City Carpet Beating Etc. Works v. Jones

36 P. 841, 102 Cal. 506, 1894 Cal. LEXIS 676
CourtCalifornia Supreme Court
DecidedMay 26, 1894
DocketNo. 15300
StatusPublished
Cited by40 cases

This text of 36 P. 841 (City Carpet Beating Etc. Works v. Jones) is published on Counsel Stack Legal Research, covering California Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City Carpet Beating Etc. Works v. Jones, 36 P. 841, 102 Cal. 506, 1894 Cal. LEXIS 676 (Cal. 1894).

Opinion

Haynes, C.

On June 6, 1887, appellant was engaged in the business of cleaning and renovating carpets at a [509]*509designated place on Eighth street in the city of San Francisco, and on that day sold his buildings, machinery, and all appliances, and the goodwill of said business to one Eeamer.

In the contract of sale the following covenant was inserted:

“ And in order to secure and protect said party of the second part in the full, free, and undisturbed use and enjoyment of the said goodwill, the party of the first part hereby promises and agrees that he will not, for and during the period of ten years from the date of this instrument, enter into or be engaged or interested in, directly or indirectly, the business of taking up, removing, cleaning, renovating, laying, or relaying carpets, and of cleaning and renovating any other fabrics in the said city and county of San Francisco, in the county of Alameda, or in the county of San Mateo.”

The property and goodwill so purchased was after-wards sold by Eeamer to the plaintiff, a corporation.

The breach of this contract complained of is that appellant afterwards engaged in carrying on said business in said city of San Francisco, on the same street, opposite plaintiff's said place of business.

Plaintiff, on the trial, waived damages, on account of the insolvency of the defendant, and obtained a decree enjoining the defendant from prosecuting or carrying on said business until the expiration of the time limited in the contract.

The demurrer to the complaint was properly overruled. The ground of demurrer was that two causes of action were united, and were not separately stated; one for breach of warranty that defendant would not injure plaintiff's business, and one for a breach of his contract not to carry on the business. I do not think that two causes of action are stated, or were intended to be stated; but if it were otherwise it is not ground of demurrer. The Code of Civil Procedure, section 430, specifies all the grounds of demurrer. The fifth is, That several causes of action are improperly united.”

[510]*510This provision applies to causes of action which cannot he embraced in the same action, though separately stated, and not to causes of action which may properly be joined in the same action under section 427, but which are not “ separately stated,” as required by the last-named section.

“The remedy is therefore not by a demurrer but by a motion to make the pleading more definite and certain by separating and distinctly stating the different causes of action.” (Pomeroy’s Code Remedies, sec. 447. See, also, sec. 446, and Bernero v. South British etc. Co., 65 Cal. 386, and Fraser v. Oakdale Lumber etc. Co., 73 Cal. 187, 190.)

Appellant’s .principal contention is that that portion of the contract between defendant and Reamer, herein-before quoted, is void, because it includes not only the city and county of San Francisco, but the counties of Alameda and San Mateo.

The Civil Code contains the following provisions:

“ Sec. 1673. Every contract by which any one is restrained from exercising a lawful profession, trade or business of any kind, otherwise than is provided in the next two sections, is to that extent void.”
“ Sec. 1674. One who sells the goodwill of a business may agree with the buyer to refrain from carrying on a similar business within a specified county, city, or part thereof, so long as the buyer, or any one deriving title to the goodwill from him, carries on a like business therein.”

Section 1675 relates to partners.

The property and business purchased from appellant was conducted in the city and county .of San Francisco, and the goodwill was of the business there conducted. It is conceded that the contract is void so far as it purports to restrict appellant from engaging in said business in the counties of Alameda and San Mateo, and that if the city and county of San Francisco had been the only locality specified in the contract it would have been valid; so that the precise question at issue is [511]*511whether the specification, of these additional counties makes the restriction void as to the city and county of San Francisco to which the judgment limits the injunction.

