Orkin Exterminating Co. v. Veal

• Decision Date: 16 March 1962
• Docket Number: No. 16308,16308
• Citation: 355 S.W.2d 831
• Parties: ORKIN EXTERMINATING COMPANY, Inc., Appellant, v. John R. VEAL, Appellee.
• Court: Texas Court of Appeals

Page 831

355 S.W.2d 831

ORKIN EXTERMINATING COMPANY, Inc., Appellant, v. John R. VEAL, Appellee.

No. 16308.

Court of Civil Appeals of Texas, Fort Worth.

March 16, 1962.

Rehearing Denied April 13, 1962.

Carrington, Johnson & Stephens, James E. Coleman, Jr., and Gene L McCoy, Dallas, for appellant.

Rumph Ivy & Karpenko and Evans J. Karpenko, Fort Worth, for appellee.

MASSEY, Chief Justice.

Plaintiff Orkin Exterminating Company, Inc. was formerly the employer of defendant John R. Veal. Plaintiff discharged the defendant and he started in business with another doing the same kind of work he had been performing as plaintiff's employee. By written covenant made a condition of employment defendant had agreed not to compete with plaintiff for a period of two years following termination of his employment, at certain stated locations. Plaintiff made demand upon defendant that he honor the obligation of his negative covenant and filed suit for injunction following defendant's refusal.

Trial before the court upon the plaintiff's right to permanent injunction resulted in a judgment denying any relief. The plaintiff appealed.

Judgment reversed. Cause remanded to the trial court for entry of judgment.

We believe to be enforceable by injunction any promise made by an employee, as a condition upon which his employer consents to employ him or maintain him in employment status, that he will not for himself or for others engage in a similar or competing business for a reasonable time after the termination of the employment and within a reasonable area. At least this is true where the public interest is not directly involved, nor where the promise exacted does not effect or form part of a plan to effect a monopoly. Restatement of the Law, Contracts, sec. 516 'Instances of Reasonable Restraints', followed by Weatherford Oil Tool Company v. Campbell, 1960, 161 Tex. 310, 340 S.W.2d 950.

Evidence in the instant case indisputably establishes that the defendant consented to the negative covenant, in his agreement not to compete with plaintiff, upon the premise that there existed necessity as of such time for protection of the business or good will of such employer. Defendant had never engaged in business like unto that of the plaintiff, prior to the time plaintiff first employed him. It seems to us that since it was not even sought to be shown in the evidence that circumstances and conditions had so changed since the covenant was made that enforcement thereof had become unnecessary to the protection of the business or good will of such employer, the continuance of such necessity should be legally presumed. In any event it is conclusively established in the record that in some places, and particularly as applied to certain former customers and prospects of the plaintiff, the defendant's competition with plaintiff is proving destructive to the good will built up by the latter. Nothing of record demonstrates that plaintiff's hands are other than clean, and its plea...