J.L. Davis, Inc., v. Christopher

• Court: Alabama Supreme Court
• Writing for the Court: FOSTER, J.
• Citation: J.L. Davis, Inc., v. Christopher, 122 So. 406, 219 Ala. 346 (Ala. 1929)
• Decision Date: 16 May 1929
• Docket Number: 7 Div. 884.
• Parties: J. L. DAVIS, INC., v. CHRISTOPHER.

122 So. 406

219 Ala. 346

J. L. DAVIS, INC., v. CHRISTOPHER.

7 Div. 884.

Supreme Court of Alabama

May 16, 1929

Appeal from Circuit Court, Etowah County; O. A. Steele, Judge.

Bill for injunction by J. L. Davis, Incorporated, against G. E Christopher. From a decree dissolving temporary injunction and sustaining a demurrer to the bill, complainant appeals. Affirmed.

Inzer Inzer & Davis, of Gadsden, for appellant.

Culli Hunt & Culli, of Gadsden, for appellee.

FOSTER J.

Appellant was complainant in the circuit court, in equity, praying for an injunction of the violation of an agreement between the parties whereby appellee sold appellant his insurance agency records, furniture, and fixtures, and agreed "not to write or solicit fire, tornado or fire and theft insurance for any insurance company for a period of three years." The agreement did not confine the prohibition to any territory or locality. The general rule is that the contract should specify a reasonable territory and time. In fact such is now embraced in section 6827 of the Code. We think this section of the Code but expressed the law as theretofore settled. Crossfield v. Lokey, 212 Ala. 560, 103 So. 649; Harris v. Theus, 149 Ala. 133, 43 So. 131, 10 L. R. A. (N. S.) 204, 123 Am. St. Rep. 17; Saxon v. Parson, 206 Ala. 491, 90 So. 904; Smith v. Webb, 176 Ala. 596, 58 So. 913, 40 L. R. A. (N. S.) 1191; McCurry v. Gibson, 108 Ala. 451, 18 So. 806, 54 Am. St. Rep. 177.

The bill alleges that at that time respondent was soliciting fire, tornado and fire, and theft insurance within a territory including Etowah county, but largely confined to the city of Gadsden and its immediate surroundings. It is alleged that respondent was at the time of filing the bill engaged in writing or soliciting fire, tornado or fire, and theft insurance in Etowah county in violation of said agreement.

Respondent contends first that the contract is void because it does not express the territory in which it is to operate. This court, in the case of Moore & Handley v. Towers, 87 Ala. 206, 6 So. 41, 13 Am. St. Rep. 23, pointed out that the terms of such contract will be construed in connection with attendant circumstances, and, though there is no expression in its terms of the territory embraced, the extent of such territory may be inferred from such circumstances. The same has also been held with respect to the time of its operation when not expressed. Smith v. Webb, 176 Ala. 596, 58 So. 913, 40 L. R. A. (N. S.) 1191.

We think, however, that the bill should do more than express the bare fact of the territory in which defendant was doing business. The pleader should allege the facts and circumstances justifying a statement which should be distinctly made describing the territory that was referred to in the contract, and not leave this to inference. Pleadings should do more than state facts from which inferences may be drawn. But the inference should be stated in the pleadings as a fact drawn from the circumstances alleged which are sufficient to that end; and, while the bill alleges that respondent has breached this contract, it does not allege that such breach affects complainant, for it does not show that complainant is doing business at all in that territory.

In the Moore-Handley Case, supra, the parties were competitors in business in certain territory, and a breach of the agreement to desist materially affected the trade of the other. Such is not shown here in any respect. The bill in that case alleged that the agreement was with respect to a certain defined territory. We think that the bill does not sufficiently show to what territory the contract related, nor how complainant was affected by its breach. 32 C.J. 219.

Appellant in brief makes certain statements as to the relations between it and respondent and Ford and Tinsley Insurance Agency. But such matters cannot be considered in passing on the sufficiency of the bill. It may be that the facts exist which may be alleged in an amendment which would bring the case in the influence of the Moore-Handley Hdw. Company Case, supra, but they should be alleged, for we cannot presume, nor judicially know, that they exist.

The cause was heard on demurrer to the bill and on motion to dissolve the injunction for want of equity in the bill and on the answer and affidavits. The court sustained the demurrer and dissolved the injunction. We think the injunction was properly dissolved for want of equity in the bill, in that it did not show a contract sufficient as to the territory embraced, though this defect is open to correction by amendment, if sufficient facts exist.

We will now discuss another reason which we think justifies the decree dissolving the injunction. It seems to be well settled in this as in most other jurisdictions that a covenant reasonable and definite as to territory and time entered into by the seller of a business not to engage in a similar business passes with a subsequent sale of the business, even though not expressly assigned. Knowles v. Jones, 182 Ala. 187, 62 So. 514; 32 C.J. 219; Sickles v. Lauman, 185 Iowa, 37, 169 N.W. 670, 4 A. L. R. 1073, note...