Voorhees v. Guyan Machinery Co.

• Decision Date: 24 March 1994
• Docket Number: No. 21693,21693
• Court: West Virginia Supreme Court
• Parties: , 9 IER Cases 1465 Albert Coerte VOORHEES, Plaintiff-Appellee, v. GUYAN MACHINERY COMPANY, a West Virginia corporation and Robert Shell, Jr., Defendants-Appellants.

Page 672

446 S.E.2d 672

191 W.Va. 450, 9 IER Cases 1465

Albert Coerte VOORHEES, Plaintiff-Appellee, v. GUYAN MACHINERY COMPANY, a West Virginia corporation and Robert Shell, Jr., Defendants-Appellants.

No. 21693.

Supreme Court of Appeals of

West Virginia.

Submitted Jan. 19, 1994.

Decided March 24, 1994.

Syllabus by the Court

1. " 'A contractual covenant between employer and employee, restricting the employee from engaging in business similar to that of the employer within a designated time and territory after the employment should cease, will be enforced if the restriction is reasonably necessary for the protection of the employer and does not impose undue hardship on the employee.' Syllabus, O. Hommel Co. v. Fink, 115 W.Va. 686, 177 S.E. 619 (1934)." Syl. pt. 1, Appalachian Laboratories Inc. v. Bostic, 178 W.Va. 386, 359 S.E.2d 614 (1987).

2. " 'When the skills and information acquired by a former employee are of a general managerial nature, such as supervisory, merchandising, purchasing and advertising skills and information, a restrictive covenant in an employment contract will not be enforced because such skills and information are not protectible employer interests.' Syllabus, Helms Boys, Inc. v. Brady, 171 W.Va. 66, 297 S.E.2d 840 (1982)." Syl. pt. 2, Moore Business Forms, Inc. v. Foppiano, 181 W.Va. 305, 382 S.E.2d 499 (1989).

3. When a servant is enticed to desert service by another, "[m]alice is inferred from the wrongful character of the act, and the declaration or complaint must disclose such facts as support the inference." Thacker Coal & Coke Co. v. Burke, 59 W.Va. 253, 53 S.E. 161 (1906).

4. If anything has occurred to render further association between the parties offensive or degrading to the employee, an offer of further employment by the employer will not diminish the employee's recovery if the offer is not accepted.

Charles E. Hurt, Hurt & Barone, Charleston, for plaintiff-appellee.

Fred F. Holroyd, Holroyd & Yost, Charleston, for defendant-appellant Guyan Machinery Company.

P. Rodney Jackson, Ditrapano & Jackson, Charleston, for defendant-appellant Robert Shell, Jr.

NEELY, Justice:

Albert Coerte Voorhees was hired by Guyan Machinery Company ("Guyan Machinery") as an outside salesman on 1 July 1981. On 9 December 1985, Mr. Voorhees was required to sign a non-competition agreement wherein Mr. Voorhees agreed that if he should leave Guyan Machinery, he would not compete with Guyan Machinery for a period of 24 months from the date of termination of his employment within a 250-mile radius of the State of West Virginia.

On 11 July 1991, Mr. Voorhees resigned from Guyan Machinery and shortly after began working for Polydeck Screen Corporation ("Polydeck"), a competitor of Guyan Machinery. On 7 August 1991, Robert Shell, Jr., chairman of the board of directors of Guyan Machinery, alerted Polydeck to the existence of the non-competition agreement between Guyan Machinery and Mr. Voorhees and threatened that "he would go to the highest court of the land to enforce it." ¹ Deiter Egler, executive vice president of Polydeck, thereupon informed Mr. Voorhees that if he failed to renegotiate the restrictions on the non-competition agreement with Guyan Machinery, Polydeck would be forced to fire him. Notwithstanding efforts, however, no agreement was reached between Mr. Voorhees and Guyan Machinery and on 14 August 1991, Polydeck fired Mr. Voorhees.

On 2 October 1991, Mr. Voorhees filed an action in the Circuit Court of Logan County, alleging that Guyan's actions in threatening a lawsuit and in refusing to permit Mr. Voorhees to work for Polydeck in the areas covered by the noncompetition agreement tortiously interfered with his contract of employment with Polydeck. By letter dated 30 October 1991, Guyan Machinery extended an offer to Mr. Voorhees to report to work as a salesman at Guyan Machinery's Chapmanville, West Virginia office on 4 November 1991. Mr. Voorhees refused the offer, dismissing it as a sham designed to induce Mr. Voorhees to drop the lawsuit.

On 12 June 1992, the circuit court denied Guyan Machinery's motion in limine based on Mr. Voorhees' failure to mitigate damages in failing to accept a comparable position offered to Mr. Voorhees by Guyan Machinery.

