Baird and Warner Residential Sales v. Mazzone

SUPREME COURT CASES

Laws-info.com » Cases » Illinois » 1st District Appellate » 2008 » Baird and Warner Residential Sales v. Mazzone

State: Illinois

Court: 1st District Appellate

Docket No: 1-07-2179 Rel

Case Date: 08/15/2008

Preview:SIXTH DIVISION August 15, 2008 No. 1-07-2179 BAIRD AND WARNER RESIDENTIAL SALES, INC., Plaintiff-Appellant, v. PATRICIA MAZZONE and MIDWEST REALTY VENTURES, LLC, d/b/a Prudential Preferred Properties, Defendants-Appellees. JUSTICE O'MALLEY delivered the opinion of the court: Plaintiff Baird & Warner Residential Sales, Inc. (Baird & Warner), filed a three-count complaint against defendants Patricia Mazzone (Mazzone) and Midwest Realty Ventures, LLC, d/b/a Prudential Preferred Properties (Prudential), alleging breach of contract against Mazzone, tortious interference with contract against Prudential, and tortious interference with prospective economic advantage against both defendants. Defendants filed a motion to dismiss under section 2-615 of the Code of Civil Procedure (Code) (735 ILCS 5/2-615 (West 2006)), which the trial court granted in part. Plaintiff petitioned for leave to appeal under Supreme Court Rule 307(a)(1) (188 Ill. 2d R. 307(a)(1)), contending that the trial court erred in: (i) holding the nonsolicitation covenant between Mazzone and plaintiff unenforceable on its face and as a matter of law; and (ii) refusing to modify the covenant in order to make it enforceable. We granted plaintiff's petition, and for the following reasons, we reverse the judgment of the trial court and remand the matter for further proceedings. ) ) ) ) ) ) ) ) ) ) ) Appeal from the Circuit Court of Cook County, Illinois No. 07 CH 11334

The Honorable Andrew Berman and Peter Flynn, Judges Presiding.

No. 1-07-2179 BACKGROUND On April 25, 2007, plaintiff filed a verified complaint for injunctive and other relief against Mazzone and Prudential. Count I of the complaint alleged breach of contract against Mazzone, count II alleged tortious interference with contract against Prudential, and count III charged tortious interference with prospective economic advantage against both defendants. The complaint alleged the following facts. Plaintiff Baird & Warner is an independent real estate broker in Illinois, with 1,700 real estate agents operating out of over 30 offices in the Chicagoland area. Plaintiff's "most valuable asset" is its sales agents, and the recruitment process is very time consuming, taking on average from one to three years after the first contact. The sales agents, however, are independent contractors "who are free to affiliate with whatever broker provides them with the best managerial and administrative support and compensation." In November 1996, plaintiff hired Mazzone as the manager of its Lincoln Park office, which at the time the complaint was filed had 100 sales agents and generated approximately $441 million in annual sales. On April 1, 2006, plaintiff and Mazzone entered into a "Sales Manager Compensation Agreement," which provided in pertinent part as follows (formatting omitted): "This Compensation Agreement is made *** between [plaintiff] (`Company'), and *** Mazzone (`Sales Manager') regarding the Lincoln Park Office. *** Now therefore, *** the parties agree as follows: 1. Sales Office. Company is employing Sales Manager to manage its Lincoln Park office.

2

No. 1-07-2179 *** 5. Non Solicitation Promise. In consideration of Sales Manager's continued employment, Sales Manager agrees that during the time of Sales Manager's employment with Company, and for a period of one (1) year after the termination of Sales Manager's employment, whether voluntary or involuntary, Sales Manager shall not, except on behalf of Company, either directly or indirectly, solicit or accept if offered with or without solicitation, on Sales Manager's own behalf or on behalf of any other person or entity, the services of any person who is a current employee of or Independent Contractor with Company (or was an employee of or Independent Contractor with Company during the six (6) months preceding such solicitation), nor induce or encourage any of Company's current employees or Independent Contractors to terminate employment or an engagement with Company, nor agree to hire any of Company's current employees or Independent Contractors (or any individual who was associated with Company during the six (6) months preceding such hire) into employment or association with Sales Manager or any other person or entity. 6. Severability. If any provision of this Agreement is held to be illegal or unenforceable in whole or in part, such provision or section of provision will be severable and the remaining provisions

3

No. 1-07-2179 and sections will remain in full force and effect." On March 30, 2007, Mazzone resigned from her position as sales manager for plaintiff's Lincoln Park office. Shortly thereafter, she joined Prudential as the managing broker of Prudential's Michigan Avenue office. On April 26, 2007, the day after filing its verified complaint, plaintiff filed a motion for temporary restraining order and preliminary injunction, seeking to enjoin defendants from "decimating [plaintiff's] Lincoln Park office staff of real estate employees and agents." Among other things, plaintiff asked the court to enjoin Mazzone and Prudential for a period of one year from "directly or indirectly soliciting or accepting the services of any person *** who is an employee or agent of [plaintiff]" or who was an employee or agent of plaintiff during the six months preceding Mazzone's resignation from plaintiff. On April 27, 2007, the trial court held a hearing on plaintiff's motion for a temporary restraining order and preliminary injunction, whereby plaintiff explained to the trial court that the relief it was seeking was to "prevent *** Mazzone and Prudential *** from soliciting Baird & Warner's agents or employees or from hiring them. So that what that means is Baird & Warner, what we're asking, that Baird & Warner's agents not be permitted to be hired by *** Mazzone to work under *** Mazzone in that office." After the trial court expressed concern that the requested relief was unreasonably broad, plaintiff explained to the trial court that under the "easiest" case, "Mazzone cannot solicit or hire directly any of Baird & Warner's agents and employees." The trial court subsequently granted Baird & Warner's motion in part, enjoining Mazzone from directly or indirectly soliciting "any person" who was an employee or agent of "Baird & Warner" or who had been an employee or agent during the six months preceding Mazzone's resignation from Baird &

4

No. 1-07-2179 Warner, on behalf of herself or any other entity. The trial court denied the rest of Baird & Warner's motion and ordered discovery to be completed on an expedited basis. On June 1, 2007, defendants filed a motion to dismiss under section 2-615 of the Code, contending that the complaint failed as a matter of law because the nonsolicitation covenant was "unreasonable, overly broad and unenforceable as a matter of law." Defendants argued that Baird & Warner was "in essence, seeking to impose an employment `poison pill' on Mazzone, so that [Baird & Warner] can preclude an employer from hiring any [Baird & Warner] employees or its 1,700 independent contractors if that employer hires one manager from one office

Download Baird and Warner Residential Sales v. Mazzone.pdf