Edlis, Inc. v. Miller
| Decision Date | 14 December 1948 |
| Docket Number | CC732. |
| Citation | 51 S.E.2d 132,132 W.Va. 147 |
| Parties | EDLIS, Inc. v. MILLER et al. |
| Court | West Virginia Supreme Court |
Syllabus by the Court.
1. A permanent preventive injunction awarded by a final decree is a continuing process of which a court of equity retains jurisdiction for the purpose of modifying or vacating the injunction when equity no longer justifies its continuance.
2. Irrespective of statutory authority or reservation of the right in a final decree which awards a permanent injunction a court of equity has the inherent power, in order to do equity, and whether the injunction was awarded after litigation or by consent of the parties, to modify or vacate the injunction, upon due notice, by subsequent proceedings in the same suit, after the adjournment of the term at which the injunction was granted.
3. In the exercise of its inherent power a court of equity may after the adjournment of the term at which by final decree a permanent preventive injunction was awarded, modify or vacate the injunction after due notice, by subsequent proceedings in the same suit, whether the injunction was awarded after litigation or by consent of the parties, when it clearly appears that, because of a change in the controlling facts or the relations of the parties or the law upon which the injunction rests, its continuance is unjust or inequitable.
Samuel D. Lopinsky, of Charleston, for plaintiff.
Hogsett, St. Clair & McComas and J. W. St. Clair, all of Huntington, and M. O. Litz, of Charleston, for defendants.
By two separate pleadings, designated petitions, filed in the Circuit Court of Kanawha County on June 13, 1947, in a suit in equity formerly pending in that court in which Edlis, Inc., a corporation, was plaintiff, and C. A. Miller, Willie M. Miller, and The Huntington Barber & Beauty Supply Company were defendants, that company, as a corporation, and William O. Hayden, Omar M. Hayden, Alta P. Hayden and Jack P. Hayden, as individuals, who at the time owned all of its outstanding capital stock, ask that court to modify or vacate an injunction awarded by it against the Millers and The Huntington Barber & Beauty Supply Company, by final decree entered, by consent of the parties in the case, on July 29, 1942. Pursuant to process issued upon these petitions and served upon it, Edlis, Inc., the plaintiff in the original suit, appeared in court upon the return day and entered its separate demurrer in writing to each petition. The circuit court overruled the demurrers and, on its own motion, certified its rulings to this Court.
The allegations of the petitions disclose these facts which upon demurrer are regarded as true.
By written agreement, dated December 16, 1936, between C. A. Miller and Willie M. Miller, as parties of the first part, and Edlis, Inc., as party of the second part, it purchased from the Millers the capital stock owned by them in Kanawha Barber Supply Company, a corporation. In that instrument the Millers covenanted and agreed that after the sale they would not, by the operation of the barber and beauty supply business then owned by them in the City of Huntington, engage, directly or indirectly, or through any subterfuge whatsoever, in the barber or beauty supply business in Kanawha County, West Virginia, and that they would not sell or permit to be sold barber or beauty parlor supplies in that county. They also agreed that the violation by them of the covenant would constitute irreparable injury to the party of the second part which would justify the filing by it of a bill in equity for injunctive relief.
At the time of the making of the agreement the Millers owned or controlled the petitioner, The Huntington Barber & Beauty Supply Company, and they had also developed and established the Kanawha Barber Supply Company.
On June 21, 1941, Edlis, Inc., the purchaser from the Millers of the stock of Kanawha Barber Supply Company, under the agreement, as plaintiff, instituted the suit, in which the petitioners are filed, against C. A. Miller, Willie M. Miller, and the petitioner, The Huntington Barber & Beauty Supply Company, as defendants, for the purpose of enforcing the covenant in the agreement of December 19, 1936. The petitoner and the Millers filed their separate answers to the bill of complaint and denied its charges against them of violating the covenant and also denied that the Millers owned or controlled The Huntington Barber & Beauty Supply Company at any time subsequent to January 1, 1937.
