Craft v. Mcconoughy
| Decision Date | 30 September 1875 |
| Citation | 1875 WL 8633,22 Am.Rep. 171,79 Ill. 346 |
| Parties | RICHARD C. CRAFT et al.v.JAMES O. MCCONOUGHY. |
| Court | Illinois Supreme Court |
OPINION TEXT STARTS HERE
WRIT OF ERROR to the Circuit Court of Ogle county; the Hon. W. W. HEATON, Judge, presiding.
Mr. M. D. HATHAWAY, Mr. WILLIAM BARGE, and Mr. SHERWOOD DIXON, for the plaintiffs in error.
Mr. JAMES K. EDSALL, for the defendant in error.
This was a bill in equity, brought by James O. McConoughy against Richard C. Craft and others, for an account and distribution of the profits of an alleged partnership claimed to have existed under a written contract, to the following effect:
“Articles of agreement made and entered into this 20th day of April, A. D. 1869, between the following persons, viz: E. P. Sexton, Dr. John McConoughy, C. B. Boyce, R. C. Craft and William Wiswell, for the purpose of systematically pursuing the grain trade in Rochelle, and for mutual protection against losses. The said parties covenant and agree to enter into the grain trade for one year from this date, upon the following terms: Our several grain houses shall be put into the business upon the basis of twenty-seven shares as the aggregate, divided as follows: C. B. Boyce and R. C. Craft shall be entitled to nine shares, E. P. Sexton to six shares, J. McConoughy to six shares, and William Wiswell to six shares. Each separate firm shall conduct their own houses as heretofore, as though there was no partnership in appearance, keep their own accounts, pay their own expenses?? ship their own grain, and furnish their own funds to do business with; a list of all the grain purchased by each firm to be made every day and handed to the general bookkeeper, with amounts paid for the same; also every car shipped to be reported at the time?? and every account of sale to be handed in to said bookkeeper, as well as all sales made at the warehouse from time to time. It shall be the duty of the bookkeeper to make a faithful record of all the grain bought by each party, the amount of money paid for the same, and place to his debit, and also to credit him with all account of sales, as well as any transactions made at the warehouse, and, at the end of every month, each individual's account to be balanced, showing the profits or loss, which amount is to be divided pro rata, according to the number of shares held by each party. It is further agreed, that there shall be no grain held for advance in price, or for any other cause, by any of the above named parties.
Prices and grades to be fixed from time to time, as convenient, and each one to abide by them. All grain taken in store shall be charged one and a half cents per bushel, monthly; but if sold inside of thirty days, no storage to be asked. No grain to be shipped by any party at less than two cents per bushel.”
In November following the execution of the agreement, John McConoughy died, and it is the theory of the bill that the complainant, who was his son, by mutual consent came in and took his place under the contract.
It is set up in the answer, that the contract was made in restraint of trade, and is against public policy, and void; that all transactions with complainant or with his father and defendants, under or in pursuance of it, and under the alleged arrangement with complainant after the death of his father, were in restraint of trade, against public policy, and void.
Two questions arise upon the record: First, whether the contract set out in the bill is void. Second, if illegal and void, will a court of equity, after it has been executed, require one of the parties to account to another for a portion of the gains arising under the contract?
Prior to and up to the time of the execution of the agreement set out in the bill, the four parties were engaged in the grain business in the town of Rochelle, each one on his own account, and in competition with each other, but, after the agreement was executed, all competition ceased. All the warehouses in the city, and every lot suitable to erect a warehouse upon, were controlled by the combination. Some were purchased and others leased, so that the combination formed effectually excluded all...
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...public; it is enough to know that the inevitable tendency of such contracts is injurious to the public.' So, in Craft v. McConoughy, 79 Ill. 346, 350, 22 Am. Rep. 171, 174, which was the case of a combination among grain dealers by which competition was stifled, the court saying: 'So long a......
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...means by which that object was to be accomplished. 36 Pittston & Elmira Coal Co., 68 N.Y. 558, 565-67 (1877); Craft v. McConoughy , 79 Ill. 346, 350-51 (1875); and Richardson v. Buhl, 77 Mich. 632, 658, 43 N.W. 1102, 1110 (1889). Senator Sherman discussed these decisions in floor debate on ......
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