Standard Fashion Co. v. Siegel-Cooper Co.

The contention that it does not appear from the complaint that there is no adequate remedy at law, we do not think is sustained; for whatever may be the rule as to the extent of proof which, in support of that allegation, the plaintiff must present upon the trial, a more liberal rule must be indulged in, in determining the sufficiency of the complaint upon demurrer. It is in effect alleged that the plaintiff has no adequate remedy at law, and that is sufficient.

The further contention that the contract relied upon is not one which the court can decree should be specifically performed, because the business would be of a continuous nature, and thus brought un

“The question, therefore, is whether a case for specific performance is here made out; and that depends, in the first instance, upon the nature of the contract sought to be enforced. The general rule is not to decree a specific performance of contracts which by their terms stipulate for a succession of acts whose performance cannot be consummated by one transaction, but will be continuous, and will require protracted supervision and direction.”

It appears that there was an exclusive contract made with the plaintiff, but it does not appear that an attempt was made to prevent the defendants entering into a contract with some one else. What was sought in the action was a preliminary and final mandatory injunction, compelling the defendant to carry out its contract. The precise question here involved, as to the right of the court to enforce by injunction the negative covenants, was not there presented nor decided. The relief here demanded is twofold, namely, to compel the defendant the Siegel-Cooper Company specifically to perform, and to prevent that company from selling, or permitting any rival or competitor of the plaintiff to sell on the premises, during the term of the contract, any other make of paper patterns. The right of a court of equity to prevent the violation of negative covenants contained in a contract which, in its entirety, it could not decree should not be specifically performed, is not a new question; and, although

“The two points of law are not without difficulty. The relief asked is specific performance and injunction. It is argued -with great ability by the defendants that the complainant is not entitled to specific performance, and that, therefore, it cannot have an injunction which is merely auxiliary. Granting the premises, I am not prepared to concede the conclusion. If the court cannot order a contract for the making of buttonhole machines to be specifically performed, by reason of the impossibility of superintending the details of such a business, it does not follow that the bill may not be retained as an injunction bill. It was formerly thought that an injunction would not be granted to restrain the breach of any contract unless the contract were of such a character that the court could fully enforce the performance of it on both sides.”

And the judge writing the opinion in that case, after an examination of all the cases, thus concluded:

“I think the fair result of the later cases may be thus expressed: If the case is one in which the negative remedy of injunction will do substantial justice between the parties, by 'obliging the defendant either to carry out his contract or lose all benefit of the breach, and the remedy at law is inadequate, and there is no reason of policy against it, the court will interfere to restrain conduct which is contrary to the contract, although it may be unable to enforce a specific performance of it. * * * The court cannot, perhaps, superintend the performance of a Contract to manufacture machines, but it can restrain the defendants from selling in violation of their agreement.”

And in Chicago & A. Ry. Co. v. New York, L. E. & W. R. Co., 24 Fed. 521 , it is said:

“It is one thing, however, to stop a party from doing that which he cannot rightfully do, and another to undertake to compel him to do an act involving the exercise of faculties and judgment which are peculiar and personal to himself; and the argument from inconvenience which may properly be invoked when the court is asked to decree a specific performance would, if it should be controlling when the court is asked to restrain the doing of an unlawful act, apply to all cases in which the corrective power by injunction is exercised.”

That a departure has been made from the rule laid down in the earlier cases, even to the extent of decreeing the specific performance of a continuous contract with varied and extensive details, requiring the frequent intervention of the court, is further shown by two other cases, one in the supreme court of the United States, which has been followed by our own court of appeals: Joy v. St. Louis, 138 U. S. 1 , 11 Sup. Ct. 243 ; Prospect Park & C. I. R. Co. v. Coney Island & B. R. Co., 144 N. Y. 152 , 39 N. E. 17 . It is urged, however, by the respondents, that these cases are exceptions to the principle laid down in the earlier cases, wherein the courts, departing from the general rule, have decreed specific performance of contracts.relative to the management of railroads, on the ground that, railroads being public functionaries, this burden should be assumed by the court, not out of consideration for the plaintiff, but out of regard for the rights of the public at large. Though we regard these as exceptions

