contract is not as reasonable as when the interest is partial, and there is a corresponding partial restraint. There is no public reason which necessarily condemns the one and not the other.'

The doctrine relating to contracts in restraint of trade has been elaborately discussed in a careful opinion of Andrews, J., in the recent case of Diamond Match Co. v. Roeber, 9 Cent. Rep. 181, 106 N. Y. 473. Under the authority of that case it may be said that no contracts are void as being in general restraint of trade where they operate simply to prevent a party from engaging or competing in the same business. To the extent that the contract prevents the vendor from carrying on the particular trade, it deprives the community of any benefit it might derive from his entering into competition. But the business is open to all others, and there is little danger that the public will suffer harm from lack of persons to engage in a profitable industry. Such contracts do not create monopolies. They confer no special or exclusive privileges.

A contract in restraint of trade, made on good consideration and not extending beyond the obligee's sphere of actual business, is valid.'

A covenant in restraint of trade is valid if it imposes no restriction upon one party which is not beneficial to the other, and was induced by a consideration which made it reasonable for the parties to enter into it, or, in other words, if it was a proper and useful contract, or such as could not be disregarded without injury to a fair contractor.'

This is the doctrine of Chappel v. Brockway, 21 Wend. 157, derived from the leading case of Mitchel v. Reynolds, 1 P.Wms. 181, and an examination of subsequent decisions. It is also amplified and discussed in Diamond Match Co. v. Roeber, 9 Cent. Rep. 181, 106 N. Y. 473.

It is an encouragement to industry and enterprise in building up a trade, that a man may thereafter be permitted to sell the good will of the business and the fruits of his industry upon the best terms he can obtain. If his business extends over a con

'Leslie v. Lorillard, 1 L. R. A. 456, 110 N. Y. 519.

'Palmer v. Stebbins, 3 Pick. 188, 15 Am. Dec. 204; Oregon Steam Nav. Co. v. Winsor, 87 U. S 20 Wall. 64, 22 L. ed. 515.

'Hodge v. Sloan, 9 Cent. Rep. 870, 107 N. Y. 249.

tinent, public policy does not forbid his accompanying the sale with a stipulation for restraint co-extensive with the business which he sells.

Contracts in restraint of trade will be valid, when the restriction is not larger and wider than the protection of the party with whom the contract is made can possibly require.'

It has been said that all the cases when they come to be examined seem to establish this principle: that all restraints upon trade are bad as being in violation of public policy, unless they are natural and not unreasonable for the protection of the parties dealing legally with some subject matter of contract. The principle is that public policy requires that every man should not be at liberty to deprive himself, or the public, of his labor, skill or talent, by any contract that he enters into. On the other hand, public policy recognizes that when a man has by skill, or by any other means, obtained something which he wants to sell, he should be at perfect liberty to sell it to the greatest advantage to himself, and in order to enable him to effect such sale, and secure the full value, it may be, in the particular case, with regard to the subject matter, necessary that he should be able to preclude himself from entering into competition with the purchaser. In such case the same public policy enables him to enter into any stipulation, however restrictive it is, provided the restriction, in the judgment of the court, is not unreasonable, having regard to the subject matter of the contract and trade conditions."

'Guerand v. Dandelet, 32 Md. 561, 570; Booth v. Robinson, 55 Md. 419; Tonawanda Valley & C. R. Co. v. New York, L. E. & W. R. Co. 42 Hun, 496, 499; Leslie v. Lorillard, 1 L. R. A. 456, 110 N. Y. 519, 532–534; Dubuque & 8. C. R. Co. v. Richmond, 86 U. S. 19 Wall. 584, 590, 22 L. ed. 173, 176; Central Shade Roller Co. v. Cushman, 3 New Eng. Rep. 505, 143 Mass. 353, 363; Skrainka v. Scharringhausen, 8 Mo. App. 522: Columbus, P. & I. R. Co. v. Indianapolis & B. R. Co. 5 McLean, 450454; Androscoggin & K. R. Co. v. Androscoggin R. Co. 52 Me. 417, 434; Greenhood, Public Policy, 324, Rule 270.

