Owen v. Willis , 20 S.W.2d 338 ( 1929 )

HALL, C. J.

The appellee, Willis, instituted this suit against Mrs. Jonnie Owen, her husband, Clyde E. