Kradwell v. Thiesen

• Decision Date: 19 March 1907
• Parties: KRADWELL ET AL. v. THIESEN ET AL.
• Court: Wisconsin Supreme Court

131 Wis. 97

111 N.W. 233

KRADWELL ET AL.

v.THIESEN ET AL.

Supreme Court of Wisconsin.

March 19, 1907.

Appeal from Circuit Court, Racine County; E. B. Belden, Judge.

Action by Gustave V. Kradwell and others against Thies W. Thiesen and others. From an order overruling defendants' demurrers to the complaint, they appeal. Affirmed.

This is an action to restrain the defendant Thiesen from selling drugs or conducting a drug store in Racine, contrary to his agreement with the plaintiffs, executed June 23, 1903. It appears and is undisputed that for some time prior to February 9, 1895, Thiesen owned and operated a drug store in Racine under his own name. February 9, 1895, the Robinson Drug Company was incorporated with Thiesen as one of its stockholders and directors, and thereupon Thiesen conveyed and transferred to the said Robinson Drug Company all of his interest and good will in his drug business in Racine. January 1, 1900, the corporate name of the association was by amendment changed to the Kradwell-Thiesen Drug Company, and continued to do such drug business in that name in Racine until January 26, 1905. While so doing business and while said Thiesen and the three Kradwells owned capital stock in that association, Thiesen agreed to sell and transfer his 45 shares of such stock to the three Kradwells mentioned, or some of them, for $5,000 then paid, and in consideration of which, and as a part of the same agreement, the said Thiesen then and there under his hand and seal agreed and bound himself in writing with the said Kradwells that for and during a period of five years from and after June 23, 1903, being the date of the agreement first mentioned, he would not either directly or indirectly, in his own name or as stockholder or as agent, engage in the business of selling drugs either at wholesale or retail, or conduct a drug store, within the corporate limits of Racine. It appears that at the time of the commencement of this action, June 12, 1906, the Kradwells were, and still are, the sole owners of the capital stock of the Kradwell Drug Company; that for at least 30 days immediately preceding the commencement of this action the defendant Thiesen had openly breached and broken his said contract of June 23, 1903, and by the procurement of the defendant Red Cross Drug Company, acting with full knowledge of such agreement, engaged with said last-named company as its manager or managing agent or superintendent in charge of the stores of that company in Racine, and also had assisted that company in the management of its business. Upon an order to show cause and hearing had, the trial court on July 17, 1906, granted a temporary injunction restraining the defendant Thiesen from doing any of the things he had agreed not to do in his agreement of June 23, 1903, upon giving the undertaking therein prescribed. From such injunctional order the defendant Thiesen brings this appeal. August 1, 1906, the complaint was amended, making the allegations somewhat stronger as to the Red Cross Drug Company. To such amended complaint each of the defendants separately demurred, and each of such demurrers was by a separate order overruled by the court, and from such orders overruling the same the defendants separately bring this appeal.Palmer & Gittings (James G. Flanders, of counsel), for appellants.

Simmons, Nelson & Walker and Kearney, Thompson & Meyers, for respondents.

CASSODAY, C. J. (after stating the facts).

The principal controversy in this case is as to whether the written agreement of June 23, 1903, “is absolutely void as a matter of law.” The contents of the agreement are sufficiently set forth in the foregoing statement. Counsel for the defendant is undoubtedly right in claiming that “a contract in restraint of trade is presumably void as against public policy.” The general rule, as deduced from the English adjudications, seems to be that “a contract in general restraint of trade is illegal and void as being against public policy; but a particular restraint of trade within reasonable limits, having regard to the protection of the interests of the party contracted with, is valid.” Mallan v. May, 11 Meeson & Welsby 653, 6 E. R. C. 392. The adjudications of this court are in harmony with the rule stated. Washburn v. Dosch, 68 Wis. 436, 32 N. W. 551, 60 Am. Rep. 873;Richards v. American Desk & Seating Co., 87 Wis. 503, 512, 58 N. W. 787;Palmer v. Toms, 96 Wis. 367, 369, 71 N. W. 654;Cottington v. Swan, 128 Wis. 321, 107 N. W. 336;My Laundry Co. v. Schmeling (Wis.) 109 N. W. 540, 545, 546. As stated by Mr. Justice Pinney in the Richards Case, cited, such contract is not void in case it is “founded upon a valuable consideration and limited,...