One Month of Summer; Two Employment Contracts; Three Levels of Application

In Employment Contracts, Minnesota Appellate Decisions, Supreme Court by Joseph Pull

The Minnesota Supreme Court decided two unrelated disputes about the enforcement of employment contracts within the space of thirty days this summer. Both decisions allowed the employee to elude, at least temporarily, the plain language of a contractual obligation. An employee who failed to timely return his employer’s property after leaving the company was allowed to seek a contractual payment of funds from the company, even though his employment agreement stated that failure to timely return the property allowed the employer to cancel the payment. Capistrant v. Lifetouch Nat. Sch. Studios, Inc., no. A16-1829 (July 25, 2018). An employee who left his employer to work for a competitor avoided an injunction against him continuing to work for the competitor, even though his employment contract stated that the employer was entitled to an injunction if he left the company work for a competitor. St. Jude Med., Inc. v. Carter, no. A16-2015 (June 27, 2018). This pair of decisions is educational on at least three levels. In general terms, the pair highlights the quandary of attempting to apply contractual obligations to the real world. As legal doctrine, the pair expressly resolves some basic questions of Minnesota contract law. Finally, the pair emphasize that an employer must show actual, not speculative, damage caused by the employee if the employer wishes to enforce a harsh term of the agreement against the employee.