Beekman v. Marsters

• Decision Date: 06 April 1907
• Parties: BEEKMAN v. MARSTERS.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

195 Mass. 205

80 N.E. 817

BEEKMAN v. MARSTERS.

Supreme Judicial Court of Massachusetts, Suffolk.

April 6, 1907

COUNSEL

George R. Nutter, Harrison F. Lyman, and Brandeis, Dunbar & Nutter for complainant.

Clarence W. Rowley, for respondent.

OPINION

LORING J.

This suit came before the single justice on the report of a master to which no exceptions had been taken by either party, and was reserved by him for our consideration and determination without any ruling or decision having been made.

The master found that on November 21, 1906, a contract was made between the plaintiff and the Jamestown Hotel Corporation. The Jamestown Hotel Corporation is a corporation which is erecting or has erected a hotel within the grounds of the Jamestown Exposition to be held between April 26th and November 30th of this year. This hotel is known as the 'Inside Inn,' and is to be the only hotel within the exposition grounds. The plaintiff is the proprietor of a tourist agency, having an office at 293 Washington street, Boston. By the contract between the plaintiff and the hotel corporation the plaintiff agreed to represent the hotel corporation throughout the New England states, to establish subagencies in that territory, and to use every possible endeavor personally and through his agents to book persons for the Inside Inn; and the defendant agreed 'that you [the plaintiff] shall be out exclusive agent in said territory,' to pay him [the plaintiff] 25 cents a day for each person sent by him to the hotel, and to furnish the plaintiff with all necessary 'literature.'

Immediately upon being thus appointed the exclusive agent of the hotel corporation the plaintiff prepared and issued a fall edition of his 'Tickets and Tours,' in which inter alia a description is given of the Jamestown Exposition had of the Inside Inn. Following this is the statement that the plaintiff has been appointed New England agent for the exposition 'and exclusive representative of the Inside Inn.'

The defendant is found by the master to be a ticket and tourist agent, with an office at 298 Washington street, Boston. On January 11, 1907, he went to Norfolk, Va., and called upon the officers of the hotel corporation there. At this time he 'had seen the contract between the complainant and the hotel corporation, but had not read it, and knew that the company had practically consummated a contract making Beekman its sole representative in New England.' The defendant at this interview told these officers 'that it was a mistake for the corporation to give an exclusive agency in New England to any one man, and that more business would be brought to the company if all agents were given equal terms,' and to enforce his arguments stated that the business done by the plaintiff was insignificant and that the statement was false which was made in the summer edition of his 'Tickets and Tours' that certain persons therein named had his tickets and tours for sale. It appeared that the summer edition of this catalogue had been shown to the hotel corporation by the plaintiff when he made his contract with it.

The master found that 'as a result of the solicitations or representations made by the respondent, the Jamestown Hotel Corporation on or about January 11, 1907, entered into an oral cortract with him, whereby it was agreed that the respondent should have the same rights that had been given to the complainant, and that he should be paid by the corporation 25 cents per capita per day for each guest whom he should secure for the Inside Inn.'

The defendant then wrote to all men named in the plaintiff's catalogue except those having places of business in Canada, 'and two or three others who appeared to have an independent agency business,' telling them that the plaintiff had not an exclusive agency for New England and suggesting to them that they could get paid on the same footing as that upon which the plaintiff and defendant were to be paid, if they chose to act for themselves and not as subagents of the plaintiff. He also wrote to the New York, New Haven & Hartford Railroad Company, calling attention to the fact that some of the local ticket agents of that railroad company were advertised by the plaintiff as having his tickets and tours on sale, and suggesting that the railroad company would prefer to have all its agents strictly neutral in dealing with tourist concerns.

With respect to these letters the master made this finding: 'The purpose of the respondent in sending the letters above mentioned appears from the letters themselves. I do not find that the respondent was actuated by malice toward the complainant.'

