Case ID: ny-st-rep_50/html/0124-01.html
Source: Caselaw Access Project
Author: {"author": "O’Brien, J. Barrett, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The W. J. Johnston Co., Limited, App'lt, v. Walter T. Hunt et al., Resp'ts.
    
      (Supreme Court, General Term, First Department,
    
    
      Filed December 16, 1892.)
    
    1. Contract&emdash;Services&emdash;Injunction.
    The services of an advertising agent, although valuable, are not of the character required to authorize the issuing of an injunction, in an action for breach of contract, to prevent his working for other persons in violation Of his contract of employment.
    2. Equity&emdash;When court will not retain action to administer leqal relief.
    If, at the time of the commencement of an action in equity, in which both equitable and legal relief were sought, the facts warranted equitable relief, but, by reason of subsequent change in facts and circumstances, equitable relief is no longer necessary, or, upon the facts proved upon the trial, cannot be granted, the court, in the exercise of discretion, will retain the action to administer relief at law in the manner provided for the trial of legal actions. If, however, the evidence discloses that, at the beginning of the suit, the plaintiff was not entitled to any equitable relief, the complaint will be dismissed without prejudice to plaintiff’s right to proceed for any other relief to which he may be entitled in the ordinary way by an action at law.
    (Barrett, J., dissents.)
    Appeal from judgment of special term dismissing complaint.
    
      Thomas J. Keighorn, for app’lt;
    
      John Henry Hull, for resp’ts.
   O’Brien, J.

&emdash;This action was brought to obtain an injunction restraining the defendant Hunt from working for the defendant, the Electric Age Publishing Co„ in the capacity of advertising solicitor or agent, and for damages, on the ground that Hunt had agreed “ to devote his entire time and attention to the interests ” of the Johnston Co., “ in the capacity of advertising solicitor, and to do similar work for five years from the first day of June, 1890.”

Upon the trial, the written agreement between the parties was produced. By its terms, in addition to the provision above quoted, it further provided that the defendant Hunt, while in the employment of the plaintiff, would not “ devote _any_ of histime or attention, during the business hours or otherwise, in the interests or to the advantage of any other corporation, company, person or firm, electrical or otherwise, without the written consent ” of the plaintiff.

This agreement, as shown by the testimony, was wantonly and without any just cause or excuse broken by the defendant Hunt. Being dissatisfied with the former agreement entered into between them, he induced the plaintiff to cancel the same, and further induced it to pay $4,000 in cash, and thereupon executed the agreement which it is now sought to enforce against him.

Upon such a state o£ facts, and concededly out of no consideration for the defendant Hunt, whose bad faith was made apparent, the learned trial judge dismissed the plaintiff’s complaint, upon the ground that the contract was of such a nature as not to-entitle the plaintiff to an injunction restraining the defendant Hunt from giving his services to the other defendant, who, it appears, carries on a paper similar to that conducted by the plaintiff,, and in competition with it. The question thus presented, as stated in Daly v. Smith, 38 Sup. Ct., 158; 49 How. Pr., 150, is whether or not a court of equity will interfere by injunction to prevent a breach of a contract for personal service, or whether the complainant must look to his damages at law as his sole redress. This case, Daly v. Smith, as well as all cases germane to the subject, observe the distinction which is to be noted between affirmative and negative covenants in such an agreement, and while the court does not possess the power to compel a person to render service which he has agreed to perform, yet when he has stipulated not. to work for another, the court can and will, in a proper case, prevent his doing so.

It is not, however, in all cases where contracts are made for personal services that a court of equity will intervene, but only in cases where, as stated in Pomeroy’s Equity Jurisprudence, vol. 3, § 1343, “ a contract stipulates for special, unique or extraordinary personal services or acts, or for such services or acts to be rendered or done by a party having special, unique and extraordinary qualifications, as, for example, by an eminent actor, singer,, artist, and the like.”

As said by Mr. Justice Barrett in Strobridge Company v. Crane, 35 St. Rep., 473: “ It may sometimes be difficult to say just what is a special, unique and extraordinary service, or whether the employee possesses special, unique or extraordinary qualifications. The solution may generally be reached by the inquiry as to-whether a substitute for the employee can be readily obtained, and whether such substitute will substantially answer the purpose of the contract; in other words, whether the individual service specially contracted for is essential to prevent irreparable injury. The foundation of jurisdiction is the inability of the law to afford adequate redress.”

By the evidence in this' case it was shown that the plaintiff, immediately after the defendant had broken his contract, substituted in his place another; and, while there is some slight evidence to-show that the effect of the withdrawal of the defendant Hunt and the substitution of another resulted for the time being in some loss of advertising to the plaintiff’s paper, yet it failed to establish what is required in cases of this kind, viz., that the injury was irreparable, not capable of being ascertained and redressed by a suitable - action at law and that Hunt possessed “ special, unique or extraordinary qualifications as an advertising agent- or solicitor.” There can be no doubt that his services were valuable, because this is evidenced by the character of the agreement, the efforts put forth by plaintiff to retain his services, and the consideration provided in the agreement for his compensation.

Regarding, however, the character of the work which he was to perform and the other considerations adverted to, we do not think that there is presented a case which should demand the equitable interposition of the court.

