Levy Overall Manufacturing Co. v. Crown Overall Manufacturing Co.

24 Ohio C.C. (n.s.) 556
CourtOhio Court of Appeals
DecidedJanuary 24, 1916
StatusPublished

This text of 24 Ohio C.C. (n.s.) 556 (Levy Overall Manufacturing Co. v. Crown Overall Manufacturing Co.) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Levy Overall Manufacturing Co. v. Crown Overall Manufacturing Co., 24 Ohio C.C. (n.s.) 556 (Ohio Ct. App. 1916).

Opinion

Jones (Oliver B.), J.

Plaintiffs in error seek to reverse the judgment of the Superior Court of Cincinnati granting a permanent injunction against them and awarding $15,000 damages to defendant in error the Crown Overall Manufacturing Company.

The parties agree that an extensive business in the manufacture and sale of overalls had been carried on by Oscar Berman and Samuel Levy as partners under the name of Berman and Levy and the Crown Overall Manufacturing Company. That the partnership was dissolved .by consent, Berman buying the entire interest of Levy including specifically the good will of said partnership, the value paid for Levy’s one-half interest in this good-will being $15,000. The good will thus sold and conveyed was the good will of the business with all that imports, not merely the right to use the partnership name, occupy the old quarters or advertise as its business successor.

The facts of the case are well and fully stated in the opinion of the court below, which is reported in 16 N.P.(N.S.), 561.

Counsel for plaintiffs in error strenuously insist that the ruling of the court below in regard to soliciting the patronage of old customers is in direct conflict with the decision of the Supreme Court in Brass & Iron Works Co. v. Payne, 50 O. S., 115. They rely particularly upon the following language found in the opinion of Judge Spear, at page 118:

“He may carry on a like business in the immediate vicinity, and may solicit the patronage of old customers, both by advertisement and private solicitation, so long as he does not mislead customers into the belief that he is carrying on business as the successor of the old firm, but this does not involve an appropriation of anything which he once possessed, but has, for a valuable consideration sold.”

This language was held by the trial judge to be obiter dicta and not binding as an authority in this case. To throw all the light possible, therefore, upon that case counsel for plaintiff in error have secured from the Supreme Court files and furnished to this court a printed copy of the record and of the brief in behalf of plaintiff. A careful examination of these show that the .object of that suit was to enjoin the use of the old firm name, [558]*558by the retiring partner, and to enjoin him from representing himself in his new business as the successor of the old firm. As stated by Judge Spear in 50 O. S., at page 117:

‘ ‘ The single question of law presented by the record is whether or not, where a partnership is dissolved, one partner transferring to the other all his interest in the firm business and assets, with the understanding that the others are to- succeed to the business of the old firm, and carry it on at the old stand, but not to use the old firm name beyond a specified time, the retiring member can lawfully use that name in a similar business thereafter carried on by him in the vicinity.”

The result of the decision in that case was (p. 119):

“A perpetual injunction, restraining the defendant from using, in his business at Fostoria, the name of Walter S. Payne & Co., and from holding himself out as the successor of said firm of Walter S. Payne & Co.”

The law of the case on this point is embodied in the second clause of the syllabus

“Of this good will is the firm name; and where the contract of sale reserves to the retiring partner no rights with respect to the firm name, he can not lawfully use it in a busines of a like kind, carried on by him in the vicinity subsequent to such dissolution. ’ ’

The rules of the Supreme Court provide that the points decided shall appear in the syllabus. Rule VI of these rules has remained the same from 5 O. S. through 82 O. S. Statements made by a judge in his opinion by way of argument or illustration, not called for by the issues of the case to be decided, do not become authoritative. 11 Cyc., 755; Cohen v. Virginia, 6 Wheat. (U. S.), 264, 399; Carroll v. Carroll, 16 How. (U. S.), 275, 287; Pollock v. Former's L. & T. Co. 157 U. S., 429, 574; Love v. Miller, 53 Ind., 294, 299.

In Pioneer Trust Co. v. Stick, 71 O. S., 459, 466, Judge Spear himself in giving the opinion of the court said':

“The syllabus controls, even though the expression of the judge should be thought to indicate a state of mind favorable to the contention of counsel upon a question not before the cour-t.”

[559]*559The language used by Judge Spear in 50 O. S.,.at 118, quoted and relied on by counsel for plaintiffs in error here, is no doubt based upon an interesting note written by the editor, found appended to the ease of Berganini v. Bastian, 48 American Report, 216. This ease was cited and relied upon in the brief of plaintiff in error there. This note commences at page 223 and discusses the leading English cases on the subject of good will, beginning with Labouchere v. Dawson, L. R. 13 Eq., 332 (1872), and ending with Pearson v. Pearson, L. R. 27 Ch. Div., 345 (1884), and summing up with three general rules found on page 232, which appear to be drawn from the last named case. The case of Pearson v. Pearson, which discredited Labouchere v. Dawson, has since been overruled by the House of Lords in the case of Trego v. Hunt, L. R. Appeal Cases. (1896), page 7.

While we agree with counsel for plaintiffs in error that if the rule of law in this state had been established by our Supreme Court based upon that found in Pearson v. Pearson there would be no justification in any inferior court to disregard that rule because Pearson v. Pearson has been in turn overruled by Trego v. Hunt, yet we can not concede that the ease of Brass & Iron Works Co. v. Payne, 50 O. S., 115, established the rule of Pearson V. Pearson in Ohio. It certainly -was- not intended by- it to overrule or weaken the authority of Burckhardt v. Burckhardt, 36 O. S., 261; 42 O. S., 474 (2 W. L. B., 22; 8 W. L. B., 253 and 14 W. L. B., 108). This case recognizes the rule of Labouchere v. Dawson, which was approved by Trego v. Hunt, in which the rule is thus stated:

“Where the good will of a business is sold' (without further provision), the vendor may set up a rival business, but he is not- entitled to canvass the customers .of the- old firm, and may be restrained by injunction from soliciting any person who was a customer of the old firm prior to the sale to continue to deal with the vendor, or not to deal with the purchaser.”

And we must still regard Burckhardt v. Burckhardt as authority.

Counsel for plaintiffs in error discuss in detail the reasoning of the trial judge in his opinion as to the amount of damages. [560]*560It would appear that some of the detailed items as there discussed may be too large, but taking the total as finally fixed, considering all of the evidence and especially the conduct of defendants below, under the rules laid down by Burchhardt v. Burchhardt, 42 O. S., 474, the amount of the judgment can not be deemed excessive or as being manifestly against the weight of the evidence.

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Related

Pollock v. Farmers' Loan & Trust Co.
157 U.S. 429 (Supreme Court, 1895)
Love v. Miller
53 Ind. 294 (Indiana Supreme Court, 1876)

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Bluebook (online)
24 Ohio C.C. (n.s.) 556, Counsel Stack Legal Research, https://law.counselstack.com/opinion/levy-overall-manufacturing-co-v-crown-overall-manufacturing-co-ohioctapp-1916.