A&D Envtl. Servs., Inc. v. Miller , 243 N.C. App. 1 ( 2015 )

IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA14-1397
Filed: 15 September 2015
Guilford County, No. 14CVS6328
A&D ENVIRONMENTAL SERVICES, INC., Plaintiff,
v.
JOEL E. MILLER, Defendant.
Appeal by Defendant from order entered 8 October 2014 by Judge A. Robinson
Hassell in Guilford County Superior Court. Heard in the Court of Appeals 20 May
2015.
Graebe Hanna & Sullivan, PLLC, by Mark R. Sigmon and M. Todd Sullivan,
for Defendant-Appellant.
Brooks, Pierce, McLendon, Humphrey & Leonard, L.L.P., by James C. Adams,
II, and Andrew L. Rodenbough, for Plaintiff-Appellee.
DILLON, Judge.
This is the second appeal taken by Joel E. Miller (“Defendant”) in this
proceeding. The first appeal was from an order by the trial court denying Defendant’s
Rule 12(b)(3) motion to dismiss based on improper venue, for which we have filed an
opinion. A&D Environmental Services v. Miller, ___ N.C. App. ___, 770 S.E.2d 755
(filed 7 April 2015). This second appeal is from a preliminary injunction which was
entered by the trial court while the first appeal was still pending before our Court.
We affirm in part and dismiss in part.
A&D ENVIRONMENTAL SERVICES V. MILLER
Opinion of the Court
I. Background
A&D Environmental Services, Inc., (“Plaintiff”) is a company which provides
environmental services. Defendant went to work for Plaintiff in 2011, signing a non-
compete, non-solicitation, confidentiality agreement (the “Agreement”). The
Agreement provided, in part, that for a period of 24 months following Defendant’s
last day of employment, Defendant would not, inter alia, solicit business from or
provide services for a defined group of customers or prospects.
In early 2014, Defendant resigned from Plaintiff to work for a competitor.
Plaintiff came to believe that Defendant was performing duties for the competitor
which were in violation of the Agreement.
On 4 June 2014, Plaintiff commenced this action in Guilford County seeking
an order to enjoin Defendant from violating the Agreement. In its verified Complaint,
Plaintiff stated that its principal place of business was in Guilford County.
A. First Appeal – Defendant’s Rule 12(b)(3) Venue Motion
Defendant moved the trial court to dismiss the action pursuant to Rule 12(b)(3)
of the North Carolina Rules of Civil Procedure, arguing that venue in Guilford County
was improper based on a provision in the Agreement requiring that all disputes
thereunder be maintained in Mecklenburg County.
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A&D ENVIRONMENTAL SERVICES V. MILLER
Opinion of the Court
On 6 June 2014, the trial court entered an order denying Defendant’s Rule
12(b)(3) motion to dismiss. On 10 June 2014, Defendant entered his notice of appeal
– the first appeal in this proceeding – from this order.
On 7 April 2015, this Court filed its opinion in the first appeal, affirming the
trial court’s order denying Defendant’s Rule 12(b)(3) motion to dismiss.
B. Second Appeal – Plaintiff’s Motion for a Preliminary Injunction
However, while the first appeal was pending in this Court, Plaintiff filed a
motion in the trial court for a preliminary injunction after discovering that Defendant
was performing certain duties for the competitor which it believed were in violation
of the Agreement. The trial court conducted a hearing on the motion.
At the hearing, Defendant argued that Guilford County was not the proper
venue, but for an entirely different reason than the reason he gave at the hearing on
his Rule 12(b)(3) motion. Specifically, he represented to the trial court that he had
recently discovered evidence suggesting that Plaintiff’s principal place of business
was not in Guilford County, and that Plaintiff’s representation in its Complaint to
the contrary was false. Defendant argued that the trial court should consider this
new-found evidence as a basis to deny Plaintiff’s motion. Alternatively, Defendant
argued that the trial court should determine that it lacked jurisdiction to act on
Plaintiff’s motion for a preliminary injunction while the first appeal was pending
before our Court.
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A&D ENVIRONMENTAL SERVICES V. MILLER
Opinion of the Court
On 8 October 2014, while the first appeal was still pending before our Court,
the trial court granted Plaintiff’s motion, entering a preliminary injunction which
enjoined Defendant from marketing, selling or providing any services or products to
a defined group of customers. In part of the order, the trial court essentially
concluded that since the issue of venue was pending before our Court, it would not be
appropriate for the trial court to consider Defendant’s new venue theory which
concerned the actual location of Plaintiff’s principal place of business. Defendant
timely noticed his appeal from the preliminary injunction order, which is the subject
of this second appeal.
II. Jurisdiction
On appeal, Defendant makes a venue argument and a jurisdiction argument
to attack the preliminary injunction. First, Defendant argues that the trial court
erred in refusing to address the merits of his new improper venue theory, a theory
which was being considered by our Court in the first appeal. Second, Defendant
argues that the trial court lacked jurisdiction to issue the injunction while the first
appeal was still pending in this Court.
This appeal, however, is interlocutory. Though the general rule is that “there
is no right of immediate appeal from interlocutory orders and judgments[,]” Travco
Hotels v. Piedmont Natural Gas Co., 332 N.C. 288, 291, 420 S.E.2d 426, 428 (1992),
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A&D ENVIRONMENTAL SERVICES V. MILLER
Opinion of the Court
one exception to this rule is where the interlocutory order “affects a substantial right.”
N.C. Gen. Stat. § 7A-27(b)(3)(a).
Defendant claims that we have jurisdiction over this interlocutory appeal
because the preliminary injunction affects two substantial rights. First, Defendant
states that the preliminary injunction affects his right to have the case heard in the
proper venue. Defendant argues that this right is a substantial right. We agree.
