Case ID: nys_21/html/0314-01.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

W. J. JOHNSTON CO., Limited, v. HUNT et al.
    (Supreme Court, General Term, First Department.
    December 16, 1892.)
    1. Injunction—Breach of Contract for Personal Services. Though a contract for the services of an advertising solicitor stipulates that he will not devote any part of his time or attention in the interests of, or to the advantage of, any person, corporation, or firm other than plaintiff, a court of equity will not interfere by injunction to prevent its breach by him, in the absence of a showing that he possessed special, unique, or extraordinary qualifications as such solicitor; and the fact that plaintiff’s paper lost some advertising by reason of his breach of the contract, and his entering into the services of a rival paper, is not sufficient to confer jurisdiction on a court of equity, since plaintiff has an adequate remedy at law for the breach. Barrett, J., dissenting.
    2. Same—Awarding Legal Belief after Denying Equitable. • Since plaintiff was not entitled to any equitable relief at the commencement of his action, the special term properly refused to retain it for the purpose of awarding him damages for the breach of contract, though that relief was also prayed for in the complaint, and properly remitted him to his action at law.
    Appeal from special term, New York county.
    
    Action by the W. J. Johnston Company,,Limited, against Walter T. Hunt and the Electric Age Publishing Company to restrain defendant Hunt from continuing in the service of the publishing company as an advertising solicitor. From a judgment dismissing the complaint, plaintiff appeals. Affirmed.
    Argued before VAN BRUNT, P. J., and O’BRIEN and BARRETT, JJ.
    
      Thomas J. Keigharn, for appellant.
    John Henby Hull, for respondents.
   O’BRIEN, J.

This action was brought to obtain an injunction restraining the defendant Hunt from working for the defendant the Electric Age Publishing Company in the capacity of an 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 Company “in the capacity of advertising solicitor, and to do similar work for five years from the 1st 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 his time or attention, during 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 a former agreement entered into between them, he induced the plaintiff to cancel the same, and further induced him to pay $4,000 in cash, and thereupon executed the agreement which it is now sought to enforce against him. Upon such a' state of facts, and concededly out of no consideration for the defendant Hunt, whose bad faith was made apparent, the learned trial judge dismissed plaintiff’s complaint upon the ground that the contract was of such a nature as not to entitle 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 N. Y. Super. 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 services, or whether the complainant must look to his damages at law as his sole redress. This case, (Daly v. Smith,) as well as all the 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 services 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 3 Pom. Eq. Jur. § 1343, “a ■contract stipulates for special, unique, or extraordinary 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 Lithographing Co. v. Crane, (Sup.) 12 N. Y. Supp. 898:

“It may sometimes be difficult to say just what is a special, unique, and extraordinary service, or whether the employe possesses special, unique, or extraordinary qualifications. The solution may generally be reached by the inquiry as to whether a substitute for the employe can readily he 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 the 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 agreements, 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 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 was 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 legal relief as though thé action had originally been brought pnly for such relief,—yet we find no case which goes to the extent of holding that the court, upon reaching the 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 where, at the time of the commencement thereof, the facts warranted legal 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 all 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 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.

I dissent upon several grounds: First. The learned Judge at 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 rplief 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 of 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 of the plaintiff’s money, which was expended for Hunt’s salary,, and for his traveling expenses when engaged in the business of soliciting advertisements. When Hunt notified Johnston that he was about to leave, he said that 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 complaint 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 especially with the methods of carrying on its advertising business, and the methods of soliciting or securing such advertisements, and with the customers or patrons of the said plaintiff. ”

Nor 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 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 úse 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 readily be obtained. I think the facts of this case bring it fully within the principle enunciated in Lithographing Co. v. Crane, (Sup.) 12 N. Y. Supp. 898, which Mr. Justice O’BRIEN quotes, and the authorities there referred to; and that the judgment should be reversed, and a new trial ordered.