National Farmers Union Service Corp. v. Edwards

• Court: Nebraska Supreme Court
• Writing for the Court: KRIVOSHA; HASTINGS
• Citation: National Farmers Union Service Corp. v. Edwards, 369 N.W.2d 76, 220 Neb. 231 (Neb. 1985)
• Decision Date: 14 June 1985
• Docket Number: No. 84-278,84-278
• Parties: NATIONAL FARMERS UNION SERVICE CORPORATION, Appellant, v. Bruce R. EDWARDS, Appellee.

Page 76

369 N.W.2d 76

220 Neb. 231

NATIONAL FARMERS UNION SERVICE CORPORATION, Appellant, v. Bruce R. EDWARDS, Appellee.

No. 84-278.

Supreme Court of Nebraska.

June 14, 1985.

Syllabus by the Court

1. Breach of Contract: Restrictive Covenants: Appeal and Error. The review of a case involving the enforcement of a noncompete clause by injunctive process is done de novo on the record, and it is necessary for this court to reach an independent conclusion without being influenced by the findings of the trial court, absent conflicting credible evidence.

2. Contracts. There can be no ambiguity in a contract unless and until an application of the pertinent rules of interpretation leaves it really uncertain which of two or more possible meanings represents the true intention of the parties.

3. Contracts. Where contract language is plain and unambiguous, the court will not read an ambiguity into it in order to construe it against the one who prepared the contract.

4. Contracts: Restrictive Covenants. Covenants not to compete, if reasonable, are enforceable. The considerations to be balanced are the degree of inequality in bargaining power; the risk of the covenantee losing customers; the extent of respective participation by the parties in securing and retaining customers; the good faith of the covenantee; the existence of sources or general knowledge pertaining to the identity of customers; the nature and extent of the business position held by the covenantor; the covenantor's training, health, education, and needs of his family; the current conditions of employment; the necessity of the covenantor changing his calling or residence; and the correspondence of the restraint with the need for protecting the legitimate interests of the covenantee.

5. Contracts: Restrictive Covenants. Where a noncompete clause is overly broad, it may be found unreasonable to enforce.

6. Breach of Contract: Restrictive Covenants: Damages: Proof. In order to recover substantial damages flowing from a breach of a covenant not to compete, a plaintiff must furnish sufficient data to enable the trier of fact to estimate the actual damages with a reasonable degree of certainty and exactness, although, failing to do so, if there is evidence of a specific monetary loss, recovery of a nominal sum may be had.

Wagoner & Wagoner, Grand Island, for appellant.

Cunningham, Blackburn, VonSeggern, Livingston, Francis & Riley, Grand Island, for appellee.

KRIVOSHA, C.J., and BOSLAUGH, WHITE, HASTINGS, CAPORALE, SHANAHAN, and GRANT, JJ.

HASTINGS, Justice.

Plaintiff has appealed the final order of the district court which denied its petition for an injunction and for damages allegedly arising out of the violation by the defendant of a noncompete agreement. We affirm the judgment as modified.

The defendant, Bruce R. Edwards, entered into an employment contract in December of 1980 with the plaintiff, National Farmers Union Service Corporation, to sell insurance. By the terms of that contract Edwards was required to act as an exclusive agent of National Farmers in that he agreed not to "place any insurance of the types offered by INSURERS with any insurance company other than INSURERS without the written consent of the COMPANY." Plaintiff agreed to pay Edwards a salary, along with his commission, on a decreasing basis over a 3-year period.

As a part of the contract, Edwards also agreed as follows:

13. AGENT agrees he will not engage in the sale or solicitation of any insurance of the types offered by INSURERS within twenty-five (25) miles of AGENT'S principal place of business for a period of one year from and after the date of voluntary or involuntary termination of this AGREEMENT....

The contract called for Edwards to perform his services in and around St. Paul, Nebraska.

Edwards voluntarily terminated his relationship with the plaintiff effective April of 1982. At that time defendant had received salary and commissions of $16,976.17 in 1981 and $7,592.06 in 1982. There is no question but that Edwards has been soliciting and selling insurance in competition with the plaintiff and in violation of the plain wording of the contract.

It apparently was the trial court's theory in denying relief that the noncompete provisions of the contract were ambiguous, that they were unreasonable and unenforceable if interpreted as urged by plaintiff, and that the parties' bargaining powers were unequal.

The plaintiff for its assignments of error simply states that the court erred in finding that the restraints imposed by the noncompete clause were ambiguous and in misapplying Dana F. Cole & Co. v. Byerly, 211 Neb. 903, 320 N.W.2d 916 (1982).

It is necessary that we review this type of case, where an injunction is sought, de novo on the record and reach an independent conclusion without being influenced by the findings of the trial court, absent conflicting credible evidence. Dana F. Cole & Co. v. Byerly, supra; Sturm v. Mau, 209 Neb. 865, 312 N.W.2d 272 (1981). There are no evidentiary disputes in the record.

We dispose first of the claimed ambiguity of the language of the contract. In Meyers v. Frohm Holdings, Inc., 211 Neb. 329, 333, 318 N.W.2d 716, 719 (1982), this court stated "there can be no ambiguity ... unless and until an application of the pertinent rules of interpretation leaves it really uncertain which of two or more possible meanings represents the true intention of the parties."

The language could...