¶15 Section 217 of Title 15 of the Oklahoma statutes provides that [e]very contract by which any one is restrained from exercising a lawful profession, trade or business of any kind is void. However, § 218 provides a statutory exception specifically allowing parties to enter into a non-compete agreement when selling the goodwill of a business . Section 218 states:
One who sells the goodwill of a business may agree with the buyer to refrain from carrying on a similar business within a specified county and any county or counties contiguous thereto, or a specified city or town or any part thereof, so long as the buyer, or any person deriving title to the goodwill from him carries on a like business therein. Provided, that any such agreement which is otherwise lawful but which exceeds the territorial limitations specified by this section may be deemed valid, but only within the county comprising the primary place of the conduct of the subject business and within any counties contiguous thereto.
¶16 Section 218 has been in effect since statehood and has remained largely unchanged since that time. This Court has said that the purpose of this statute is to allow the parties to the transfer of a going business to mutually agree, as a part of the value of the business transferred, that the transferee will be protected from his transferor who might use his previously acquired experience, contacts and expertise to promote his own interests in the same field of business in competition with his transferee. Farren v. Autoviable Servs. Inc., 1973 OK 4, ¶ 5, 508 P.2d 646, 648. This Court has held that [i]n Oklahoma restraints of trade are permitted in connection with the sale of business, trade, or professional practice, the permissible limits being fixed by statutes which declare such agreements void only as to an excess of time or space.... Wesley v. Chandler, 1931 OK 477, ¶ 0, 152 Okla. 22, 3 P.2d 720, 720. We have consistently upheld non-compete agreements to protect business goodwill pursuant to § 218.
¶17 In the case before us, neither party disputes that the non-compete was included in the Agreement to protect the businesss goodwill. Nor is there any doubt that the non-compete, as written, applied to the operations at Park Hill. The only concern then is that the non-compete prevents the Berrys from engaging in a competing business anywhere in the United States-as opposed to a specified county and any county or counties contiguous thereto, or a specified city or town or any part thereof. However, § 218 explicitly provides that boundaries which exceed[ ] the territorial limitations do not render the covenant invalid. Rather, we limit enforcement of the covenant to those areas authorized by the statute. In this case, Tri-B Nursery, one of the nurseries purchased in the Agreement, is in the same county as Park Hill (Cherokee County). Therefore, limiting the enforcement of the non-compete to its permitted extent would still encompass operations at Park Hill, and the non-compete would be enforceable under Oklahoma law.
¶18 Thus, we conclude that enforcement of the non-compete under Texas law does not violate Oklahoma public policy in this case. We need not address whether enforcement of the non-solicit under Texas law violates Oklahoma public policy because the non-solicit was intended to be ancillary to and complement the [n]on-[c]ompete[ ], and the non-compete is enforceable. As we discuss in detail below, the Berrys breached the non-compete, and because the non-solicit was less restrictive than the non-compete, any breach of the non-solicit was also a breach of the non-compete. Accordingly, we affirm the trial courts decision to enforce the parties Texas choice-of-law provision.
Breach of the Non-Compete
¶19 After hearing five days of testimony, the trial court found the Berrys breached the covenants. In a non-jury trial the courts findings are entitled to the same weight and consideration that would be given to a jurys verdict. Soldan v. Stone Video, 1999 OK 66, ¶ 6, 988 P.2d 1268, 1269. Because the trial court is in the best position to evaluate the demeanor of the witnesses and to gauge the credibility of the evidence, we will defer to the trial court as to the conclusions it reaches concerning those witnesses and that evidence. Mueggenborg v. Walling, 1992 OK 121, ¶ 7, 836 P.2d 112, 114. On appeal, the trial courts findings will not be disturbed if there is any competent evidence to support them. Upon review, we conclude the trial court correctly found the Berrys breached the non-compete.