Indeed, we have held that the “grant or denial of a motion asserting a statutory right
to venue affects a substantial right and is immediately appealable.” Snow v. Yates,
99 N.C. App. 317, 319, 392 S.E.2d 767, 768 (1990).
Second, Defendant states that the preliminary injunction affects his right to
earn a living. Defendant argues that this right is a substantial right. We disagree.
Not every order which affects a person’s right to earn a living is deemed to affect a
substantial right. Rather, whether such an order affects a substantial right depends
on the extent that a person’s right to earn a living is affected. For instance, we have
held that a preliminary injunction which effectively prevents a person from “a realistic
opportunity to use his own skill and talents” rises to the level of a substantial right.
Masterclean v. Guy, 82 N.C. App. 45, 52, 345 S.E.2d 692, 697 (1986). See also
Precision Walls, Inc. v. Servie, 152 N.C. App. 630, 635, 568 S.E.2d 267, 271 (2002)
(substantial right is affected where it “effectively prohibits defendant from earning a
living and practicing his livelihood in [two states]”); Milner Airco v. Morris, 111 N.C.
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A&D ENVIRONMENTAL SERVICES V. MILLER
Opinion of the Court
App. 866, 869, 433 S.E.2d 811, 813 (1993) (recognizing that an injunction which
creates the “inability to do business” may affect a substantial right). However, we
have also held that an injunction which merely limits a person’s ability to earn a
living may not affect a substantial right. See Consol. Textiles, Inc. v. Sprague, 117
N.C. App. 132, 134, 450 S.E.2d 348, 349 (1994) (holding that a substantial right was
not affected where “defendant was not prevented from earning a living or practicing
his livelihood” when he was merely enjoined from contacting the customers whom he
had solicited while working with his former employer). See also Bessemer City
Express v. City of Kings Mountain, 155 N.C. App. 637, 573 S.E.2d 712 (2002).
In the present case, the preliminary injunction at issue does not prevent
Defendant from working in Plaintiff’s industry, but rather it merely limits his
activities by not allowing him to call on or service a narrowly defined group of
customers, similar to the narrowly defined group in Sprague.1 Therefore, we hold
that Defendant’s statement – that the preliminary injunction affects his ability to
earn a living – fails to articulate a basis for appellate review.2
1 The preliminary injunction here states, in relevant part, that “Defendant is enjoined from
marketing, selling, or providing any services or products competitive with services and products
offered by [Plaintiff] to any customer of [Plaintiff] which [Defendant] contacted and serviced on behalf
of [Plaintiff], or about which [Defendant] obtained confidential information through his work with
[Plaintiff], during the last twelve months that [Defendant] worked for [Plaintiff].”
2 We do not suggest that an injunction which merely prevents a person from working with a
defined group of customers could never affect a person’s substantial rights. For example, it could be
argued in a future case that a defendant’s substantial right is affected where a “defined group of
customers” in the injunction is so large that the injunction leaves very few, if any, viable prospects or
customers for a defendant to call on. In the present case, however, Defendant makes no claim or
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A&D ENVIRONMENTAL SERVICES V. MILLER
Opinion of the Court
In conclusion, we hold that we have jurisdiction to consider the merits of any
argument by Defendant which touch on his right to have the case heard in the proper
venue. Specifically, Defendant’s argument that the trial court erred at the
preliminary injunction hearing in not considering his new improper venue theory
affects this substantial right; and, therefore, we consider the merits of this argument.
However, Defendant’s argument that the trial court lacked jurisdiction to entertain
Plaintiff’s preliminary injunction motion while the first appeal was pending does not
affect this substantial right; and, therefore, we lack jurisdiction to reach the merits
of this argument. Therefore, Defendant’s jurisdiction argument is dismissed. We
now turn to address the merits of Defendant’s improper venue argument.
III. Analysis
Defendant argues on this appeal that the trial court erred in refusing to
consider his contention that Guilford County was not a proper venue for Plaintiff’s
preliminary injunction motion to be heard.
We hold that the trial court acted correctly in accordance with N.C. Gen. Stat.
§ 1-294, which states that an appeal “stays all further proceedings in the court below
upon the judgment appealed from, or upon the matter embraced therein[.]” N.C. Gen.
Stat. § 1-294 (emphasis added). Specifically, the issue of whether venue in Guilford
County was proper was before this Court when the trial court entered the preliminary
showing that the group of customers defined in the preliminary injunction is so large that he has no
one to call on or work with.
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A&D ENVIRONMENTAL SERVICES V. MILLER
Opinion of the Court
injunction; and, therefore, Defendant’s argument at the preliminary injunction
hearing that Guilford County was not the proper venue for that hearing was a matter
embraced by the first appeal.
Defendant, nonetheless, contends that the trial court did have the authority to
consider his venue argument because he was basing his argument on a different
theory than the theory that he had advanced at the Rule 12(b)(3) motion hearing and
in the first appeal. However, the fact that Defendant was advancing a new theory
does not change our conclusion that his argument – that venue in Guilford County
was improper – was “a matter embraced” in the first appeal. Therefore, we hold that
the trial court did not err in its conclusion that Defendant’s “objections regarding
venue are not properly before [the trial court] at this time[.]”
IV. Conclusion
We affirm the trial court’s refusal to consider Defendant’s venue argument as
a basis to deny Plaintiff’s motion for a preliminary injunction. However, because
Defendant has failed to show how his argument that the trial court lacked jurisdiction
to enter the preliminary injunction during the pendency of the first appeal affects a
substantial right, we dismiss this argument.
AFFIRMED IN PART, DISMISSED IN PART.
Judges BRYANT and ELMORE concur.
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