Opinion ID: 1140801
Heading Depth: 1
Heading Rank: 8

Heading: Breach-of-Contract Claim Against Brooks

Text: Brooks and Systrends argue that the trial court erred in denying their motion for a judgment as a matter of law as to the validity of the noncompetition provision. [3] They argued to the trial court that the provision did not designate a specific location within which the restrictions in that provision would apply and that it thus was not reasonably limited in scope. They further asserted that even if the trial court applied the definition in the provision of Group 8760's territory as the entire world, the scope was still unreasonable and the provision void. Alabama Code § 8-1-1 states in relevant part: (a) Every contract by which anyone is restrained from exercising a lawful profession, trade, or business of any kind otherwise than is provided by this section is to that extent void. (b) One who sells the good will of a business may agree with the buyer and one who is employed as an agent, servant or employee may agree with his employer to refrain from carrying on or engaging in a similar business and from soliciting old customers of such employer within a specified county, city, or part thereof so long as the buyer, or any person deriving title to the good will from him, or employer carries on a like business therein. We have stated that Alabama courts will enforce a covenant not to compete that fits within the exception of § 8-1-1(b) only if: `1. the employer has a protectable interest; `2. the restriction is reasonably related to that interest; `3. the restriction is reasonable in time and place; [and] `4. the restriction imposes no undue hardship [on the employee].'  DeVoe v. Cheatham, 413 So.2d 1141, 1142 (Ala.1982). Clark v. Liberty Nat'l Life Ins. Co., 592 So.2d 564, 565-66 (Ala.1992). A noncompetition agreement may `properly include part of Alabama, all of Alabama, or more territory than the State of Alabama, depending on the circumstances.' Id. at 566 (quoting James S. Kemper & Co. v. Cox & Assocs., Inc., 434 So.2d 1380, 1385 (Ala.1983)) (footnote omitted). See also Clark, 592 So.2d at 566 n. 2; Central Bancshares of the South, Inc. v. Puckett, 584 So.2d 829 (Ala.1991); James S. Kemper & Co. v. Cox & Assocs., Inc., supra; and Parker v. EBSCO Indus., Inc., 282 Ala. 98, 209 So.2d 383 (1968). In paragraph 19 of their motion, Brooks and Systrends acknowledged that Alabama courts may restrict overly broad provisions of agreements in restraint of trade and instead enforce reasonable limitations as to location. We recently recognized: `An agreement in restraint of trade may be divisible. An unreasonable limitation or restriction may be stricken. . . .' Cullman Broad. Co. v. Bosley, 373 So.2d 830, 835 (Ala.1979). Furthermore, `a court of equity has the power to enforce a contract against competition although the territory or period may be unreasonable, by granting an injunction restraining the respondent from competing for a reasonable time and within a reasonable area.' Mason Corp. v. Kennedy, 286 Ala. 639, 645, 244 So.2d 585, 590 (1971). King v. Head Start Family Hair Salons, Inc., 886 So.2d 769, 772 (Ala.2004). As noted earlier, the agreement between Brooks and Group 8760 states, in relevant part, that if any provision relating to the geographical area of the restriction should be judicially declared to exceed the maximum geographical areas deemed reasonable by the court, the geographical area deemed reasonable and enforceable by the court would be the maximum geographical area. By the parties' agreement, therefore, the trial court had additional authority to limit the scope of the restrictive covenant. On appeal, Brooks and Systrends argue that because Group 8760 does not seek solely equitable relief, we must strictly construe the noncompetition provision so as to read into it the statutory language of § 8-1-1. They assert that our cases, which analyze noncompetition agreements in an equitable context and permit courts to restrict overly broad noncompetition agreements, do not apply to a case where money damages are sought in addition to injunctive relief. Because Brooks and Systrends raise this argument regarding strict construction and a circuit court's equitable power for the first time on appeal, we will not consider it. See, e.g., Bosarge Offshore, LLC v. Compass Bank, 943 So.2d 782 (Ala.2006) (``This Court cannot consider arguments advanced for the purpose of reversing the judgment of a trial court when those arguments were never presented to the trial court for consideration or were raised for the first time on appeal.'') (quoting other cases); Brown ex rel. Brown v. St. Vincent's Hosp., 899 So.2d 227, 235 (Ala.2004). Under the evidence before the trial court at the time Brooks and Systrends moved for a judgment as a matter of law, Brooks's actions in violation of the noncompetition provision implicated a geographically reasonable area. His work on the PEPCO and ERCOT matters, relating respectively to the District of Columbia and Texas, form the primary basis of Group 8760's breach-of-contract