My Laundry Co. v. Schmeling

109 N.W. 540, 129 Wis. 597, 1906 Wisc. LEXIS 92
CourtWisconsin Supreme Court
DecidedNovember 7, 1906
StatusPublished
Cited by32 cases

This text of 109 N.W. 540 (My Laundry Co. v. Schmeling) is published on Counsel Stack Legal Research, covering Wisconsin Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
My Laundry Co. v. Schmeling, 109 N.W. 540, 129 Wis. 597, 1906 Wisc. LEXIS 92 (Wis. 1906).

Opinion

MARSHALL, J.

There is no assignment of error that the findings of fact or any of them are contrary to or not supported by the evidence. Some branches of the appellant’s argument refer to that subject, but as there is no assignment •of error, specially, in respect thereto we shall not examine any question in that regard, except where it is deemed to be necessarily called for by some assignment of error as to rulings on motions.

I.

The first four assignments of error relate to the subject of whether the complaint states a cause of action. The various propositions suggested for consideration, so far as they seem material, will be treated in their order.

1. There is no allegation in the complaint that the re•straint sought to be imposed on the defendant is necessary to the protection of plaintiff’s business.

The complaint contains this allegation:

“Notwithstanding said agreement, and contrary to the ■terms thereof, the said defendant has nevertheless again en[605]*605gaged in tbe laundry business in tbe city of Milwaukee by associating himself with tbe Badger Laundry, . . . and that tbe inevitable result of said connection, if tbe same be permitted to continue, . . . will be a large diminution in the value-of tbe good will of said business.”

That seems to sufficiently negative tbe proposition. Moreover, when a person sells out bis interest in an established business and agrees not to enter into tbe same kind of business or be concerned in it in competition with that so sold, by necessary implication such agreement is material to tbe protection of such business.

2. There is nothing in tbe complaint showing that defendant before tbe commencement of tbe action breached tbe agreement by doing anything injurious to tbe plaintiff.

What has been said is a sufficient answer to that proposition. It was not essential that actual injury should have been caused before tbe commencement of tbe action in order to enable respondent to maintain tbe same. It was sufficient that there was an actual breach of tbe agreement mentioned,, which, unless restrained, would cause injury to plaintiff of a nature not remediable adequately in an action at law.

3. Tbe contract is one in restraint of labor and is invalid on that ground.

We are not favored with any authority to tbe effect that one may not in selling out bis interest in a business surrender, for a reasonable length of time and within reasonable limits as to territory; bis liberty to engage in a competing business, either as proprietor or employee. It would seem that tbe same rule which permits a person in selling out his-interest in a business, as a part of tbe transaction to restrict bis liberty to impair tbe value of tbe thing sold by engaging in tbe £ame kind of trade in one capacity, would justify restraining such liberty as to engaging in such business in any other capacity. That contracts of tbe former character, reasonable as to time and space, are valid is not questioned,. [606]*606'They have been sustained by tbis and other courts generally. Berlin M. Works v. Perry, 71 Wis. 495, 38 N. W. 82; Richards v. Am. D. & S. Co. 87 Wis. 503, 58 N. W. 787; Palmer v. Toms, 96 Wis. 367, 369, 71 N. W. 654; Tecktonius v. Scott, 110 Wis. 441, 86 N. W. 672; Cottington v. Swan, 128 Wis. 321, 107 N. W. 336; Ross v. Sadgbeer, 21 Wend. 166; Cowan v. Fairbrother, 118 N. C. 406, 24 S. E. 212; Hoagland v. Segur, 38 N. J. Law, 230; Perkins v. Clay, 54 N. H. 518; Guerand v. Dandelet, 32 Md. 561; Warren v. Jones, 51 Me. 146; Anchor E. Co. v. Hawkes, 171 Mass. 101, 50 N. E. 509; Hitchcock v. Anthony, 83 Fed. 779, 28 C. C. A. 80; Sternberg v. O'Brien, 48 N. J. Eq. 370, 22 Atl. 348; Barr v. Craven, 89 L. T. Rep. 574; Diamond M. Co. v. Roe-ber, 106 N. Y. 473, 13 N. E. 419; Wood v. Whitehead Bros. Co. 165 N. Y. 545, 59 N. E. 357; Nat. E. & S. Co. v. Haberman, 120 Fed. 415; Bancroft v. Union E. Co. 72 N. H. 402, 57 Atl. 97.

The reason of the rule aforesaid, in terms or effect, is stated in the cases cited this wise: Inasmuch as public policy requires that a man should be free to sell in the most advantageous way what he has obtained by his skill or other means, the same policy should permit him to enter into restrictive agreements in aid of the thing sold, provided the restrictions, in the judgment of the court, are not unreasonable, having regard to the subject matter of the contract.

If the scope of the contract here were so broad as counsel for appellant contends, there might be some question as to its validity in its entirety. It is argued that the language “in any manner, either by conducting a laundry establishment on his own behalf or in conjunction or jointly with any other persons, or by entering the employ of any person, firm, or corporation engaged in such business, in the capacity of an officer, manager", solicitor, or any other capacity whatsoever,” if enforced, would deprive appellant of liberty to pursue any manner of labor for any person or concern engaged in the [607]*607laundry business. It does not seem so. Tbe words “in tbe •capacity of an officer, manager, solicitor, or any other capacity whatsoever” refer to tbe words “engage in any manner in tbe laundry business in tbe. city of Milwaukee.” Tbe real meaning is that appellant shall not engage in tbe laundry business by entering into tbe employ of a person engaged in such business to work therein in any capacity whatever. Like contracts have been elsewhere similarly construed.

In Barr v. Craven, 89 L. T. Rep. 674, tbe facts were .that an agent of an insurance company employed to serve in a particular district contracted “that be would not interfere directly or indirectly with tbe business” after resigning or being dismissed from bis agency. Tbe contract was construed to mean tbe business of tbe society in tbe district in which tbe agent contracted to aid it, and as so construed it was held valid.

Sternberg v. O’Brien, 48 N. J. Eq. 370, 22 Atl. 348, seems to touch this case in respondent’s favor at all points. Tbe defendant entered tbe employ of tbe plaintiff, who was engaged in tbe instalment clothing business, in tbe capacity of collector, agreeing in consideration of tbe employment that for one year after its termination “be would not engage in or be 'Concerned or interested in tbe instalment clothing business, in tbe city of Newark or Jersey City, on bis own account, or as tbe agent or employee of any other person or persons, in any capacity.” Tbe court construed the contract as if it read will not engage in or be concerned or interested in tbe instalment clothing business in tbe city of Newark or Jersey City in any capacity, saying:

“It thus appears that tbe defendant’s promise is that be will not take employment in a particular business in any capacity. When, therefore, tbe whole of tbe restrictive clause is read, it is made entirely plain that tbe restraint which tbe defendant put upon himself is not general, but partial, and that tbe only thing which be has prevented himself from doing, after be ceases to be an employee of tbe complainant, is [608]*608engaging in or being concerned or interested in tbe instalment clothing business.

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109 N.W. 540, 129 Wis. 597, 1906 Wisc. LEXIS 92, Counsel Stack Legal Research, https://law.counselstack.com/opinion/my-laundry-co-v-schmeling-wis-1906.