Carroll v. Giles

Citation9 S.E. 422,30 S.C. 412
PartiesCarroll v. Giles.
Decision Date23 March 1889
CourtUnited States State Supreme Court of South Carolina

Contracts—Restraint of Trade.

Plaintiff agreed to furnish for the defendant everything necessary to run a barhor-shop in a certain town, and the latter agreed not to do any work a? a barber for any one else, or to open a shop for himself in such town at any time, and to convey to plaintiff the patronage which had been extended to him. The proceeds of the business were to be equally divided between them. Held, that the stipulation of the defendant was an unrea-sonableone, and could not be specifically enforced.1

Appeal from common pleas circuit court of Marlboro county; Frasee, Judge.

Action by Hezekiah W. Carroll against John H. Giles. Judgment was rendered dismissing the complaint, and plaintiff appeals.

D. D. McCall and T. W. Boucher, for appellant. Townsend c6 McLaurin, for appellee.

McGowan, J. The plaintiff and defendant entered into a written agreement, the important part of which Was as follows: "Witnesseth that H. W Carroll, of the first part, hereby promises and agrees to furnish all furniture necessary to run a complete barber-shop.' Said H. W. Carroll agrees to pay all current expenses of the shop, including rents, washing, oil, materials to run the business, etc. The said John H. Giles, of the second part, promises and agrees to keep the business diligently, to do all the work necessary to run the shop, and keep the shop cleanly and in order, and to be responsible for the breakage of any or all furniture which may be placed in his care. He further agrees to collect charges for all work done, and to make a prompt and full settlement of the business, daily, to H. W. Carroll or his authorized agent, and to be personally responsible for all amounts charged or credited to any party or parties; and he furthermore agrees that, in consideration of the. shop being furnished for his use, he binds himself, and hereby agrees not to do any work, now or hereafter, outside of the shop owned by H. W. Carroll, or hire to any party or parties, or open a shop of any kind to carry on the barber business, either directly or indirectly, in Bennettsville, S. C. He hereby agrees to convey all patronage extended to him heretofore to the business owned by H. W. Carroll. We and each of us mutually agree to divide the gross receipts of the business equally between us, " etc. The defendant, Giles, worked for about one month in the shop of the plaintiff, and, becoming dissatisfied, he Page 423

brought to restrain a breach of contract, and therefore negative in the relief sought. (5) Because his honor erred in not holding that the contract was valid and binding, and that the plaintiff was entitled to an injunction to restrain a breach thereof. (6) Because his honor erred in not holding that the contract, being reasonable in its nature, limited as to locality, and for specific personal services, could be specifically enforced. (7) Because his honor erred in not holding that this was a case where there was no adequate remedy at law, and hence one peculiarly within the equity jurisdiction of the court, " etc. In respect to contracts which affect business relations, Mr. Pomeroy says: "It has been the policy of the law to promote the freedom of engaging in and carrying on all kinds of business which are beneficial to the public. * * * Contracts in general restraint of trade, whatever be their form, or the nature and immediate object of their stipulations, are void. * * * On the other hand, contracts in partial restraint of trade are valid. To this end they must be partial with respect to the territory included; reasonable with respect to the amount of territory, the circumstances and rights of the party burdened, and the one benefited by the restriction, and the number and interests of the public, whose freedom of trading is circumscribed; and made upon a valuable and sufficient consideration. The jurisdiction of equity is generally exercised in respect to these contracts for the purpose of indirectly compelling their specific performance by means of an injunction, " etc. 2 Pom. Eq. Jur. § 934. Such contracts are frequently made in connection with a sale of a business and good-will, the vendor stipulating that he will not carry on the same business within a specified distance from the old place and for a specified time, or will not solicit his old customers for his trade, and the like. These kinds of stipulations, if reasonable as to territory and time, will be enforced against the vendor, often by an injunction, as to negative stipulations especially. Mitchel v. Reynolds, 1 Smith, Lead. Cas. 705, and notes; 2 Pom. Eq. Jur. § 934, and authorities cited in the notes. "Sale of a business and good-will, and contract not to engage in the same business in a certain town for a certain time, held valid." Hedge v. Lowe, 47 Iowa, 137. "A contract not to carry on...

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