission”) denying him unemployment benefits. The question presented is whether, in refusing to sign a proffered non-compete agreement which was required as a condition of continued employment, Mr. Darr left work voluntarily, but with good cause attributable to his employer, Roberts Marketing Group, LLC (“Employer”). We reverse and remand.

STANDARD OF REVIEW

The scope of our review of the Commission's decision is delineated both by our state constitution and by statute. We are required by Mo. Const. art. V, § 18 to determine whether the Commission's decision is “authorized by law” and “whether it is supported by competent and substantial evidence upon the whole record.” Pulitzer Publishing Co. v. Labor & Indus. Relations Comm'n, 596 S.W.2d 413, 417 (Mo. banc 1980); Hubbell Mechanical Supply Co. v. Lindley, 351 S.W.3d 799, 807 (Mo.App. S.D.2011).

Our review is also conducted pursuant to the narrow standard set forth in section 288.210.¹ Under this standard, we do not hear any new evidence but rather determine whether the Commission's findings of fact upon the record before us are supported by competent and substantial evidence. If so, the findings are deemed conclusive in the absence of fraud. Osman v. Div. of Empl. Sec., 332 S.W.3d 890, 892 (Mo.App. W.D.2011). We may modify, reverse, remand for rehearing, or set aside the award upon finding: (1) that the Commission acted without or in excess of its powers; (2) that the award was procured by fraud; (3) that the facts found by the Commission do not support the award; or (4) that there was not sufficient competent evidence in the record to warrant the making of the award. Section 288.210.

“Decisions of the Commission which are clearly the interpretation or application of the law, as distinguished from a determination of facts, are not binding upon us and fall within our province of review and correction. When it is clear that the Commission's decision resulted from its application of the law, instead of its application of reason to the facts, we give no deference to the Commission's conclusions and use our own independent judgment.” Osman, 332 S.W.3d at 892–93 (internal citations and quotation marks omitted).

“In examining the record, we must examine the whole record to determine if it contains sufficient competent and substantial evidence to support the award, i.e., whether the award is contrary to the overwhelming weight of the evidence. We defer to the Commission's determinations on issues resolving matters of witness credibility and conflicting evidence. The Commission's decision should not be overturned unless it is contrary to the overwhelming weight of the evidence. The reviewing court is not to view the evidence and all reasonable inferences drawn therefrom in the light most favorable to the award. Instead, we must objectively review the entire record, including evidence and inferences drawn therefrom that are contrary to, or inconsistent with, the Commission's award.” Hubbell Mechanical Supply, 351 S.W.3d at 807 (internal citations and quotation marks omitted); see also Timberson v. Div. of Empl. Sec., 333 S.W.3d 30, 32 (Mo.App. W.D.2010).

FACTUAL AND PROCEDURAL BACKGROUND

Mr. Darr began working for Employer selling final expense life insurance in October 2012.

Ms. Dina Hakim, Employer's director of human resources, testified that Employer announced on January 24, 2013, that it would be implementing a new non-compete agreement for its employees. As the terms of this agreement are relevant to our analysis of the issues presented, we set forth some of its contents in detail.

In its preamble, this proposed “Confidentiality and Non–Competition Agreement” recited, “WHEREAS, Company desires to continue the employment of Employee, but contingent upon signing this Agreement ” (emphasis added). In some of it provisions, the Agreement provided:

3. Covenant not to compete.

(a) Employee expressly covenants and agrees that during the term of employment with Company and for a period of thirty-six (36) months immediately following the expiration or cessation of employment with Company for any reason, EMPLOYEE SHALL NOT in any way, directly or indirectly, individually or on behalf of or in cooperation with any other person, group of persons, partnership, company, corporation, association or any other entity; Engage in any business competing directly or indirectly with any product, service or business venture related in any manner to or concerning the Company's Business in any Region in which the Company conducts same.

