Sivley v. Cramer
Sivley v. Cramer
Opinion of the Court
delivered the opinion of the court.
On and prior to the third day of April, 1907, II. F. Sivlej^ and W. B. Sivley, Jr., under the firm name of Siv-ley & Co., were conducting a fire insurance agency at Newton, Newton county, Miss.; and J. D. King and N. A. Cramer were conducting a similar business at Philadel
At a former day of this term the judgment of the court below was affirmed, and counsel for appellants now suggest-and earnestly contend that we erred in so doing. One of the grounds of the motion to exclude is that “the contract sued upon is in violation of the antitrust laws of the state of Mississippi.” In Cumberland Telephone Co. v. State, 100 Miss. 102, 54 So. 670, 39 L. R. A. (N. S.) 277, it was held that our antitrust statute, “only intended to include within its provisions those contracts in restraint of trade, . . . that were invalid as against public policy before the enactment of the statute.” It .will therefore be necessary for us to ascertain what the common law is with reference to contracts of the character here under consideration.
Contracts whereby the parties thereto, or either of them, are restrained from engaging in business, have been divided into two classes: “First, those which are
In determining whether or not such a contract is injurious to the public, it must be considered with reference to the situation, business, and objects of the parties, and in light of all the surrounding circumstances with reference to which it was made; and if it then appear that the restraint contracted for is necessary for the protection of the legitimate interests of the party in whose favor it was imposed, and also that the interests of the public are not injuriously affected thereby, it will be valid, otherwise not. All contracts in restraint of trade, where the reasonableness does not appear from the face thereof, are prima facie detrimental to the pub-
The only evidence on this point which has attracted our attention is contained in the following questions and answers, and is too vague and indefinite for this purpose: “Q. Why did you extend it over three counties? A. Because there was renewals in all three of the counties. Q. What do you mean by that? A. They had business in each of the counties. Q. You mean that they had written policies in these other counties? A. Yes, sir. Q. And they had a record of it? A. Yes, sir. Q. Where did you get the information that they had written in these other-counties ? A. Mr. Cramer and T looked over his register.”
It may be that the court can take judicial notice of the fact that, in order for the good will of a business to be protected, the party selling it must be restrained from again engaging in business in the immediate vicinity of the old place, and therefore that a contract restraining a party from engaging in business within the limits of a village, or any defined small area, would be reasonable
Suggestion of error overruled.
Reference
- Full Case Name
- H. F. Sivley v. N. A. Cramer
- Cited By
- 13 cases
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- Syllabus
- 1. Monopolies. Antitrust laws. Scope. Contracts. Restraint of trade. Validity. Good will. Burden of proof. Our antitrust statute only intended to include within its provisions those contracts which were invalid under the common law as against public policy. 2. Contracts. Restraint of trade. Validity. Contracts whereby the parties thereto or either of them, are restrained from engaging in business are divided into two classes: First, those which are a part of a transaction involving the good will of a business, which are designed to protect such good will; second, those which have for their primary object the formation of a monopoly in a given business. 3. Same. Contracts of the second class are void. In determining whether contracts of the first class are void it must be considered with reference to the situation, business and objects of the parties and in tie light of all the surrounding circumstances with reference to which it was made; and if it then appear that the restraint contracted for is necessary for the protection of the legitimate interest of the party in whose favor it is imposed and also not injurious to the public interest, it will be valid, otherwise not. 4. Same. All contracts in restraint of trade, where the reasonableness does not appear from the face thereof, are prima facie detrimental to the public interest and void; and the burden of showing the reasonableness of such a contract by evidence aliunde rests upon the party seeking to enforce it, and a contract made upon the sale of an insurance agency, whereby the seller agreed not to conduct any insurance agency in four counties for a period of ten years, will be held void, in the absence of evidence by the buyer showing its reasonableness; there being nothing upon the face of the contract to show that such an extention was necessary to protect the good will of the business sold. 5. Definition. Good will. The good will of a business is the probability that the customers will resort to the old place for the purpose of trade.