¶20 As mentioned above, after Burls resignation from BFN, BFN senior executives met with him on February 21, 2014, to discuss his exit from the company. On that same day , after meeting with BFN executives, Burl was contacted by Wal-Mart, BFNs third largest customer, about selling trees and shrubs, through Park Hill, for a Wal-Mart promotion for which BFN was supposed to be the supplier . Burl met with Wal-Mart buyers at Park Hill less than a week later wherein Wal-Mart purchased more than 250,000 trees and shrubs from Park Hill for its promotion for almost $2 million. The trees and shrubs sold to Wal-Mart that day had previously been offered by Park Hill to BFN to help fulfill its obligation to Wal-Mart for that promotion. In fact, the record indicates that on the same day Burl met with Wal-Mart buyers at Park Hill, Burl received a text message from someone at BFN asking if BFN needed to put in a purchase order with Park Hill to hold all the shrubs, roses and other things they usually get from Parkhill, indicating that had Burl not sold the Park Hill inventory to Wal-Mart for its tree and shrub promotion, BFN would have purchased the inventory and remained the supplier for that promotion.
¶21 After Wal-Mart purchased the trees and shrubs for that particular promotion, Burl then continued to sell to Wal-Mart. In an email on March 4, 2014, from Burl to Rob Cowgur, Wal-Marts head buyer, Burl told Mr. Cowgur: On other product for the rest of the spring, there are still some items out there that I can tie up for you and bring it into mix with what we have at Parkhill[.] [W]e dont plan on shipping BFN anymore product so we can ship you all of that product as well. Park Hills sales to Wal-Mart approached $9 million dollars in 2014 and $12 million dollars in 2015. The record is clear that upon Burls departure from BFN, Park Hill, while still owned by the Berrys, immediately began competing with BFN for Wal-Marts business.
¶22 After Burls resignation from BFN, Park Hill also began selling directly to Home Depot, which was BFNs second largest customer. On Burls last day at BFN, January 31, 2014, Park Hills sales manager, Brett Jones, emailed Home Depots buyer, Rick Pappas, attaching a Park Hill Plants quote for Home Depot to the email: I quoted the items that we discussed and items that I thought you might be interested in. I even put a column in for what I would suggest as the retail and calculated what this would yield for a beginning margin. ... Mr. Pappas responded: Brett, I am good with all of the items listed for the program. We would need to get pricing set up and your PBS vendor number as the next steps. Mr. Pappas testified that the program referred to in the email was Home Depots HGTV program, a program that BFN had been selling to Home Depot until Burls departure. Mr. Pappas also testified that setting up a PBS vendor number allowed Park Hill to sell directly to Home Depot.
¶23 In an email from Mr. Jones to Mr. Pappas on May 5, 2014, Mr. Jones specifically proposed to sell Home Depot clematises as part of Home Depots HGTV program. Home Depot accepted the proposal. At his deposition, Mr. Pappas was asked whether this was yet another example of the Berrys, through Park Hill, seeking business from Home Depot.
Mr. Pappas stated: Yes, it was an e-mail to do business with [us]. Regarding a June 17, 2014, email between Mr. Jones and Mr. Pappas, Mr. Pappas testified:
Q: And your email to Jones reads, [t]hese are the heavy-hitters to ship this week. You can build larger orders around the top six-six stores listed here. Did I read that correctly?
A: Correct.
Q: Can you tell us what youre referring to?
A: My highest volume stores on this list.
Q: And did BFN sell any of the stores that are listed in your June 17 2014 e-mail?
A: Yes.
Q: Would it be fair to say that both BFN and Park Hill were selling plants to those same stores?
A: Yes.
Park Hills sales to Home Depot in 2014 were approximately $1.4 million dollars and $2.5 million in 2015. The record is clear that upon Burls departure from BFN, Park Hill, while still owned by the Berrys, immediately began competing with BFN for Home Depots business. The trial courts finding that the Berrys violated the non-compete is supported by competent evidence and is affirmed.
