Highland Laundry Co. of Lowell v. Wotton

• Decision Date: 29 January 1936
• Citation: 293 Mass. 322,199 N.E. 757
• Parties: HIGHLAND LAUNDRY CO. OF LOWELL, Inc., v. WOTTON.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

293 Mass. 322

199 N.E. 757

HIGHLAND LAUNDRY CO. OF LOWELL, Inc.,

v.WOTTON.

Supreme Judicial Court of Massachusetts, Middlesex.

Jan. 29, 1936.

Suit in equity by the Highland Laundry Company of Lowell, Inc., against Isaac E. Wotton. From an adverse final decree, the plaintiff appeals.

Affirmed.

Appeal from Superior Court, Middlesex County; Morton, Judge.

D. P. Ranney, of Boston, for plaintiff.

M. G. Rogers, of Lowell, for defendant.

PIERCE, Justice.

This is a suit in equity wherein the plaintiff prays that the defendant, his agents and servants, be permanently enjoined from conducting a laundry business in Lowell and surrounding towns in Massachusetts, and from in any manner interfering with the plaintiff's laundry business, in Lowell and in the surrounding towns, by soliciting the laundry business of its customers, by taking away its laundry business, by interfering with its employees, or by any means whatsoever. Upon the completion of the pleadings the case was referred to a master, under the usual rule, to ‘find the facts and report his findings to the Court, together with such questions of law, arising in the course of his duty, as any party may request.’ In compliance with the terms of the order the master heard the parties, and, no objections being taken, reported his findings to the court. The report of the master was confirmedby an interlocutory decree entered October 8, 1935. After argument of counsel and consideration thereof, a final decree was entered dismissing the bill of complaint without costs to either party. The case is before this court on the appeal of the plaintiff from the final decree.

The facts found by the master, succinctly stated, are as follows: Prior to February 27, 1931, the defendant for about twenty-five years was the owner of a successful laundry business in Lowell and the surrounding towns, and in Harvard. On February 27, 1931, the defendant, whose laundry business had an extensive and valuable good will attached to it, sold that business as a going business, including all the assets and equipment except cash and accounts receivable, to the plaintiff corporation for $15,000 cash and a note for $5,000. The ‘transaction which constituted said sale was not accompanied by the execution of any written instrument by either of the parties thereto except said promissory note dated February 27, 1931, and except that the * * * [plaintiff] (whose corporate name then was Highland Superior Laundry Company * * *) and the * * * [defendant] simultaneously with said sale and as a part of the same transaction, executed and delivered to each other a written agreement,’ a copy of which, omitting the paragraph which is descriptive of the parties and the final paragraph which bears the signatures, reads: ‘The said Isaac E. Wottonshall enter into the services of the said corporation, the party of the first part, as the manager of their laundry business, in Lowell, aforesaid, for the period of three (3) years, from the 16th day of February, 1931, subject to the general control of said corporation. The said Isaac E. Wotton shall devote the whole of his time, attention and energies to the performance of his duties as such manager, and shall not either directly or indirectly, alone or in partnership, be connected with or concerned in any similar business or pursuit whatsoever during the said term of three (3) years. The fixed salary of the said Isaac E. Wotton, shall be the sum of Thirty-Six Hundred ($3,600.00) Dollars annually, payable by the said corporation, in monthly installments of $300.00 each.’ Upon the execution of this agreement the defendant was elected president of the plaintiff corporation and ceased to be engaged in the laundry business except as president and manager of the plaintiff's laundry business under the written agreement dated February 27, 1931, the terms of which were fulfilled by both parties thereto. After the expiration of his employment under the written contract the defendant, still president of the plaintiff corporation, continued to be employed by it as manager, spending most of his time supervising a mangle room or ironing room, at a reduced salary of $200 a month until January, 1935, when his salary was again reduced to $35 a week.

At the time of the sale of the defendant's business, a Miss McDonough had been for many years in the employ of the defendant in charge of his pressing room in the laundry. After the sale she continued in the plaintiff's employ, was a competent employee and was loyal to her employer while she remained in the plaintiff's employ. Miss McDonough gave up her employment with the plaintiff on June 11, 1935. Late in June, 1935, she formed a copartnership with one John Hanlon, who was and for some time had been a competitor of the plaintiff in Lowell, and who then conducted a laundry under the name and style of the Merrimack and Sunshine Laundry Company, hereinafter called the Merrimack Laundry. The copartnership thus formed continued the business under the same name and style.

On June 29, 1935, the defendant was greatly dissatisfied with the situation at the plaintiff's laundry and with his own situation, and on that day handed to Mr. Farnsworth, treasurer of the plaintiff corporation, a letter addressed to the board of directors of the corporation, which reads: ‘Gentlemen: I hereby tender to you my resignation both as President and Manager of the Highland Laundry Company to take effect at the close of business on July 6, 1935.’ Thereupon the defendant and Farnsworth had a conversation wherein Farnsworth told the defendant that, inasmuch as the defendant was getting through, he, Farnsworth, did not think the...