No. 955 Pittsburgh, 1982 & No. 126 Pittsburgh, 1983, Appeal from Order of the Court of Common Pleas, Civil Division, of Allegheny County at No. G.D. 79-19667, Issue No. 110221.
James C. Larrimer, Pittsburgh, for appellants (at No. 955) and appellees (at No. 126).
Jan C. Swensen, Pittsburgh, for appellant (at No. 126) and appellee (at No. 955).
Cavanaugh, Brosky and Montgomery, JJ.
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The basis of this case is a "franchise agreement" dated August 14, 1974, entered into between Charles Krane and Temporaries, Incorporated (referred in this opinion as T I). The agreement granted an exclusive franchise to Charles Krane to operate a temporary help business in designated
[ 325 Pa. Super. Page 106]
counties in Pennsylvania and Ohio. The agreement which referred to Temporaries, Incorporated as T I and to Charles Krane as "Licensee" stated inter alia:
11. RENEWAL. Provided Licensee is not in default hereunder, Licensee may extend the term of this Agreement for an additional period of five (5) years by giving to TI written notification of its desire to renew at least six (6) months prior to the termination date hereof. Further, provided Licensee is not in default hereunder, Licensee shall have the right to extend the term of this Agreement for additional five (5) year periods without limitation in number; provided, that Licensee shall give written notice to TI of his intention to extend the term at least six (6) months prior to the termination date of each five (5) year extension.
13. EFFECT OF TERMINATION. Upon termination of this Agreement, Licensee agrees to immediately cease to use, by advertising or otherwise, the tradename TEMPORARIES INCORPORATED, or any other trade name, mark or style of TI and not to engage in any business which is competitive with TI or the business previously done by Licensee for a period of one year within the territory of this franchise. Licensee shall immediately return to TI without charge, all forms, advertising matter, manuals, procedures and records furnished by or belonging to TI.
15. CONDITIONS OF TERMINATION. Upon the termination of this Agreement for any cause, the Licensee will not for a period of one year thereafter, directly or indirectly, enter the employment of, or render services to, any other person, partnership, association or corporation engaged in the same or substantially similar business covered by this Agreement in any area which can be reasonably termed competitive to the Licensor or other Licensees; and during such term of one year the Licensee will not within such territory engage in such business on
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his own account, or become interested therein, directly or indirectly, as an individual, partner, stockholder, director, officer, clerk, principal, agent, employee, trustee, or in any relation or capacity whatsoever. Without limiting the generality of the foregoing, the minimum area of a competitive nature hereinbefore referred to shall be that area within a 25 mile radius of the Licensee's place of business, or any place of business conducted by the Licensor or any other Licensee of the Licensor at the time of the termination of this Agreement.
Charles Krane's son, Bruce Krane, was employed as the manager of the Pittsburgh office operated under the franchise, and under an addendum to the franchise agreement T I relieved Charles Krane from the obligation of devoting his full time to the franchise as long as Bruce Krane was employed full time by the licensee. From August, 1974, until August, 1979, Bruce Krane was employed by the licensee as a full time manager. Charles Krane did not extend the term of the agreement in accordance with paragraph 11 thereof. On July 13th he notified T I by letter that he was terminating his agreement with T I and he stated: "I am discontinuing my temporary help business as of July 14, 1979." The Pittsburgh office of T I thereupon closed its doors on Friday, July 13, 1979 and on Monday, July 16, 1979, the same office opened as "Pittsburgh Temporaries, Inc." under the ownership of Bruce Krane. This new business came into existence based on an agreement between Charles Krane and his son, Bruce Krane, under which Charles sold to Bruce all the equipment, furniture and fixtures he used as a licensee of T I. Charles also transferred to Bruce the telephone in the office, job agreements and employee applications. All of this was done for a nominal ...