“Equity has followed the true principle of contriving its remedies so that they shall correspond both to the primary right of the injured party, and to the wrong by which that right has been violated. It has therefore never placed any limits to the remedies which it can grant, either with regard to their substance, their form, or their extent, but has always preserved the elements of flexibility and expansiveness, so that new ones may be invented, or old ones modified, in order to meet the requirements of every case, and to satisfy the needs of a progressive social condition, in which new primary rights and duties are constantly arising, and new kinds of wrongs are constantly committed.”

It cannot be doubted that courts are instituted to enforce rights, to redress injuries, and to restrain contemplated wrongs; and it is difficult to see any sound reason which should prevent a court from granting any relief because it cannot give all the relief to which the party may be entitled. We think that no sound principle is violated in holding that the court should extend its relief as far as it is able, and where it cannot, as in this case, enforce the specific performance of the affirmative covenants by compelling the defendant to carry out its contract, it has the power, and it should exercise it, to prevent the defendant the Siegel-Cooper Company from obtaining an advantage from a breach of its agreement, and inflicting a double wrong—First, in depriving plaintiff of the right to sell; and, secondly, by conferring such rights on a business competitor.

In addition to railroad cases, we are all familiar with others, affecting singers, actors, and persons skilled in particular arts, wherein it was held that, though the court could not compel them to perform their agreement, it would prevent the employment of their talent or skill for others during the contract term. It is insisted, however, that these, like the railroad cases, are exceptions to the general rule, and that they are to be distinguished from the case of a contract such as is here involved, upon the ground, as claimed, that in all these cases the injunction practically amounted to a complete decree of specific performance of the contract, and that the enforcement of the negative covenant, express or implied, covered the whole ground of controversy between the parties, while here negative covenants are but a portion of the contract, and that it would be inequitable to enforce a part without enforcing the whole. We do not regard the distinction thus sought to be made as sound, because the cases referred to cannot be reconciled upon the theory that the enforcement of the negative covenant, enjoining a person from exhibiting his skill for anyone else, was a complete enforcement of a contract which required the exhibition of such personal services on behalf of the one in whose favor the injunction

“Why should not the plaintiff in such a case have an injunction? His contract rights are clear, the proposed violation of them is clear, and here is a remedy not impracticable. It would seem to he a sound general rule that where the right of one party is plain, and the wrong done or intended to be done by the other equally plain, the court should not be sparing in the application of its remedies, but rather should grant them with a liberal hand.”

In view of the very extended and able discussion which the question here involved has received in a number of cases, which we. may concede cannot be reconciled, it is unnecessary to extend this opinion; being entirely satisfied to rest it upon the reasoning and the cases cited in the decision from which we have already quoted, of Singer Sewing-Mach. Co. v. Union Buttonhole & Embroidery Co., supra.

As to the defendant the Butterick Company, which separately demurs, the complaint alleges, in substance, that, with knowledge of the existence of the contract between the plaintiff and the SiegelCooper Company, it induced the Siegel-Cooper Company to break its agreement with plaintiff, and promised to save such company harmless because of such breach, and further agreed to defend at its own cost and expense any action that might be brought against that company because of the breach. To permit the Butterick Company, upon the facts alleged, to obtain a benefit, would be to allow it to profit by its own wrong. In New York Bank-Note Company v. Hamilton Bank-Note Engraving & Printing Co., 50 N. Y. Supp. 1093 , this court decided (April 15, 1898) that, where there was an exclusive contract between the plaintiff and one defendant, the plaintiff, as against the other defendant, who, with notice of the plaintiff’s rights, had contracted with its co-defendant, was entitled to relief, upon the ground, not of any contractual relation, but that such other defendant had engaged knowingly in a plan or contract to wrong and injure the plaintiff.

