Sale, Of business. Good Will. Contract, Construction, In writing, Consideration. Name. Evidence, Admitted without objection, Extrinsic affecting writings. Equity Pleading and Practice, Decree.
A woman, named Marion Smith Lowry, whose father was named Henry A. Smith and who had the right to carry on an insurance business under the names Henry A. Smith and Henry A. Smith Co. as well as under her own name, signed an instrument in writing, which also was signed by a man doing business under the name of H.G. Fairfield Co., as follows: "In consideration of $1,000 cash, (the receipt whereof is hereby acknowledged) and the agreement to pay the sum of $800 additional on December 1st next, we hereby agree to sell and deliver on October 1st next, all our right, title and interest in the insurance business of the late Henry A. Smith, Henry A. Smith Co. and Marion Smith Lowry, to H.G. Fairfield Co. Mrs. Lowry to continue in interest until October 1st, and the remaining 10% to be paid within 2 years from date." Held, that the language of this instrument was not doubtful, that it did not purport to give to the purchaser of the business the right to use the name of the seller or either of the other names which she had the right to use, and that under the provisions of R.L.c. 72, § 5, the purchaser of the business had no right to use in that business any of those names without the consent in writing of the seller or of the personal representatives of Henry A. Smith.
If, in a suit in equity to enforce the alleged provisions of an agreement in writing, of which the language is not doubtful, evidence is admitted without objection of preliminary negotiations of the parties which afterwards were merged in the agreement in writing, the fact that such evidence was admitted without objection gives it no probative effect and it has none.
If a person, who has been carrying on the insurance business in his own name and in the name of his father which he had the right to use, sells the business without agreeing not to engage in the same business again and without selling the use of his name or consenting in writing to the use of the name of his father, although he cannot derogate from the effect of the sale by attempting to deprive the purchaser of any part of the business which he has sold to him, he still can engage in the same business himself, using his own name or that of his father, if he does not solicit business from former customers of himself or of his father.
If a person sells an insurance business for $1,800, of which $1,000 is paid in cash, and the remaining $800 is to be paid on a day named, but makes no agreement not to engage in the insurance business, and, when the second payment is made, signs a receipt in writing, by which "in consideration of" such final payment he "agrees not to engage in the insurance business for a period of five years without the consent of the purchaser," this promise is not binding for lack of a consideration, unless there is a consideration because the further agreement was made by the seller in order to obtain immediately the $800 due to him instead of being obliged to sue for it, which here was not considered.
A final decree in a suit in equity, which makes certain declarations in regard to the rights of the parties and concludes with an order that the bill be dismissed, cannot be complained of by the plaintiff on account of such declarations if he put in issue the matters upon which the declarations as to the rights of the parties are made.
SHELDON, J.
The plaintiff does not deny that upon the findings made at the hearing his bill was rightly dismissed. His contention is that the right to use the names "Henry A. Smith," "Henry A. Smith Co." and "Marion Smith Lowry" in carrying on the insurance business, did pass to him by the agreement between himself and Mrs. Lowry, and that the defendants have no right to use those names in such business; and also that Mrs. Lowry is bound not to compete with him in that business, and not to solicit for herself or any other person the patronage of her former customers or of the former customers of Smith or Smith and Company, and not to interfere in any way with the plaintiff's peaceful enjoyment of the business which he purchased from her.
The written agreement of August 5, 1907, between the plaintiff and Mrs. Lowry did not purport to give to him the right to use the names in question. The effect of this material circumstance is in no wise weakened by the fact that the language of this agreement was chosen by the plaintiff himself. The fact that she allowed him to use those names for a time is sufficiently accounted for by the friendly relations that existed between the parties while she was in his employ, and does not necessarily show an understanding on her part that he had acquired the right to use them. Nor is the language of the instrument doubtful. Such cases as Winchester v. Glazier, 152 Mass. 316, 323, and Insurance Co. v. Dutcher, 95 U.S. 269, 273, have no application here. Under the provisions of R.L.c. 72, § 5, the plaintiff has no right to use in his business either of these names without the written consent respectively of Mrs. Lowry or of Smith's personal representative.
We have not considered the finding that before the execution of the written agreement Mrs. Lowry had told the plaintiff that she would not sell to him the names in question; for it may well be doubted whether it was open to the defendants to prove this fact, as the preliminary negotiations were merged in the written agreement. If so, the fact that the evidence was received without objection would not give to it any probative effect. Butterick Publishing Co. v. Fisher, 203 Mass. 122, 132, 133, and cases cited.
After the sale by Mrs. Lowry to the plaintiff of her interest in the insurance business, she had not the right to derogate from the effect of what she had done by attempting to deprive the plaintiff of any part of the business which she had sold to him. But this did not prevent her from engaging in the same business herself, or from using her own name or that of her father in carrying on such business, although she would not be allowed to solicit business from the former customers of herself and her father. She could not so conduct her own new business as to injure the business which she had sold to the plaintiff. Old Corner Book Store v. Upham, 194 Mass. 101. Foss v. Roby, 195 Mass. 292. Hoxie v. Chaney, 143 Mass. 592.
The plaintiff does not rely upon Mrs. Lowry's promise made in January, 1908, not to engage in the insurance business for five years. He concedes the correctness of her contention that this promise was invalid for lack of consideration. So we need not consider whether under our decisions the obtaining of the actual money due to her instead of being put to suit to enforce her rights would not have been an adequate consideration for a new promise by her. Hastings v. Lovejoy, 140 Mass. 261, 265. Abbott v. Doane, 163 Mass. 433. Parrot v. Mexican Central Railway, ante, 184. Tobin v. Kells, ante, 304.
The recitals of the decree were properly made. Braman v. Foss, 204 Mass. 404, 410. Certainly the plaintiff, having put those matters in issue, cannot complain of the court's passing upon them.
Decree affirmed.