J. C. Pirkle MacHinery Co. Inc. v. Walters

The petition set forth no cause of action; and the trial judge did not err in sustaining a general demurrer thereto.

No. 16527. APRIL 11, 1949. J. C. Pirkle Machinery Company sought to enjoin Robert v. Walters, a former employee, from violating the negative restrictive covenants of an employment contract and to recover damages for the breach of the restrictive covenants. The restrictive clause of the contract provided as follows: "(1) That he will not divulge to anyone any of the knowledge he has acquired while employed by said company, in any manner, with reference to said company's business, either while he is employed by said company, or after he has severed his connection with said company; (2) that he will not open up a business of his own, doing the same kind of business as said company is now engaged, in the following States, to wit: Georgia, North Carolina, South Carolina, Alabama, Mississippi, and Tennessee, within a period of ten years from the date he may sever his connection with the above said company; neither will he become employed by any company doing the same kind of business as that of the above said company, for a period of ten years, from the date he may sever his connection with the above said company, in any of the above said States."

The petition alleged: "Plaintiff shows that his (plaintiff's) office is at No. 101 1/2 South Main Street, at East Point, Georgia, Fulton County, from which office he does business in Georgia, North Carolina, South Carolina, Alabama, Tennessee, and Mississippi, and has, in the past, enjoyed a considerable business and large profit by having, as aforesaid, the listings, manufacturers, and vendors of such properties, and his private way, manner, methods and course of carrying on business." It was then alleged that the defendant had violated the restrictive clause of the contract by going into business in competition with the plaintiff.

The trial court sustained a general demurrer to the petition; and to this judgment the plaintiff excepted. The first question presented to this court is whether or not the restrictive covenant is a reasonable limitation as to territory.

Whether the restraints imposed by an employment contract are reasonable is a question of law for determination by the court.Rakestraw v. Lanier, 104 Ga. 188, 194 (30 S.E. 735). The restrictions imposed upon the promisor must not be larger than are necessary for the protection of the promisee. Rakestraw v.Lanier, supra. Greater latitude is allowed in those covenants relating to the sale of a business, or dissolution of a partnership, than in those covenants ancillary to an employment contract. 17 C. J. S., § 254, p. 636; Rakestraw v. Lanier, supra; Hood v. Legg, 160 Ga. 620 (128 S.E. 891).

With these well-settled rules of law in mind, did the petition in this case set forth a cause of action? It will be noted that the petition alleges that the office and place of business of the plaintiff is located in Fulton County, Georgia, "from which office he does business in Georgia, North Carolina, South Carolina, Alabama, Tennessee, and Mississippi." No attempt is made to describe the business of the plaintiff in these various States, or whether the plaintiff's business covers all or only a portion of any of the named States. We think that in this case, where an effort is made to prevent the defendant from following his occupation in six States, based upon the bare allegation that the plaintiff does business in those States, the language used by this court in Rakestraw v. Lanier, supra, is applicable: Such a contract is "unreasonable, not necessary for the protection of the party in whose favor the restraint was imposed, oppressive to the party restrained, and opposed to the interest of the public." In OrkinExterminating Co. v. Dewberry, 204 Ga. 794 (51 S.E.2d 669), the authorities, in this State and in other jurisdictions on this question are cited and discussed. We do not deem it necessary to do so again in this case.

It follows from what has been said above that there was no error in sustaining the general demurrer and dismissing the petition.

In view of these rulings, it becomes unnecessary to pass upon the other questions raised in this case.

Judgment affirmed. All the Justices concur.