The master further found that 'the Jamestown Hotel Corporation has never at any time rescinded, or attempted to rescind, its said contract with the complainant'; that 'the complainant has never waived any of his rights under the contract, and has never consented to any modification or alteration thereof except with reference to the bond' which is not material; and further, that 'the Inside Inn is the only hotel which is located, or, under the contract of the company with the exposition, can be located, within the exposition grounds. The exclusive right to act as agent for the Inside Inn within the New England territory is a valuable right.'

Lastly he has found: 'There is a strong probability that a large tourist business will be done between Boston and New England and the Jamestown Exposition between April and the close of the exposition in November, and that many passengers will arrange for tours through various tourist agencies. In all probability many more passengers will buy tours and tickets from the complainant if he is the exclusive agent in New England for the Inside Inn than will be the case if other tourist agents also book guests or issue coupons or other devices which are accepted by the hotel corporation for accommodations. The damage which he will sustain if the respondent or other persons are allowed to act as agents or to book guests or issue coupons in this manner is incapable of accurate ascertainment. The loss to the complainant will not be merely the loss of the commission of 25 cents per capita per day, which would otherwise be received from the hotel, but it will be the loss of profits on tours which he might otherwise be able to arrange.'

The result of the findings of the master must be taken to be that the defendant induced the hotel corporation to break its contract with the plaintiff, but that it did not do this to spite the plaintiff or for the purpose of injuring him, but for the purpose of setting for himself (the defendant) business which the plaintiff alone was entitled to under the contract with the hotel corporation, that is to say, to get business which the defendant could not get if the hotel corporation kept its agreement with the plaintiff.

Three defenses have been set up by the defendant, namely: First, that he had a right to do what he did; second, that the plaintiff does not come into court with clean hands; and, third, that the plaintiff has an adequate remedy at law by bringing an action for damages.

1. So far as the first defense is concerned, it is in effect that where A. is under a contract to serve the plaintiff for a specified time, the defendant, knowing that contract to be in existence, is justified in hiring A. away from the plaintiff before the expiration of that time, by giving him (A.) higher wages if he (the defendant) thinks that to be for his (the defendant's) pecuniary benefit. The ground on which the defendant bases this contention is that he has a right to compete with the plaintiff and that the right of competition is a justification for thus hiring away the plaintiff's servant.

We say that this is in effect the defense set up here because it has been settled in Massachusetts that there is no distinction between a defendant's enticing away the plaintiff's servant and a defendant's inducing a third person to break any other contract between him and the plaintiff. That was decided by this court in Walker v. Cronin, 107 Mass. 555. See page 567. See, also, Moran v. Dunphy, 177 Mass. 485, 59 N.E. 125, 52 L. R. A. 115, 83 Am. St. Rep. 289. In other words, this court there adopted the conclusion reached by the majority of the judges of the Queen's Bench in Lumley v. Gye, 2 El. & Bl. 216. This is also th settled law of the Supreme Court of the United States. Angle v. Chicago, St. Paul, etc., Ry., 151 U.S. 1, 14 S.Ct. 240, 38 L.Ed. 55. And it has been affirmed in England. Bowen v. Hall, 6 Q. B. D. 333; Read v. Friendly Society of Operative Stonemasons, [1902] 2 K. B. 88; Glamorgan Coal Co., Limited, v. South Wales Miners' Federation, [1903] 2 K. B. 545; s. c. on appeal, sub nomine South Wales Miners' Federation v. Glamorgan Coal Co., Limited, [1905] A. C. 239.

No case has been cited which holds that a right to compete justifies a defendant in intentionally inducing a third person to take away from the plaintiff his contractual rights.

Not only has no case been cited in which that has been held, but no cases has been cited in which that contention has been put forward.

It happens, however, that Judge Wells in defining the rights of competition has denied the existence of such a justification. In discussing the first count in Walker v. Cronin, 107 Mass. 555, 564, he said: 'Every one has a right to enjoy the fruits and advantages of his own enterprise industry, skill and credit. He has no right to be protected against competition; but he has a right to be free from malicious and wanton interference, disturbance or annoyance. If disturbance or loss come as a result of competition, or the exercise of like rights by others, it is damnum absque injuria, unless some superior right by contract or...