Arnold v. Burgess

241 A.D. 364, 272 N.Y.S. 534, 1934 N.Y. App. Div. LEXIS 8252
CourtAppellate Division of the Supreme Court of the State of New York
DecidedJune 8, 1934
StatusPublished
Cited by4 cases

This text of 241 A.D. 364 (Arnold v. Burgess) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Arnold v. Burgess, 241 A.D. 364, 272 N.Y.S. 534, 1934 N.Y. App. Div. LEXIS 8252 (N.Y. Ct. App. 1934).

Opinion

O’Malley, J.

The judgment appealed from awards damages and injunctive relief because of alleged unfair competition practiced by the defendant. Assuming that the decision is sufficient to justify the judgment appealed from, the question presented is whether the evidence sustains the findings made and conclusions reached.

The plaintiff, a civil engineer, furnishes “ quantity surveys ” to iron and wire shop owners. These surveys are computations made from building plans and specifications and are intended to show the amount and character of iron and wire required. Multigraphed facsimiles are furnished to firms and individuals and used by them as a basis for submitting bids to owners or contractors. Surveys require skill and experience in their preparation. If they should omit any part of the material required a bid predicated thereon might be too low and result in the award of an unprofitable contract. On the other hand, if the estimate of the amounts of material is too high, a bid based thereon would also be too high and the contract would likely be awarded to one whose bid was based upon an accurate survey. While the plaintiff’s service was the principal one of its character in the field, he had no monopoly of quantity surveying. He admitted that many others were as competent as he to do similar work.

The defendant is the president and representative of the Allied Building Metal Industries, an unincorporated association, whose members are fabricators of metal work used in building construction. Included in its membership are some thirty-two iron and wire shop owners, one of several distinct groups included in the association. Others were an architectural iron and bronze working group. It is governed by a board of control, the chairman of which, one Donnelly, was a paid employee. Its object seems to have been that of the ordinary trade association — to promote the business interests of its membership.

' Originally many iron and wire work shops had their own estimating force. Of the thirty-two in the defendant association, twenty-eight were so equipped. In others, the owners or partners attended to this phase of the work and only the small shops were dependent on outside quantity surveys.

The plaintiff began his business in 1921. Because of its efficiency and low cost (copies of plaintiff’s work being furnished to a number of customers), his service commended itself to the trade. By 1927 it had grown so that the plaintiff was serving between fifty and seventy-five per cent of the potential users of such surveys, and his customers were divided about equally between members of the defendant association and non-members. About this time he added to the survey service an estimate of the cost of material to [366]*366be used and the overhead. This feature was wholly experimental and its use was optional with the customers served. Concededly it was discontinued in January, 1928, but whether under protest or objection on the part of some of the members of the defendant association, seems immaterial. Plaintiff’s business had prospered, his evidence showing that for the year 1927 he received from members of the defendant association in excess of $15,000 and from nonmembers in excess of $11,000.

The parties are in substantial agreement upon the facts as thus far outlined; in partial agreement upon other facts about to be stated; and in sharp disagreement upon the motive that controlled the defendant in its discontinuance of the use of plaintiff’s survey services and its decision to require each member to establish for its own use a similar service within its own organization.

Plaintiff contends that the defendant was motivated by a desire to destroy legitimate and useful competitive bidding in the trade (claimed to have been effected through his service) and to that end set about to destroy plaintiff's business. His contention in the main has been sustained by the learned justice at Special Term. The defendant on the other hand urges that it was actuated by a desire merely to further and promote the best interests of its members. This, it is urged, it had a right to do. even though its action resulted in financial loss to the plaintiff.

Early in 1928 the question of the advisability of using outside survey services such as that conducted by the plaintiff was given serious consideration and discussion among the defendant’s membership. Of this the plaintiff had notice, and his advice and participation in a consideration of the question was invited. There was evidence tending to show that the plaintiff urged that all members of the association should be required to take his service. In addition, the plan of the defendant establishing a 'survey service for all of its members of which the plaintiff would have charge was also considered. The plaintiff was willing to accede to this plan. He also expressed his views in writing to the association, in which he submitted and discussed several propositions with a view to reaching some adjustment and agreement satisfactory to both sides.

Without reciting in detail these discussions and negotiations, suffice it to say that the defendant reached the conclusion that it would no longer permit its members to use the plaintiff’s service, and further decided that it would not establish a central survey service for the use of its members under the supervision of the plaintiff. On the other hand and on March 15, 1928, it adopted a resolution approving of the recommendation of the board of control that each member of the association do its own estimating [367]*367with its own employees and refrain from patronizing any estimating bureau.

From the date of the adoption of this resolution, a great majority of defendant’s members ceased using the plaintiff’s service. While the plaintiff retained the patronage of some of the defendant’s members and succeeded in inducing some of those who had ceased to take his service to again subscribe and continue their patronage, his income from the defendant’s membership fell from some $15,000 to the nominal sum of $1,383 in 1931. There was evidence tending to show that the defendant organization, by threats of censure, at least, induced some of those who had returned to plaintiff as his customers, to refrain from longer using his service.

No secondary or illegal boycott is involved. The resolution of the defendant operated only upon its own members and plaintiff’s customers from outside sources were left entirely free to continue to patronize the plaintiff. His income from such source between 1927 and 1931 continued substantially the same and in fact had increased to $15,000 in 1930, over $11,000 in 1927.

As already noted, plaintiff contends that the defendant’s purpose in discontinuing his service and requiring its members to establish their own was for the purpose of destroying competitive bidding in the trade. In support of his claim evidence was offered tending to show that the defendant complained because plaintiff’s service enabled the smaller and less responsible concerns in the trade (and which were unable to maintain their own survey force) to submit bids on work where they otherwise would not have been able to so do. The defendant, admitting that the plaintiff’s service resulted in bids from this source, contended that experience had demonstrated that such bidding was injurious to the trade, as it enabled small and irresponsible shops to buy the service and make bids which they otherwise would never have made.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Individual Retail Food Store Owners Ass'n v. Penn Treaty Food Stores Ass'n
33 Pa. D. & C. 100 (Philadelphia County Court of Common Pleas, 1938)
Wolfenstein v. Fashion Originators Guild of America, Inc.
244 A.D. 656 (Appellate Division of the Supreme Court of New York, 1935)

Cite This Page — Counsel Stack

Bluebook (online)
241 A.D. 364, 272 N.Y.S. 534, 1934 N.Y. App. Div. LEXIS 8252, Counsel Stack Legal Research, https://law.counselstack.com/opinion/arnold-v-burgess-nyappdiv-1934.