Injunctive Relief
¶24 The trial court issued Findings of Fact and Conclusions of Law on August 19, 2015, wherein the court concluded BFN was entitled to permanent injunctive relief pursuant to 12 O.S. 2011 § 1381. The trial court also concluded BFN was entitled to an equitable extension of the Covenants through June 7, 2017 . However, on September 4, 2015, before the Final Journal Entry of Judgment was filed, BFN sought and was granted a Temporary Restraining Order against the Berrys for their continued breach of the covenants after the entry of Findings of Facts and Conclusions of Law. The TRO Application alleged that after the trial court entered its Findings of Facts and Conclusions of Law on August 19, 2015, Park Hill accelerated its sales to certain retailers to sell as many plants as possible before the final judgment was entered and hosted Home Depots plant buyers at its nursery on August 25, 2015, to garner additional Home Depot business. On October 15, 2015, the Final Journal Entry of Judgment was filed. Because of the Berrys violation of the courts Findings of Facts and Conclusions of Law, the court again extended the duration of the covenants and enjoined the Berrys until August 20, 2017 , from owning a wholesale nursery that sold to or solicited business from any national or regional retailer, including Wal-Mart and Home Depot.
¶25 Matters involving the grant or denial of injunctive relief are of equitable concern. Dowell v. Pletcher, 2013 OK 50, ¶ 5, 304 P.3d 457, 460. A court sitting in equity exercise[s] discretionary power, and the granting of an injunction rests in the sound discretion of the court to be exercised in accordance with equitable principles and in light of all circumstances. Id. ¶ 6, 304 P.3d at 460. However, an [i]njunction is an extraordinary remedy that should not be lightly granted, id., and [e]ntitlement to injunctive relief must be established in the trial court by clear and convincing evidence.... In reviewing the matter, we will consider all of the evidence on appeal, but the trial courts decision issuing or refusing to issue an injunction will not be disturbed on appeal unless the lower court has abused its discretion or its decision is clearly against the weight of the evidence. Scott v. Okla. Secondary Sch. Activities Assn, 2013 OK 84, ¶ 16, 313 P.3d 891, 896.
¶26 The trial court found that BFN had proven by clear and convincing evidence that it was entitled to injunctive relief. We have reviewed the entire record in this case, and we find the trial courts determination that BFN was entitled to injunctive relief is supported by the evidence. We affirm this portion of the courts order. However, we find no Oklahoma case, and the parties cite to none, wherein this Court has extended the duration of a restrictive covenant beyond the contractually specified timeframe as a remedy for violation of that covenant.
¶27 In Brown v. Stough, 1956 OK 3, 292 P.2d 176, this Court upheld a provision within a medical clinic partnership agreement that prohibited a partner who voluntarily withdrew from the partnership from practicing medicine for a period of two years within the county in which the medical clinic was located. On appeal, the plaintiffs asked the Court to fix the time that the injunction is to commence for its duration of two years as the time the mandate is spread of record . Id., ¶ 19, 292 P.2d at 181 (emphasis added). The Court specifically declined to extend the injunction beyond the contractually specified time reasoning that the partnership agreement plainly provide[d] that a member withdrawing shall not practice medicine for a period of two years from the date of his withdrawal , and that the plaintiffs sought injunctive relief in accordance with the provisions of the contract. Id. The Court concluded that the plaintiffs could not obtain additional or greater relief than that prayed for in their petition or authorized by the contract sued upon . Id. (emphasis added).
¶28 In this case, the parties Agreement plainly relieved the Berrys from the covenants upon the expiration of the five-year term, which all parties agree was December 7, 2015. Although the Agreement specifically allowed for injunctive relief as a remedy for any breach, nothing in the Agreement suggests either party contemplated or agreed to an extension of the covenants beyond December 7, 2015, as part of any injunctive relief that might issue. Thus, we reverse that portion of the trial courts judgment extending the duration of the covenants for an additional twenty months through August 20, 2017.
Damages
¶29 BFN also sought damages for the Berrys breach of the covenants, specifically for lost profits on the Home Depot and Wal-Mart accounts for the years 2014, 2015, 2016, 2017, and 2018 (2014-2018). BFNs expert calculated such lost profits at $8,212,404.00. The Berrys offered no evidence, by way of expert testimony or otherwise, to dispute BFNs calculation of such damages. Rather, the Berrys sole argument at trial and on appeal is that the Berrys
breach was not the cause of BFNs damages with regard to sales to Wal-Mart and Home Depot. The trial courts only finding on damages was: [B]FN failed to establish it would have continued to sell to Wal-Mart and Home Depot but for the interference of the Berrys or Park Hill. Therefore, no monetary damages are awarded. For the reasons set forth below, we reverse the trial courts finding that BFN was not entitled to monetary damages for the Berrys breach.