At common law the territorial restriction imposed by this contract would doubtless have been considered valid, inasmuch as a portion of the value of the goodwill may have accrued from customers residing in these contiguous counties, though the business was conducted in one alone; and the purchaser, unless restricted by statute, or by a controlling public policy, was entitled to the whole of the goodwill which he purchased and paid for. It was not, therefore, at common law an illegal contract, nor are such contracts declared by the statute to be illegal. They are simply void so far or to the extent that they exceed the restrictions imposed by the statute. The code introduces no new principle; it simply eliminates from the controversy arising upon such restriction the question as to what is a reasonable territorial limit, by specifically defining it, and thus preventing litigation; and in this the statute is wise and salutary, even though in certain cases, possibly in this one, it gives the purchaser less than he bought and less than he might enjoy without violating the interests of the public. The statute imposes no penalty upon the purchaser under such contract, nor could it require the seller to resume business.

As was said by this court in Brown v. Kling, 101 Cal. 295: “A contract restraining one from following a lawful trade or calling at all is invalid because it discourages trade and commerce, and prevents the party from earning a living; but the right to agree to refrain from his calling, within reasonable limits as to space, may have the contrary effect. It encourages trade, for it gives value to a custom or business built up, by making it vendible.”

In Wright v. Ryder, 36 Cal. 342, 358, 95 Am. Dec. 186, the court quoting from Story on Contracts, section 551, speaking of partial or limited restraints, said: “ Such [512]*512an agreement not only does not obstruct trade, but is oftentimes requisite and necessary, as well for the advantage of the public as of the individual.”

We see, then, that when confined within reasonable limits (and as to what is reasonable the statute is conclusive), the public, as well as the parties, are benefited, and are therefore interested in sustaining such contracts as are or may be brought within the statutory restrictions where the contract admits of division. In this case three counties are named in the contract, and I see no difficulty in upholding it as to the county in which the business was conducted, and declaring it void as to the other two counties. The boundaries of each are definite, and fixed by law. Neither includes any part of the others. If the city and county of San Francisco had alone been named the contract would have been good.

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

Related

Communication Technical Systems, Inc. v. Densmore
1998 SD 87 (South Dakota Supreme Court, 1998)
Communications Tech. Sys.
1998 SD 87 (South Dakota Supreme Court, 1998)
Treasure Chemical, Inc. v. Team Laboratory Chemical Corp.
609 P.2d 285 (Montana Supreme Court, 1980)
Centeno v. Roseville Community Hospital
107 Cal. App. 3d 62 (California Court of Appeal, 1979)
Monogram Industries, Inc. v. Sar Industries, Inc.
64 Cal. App. 3d 692 (California Court of Appeal, 1976)
Swenson v. File
475 P.2d 852 (California Supreme Court, 1970)
Loescher v. Policky
173 N.W.2d 50 (South Dakota Supreme Court, 1969)
Kaplan v. Nalpak Corp.
322 P.2d 226 (California Court of Appeal, 1958)
Guam Service Games v. Shelton
126 F. Supp. 335 (D. Guam, 1954)
Lien v. Northwestern Engineering Co.
39 N.W.2d 483 (South Dakota Supreme Court, 1949)
Johnson v. Marquis
209 P.2d 63 (California Court of Appeal, 1949)
Mahlstedt v. Fugit
180 P.2d 777 (California Court of Appeal, 1947)
Solé v. Rocafort
45 P.R. 30 (Supreme Court of Puerto Rico, 1933)
E. Solé & Co., S. en C. v. Rocafort
45 P.R. Dec. 31 (Supreme Court of Puerto Rico, 1933)
General Paint Corp. v. Seymour
12 P.2d 990 (California Court of Appeal, 1932)
Joy Manufacturing Co. v. Julian Petroleum Corp.
280 P. 952 (California Supreme Court, 1929)
Fidelity Credit Assurance Co. v. Cosby
265 P. 372 (California Court of Appeal, 1928)
Mosher v. Bellas
264 P. 468 (Arizona Supreme Court, 1928)
Commercial Credit Co. v. Phoenix Hudson-Essex, Inc.
262 P. 1 (Arizona Supreme Court, 1927)

Cite This Page — Counsel Stack

Bluebook (online)
36 P. 841, 102 Cal. 506, 1894 Cal. LEXIS 676, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-carpet-beating-etc-works-v-jones-cal-1894.