Association of Contracting Plumbers of the City of New York, Inc. v. Contracting Plumbers Ass'n of Brooklyn & Queens, Inc.

The question presented on this appeal concerns the measure of proof required to justify the summary remedy provided by section 964 of the Penal Law (L. 1937, ch. 638). It turns on whether an order granted on affidavits alone, without a trial, permanently restraining and enjoining the appellant-respondent from the use of the name “ Contracting Plumbers Association of Brooklyn and Queens, Inc.” and particularly the words “ Contracting" Plumbers Association ” either alone or in conjunction with other words, was justified.

We think not. When the Legislature enacted section 964 of the Penal Law, it provided a new and summary proceeding not heretofore available by which an aggrieved party in a proper case, could obtain speedy and drastic relief without the delays incident to a plenary action (Matter of Julius Restaurant v. Lombardi, 282 N. Y. 126 ). This is not to say, however, that compliance with basic evidentiary rules may be dispensed with. The very nature of the remedy — a permanent injunction — to be had without a trial on affidavits alone — requires that it be invoked only when the right thereto is established in a clear and convincing manner. Where basic factual allegations of violation are controverted summary relief may be denied (Matter of Alexander’s Dept. Stores v. Cohen, 269 App. Div. 117 , revd. 295 N. Y. 557 ).

Both parties hereto are local nonprofit trade associations incorporated under section 2 of the New York State Membership Corporations Law (L. 1926, ch. 722, as amd.), for the purpose of promoting the interest and welfare of their members in the plumbing business and with other trade associations in the plumbing business. In practice, however, the principal activity is in the field of labor relations and acting as collective bargaining agent in the negotiation, making and supervision of employment contracts with local trade unions.

The petition also alleges that its members perform a considerable portion of all plumbing work done in New York City; that it is recognized as the collective bargaining agent for the plumbing industry by the building trade employers’ association of New York City; that it is the collective bargaining agent in a contract with Local Union No. 1 of the United Journeymen, Plumbers, Gas Fitters and Apprentices of the United States and Canada and that it shares in the administration of a welfare fund established under such agreement.

The petitioner alleges that by use in its name by the respondent of the words “ Contracting Plumbers Association ” it has appropriated and intends to appropriate in. substantial part the name, good will and prestige of petitioner and thereby create the impression that it is a branch or an affiliate of the petitioner and that such action on its part “ tends to mislead and deceive the public ” particularly in the building industry.

The opposing affidavits generally deny any such intent or purpose and, on the contrary, allege circumstances which it is claimed show its good faith and a right to use its name. That in the first instance it had submitted the name “ Brooklyn and

The threshold question as to the availability of section 964 in a nonprofit trade association dispute as distinguished from commercial or trading corporations finds its answer in the initial words of the statute declaring: “No * * * corporation shall * * * use as * * * a corporate * * * name, for advertising purposes, or * * * for any other purpose, any name * * * which may deceive or mislead the public ”. (Emphasis supplied.)

Legislative intent is best gathered by according the language employed its usual and ordinary meaning. When so read the generality of the language here employed is broad enough to include both parties. The statute creates no new legal principle— at common law equity afforded a remedy for misuse of name in unfair competition which was not confined to commercial disputes. It included nonprofit corporations (B. P. O. E. v. Improved B. P. O. E., 205 N. Y. 459 , 464; National Circle, Daughters of Isabella v. National Order of Daughters of Isabella, 270 F. 723 ). The parties here even though organized as nonprofit trade associations, are in a sense competitors, serving as they do a membership of licensed plumbers (cf. International News Service v. Associated Press, 248 U. S. 215 ).

In reaching this conclusion we have not overlooked certain lower court decisions which gave the impression without so ruling, that the statutory remedy was limited to cases involving commercial fraud (Matter of Hirsch v. Perlman, 268 App. Div.

The proof here, as we view it, falls far short of the expressed showing that the words “ Contracting Plumbers Association ” as used are violative of section 964.

The statute so far as pertinent, provides: “No * * * corporation shall, with intent to deceive or mislead the public, asume, adopt or use as * * * a corporate * * * name, for advertising purposes, or for the purposes of trade, or for any other purpose, any name * * * or a part of any name * * * which may deceive or mislead the public as to the identity of such * * * corporation or as to the connection of such * * * corporation with any other * * * corporation ”. (Emphasis supplied.)

This, like many other legislative enactments, must be considered as a comprehensive effort to deal with the consequences of a single act either as a criminal offense or a civil wrong, depending upon its public impact. Severability depends upon circumstances but the substantive definition is equally applicable to either situation which is, “No * * corporation shall, with intent to deceive or mislead the public * * * use * * * a * * * name ’ ’. The significance and importance of this essential element is not extinguished by the latter provision that “ an injunction may be issued * * * without requiring proof that any person has in fact been deceived or misled thereby.” This latter provision is meaningless when lifted out of context. It must be read as part of the whole and when so read it becomes crystal clear why proof “ that any person has in fact been deceived or misled thereby ” is dispensed with. The wrong is in the use with intent. When that is established a case for summary relief is made out. Here the proof falls short of such a showing. In fact the answering affidavits tend to show the contrary.

The controverted name had the approval of the Secretary of State, the State and National Association of Master Plumbers, together with a large segment of the plumbing industry doing business in the boroughs of Brooklyn and Queens. It appears

The orders should be reversed and the petition dismissed, without costs, and without prejudice to the commencement of an appropriate action in equity.

Loughran, Ch. J., Lewis, Conway, Desmond, Fuld and Froessel, JJ., concur.

Orders reversed, etc.