¶30 Much was made at trial about the unique purchasing cycle of the nursery industry. At trial, Burl explained the nursery planting cycle as follows:
[W]e go through the planting process. We have to plant-we have to plant in the spring of the year our bare root trees. Youve got to typically plant the bare root trees in January, February, and March for the whole-for your fall business or for the next spring. So, youve got to plan it out. ...
Then, you go to the line review process. ... The line review process is where you go in to basically see a vendor, i.e., be it Wal-Mart or Lowes. ... Typically it happens in July or August. ... You go in, and you present your prices. You present the products that you have to sell for the next year. And you basically have an idea of the area that youd like to ship thats compatible to the products you have. And you usually go over for the day, and you make that presentation. And then typically, sometimes it was as late as December before you would hear back from them. ... And that would be the first time that you could take those areas, arrive and write some preliminary orders and know what inventory youre really going to need. ...
The next step would be the shipments. Send them back to Wal-Mart. Get POs. Get hard POs on them. And plan to ship them in the spring or at the next-at the determined proper time, you know, the next spring.
¶31 Wal-Marts head buyer, Mr. Cowgur, also testified that particularly for a company the size of Wal-Mart, horticulture inventory has to be planned out years in advance to ensure supply is available in the large quantities needed. When asked why Wal-Mart continued to do business with BFN after the March 2014 tree and shrub promotion, Mr. Cowgur responded:
A: We didnt have a choice. We-BFN is a big company, and they were in our top ten as far as volume goes. And when you look at what it takes to plan out the horticulture business specifically in trees and shrubs, long lead times; three, four, five, six, sometimes seven years on product . And quite frankly, you know, so many folks have closed up shop. We-we needed product to be able to sell to our customer. So not that we wanted to, but we did. ... Im just saying there was no other product available anywhere else, so we didnt have a choice. Whether we wanted to or not, thats irrelevant .
¶32 With regard to the Home Depot account, Burl testified at trial that he and Mr. Pappas had previously discussed an order of more than twenty thousand hydrangeas that were originally supposed to have been shipped to Home Depot in the spring of 2014 through BFN . When asked if prior to his departure from BFN, whether he anticipated that that product would be shipped to Home Depot under BFN[,] Burl responded, [p]rior to my leaving, yes, that was our plan. In addition, when asked whether Park Hill anticipated selling inventory already in the ground to BFN for the spring 2014 season so that BFN could then sell it to Wal-Mart, Burl replied, [n]ot only Wal-Mart. Lowes ... Home Depot, any accounts.
¶33 A claim for lost profits need not be proven with absolute certainty, and [i]n essence, what a [party] must show for the recovery of lost profits is sufficient certainty that reasonable minds might believe from a preponderance of the evidence that such damages were actually suffered . Upon Burls departure from BFN on January 31, 2014, Park Hill immediately began selling inventory directly to Wal-Mart and Home Depot-inventory that Burl specifically testified was to be sold to BFN for the spring 2014 season so BFN could sell to Wal-Mart and Home Depot. The question then is not whether the Berrys breach caused BFN damages-it most certainly did-the question, rather, is what are BFNs damages? On remand the trial court shall determine BFNs damages for lost profits on the Home Depot and Wal-Mart accounts. Although a non-breaching party may not receive more in damages than he might or could have gained from full performance of the contract, we make no determination whether BFN is entitled to damages beyond December 7, 2015, and leave that question to the trial court to determine on remand.
Tortious Interference
¶34 BFN also alleged that Park Hill tortiously interfered with BFNs Agreement with the Berrys. BFN argues that [b]ecause the sales to Wal-Mart and Home Depot in violation of the Covenants were all made by Park Hill, the damages from the Berrys breach of the Covenants and Park Hills interference with them are the same. The trial court found Park Hill tortiously interfered with the Covenants because Park Hill intentionally and knowingly participated in the violation. However, the trial court found BFN failed to prove monetary damages. The Berrys made no claim of error on appeal with regard to the courts finding that Park Hill tortiously interfered with the Agreement. Thus, the trial courts finding remains undisturbed in that regard, and the only issue on appeal is whether the trial court correctly concluded BFN failed to prove monetary damages.
