101 N.J. Eq. 170 | N.J. Ct. of Ch. | 1927
This bill seeks an injunction to prevent the violation by the defendant of a covenant in a bond given in connection with a bill of sale under which he purchased complainant's interest in a business theretofore conducted by the parties as partners. The covenant is as follows:
"* * * That he will not either alone or in partnership with any person whomsoever, either directly or indirectly, nor will he advance capital to other people to carry on business similar to the kind and nature of the business which is now conducted by the said Jacob Yanko, in the Adlem Building, at No. 32 Broad street, Red Bank, N.J., at any time after the 29th day of August, 1925, in the said premises at No. 24 Broad street, or in any other premises, within a radius of two miles from the store of the said Jacob Yanko at No. 32 Broad street, Red Bank, N.J., for a period of fifteen years after the 29th day of August, 1925, and that the intent of this paragraph is that he will not engage in said business either as principal or as employe or in any other capacity, and that he will not solicit the custom either for himself or for any person whomsoever; and that he will forthwith immediately after the date of this bond display a sign with his own name in a prominent place across the street front of the premises known as No. 24 Broad street."
So far as is necessary to this decision, the pertinent facts in this case are recited in the opinion of Vice-Chancellor Church, reported in
A case in which the facts with respect to one phase of the instant case were quite similar to those here, is that ofAmerican Strawboard Co. v. Haldeman Paper Co.,83 Fed. Rep. 619, and there the court said: "The covenant in question is not one in general restraint of trade, and involves no such business as directly concerns the public welfare. The restraint is partial, and not general, and manifestly no larger than necessary for the protection of the owner and lessor against a particular use of the property, for a limited time, in a business which directly competed with the business conducted by it."
The instant case is stronger for the complainant than theStrawboard Case, as here, besides the lease, there is also involved the sale of the business and the termination of a partnership agreement. The covenant is ancillary to the main contract. This case involves both the third and fourth classes of cases in which Judge (now Chief-Justice) Taft, in United States v. Addyston, 85 Fed. Rep. 271, cited in Vice-Chancellor Church's opinion above referred to, said, covenants in partial restraint of trade were generally upheld.
To the authorities cited by Vice-Chancellor Church I desire to add only Palumbo v. Piccioni,
That the enforcement of this covenant against the defendant will entail a hardship on him is no argument against granting relief to the complainant, as "hardships freely and voluntarily assumed as part of a contract sought to be enforced, cannot prevail to stay a specific performance thereof." Bosch MagnetoCo. v. Rushmore,
*173I will alvise a decree in accordance with these conclusions.