Hill v. Central West Public Service Co.

• Decision Date: 30 January 1930
• Docket Number: No. 5561.,5561.
• Citation: 37 F.2d 451
• Parties: HILL v. CENTRAL WEST PUBLIC SERVICE CO.
• Court: U.S. Court of Appeals — Fifth Circuit

37 F.2d 451 (1930)

HILL v. CENTRAL WEST PUBLIC SERVICE CO.^*

No. 5561.

Circuit Court of Appeals, Fifth Circuit.

January 30, 1930.

Henri Louie Bromberg, of Dallas, Tex. (J. Hart Wills, of Dallas, Tex., J. W. Madden, of Crockett, Tex., and McCormick, Bromberg, Leftwich & Carrington, of Dallas, Tex., on the brief), for appellant.

Will R. Harris, of Dallas, Tex. (Thompson, Knight, Baker & Harris, Alex F. Weisberg, and Will R. Harris, all of Dallas, Tex., on the brief), for appellee.

Before WALKER and BRYAN, Circuit Judges, and DAWKINS, District Judge.

WALKER, Circuit Judge.

The appellee, a corporation, became the assignee or successor of an individual who, in May, 1928, pursuant to an option given in February, 1928, purchased the properties located in Dallas, Tex., of the Texas Ice & Cold Storage Company, and the good will of that company (herein referred to as the Ice Company), which prior to the sale of its properties was engaged in the manufacture and sale of ice. A feature of the contract of sale referred to was that the Ice Company and its officers and stockholders, one of whom was the appellant, C. B. Hill, joined in that contract, and agreed with the purchaser, his assigns or successors, that each of them will not engage, directly or indirectly, for a period of five years in the state of Texas from the date of said contract of sale in any line of business in which the company was engaged at the time of the making of the above-mentioned option agreement, either individually, or as members or employees of any copartnership, or as officers, directors, stockholders or employees in any corporation. The bill in this case was filed by the appellee against the appellant on October 1, 1928. It contained allegations to the effect that at the time the bill was filed appellant was commencing to erect in the city of Dallas an ice plant in which he intends to conduct and operate a business for manufacturing and selling ice unless he is restrained and enjoined from doing so. The bill prayed an injunction restraining appellant, his agents, employees, or associates, from erecting the plant mentioned, or any plant or building in Dallas or elsewhere in Texas for the manufacture or sale of ice, or from engaging, in the city of Dallas or elsewhere in the state of Texas, for the above-mentioned period of five years, in any line of business in which the Ice Company was engaged on or about February 21, 1928. By his answer to the bill appellant admitted that he was engaged in the construction of an ice plant in the city of Dallas, and that he proposed to engage in the ice business. The granting of the relief sought was resisted on the grounds: (1) That the covenant not to engage in the lines of business mentioned was invalid because that covenant undertook to make the restraint operative throughout the state of Texas, though the business of the Ice Company and its good will were confined to the city of Dallas and some nearby territory; and (2) that the agreement containing the restrictive covenant mentioned was void by reason of it being part of a plan or scheme to place all properties used in the ice business in the city...