Court Opinion

ID: 9608510
Source: CourtListenerOpinion
Date Created: 2023-08-22 03:13:57.333159+00
Date Added: 2024-06-11T12:03:33.071068
License: Public Domain

TYSON, Judge,
concurring in part, dissenting in part.
I concur with the majority’s opinion except for section VIII, Equitable Relief. I would remand this case to the trial court for hearing and findings of fact regarding whether plaintiff is entitled to equitable relief. I respectfully dissent from section VIII.
This Court’s standard to review the denial of a preliminary injunction is de novo. The decision to grant or deny injunctive relief remains discretionary, and its terms must comply with Rule 65(d). The limited record before us does not provide a basis to grant or deny equitable relief.
As a general rule, a preliminary injunction
is an extraordinary measure taken by a court to preserve the status quo of the parties during litigation. It will be issued only (1) if a plaintiff is able to show likelihood of success on the merits of his case and (2) if a plaintiff is likely to sustain irreparable loss unless the injunction is issued, or if, in the opinion of the Court, issuance is necessary for the protection of a plaintiff’s rights during the course of litigation.
Investors, Inc. v. Berry, 293 N.C. 688, 701, 239 S.E.2d 566, 574 (1977) (citations omitted). Plaintiff met the first prong for issuance of a preliminary injunction by showing likelihood of prevailing at trial. The covenants are legally enforceable, and Carroll’s establish*17ment of a practice in Hillsborough violates the time and place restrictions in the covenants. Jeff did not breach, repudiate, or novate the agreement.
The second prong requires a showing of irreparable harm. “In every case where the covenant not to compete is found to be reasonable and valid, however, the plaintiff is entitled to a remedy; either the agreement must be enforced or the court must find that plaintiff has an adequate remedy at law for money damages.” A.E.P. Industries, Inc. v. McClure, 308 N.C. 393, 404, 302 S.E.2d 754, 761 (1983).
The focus in cases such as the one now under consideration, however, is not only whether plaintiff has sustained irreparable injury, but, more important, whether the issuance of the injunction is necessary for the protection of plaintiffs rights during the course of litigation; that is, whether plaintiff has an adequate remedy at law.
Id. at 406, 302 S.E.2d at 762.
It is well established in North Carolina that injunctive relief will be granted only when irreparable injury is both real and immediate. Telephone Co. v. Plastics, Inc., 287 N.C. 232, 214 S.E.2d 49 (1975); Membership Corp. v. Light Co., 256 N.C. 56, 122 S.E.2d 761 (1961). “It is a basic principle of contract law that one factor used in determining the adequacy of a remedy at law for money damages is the difficulty and uncertainty in determining the amount of damages to be awarded for defendant’s breach.” A.E.P. Industries, 308 N.C. at 406-07, 302 S.E.2d at 762. “Specifically, the court must decide whether the remedy sought by the plaintiff is the most appropriate for preserving and protecting its rights or whether there is an adequate remedy at law.” Id. at 406, 302 S.E.2d at 762.
A preliminary injunction may not issue unless the movant carries the burden of persuasion as to each of the prerequisites. E.g., Pruitt v. Williams, 288 N.C. 368, 218 S.E.2d 348 (1975). Once this burden is carried, it still remains in the court’s discretion whether to grant the motion for a preliminary injunction. Id. As Justice Ervin stated in Huskins v. Hospital, 238 N.C. 357, 360, 78 S.E.2d 116, 119-20 (1953):
The hearing judge does not issue an interlocutory injunction as a matter of course merely because the plaintiff avowedly bases his application for the writ on a recognized equitable ground. While equity does not permit the judge who hears the application to *18decide the cause on the merits, it does require him to exercise a sound discretion in determining whether an interlocutory injunction should be granted or refused.
“One who seeks equity must do equity.” Creech v. Melnik, 347 N.C. 520, 529, 495 S.E.2d 907, 913 (1998). Plaintiff has alleged and must show entitlement to equitable relief. Defendants have alleged and it is their burden to prove their equitable defenses. Defendants’ allegations of fraud and unclean hands against plaintiff raise a genuine issue of plaintiffs entitlement to equitable relief. These allegations were never addressed by the trial court. The majority’s opinion does not address them here.
The trial court held the contract to be invalid, against public policy, and unenforceable and denied injunctive relief on those grounds. The trial court never reached the issue of plaintiff’s eligibility for an injunction under a valid contract nor defendant’s equitable defenses. There is insufficient evidence in the record before us to determine whether equity warrants the issuance of an injunction. “[T]he trial judge is in the best position to exercise this discretion. He hears the evidence, observes the witnesses, considers the arguments of counsel, and weighs and balances the equities.” A.E.P. Industries, 308 N.C. at 419, 302 S.E.2d at 769 (Justice Martin dissenting, joined by Justices Copeland and Exum). As the record on this issue is silent and the trial court has not been given the opportunity to exercise this discretion, I would remand for the trial court to hold a hearing on the issuance of an injunction. The granting of an injunction by the majority’s opinion requires the parties to return to the trial court to determine the nature and extent of the injunction granted. The parties must return to the trial court, in any event, since the issue of damages was specifically reserved.
Judicial restraint and judicial economy require that the appropriate remedy be fashioned in accordance with both Rule 65(d) and all other equitable considerations. I would remand this case to the trial court to hold a hearing, review the evidence in light of the alleged defenses, and determine whether injunctive relief is warranted. I respectfully dissent.