Plaintiff contends the trial judge misconstrued the regulation � that properly interpreted the language permits the type of noncompetitive arrangement defendant entered into with plaintiff. Alternatively, plaintiff contends that the regulation was amended effective April 5, 2004, and in its present form clearly permits such noncompetitive agreements. In its present form it reads:
A licensee shall not enter into any business agreement that interferes with or restricts the ability of a client to see or continue to see his or her therapist of choice.
Karlin v. Weinberg, 77 N.J. 408 (1978), rejecting a per se rule of unenforceability, held that restrictive covenants ancillary to employment contracts between physicians are enforceable to the extent that they protect a legitimate interest of the employer, impose no undue hardship on the employee, and are not injurious to the public.
However, Karlin dealt with general rules as to restrictive covenants in the absence of special regulations governing the profession involved. More akin to the facts is Dwyer v. Jung, 133 N.J. Super. 343 (Ch. Div. 1975), aff’d o.b., 137 N.J. Super. 135 (App. Div. 1975), which noted the personal, highly fiduciary nature of the attorney-client relationship and held that restrictive covenants between attorneys are per se unreasonable and unenforceable as injurious to the public interest. Karlin distinguished Dwyer by noting that restrictive covenants are barred by the disciplinary rules governing the profession, DR2-108(a).
Here, as in Dwyer, the relevant board (the State Board of Psychological Examiners) has adopted a regulation restricting psychologists from entering into restrictive covenants.
The regulation in effect at the time of the decision in the Chancery Division, N.J.A.C. 13:42-10.16, was intended to restrict psychologists from entering into restrictive covenants much as DR2-108(a) restricted attorneys. Indeed, in adopting the regulation, the Board of Psychological Examiners described it as a ban on restrictive covenants that is modeled generally on the Rules of the New Jersey Supreme Court, citing RPC 5.6, the contemporary analog of DR2-108(a). See 26 N.J.R. 4739.
Nor is this analysis altered by the board’s adoption of new language in 2004, subsequent to the trial. The new regulation merely articulates the same restriction in language that shifts the focus of concern from the rights of the psychologist to the rights of the patient. Moreover, retroactive application of an administrative rule is not favored, and there is no evidence of any intent on the part of the board to apply the 2004 version retroactively.
Also, apart from the existence of the regulations, the nature of the practice of psychology and the uniquely personal patient-psychologist relationship forbid any restrictions that might interfere with an ongoing course of treatment. It is not sufficient to say that the psychologist can continue to treat patients who seek out the doctor. A psychologist who changes his office location, voluntarily or involuntarily, has a duty to inform patients of the change and the new location and phone number. To do otherwise may be akin to abandonment.
Held: The limitations plaintiff seeks to enforce against defendant interfere with a critical patient-psychologist relationship and with the right of the patient to continued treatment from that psychologist. They cannot be enforced.
Affirmed.
� Digested by Steven P. Bann
[The slip opinion is 7 pages long.]
For appellant � Richmond & Burns (Michael R. Speck on the brief). No brief was filed on behalf of respondent.
