White Dairy Co. v. Davidson

• Decision Date: 26 September 1968
• Docket Number: 6 Div. 482
• Citation: 214 So.2d 416,283 Ala. 63
• Parties: WHITE DAIRY COMPANY, Inc. v. Clarence W. DAVIDSON.
• Court: Alabama Supreme Court

Page 416

214 So.2d 416

283 Ala. 63

WHITE DAIRY COMPANY, Inc. v.Clarence W. DAVIDSON.

6 Div. 482.

Supreme Court of Alabama.

Sept. 26, 1968.

Henry B. Welch and John S. Tucker, Jr., Birmingham, for appellant.

Weir & Shannon, Birmingham, for appellee.

HARWOOD, Justice.

Pursuant to a bill filed by the White Dairy Company, Hon. W. C. Barber, a judge of the Circuit Court of Jefferson County, granted a temporary injunction restraining C. W. Davidson from carrying on or engaging in a similar business as that of White Dairy Company, and also from soliciting old customers of White Dairy either for himself, or as officer, agent, or employee of a person, firm, or corporation, pending the rendition of a final decree.

The temporary injunction was made contingent upon White Dairy filing with the Register a satisfactory bond, which was duly filed.

Thereafter, Davidson timely filed a motion to dissolve the temporary injunction, and an answer to the bill.

The matter came on for hearing and thereafter the Chancellor issued a decree dissolving that part of the injunction restraining Davidson from 'carrying on and engaging in a similar business to that of complainant(White Dairy Company) within Jefferson County, Alabama,' but continued in effect that provision of the injunction restraining Davidson 'from soliciting old customers of complainant, (White Dairy Company) either for himself, or as officer, agent, or employee of any person, partnership, firm, or corporation.'(Par. ours)

This appeal is from the latter decree modifying the terms of the injunction as originally issued.

The evidence introduced in the hearing below tended to show that Davidson was first employed by White Dairy in 1942, as a route salesman.In 1947, he executed a written contract of employment.In this contract, Davidson's salary was fixed at 12% Of the proceeds of sales made by him.This was the same compensation he had been receiving.The contract also contained a clause to the effect that upon termination of Davidson's employment for any cause, he would refrain in Jefferson County, Alabama, from carrying on or engaging in a similar business, and from soliciting old customers of White Dairy, either for himself or for others, for a period of fifteen months.

In 1949, Davidson was promoted to Supervisor.This job basically concerned sales, service, collections, and route management for a division which included a number of routes.

In about five years, Davidson was promoted to District Manager in charge of four divisions covering approximately sixty routes.In 1958, he was promoted Sales Manager, in charge of district managers.His salary was approximately $12,000 per year.His duties were largely administrative.

In August 1966, Davidson signed a new employment contract containing a non-competition clause similar to the one contained in the earlier contract except that in this latter contract the period of non-competition was for five years.

In January 1967, Davidson resigned his position with White Dairy to accept a position with a dairy company in Atlanta, Georgia.

Davidson's mentally retarded daughter suffered emotional disturbances in the new surroundings in Atlanta, and had to be hospitalized.In about three months he returned to Birmingham and secured employment with Baker and Sons Dairy at a salary of $700.00 per month.

Davidson testified that the dairy business was the only business he knew, and the only type of business in which he could make a living of the kind to which he was accustomed.

He further testified that he was familiar with dairy business operations and that basically they are all operated in the same manner.

Davidson further testified that as personnel manager at Baker and Sons, he was in charge of recruiting and screening personnel, and directing company policy.He has nothing to do with sales, or contacting and developing new customers, and has never done so since his employment at Baker and Sons, nor has he never solicited or attempted to employ any employee of White Dairy.

Edgar H. Baker, Vice President of Baker and Sons Dairy testified that as personnel manager of Baker and Sons Dairy, the duties of Davidson were hiring and training personnel.Davidson had nothing to do with sales.To this witness' knowledge, Davidson had never solicited any customers for Baker and Sons nor discussed with him or any other officer of his company, any information he gained when working for White Dairy, nor furnished to Baker and Sons any customer lists or other information concerning White Dairy.

For White Dairy, Mr. Raymond L. Bell, Manager of the White Dairy Division of Barber Milk Company, testified as to the knowledge Davidson had access to as to the inner workings of the White Dairy Company business, that is, sales volumes, the territories served, whether good or bad, the abilities of various employees, sales promotion plans, sales personnel turnover, etc.

On cross examination, Mr. Bell testified that of his own knowledge he knew of no customer of White Dairy that had been solicited by Davidson since his employment by Baker and Sons, nor of any account of White Dairy being taken over by Baker and Sons, nor did he know of any injury or damage done to White Dairy by Davidson.

Davidson being recalled for further cross examination, testified he had not applied for work at any dairy company outside of Jefferson County.

The above was all the evidence submitted in the hearing below.

Applicable to the question now presented are Sections 22and23,Title 9,Code of Alabama 1940.These sections read:

22.'Every contract by which any one is restrained from exercising a lawful profession, trade, or business of any kind, otherwise than is provided by the next two sections, is to that extent, void.

23.'One who sells the good will of a business may agree with the buyer, and one who is employed as an agent, servant, or employee may agree with his employer, to refrain from carrying on or engaging in...