Moye v. Eure , 21 N.C. App. 261 ( 1974 )

204 S.E.2d 221 (1974) 21 N.C. App. 261

E. T. MOYE, t/a Nationwide Press and National Consumers Research Corporation, a North Carolina Corporation
v.
Bobby EURE.

No. 7410DC220.

Court of Appeals of North Carolina.

April 17, 1974. Certiorari Denied June 4, 1974.

L. Philip Covington, Garner, for plaintiff appellee.

Vaughan S. Winborne, Raleigh, for defendant appellant.

Certiorari Denied by Supreme Court June 4, 1974.

BALEY, Judge.

The trial court based the preliminary injunction issued in this case upon the verified complaint filed by the plaintiffs. The defendant maintains that the facts alleged in the complaint even if assumed to be true were insufficient to support a preliminary injunction. We agree and direct that the preliminary injunction be vacated.

The action of the plaintiffs is based on the premise that they are entitled to protection from the defendant who seeks to induce third parties, whether employees or independent contractors, to breach their contract with plaintiffs and enter into contracts with him. North Carolina recognizes liability for unlawful interference with contract. "[A]n action lies against one who, without legal justification, knowingly and intentionally causes or induces one party to a contract to breach that contract and cause damage to the other contracting party." Overall Corp. v. Linen Supply, Inc., 8 N.C.App. 528, 530, 174 S.E.2d 659, 660; accord, Johnson v. Gray, 263 N.C. 507, 139 S.E.2d 551; Childress v. Abeles, 240 N.C. 667, 84 S.E.2d 176; Bryant v. Barber, 237 N.C. 480, 75 S.E.2d 410. In addition, when one induces a third person not to enter into a contract which he would otherwise have entered, the interfering party may under certain circumstances be held liable for interference with contract. Johnson v. Gray, supra.

The fact that plaintiffs and defendant are business competitors does not give defendant any privilege to induce an employee to breach his contract with plaintiff. Overall Corp. v. Linen Supply, Inc., supra; Restatement of Torts, § 768; Prosser, Torts 3d, § 123, at 970. But a competitor of plaintiff does have the privilege to induce an employee not to renew a contract with plaintiff after it has terminated, or not to enter into a contract with plaintiff in the first place. Overall Corp. v. Linen Supply, Inc., supra; Restatement of Torts, § 768; Prosser, Torts 3d, § 124, at 979. This privilege is necessary for the protection of employees. In the absence of a valid contract not to compete, an employee whose contract has expired (or an employee working without a contract) is free to work for whomever he chooses. See Kadis v. Britt, 224 N.C. 154, 29 S.E.2d 543; Comfort Spring Corp. v. Burroughs, 217 N.C. 658, 9 S.E.2d 473. He may work for his previous employer, for a competitor, or for another employer in a different line of business, as he chooses. If an employee has established a reputation for doing good work, so that several employers desire to employ him, he is entitled to reap the benefits of that reputation, by having the various employers compete for his services. Even if the employee has tentatively made up his mind to work for a particular employer, a competitor has the right to come up with a better offer and induce him to change his mind. If the courts were to restrict an employer's right to compete for employees, it would be the employees who would suffer.

As a competitor of Consumers, defendant had the right to persuade Consumers' employees to work for him, so long as he did not induce them to breach any existing contracts. But in the present case, there is no competent evidence that any contracts existed between Consumers and its sales personnel. The complaint, which is all the evidence, does not discuss the terms or extent or nature of any employment contracts or the circumstances under which they were made. The bare allegation in the complaint that named people were "under contract with National Consumers Research" does not constitute competent evidence; it is merely a statement of a legal conclusion which plaintiffs are attempting to establish. Expressions of opinion on a question of law are not admissible in evidence. The statement that "the following people were under contract with National Consumers Research" is no more factual or specific than the statement that "the speed limit at the time and place of the accident was thirty-five miles per hour," which was held inadmissible in Hensley v. Wallen, 257 N.C. 675, 127 S.E.2d 277; or the statement that defendant "had been in the open, notorious and adverse possession of the land in dispute," held inadmissible in Memory v. Wells, 242 N.C. 277, 87 S.E.2d 497; or that a deed "was never delivered," held inadmissible in Ballard v. Ballard, 230 N.C. 629, 55 S.E.2d 316. See 1 Stansbury, N.C. Evidence (Brandis rev.), § 130.

Plaintiffs also contend that in contacting their employees or independent sales personnel defendant would be violating a trade secret or using improperly confidential information which he acquired while working for plaintiff Moye. The alleged confidential information was a list of the sales personnel which was attached to the complaint and is now a part of the public record and accessible to any interested citizen. The injunction would prevent defendant from using information which is freely available to the public generally. Without regard to the public disclosure, however, the list of employees of plaintiffs would not be considered as the type of trade secret which would be protected from exposure by injunction.

The preliminary injunction cannot be sustained on the theory of interference with contract as there was no competent evidence submitted at the hearing of any existing contracts with which defendant could interfere. It cannot be supported as a violation of confidence in the misuse of an alleged trade secret.

The trial court erred in granting a preliminary injunction, and its decision is reversed and the injunction vacated.

Reversed.

CAMPBELL and HEDRICK, JJ., concur.