The Hawaiian gazette., 1890-08-19
Supreme Court of the Hawaiian
Islands, In Equity.
THEo. II. DAWES, T. r. WALKER AND
T. M. SwANzY, COMPRISING THR
FIRM OF THEo. III. DAWES & Co.
VS.. w. H. DANIELS.
On APPEAL FROM MIR. JUSTICE M'oULLY.
SPECIAL TERM, JUNE, 1890.
BEFORE JUDD, c. j., M'CULLY BICKERToN,
AND DOLE, J. j.

nOG curing SuCn time OF Ill SdlQ area
engage in, or interest themselves in
carrying on or conducting mercan-
tile business, and if they or either of
them shall so engage in mercantile
business, they or he shall thereupon
forfeit and pay to the said party of the
second part, and his executors. admin
lstrators and assigns, one thousand
dollars"
Held; although the sum OF one thousand
dollars is liquidated damages, equity
has jurisdiction to enjoin the defen-
dant from committing breach of the
covenant, it not appearing that the
payment of the one thousand dollars
was an alternative which the vendor
(defendanD had the option to adopt in
lieu of strict performance of the con-
tract.
OPINION OF THE COURT BY JUDD, C. ].
Bill in equity filed oath February,
1890, to restrain defendant from en-
gaging in or carrying on or conduct
ing any mercantile business within
radius of five miles from the store
sold by him to E. A. Bielenberg in
Waikiki, Maui, until the expiration
of five years from the date of the
bill of sale, to wit, until July 22d,
1892;
On the 22d of July, 1887, the de-
PENDANT W. III. Daniels with W. II.
Cummings then doing business in
Waikiki, Maui, under the firm name
of daniels & Cummings" sold
their goods and merchandise to-
gether with the good will of the
business and the lease of the store
to one E. A. Bielenberg. The fol-
lowing covenant was included in the
bill of sale: "And for the consider
alton aforesaid, the parties of the
first part do hereby assign, transfer
and set over to the party of the sec
ond part, their goodwill in said
business for the term of five years
from the date thereof within radius
of five miles from said store, and
covenant that they will not during
such time or in said area engage in,
or interest themselves in carrying
on or conducting a mercantile bust
ness, and that if they or either of
them shall so engage in mercantile
business they or he shall thereupon
forfeit and pay to the said party of
the second part and his executors,
administrators and assigns, one
thousand dollars"
The bill alleges assignment of the
rights of Bielenberg under said cove
want and all causes of action to |
accrue under the same to the plain
tiffs, and violation of the covenant |
on the part of W. Fl. Daniels by his
carrying on and conducting a mer-
camille business in Waikiki within
five miles from said store since April,
1890.
The bill is demurred to and the
case turns upon the construction to
be given to the covenant above re-
cited.
Following Colby VS.. Bailey,
Haw'n. 1853, we are of opinion that
the sum of one thousand dollars
in the covenant is liqui-
dated damages and the plaintiffs
could recover this sum in an action
Of debt for a breach thereof and
would not be obliged to show the
specific damages sustained.
But there is nothing in the agree
nent to show that the payment of
ibis sum was an alternative which
5he vendor in the bill of sale had the
option to adopt and the payment, if
made, stands in lieu of the strict
performance of the agreement.
The cases usually cited in support
IF this proposition, that where the
sums mentioned appear to be liqui-
lated damages, the payment of them
will absolve the covenantor from
fulfilling his agreement are, like
Woodward VS.. Gyles, 2 Yer. 119,
where the defendant agreed not to
blow any part of the land demised,
and if he did, to pay twenty shil-
ings per acre; and it was held that
le had the privilege to pillow on pay
ng the additional rent, and the
Court refused to restrain him from
loing that which the contract pro-
7ided he might do.
The better and more modern doc
rine is, not that equity will not in
erfere to prevent party from doing
What he has agreed not to do when
iquidated damages are provided in
,ase he does the act, but that, as laid
Town in Ropes VS.. Upton, 125 Mass.
go, if the substance of the agree
nent is that the party shall not do a
particular act, and that is the evil
lent object and purpose of the
and it is provided that,
there is breach of the agreement,
he party shall pay a stated sum
which does not clearly appear to be
N alternative which he has the right
o adopt instead of performing his
ontract," equity will restrain him
rom doing the act
We adopt the arguments and con-
lusions of Rones VS.. linton. COM