Court Opinion

ID: 5185168
Source: CourtListenerOpinion
Date Created: 2022-01-06 04:47:23.995506+00
Date Added: 2024-06-11T08:26:43.186090
License: Public Domain

McLaughlin, J. (dissenting):
A contract not to engage in business is not in restraint of trade so long as it is only co-extensive with the interest sought to be protected, but when the covenant goes beyond this and thereby becomes oppressive to one of the parties without conferring a corresponding benefit upon the other, then such covenant is said to be unreasonable and injurious to the public interests and, therefore, invalid. •(Diamond Match Co. v. Roeber, 106 N. Y. 473; Saratoga Co. Bank v. King, 44 id. 87; Ward v. Byrne, 5 M. & W. 548; Consumers' Oil Co. v. Nunnemaker, 142 Ind. 560; Bishop v. Palmer, 146 Mass. 469; Taylor v. Saurman, 110 Penn. St. 3; Davies v. Davies, L. R. [36 Ch. Div.] 359; Maxim Nordenfelt Co. v. Nordenfelt, 68 L. T. Rep. [N. S.] 833.) Applying this principle to the contract under consideration, it seems to me clear that the defendant’s covenant “ not to enter into business in the same or similar line for the term of ten years ” is invalid. The business sought to be protected is local in its character while the covenant is general. The prevailing opinion seems to concede that the covenant in this contract is invalid if read literally ; but it is insisted that it does not in fact express what the parties intended, and that, therefore, it should be read as though the defendant had agreed not to enter into the same or a similar business in competition with the plaintiffs for ten years, and that when the words “in competition with” are understood and implied, then the locality of the business, namely, the city of Rew York, is equally understood and implied, and thus the covenant of space limited to the locality where the competition is possible. But the covenant in this contract is expressed in plain terms. It is not ambiguous, and we have no right to assume, such being the fact, that anything was intended by the parties except what a fair construction of the language itself implies. The court has no right to take from or add to the contract, and to do so is simply to make a new contract for the parties instead of construing one which they have made.
This contract is not in partial restraint of trade, and it cannot be saved upon that ground. It is general in its terms and absolutely prohibits the defendant from engaging in the same or a similar business in any place whatsoever for the term of ten years, and there is absolutely nothing in the contract or in the papers before us which *420warrants the assumption that it was intended to apply only to the city of New York. Such construction can only be placed upon it by inserting words not therein used, and giving to the covenant a-meaning and purpose not expressed in it and which cannot fairly or reasonably be implied from it. The respondents’ attorney, as appears from the brief tiled on the argument before us, insists that the parties intended that the covenant should apply to the boroughs of “ Manhattan, Bronx, Brooklyn, Queens and Richmond; ” the court, below enjoined the defendant from doing business at any place in the “ borough of Manhattan,” while in the judgment of this court,, as appears from the prevailing opinion, the defendant should be enjoined from doing business in the city of New York. These different views simply illustrate the futility of an attempt to construe; the contract upon the assumption that certain words not expressed in it are to be understood and implied from it. I think the contract-expressed just what the parties intended, and my view in this respect is strengthened by the fact that the defendant had customers in several States who were in the habit of sending him farm produce to-be sold on commission, and to secure these customers for the plaintiff the covenant in question was inserted in the contract to absolutely prohibit the plaintiff from engaging in the same or a similar-line of business for the time specified. In all cases in which contracts in restraint of trade have been held invalid the covenant-might have been sustained if the courts had adopted the -reasoning-of the learned justice writing the prevailing opinion. The purpose-of this covenant was to. prevent competition, and in trying to do this-' the parties went too far. The covenant is oppressive to the defendant and does not confer a corresponding benefit upon the plaintiff;. and, therefore; under the rule above stated and under every well-considered decision which I have been able to find, it must be held to-be invalid.
Eor these reasons I am unable to concur in the opinion of Mr. Justice Baerett.
- Order affirmed, with ten dollars costs and disbursements.