Fish v. Collins

9 Va. Cir. 64, 1987 Va. Cir. LEXIS 54
CourtFrederick County Circuit Court
DecidedFebruary 18, 1987
DocketCase No. (Chancery) C-86-141
StatusPublished

This text of 9 Va. Cir. 64 (Fish v. Collins) is published on Counsel Stack Legal Research, covering Frederick County Circuit Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Fish v. Collins, 9 Va. Cir. 64, 1987 Va. Cir. LEXIS 54 (Va. Super. Ct. 1987).

Opinion

By JUDGE ROBERT K. WOLTZ

This proceeding involves a dispute over the enforceability of a non-competition covenant contained in an employment contract between the complainant and the defendant, both of whom are veterinarians. The employment has terminated. By this suit the complainant former employer seeks an injunction and damages against the defendant former employee based on the covenant. After previous ore tenus hearing on application for a temporary injunction, a conditional and limited injunction was awarded against the defendant for reasons set out in prior written opinion. Further ore tenus hearing having been had, decision is now made whether permanent injunction should be granted and, if so, the extent and terms of it.

By way of preliminary, the final point of defendant’s demurrer on the ground that the bill of complaint is defective because it prays for monetary damages in addition to injunctive relief is overruled. The cases are numerous that if equity jurisdiction is invoked bona fide all related ancillary matters may be resolved in the proceeding, including those which standing alone would be subject only to jurisdiction at law.

The contract became effective November 1, 1984, and was to remain in effect for one year, at which time it was to be renegotiated "to the satisfaction of both [65]*65parties." The defendant was the employee of the complainant at an annual salary of approximately $35,000 per year. It covered a number of items, such as transportation expense, disability and professional liability insurance, vacation and sick leave provisions, attendance and expenses at conferences and other matters. The complainant, unaided by legal assistance, was the scrivener of the one-page eleven-paragraph agreement. The eighth paragraph is the subject of controversy and provides:

Should you leave your practice with me for what ever reason it is agreed that you not enter into any new competing practice situation within a redius (sic) of 25 miles for a period of 5 years. It is further understood that in this event all practice records and files shall remain my property.

The complainant has practiced for twenty-eight years, twenty-three in Frederick County. Of those eighteen years were with the Winchester Animal Hospital until August, 1983. He then sold his interest in it, thinking of retirement but refusing to enter a non-competition covenant, and about a month later established practice as a sole proprietor in the Frederick County settlement of Clearbrook.

The defendant at the time of entering the contract was forty years of age, a native of Australia and has a United States permanent resident’s visa. He holds a degree in veterinary science from the University of Queensland, Australia, and graduate diplomas or degrees from the University of Edinburgh, Scotland, and the University of California, Davis. His training and experience have been mostly in the field of large animals, particularly "food animals" and especially with dairy cattle. For nearly three years he had been a clinical instructor and assistant professor in the Virginia-Maryland Regional College of Veterinary Medicine at Virginia Polytechnic Institute and State University. He has been licensed in Australia, Great Britain, California, Maryland and Virginia. Shortly before the contract he became board certified in theriogenology, a specialized branch of veterinary medicine concerning animal reproduction and its problems.

[66]*66The parties first became acquainted when the complainant called for assistance from the veterinary college on problems in a herd of cattle of one of his clients. The defendant made several trips in this regard and eventually the problems were largely abated. The parties discussed a possible association and two months after the complainant established his new practice the employment contract was made. The complainant then introduced the defendant and publicized and promoted him and his qualifications in various ways.

The complainant as employer found no fault with the defendant’s work and held his professional abilities in high regard. Nor does the evidence disclose any personality conflicts or serious disagreements between the two. Their association, however, was proving unprofitable to the employer. Two months before the expiration of the one-year period covered by the contract, the complainant showed the defendant figures on their respective production of income up to that time. Complainant stated as employer he was losing money on the defendant at his present salary and could not afford to keep him if the receipts of the practice did not increase greatly. Complainant offered to renew or extend the contract on the basis of either 30% or 35%, depending upon a contingency, of the gross income defendant produced. After considering this offer for a couple weeks, the defendant stated he could not accept it as it was too low. No further proposals were made, and the employment ended at the expiration of the one-year term.

The defendant has remained in this area and seven weeks after leaving the employment entered into a contract with Winchester Animal Hospital, the entity with which complainant had been until two and a half years before, by the terms of which he was "an independent contractor." As such he was "to perform all veterinary services related to the hospital’s food animal practice and be entitled to one-third of all fees for work performed at the hospital." In addition, he was to perform various testing at a livestock exchange, the proceeds from this work up to a specified sum to be "turned over" to the hospital, after which the complainant would retain all further proceeds from that source. Additionally, defendant was to reimburse the hospital for laboratory fees and drugs [67]*67used, be responsible for his own liability insurance, hold the hospital harmless from any claims resulting from his rendering veterinary services and pay a specific amount for use of certain of the hospital’s equipment.

The livestock exchange has been a long-time client of the hospital. A client list submitted in evidence by the complainant shows that the hospital has served many of those persons before and since the complainant sold his interest in it. The hospital has a contract with the livestock exchange and is paid directly by the exchange for the work defendant does there. The defendant has served a number of people appearing on the complainant’s client list but the evidence is not clear whether this has been done on his own or through the animal hospital or both.

After the defendant left him, the complainant noticed that the gross income of his practice soon began to drop, though his new practice had been growing before that. The decline in gross income was steady and up to $3,000 per month but after a few months the decline bottomed out and the gross began again to increase. He further testified that he is financially better off now without the defendant than he was with him, but that his practice with the defendant was probably 60% with large animals and 40% in other areas and that now less than 50% of his practice is in the large animal field. He also testified that while he believes the defendant is serving a substantial number of persons on his client list he is unable for reasons of professional ethics to inquire of them on this. He further testified that a five-year restriction on competition was reasonable as the client relationship often does not last longer than that, the clients frequently tending to forget and drift away. No evidence contrary to this was presented.

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Bluebook (online)
9 Va. Cir. 64, 1987 Va. Cir. LEXIS 54, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fish-v-collins-vaccfrederick-1987.