Williams v. Farrand

14 L.R.A. 161, 50 N.W. 446, 88 Mich. 473, 1891 Mich. LEXIS 567
CourtMichigan Supreme Court
DecidedNovember 20, 1891
StatusPublished
Cited by46 cases

This text of 14 L.R.A. 161 (Williams v. Farrand) is published on Counsel Stack Legal Research, covering Michigan Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Williams v. Farrand, 14 L.R.A. 161, 50 N.W. 446, 88 Mich. 473, 1891 Mich. LEXIS 567 (Mich. 1891).

Opinions

McGrath, J.

Complainants and defendants had beem for some years engaged as wholesale druggists on Darned street east, in the city of Detroit, as copartners, under-the name and style of Farrand, Williams & Co. There were no articles of copartnership, and no term fixed lorwhich the partnership was to continue.

Prior to the taking of the annual inventory in January,.. 1890, defendant Jacob S. Farrand expressed to complainant Sheley a desire to dissolve the copartnership... Mr. Sheley declined to say anything until the annual, inventory should be taken, and the business of the year-settled up. On the 25th of January, 1890, after the completion of the inventory, defendants made a proposition in writing to—

“Pay Messrs.' Sheley & Brooks, for their interest in the-firm of Farrand, Williams & Co., the amount of their interest being fifty thousand dollars ($50,000), the sum of' sixty thousand dollars ($60,000), or they will take for-their interest, the amount being one hundred thousand dollars ($100,000), the sum of one hundred and twenty-[476]*476thousand dollars ($120,000), the same to be paid in cash, or in notes acceptable to the parties who sell, one week from to-day, Saturday, the first day of February next; the store to be leased to the party purchasing for a term of five years at a rent of eight thousand dollars ($8,000) a year, and the warehouse to be rented to the party purchasing at a net rental of 6 per cent, a year on the cost of their interest therein.”

On the following Monday Mr. Sheley accepted defendants’ offer to sell, and on the 1st day of February following a bill of sale was prepared, reciting, among other things, that defendants, in consideration of the sum of $120,000, paid to them by Alanson Sheley, party of the second part,—

“Have bargained and sold unto the said party of the second part * * * all our right, title, and interest to the within-mentioned resources of said firm, including the good-will attendant upon the business.”

This bill of sale was not executed, objection .being made to the clause, “including the good-will attendant upon the business;” and a new instrument was prepared, reciting that defendants, parties of the first part,—

“For and in consideration of the sum of one hundred and twenty thousand dollars, * * * to them paid by Alanson Sheley, * * * of the second part, * * * have bargained and sold, and by these presents do grant and convey, unto the said party of the second part, his executors, administrators, or assigns, all our right, title, and interest in the firm of Farrand, Williams & Company.”

This instrument was executed, the insurance policies were assigned by Farrand, Williams & Co. to Williams, Sheley & Brooks, and an agreement to assume and pay-all the debts of the old firm was executed by Williams, Sheley & Brooks, and delivered to defendants.

Defendants afterwards formed a copartnership under the firm name of Farrand, Williams & Clark, and opened a wholesale drug establishment at No. 32 Woodward [477]*477avenue. Complainants adopted the name and style of Williams, Sheley & Brooks; posted their firm name, as successors to Farrand, Williams & Co., over their place of business; had the words Williams, Sheley & Brooks, Successors to” printed in red ink over the words “Far-rand, Williams & Co.” wherever tüe latter appeared upon letter-heads, bill-heads, labels, and other stationery; advertised themselves in the newspapers and trade journals as Williams, Sheley & Brooks, successors to Farrand, Williams & Co.; and sent out circulars to the trade containing not only their firm name, but the names of the individual members of the new firm. Defendants also extensively advertised the new enterprise through the same mediums, calling special attention to the names of the members of the new firm, their long connection with the drug business, and the dissolution of the old firm, and soliciting trade.

The complainants contend that the assignment by defendants of all interest in the business carried with it the good-will of the business, and, having purchased the good-will of that business, they are entitled to the exclusive use of the old firm name; that, while defendants have the right to engage in the same line of business, they have'not the right to such a collocation of their own ñames as will produce confusion, attract customers, and secure orders, letters, and goods intended for the old firm; that defendants have no right to simulate their labels, to solicit their customers, or entice away their employés.

“Good-will” has been defined by this Court to be—

“The favor which the management of a business has won from the public, and the probability that old customers will continue their patronage.” Chittenden v. Wit-heck, 50 Mich. 401.

Lord Eldon, in Cruttwell v. Lye, 17 Ves. 335, defined [478]*478jt as simply the probability that old customers will resort to the old place.

The following propositions must be regarded as established by the clear weight of authority:

1. Though a retiring partner may have assigned his interest in the partnership business, including the goodwill thereof, to his copartner, he may, in th'e absence of .an express agreement to the contrary, engage in the same line of business in the same locality, and in his own name.

2. He may, by newspaper advertisements, cards, and general circulars, invite the general public to trade with him, and through the same mediums advertise his long connection with the old business, and his retirement therefrom.

3. He will not be allowed, however, to use his own name, or to advertise his business, in such a way as to lead the public to suppose that he is continuing the old business; hence, will not be allowed to advertise himself ¡as its successor.

4. The purchaser will not, in the absence of an express ¡agreement, be allowed to continue the business in the name of the old firm.

5. That no man has a right to sell or advertise his ■own business or goods as those of another, and so mislead the public, and injure such other person.

In Myers v. Buggy Co., 54 Mich. 215, A., B., and C. had been carrying on business as copartners at Kalamazoo, under the name and style of “The Kalamazoo Wagon Company.” A., B., and C. sold to complainant “all of their interest in the property, money, assets, and good-will,” etc., in and to their business. After such sale complainant's assignors formed a corporation under the name of “The Kalamazoo Buggy Company;” pitched their plant in the same locality; commenced the manu[479]*479ffacture of the same class of goods; issued circulars to the trade, with descriptive cuts of the same character and appearance as those contained in complainant’s circulars, ¡and advertised their place of business as being in the .same locality. In that case the name of “The Kalamazoo Wagon Company” was an assumed name. The only -distinctive feature in the name adopted by defendants ■was the use of a word of similar meaning to that for which it had been substituted. The defendants were not using their own names. It was a pure case of piracy, .and the facts clearly indicated an intention to deceive .the public. As was said in Burgess v. Burgess, 3 DeGex, M. & G. 896:

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Bluebook (online)
14 L.R.A. 161, 50 N.W. 446, 88 Mich. 473, 1891 Mich. LEXIS 567, Counsel Stack Legal Research, https://law.counselstack.com/opinion/williams-v-farrand-mich-1891.