Brief Fact Summary.
Lucht’s Concrete Pumping, Inc. sued Horner for violating a non-compete agreement entered into by Horner when she was an employee of the company.
Synopsis of Rule of Law.
Continuing an at-will employment relationship constitutes sufficient consideration to support a contract.
Horner was hired as an at-will employee for Lucht’s Concrete Pumping, Inc. (Lucht) and signed a non-compete agreement that prevented Horner from soliciting employees and customers from Lucht’s for 12 months after leaving employment with the company. Horner resigned a year later and began working for Everist Materials, LLC (Everist), a competitor of Lucht’s that shared many customers. Lucht sued Horner for breaching the non-compete agreement and Horner filed a motion for summary judgment claiming that there was not sufficient consideration to support the non-compete agreement. The trial court granted summary judgment to Horner and the appellate affirmed. Lucht appealed.
Whether continuing an at-will employment relationship constitutes sufficient consideration to support a contract?
Yes. The judgment of the appellate court is reversed and remanded. Lucht’s agreeing not to terminate Horner in exchange for Horney agreeing not to compete is adequate consideration to support a contract.
Consideration exists where a party foregoes an action that a party is legally entitled to carry out. Lucht’s was entitled to let go Horner at any time, but let go of that right upon introducing the non-compete agreement.