(b) Definitions.

i. For these purposes, the “Company's Business” is defined as the lead generation of and/or sale of any and all type life insurance policies through telesales.

ii. For these purposes, “Region” is defined as the continental United States, including Alaska and Hawaii, and all U.S. territories.

... 6. Damages. With respect to each and every breach or violation or threat of same by Employee of any of the covenants, terms and provisions of Paragraphs 1, 2, 3 or 4 and throughout this Agreement, Company, in addition to all other remedies, shall be entitled to enjoin the continuance thereof and may apply to any Court of competent jurisdiction for entry of an immediate restraining order or injunction.

In addition, Employee agrees to immediately, upon demand, account for and pay over to Company an amount equal to all compensation, commission, bonus, salary, gratuity or other remuneration or emolument of any kind directly or indirectly received by or for the use or benefit of Employee resulting from any activity, transaction or employment in breach or violation of Paragraph 3 of this Agreement, such amount being agreed to constitute liquidated damages, and not a penalty.

...

9. Waiver of Defenses. Employee waives any objection to any and all terms and conditions of this Agreement, including but limited to Paragraphs 1, 2, 3 and 4 hereof, and covenants to institute no suit or proceeding or otherwise to advance any position, defense or contention to the contrary.

10. Employee's Representations on Ability to Earn a Living. Employee acknowledges that the covenants, terms and provisions of this Agreement are reasonable and do not impose a financial hardship on Employee. Employee acknowledges the ability to engage in gainful activities for the purpose of earning a living other than those violative of this Agreement. The Employee represents and warrants to Company that Employee's expertise and capabilities are such that Employee can pursue a livelihood without breaching the terms and conditions of this Agreement and that the obligations under this Agreement (and the enforcement thereof by injunction or otherwise) will not prevent Employee from earning a livelihood.

...

12. Tolling Provision. In the event that the Employee is in breach of any of the provisions of Paragraph 3, the period of proscription from the act or acts that constitute a breach of Paragraph 3 shall be extended for a period of thirty-six (36) months from the date that the Employee ceased, whether voluntarily or by Court order, to engage in said actions.

Among the remaining sections of the non-compete agreement were provisions requiring the employee to pay all of Employer's costs, expenses, and reasonable attorney's fees incurred in enforcing the agreement in the event of a violation by the employee; a waiver of any right to jury trial; a severability clause; and a waiver of the application of the rule of strict construction against the drafter.

In Ms. Hakim's written statement filed with the Commission, she stated that all employees would be required to sign the non-compete agreement by February 1, 2013. A company-wide meeting was held on January 29, 2013, at which employees were allowed to ask questions regarding the agreement, and were provided a notary public on site to facilitate execution of the documents. There was no evidence to suggest that Employer permitted any actual negotiation of the agreement's terms by Mr. Darr or any other employee.

On January 30, 2013, Mr. Darr met with his direct manager and with the vice president of sales and marketing, Mr. Ramiz Hakim. Mr. Darr expressed that he was not inclined to sign the agreement and that he needed to speak to an attorney. Mr. Hakim acknowledged that Mr. Darr asked “some very good questions” about the agreement during their meeting. Mr. Darr was informed that signing the non-compete agreement was a condition of his employment and that the agreement needed to be signed and notarized by February 1. The following day, January 31, Mr. Darr met with Ms. Hakim and with Mr. Aaron Eidson, Employer's vice president of operations. Mr. Darr again stated that he was not willing to sign the agreement and needed to speak to an attorney. However, Ms. Hakim reports that at the conclusion of this 30–minute meeting, Mr. Darr stated that he would sign and notarize the agreement by February 1.

Mr. Hakim indicated that during these meetings he discussed certain alternatives with Mr. Darr, including transfer to another department. The transfer would have been to a position in the marketing department. Mr. Darr believed, based upon his previous experience in the company, that this position would involve a less lucrative compensation structure. Mr. Darr also believed, based on information shared with him by persons in the company, that employees in the marketing department...