McCornack v. Sharples
McCornack v. Sharples
Opinion of the Court
Opinion by
This appeal is from the same decree which has been under consideration in the opinion which has just been filed at No. 457, January Term, 1915. Two points are here raised. First, should interest have been allowed upon royalties which were not paid when due. Interest was refused by the referee and the court below. Second, should the appellee pay all the costs. The referee so held, but the court below divided them. On August 10, 1899, McCornack licensed Sharpies to use two inventions, upon payment of a royalty of $1.00 per machine for the use of each invention. For some nine years, the royalties were paid as stipulated. A difference of opinion then arose as to the assignments of various patents. McCornack was willing to assign all that were requested, except No. 699,217, that one being included in the royalty contract. Sharpies contended that he was entitled to it, alleging that the invention set forth and described in it was made at a period when McCornack was bound under the terms of an agreement to convey to Sharpies everything he should then invent. The referee and the court below found against this contention of Sharpies, and sustained the claim of McCornack for royalties under this patent. Interest upon the royalties was, however, denied, upon the ground that the controversy was over an honest difference of opinion, and that, the refusal to pay was in good faith. We cannot agree that this was a sufficient reason. “A bona fide dispute as to the amount of indebtedness is no bar to the accruing of interest. If a tender of payment falls
The assignments of error, are sustained, and it is ordered and directed that the decree of the court below be modified, so that interest upon the royalties shall be allowed from the time when they became due, and further that the disposition of the costs in the court below shall be in accordance with the report of the referee. The costs of this appeal to be borne by the appellee, P. M. Sharpies. It is ordered that the record be returned to the court below for further proceedings in accordance with this opinion.
Reference
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- Syllabus
- Equity — Royalties—Withholding payments — Good faith — Interest — Costs. 1. A bona fide dispute as to tbe amount of indebtedness is no bar to the accruing of interest. If a tender of payment falls short of the sum found to be due at the time of tender, interest runs on the whole. 2. Interest upon unpaid installments of royalty due from time to time for the use of a patent, is properly allowed in a suit for the royalty although the payments were withheld in good faith, and as the result of a controversy over an honest difference of opinion as to the right of the patentee to the royalty., 3. In a suit in equity for the assignment of a patent where defendant filed a cross bill for an accounting for royalties due from plaintiff and where none of plaintiff’s contentions are sustained, but where on the contrary it appears that a large sum is due from plaintiff to defendant, the entire costs should be imposed upon plaintiff.