Borley v. McDonald

• Decision Date: 31 January 1897
• Citation: 38 A. 60,69 Vt. 309
• Court: Vermont Supreme Court
• Parties: BORLEY v. McDONALD.

38 A. 60

69 Vt. 309

BORLEY

v. McDONALD.

Supreme Court of Vermont. Franklin.

Jan. Term, 1897.

Exceptions from Franklin county court; Ross, Chief Judge.

Assumpsit by Isaac S. Borley against James McDonald. Heard on report of referee and exceptions thereto. Exceptions overruled, and judgment for plaintiff for $500, as liquidated damages, with interest from date of writ. Defendant excepts. Affirmed.

Wilson & Hall, for plaintiff.

Farrington & Post, for defendant.

TYLER, J. It appears by the referee's report that the plaintiff had a large, well-established, and profitable fire, life, and accident insurance business in St. Albans, representing 23 or more companies; that in the spring of 1888 the defendant entered his employment as a clerk in his insurance office; and that on October 28, 1889, while he was so employed, the parties entered into the following written contract with each other: "In consideration of the agreement of the said McDonald hereinafter contained, said Borley agrees to employ him, the said Mcdonald, in his insurance business for the term of one year from the 21st day of October, 1889, unless this contract is sooner determined by its terms or by agreement, at and for the sum of not less than fifty dollars per month, payable at the end of each and every month. And the said McDonald agrees for himself, his heirs and assigns, that, in consideration of said salary of not less than fifty dollars a month, he will devote his time and energies to the insurance business of said Borley, eight hours each day, in such part of said insurance business as said Borley shall direct; and that, in case of the determination of this agreement by its terms, by limitation, or for any cause, he will not, in the town of St. Albans, directly or indirectly, for the period of one year from the conclusion of service under the contract, solicit any insurance that shall at that time be held by said Borley from any party or parties whatsoever; and that he will not do any act or thing in advantage of the said Borley by reason of information gained in his services; and, in case said McDonald shall violate this provision of this agreement, he hereby agrees for himself, his heirs, executors, administrators, and assigns, to forfeit and pay to said Borley the sum of five hundred dollars as liquidated damages, to be recovered in an action of assumpsit; this contract to control as to the amount of damages. It is further stipulated and agreed that, in case either party shall be dissatisfied with the other, this contract may be determined, so far as service and compensation are concerned, by giving notice to the other party, in writing." The defendant had no previous knowledge of the insurance business, but, for some time before he left the plaintiffs service, he had been the general manager of the business, and had access to and knowledge of the insurance registers and other books kept by the plaintiff. He remained in the plaintiff's employment under the contract from its date until August 28, 1890, when, for reasons not stated, the plaintiff discharged him. September 25, 1890, the defendant, A. D. Tenney, and S. S. Watson formed a partnership for the purpose of carrying on a like insurance business, as equal partners. They bought an established business in St. Albans, and have ever since prosecuted it, under the firm name of Tenney & Watson, their business being in active competition with the plaintiff's. The plaintiff considered that the defendant's entering into this partnership was in violation of the contract, and that he bad otherwise broken it, and in January, 1891, brought a bill in equity against him, and procured an injunction, by which the defendant was enjoined from directly or indirectly prosecuting insurance business, in violation of the written contract. Subsequently proceedings were instituted against the defendant for an alleged violation of the injunction. The matter was' referred to a master, who reported the facts to the court, whereupon the court of chancery, at the September term, 1891, for...