The appellant, however, urges, and with much force, that though the court concluded upon the evidence that the plaintiff was not entitled to equitable relief, still, having the action for one purpose, and it being shown that damages resulted by reason of the defendant’s breach of the agreement, the court should have proceeded and ascertained the same, or sent the case to a referee or jury for that purpose.

This question has been many times presented, and we do not pretend to reconcile the cases; and, while there is seeming authority for the position taken by appellant, that it is within the power of the court, in an action in which both equitable and legal relief was sought upon the same state of facts, to retain the action and dispose of the question of the legal relief as though the action had originally been brought only for such relief, yet we find no case which goes to the extent of holding that the court, upon reaching a conclusion that no equitable relief should be accorded, must retain the action for such legal relief.

In determining the question as to when the discretion vested in the court should be exercised, we think it is properly employed by retaining the case for the purpose of affording legal relief in cases wbere at the time of the commencement thereof the facts warranted equitable relief and would have justified a decree in equity; and where, by reason of a change in facts or circumstances subsequent to the commencement of the action, such equitable relief is no longer necessary, or, upon the facts proved upon the trial, could not be granted. In such cases, the plaintiff, having properly brought his suit in equity, should not, by reason of subsequent events, be denied relief, it being a proper exercise of the discretion vested in the court to retain the action for the purpose of disposing of the question of legal relief in the manner provided for the trial of legal actions, thus saving the delay, labor and expense incident to the commencement of another action at law. On the other hand, where a suit is brought in equity and the evidence discloses the fact that at the commencement thereof the plaintiff was not entitled to any equitable relief, then the court, upon dismissing the equitable claim, can require that the plaintiff, for any other relief to which he may be entitled, must proceed in the ordinary way by an action at law.

Having concluded that the plaintiff was not entitled to the injunction prayed for, and that as to this part of the relief the complaint should be dismissed, the trial judge was not then obliged, even though a motion was made by the plaintiff to that effect, to send the case to the circuit court for trial, but could, as he did, dismiss the complaint without prejudice to an action at law.

We are of opinion that the judgment should be affirmed, with costs.

Van Brunt, P. J., concurs.

Barrett, J.

(dissenting)—I dissent upon several grounds: First. The learned judge at the special term should not have dismissed the complaint upon the ground that jurisdiction in equity was not shown when no such point was taken by counsel. The defendant moved to dismiss upon other grounds, and the learned judge, without passing upon these grounds, dismissed the complaint generally, assigning as a reason that the remedy was at law. Second. The defendant did not insist in his answer or suggest upon the trial that an adequate remedy at law existed. On the contrary, he treated the action throughout as properly an equitable one, and even demanded in his answer equitable relief as against the plaintiff. Third. Upon the case made by the pleadings and proofs, the contract was for the performance of personal services requiring special aptitude, skill and experience, for the breach of which an action at law would not have afforded the plaintiff an adequate remedy. The plaintiff’s revenue comes almost entirely from advertising. Hunt was an advertising solicitor, and he controlled this advertising to a large extent personally. This was because a large proportion of such advertising was obtained through his personal solicitation. He had been in the employ of Mr. Johnston, or the plaintiff, for several years, and he grew up, so to speak, with the journals which they published. The business was built up with Mr. Johnston’s or the plaintiff’s money, which was expended for Hunt’s salary and for his travel- • ing expenses when engaged in the business of soliciting advertisements. When Hunt notified Johnston that he was about to-leave, he said it was principally owing to his services that the-business was what it was, and that at least a portion of the business ought to belong to him. He at least must then have felt that-his services were “special, unique and extraordinary,” for he shamelessly demanded $10,000, and declared that if it was not paid he would break his contract, connect himself with another journal and take away half of the plaintiff’s advertising business. In his answer, Hunt did not deny the allegation of the plaintiff that—

“ By reason of his long connection with the plaintiff’s said newspaper he had become thoroughly familiar and well acquainted with the method of carrying on the plaintiff’s business, and specially with the method of carrying on his advertising business, and the methods of soliciting or securing such advertisements and with the customers or patrons of the said plaintiff.”

Mor did he deny that the knowledge which he possesses on the subject of this special advertising was acquired while in the employ of Mr. Johnston or the plaintiff.

In the same way he admits that his large and extensive acquaintance with the advertisers was formed by means of money furnished to him by Johnston, or the plaintiff, to enable him to secure for their benefit a business standing with persons, firms and corporations who needed to use the journal in question as an advertising medium.

His conduct in securing an advance of $4,000 in cash as an inducement to execute the new agreement under consideration, and in subsequently demanding $10,000 more as an inducement to be honest in fulfilling it, is properly characterized by Mr. Justice O'Brien. That, at least, "was certainly unique and extraordinary conduct, and it was based upon the undoubted fact. that his services were essential to the plaintiff and that no substitute could be readily obtained.

I think the facts in this case bring it fully within the principle enunciated in Strobridge Company v. Crane, 35 St. Rep., 473, which Mr. Justice O’Brien quotes and the authorities there referred to; and that the judgment should be reversed and a new trial ordered.

Judgment affirmed, with costs.