76 N.J. Eq. 1 | New York Court of Chancery | 1909
At the hearing I gave orally my views to some extent on the rights of the parties, reserving final determination for briefs on the following points—first, whether in the Ferry-Waring Company suit, referred to at the hearing, it had been expressly decided that the complainant’s patents, or any of them, covered “stays” as well as “rings,” and second, whether complainant’s representation or claim at the time of procuring the license, that “stays” were covered by its patents, made to defendant under the circumstances proved, was such a representation of fact on which defendants were entitled to rely in making the contract, that defendants on proving its falsity were discharged from the obligation to pay royalty under the contract, and were entitled to rescind the contract.
Briefs have been submitted on these points, and on further consideration of the cause, I add the following brief statement to the views expressed at the hearing. The opinion of Judge Lacombe in the Ferry-Waring Company suit does not expressly decide the issue now raised, as to the distinction between “stays” and “rings” under the Ferry patents, nor was that issue precisely raised. It is not therefore conclusive on the question, and its bearing on this question is therefore to be considered only in connection with the evidence given at the hearing upon this subject.
The general principle is that the licensee, to the extent that he continues to use the license, is estopped from denying the licensor’s title. Clark v. Adie, 2 L. R. 423; App. Cas. (1877) ; Jones v. Burnham, 67 Me. 93; 24 Am. Rep. 10 (1877); Kinsman v. Parkhurst, 18 How. (U. S.) 289.
This applies the same principle which estops a tenant from denying the landlord’s title to the land occupied under the lease, and is an estoppel implied by law, even in the absence of an express estoppel, such as was made by the agreement here. If the defendants have the right, for fraud or otherwise, to repudiate the license, thus making themselves liable to suit as infringers, the repudiation in such case must be total and of all the privileges granted. They cannot, at the same time, claim under and against the agreement. In the present case, the agreement granted the right to use the Halloek machines for rings and fixed the royalties for both rings and stays on a basis which did not depend on the actual making of either stays or rings, and these entire royalties are due, under the agreement, if the defendants use any of the privileges conferred by the license, and do not expressly repudiate them all. Defendants admit the use of these privileges for making “rings” and offer to account for these, but
I will advise a decree for accounting under the agreement, to be settled on notice, if necessary, and that the cross-bill be dismissed.