Thursday, November 21, 2013

Daynard v. Ness, Motley, Loadholt, Richardson & Poole, P.A. case brief

Daynard v. Ness, Motley, Loadholt, Richardson & Poole, P.A. case brief summary
290 F.2d 42 (2002)

Appellant United States challenged the judgment of a federal district court (Florida), which dismissed its action against appellee former employee alleging breach of fidelity. The district court dismissed for failure to state a claim because appellant could show no damages.

Appellee was employed by appellant government and was responsible for approving the selection and employment of architect-engineering firms in connection with projects likewise approved for the use of appellant's forces in Western Germany. Appellee set up corporations through which engineering work would be done and also negotiated with a German firm for the purpose and objective that an agreement would be entered into whereby the foreign firm would be awarded a contract. Appellee received payment for his part in securing the contracts. Appellant brought an action alleging breach of fidelity. The district court dismissed the action because appellant failed to state a claim.


  • On appeal, the court reversed and remanded, finding that the complaint stated a claim. 
  • The court held that appellee was fully accountable for his action during his employment but not for any action while he was carried on the payroll to receive accumulated compensation though not an active employee or after the termination of his employment. 
  • The court reasoned that it was not unlawful for a former employee to take full advantage of knowledge and experience gained from his employment.

The court reversed and remanded the dismissal of appellant United States' action for breach of fidelity for failure. The court held that the complaint stated a claim and that appellee former employee had a duty to account including any gains received as a result of his breach of fidelity preceding appellee's terminal leave.

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