Anthony v. Hitchcock

71 F. 659, 1896 U.S. App. LEXIS 2493

• Court: U.S. Circuit Court for the District of Western Michigan
• Decided: January 4, 1896
• Status: Published

Opinion

SEVERENS, District Judge

(after stating the facts as above). The declaration states that, in part consideration of the conveyance of land, the defendant agreed, among other things, that he would not do anything which would conflict with the coal or flsh business of the plaintiff. It then proceeds,to allege that thedefendant had leased the premises conveyed to other parties for the purpose of carrying on the same business as that of the plaintiff, and had permitted them to enlarge and occupy and use the dock thereon in conducting that business in competition, etc. These premises are alleged to have been in the vicinity of the plaintiff’s place of business on the same stream, and the business is alleged to be a competing business with, that of the plaintiff, and injurious thereto, and it is alleged that the plaintiff has suffered therefrom a diminution of business and reduction of profits, etc.

The leasing of the premises “for the purpose” of the conducting by others of a business in competition with that of the plaintiff, and permit iing them to carry on the competing business thereon, would appear to me to he a breach of an agreement not to do anything which would conflict with the plaintiff’s business. I think, therefore, that the declaration is sustainable upon grounds which do not necessarily involve the question at large, how far contracts must be held void as being in restraint of trade. The modern decisions seem to be sei f ling down upon the test whether the restriction is one limited to the protection of the plaintiff’s business. If it is, it is recognized as reasonable and lawful; and otherwise if not so limited.

Upon the argument it was contended that the agreement was for an unlimited restraint of the defendant’s doing those kinds of business anywhere*. The plaintiff contends that, upon a fair construction of the agreement, the restraint is limited to the premises sold to the defend,mt. And there are several considerations leading to that conclusion. There is the recital of the conveyance of the premises. They were adapted to such business. The alternative words, “or do anything that will conflict with the said coal or flsh business” of tbe plaintiff, are an implication of a limitation. And, further, it is a rale of construction that, if the words will bear an interpretation adapted lo express a lawful purpose, that interpretation will be given, so that the agreement shall have effect rather than fail utterly. But the declaration does not allege such a contract as this would be with such implications in respect of the words which relate to the defend.nit going into the coal or flsh business; and, upon demurrer, the conrl must treat the contract as it is alleged in the pleadings. I do not, therefore, decide this question of construction. But I am salisiied that the stipulation that the defendant should not do anything to conflict with the plaintiff’s business is valid, as alleged, and upon a sufficient consideration.

The demurrer is overruled, and leave to plead over is allowed to the defendant.