224 P. 1022 | Cal. Ct. App. | 1924
The defendant has appealed from a judgment restraining him "from further engaging in the undertaking business, or business similar thereto, in the city of Fresno, so long as plaintiffs, or any person deriving title to the good will of said business from plaintiffs, carry on said or like business in said city of Fresno."
There is no substantial conflict in the evidence. For many years the plaintiffs and defendant were partners in the business of general undertakers and funeral directors in the city of Fresno, under the firm name of Stephens Bean. On the thirty-first day of May, 1919, the defendant sold his interest in the business and property of the firm to the plaintiffs for the sum of thirty-five thousand dollars and executed the following instrument of transfer:
"State of California, County of Fresno, — ss.
"Know all men by these presents: that I, W. A. Bean, of the city of Fresno, County of Fresno, State of California, *781 am the owner of one-half (1/2) interest in the undertaking firm of Stephens Bean, located and doing business in the said City and County.
"Be it further known: That for, and in consideration of the sum of One Hundred and no/100 ($100.00) Dollars, receipt of which is hereby acknowledged, I do sell, assign and transfer to L. O. Stephens and J. D. Stephens of the same place, my undivided one-half (1/2) interest in the aforesaid undertaking firm of Stephens Bean, together with my interest in all stock, furniture, fixtures, securities, notes, book accounts and etc. now due said firm.
"Signed, sealed and dated at Fresno, this thirty-first day of May, 1919.
"W. A. BEAN.
"Subscribed and sworn to before me this 31st day of May, 1919.
"GLADYS G. WATSON.
"Notary Public in and for the County of Fresno, State of California.
"I further agree to not at any time in the future enter into business in competition to the above mentioned firm of Stephens Bean.
"(Signed) W. A. BEAN."
The defendant testified that he had been in the undertaking business with the firm of Stephens Bean for twenty-five or thirty years; that at the time of the trial, November 15, 1922, he was in the employ of the Mission Undertaking Company, a corporation, undertakers and funeral directors in the city of Fresno, and had been in the employ of such corporation since the first of April, 1922; that he assists in cleaning up, in making death calls and in conducting funerals and, in the absence of the manager, he sometimes takes charge of funerals; that the business is transacted by the manager, a lady attendant and defendant, all of whom are paid salaries and receive commissions on the amount of business transacted; and that defendant was consulted in the preparation of advertising matter which was published in the newspapers of Fresno. These advertisements may be said to "feature" the defendant. A description of one of them will serve to illustrate their nature. It contained pictures of the undertaking parlors, *782 the defendant, the manager and the lady attendant, underneath which appeared the following:
"Mission Undertaking Parlors, Announcing a Change in
Name of the Powell Undertaking Company, to the
Mission Undertaking Company.
"Mr. R. A. Powell, having severed his connection with this undertaking concern, the directors wish to announce to the public that in the future it will be known as the Mission Undertaking Parlors, and associated with it are William A. Bean, J. Herman Kennedy and Mrs. Anna (Erickson) McIntyre, all of whom are licensed embalmers and experienced funeral directors.
"Wm. A. Bean: Mr. Bean was formerly with Stephens Bean, and has had over 30 years' experience in the business, 28 years of which have been in the city of Fresno, having served as coroner of Fresno County for 12 years. During his 30 years' experience in the undertaking business he has established a reputation for himself as being one of the leading funeral directors of the state, having arranged and directed some of the largest funerals ever held in the city of Fresno." This is followed by similar statements concerning the experience and standing of Mr. Kennedy and Mrs. McIntyre.
Appellant contends that his covenant not to engage in the undertaking business is void because in restraint of trade and, further, that he is not engaged in such business. Section 1673 of the Civil Code provides: "Every contract by which anyone is restrained from exercising a lawful profession, trade, or business of any kind, otherwise than is provided by the next two sections, is to that extent void." Section 1674 provides: "One who sells the good will of a business may agree with the buyer to refrain from carrying on a similar business within a specified county, city, or a part thereof, so long as the buyer, or any person deriving title to the good will from him, carries on a like business therein." Defendant's covenant does not expressly contain the limitations of section 1674 as to time, territory, or the nature of the business which defendant agrees not to carry on.
In Brown v. Kling,
[1] Defendant's covenant is not expressly limited to the city or county in which the business sold was being conducted. No sound reason appears, however, why the intention of the parties may not be ascertained, as in other agreements, from a consideration of the terms of the contract as a whole, viewed in the light of the surrounding circumstances. The contract recites that the defendant, "of the City of Fresno, County of Fresno," is the owner of a one-half interest in the undertaking firm of Stephens Bean, "located and doing business in the said city and county." The business, in its nature, is local. Any business other than local, therefore, in which defendant might engage, would not be in competition with that of plaintiffs. The case is unlike those of manufacturing concerns and wholesale merchants whose goods are sold and distributed over large territories. The court was justified in concluding that it was the intention of the parties that the restraint imposed upon defendant was applicable only to the city of *784
Fresno. In Brown v. Kling, supra, it is said: "In Moore etc.Co. v. Towers etc. Co.,
[2] Defendant's covenant is that he will not "enter into business in competition to the above mentioned firm," without limitation as to the kind of business restricted. Since the firm is mentioned in the contract as an "undertaking firm," the covenant may reasonably be construed as an agreement not to engage in the undertaking business, but in any event the statute limits the restriction to a "similar business." InShafer v. Sloan,
[3] Appellant's contention that he is not engaged in the undertaking business is so manifestly without merit that it requires but little consideration. "The provisions of the code authorize the execution of a contract by which one agrees not 'to carry on' a similar business. It is too narrow a construction to say that this is limited to the carrying on of a business as owner or proprietor. To conduct, manage or operate it wholly or in part, as the agent of another, is equally within the purpose and language of the code." (6 Cal. Jur. 142; Meyers v. Merillion,
The judgment is affirmed.
Plummer, J., and Hart, J., concurred.
A petition by appellant to have the cause heard in the supreme court, after judgment in the district court of appeal, was denied by the supreme court on April 24, 1924.
All the Justices concurred.