Quick v. Bakke, Kopp, Ballou & McFarlin, Inc.

• Decision Date: 20 November 1985
• Docket Number: No. 14825,14825
• Citation: 380 N.W.2d 364
• Parties: Chester I. QUICK v. BAKKE, KOPP, BALLOU & McFARLIN, INC., Consulting Engineers . Considered on Briefs
• Court: South Dakota Supreme Court

Page 364

380 N.W.2d 364

Chester I. QUICK v. BAKKE, KOPP, BALLOU & McFARLIN, INC., Consulting Engineers

No. 14825.

Supreme Court of South Dakota.

Considered on Briefs Nov. 20, 1985.

Decided Jan. 22, 1986.

Frank P. Gibbs of Simons, Gibbs, Feyder & Myers, Sioux Falls, for plaintiff and appellant.

Michael Luce of Davenport, Evans, Hurwitz & Smith, Sioux Falls, for defendant and appellee.

WUEST, Justice.

This is an appeal from a judgment for defendant in an action for breach of contract. We reverse.

In June 1980, Chester I. Quick (appellant), a self-employed consulting engineer in Sioux Falls, South Dakota, entered into an employment agreement with Bakke, Kopp, Ballou & McFarlin, Inc. (Bakke), a Minneapolis based engineering firm. Under this agreement, appellant merged his practice with Bakke and received an annual salary of $30,000, as well as a share in the profits or losses of the Sioux Falls office. The agreement contains no restrictions prohibiting appellant from terminating his employment, upon proper notice, and competing with Bakke in the Sioux Falls area.

In October 1981, after the Sioux Falls office had operated at a deficit for over a year, the parties entered into negotiations whereby Bakke would buy out appellant's business, while retaining appellant as an employee under the terms of the June 1980 agreement. The parties arrived at a contract for the sale of the business on February 8, 1982. By this contract, Bakke agreed to pay appellant $30,000 for his business, $1,500 was attributed to tangible property and $28,500 was related to appellant's goodwill. The main portion of this contract was prepared by appellant's accountant. An addendum to the contract also exists. The addendum was prepared by Bakke in its office, and states:

It is agreed that if Chester I. Quick terminates his employment with Buyer, that he will not compete with Buyer as a Structural Engineer within the City of Sioux Falls until October 1, 1985.

If Chester I. Quick terminates his employment with Buyer and does compete with Buyer prior to October 1, 1985, then any payments due Chester I. Quick from the date competition is determined shall be null and void.

The financial situation of the Sioux Falls office did not improve and, in early April 1982, appellant was notified by Bakke that his employment was terminated as of May 31, 1982. Appellant ceased working for Bakke on April 16, 1982, but received wages through May 31, 1982. In June 1982, despite representations to Bakke that he was writing computer programs, appellant began working as a consulting engineer from his home in Sioux Falls. Bakke learned of appellant's competition and ceased payments under the purchase agreement on November 3, 1982. By this date, payments of $12,240 had been made under the contract.

Appellant brought an action in Minnehaha County Circuit Court to recover $17,760, plus interest and costs, for the balance due on the purchase contract. The matter was tried before the court on October 2, 1984, and on October 15, 1984, the trial court issued a decision finding for Bakke. Appellant contends the addendum to the purchase agreement was plain and unambiguous and the trial court should not have permitted parol evidence to vary it. Appellant argues that in plain and unambiguous language, which reads: "If Chester I. Quick terminates his employment," the addendum requires that he resign rather than be terminated by Bakke, in order...