On July 29, 1942, the cause was heard upon the bill of complaint of the plaintiff, Edlis, Inc., the separate answers of the defendants, the Millers and The Huntington Barber & Beauty Supply Company, the general replication of the plaintiff to the answers of the defendants, and depositions in behalf of the plaintiff. At that time the plaintiff, by its attorneys and the defendants, by their attorney, represented to the court that the defendants consented to the entry of a decree granting injunctive relief to the plaintiff to the extent stated and the court granted the plaintiff the relief consented to by the defendants by a provision of the decree which is set forth in this language:
'And it appearing to the Court, and the Court being of the opinion, that it is proper to grant to the plaintiff the relief prayed for to the extent consented to by the defendants, it is accordingly hereby
'Ordered, adjudged and decreed that the defendants, C. A. Miller, Willie M. Miller and Huntington Barber & Beauty Supply Company, a corporation, and each of them, as well also their respective agents and employees, be and they are hereby forever enjoined, restrained and inhibited:
'1. From soliciting for the purpose of selling; selling; or in any manner dealing in barber, beauty supplies and equipment in Kanawha County, West Virginia.
'2. From in any manner, directly or indirectly engaging in the beauty and barber supply business in Kanawha County, or in any manner competing with plaintiff's business in said County.'
The decree also adjudged that the defendants pay the court costs, omitting from such costs any attorney fee, and that the delivery by mail of a certified copy of the decree to the attorney for the defendants should be sufficient notice to them of its contents. No provision is contained in the decree which retains the case upon the docket or reserves authority in the court to modify the injunction or enter future orders or decrees. At the end of the decree, and following the words 'Entry consented to' are the signatures of the attorneys for the plaintiff and the signature of the attorney for the defendants.
Since July 1, 1946, all of the outstanding capital stock of The Huntington Barber & Beauty Supply Company has been owned by the petitioners, William O. Hayden, Omar M. Hayden, Alta P. Hayden and Jack P. Hayden, who also compose its board of directors and hold and occupy all the offices of the company. The Millers do not own any stock of The Huntington Barber & Beauty Supply Company, are not employed by or connected with it in any capacity, and are either unemployed or engaged in business of a type different from that now conducted by it.
On or about August 1, 1946, without any knowledge by the petitioners, the Haydens, of the existence of the litigation between the plaintiff and the Millers and The Huntington Barber & Beauty Supply Company or of the injunction awarded in it, The Huntington Barber & Beauty Supply Company began a program of sales promotion in Kanawha County, and in order to carry it into effect employed a specialist who moved his residence from Pittsburgh to Huntington for that purpose at considerable cost and expense, and the company is obligated to pay him large sums of money at great loss because of its inability, by reason of the injunction, to use his services in that county.
The petitions, which file as exhibits and as part of their contents the bill of complaint, the separate answers, and the decrees in the suit, and the contract of December 16, 1936, allege that the purpose of the covenant in the agreement of December 16, 1936, between the Millers and the plaintiff, Edlis, Inc., was to retain the good will of Kanawha Barber Supply Company, which had been developed chiefly through the efforts of the Millers, and to prevent them from competing with the plaintiff as the purchaser of the stock of Kanawha Barber Supply Company, directly or indirectly or by the use of The Huntington Barber & Beauty Supply Company as a basis of operation for the sale of barber and beauty supplies; and that, as the Millers now have no connection with The Huntington Barber & Beauty Supply Company, have retired from that business, and that company is entirely owned by the Haydens, the situation which existed at the time of the issuance of the injunction has so changed as to justify the modification of the final decree of July 29, 1942, and the dismissal from the suit of the defendant The Huntington Barber & Beauty Supply Company.
There is no allegation in the petitions that the attorney who appeared for the defendants, and signed the consent decree for them, was without authority to represent them, or that the entry of the decree was induced or procured by fraud upon the part of any party to the suit, or was due to mistake, surprise, or clerical error.
The prayer of the petitions is that the original suit be opened, that the decree entered July 29, 1942, be modified, that the injunctive relief granted against The Huntington Barber & Beauty Supply Company be reconsidered, that the injunction awarded against it be dissolved, and that it be dismissed from the suit.
The question presented by the certificate is, in substance whether a court of equity having jurisdiction...
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