Court Opinion

ID: 9629934
Source: CourtListenerOpinion
Date Created: 2023-08-22 09:53:48.513693+00
Date Added: 2024-06-11T18:07:27.542811
License: Public Domain

POMEROY, Justice
(concurring).
I join the opinion of the Court arid add this separate statement only to set forth in greater detail my reasons for agreeing with the conclusions reached in that opinion.
This is an appeal under the Act of February 14, 1866 P.L. 28, § 1, 12 P.S. § 1101, from a preliminary injunctive decree partially enforcing an employee’s covenant not to compete with his former employer. The restricted scope of our review in cases such as this is well established: “We will look only to see if there were any apparently reasonable grounds for the action of the court below, and we will not further consider the merits of the case or pass upon the reasons for or against such action, unless it is plain that no such grounds existed or that the *603rules of law relied on are palpably wrong or clearly inapplicable.” Lindenfelser v. Lindenfelser, 385 Pa. 342, 343-44, 123 A.2d 626, 627 (1956).1 As the majority concludes, the record in this case does disclose “reasonable grounds” for the relief granted, and the chancellor did not err in his interpretation of the applicable law.
I agree with the opinion of the Court that Sidco had a protectible interest in customer good will created by Aaron through his sales efforts on Sidco’s behalf. This interest, as I see it, is distinct from any protectible interest which Sidco may have in secrets of its trade or in specialized skills acquired by Aaron under Sidco’s tutelage. The observations I made in dissent in Girard Investment Co. v. Bello, 456 Pa. 220, 318 A.2d 718 (1974), are equally applicable to the present case:
“We all agree that the applicable law is to be found in Chapter 18 of the’ Restatement of Contracts (1932). The specific question before us, therefore, is whether the covenant of non-competition . . . is a reasonable restraint of trade as defined in Restatement § 516(f):
‘A bargain by an assistant, servant, or agent not to compete with his employer, or principal, during the term of the employment or agency, or thereafter, within such territory and during such time as may be reasonably necessary for the protection of the *604employee or principal, without imposing undue hardship on the employee or agent.’
“. . .Of course, balancing the conflicting interests of employer and employee may compel the conclusion that no restriction, however narrowly limited in time and space, may be reasonable in a particular case. I cannot agree, however, that we confront such a case today.
“It can hardly be doubted that an employee who, by means of his personal contacts, is in a position to divert a substantial amount of business from his employer may present just as serious a competitive threat as a highly trained specialist; the employer’s corresponding need for protection may be just as great. On the other side of the coin, a non-specialist . . . may suffer much less hardship from a restrictive covenant than a trained technician would since the more specialized a man’s skills, the more limited may be the job openings available to him in his locality. See Restatement, Contracts, § 515, comment e. In short, I see nothing in the policy embodied in Restatement § 516 to justify restricting covenants of non-competition to employees who have received advanced technical training from their employers. Nor do I think that our own cases support such a limitation.” Id. 456 Pa. at 224-227, 318 A.2d at 720-22 (dissenting opinion of Pomeroy, J.).
I am also of opinion that the chancellor properly exercised his discretion in limiting the effective scope of the covenant. Appellant seeks to bring this case within the sweep of our decision in Reading Aviation Service, Inc. v. Bertolet, 454 Pa. 488, 311 A.2d 628 (1973), where we struck down an overly broad restrictive covenant in an employment contract without regard to the possibility that partial enforcement might have served some legitimate interest of the employer. But Reading v. Aviation *605Service is distinguishable on its facts, as Mr. Justice Roberts’ opinion points out. There, the covenant was without limitation in both time and space. Here, on the other hand the covenant was limited to a period of two years following the termination of Aaron’s employment, and was limited in space to Sidco’s trade territory. In this respect, this case is substantially the same as Bettinger v. Carl Berke Associates, Inc., 455 Pa. 243, 314 A.2d 296 (1974), where we affirmed an injunctive decree partially enforcing a restrictive covenant against a former sales employee.2
The unlimited scope of the covenant in Reading Aviation Service, supra, suggests an abuse of superior bargaining power and a callous disregard for an employee’s interest in pursuing his chosen occupation. I am quite prepared to discourage such deliberate overreaching by striking down such covenants in their entirety.3 But this extraordinary sanction is not, in my view, justified on the record before us. In the first place, a more narrowly drawn covenant may not have been possible in this *606case.4 When Aaron .began to work for Sidco his territory was not fixed; it was continually expanded during the period of his employment. It is also worth noting that Sidco did not seek the covenant until after Aaron had completed a two-year apprenticeship., during which he had been systematically exposed to all aspects of Sidco’s business and accompanied more experienced salesmen on their rounds. Sidco contends that it has a protectible interest in the knowledge and skills acquired by Aaron during this period. If this contention is correct, then the chancellor might have been justified in enforcing the covenant according to its original terms, for Aaron may use his sales training to Sidco’s disadvantage in any area where Sidco does business. As we observed in Morgan’s Home Equipment Corp. v. Martucci, 390 Pa. 618, 631, 136 A.2d 838, 846 (1957), an employer is entitled to protection from the use of special training imparted to his employees not only in the solicitation and servicing of former customers, but also “in competition for the patronage of the public at large.” Even if Sid-co’s contention is ultimately rejected, it cannot be said that Sidco’s belief that it has a protectible interest in Aaron’s sales training is so unreasonable as to warrant stripping the company of whatever other protection it may legitimately claim.
In sum, there is evidence in the record that Aaron’s * breach of his covenant has already caused Sidco consid*607erable harm, and is likely to cause further injury. The covenant itself is reasonably limited in time, and is limited in space to Sidco’s trade territory. Sidco did not seek an injunction covering the entire area of the covenant; it requested relief only in the area in which Aaron had formerly operated. The case is on all fours with our recent decision in Bettinger v. Carl Berke Associates, Inc., supra, note 2. It follows that there exist apparently reasonable grounds for the relief granted below.
JONES, C. J., joins in this concurring opinion.

