Court Opinion

ID: 9516071
Source: CourtListenerOpinion
Date Created: 2023-08-06 23:33:49.537799+00
Date Added: 2024-06-11T09:14:20.357701
License: Public Domain

SULLIVAN, Judge,
with whom GAR-RARD, Presiding Judge, joins, concurring.
As I interpret the argument of Dr. Gomez, it is that a termination without good cause renders an otherwise enforceable non-competition clause unenforceable. Gomez does not argue that employees-at-will should never be subject to non-competition clauses; nor does he argue that such provisions are, as a matter of public policy, unenforceable against practicing members of the medical profession.
The indispensable foundation for an enforceable non-competition covenant against an employee is that the employer has a legitimate and protectable good-will property interest. See Field v. Alexander & Alexander of Indiana, Inc. (1987) 2d Dist. Ind.App., 508 N.E.2d 627. It also stands to reason that unless such protectable property interest is more important than the public access to medical treatment, the non-competition provision should be carefully scrutinized.
The provision in question seems to focus upon the prospective loss of patients from Dr. Chua's practice if Dr. Gomez were permitted to engage in his medical specialty within the proscribed thirty-mile radius for the period of two years. Although I might find it more palatable to enforce a clause which would prohibit Dr. Gomez from soliciting and treating former or existing patients of Dr. Chua during the period, I am unable to discern that Dr. Chua has any vested property right in his patients and their medical problems; nor am I able to discern how such property interest, if any, is validly protected by prohibiting Dr. Gomez from seeing any patients. The blanket prohibition can be validated only if we accept the proposition that Dr. Chua is entitled to a virtual monopoly with respect to his specialty.
New competitive economic forces are emerging not only in the health care industry but in other occupations and callings which have been traditionally thought of as professions. These new forces are a reality but their very existence seems to be transforming the professions into true commercial industries. The transformation, in my view, should be discouraged, if not condemned and prohibited.
Our public policy recognizes that teachers, firefighters, police, and other public employees may not, by labor strikes, deny necessary services to the community. The rationale underlying this prohibition is, at least in part, that even though strikes are "a matter of choice of political philosophies, [they] cannot and must not be permitted if the orderly function of our society is to be preserved." Anderson Federation of Teachers v. School City of Anderson (1969) 252 Ind. 558, 563, 251 N.E.2d 15, 18, quoting from United States v. United Mine Workers (1947) 330 U.S. 258, 67 S.Ct. 677, 91 L.Ed. 884. Although the doctors in this case are not public employees, the same essentiality of services is involved. For this reason I would place private non-competition clauses, at least with respect to the medical and legal professions, in the same forbidden category.
However, in Raymundo v. Hammond Clinie Association (1983) Ind., 449 N.E.2d 276, 279, our Supreme Court held:
"With respect to Dr. Raymundo's claim that the covenant is inimical to the public interest and unenforceable as a matter of public policy, he has not supported his claim with cogent argument or authority *197as to why physician's agreement not to compete should be treated differently, as a matter of public policy, than that of other business or professional people. His comments that it is in the public interest for physicians, as a group, to determine their code of conduct and ethical standards, that enforcement of such covenants may inflict a hardship upon the covenantor and that the public may thereby be denied medical services are unpersuagive in the light of the public interest in the freedom of individuals to contract."
I am therefore compelled to concur in the affirmance of the summary judgment which enforces the non-competition clause. Were it not for Raymundo, and if Dr. Gomez had advanced the public policy argument, I would have taken a different course.
To be sure, persons are entitled to freely bargain the terms and conditions of employment. Absent some overriding policy consideration, those terms and conditions must be honored by the parties and enforced by the courts. However, I am of the view that a contract provision which serves to severely restrict or deny medical facilities or treatment to members of the public is contrary to public policy and should not be enforced.
The medical profession itself condemns non-competition clauses such as here involved. The Opinions of the Council on Ethical and Judicial Affairs of the American Medical Association (1986) § 9.02 provides:
"AGREEMENTS RESTRICTING THE PRACTICE OF MEDICINE. The counsel on Ethical and Judicial Affairs discourages any agreement between physicians which restricts the right of a physician to practice medicine for a specified period of time or in a specified area upon termination of employment or a partnership or a corporate agreement. Such restrictive agreements are not in the public interest."
I would consider it extremely unlikely that a similar non-competition clause would be approved and enforced were it involved in the termination of a legal partnership, association or corporation. The Indiana Rules of Professional Conduct, Rule 5.6 and the Comment thereto provide:
"RULE 5.6 RESTRICTIONS ON RIGHT TO PRACTICE
A lawyer shall not participate in offering or making:
(a) a partnership or employment agreement that restricts the rights of a lawyer to practice after termination of the relationship, except an agreement concerning benefits upon retirement; or
(b) an agreement in which a restriction on the lawyer's right to practice is part of the settlement of a controversy between private parties.
COMMENT
An agreement restricting the right of partners or associates to practice 'after leaving a firm not only limits their professional autonomy but also limits the freedom of clients to choose a lawyer. Paragraph (a) prohibits such agreements except for restrictions incident to provisions concerning retirement benefits for service with the firm.
Paragraph (b) prohibits a lawyer from agreeing not to represent other persons in connection with settling a claim on behalf of a client."
I cannot imagine that our Supreme Court would voice public acceptance, endorsement, and enforcement of an agreement which would subject the parties to disciplinary sanctions imposed by that very court. By the same token it seems somewhat surprising that our courts have approved an equally unethical act on the part of doctors.
It ill behooves the judicial process to condone and enforce provisons which are not only contrary to public policy but which violently contravene the clear-cut ethical - mandates of the medical profession itself. For these reasons it is not inappropriate, I think, to hope for our Supreme Court to conduct a reexamination of its earlier-stated view that the freedom of contract must *198remain inviolate even if the public policy is disserved.
GARRARD, P.J., concurs.