Davies v. Racer — 79 N.Y. Sup. Ct. 43

Majority

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Alfred Davies and Others, Respondents, v. Herman Fred Racer, Appellant.

Headnote

Limited agreement by a clerk not to engage in a similar business to that of his employer — enfoi'cement of the agreement by injunction.

lu an action brought to obtain an injunction to prevent the defendant from interfering with the plaintiffs’ customers by solicitation of their business, on behalf of his present employers, in violation of his agreement with the plaintiffs, it appeared that plaintiffs, a firm of forwarding' agents and custom-house brokers in New York city, had entered into an agreement with the defendant whereby the firnp. employed the defendant as a clerk to receive, influence and procure orders and goods from shippers and to perform other duties, in consideration of a salary therein expressed, and that the defendant thereby agreed not to engage in the city of New York, or within fifty miles thereof, either directly or indirectly, in a similar business to that carried onrby the plaintiffs, or to interfere with any of the plaintiffs’ customers, directly or indirectly, for twelve months after the expiration of the agreement.

The agreement continued in existence until the defendant voluntarily left the plaintiffs’ employment and made an engagement with another firm in New York city carrying on a business similar to that of the plaintiffs.

Meld, on appeal from an order continuing an injunction during the pendency of the action, or until one year from the expiration of the agreement, that the

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agreement was not in restraint of trade or unreasonable, and that the defendant’s employment was a sufficient consideration to support it.

The defendant insisted that there was no evidence that the plaintiffs had suffered or would suffer such great or irreparable injury as would warrant the granting of an injunction.

Meld, that as it was clear that there had been a plain and willful violation upon the part of the defendant of the covenants contained in his agreement, it required but slight evidence of injury to justify the court in restraining such acts, it being apparent that it was impossible to calculate their results.

Appeal by tlie defendant, Herman Fred Racer, from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the city and county of New York on the 24th day of March, 1893, enjoining and restraining the defendant, “ during the pendency of this action, or until the 29th day of December, 1893, if the same shall have not been tried before that date, from engaging as clerk or otherwise, in any business similar to that carried on by the plaintiffs’ firm of Davies, Turner & Co., and from interfering with the customers of the plaintiffs as they existed on the 29th day of December, 1892, by soliciting business from them, directly or indirectly.”

The action was brought in February, 1893, to obtain an injunction restraining the defendant from the acts above specified, until the 29th day of December, 1893.

W. P. Burr, for the appellant.

II. II. Whitman, for the respondents.

There seems to be little to add to the opinion rendered in the •court below. But it may be necessary to notice one or two points which have been urged upoh this appeal.

It appears that on the 1st of June, 1881, the plaintiffs, who are 'engaged in the business of forwarding agents and custom-house brokers, entered into an agreement with the defendant, whereby said firm employed the defendant as clerk to receive, influence and procure orders and goods from shippers in New York city and elsewhere, and to perform other duties in consideration of a salary therein expressed. In and by said agreement, the said defendant agreed not to engage in the city of New York, or within fifty miles thereof, either directly or indirectly, in a similar business to that

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carried on by the plaintiffs, or to interfere witli any of the plaintiffs’ customers, directly or indirectly, for tbe space of twelve months after the expiration of the agreement. Said agreement was con-tinned in existence until on or about the 29th of December, 1892, when the defendant voluntarily left the plaintiffs’ employment and engaged as a clerk with a firm in New York doing business similar to that of the plaintiffs, and, it is alleged, interfered with the customers of the plaintiffs by systematic solicitation of their business on behalf of said Arm, and that such solicitation was in open violation of defendant’s said agreement.

There was evidence tending to show the existence of this state of facts. But it is urged upon the part of the appellant that there was no evidence that the plaintiffs have suffered or will suffer such great or irreparable injury as will warrant the granting of this injunction.

It is undoubtedly true that the evidence in this regard is slight. But there certainly is evidence from which the conclusion might be drawn that the plaintiffs may suffer injury from the actions of the defendant. It appears beyond contradiction that he is soliciting-custom from those who have been accustomed to deal with the plaintiffs, and that some of these customers have ceased dealing with the plaintiffs, although they allege they would have ceased dealing with the plaintiffs, even though the defendant had not solicited the change. It is naturally difficult to establish the effect of the mental operations which have brought about the change in the action of these customers; but it is apparent that there has been a plain and willful violation upon the part of the defendant of the covenants contained in his agreement. And it requires but slight evidence of injury to justify the court in restraining such acts, it being apparent that it is impossible to calculate what may be the results of such action.

It is also urged that the covenant is in restraint of trade, and was not supported by a good consideration, and unreasonable in view of the circumstances disclosed, and, therefore, void.

As to the agreement being in restraint of trade, it seems to be difficult to support any such proposition in view of the principles enunciated by the Court of Appeals in the case of The Diamond Match Co. v. Doeber ( 106 N. Y. 473 ), where a very much broader contract was enforced.

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As to the want of consideration, the fact of the employment was sufficient consideration. It enabled the defendant to become familiar with the customers and the trade of the plaintiffs, and they had a right to protect themselves by such a covenant against sncli knowledge being used to their disadvantage.

As to the policy of the law being against the restraint of clerks, mechanics and apprentices from pursuing their jirofession or employment in any particular place, it seems to be sufficient to say that no rule laid down in this State has been called to our attention which in any way militates against the validity or propriety of such an agreement as forms the subject-matter of this action.

We think, therefore, that the order should be affirmed, with ten dollars costs and disbursements.

Follett and Parker, JJ\, concurred.

Order affirmed, with ten dollars costs and disbursements.

Cases cited

Diamond Match Co. v. Roeber 106 N. Y. 473 N.Y. 1887-10-04 p. 45