Associated Newspapers v. Phillips

• Citation: 294 F. 845
• Decision Date: 19 November 1923
• Docket Number: 151.
• Parties: ASSOCIATED NEWSPAPERS v. PHILLIPS.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

294 F. 845

ASSOCIATED NEWSPAPERS v. PHILLIPS.

No. 151.

United States Court of Appeals, Second Circuit.

November 19, 1923

Taylor Jackson, Brophy & Nash, of New York City (Charles B. Brophy of New York City, of counsel), for appellant.

Kellogg Emery, Inness-Brown & Cuthell, of New York City (Dean Emery and J. Fearon Brown, both of New York City, of counsel), for appellee.

Before ROGERS, HOUGH, and MANTON, Circuit Judges.

ROGERS Circuit Judge.

This is an appeal from an order enjoining the defendant pendente lite from disposing of his newspaper writings to any one except the complainant herein. The order was signed on July 30, 1923. It restrains the defendant from--

'publishing, selling, offering for sale, disposing of, or permitting the publication, either in the city of New York and vicinity, or elsewhere in the United States or Canada, of humorous articles or 'columns' of other literary matter to be used in newspapers or other periodicals, or by newspaper or other syndicates, other than the complainant herein and/or those newspapers receiving the newspaper syndicate service of the complainant, or from accepting any employment whatsoever, other than from the complainant herein, by which he shall supply or agree to supply such articles, and that the defendant be and he hereby is enjoined and restrained, pending the determination of the issues herein, from doing or permitting anything to be done directly or indirectly to the prejudice of the exclusive rights which the complainant is entitled to enjoy under its aforesaid contract with the defendant, described in the bill of complaint herein. * * * '

The complainant bases its claim to equitable relief upon an agreement which it had with the defendant for his exclusive services, and upon its further claim that the services so contracted for are of such a unique and distinctive character that they cannot be duplicated or replaced by the work of any other writer.

The complainant is a New Jersey corporation, which was incorporated in 1911. It was incorporated by the publishers of the Chicago Daily News, the Boston Globe, the Philadelphia Bulletin, and the New York Globe. It secures by contract the exclusive services of special writers, cartoonists, and other contributors of what are known as newspaper 'features,' and sells the use of such 'features' to newspapers throughout the country. It would be quite beyond the means of most of the newspapers to purchase the output of these popular writers for exclusive use in one newspaper, whereas the syndicate makes it possible for smaller papers to avail themselves of these features at moderate cost through the syndicate. The complainant supplies its service to more than 40 newspapers throughout the United States and Canada.

The defendant resides within the Eastern district of New York, and was employed in 1918 by the New York Globe and Commercial Advertiser to edit copy. In 1920, or thereabouts, he commenced to contribute humorous paragraphs to the paper in addition to his work of editing copy. After a time he was directed to devote himself exclusively to these humorous productions, and they appeared daily in that newspaper. For more than a year immediately preceding January 9, 1922, he sold the use of these articles so appearing in the Globe to certain papers published outside of New York City, not members of the complainant association; and in the fall of 1920 the complainant obtained from the publishers of the Globe permission to syndicate his articles, but the complainant did not pay him for these articles prior to 1921, when it commenced paying him for their use by its members outside of New York City. But on January 9, 1922, the complainant and defendant signed the following paper: 'The Associated Newspapers, 114 Liberty St., New York.

'Jan. 9, 1922.

'Mr. H. I. Phillips, The Globe, New York City-- Dear Mr. Phillips: In view of the fact that you are a regular daily contributor to the New York Globe, one of the directing members of the Associated Newspapers, and that you wish to place your articles in open territory outside, it is understood and agreed that the Associated Newspapers is to have the right to include your daily feature in its general service, and that the Associated Newspapers is to pay you at the rate of $75 a week during the year 1922 for the exclusive rights to your newspaper work outside of New York City. It is understood that you will supply us with six articles per week.

'In the event that the New York Globe ceases to pay you less than $150 a week in its account at any time during the year 1922, the Associated Newspapers is to have the option on your exclusive newspaper work, at the rate of $225 per week.