¶35 Because we are remanding the case to the trial court to determine BFNs damages for the Berrys breach, we also remand the case for the trial court to reconsider damages with regard to BFNs tortious interference claim against Park Hill. Although BFN agrees that damages from the Berrys breach and Park Hills interference are the same, BFN is entitled to reassert its claim for punitive damages against Park Hill on remand upon the trial courts determination of BFNs damages for lost profits on the Home Depot and Wal-Mart accounts. In addition, on remand, Park Hill is entitled to a reduction of $439,000.00 on any judgment against it as the trial court correctly concluded BFN owed Park Hill $439,000.00 on an open account.
Attorneys Fees
¶36 The Final Journal Entry of Judgment also concluded that BFN, as the prevailing party, was entitled to reasonable attorneys fees with the amount [to] be determined by separate application. Although the trial court did not specify whether it was awarding attorneys fees to BFN under Texas or Oklahoma law, BFN sought attorneys fees pursuant to Section 38.001(8) of the Texas Civil Practice & Remedies Code. The Berrys appealed the trial courts finding, asserting that the trial court erred in ruling BFN is entitled to attorneys fees and costs ... under § 38.001(8) of the Texas Civil Practice and Remedies Code because, among other reasons, the court erred procedurally in not allowing the issue to be fully briefed by both parties. Because the trial court did not set an amount for attorneys fees in the Final Journal Entry of Judgment, that portion of the judgment is an interlocutory ruling. An order granting attorneys fees, but not determining the amount is not a final judgment, and appeal of this issue is premature. Because the trial courts ruling is not a final order in this regard, either party may ask the trial court to reconsider the ruling. Liberty Bank & Trust Co. of Okla. City, N.A. v. Rogalin, 1996 OK 10, ¶ 14, 912 P.2d 836, 839 (stating that an interlocutory order is subject to trial court modification). In that same vein, because the trial courts ruling on the issue remains open to modification, any ruling regarding attorneys fees, is subject to subsequent examination on timely appeal by either party. Id.
Conclusion
¶37 The trial court correctly enforced the parties bargained-for Texas choice-of-law provision, and under Texas law, the non-compete is valid and enforceable. The trial court also correctly concluded that the Berrys breached the non-compete upon Burls departure from BFN on January 31, 2014. Although the trial court correctly found BFN was entitled to injunctive relief, we reverse that portion of the trial courts judgment extending the duration of the restrictive covenants for an additional twenty months through August 20, 2017. We also reverse that portion of the trial courts judgment finding BFN suffered no damages from the Berrys breach or from Park Hills tortious interference. We affirm the trial courts finding that BFN owed Park Hill $439,000.00 on an open account. That portion of the trial courts order awarding attorneys fees to BFN is not a final judgment, and appeal of that issue is premature. The case is remanded to the trial court for further proceedings consistent with this opinion.
TRIAL COURTS ORDER AFFIRMED IN PART AND REVERSED IN PART; CAUSE REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH TODAYS PRONOUNCEMENT
¶38 Combs, C.J., Gurich, V.C.J., Kauger, Winchester, Reif and Wyrick, JJ., concur;
¶39 Colbert, J., concurs in result;
¶40 Edmondson, J., not participating.
15 O.S. 2011 § 217. This Court has said that [s]ection 217 prohibits only unreasonable constraints on the exercise of a lawful profession, trade or business. Cardiovascular Surgical Specialists, Corp. v. Mammana, 2002 OK 27, ¶ 14, 61 P.3d 210, 213 (citing Bayly, Martin & Fay, Inc. v. Pickard, 1989 OK 122, ¶ 11, 780 P.2d 1168, 1172 ). To cure an overly broad and thus unreasonable restraint of trade, an Oklahoma court may impose reasonable limitations concerning the activities embraced, time, or geographic limitation but it will refuse to supply material terms of the contract. Id.