Leather Cloth Co. v. Lorsont, L. R. 9 Eq. 345; Smith v. Fell, 5 Cent. Rep. 208, 113 Pa. 579; Horner v. Graves, 7 Bing. 743; Stearns v. Barrett, 1 Pick. 443; Ward v. Byrne, 5 Mees. & W. 548; Hitchcock v. Coker, 6 Ad. & El. 438, 454; Whittaker v. Howe, 3 Beav. 383; Mallan v. May, 11 Mees. & W. 653, 667; Jarvis v. Peck, 10 Paige, 118, 4 L. ed. 910; Alcock v. Gilbertson, 5 Duer, 76; Jones v. Lees, 1 Hurist. & N. 189; Mumford v. Gething, 7 C. B. N. S. 305; Harms v. Parsons, 32 L. J. Ch. 247; Keeler v. Taylor, 53 Pa. 467; Smith v. Fell. 5 Cent. Rep. 208, 113 Pa. 579; Oregon Steam Nav. Co. v. Winsor, 87 U. S. 20 Wall, 64, 22 L. ed. 315; Rousillon v. Rousillon, L. R. 14 Ch. Div. 351; Diamond Match Co. v. Roeber, 9 Cent. Rep. 181, 106 N. Y. 473; Newell v. Meyendorff, 9 Mont. 254: Mandeville v. Harman, 5 Cent. Rep. 625, 42 N. J. Eq. 185.

A contract restraining one competent to instruct in the German and French language, for a year after his employment ends, within the limit of a State, is unreasonable, as beyond any apparently necessary protection to his employer, unless it be shown.

otherwise.'

§ 44. Public Policy Concerning Trade Restrictions.-Indeed what public policy requires is often vague and difficult to determine. The recognition of public policy, independently of statutory regulation, as a test of the validity of contracts, is, at best, the establishment of a very uncertain rule,' and the test of public policy is to be applied with the greatest caution.'

Public policy is in its nature so uncertain and fluctuating— varying with the habits and fashions of the day, with the growth of commerce and the usages of trade-that it is difficult to detect its limits with any degree of exactness. It has never been defined by the courts but has been left loose and free from definition in the same manner as fraud. This rule may however be safely laid down that, wherever any contract conflicts with the morals of the time, and contravenes any established interest of society, it is void, as being against public policy. The immediate representatives of the people in Legislature assembled would seem to be the fairest exponent of what public policy requires, as being most familiar with the habits and fashions of the day and with the actual condition of commerce and trade, and their consequent wants and weaknesses. Legislation is least objectionable because it operates prospectively as a guide to future transactions, and does not, like the judgment of a court, annul a contract already concluded.

1Herreshoff v. Boutineau, 8 L. R. A. 469, 17 R. I. 'Richardson v. Mellish, 2 Bing. 229, 252; Davies v. Davies, L. R. 36 Ch. Div. 359, 364; Sadlier v. Biggs, 4 H. L. Cas. 437-439; Hilton v. Eckersley, 6 El. & Bl. 47, 64; Printing & N. Reg. Co. v. Sampson, L. R. 19 Eq. 465; Re Trust Estate of Woods, 52 Md. 520, 536; Vidal v. Girard, 43 U. S. 2 How. 197, 198, 11 L. ed. 204; Richmond v. Dubuque & S. C. R. Co. 26 Iowa, 191, 202; Swann v. Swann, 21 Fed. Rep. 299, 301; Tindal, C. J., in Walsh v. Fussell, 6 Bing. 163; Greenhood, Public Policy, Rule 129, pp. 116, 117, and cases in notes; Oregon Steam Nav. Co. v. Winsor, 87 U. S. 20 Wall. 64, 22 L. ed. 315; Baines v. Geary, L. R. 35 Ch. Div. 156; Hobbs v. McLean, 117 U. S. 569, 576, 29 L. ed. 941, 943; U. S. v Central Pac. R. Co. 118 U. S. 235–240, 30 L. ed. 173-175.

Richardson v. Mellish, 2 Bing. 229.

What is injurious to the rights of citizens should, it would seem, be the subject of positive legislation, rather than the doubtful judgment of a court.'

For this reason courts are reluctant to extend the prohibitions of the common law, except where the public interest imperatively requires it.'

In all cases where the legislative judgment has been expressed, courts are bound by the policy thus declared. Where the statute declares that no one shall vote at a stockholders' meeting upon a power of attorney not executed within the year previous to the meeting, the statute discloses that the policy of the State is opposed to a surrender of the voting power by stockholders, for an indefinite period or for a term of five years, and a voting trust for such a time was therefore held illegal.'

