Hilb, Rogal & Hamilton Company of Atlanta, Inc. v. William Hugh Holley

The Court affirmed the trial court's grant of summary judgment to the defendant on his former employer's claim that he breached his restrictive covenants.

The plaintiff argued that the covenants part of a sale of business and should not have been subject to strict scrutiny. The Court rejected that argument, noting that the covenant not to compete in the sale document had expired, and that the covenants at issue in this case were different from that covenant and were contained in a separate employment agreement. "This Court has consistently held that when parties execute separate contracts for the seller's sale of the business and the seller's subsequent employment and each contract contains different restrictive covenants, the restrictive covenants in the employment contract are subject to strict scrutiny. We note that any statements to the contrary found in Annis v. Tomberlin & Shelnutt Assoc., are nonbinding dicta." (footnotes omitted).

Since the covenant not to solicit precluded the defendant from “accepting an entreaty” from known or prospective customers, the Court found that it was overly broad and unenforceable, and that this rendered the non-compete and non-solicit covenants unenforceable.