15 O.S. 2011 § 218. This Court has defined goodwill as: [T]he custom or patronage of any established trade or business; the benefit or advantage of having established a business and secured its patronage by the public. The good will value of any business is the value that results from the probability that old customers will continue to trade with an established concern. Freeling v. Wood, 1961 OK 113, ¶ 12, 361 P.2d 1061, 1063 (internal citations omitted).
Sections 217 and 218were adopted word for word from the Dakota territories. Key v. Perkins, 1935 OK 142, ¶ 9, 173 Okla. 99, 46 P.2d 530, 531.
See Farren, 1973 OK 4, 508 P.2d 646 (enforcing covenant not to compete where owner of vending machine operation and food service company agreed not to compete in such business in the same county for one year after the closing of a corporate merger which included the sale of goodwill of the business); Griffin v. Hunt, 1954 OK 87, 268 P.2d 874 (enforcing covenant not to compete where veterinarian who sold his practice, including the goodwill of the business, agreed not to operate a veterinary facility in the same county for a specified time); Clare v. Palmer, 1949 OK 8, 201 Okla. 186, 203 P.2d 426 (enforcing covenant not to compete where the seller of a drug store and the goodwill of such business agreed not to compete in the same town as the buyer so long as the buyer continued the operation of a similar business in the town); Hartman v. Everett, 1932 OK 460, 158 Okla. 29, 12 P.2d 543 (enforcing covenant not to compete where the seller of stock of a publishing company agreed not to edit, publish, or manage a fox, wolf or hound magazine in the same county as the buyer for a period of five years).
15 O.S. 2011 § 215.
Record on Appeal at 770.
Nichols v. Nichols, 2009 OK 43, ¶ 10 & n.14, 222 P.3d 1049, 1054 & n.14 (An appellate court has a common-law duty to affirm a trial judges decision if it can be supported by any applicable legal theory.).
Soldan, 1999 OK 66, ¶ 6, 988 P.2d at 1269. Because BFN sought damages only with regard to the Home Depot and Wal-Mart accounts, we need not address whether the Berrys breached the non-compete with regard to other BFN customers including Lowes and K-Mart.
Record on Appeal at 1426. This much discussed tree and shrub promotion for Wal-Mart was set to take place in March of 2014. The undisputed evidence at trial revealed that BFN had previously been awarded the promotion from Wal-Mart and had planned to supply the promotion with trees and shrubs already in the ground at Park Hill.
Record on Appeal, Non-Jury Trial Proceedings, Defs. Ex. 117.
The Berrys spent much of their time at trial presenting witnesses who testified that BFN had discontinued its relationship with Wal-Mart when Park Hill began selling to Wal-Mart in March of 2014. However, the record makes clear that BFN had not ended its relationship with Wal-Mart as evidenced by Wal-Marts purchase of millions of dollars of inventory from BFN after March of 2014. Mr. Cowgur testified that the dollar amount of plants Wal-Mart purchased from BFN after March of 2014 was between 10 and 15 million dollars. Record on Appeal at 1446. In addition, the record reflects that BFN executives were in daily communication with Wal-Mart buyers attempting to reach an agreement to negotiate pricing with Wal-Mart after the tree and shrub promotion. Record on Appeal at 1465; Record on Appeal, Non-Jury Trial Proceedings, Defs. Exs. 124-125, 134-137. Regardless, such evidence is irrelevant to the determination of whether the Berrys violated the non-compete.
Record on Appeal at 1641.
Id. at 1639.
Id. at 1602.
Mr. Pappas testified that Park Hill did not have a vendor number until after Burl left BFN and that under Home Depots vendor system, Home Depot must assign a vendor a number for the vendor to sell plants to Home Depot. Id. at 1598, 1603.
Id. at 1602.
Id. at 1604.
Although Texas law governs the validity and enforceability of the non-compete in this case, the remedy available to enforce such contractual provision is determined by the law of the forum. Consol. Grain & Barge Co. v. Structural Sys. Inc., 2009 OK 14, n.6, 212 P.3d 1168, 1171 n.6 ; see also Clark v. First Natl Bank of Marseilles, Ill., 1916 OK 404, ¶ 9, 59 Okla. 2, 157 P. 96, 98 ([M]atters respecting the remedy depend upon the law of the place where the remedy is sought to be enforced.).