45. Examples of Modern Rule Regarding Restrictions.That the general tendency of recent judicial opinion is to limit the application of the rule that contracts in restraint of trade are void, is shown by the many authorities.*

In Whittaker v. Howe, 3 Beav. 333, a contract made by a solicitor, not to practice as a solicitor in any part of Great Britain, was held valid.

A union formed among dealers in tobacco, the purpose and result of which is to arbitrarily fix the price, and destroy individual discretion, is illegal as an effort to strangle competition outright and breed monopolies.*

'Guillander v. Howell, 35 N. Y. 657; Story, Confl. L. § 566; McNamara v. Gargett, 12 West. Rep. 650, 68 Mich. 454.

'See section 10, chap. 10.

Starbuck v. Mercantile Trust Co. (Conn.) 9 Ry. & Corp. L. J. 203.

4 Whittaker v. Howe, 3 Beav. 383; Jones v. Lees, 1 Hurlst. & N. 189; Rousillon v. Rousillon, L. R.14 Ch. Div. 351; Leather Cloth Co. v. Lorsont, L. R. 9 Eq. 345; Collins v. Locke, L. R. 4 App. Cas. 674; Oregon Steam Nav. Co. v. Winsor, 87 U. S. 20 Wall. 64, 22 L. ed. 315; Morse T. D. & M. Co. v. Morse, 103 Mass. 73; Diamond Match Co. v. Roeber, 9 Cent. Rep. 181, 106 N. Y. 473; Brewer v. Marshall, 19 N. J. Eq. 537; Taylor v. Blanchard, 13 Allen, 370; Vernon v. Hallam, 35 Week. Rep. 156, 56 L. J. Ch. 115; Perkins v. Lyman, 9 Mass. 522; Smith's App. 5 Cent. Rep. 209, 113 Pa. 579; Washburn v. Dosch, 68 Wis. 436; Hanna v. Andrews, 50 Iowa, 462; Live Stock Asso. v. Lery, 3 N. Y. S. R. 514; Smith v. Martin, 80 Ind. 260; Leslie v. Lorillard, 1 L. R. A. 456, 110 N. Y. 519.

'Hoffman v. Brooks, 11 Week. L. Bul. 358.

In Rousillon v. Rousillon a general contract not to engage in the sale of champagne, without limit as to space, was enforced, as being, under the circumstances, a reasonable contract.

In Jones v. Lees, 1 Hurlst. & N. 189, a covenant by the defendant, a licensee under a patent, that he would not, during the license, make or sell any slubbing machines, without the invention of the plaintiff applied to them, was held valid. Bramwell, J., said: “It is objected that the restraint extends to all England, but so does the privilege."

An agreement between a corporation and its stockholders, that the latter should not purchase goods of a certain class, during a limited period, of anyone other than the members of an association with which that corporation had entered into a contract, resulting in benefits to itself and members, is not in restraint of trade.'

The question as to what is a general restraint of trade is not to be determined by the fact that it includes all the territory within state lines; and a restraint is not necessarily general which embraces an entire State. Where such contract is made with the purchaser and his assigns, his successor and assignee may maintain an action upon it; and the fact that the purchaser was a foreign corporation is no objection. And the use of a name may be con

trolled.'

Thus a covenant not to carry on the business of a manufacturer anywhere for a period of five years under a particular name or style is not void.'

An agreement by a particular individual or firm not to manufacture goods in general has been enforced.*

A contract restraining the exercise of a trade within a limited locality, when there is reasonable ground for the restriction, may be valid; and if the restriction seem reasonable, its adequacy as a consideration will not be inquired into."

1Van Marter v. Babcock, 23 Barb. 633; Curtis v. Gokey, 88 N. Y. 304; Live Stock Asso. v. Levy, 3 N. Y. S. R. 514.

'Diamond Match Co. v. Roeber, 9 Cent. Rep. 181, 106 N. Y. 473.

Vernon v. Hallam, 35 Week. Rep. 156, 56 L. J. Ch. 115; but compare Wiley v. Baumgardner, 97 Ind. 66, 49 Am. Rep. 427.

Taylor v. Blanchard, 13 Allen, 370.

McClurg's App. 58 Pa. 51; Leather Cloth Co. v. Lorsont, L. R. 9 Eq. 345. Jenkins v. Temples, 39 Ga. 655; Smith's Appeal, 5 Cent. Rep. 208, 113 Pa.