McCurry v. Gibson

• Decision Date: 17 December 1895
• Citation: 18 So. 806,108 Ala. 451
• Parties: McCURRY v. GIBSON.
• Court: Alabama Supreme Court

18 So. 806

108 Ala. 451

McCURRY v. GIBSON.

Supreme Court of Alabama

December 17, 1895

Appeal from city court of Anniston; James W. Lapsley, Judge.

Action by J. A. Gibson against S. J. McCurry to enjoin the breach of a contract whereby defendant agreed not to practice medicine in the city of Anniston for a period of two years. A decree was rendered for complainant, and defendant appeals. Affirmed.

Matthews & Whiteside, for appellant.

Pearce & Kelly and John F. Methvin, for appellee.

HEAD J.

The bill was filed on the 30th day of May, 1893, to enjoin the breach of a contract which the defendant made with the complainant in January of the same year. A preliminary injunction was granted at the institution of the suit, which the city court, upon defendant's motion for a dissolution, refused to dissolve, and upon final hearing it was continued in force according to the prayer of the bill. From the final decree the appeal is prosecuted by the defendant, the assignments of error being based upon the overruling of a demurrer to the bill, and a motion to dismiss for want of equity, and upon the final decree awarding the complainant relief. The bill in its amended form, stripped of repetition and redundancy, and appropriately condensed contains the following allegations: (1) That on the 3d day of January, 1893, the complainant, "who is also a practicing physician" (to quote the exact language of the bill), purchased from the defendant, who "was and had been prior thereto engaged in the practice of his profession as a physician, in the city of Anniston Ala.," for the consideration of $125, his horse, buggy and medical practice, the vendor agreeing in writing, as a part of the contract, not to practice his profession in that city for two years, and making the further stipulation that in case of failure to comply with the agreement he would pay to the complainant, "as a forfeiture, the sum of two hundred dollars." (2) That the defendant, in disregard of his agreement, continued to practice medicine in Anniston was then holding himself out for practice, and was serving all who desired his services; that he had refused to pay the stipulated sum mentioned in the contract, and was insolvent. (3) That when the contract, with defendant was made the complainant, upon the faith of the same, as defendant well knew, formed a partnership with one J. E. Simpson, another physician, for the practice of medicine in Anniston, and as such partners they entered into the practice there, moving their office to one formerly occupied by the defendant, who left the city. (4) That the complainant and said Simpson (each being equally interested in any practice done by the other) were then engaged in the pursuit of their profession when the bill was filed, although, in pursuance of an arrangement between themselves, complainant was temporarily absent from Anniston a part of the time; he at no time having abandoned the practice in that place, and he or his partner having, during the whole period, been engaged in the practice in said city. (6) That in consequence of the re-entry of the defendant into the practice of medicine in Anniston, the income of himself and partner had diminished about one-third. (7) That the complainant elects to insist upon a compliance upon the part of the defendant with his contract to refrain from practicing his profession in said city for the stipulated time; and he agrees, in case the preliminary injunction be made final, not to sue defendant for damages for a breach of the contract, nor seek to enforce a payment of the sum of $200, nor any other amount.

The demurrer assigned 12 grounds of objection to the bill, but all of them may be embraced and treated within the following classification: (1) That the contract alleged was void as being violative of public policy, and in unreasonable restraint of the practice of a learned profession. (2) That the contract expressed no adequate consideration. (3) That the bill showed complainant had an adequate remedy at law. (4) That it is not alleged that on January 3, 1893, the complainant had license to practice medicine in Alabama, nor in Calhoun county, nor in the city of Anniston; nor that he was able, competent, or authorized, under the law, to supply the city of Anniston with the accommodations the defendant obligated himself not to supply, for the two years covered by the contract, or to make the said contract.

The essential averments of the bill were either admitted by the defendant in his answer or testimony, or satisfactorily established by other proof; and most of the questions that have been argued may be resolved by a consideration of the ruling upon the demurrer. The other points urged upon us for a reversal of the decree of the city court will be noticed when we come to refer to other matters of defense set up or undertaken to be brought forward by the answer.

