164 Pa. 35 | Pa. | 1894
Opinion by
The bill in this case was for an injunction to restrain defendant from practicing as a physician within eight miles of Lehman Centre, in Luzerne county, for a period of ten years from 6th of February, 1888.
It appeared, from the bill, answer and testimony, that Dr. Colley, the defendant, had been a practicing physician at Lehman Centre from 1876 until 6th Feburary, 1888. Dr. Wilkinson, the plaintiff, was a younger man, and had commenced the study of medicine with Colley in spring of 1883, when only twenty-two years of age; afterwards, in March, 1885, he graduated from the College of Physicians and Surgeons at Baltimore. He then returned to Lehman Centre and formed a partnership with Colley in the practice of medicine. At the expiration of a year, the partnership was dissolved, and Wilkinson continued in the practice for himself, down to the 6th of Feb
Wilkinson paid the full consideration, and Colley removed to Columbia county, but in less than four years returned to Lehman Centre, and commenced again to practice medicine there. Wilkinson notified him that he was violating his contract, and requested him to stop practice, but Colley persisted; even sent cards to a large number of Wilkinson’s patients, inviting their patronage. Thereupon Wilkinson filed this bill, averring the facts as stated, and praying for an injunction.
The answer of Colley admits the execution of the agreement, and the pavement of the consideration; admits that he resumed practice in Lehman, and the manufacture and sale of medicine; but sets up a parol understanding or agreement with Wilkinson, that he was to return if he paid back the consideration, and averring the four hundred dollars designated as a penalty in the agreement, is liquidated damages, and further averring his readiness and ability to pay the same.
When the bill was filed, a preliminary injunction was awarded, which was afterwards, in an opinion filed by Presiding Judge Woodward, dissolved, and the case sent for hearing to a master, who, on the authorit}'- of the opinion already filed, dissol v
The decree of the learned judge of the court below is based upon two conclusions : 1. That the penal sum of four hundred dollars in the contract, is to be treated as damages liquidated by the parties.- 2. That the plaintiff has an adequate remedy at-law for the breach of the contract. It follows that if the first conclusion, that the penalty of $400 is liquidated damages, be correct, the second is also correct. For all difficulty in liquidating damages, which from the very nature of the contract is otherwise great or impossible, is removed by the express stipulation of the parties that the damages shall be fixed at $400. The remedy at law for the recovery of a sum certain is complete and adequate.
.. The question then recurs, was it the intention of the parties that Colley was not to practice again for ten years, or that he was to have the privilege of practicing on payment to Wilkinson of $400 ?
It is said by Agnew, J., in delivering the opinion of the Court in Streeper v. Williams, 48 Pa. 450, where the contention was as to whether the words “ forfeit the sum of $500, in case either party fail to comply with the terms of this agreement,” was a penalty dr liquidated damages, that: “ Upon no question have courts doubted and differed more. It is unnecessary to examine the numerous authorities in detail, for they are neither uniform nor consistent. No definite rule to determine the question is furnished by them, each being determined more in direct-reference to its own facts than to any general rule. In the earlier cases, the courts gave more weight to the language of the clause designating the sum as a penalty or liquidated damages. The modern authorities attach greater importance to the meaning and intention of the parties. Yet the intention is not all controlling, for in some cases the subject-matter and surroundings of the contract will control the intention, where equity absolutely demands it.”
An examination of the cases in this state since Streeper v. Williams, decided thirty years ago, only confirms the correctness of the statement, made by Justice Agnew, that each case is determined by its own facts; no definite rule to determine
In Moore v. Colt, 127 Pa. 289, the contract was the sale of a stage line, with a stipulation that the vendor should not engage in the business. The words were: “ And each party is hereby held and fully bound in the sum of $300 for the faithful fulfilment of the above contract.” This was held a penalty, the court saying, the defendant has no equity that language which technically provides a penalty shall be treated as liquidated damages. That, where the parties call it a penalty, it will be so construed, unless equity demands otherwise.
In March v. Allabaugh, 103 Pa. 335, Justice Clark says, in delivering the opinion of the court, we must consider the relation which the sum stipulated bears to the extent of the injury which may be caused by the several breaches provided against, and the ease or difficulty of measuring a breach in damages.
In Keck v. Beiber, 148 Pa. 645, Justice Mitchell, after approving. the language of Justice Agnew in Streeper v. Williams, says, the presumption is that a lump sum named by the parties to a contract is a penalty rather than liquidated damages ; the name by which it is called is of slight weight, the controlling elements being the intent of the parties and the special circumstances of the case. Where there are numerous covenants of the most varied kinds and importance, and yet the sum named is payable for a breach of any, even the least, it is a penalty.
The sum of the authorities in our own state is, that the intent of the parties in most cases, but not in all, will determine whether the sum stipulated is a penalty or liquidated damages, Calling it a penalty is some evidence that it was so intended, but this is overcome, if equity demands it shall be treated as liquidated damages. And that, in determining the equities of the particular case, the relation which the sum bears to the extent of the injury .provided against, will be considered. That where there are a number of covenants, and the sum named would be payable for a breach of any one of them, even the least, it is a penalty.
Take now the circumstances under which this agreement was
There is nothing in the nature of the contract or the circumstances attending it which points to an intent of the parties to treat this sum other than what they call it, a penalty.
While there is much variance in the authorities on this question, the equities of the particular case often determining the
As to the second proposition held by the learned judge, that plaintiff has an adequate remedy at law, his decision is grounded mainly on the interpretation that the contract stipulates for liquidated damages. As we do not concur with him in this view, the question remains, whether, treating it as a penalty, in equity the plaintiff is entitled to a specific performance of the contract. That plaintiff could maintain an action at law for damages, for breach of the contract, there is no doubt. But it is a well settled rule, that although the action at law will lie, yet if there is an utter uncertainty in any calculation of damages from the breach of the covenants, and the measure of damages is largely conjectural^ equity will intervene because of the inadequacy of the remedy. The plaintiff claimed damages to the amount~bf~!one hundred dollars per month, up to the hearing of the case before the master, and offered evidence to establish this claim. But there was no full hearing on the merits of this branch of the case, nor any finding of fact by the master, and we pass no opinion on this evidence. It remains open, for further proceedings in the court below, to determine the amount of damages sustained by plaintiff, between the return of defendant to Lehman Centre and the issuing of this injunction. We only determine that from the very nature of this contract an action at law is a wholly inadequate remedy for its
Therefore the decree-of the court below dismissing the bill is reversed at costs of appellee, and the bill reinstated; it is further ordered that an injunction issue directed to defendant, restraining him from practicing as a physician at Lehman Centre, and with'in eight miles thereof, until the 6th day of February, 1898, and from manufacturing or putting on sale any medical preparation during the same time.