Goodman v. Henderson

• Decision Date: 31 January 1877
• Citation: 58 Ga. 567
• Parties: Abram B. Goodman et al., plaintiffs in err0r. v. Moses Y. Henderson, defendant in error.
• Court: Georgia Supreme Court

58 Ga. 567

Abram B. Goodman et al., plaintiffs in err0r. v. Moses Y. Henderson, defendant in error.

Supreme Court of the State of Georgia

(Atlanta, January Term, 1877.)

[This case was argued at the last term, and the decision reserved.]

Contracts. Evidence. Damages. Before Judge Tompkins, Chatham Superior Court. February Terra, 1876.

Reported in the opinion.

Jackson, Lawton & Basinger, for plaintiffs in error.

Hartridge & Chisholm, for defendants.

Jackson, Judge.

This suit was upon a written agreement, executed in duplicate, whereby Goodman and the other defendants below, agreed to "retire from the business of purchasing, in the Savannah market, green hides, sheep-skins and hides, and skins dried by butchers, forever, and that they and each of them will use their influence in favor of said party of the second part, and by this memorandum do transfer to him their good-will and the goodwill of each of them in and to said business." In consideration of the premises above set out, the party of the second part agreed to pay Goodman and the others "for and during two years from date, one hundred dollars per month, and three-eighths of one per cent. per pound on all green hides, up to thirty thousand pounds, purchased by him in the Savannah market;" and it was further stipulated, that either party violating the provisions of the agreement should pay the other five thousand dollars, "not to be considered in the nature of a penalty, but as stipulated and liquidated damages."

The jury, under the charge of the court, found for Henderson $5,000, whereupon Goodman et al. moved for a new trial, on various grounds. The court refused to grant it, and they excepted.

1. The main question in the case is, whether or not this contract is in general restraint of trade, and, therefore, void *as against public policy? Our Cede declares that "contracts in general in restraint of trade"—Code, § 2750— cannot be enforced; and the question has been several times before this court, in respect to what contracts are and what are not in general restraint of trade, and the distinction between contracts in general and those in partial restraint of trade is wed settled, we think, in our own books. This contract was limited to the Savannah market, and the first and main question is, does that limit make it in general restraint, or only in partial restraint, of trade? The Code really seems to be, in this respect—in regard to this class of contracts, —but a re-enactment of the common law. The principle seems to be, that the restraint of trade must be limited in territory, limitation in time not affecting the validity of the contract. It may be forever, and still good—Addison on Contracts, 99; 2d Am. Ed. Chitty on Contracts, 576. Hitchcock v. Porter, 8 A. & E., 438, 456; 11 M. & W., 652; 2 Exch., 611; 7 Black, 344; 33 Eng. Common Law, 254; 6 Porter, Ind., 204. But it may not extend everywhere, though limited in time—5 M. & W., 548, 561. So in our leading case, in 10 Ga., 505, where a hotel building was sold, with the stipulation that the vendee, and those holding under him, should never keep it as a public house, the stipulation was held good, though there was but one other public house in the town of Lawrenceville, and the vendee had opened it to the public—see cases there cited. So in 39 Ga., 655, the distinction between general and partial restraint of trade is taken, and the contract was upheld. In the last-named case a grocery was sold, with the contents thereof, on condition that the vendor would not open a similar store in the town of Spring Place until a certain specified time, and would use his influence for the other, the vendee paying a higher price for the groceries on account of the stipulation and good-will. In the former case, Lumpkin, C. J., says, that "the distinction was early taken, and is established by an unbroken current of authority, Englishand American, between such stipulations as are in general *restraint of trade, and such as are in restraint of it only as to particular places and persons, or for a Kmited time: the latter, if founded upon a good and valuable consideration, are valid." So that the court ruled, in 10 Ga., that the only requisition was, that the contract should be founded upon a good and valuable consideration and confined in space. It is true that Judge Lumpkin does use the words, "or for a limited time, " but in the very case he was deciding the time was unlimited, and we have shown that the limit as to time makes no difference, if the contract be limited as to space. So in Mell v. Mooney, 30 Ga., 414, the same doctrine was applied in the case of physicians, and in 45 Ga., 319, in the case of schoolmasters. If there ought to be competition and free trade in anything, it should be in doctors and schoolmasters. Wehold, therefore, that this contract is good, it being confined to the Savannah market. It was argued that it tended to a monopoly, as the contracting parties were the only active parties engaged in purchasing such hides; but any others, we suggest, could engage, if they wished, and, if prices warranted, they...