Taking the facts stated in the complaint, therefore, as true, we think that the plaintiff was entitled to relief by way of injunction to restrain the violation of the negative covenant contained in the contract, and that the decision below, that the plaintiff was entitled to no relief, was error. The judgment, accordingly, should be reversed, with costs to the appellant, with leave, however, to the defendants to withdraw demurrers, and answer over, on payment of costs. All concur, except INGRAHAM, J., dissenting.

I dissent. The action is brought specifically to enforce an agreement made between the plaintiff and the defendant Siegel-Cooper Company. The demand for relief is that it be adjudged and decreed that the defendant Siegel-Cooper Company carry out its said agreement with plaintiff, and specifically perform

“Suffice It to say that the contract is exceedingly comprehensive, and that its working details are most minute. These details almost invariably provide for special and varying contingencies, and the elements of discretion and judgment with regard to such contingencies abound. It is apparent that the due execution of such a contract must involve the ascertainment of what it is right and proper that the parties should do from day to day with regard to ever-varying circumstances. A decree for specific performance, couched! in the precise terms of the contract itself, would be but the beginning of the judicial work.”

And as was said by Mr. Justice Strong in Marble Co. v. Ripley, 10 Wall. 358 :

“Another serious objection to a decree for a specific performance is found in the peculiar character of the contract itself, and in the duties which it requires of the owners of the quarries. These duties are continuous. They involve skill, personal labor, and cultivated judgment. It is, in effect, & personal contract to deliver marble of certain kinds, and in blocks of a kind, that the court is incapable of determining whether they accord with the contract or not. The agreement being for a perpetual supply of marble, no decree the court can make will end the controversy.”

The rule covering specific performance of contracts- of this character is stated in the American and English Encyclopaedia of Law (volume 22, p. 1002) as follows:

“The specific performance of a contract of personal service will not be enforced, for there is no practical means of executing the decree. Contracts, to be performed in the remote future, or the execution of which involves the-performance of a continuous and protracted series of acts, oi’othe doing of some act or thing which demands the exercise of the individual skill, discretion, taste, or talent of the promisor, are, of necessity, incapable of judicial supervision or control. For the breach of such agreements the party injured, must be left to his remedy in a court of law.”

And the cases cited in the note to this statement of the rule-show that it has been almost universally applied in the courts of this country and in England. . While this is conceded to be the general rule, it is claimed that certain exceptions have been recognized, and that where the contract contains a negative covenant, although the affirmative covenant could not be enforced, a court will enforce the negative covenant by injunction;, but the cases in which such a negative covenant have been enforced involved a performance of a defined class of contracts,, where- the services to be rendered or the contract to be performed required the performance of certain specific acts, which could he performed only by the defendants, and were based upon the decision of the case of Lumley v. Wagner, 1 De Gex, M. & G. 604. In that case a singer had agreed to sing at the plaintiff’s theater for three months, and not to sing at any other; and the court enjoined her from performing at a rival establishment, though it was clear and "was admitted that the court could not oblige her to sing for the plaintiff. It will be noticed that the exceptions to the general rule have been in cases where the obligation to be performed on the part of the plaintiff was one that could be specifically performed by the court, or where the defendant would have had a right of action in damages for a failure to perform, which would have been adequate and easily ascertained, and would have af

The allegation of the complaint, and the one fact urged by the-plaintiff as the basis of its right to maintain this action, is that there could be no adequate remedy at law, because it would be impossible to ascertain the damage that would flow to either party from a breach of the contract by the other party. We have seen that, from the nature of the contract, it would be impossible for the court to specifically perform it. If the plaintiff neglected and refused to perform the contract on its part,—failed to provide the-necessary material for carrying on the business, and the employés to carry it on,—admitting the allegations of the complaint to be' true, the defendant could have no remedy at law for a breach of the contract, as no damage could be proved to have resulted from-such a breach. It could have no remedy by specific performance, as the contract is of such a nature that specific performance cannot’