Record on Appeal at 774 (emphasis added).
The trial courts judgment with regard to injunctive relief provides:
Bob Berry and Burl Berry, directly or indirectly, from the date of this Final Journal Entry of Judgment in this action through August 20, 2017, be and hereby are enjoined and restrained from (1) owning or being an equity owner (other than as an equity holder of less than 2% percent of the issued and outstanding shares of a publicly traded company) within the United States of America, in any business activity or enterprise, including but not limited to, Park Hill, that is a wholesale nursery that sells trees, shrubs, rose bushes, and/or perennials to any national or regional retailer, including, without limitation, Costco, Home Depot, K-Mart, Kroger, Lowes, Sams Club, Wal-Mart, Meijer, Shopko, or Rural King, for resale to consumers, and (2) either directly or indirectly, for their own benefit or the benefit of any other person or entity, including, but not limited to, Park Hill, from soliciting, attempting to solicit, calling on, or diverting or attempting to divert from [BFN], the customers identified on Schedule 3.18(a) to the APA, a copy of which is attached hereto as Exhibit A. Bob Berry and Burl Berry are not enjoined from having an ownership in Park Hill, so long as Park Hill refrains from selling trees, shrubs, rose bushes and/or perennials to any national or regional retailer, including, without limitation, Costco, Home Depot, K-Mart, Kroger, Lowes, Sams Club, Wal-Mart, Meijer, Shopko, or Rural King, for resale to consumers. The Court shall have continuing jurisdiction to enforce the injunctive relief granted herein.
Id. at 1067.
House of Realty, Inc. v. City of Midwest City, 2004 OK 97, ¶ 11, 109 P.3d 314, 318 (internal quotation marks omitted).
Record on Appeal at 772.
Record on Appeal, Non-Jury Trial Proceedings, Defs. Ex. 201.
Record on Appeal at 773.
Record on Appeal, Non-Jury Trial Proceedings at 163-166.
Record on Appeal at 1355.
Id. at 1355 (emphasis added).
Record on Appeal, Non-Jury Trial Proceedings at 403.
Id. at 384.
Florafax Intl, Inc. v. GTE Market Res. Inc., 1997 OK 7, ¶ 42, 933 P.2d 282, 296 (emphasis added). In Florafax this Court addressed the standard for assessment of damages for lost profits in a breach of contract case, and specifically discussed lost profits from a third-party collateral contract. In that case, Florafax International, Inc. sued GTE Market Resources for breaching a contract that required GTE to provide telecommunication and telemarketing services to Florafax. However, part of the damages sought by Florafax was profits lost under a collateral contract Florafax had with a third party that was canceled because of GTEs breach of its contract with Florafax. The jury determined that GTE breached its contract with Florafax, and in addition to other damages, awarded Florafax damages for lost profits Florafax would have earned under its collateral contract with the third party.
This Court affirmed the jurys award and found that an award in the form of lost profits is generally considered a common measure of damages for breach of contract, [and] frequently represents fulfillment of the non-breaching partys expectation interest.... [I]t often closely approximates the goal of placing the innocent party in the same position as if the contract had been fully performed. Id., ¶ 26, 933 P.2d at 292. The Court set forth the following standard for assessing damages for lost profits:
[L]oss of future or anticipated profit-i.e. loss of expected monetary gain-is recoverable in a breach of contract action: 1) if the loss is within the contemplation of the parties at the time the contract was made, 2) if the loss flows directly or proximately from the breach-i.e. if the loss can be said to have been caused by the breach-and 3) if the loss is capable of reasonably accurate measurement or estimate.
Id.
Id., ¶¶ 34-39, 933 P.2d at 295.
Oklahoma recognizes a tortious interference claim with a contractual or business relationship if the plaintiff can prove (1) the interference was with an existing contractual or business right; (2) such interference was malicious and wrongful; (3) the interference was neither justified, privileged nor excusable; and (4) the interference proximately caused damage. Wilspec Techs., Inc. v. DunAn Holding Grp., Co., 2009 OK 12, ¶ 15, 204 P.3d 69, 74.
