Driver-Harris Wire Co. v. Driver

• Decision Date: 03 October 1905
• Parties: DRIVER-HARRIS WIRE CO. v. DRIVER.
• Court: New Jersey Court of Chancery

62 A. 461

70 N.J.E. 34

DRIVER-HARRIS WIRE CO.

v. DRIVER.

Court of Chancery of New Jersey.

Oct. 3, 1905.

Suit by the Driver-Harris Wire Company against William B. Driver. On exceptions to the answer to the supplemental bill. Sustained.

Edward A. Day, for complainant. Alfred F. Stevens, for defendant.

PITNEY, V. C. I am asked to give my reasons, for the purposes of appeal, for sustaining the exceptions to the answer to the supplemental bill. The object of the original bill, filed May 15, 1905, was to enforce by preventing the breach by the defendant of a contract entered into between the parties hereto on the 16th of February, 1905, and consummated on or about the 5th of April, 1905. The defendant was the president of the complainant corporation and largely interested in its capital stock, and by the agreement he conveyed to complainant all his stock for the sum of $60,000, payable in installments, as specially provided in the agreement. Then follows an agreement on the part of the defendant that he will not "for a period of fifteen years, from April 1st, 1905, engage directly or indirectly, or concern himself in carrying on or conducting the business of making or selling resistance or steel armature binding wire, sheet or strip, or any brass or copper wire, sheet or strip or so called Antique Bronze wire, or Bronze wire made approximately of seven (7) per cent of tin and ninety-three (93) per cent. of copper and imported from Germany, in competition with the business of the said company in" certain of the states of the United States. Then follows this further clause: "But the party of the first part has the privilege of experimenting in the making of the above mentioned goods at his own expense, and if the products and results resulting from such experiments shall meet the approval of the said company, then the said company shall furnish the machinery and labor for the manufacture of such goods, and the party of the first part shall pay the expense of selling the said goods, and the profits thereon after paying for the raw material shall be divided equally between the said wire company and the party of the first part, It being understood that the party of the first part shall have the right to fix and determine the selling prices for said goods; but if the said company does not approve the said goods and is unwilling to manufacture them on the terms above stated, then the party of the first part may make and sell such goods on his own account, and agrees to pay ten (10) per cent. of the selling price to the said wire company, rendering a full and true account of all sales every six months to the said company. It being understood that all inventions, discoveries, developments and improvements growing out of the experiments of the said party of the first part shall belong to him and that the said company shall not attempt to infringe the same; and that the wire company will not experiment or attempt improvements in alloys for resistance wire, sheet or strip during the term of this agreement unless the party of the first part shall have abandoned his experiments in the making of such alloys and shall have so notified in writing the wire company. And the said wire company, in consideration of the sale of said stock as herein provided, and in consideration of the party of the first part refraining from competition as above provided, hereby agrees to pay to the said party of the first part the sum of twenty five hundred ($2,500) dollars per annum for ten (10) years from April 1st 1005, in semi monthly installments, and the party of the first part agrees that he will do all in his power to assist the welfare of the said company by advice regarding business methods and customers at any time that he is consulted by the wire company or its officers." The bill charged specific breaches of this agreement commencing almost immediately after the 5th of April, 1905. An answer was filed on the 13th of June. Affidavits were annexed to each, and arguments were had thereon.

The supplemental bill was filed September 11, 1905, and the answer to it on September 20th. Exceptions were immediately filed to this answer for insufficiency, were promptly brought to hearing, and sustained on the 3d of October. The answer to the original bill and statements and admissions by counsel at the argument informed the court as to the meaning of the technical words used in the contract. The supplemental bill recites the original bill and...