Orkin Exterminating Co., Inc. v. Foti

287 So. 2d 569
CourtLouisiana Court of Appeal
DecidedApril 5, 1974
Docket4369
StatusPublished
Cited by7 cases

This text of 287 So. 2d 569 (Orkin Exterminating Co., Inc. v. Foti) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Orkin Exterminating Co., Inc. v. Foti, 287 So. 2d 569 (La. Ct. App. 1974).

Opinion

287 So.2d 569 (1973)

ORKIN EXTERMINATING CO., INC., Plaintiff and Appellant,
v.
James T. FOTI, Defendant and Appellee.

No. 4369.

Court of Appeal of Louisiana, Third Circuit.

November 30, 1973.
Rehearing Denied January 21, 1974.
Writ Granted April 5, 1974.

*570 Dubuisson & Dubuisson, by James T. Guglielmo, Opelousas, for plaintiff-appellant.

Taylor & Trosclair, by Earl B. Taylor, Opelousas, for defendant-appellee.

Before FRUGE, MILLER, and DOMENGEAUX, JJ.

DOMENGEAUX, Judge.

This action for injunctive relief was instituted by Orkin Exterminating Co., Inc. against James Foti alleging breach of defendant's employment contract which contained provisions not to compete on the termination of his employment. After trial the district court granted a limited injunction in favor of plaintiff and against the defendant for two years from the date of defendant's termination of employment. The plaintiff appealed from this judgment. The defendant neither appealed nor answered plaintiff's appeal.

The plaintiff is substantially the largest exterminating corporation in the United States with operations and branch offices throughout the state of Louisiana. The defendant, James Foti, was first employed by Orkin in February 1968 as a salesman in Lafayette. Eighteen months later he was promoted to manager of the New Iberia office and thereby signed an employment contract which contained non-competition provisions. In June 1971 Foti was transferred to Monroe and was promoted to a branch manager position, again signing a similar employment contract. Thereafter, in order that he could be exposed to business management ideas and principles, Foti was transferred to the Louisiana District Office in Alexandria. Once again he signed another new employment contract on January 14, 1972. As this contract is *571 the particular one in question we quote its pertinent parts as follows:

"The Employee hereby expressly covenants and agrees, which covenants and agreements are of the essence of this contract, that he will not, during the term of this agreement and for a period of two (2) years immediately following the termination of this agreement, for any reason whatsoever, directly or indirectly, for himself or on behalf of, or in conjunction with, any other person, persons, company, partnership or corporation:
(a) call upon any customer or customers of the Company solicited or contacted by the Employee or whose account was serviced by the Employee, pursuant to his employment hereunder, for the purpose of soliciting or selling any pest control, exterminating, fumigating or termite control service for the eradication or control of rats, mice, roaches, bugs, vermin, termites, beetles or other insects within the territory stated in Paragraph 8(e);
(b) nor will he divert, solicit or take away any such customer or customers of the Company or the business or patronage of any such customers of the Company for the purpose of selling a service for eradication or control of rats, mice, roaches, bugs, vermin, termites, beetles or other insects within the territory stated in Paragraph 8(e);
(c) nor will he call upon, divert or solicit any person, persons, company, partnership or corporation for the purpose of selling any service for the eradication or control of rats, mice, roaches, bugs, vermin, termites, beetles or other insects within the territory stated in Paragraph 8(e);
(d) nor will he service any contracts or accounts for other employers, or for himself, anywhere within the territory stated in Paragraph 8(e);
(e) nor will he engage in the lawn and ornamental pest control service, pest control, exterminating, fumigating or termite control business as a manager/salesman/serviceman anywhere within the territory as specifically delineated and described as follows: The cities of Alexandria, Crowley, Monroe, Lafayette, Lake Charles, Natchitoches, New Iberia, Shreveport and Ruston all in the state of Louisiana and a radius of fifty miles of and from the official geographical boundaries of each city and town listed in this sub-paragraph 8e."

Thereafter Foti was transferred to Opelousas as a branch manager on April 1, 1972. No new contract of employment was signed after this transfer.

On September 30, 1972, Foti terminated his employment with Orkin, thereafter forming his own exterminating company, Yambilee Exterminating Co., Inc. on October 9, 1972. He began soliciting and doing business in the Opelousas and surrounding area including New Iberia, Bunkie, Marksville, Breaux Bridge, and St. Martinville. By his own testimony Foti admitted contacting and servicing former customers of Orkin.

On December 29, 1972, Orkin filed this suit praying for an injunction to restrict Foti from doing business in those respects which the above quoted contract provision provided.

The trial court granted a limited injunction, only recognizing sections (a) and (b) in the above cited contract.

Orkin appealed alleging that the entire "non-competition" clause should have been upheld.

We feel bound to follow our decision in National Motor Club of Louisiana, Inc. v. Conque, 173 So.2d 238 (La.App.3rd Cir. 1965), writs denied, 247 La. 875, 175 So.2d 110, and consider it to be controlling herein. Therefore we quote extensively *572 from the language used by Judge [now Justice] Tate therein.

"The basic provision of LSA-R.S. 23:921, incorporating the public policy of this state, flatly provides: `No employer shall require or direct any employee to enter into any contract whereby the employee agrees not to engage in any competing business for himself, or as the employee of another, upon the termination of his contract of employment with such employer, and all such contracts, or provisions thereof containing such agreement shall be null and unenforceable in any court * * *.' The 1962 amendment to be discussed below, permits a limited exception to this broad policy.
Even prior to the enactment by Act 33 of 1934 of this prohibition against exaction of noncompetitive agreements from employees, they were consistently held to be unenforceable. Cloverland Dairy Products v. Grace, 180 La. 694, 157 So. 393 (1943); Blanchard v. Haber, 166 La. 1014, 118 So. 117 (1928). See 27 Tul.L. Rev. 364 (1953). (In most states other than Louisiana, however, noncompetitive contracts are recognized if reasonably restricted as to time and area. See Annotations at 41 A.L.R.2d 15 and 43 A.L. R.2d 94.) In the absence of an enforceable contract to other effect, an employee has the absolute right to actively serve a business competing with his former employer after leaving the latter's service, Jones v. Ernst & Ernst, 172 La. 406, 134 So. 375 (1931); as, for instance, does a former officer who actively competes with his former corporate principal, Marine Forwarding & Shipping Co. v. Barone, La.App.Orl., 154 So. 2d 528 (1963).
As noted in these decisions, their essential basis is the right of individual freedom and of individuals to better themselves in our free-enterprise society, where liberty of the individual is guaranteed.

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287 So. 2d 569, Counsel Stack Legal Research, https://law.counselstack.com/opinion/orkin-exterminating-co-inc-v-foti-lactapp-1974.