. These restrictions as to our scope of review are born of necessity, for we must consider each such case on an incomplete record, without the benefit of an adjudication by the lower court. The grant of a preliminary injunction is not a final determination on the merits of a case, and a formal adjudication, complete with findings of fact, is neither necessary nor appropriate at this stage. Compare Rule 1517 of the Pennsylvania Rules of Civil Procedure.
In the present case, we are further hampered by the absence of an opinion in support of the chancellor’s decree. An appeal having been taken from the decree, we should have the benefit of the trial court’s reasoning in support of its decision. See Rule 56 of this court.

. In fact, Bettinger and the case at bar are identical in virtually every material respect. In both cases, the defendant employee was hired as a sales representative, and was asked to sign a covenant of non-competition only after he had worked for several months and had become familiar with his employer’s operations. In both cases, the covenant was reasonably limited in time, and was limited in space to the employer’s trade territory; in both cases, the employer sought to enforce the covenant only in the area actually serviced by the employee. Finally, in both cases, there was evidence that the names of the customers served by the employer and his competitors were widely known throughout the industry. Our decision in Bettinger was handed down only last year, and without dissent. I agree with the Court that it is controlling here.

. As we pointed out in Reading Aviation Service, if courts indiscriminately rewrite every overly broad restrictive covenant to pare away unwarranted restrictions on employee rights, employers who negotiate such covenants with their employees will be encouraged to insist on the broadest protection they can get, irrespective of an employer’s legitimate needs or the hardship imposed on his employees. Id., 454 Pa. at 493, 311 A.2d at 630-31. See 14 Williston, Contracts § 1647C (3d ed. 1972).

. As Professor Blake points out, “ . . .in all but the smallest business it is administratively impossible to tailor each covenant to the particular requirements of an individual employee, to say nothing of revising the covenant with each change of the employee’s responsibilities. A comparatively few forms must serve for large numbers of employees in quite different circumstances. Employees themselves may often be suspicious and resentful of unequal treatment. Thus, even when the employer acts in complete good faith, it may happen that in the situation that gets to court the restraint is somewhat more burdensome than would be necessary in the case of the violating party. Yet an injunction may. be clearly appropriate.” Blake, Employee Agreements Not To Compete, 73 Harv.L.Rev. 625, 683 (1960).