Hutchinson v. Nay

• Citation: 183 Mass. 355,67 N.E. 601
• Parties: HUTCHINSON v. NAY.
• Decision Date: 22 May 1903
• Court: United States State Supreme Judicial Court of Massachusetts

183 Mass. 355

67 N.E. 601

HUTCHINSON v. NAY.

Supreme Judicial Court of Massachusetts, Suffolk.

May 22, 1903

COUNSEL

Wm P. Hale and Fred P. Carr, for appellant.

Frank N. Nay and Leon M. Abbott, for appellee.

OPINION

LORING J.

This case comes up on an appeal by the plaintiff from a final decree overruling all exceptions taken by her to the report of a master. The material facts set forth in the master's report are that prior to the death of the plaintiff's intestate he had been for over 36 years in partnership with the defendant in the teaming business in Boston. The business done by the partnership was principally as teamsters for wholesale dealers in shoes and leather, and was carried on at two stands--one on Pearl street, in charge of the defendant the other on Federal street, in charge of the intestate. Neither drove a wagon, and it was necessary that each should remain at his stand nearly all the time, to receive orders for carting for customers, and to direct the work of the drivers of the carts. The custom depended to a very great extent upon the personal relations between the partners and their customers. Hutchinson, the intestate, died on January 31, 1901. A few days after his death the defendant told the plaintiff, who was Hutchinson's daughter, and her mother, Hutchinson's widow, that he intended to continue in the teaming business, and that he wished to buy their interest in the late firm; but he made no express reference to good will, and it is expressly found by the master 'that he never assumed nor purchased, nor agreed to assume nor to purchase, such good will, unless that result follows as a matter of law from the other facts herein found.' Since Hutchinson's death, Nay has carried on the teaming business on his own behalf, in the same places and with the property of the late firm, and for its customers, using the old firm books. He struck off the words '& Co.' from the billheads about February 1, 1901. On June 22, 1901, the plaintiff sold to the defendant 'all of Hutchinson's interest in the firm and chattels, except the good will and outstanding accounts'; and, immediately after, the defendant had the words '& Co.' painted off from the carts.

If the plaintiff is entitled to anything in the matter of the good will of the late firm, it was to have the good will put up for sale on Hutchinson's death. Whether she had that right is not settled in this commonwealth, although it is settled that she would have had that right, had the question arisen in England. In re David and Matthews [1899] 1 Ch. 378, 382. Lindley on Partnership (6th Eng. Ed.) 445. What is not settled in England is the basis on which such a sale will be conducted, so far as the right of the survivor to carry on a competing trade and to solicit business from the customers of the old firm is concerned. It is plain there that the surviving partner who does not buy the good will can set up a competing business. Johnson v. Helleley, 2 D. J. & S. 446; Hall v. Barrows, 4 D. J. & S. 150. But in England one who voluntarily sells the good will of his business can always do that. Lindley on Partnership (6th Eng. Ed.) 442. What such a person cannot do in England is to solicit business from customers of the old firm, because that would derogate from his grant. Trego v. Hunt [1896] A. C. 7; Gillingham v. Bedloe [1900] 2 Ch. 242. In Massachusetts a person who sells the good will of his business cannot set up a competing business, if doing so would derogate from his grant. The cases are collected and reviewed in Webster v. Webster, 180 Mass. 310, 62 N.E. 383. It was held in England, in Walker v. Mottram, 19 Ch. D. 355, affirming Crutwell v. Lye, 17 Ves. 355, that, after the sale of the good will of the business of a bankrupt, the bankrupt who did not purchase it could not only set up a competing business, but could solicit business from customers of the old firm. See, also, Trego v. Hunt [1896] A. C. 7, 19, 23. But see In re David and Matthews [1899] 1 Ch. 378. The only case in this commonwealth on the rights of partners in the matter of good will on the termination of a partnership is Webster v. Webster, 180 Mass. 310, 62 N.E. 383. But that case does not touch the question before us.

After stating these facts, the master's report, so far as material, is as follows: 'There was no evidence of any request or demand of the plaintiff to the defendant that the defendant should offer the chattels or good will for sale but from a few days after Hutchinson's death down to June 22, 1901, the date of the plaintiff's bill of sale, the parties were negotiating for a settlement, and the only dispute, aside from accounting, was as to the amount which the defendant should pay for the Hutchinson interest. If Nay had not continued the business after the death of Hutchinson,...