Armstrong v. W. T. Rawleigh Medical Co.

• Decision Date: 05 June 1915
• Docket Number: (No. 8209.)
• Parties: ARMSTRONG et al. v. W. T. RAWLEIGH MEDICAL CO.
• Court: Texas Court of Appeals

178 S.W. 582

ARMSTRONG et al. v. W. T. RAWLEIGH MEDICAL CO.

(No. 8209.)

Court of Civil Appeals of Texas. Ft. Worth.

June 5, 1915.

Rehearing Denied July 3, 1915.

Appeal from District Court, Somervell County; W. J. Oxford, Judge.

Action by the W. T. Rawleigh Medical Company against W. F. Armstrong and others. Judgment for plaintiff, and defendants appeal. Reversed and rendered.

Dean & Zweifel, of Granbury, and W. E. Myres, of Cleburne, for appellants. Estes & Estes, of Granbury, for appellee.

BUCK, J.

The W. T. Rawleigh Medical Company filed suit in the district court of Hood county against W. F. Armstrong, as principal, and three named parties, as sureties or guarantors, for debt, in the sum of $600, arising under the contract hereinafter set out. The court having sustained defendants' plea of privilege to be sued in the county of their residence, the case was transferred to the district court of Somervell county. From a judgment in favor of the plaintiff, in a trial before the court without the aid of a jury, the defendants appealed.

Plaintiff alleged that it was a private corporation, incorporated under the laws of Illinois, having its principal office and place of business at Freeport, Ill. and that on or about July 21, 1911, the defendants entered into the contract, a copy of which was alleged to be on file with the papers in the case, and under said contract it agreed to sell and deliver to defendant Armstrong, f. o. b. Memphis, Tenn., on credit and at wholesale prices, certain extracts, toilet articles, perfumes, etc., and that by the terms of said contract with Armstrong as principal, and the three named parties as sureties or guarantors, they promised to pay therefor and remit to plaintiff at such times and in such amounts as specified.

Defendants in their answer alleged that the written contract pleaded by plaintiff was in violation of the anti-trust laws of the state, to wit, chapter 1, tit. 130, arts. 7796, 7798, Vernon's Sayles' Texas Civil Statutes, and that, therefore, said contract was null and void, and that plaintiff could not recover thereunder.

In its supplemental petition plaintiff alleged that said shipment of goods was and came under the terms of interstate commerce, because plaintiff was a nonresident of the state of Texas and the defendants residents of said state, and that, therefore, the said laws of Texas did not apply to nor prohibit said contract.

In their three assignments of error appellants urge: First, that the court erred in overruling the defendants' general demurrer to plaintiff's petition, because the same stated no cause of action, in that the contract shows on its face that it undertakes to prevent competition in business, and shows that one of the parties to said contract should have no other business, occupation, or employment other than that specified in the contract, and that he was not permitted thereunder to purchase articles of merchandise from any person other than the other contracting party; second, that the court erred in overruling the defendants' special exception to the plaintiff's petition, because the contract as set out in said petition is in violation of the anti-trust laws of the state of Texas; and, third, that the court erred in rendering judgment in this case for plaintiff, inasmuch as the uncontradicted evidence shows that the contract between the plaintiff and defendant Armstrong, when construed in its entirety and taken in connection with the letters of instruction admitted in evidence, and with the booklet of instructions admitted in evidence, and the agreement limiting the said Armstrong to certain territory is a violation of the anti-trust laws of the state of Texas, and should not be upheld.

But in discussing the case we will confine ourselves to a consideration of the original contract as pleaded by plaintiff, and to which reference is made in its petition. This contract reads as follows:

"Whereas, W. F. Armstrong of Georges Creek, Tex., desires to purchase of the W. T. Raleigh Medical Company, of Freeport, Ill., on credit and at wholesale prices, to sell again on his own account to consumers, medicines, extracts, spices, soaps, toilet articles, perfumes, stock and poultry preparations, and other products furnished by it, paying his account for such goods in installments as hereafter provided:

"Therefore he hereby agrees to sell no other products than those sold him by said company, and to have no other business or employment.

"He further agrees to pay said company for all products purchased under this contract the current wholesale prices of such products, by remitting in cash each week to said company an amount equal to at least one-half the receipts from his business until his account is balanced, and, for that purpose, as evidence of good faith, he shall submit to said company weekly reports of his business; provided, however, if he pays his account in full on or before the 10th day of each month, he is to be allowed a discount of 3 per cent. (3%) from current wholesale prices. When the sale or purchase of products under this contract shall be permanently discontinued for any reason or upon notice given by either party, he further agrees to settle in cash, within a reasonable time, the balance due said company on account. Unless prevented by strikes, fires, accidents, or causes beyond its control, said company agrees to fill and deliver on board cars at place of shipment his reasonable orders, provided his account is in satisfactory condition, and to charge all products sold him under this contract to his account at current wholesale prices; also to notify him promptly of any change in wholesale prices.

"Said company further agrees to furnish him free of charge on board cars at place of shipment a reasonable amount of first-class advertising matter, report and order blanks, and printed return envelopes for his use; also to furnish him, free of charge, after he has ordered goods, suggestions and advice, through letters, bulletins, and booklets, as to the best methods of selling products purchased by him to consumers; but it is expressly agreed that nothing contained in such suggestions and advice shall be construed as in any way modifying the terms of this contract.

"This contract is subject to acceptance at the home office of the company, and is to continue in force only so long as his account and the amount of his purchases are satisfactory to said company: Provided, however, that said W. F. Armstrong or his guarantors may be released from this contract at any time by paying in cash the balance due said company on account.

                           "The W. T. Raleigh Medical Co
                     "[Seal.]   By W. T. Rawleigh, President
                                  "W. F. Armstrong
                

"[Salesman sign here in ink or indelible pencil.]

"Accepted July 21, 1911, at Freeport, Illinois.

"In consideration of the W. T. Raleigh Medical Company extending credit to the above-named person, we hereby guarantee to it, jointly and severally, the honest and faithful performance of the said contract by him, waiving acceptance and all notice, and agree that any extension of time shall not release us from liability under this guaranty.

"Responsible men sign below in ink or indelible pencil.

                   Names.         Occupation.    P. O. Addresses
                John C. Thomas.     Farmer.      Georges Creek
                W. B. Murphy.       Farmer.      Georges Creek.
                B. F. Parker.       Farmer.      Georges Creek.
                

"The above guarantors are entitled, upon request at any time, to a statement of principal's account.

"To insure prompt consideration of contract, names, occupations, and full addresses must appear plainly in above spaces."

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