Hitchcock v. Anthony

• Decision Date: 07 December 1897
• Docket Number: 481.
• Parties: HITCHCOCK v. ANTHONY.
• Court: U.S. Court of Appeals — Sixth Circuit

83 F. 779

HITCHCOCK v. ANTHONY.

No. 481.

United States Court of Appeals, Sixth Circuit.

December 7, 1897

This is an action for a breach of contract between William D Hitchcock, plaintiff in error, and Thomas C. Anthony defendant in error, whereby said Hitchcock agreed not to engage in certain business for a period of seven years from February 24, 1892. This contract was in writing, and was as follows: 'This agreement, made and entered into this 24th day of February, A.D. 1892, by and between Thomas C. Anthony of Sault Ste. Marie, Mich., and W. D. Hitchcock, of Chicago Ill.: The party of the first part, Thos. C. Anthony, has this day sold and conveyed unto the said W. D. Hitchcock all the property at Detour, Mich., known as the Hurd & Heinstoin and Moiles Property, for the sum of ten thousand dollars; and the said W. D. Hitchcock, party of the second part, agrees with the said Thomas C. Anthony to not purchase or offer for sale any coal, except what coal they may require for their own use, to any steamers, boats, or persons, and also to not traffic in the buying or selling of fish, except fish that may be caught with his own nets, or do anything that will conflict with the said coal or fish business of the said Thomas C. Anthony, and further agrees to not act as general agent and ticket agent, or in any capacity for any steamer or line of boats, nor to do any business whatever with said steamer or boats of any kind, as receiving and shipping of freight, merchandise, etc., except to receive their own goods and merchandise, and ship out same, when necessary, for the period of seven years from date thereof. And, further, that the said party of the second part agrees that while said Anthony gives full warranty deed, as required by said Hitchcock, yet said sale is made with full knowledge of said Hitchcock of the conditions of the deeds given by George Dawson, a former owner, regarding restrictions as to dock or shipping privileges; and said Anthony shall not be held responsible for any damages to Hitchcock by reason of said restrictions in said Dawson conveyances.

And, further, that the said Anthony may have the contents of one of the ice houses on said premises the present season, the same having been recently filled by said Anthony, together with the privileges of entering on said premises and getting said ice at his will during the coming season. ' The declaration alleged that Thomas C. Anthony was the lessee of a certain dock on the St. Mary's river, at the village of Detour, and was engaged in doing a coal and fish business thereon, his principal business being that of supplying coal to steamers. He was also the owner of certain real estate in said village fronting on the river, and upon which was situated another dock suitable for carrying on a like coal and fish business in competition with that conducted by himself. This real estate and appurtenant dock Anthony sold to W. D. Hitchcock for $10,000, and conveyed same by deed of general warranty. It is further averred that, as an additional consideration for said sale and conveyance, said Anthony entered into the agreement above set out, and that said agreement had been violated by leasing said dock to be used for the purpose of carrying on said prohibited business, and that the lessee thereunder had since engaged in the business of selling coal from said dock to steamers, in active competition with same business conducted by plaintiff on his own dock, whereby damages had ensued. There was a verdict and judgment in favor of the defendant in error.

M. F. McDonald and Watts S. Humphery, for plaintiff in error.

H. M. Oren and T. O. Clark, for defendant in error.

Before TAFT and LURTON, Circuit Judges, and CLARK, District Judge.

LURTON Circuit Judge, after making the foregoing statement of facts, .

The conveyance of this dock to Hitchcock, and his agreement not to engage in a business which should compete with that carried on by Anthony upon another and adjacent dock, bear the same date. This fact, in connection with the manifest purposes of the contract as indicated by its whole tenor, affords prima facie evidence of the simultaneous execution of the two instruments, and that the consideration for the contract was the sale and conveyance of the dock and realty to which it was appurtenant. They really constitute but one transaction, and should be read together.

It has been argued that this contract imposes a general restriction upon Hitchcock engaging in the prohibited business without limitation of territory, and is therefore against public policy and void. Anthony was engaged in supplying coal to steamers passing Detour, and also dealt in fish. This business was essentially one to be conducted upon a dock conveniently situated at Detour. Hitchcock was engaged in manufacturing and dealing in lumber, and the property purchased by him afforded facilities for that business. The business of neither conflicted with that of the other. In this situation Anthony sold to Hitchcock a desirable site for his lumber mill and yard and a dock, which furnished him shipping facilities, and, by a separate writing, bound him not to engage in the line of business which Anthony was conducting. The heart of the agreement lies in the stipulation that Hitchcock will not 'do anything that will conflict with the said coal or fish business of the said Thomas C. Anthony. ' This clause, though an enlargement of the restriction as to detail, implies that the prohibition is not general, but limited. How and what is the limitation? This we must ascertain by taking into consideration every part of the agreement, and ascertaining the meaning of the instrument in the light of the circumstances surrounding the parties at the time. We have already noticed the contemporaneous execution of a deed conveying to Hitchcock certain property fronting on the St. Mary's river and a dock extending out into the river. This deed is recited in the first clause of this contract. The last two clauses directly relate to the property conveyed by that deed. One limits Hitchcock's rights thereunder, while the other grants an easement to Anthony in a matter collateral to the question here involved. The only other paragraph of the agreement contains the stipulation restricting the purchaser of that property from engaging in the coal or fish business, or doing 'anything that will conflict with the said coal and fish business of said Anthony. ' Now, this business which Anthony was conducting was one which could only be conducted upon a dock, and the dock appurtenant to the property conveyed to Hitchcock was so situated as that a similar business could be carried on upon it. The object of Anthony was to prevent competition, not at Detour generally, but by the use of this dock just conveyed to Hitchcock, and adapted to the doing of a competitive business. The circuit judge was of opinion that the circumstances were such as to justify a limitation of this restriction upon Hitchcock to the property so sold to him. To this conclusion we fully agree. Hitchcock's obligation, while widened by the stipulation that he should do nothing which should conflict with Anthony's coal and fish business as to details, is at the same time limited, by implication, in respect of locality. The agreement had reference alone to the uses of the dock...