Storey v. Excelsior Shook & Lumber Co.

198 A.D. 505, 190 N.Y.S. 614, 1921 N.Y. App. Div. LEXIS 8130
Appellate Division of the Supreme Court of the State of New York·Decided November 18, 1921·Published·Cited by 3 cases

Opinion

Dowling, J.:

The plaintiff Willard M. Storey, trading as W. M. Storey Lumber Co., about January 1, 1905, commenced the business [506] of buying, manufacturing and selling boxes, shooks and other kinds of lumber, and maintained an office at 150 Nassau street, New York city; by and through his efforts and those of his employees, agents and representatives the W. M. Storey Lumber Co. built up an extensive business throughout the United States, and particularly in and about the city of New York, States of New York, New Jersey, Pennsylvania, North Carolina, South Carolina, Georgia, Maryland, and various other southern lumber producing States, and negotiated and dealt with large numbers of customers and lumber producers, numbering about 700. The names and addresses of the various customers and the names and addresses of the various lumber producers, together with detailed and summarized statements of the kind, type and quality of lumber purchased and sold by them respectively, constituted an original list, collection and compilation strictly confidential and were of great value to said plaintiff in the carrying on and conducting of the business of the plaintiff.

Since the latter part of September, 1913, until on or about the 24th day of August, 1918, the W. M. Storey Lumber Co., Inc., and Willard M. Storey, trading as the W. M. Storey Lumber Co., the plaintiffs herein, engaged and employed the defendant Frederick E. Vossnack as assistant manager in their, business hereinbefore described. Vossnack when he entered plaintiffs’ employ had no knowledge of the customers and lumber producers engaged in said trade and of the sizes, specifications, prices, credit and other questions and data relating thereto, and his knowledge thereof was gained from and while in the performance of his said duties as assistant manager of said plaintiffs. Between the early part of October, 1913, and the 24th day of August, 1918, the said companies employed the defendant Schaffel who had no knowledge of the box, shook and crating business or of customers and lumber producers engaged in the trade and of the sizes, specifications, prices, credit and other questions and data relating thereto. His knowledge was gained from and while in the performance of his duties as confidential clerk for the plaintiffs. The defendants Vossnack and Schaffel at all times had full and free access to the names and addresses of the customers and lumber producers and other trade data acquired and kept by the plaintiffs.

[507] In the spring of 1918, due to war conditions, the question of selling lumber had grown quite unimportant; it was a question of producing and shipping only; prices were advancing right along and there were government embargoes that prohibited any stock except for government use, and there were twenty people wanting to buy every car of lumber available. Storey was anxious to arrange his business so that he could offer .his services to the government. About June 4, 1918, the plaintiff W. M. Storey Lumber Co., Inc., was organized, pursuant to an agreement between plaintiff Willard M. Storey and defendants Vossnack and Schaffel, and it was agreed that the corporation be permitted to enjoy the good will and trade relations established by Willard M. Storey; it was also agreed that the corporation be paid a commission of three per cent upon certain old business retained by Storey and handled by the corporation; Vossnack was made vice-president of the corporation and Schaffel secretary, and both were directors. In June, July and August, 1918, these two conspired to obtain for themselves the plaintiffs’ business. Storey had left New York and gone to Winston-Salem, N. C., where he had interests in a mill and lumber business and where he expected to make some arrangement similar to that made in New York. While south he received a letter from Vossnack about the latter buying out the W. M. Storey Co., Inc. Storey returned to New York, where Vossnack had been negotiating with Barnett and Gottlieb, but the proposition offered was not accepted by Storey and he again returned to Winston-Salem; he wrote from there to Vossnack: I presume I am to understand, not having heard from you, that the negotiations with Barnett and Gottlieb have fallen through.” Becoming suspicious of the cause of the delay in settlement he returned to New York in August, 1918, when he learned that a corporation called the Excelsior Shook and Lumber Co. had been organized between August fifteenth and twentieth by the defendants Vossnack, Schaffel and Barnett. Vossnack and Schaffel both resigned their positions in plaintiffs’ employ by letters dated August 17, 1918, which passed him on his way to New York, having been mailed to Winston-Salem. Thereafter the defendants conducted the same business as that of the plaintiffs in competition with them and by similar [508] methods. The learned court at Special Term had found that defendants “ in pursuance of their preconceived plan, design and scheme to deprive plaintiffs of said business, customers and lumber producers and their trade connections, have made use and are now making use of the information obtained and acquired by them by virtue of said employment by the plaintiffs and which information is contained in and was obtained by the defendants from the books of account and records hereinbefore described, and have been and now are soliciting the trade and business of said customers, lumber producers and others and are visiting, calling upon, writing to, and otherwise communicating with the said customers and lumber producers and soliciting their business and have thereby acquired the business of a large number of customers and lumber producers and have been and are accepting the business of said various customers and lumber producers who solely by reason of defendants’ solicitation and representations decline longer to continue their trade relations with the plaintiffs herein.”

It has further found that Yossnack and Schaffel, while still in plaintiffs’ employ, and subsequent thereto, misappropriated various orders which were received as the property of the plaintiffs and intended for the plaintiffs, and also induced and prevailed upon said customers and lumber dealers to transfer their said orders and lumber business from the plaintiffs to the defendants Yossnack, Schaffel and the Excelsior Shook and Lumber Co., Inc. Also that in furtherance of their conspiracy they falsely represented to various lumber producers and customers with whom plaintiffs had trade relations that the latter had retired from business and had no one in charge of their business in the city of New York and that defendants had acquired the business of the plaintiffs and had become their successors. The offices of the said three defendants are on the same floor with that of plaintiffs at 150 Nassau street. The court has also found that the defendants Yossnack and Schaffel suffered defaults on the plaintiffs’ contracts, and then solicited plaintiffs’ customers for the new company they had caused to be organized; for their own purposes, the said defendants made use of the plaintiffs’ private data, to which they had access by reason of the con[509] fidence reposed in them; and they spread through the trade the report that plaintiffs were discontinuing their business and that they were taking it over. In addition to defendants’ general course of business in pursuance of their conspiracy to deprive plaintiffs of their business certain specific transactions are made the basis of complaint. These are, briefly stated:

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Storey v. Excelsior Shook & Lumber Co., 198 A.D. 505, 190 N.Y.S. 614, 1921 N.Y. App. Div. LEXIS 8130 (N.Y. Ct. App. 1921).

198 A.D. 505 (Storey v. Excelsior Shook & Lumber Co.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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