On the basis of interrogatories propounded to the jury on 24 July 1992, the court found that: (1) the noncompetition agreement was invalid and Guyan Machinery knew or should have known it was invalid; (2) Guyan Machinery had tortiously and intentionally interfered with Mr. Voorhees' contract of employment with Polydeck; and (3) because Mr. Shell acted in the reasonable belief that he was protecting a legitimate business interest in alerting Polydeck to the existence of the noncompetition agreement, he should be dismissed from the suit. On the same day, the jury returned a verdict against Guyan Machinery, awarding Mr. Voorhees compensatory damages in the amount of $75,000, punitive damages in the amount of $75,000 and prejudgment interest on the compensatory damages computed from 14 August 1991, the day on which Mr. Voorhees was fired by Polydeck, in the amount of $7,065.76.

After the circuit court denied Guyan Machinery's motion for a directed verdict in their favor based upon a valid and enforceable noncompetition agreement entered into by the parties as well as its motion to set aside the jury verdict as contrary to the law and evidence, Guyan Machinery appealed to this Court assigning the following errors: Mr. Voorhees failed to prove that Guyan Machinery intentionally interfered with an employment relationship without justification or excuse; neither compensatory nor punitive damages were justified; and Mr. Voorhees' failure to meet his duty to mitigate damages by accepting an offer of reemployment from Guyan Machinery was improperly disregarded by the circuit court.

I.

In Thacker Coal & Coke Co. v. Burke, 59 W.Va. 253, 254, 53 S.E. 161, 162 (1906), we held that "[i]f one wantonly and maliciously, whether for his own benefit or not, induces a person to violate his contract with a third person to the injury of that third person, it is actionable."

In Syllabus Point 2 of Torbett v. Wheeling Dollar Sav. & Trust Co., 173 W.Va. 210, 314 S.E.2d 166 (1983), we discussed the requirements of a prima facie case of tortious interference in an employment relationship and the factors that might show the interference was proper:

To establish prima facie proof of tortious interference, a plaintiff must show:

(1) existence of a contractual or business relationship or expectancy;

(2) an intentional act of interference by a party outside that relationship or expectancy;

(3) proof that the interference caused the harm sustained; and

(4) damages.

If a plaintiff makes a prima facie case, a defendant may prove justification or privilege, affirmative defenses. Defendants are not liable for interference that is negligent rather than intentional, or if they show defenses or legitimate competition between plaintiff and themselves, their financial interest in the induced party's business, their responsibility for another's welfare, their intention to influence another's business policies in which they have an interest, their giving of honest, truthful requested advice, or other factors that show the interference was proper.

On appeal, Guyan Machinery maintains that although Mr. Voorhees established prima facie proof of tortious interference, Mr. Voorhees failed to rebut Guyan Machinery's affirmative defenses offered for its interference. According to Guyan Machinery, the justifications it offered at trial in response to Mr. Voorhees' claim of tortious interference of business relationship--that Mr. Voorhees had signed a valid noncompetition agreement during his employment with Guyan Machinery; that Mr. Voorhees and Guyan Machinery were engaged in competing businesses; and, that Guyan Machinery's attempt to enforce the noncompetition agreement was for the sole purpose of protecting its legitimate business interest--rendered its interference proper.

These contentions notwithstanding, the jury determined that the noncompetition agreement was invalid and that Guyan Machinery's actions were an intentional act of interference. In Syllabus Point 2, Perry v Melton, 171 W.Va. 397, 299 S.E.2d 8 (1982), we noted the standard for reviewing a jury verdict:

In determining whether the verdict of a jury is supported by the evidence, every reasonable and legitimate inference, fairly arising from the evidence in favor of the party for whom the verdict was returned, must be considered, and those facts, which the jury might properly find under the evidence, must be assumed as true. Syllabus Point 3, Walker v. Monongahela Power Company, 147 W.Va. 825, 131 S.E.2d 736 (1963). Syllabus Point 4, Long v. City of Weirton, 158 W.Va. 741, 214 S.E.2d 832 (1975).

We find that the justifications offered by Guyan Machinery in response to Mr. Voorhees' claim of tortious interference with his business relationship with Polydeck were insufficient to reverse the jury's finding that Guyan Machinery's actions did in fact constitute tortious interference. The evidence at trial showed that any "competition" between Guyan Machinery and Polydeck was so insignificant as to render Guyan Machinery's claim that it was protecting its business interests by enforcing the noncompetition agreement with Mr. Voorhees absurd. According to John E. Sterling, a Guyan Machinery product sales manager, the only product manufactured by Polydeck is urethane screens, while the urethane screens represent less than one half of one percent of Guyan Machinery's total sales. Because there was no legitimate competition between Guyan Machinery and Polydeck, there was no legitimate business interest to be protected by enforcing the noncompetition agreement. In short, there was no error in the finding that Guyan Machinery improperly interfered with Mr. Voorhees' business relationship with Polydeck.

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