Court Opinion

ID: 5260324
Source: CourtListenerOpinion
Date Created: 2022-01-06 18:40:51.072247+00
Date Added: 2024-06-11T08:28:04.335053
License: Public Domain

Page, J.:
The' defendant sold his business to plaintiff, and in said agreement covenanted that he would not directly or indirectly as employer, employee or otherwise engage in or be connected with a business similar to the kind to be sold to the plaintiff for a period of five years from the 4th day of May, 1920, within a radius of fifty square blocks from the said address of 1484 Fifth avenue, Manhattan. The defendant violated this covenant and the plaintiff brought an action for an injunction and obtained an injunction pendente lite: Thereafter the defendant continued his violation. The court has found that such violation did defeat, impair, impede or prejudice the rights or remedies of the plaintiff.
This being a civil contempt and the plaintiff having failed to prove any actual damage from the violation of the injunction order, the court was empowered by section 773 of the Judiciary Law to impose a fine not exceeding the amount of the plaintiff’s costs and expenses and $250 in addition thereto. (Socialistic Co-operative Pub. Assn. v. Kuhn, 164 N. Y. 473, 475.)
The learned justice at Special Term was probably misled by a provision in the contract. that a deposit was to be made by the defendant of $1,000 as security for the faithful performance of the contract, which on a violation of the contract should be taken as liquidated damages. That provision of the contract precedes the covenant not to engage in business and reads: “ In the event that said party of the first part shall not faithfully perform the aforesaid conditions, it is agreed between the parties hereto that a certain sum of One thousand ($1,000) Dollars,” etc. Therefore, that sum cannot be taken as the fixed and liquidated damages for the violation of this injunction order.
The order should, therefore, be modified by reducing the fine to $250 and costs, and as modified affirmed.
Clarke, P. J., Dowling, Smith and Greenbaum, JJ., concur.
Order modified by reducing fine to $250 and costs, and as so modified affirmed, without costs.