Ofsowitz v. Askin Stores, Inc.

306 S.W.2d 923, 1957 Tex. App. LEXIS 2130
CourtCourt of Appeals of Texas
DecidedNovember 1, 1957
Docket3329
StatusPublished
Cited by12 cases

This text of 306 S.W.2d 923 (Ofsowitz v. Askin Stores, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ofsowitz v. Askin Stores, Inc., 306 S.W.2d 923, 1957 Tex. App. LEXIS 2130 (Tex. Ct. App. 1957).

Opinion

COLLINGS, Justice.

This is an injunction suit by Askin Stores, Inc., against Lewis Ofsowitz. Ofsowitz was a former employee of plaintiff corporation under a written contract and plaintiff sought injunctive relief to enforce a restrictive covenant in the contract. The trial court granted judgment against Ofsowitz enjoining him for a period of two years from September 20, 1956, from operating, conducting or in any way becoming interested in or affiliated with *924 any clothing business in the City of San Antonio, Texas, or within IS miles thereof, similar in nature to the stores conducted by plaintiff in said city. Ofsowitz has brought this appeal.

Appellant Ofsowitz first became an employee of appellee on May IS, 1946. On February 17, 1947, he executed the written contract of employment upon which this suit is based. Under the terms of the contract appellant was employed as manager of appellee’s store located in the City of San Antonio, known as the “Seymour’s Store” or as “Seymour’s Credit Clothing Store”. The employment of Ofsowitz as manager of such store by the corporation was by the terms of the contract “at will” and his duties as manager, among other things, were to contract sales, collect monies, make remittances thereof, and perform such other acts and duties as were incident to his employment in accordance with appellee’s instructions. The contract provided that appellant’s compensation should be 5 percent of the amount of all net bank deposits made by the store with a guaranteed minimum of $250 per one-half month. It was further provided by the contract that:

“ * * * the manager specifically undertakes and agrees that in the event of the termination of his employment with the corporation, for any reason whatsoever, he will not for a period of two (2) years from the date of such termination (or if any shorter period by provided by law, then for that period) directly or indirectly enter the employ of or become interested or affiliated or connected with directly or indirectly in any business within San Antonio, Texas, similar or of a like nature to the business of the corporation or in any other city or place wherein the corporation maintains a store and in which store the manager shall have been employed during his said employment or within fifteen (15) miles of San Antonio, Texas, *

It was found by the court and the evidence is undisputed that appellant Ofsowitz in violation of the above set out provision of his contract of employment, prior to his resignation as manager of appellee’s Seymour Store in San Antonio, purchased an interest in a competing installment credit clothing business located next door to the Seymour Store with the intention of becoming manager thereof and in competition with appellee, The'Aslcin Stores.

We overrule appellant’s contention that because of the provision of the contract to the effect that his employment as manager was at the will of the corporation which was not bound to employ him for any specific length of time, the restrictive covenant in question which was not to take effect until after his employment was ended, was without consideration and therefore unenforceable. This identical question was decided adversely to appellant’s contention in the case of Krueger, Hutchinson and Overton Clinic v. Lewis, Tex.Civ.App., 266 S.W.2d 885, affirmed 153 Tex. 363, 269 S.W.2d 798. See also McAnally v. Person, Tex.Civ.App., 57 S.W.2d 945 (Writ Ref.).

Appellant further contends in several points that the court erred in granting the injunction against him because the contract, and the restrictive covenant therein, were unfair and unreasonable. The general rule is that an employee’s covenant not to engage in competing business against his employer after the termination of his employment contract, may be enforced if the restriction is reasonable in respect to the time it imposes, the territory it embraced and is reasonably necessary to protect some legitimate interest of the employer in the operation of his business. 10 Tex.Jur. 227; Vol. 3, Tex.Jur. 10 Yr. Sup., Contracts, par. 133; Parker v. Smith, Tex.Civ.App., 254 S.W.2d 144. The burden to establish the reasonableness of the restrictive covenant is on the employer. McAnally v. Person, supra.

*925 In this connection the evidence shows that appellant Ofsowitz entered into the employment of appellee as manager of its Seymour Store in San Antonio in 1946. Appellant’s duties as manager included the sale of merchandise. He continued in this employment in the same capacity and location until the termination of his connection with appellee in September, 1956. There was evidence to the effect that during this period Ofsowitz was a capable and energetic manager of appellee’s Seymour Store. He directed and managed the work of other employees of the store and made many personal contacts with customers. These contacts were made by meeting and greeting customers who came to the store, by occasional participation in arrangements for terms of payments, in arrangements for payments under a lay-a-way plan, in collecting money from customers as down-payments, in resolving complaints of customers and by occasionally making or participating in direct sales to customers. The evidence further shows that appellant’s acquaintance and good will was such that some customers coming to Seymour Store called for Ofsowitz personally. The evidence shows as heretofore indicated that the competing credit clothing business in which appellant has become interested and which he expects to operate as manager is located next door to appellee’s Seymour Store in San Antonio where appellant has been so employed as manager and has developed an exceptional business and good will for himself and for appellee, The Askin Stores, over a period of about ten years. Contrary to appellant’s contention there was ample evidence that the planned operation by appellant of a credit clothing store next door to the Seymour Store would, or in all probability would, injure or adversely affect some legitimate business interest of the appellee. This evidence in our opinion supports the finding of the trial court:

“ * * * that said contract of employment and the covenant and restrictions * * * set forth were and are reasonable and essential to plaintiff for the protection of its business in the event of termination of defendant’s said employment and is therefore valid and enforceable.”

Appellant’s points urging, in effect, that the contract and the restrictive covenant therein were and are unfair and unreasonable are overruled.

Appellant further contends that the conduct of appellee, The Askin Stores, during the life of the contract was so inequitable as to deprive it of the right to relief in an equitable proceeding.

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Bluebook (online)
306 S.W.2d 923, 1957 Tex. App. LEXIS 2130, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ofsowitz-v-askin-stores-inc-texapp-1957.