Cottington v. Swan

SiebéoiceR, J.

The only ground of objection urged to the complaint is that the contract upon which recovery is claimed by the plaintiff is in restraint of trade and the courts therefore will not enforce it nor consider the question of injury resulting from its breach. Contracts in restraint of trade have been repeatedly considered by this court and held to be void as against public policy, “unless limited, as to time, space, and extent of trade, to what is reasonable under the circumstances of the case, because they tend to deprive the public of the services of the persons in those capacities in which they are most useful, and also tend to expose the public to the evils of monopoly.” Tecktonius v. Scott, 110 Wis. 441 , 86 N. W. 672 . Condemnation of contracts of this nature has been quite universal by the courts, upon the ground that no person should be permitted to so contract as to preclude himself from following a lawful occupation for the benefit of himself and of those dependent upon him, or to deprive the public of his industry. The vital question in the consideration of every such contract is'whether the restraint imposed is reasonable under the circumstances with reference to “the situation, business, and objects of the parties,” and if '“the restraint contracted for appears to have been for a just and honest purpose, for the protection' of the legitimate interests of the party in whose favor it is imposed, reasonable as between them and not specially injurious to the public, the restraint will be held valid.” Hubbard v. Miller, 27 Mich. 15 ; Oregon S. Nav. Co. v. Winsor, 20 Wall. 64. In the *324 following cases in tbis court involving contracts of this kind the determination rested upon these grounds, and if the restriction was found reasonable and just the contracts were sustained as valid; if they unreasonably restricted the parties-so as to restrain them from pursuing their occupations or deprived the public of their industry they were held invalid l Kellogg v. Larkin, 3 Pin. 123 ; Laubenheimer v. Mann, 17 Wis. 542 ; Washburn v. Dosch, 68 Wis. 436 , 32 N. W. 551 ; Berlin M. Works v. Perry, 71 Wis. 495 , 38 N. W. 82 ; Richards v. Am. D. & S. Co. 87 Wis. 503 , 58 N. W. 787 ; Palmer v. Toms, 96 Wis. 367 , 71 N. W. 654 .

Under the contract in question defendant sold his livery business and its good will to plaintiff and Ackley for a valuable consideration and agreed not to engage in that business directly or indirectly in the village of Bloomer while the purchasers or either of them “or their heirs, executors or administrators [should] be engaged in such business within said-village.” It is apparent that the restraint contracted for was a material consideration in inducing plaintiff and his associate to make this purchase from the defendant for the purpose-of conducting a livery business in this village, and, under the circumstances, it seems reasonable to assume that defendant could not have secured the consideration obtained for such-sale but for the covenant not to engage in such a business in the village of Bloomer. That these considerations must have entered into the making of this contract is apparent from its-terms. Are' its terms unreasonably restrictive, and is the public thereby deprived of defendant's industry ? Manifestly he is not precluded from pursuing this business anywhere outside of this village, and he may engage in any other business within or outside of the village. Under its terms the village may have this very business continued within its limits,, for the agreement is that he shall not engage in it so long as it is conducted and carried on by the purchasers or their personal representatives or heirs. If they cease to conduct this- *325 business at any time, immediate or remote, then defendant may conduct it without restraint. Tbe claim that such restraint would tend to subject tbe public of tbis village to a monopoly in tbis business as conducted by plaintiff is-rather a remote speculation, for tbis field'of enterprise for conducting sueb a business and competing with plaintiff for tbe public patronage is open to tbe whole world. Viewing tbe restrictive provision of tbis contract as applied to tbe situation of tbe parties it is manifest that it was made for tbe honest purpose of affording a reasonable and fair protection to tbe interests of tbe plaintiff in whose favor it was made, and that it was a reasonable one as between them. Under these circumstances and conditions we do not find that the restriction imposed is unreasonable in its operation and likely to cause injury to the public, nor is it an unreasonable restraint upon defendant in the pursuit of his occupation. This makes it a valid contract and entitles plaintiff to relief if defendant has breached it and caused him injury. In tbe following cases similar contracts have been passed upon and held to be reasonable in their restraint as to time and space and therefore valid: Cook v. Johnson, 47 Conn. 175 ; Dakin v. Williams, 17 Wend. 447 ; Beal v. Chase, 31 Mich. 490 ; Warfield v. Booth, 33 Md. 63 ; Linn v. Sigsbee, 67 Ill. 75 ; Angier v. Webber, 14 Allen, 211 , 92 Am. Dec. 748 , with a full note.

By the Court. — The order appealed from is reversed, and the cause remanded with directions to enter an order overruling the demurrer and for further proceedings according to law.