Clark v. Liberty Nat'l Life Ins. Co.

Arthur Clark (plaintiff) worked for Liberty National Life Insurance Company (Liberty) (defendant) as an insurance agent. Clark’s duties included soliciting new customers to purchase insurance policies with Liberty in his assigned area in South Alabama. Clark also collected insurance premiums from customers in their homes and built relationships with them. Clark had signed a noncompetition agreement, which provided that for one year after he stopped working for Liberty, he could not solicit or sell policies to any of Liberty’s customers. Despite this, when Clark quit his job at Liberty, he began working for Prudential Insurance Company and sold Prudential’s insurance policies to Liberty’s customers during the one-year period after his employment ended. Liberty filed suit. At trial, the trial court heard ore tenus evidence and granted Liberty $14,819.61 in damages. Liberty presented testimony regarding the value of the loss it suffered from Clark’s breach. Liberty’s financial losses included lost profits from underwriting and investment income as well as renewal commissions. Liberty’s formula for calculating damages from Clark’s breach accounted for how long a customer had held a policy and probabilities regarding how much longer a customer would likely have remained insured with Liberty. The trial court was able to exclude certain policies that Liberty included in its damages calculations, such as policies that Clark had sold after the one-year period of restriction had ended. Clark appealed.