claim. The evidence showed that for most of the time Brooks worked on those matters he lived in Alabama. Accordingly, the trial court could have reasonably restricted the noncompetition provision to those areas and properly submitted Group 8760's claims to the jury. Because this court `may affirm a trial court's judgment on any valid legal ground presented by the record, regardless of whether that ground was considered, or even if it was rejected, by the trial court,' Unum Life Ins. Co. of America v. Wright, 897 So.2d 1059, 1082 (Ala.2004) (quoting Liberty Nat'l Life Ins. Co. v. University of Alabama Health Servs. Found., 881 So.2d 1013, 1020 (Ala. 2003)), we affirm the trial court's denial of Brooks's and Systrends' motions for a judgment as a matter of law on this issue. See also Wilson v. Athens-Limestone Hosp., 894 So.2d 630, 634 (Ala.2004). Regarding Brooks and Systrends' additional argument that, as written, the noncompetition provision would impose an undue hardship on Brooks and was therefore void, we note that the provision merely prohibited Brooks from competing with Group 8760 for one year and did not otherwise prevent him from obtaining employment within the relevant industry. Furthermore, as restricted to the geographic areas at issue in the action, the provision imposed no undue hardship. We therefore affirm the trial court's denial of Brooks's and Systrends' motions for a judgment as a matter of law as to this argument as well. The trial court gave the jury the following charge regarding the validity of the noncompetition provision: In Alabama a noncompetition agreement, restraining employment, . . . is disfavored because they [sic] tend to not only deprive the public of efficient services, but tend to impoverish the other individual. However, under the law in Alabama, the courts will enforce a covenant not to compete or a noncompetition agreement in an employment contract if certain elements exist. Now, those elements are [these]: Number one, that the employer, that would be Group 8760, has a protectable interest. Number two, the restriction is reasonably related to that interest. Number three, the restriction is reasonable [in time and place]. Number four, the restriction imposes no undue hardship on the other party. The burden is upon Group 8760 to show to you that this contract is not void and that it is enforceable under Alabama law. . . . . . . . In addition, the restriction must be reasonable [as to] time and place. As far as time and place is concerned, the territory of a covenant not to compete may properly include part of Alabama, all of Alabama, or more territory than the State of Alabama, depending upon the circumstances in each case. It's for you and you alone to decide that question in this matter, whether or not the area and time is reasonable or not for the protection of the interest of Group 8760 in this case. . . . . . . . [Y]ou must determine whether or not the contract between Group 8760 and Richard Brooks was valid and enforceable. . . .  (R. 2333-35, 2336, 2347.) No party objected to the trial court's submission to the jury for determination the questions of whether or not the contract between Group 8760 and Richard Brooks was valid and enforceable and whether or not the area and time is reasonable or not for the protection of the interest of Group 8760 in this case. No party raises as an issue on appeal the submission of this charge to the jury or the propriety of this charge. The charge, therefore, which placed the determinations of whether the noncompetition provision was void and whether the provision was unreasonably restrictive as to location within the province of the jury, became the law of the case, and authorized the jury to act in conformity with that charge. See Alabama Dep't of Transp. v. Land Energy, supra. After the jury's verdict for Group 8760, Brooks and Systrends renewed their motions for a judgment as a matter of law. Because the jury charges were then the law of the case, the renewed motions must be viewed in that legal context. From that viewpoint, the jury had the authority to, and did, decide that the noncompetition provision was valid and reasonably limited as to time. Under the evidence, and in light of the then existing law of the case, the trial court did not err in denying the renewed motions. We do not today decide whether, or under what circumstances, Alabama courts might enforce a noncompetition agreement that specifies the world as a location. See Westwind Techs., Inc. v. Jones, 925 So.2d 166, 172-74 (Ala.2005) (See, J., concurring specially). Rather, given the specific procedural circumstances of this case, we decide that the trial court did not err in denying the motions for a judgment as a matter of law. Finally, because we decide the jury's verdict was not based upon sufficient evidence from which it could allocate damages, as explained elsewhere, and Brooks and Systrends therefore are entitled to a new trial, we need not address their motions for a new trial based on the question of the validity of the noncompetition provision.