'It is understood and agreed that you grant to the Associated Newspapers a similar option for the years 1923 and 1924.

'Your acceptance of this letter will, we take it, constitute a proper agreement between us.

'Very sincerely yours,

(Signed) H. H. McClure, Gen'l Mgr.

'Accepted: H. I. Phillips.'

The sale of the Globe was announced in May, 1923, and the defendant began to look for another situation, which he obtained on the staff of the New York Evening World-- his employment to commence on June 4, 1923, which was two days after the Globe ceased publication. On June 1, 1923, the general manager of the complainant wrote to the defendant in part as follows:

'I do not understand that the Globe has declined to continue its present arrangement with you. My information is that you have seen fit to contract with the New York World without the consent of the Globe and in disregard of your contract relations with them.

'The Associated Newspapers, therefore, claims, and it hereby exercises, the option of your exclusive newspaper work, inside as well as outside the city of New York, at the rate of $225 per week for the balance of 1923 and 1924.'

The defendant, however, entered upon his employment with the Evening World, furnishing it six articles a week, and the complainant brought this suit and moved for an injunction pendente lite. It is from the order granting that injunction that this appeal is taken.

The defendant contends that the first paragraph of the letter of January 9, 1922, already set forth in this opinion, did not constitute a valid binding contract of employment for that year, but was one which could have been terminated at any time by either party; in other words, that if it is a contract of employment at all, as distinguished from a sale of his articles for publication outside of New York City, it was merely a hiring at will, there being no words of employment and no fixed period of employment. We cannot accede to this view of the contract. Where a person agrees to render services to another, without any agreement as to the duration of the services, the indefinite hiring is presumed to be a hiring at will, in the absence of evidence of custom, or of facts and circumstances showing a contrary intention on the part of the parties. Truesdale v. Young, Fed. Cas. No. 14,204; Martin v. New York Life Ins. Co., 148 N.Y. 117, 42 N.E. 416, affirmed 73 Hun, 496, 26 N.Y.Supp. 283, Graves v. Lyon Bros. & Co., 110 Mich. 670, 68 N.W. 985; Kane v. Moore, 167 Pa. 275, 31 A. 631.

But in this case there was an express agreement as to the duration of the service; it being expressly stated that it was 'during the year 1922.' And where one enters into another's service for a definite period, and continues in the employment after the expiration of that period without any new agreement, the legal presumption is that the employment is continued on the terms of the original contract, unless facts are proven which are sufficient to rebut that presumption. Adams v. Fitzpatrick, 125 N.Y. 124, 26 N.E. 143; O'Connor v. Briggs, 182 Mass. 387, 65 N.E. 836; Crane Bros. Mfg. Co. v. Adams, 142 Ill. 125, 30 N.E. 1030. And in the instant case the evidence shows that without any new agreement the parties continued their contractual relations during the first five months of 1923 on the same basis which existed between them during the year 1922. The claim that the defendant's contract was at will is contradicted by the defendant himself in his own affidavit, submitted in opposition to the motion for an injunction. In that he says:

'The only period during which the complainant association had any contract with me other than on a week to week basis was confined to the period from January 9, 1922, to the end of that year.'

As the contract for 1922 was a contract for a year, and at the end of the year the parties continued under it, as before, the contract for 1923 was also a contract for a year.

It is also impossible to accede to the suggestion that the contract is not one of hiring, but is a contract of sale. The writings which the defendant agreed to furnish to the complainant were 'six articles per week.' There is nothing in the contract or in the record which shows that the writings or articles which the defendant was to furnish were in existence at the time the contract was signed. On the contrary, the record discloses that what he did was to take the news of the day and make fun of it, in a way that appealed to the reader's sense of humor. In the nature of things it was not possible for the kind of articles he wrote to be prepared in advance. In every sale the seller transfers the property in the goods for a consideration called the price, and in every contract to sell the seller agrees to make the transfer for the consideration agreed upon. In Mead v. Case, 33 Barb. 202, the Supreme Court of New York had before it an agreement to furnish the defendant a monument to be placed in a cemetery. At the time the agreement was made the stone existed in the general form which the defendant desired. What...