R Homes Corp. v. Herr

123 P.3d 720, 142 Idaho 95
CourtIdaho Court of Appeals
DecidedNovember 7, 2005
Docket30667
StatusPublished
Cited by3 cases

This text of 123 P.3d 720 (R Homes Corp. v. Herr) is published on Counsel Stack Legal Research, covering Idaho Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
R Homes Corp. v. Herr, 123 P.3d 720, 142 Idaho 95 (Idaho Ct. App. 2005).

Opinion

123 P.3d 720 (2005)
142 Idaho 95

R HOMES CORPORATION, Plaintiff-Appellant,
v.
Roger HERR, individually; Superior Modular Systems, LLC., an Idaho limited liability company, Defendants-Respondents, and
John Does 1-10, and Black and White Corporation 1-5, Defendants.

No. 30667.

Court of Appeals of Idaho.

November 7, 2005.

*722 Craig R. Jorgensen, Pocatello, for appellant.

Racine, Olson, Nye, Budge & Bailey, Chartered, Pocatello, for respondents. John R. Goodell argued.

LANSING, Judge.

This is an appeal from a district court's grant of summary judgment for the defendant in an action by the defendant's former employer alleging that he breached his fiduciary duty of loyalty to the employer by soliciting customers and recruiting fellow employees for a new competing company. We affirm.

I.

BACKGROUND

Plaintiff R Homes Corporation operated a manufacturing plant for the construction of modular homes and other structures. R Homes hired defendant Roger Herr as its sales manager in June 1999. R Homes initially wanted Herr to sign a non-competition agreement, but he refused and was nevertheless employed. During Herr's employment, R Homes had financial difficulty, including intermittent employee layoffs and inability to meet payroll. Herr resigned effective January 1, 2000, and in February 2000, he opened a new competing modular home manufacturing business known as Superior Modular Systems (SMS). In mid-January 2001, R Homes filed for Chapter 11 bankruptcy protection and laid off all of its remaining employees. It ultimately went out of business.

R Homes filed an action against Herr claiming that while still employed by R Homes, he solicited its customers for his new business and recruited its employees in violation of his fiduciary duty of loyalty, and that these actions significantly damaged the company. Herr contends that while he did eventually do work for R Homes's former customers and hired its former employees, he did not solicit or recruit them while employed there. Rather, he claims that the customers asked SMS to undertake or complete projects because they had lost confidence in R Homes and that the employees came to SMS seeking work.

Herr moved for summary judgment, and in response R Homes submitted several affidavits. The district court initially granted partial summary judgment dismissing only the customer solicitation claim, finding no evidence that Herr had solicited R Homes's customers before terminating his employment there. Herr later renewed his motion for summary judgment on the employee recruitment claim, submitting twenty-two affidavits from SMS employees who had worked for R Homes, each stating that the individual had not been recruited by Herr. R Homes responded with an additional affidavit and requested a one-month extension to submit further material in opposition to the motion. *723 The district court granted the request reluctantly because it had previously allowed a three-month extension. At the end of the extension term, the court granted Herr's motion after first striking portions of R Homes's affidavits as inadmissible hearsay or as lacking foundation. R Homes appeals.

II.

ANALYSIS

Summary judgment under Idaho Rule of Civil Procedure 56(c) is appropriate only when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. When a summary judgment motion has been supported by depositions, affidavits or other evidence, the adverse party "may not rest upon the mere allegations or denials of that party's pleadings, but the party's response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial." I.R.C.P. 56(e). See also Gardner v. Evans, 110 Idaho 925, 929, 719 P.2d 1185, 1189 (1986). When a court considers a motion for summary judgment, all facts are to be liberally construed in favor of the nonmoving party, and the court must draw all reasonable inferences in favor of the party resisting the motion. G & M Farms v. Funk Irrigation Co., 119 Idaho 514, 517, 808 P.2d 851, 854 (1991); Sanders v. Kuna Joint Sch. Dist., 125 Idaho 872, 874, 876 P.2d 154, 156 (Ct.App.1994). "[T]he motion must be denied if the evidence is such that conflicting inferences may be drawn therefrom, and if reasonable people might reach different conclusions." Olsen v. J.A. Freeman Co., 117 Idaho 706, 720, 791 P.2d 1285, 1299 (1990). Nevertheless, a mere scintilla of evidence or only a slight doubt as to the facts is insufficient to withstand summary judgment; there must be sufficient evidence upon which a jury could reasonably return a verdict for the party opposing the motion. Corbridge v. Clark Equip. Co., 112 Idaho 85, 87, 730 P.2d 1005, 1007 (1986); Petricevich v. Salmon River Canal Co., 92 Idaho 865, 871, 452 P.2d 362, 368 (1969).

The party seeking summary judgment bears the initial burden to show that there is no genuine issue of material fact and that he or she is entitled to judgment as a matter of law. McCorkle v. Northwestern Mut. Life Ins. Co., 141 Idaho 550, 554, 112 P.3d 838, 842 (Ct.App.2005); Eliopulos v. Knox, 123 Idaho 400, 404, 848 P.2d 984, 988 (Ct.App.1992). The movant may meet this burden by establishing the absence of evidence on an element that the nonmoving party will be required to prove at trial. Dunnick v. Elder, 126 Idaho 308, 311, 882 P.2d 475, 478 (Ct.App.1994). This may be accomplished either by an affirmative showing with the moving party's own evidence or by a review of the nonmovant's evidence and the contention that the required proof of an element is lacking. Heath v. Honker's Mini-Mart, Inc., 134 Idaho 711, 712, 8 P.3d 1254, 1255 (Ct.App.2000). Once such an absence of evidence has been demonstrated, the burden shifts to the party opposing the motion to show through further depositions, discovery responses or affidavits that there is indeed a genuine issue for trial or to show a valid justification for its failure to do so under I.R.C.P. 56(f). Sanders, 125 Idaho at 874, 876 P.2d at 156.

The claims in this case are based upon the duty of loyalty owed by an employee/agent to an employer/principal. The Idaho Supreme Court has long described the relationship between principal and agent as a fiduciary relationship. In Jensen v. Sidney Stevens Implement Co., 36 Idaho 348, 353, 210 P. 1003, 1005 (1922), the Court found the following jury instruction to be a correct statement of Idaho law:

Loyalty to his trust is the first duty which an agent owes to his principal. It follows as a necessary conclusion that the agent must not put himself in such a relationship that his interests become antagonistic to those of his principal.

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Bluebook (online)
123 P.3d 720, 142 Idaho 95, Counsel Stack Legal Research, https://law.counselstack.com/opinion/r-homes-corp-v-herr-idahoctapp-2005.