National Teen-Ager Co. v. Scarborough
| Decision Date | 19 June 1985 |
| Docket Number | TEEN-AGER,No. 41638,41638 |
| Citation | 254 Ga. 467,330 S.E.2d 711 |
| Parties | , 1985-2 Trade Cases P 66,735 NATIONALCO. v. SCARBOROUGH. |
| Court | Georgia Supreme Court |
J. Melvin England, England and Weller, Atlanta, for National Teen-Ager co William A. Dinges, Decatur, for Mary Jo Scarborough et al.
This appeal concerns the validity of certain restrictive covenants in a franchise contract between appellant-defendant National Teen-Ager Company (hereinafter referred to as "National") and appellees-plaintiffs Mary Jo and George Scarborough.
National is a Georgia corporation headquartered in Atlanta which conducts annual state and national pageant contests culminating in an award of the title "Miss National Teen-Ager" and various prizes to contestants. In August 1982 the Scarboroughs signed an agreement with National which designated them as "State Directors" for the purpose of conducting state pageants in Michigan, New Jersey, New York, and Pennsylvania to select contestants from those states to compete in the August 1983 "Miss National Teen-Ager Pageant." The contract provided that it would terminate in August 1983. In addition, it included the following non-competition covenant, denominated as "Paragraph X":
"[T]he State Director agrees not to compete either directly or indirectly or in any manner whatsoever with National Teen-Ager Company nor to engage in any like or similar business for profit or non-profit for a period of FIVE (5) years from the date of the execution of this agreement in the geographical territories described in this agreement."
National did not renew the contract for the 1984 pageant season, and the Scarboroughs filed a complaint for a declaration that the covenant was as an illegal restraint of trade. National answered the complaint and counterclaimed for a declaration that Para. X was reasonable and enforceable and for an injunction prohibiting the Scarboroughs from competing with National directly or indirectly in any manner whatsoever in the four states until August 1, 1987, and from engaging in any like or similar business for profit or non-profit within the same states and during the same period.
All parties moved for judgment on the pleadings and filed briefs in support of their motions. The superior court heard oral argument on the motions, and entered an order denying judgment on the pleadings to National and granting judgment on the pleadings to the Scarboroughs. In his order the judge found that Para. X was too broad, vague, and indefinite to be enforced. National appeals.
National contends the restriction is reasonable considering National's business interests and the effect on the Scarboroughs. 1 Regarding the effect on the Scarboroughs, National argues that the contract does not totally preclude them from earning their livelihood in the beauty pageant or talent contest business, since Para. X only excludes them from directing teen-aged female pageants in four enumerated states. Moreover, National asserts, the term "like or similar business" does not include pageants involving non-teen-aged females. Nor, argues National, are the Scarboroughs prohibited from employment in teen-aged female pageants or contests if their participation is limited to roles such as judge, stage hand, usher, or parking lot attendant.
In response to appellant's contention, the Scarboroughs assert that the non-competition clause is unreasonable because the activities from which they are prohibited are not specified with particularity. They argue that Para. X is too broad and indefinite because its clauses, "any like or similar business for profit or non-profit," and "either directly or indirectly or in any manner whatsoever with National Teen-Ager Company," attempt to prohibit them from engaging in any type of beauty pageant or talent contest in any capacity, whether as state directors, press agents, advertising salespersons, masters of ceremony, judges, or stagehands.
We affirm the denial of judgment on the pleadings to National and reverse the grant of judgment on the pleadings in favor of the Scarboroughs, but not for the reasons urged by the parties.
"Covenants against competition which are contained in employment contracts 2 are considered to be in partial restraint of trade and will be upheld only if they are strictly limited in time and territorial effect, and are otherwise reasonable...
To continue reading
Request your trial
-
Freiburger v. JUB Engineers, Inc.
...indefinite to be considered reasonable. Id. at 368-69, 448 S.E.2d 206, 17 P.3d at 312-13; See also National Teen-Ager Co. v. Scarborough, 254 Ga. 467, 330 S.E.2d 711, 713 (Georgia 1985); American Family Life Assurance Co. v. Tazelaar, 135 Ill.App.3d 1069, 90 Ill.Dec. 789, 482 N.E.2d 1072, 1......
-
Pinnacle Performance, Inc. v. Hessing
...employee is prohibited from performing is too overbroad and indefinite to be considered reasonable. See National Teen-Ager Co. v. Scarborough, 254 Ga. 467, 330 S.E.2d 711, 713 (1985); American Family Life Assurance Co. v. Tazelaar, 135 Ill.App.3d 1069, 90 Ill.Dec. 789, 482 N.E.2d 1072, 1075......
-
W.R. Grace & Co., Dearborn Div. v. Mouyal
...setting to which it is applied. Watson v. Waffle House, 253 Ga. 671, 673, 324 S.E.2d 175 (1985). See also National Teen-ager Co. v. Scarborough, 254 Ga. 467, 469, 330 S.E.2d 711 (1985). 2. The focus of this case is the absence of an express geographic description of the territorial restrict......
-
ALW Marketing Corp. v. McKinney
...particular factual setting to which it is applied." Id. at 673, 324 S.E.2d 175. For example, the Court in National Teen-Ager Co. v. Scarborough, 254 Ga. 467, 469, 330 S.E.2d 711 (1985), reaffirmed the rule that a non-competition covenant that prohibits the employee from working for a compet......
-
Labor and Employment Law - W. Melvin Haas Iii, William M. Clifton Iii, W. Jonathan Martin Ii, and Glen R. Fagan
...Ga. App. 289, 292, 498 S.E.2d 346, 350 (1998)). 125. Id. 126. Id. at 178, 675 S.E.2d at 55 (quoting Nat'l Teen-Ager Co. v. Scarborough, 254 Ga. 467, 469, 330 S.E.2d 711, 713 (1985)). 127. Id. 128. Id. at 177, 675 S.E.2d at 55. 129. Id. at 177-78, 674 S.E.2d at 55. 130. Id. at 175, 674 S.E.2......