The questions of law raised by the demurrer have, for the most part, been so often the subject of judicial decision in this country and in England that in respect of them but little room is left for argument. It is well-settled law that, while contracts in general restraint of trade are against public policy and void, yet those in partial restraint, founded upon a valuable consideration, and reasonable in their operation are valid and binding. 3 Am. & Eng. Enc. Law, p. 882, and cases cited in 10 Am. & Eng. Enc. Law, p. 943. The test which is laid down by which it may be determined whether the contract is reasonable is whether it affords only a fair protection to the interests of the party in whose favor it is made, without being so large in its operation as to interfere with the interests of the public (Horner v. Graves, 7 Bing. 735, 743); and this test has been uniformly followed in subsequent cases (Cook v. Johnson, 47 Conn. 175; Brewer v. Marshall, 19 N. J. Eq. 547; Chappel v. Brockway, 21 Wend. 157). A partial restraint is that which is restricted in its operation in respect to place, and this may be made in express terms or it may result from a construction of the contract when viewed in the light of the environments and circumstances surrounding the contracting parties. Moore & Handley Hardware Co. v. Towers Hardware Co., 87 Ala. 206, 6 So. 41. It is very frequently the case that such contracts, like that made in the present instance, contain a limit as to time also; but there is a distinction between a general restriction as to place and one as to time, it being now well settled that an agreement not to engage in a certain business in a stated place, or within a reasonably limited territory, is not rendered invalid by a failure to specify any limit of time for its duration. Carll v. Snyder (N. J. Ch.) 26 A. 977; French v. Parker (R. I.) 14 A. 870; Cook v. Johnson, supra; and the numerous authorities cited in each of these cases. Contracts by professional men, such as physicians, surgeons, dentists, and lawyers, when coming within the rule stated, not to practice their professions in competition with another pursuing the same calling, have time and again been enforced; and no distinction is made between their contracts and those of tradesmen. The suggestion that, while valid in a court of law, the agreement of a person not to pursue a profession involving the exercise of skill and learning will not be specifically performed in equity, is not tenable. The doubt expressed in an early English case has long since been resolved in favor of the jurisdiction of the chancery court, and numerous instances are to be found of its exercise when invoked to restrain by injunction the breach of a valid contract not to practice law or medicine in competition with the complaining party. As we are dealing with a case between physicians, we will cite a few of the cases directly in point: Cole v. Edwards (Iowa) 61 N.W. 940; McClurg's Appeal, 58 Pa. St. 51; Dwight v. Hamilton, 113 Mass. 175; Butler v. Burleson, 16 Vt. 176; Timmerman v. Dever, 52 Mich. 34, 17 N.W. 230; Doty v. Martin, 32 Mich. 462; Wilkinson v. Colley (Pa. Sup.) 30 A. 286. It is settled by the authorities that the purchase by one party of the property and good will of the business of another furnishes a sufficient consideration for an agreement by the latter, in enhancement of the value of the good will, not to compete with him in the conduct of the business. The rule is the same when a physician sells his property and practice to a professional brother. It was at an early day supposed that the consideration in such cases must be adequate,-that is, equal in value to the restraint imposed; but this idea has been exploded ever since the decision in Hitchcock v. Coker, 6 Adol. & E. 438, which has been repeatedly approved and followed; and in which Chief Justice Tindal said: "If by adequacy of consideration more is intended, and that the court must weigh whether the consideration is equal in value to that which the party gives up or loses by the restraint under which he places himself, we feel ourselves bound to differ from that doctrine. A duty would thereby be imposed upon the court in every particular case, which it has no means whatever to execute. It is impossible for the court to say whether in any particular case the party restrained has made an improvident bargain or not." In a note to Angier v. Webber, 92 Am. Dec. 748, 754, many authorities to the same effect are collected. We may add that the same doctrine upon the subject of adequacy of consideration obtains generally in cases of specific performance, and it is now recognized by the leading text writers as the modern and more reasonable rule, as we declared in South & N. R. Co. v. Highland Ave. & B. R. Co., 98 Ala. 400, 13 So. 682. The written contract exhibited with the bill showed upon its face a sufficient...