Combined Answer Brief and Brief-in-Chief of BFN at 38 n.30 (emphasis added).
Record on Appeal at 775.
Id. at 769-70.
Id. at 775.
In Wilspec, we said that a tortious interference claim is viable only if the interferor is not a party to the contract or business relationship. 2009 OK 12, ¶ 15, 204 P.3d at 74. The Berrys did not argue at trial or on appeal that Park Hill was a party to the contract.
[P]unitive damages are not recoverable solely for breach of contract obligations [but] when a breach of obligations arises from tortious conduct ... punitive damages may be recoverable. Wilspec, 2009 OK 12, ¶ 17, 204 P.3d at 76. In addition to proving the elements of a tort, the plaintiff seeking punitive damages for tortious interference with a contract obligation must prove that the defendant acted either recklessly, intentionally, or maliciously by clear and convincing evidence. Id., ¶ 18, 204 P.3d at 76.
Park Hill alleged in its Petition that BFN owed Park Hill $450,000.00 for failure to pay for products supplied by Park Hill to BFN. BFN asserted setoff as an affirmative defense to Park Hills open-account claim, alleging that Park Hill owed $48,285.00 to BFN and that any judgment entered in Park Hills favor should be set off in this amount. On this issue, the trial court found that BFN owed Park Hill $439,000.00 at the time of trial and that BFN had failed to prove its setoff claim. Record on Appeal at 773.
Although exhibit 177 from the non-jury trial indicates BFN may be entitled to setoff in amount of $48,285.00, the exhibit is not dated. Jack Waterstreet, the BFN executive who testified to the authenticity of the document, testified that the document was an excerpt of the accounts receivable ledger, but Mr. Waterstreet likewise did not provide a date for the document, just that it was made at or near the time of the act. Record on Appeal, Non-Jury Trial Proceedings at 1075. The ledger includes invoices for Park Hill Plants and Park Hill Plants & Trees ranging from August 29, 2013, to June 29, 2014. Other exhibits in the record relied on by BFN, including Exhibit 159 at page 18, do not support BFNs claim for setoff. Page 18 of Exhibit 159 is a chart showing YTD Cost of Sales Update/Inventory Bridge, and does not reflect any amount owed by Park Hill to BFN. Park Hill did not address BFNs setoff claim in its Combined Reply and Answer Brief on appeal. Regardless, the evidence relied on by BFN is incomplete, at best, with regard to its setoff claim. Thus, we defer to the trial courts finding that BFN failed to prove setoff. The courts judgment is affirmed in this regard.
Record on Appeal at 1068-69.
Compare Veiser v. Armstrong, 1984 OK 61, n.6, 688 P.2d 796, 799 n.6 (stating that in a conflict-of-law analysis matters of procedure are governed by the law of the forum), with Boyd Rosene and Assocs., Inc. v. Kansas Mun. Gas Agency, 174 F.3d 1115, 1118-25 (10th Cir. 1999) (concluding that under Oklahoma law, attorneys fees would be considered substantive in a choice-of-law analysis, and thus, the states law that governs the substantive issues in the case also applies to decide whether attorneys fees are recoverable).
Petition in Error, Ex. C. We note that if Texas law applies, the parties were not given a full opportunity to address whether that states law allows attorneys fees to employers who seek to enforce restrictive covenants against employees. The issue remains unsettled under Texas law and deserves closer examination by both the trial court and the parties.
See Keel v. Wright, 1995 OK 18, 890 P.2d 1351 ; see also Beavers v. Byers, 2010 OK CIV APP 79, ¶ 8, 239 P.3d 484, 487 (A trial court order determining only a partys entitlement to attorney fees and costs does not constitute a final order.); City of Norman v. Am. Fedn of State, Cty. & Mun. Emps., 2006 OK CIV APP 137, ¶ 3, 146 P.3d 872, 872 ([T]he resolution of the issue of entitlement [to attorneys fees] without a determination as to amount does not constitute a final order, and this appeal must be dismissed as premature.).