Johnston v. Wilkins, 2003 VT 56

Summary

The Vermont Supreme Court held that res judicata barred collateral reformation of a noncompetition agreement incorporated into a prior stipulated judgment absent grounds under Vermont Rule of Civil Procedure 60(b). The court held that the agreement's twenty-mile radius unambiguously meant a straight-line radius, found that Wilkins violated the agreement by working for Catamount Veterinary Services, and remanded for an award of reasonable attorney's fees to Johnston.

Holdings

1. A stipulated settlement incorporated into a final court judgment has the preclusive effect of a final judgment, and an unappealed judgment may be disturbed only under the criteria of V.R.C.P. 60(b). Res judicata therefore barred the superior court from reforming the noncompetition agreement absent a showing satisfying Rule 60(b).
2. The phrase "within a 20 mile radius" unambiguously establishes a distance measured by a straight line from the designated center point, not by traveled highway miles.
3. Wilkins violated the unmodified noncompetition agreement by working for Catamount because Catamount was within the twenty-mile radius. Johnston was entitled to injunctive relief and reasonable attorney's fees under the agreement even though he failed to prove actual damages.
4. The superior court did not err by declining to extend the duration of the noncompetition agreement or award damages and attorney's fees for intentional interference.

Questions Presented

1. Whether res judicata barred the superior court from reforming or otherwise collaterally reviewing the noncompetition agreement incorporated into the parties' prior stipulated judgment.
2. Whether the term "within a 20 mile radius" unambiguously required measurement by a straight line rather than highway miles.
3. Whether Wilkins violated the noncompetition agreement by working for Catamount Veterinary Services.
4. Whether Johnston was entitled to reasonable attorney's fees under the agreement despite the absence of proven actual damages.
5. Whether the noncompetition agreement should be extended and whether Johnston was entitled to damages or attorney's fees on his intentional-interference claim.

Disposition

reversed_and_remanded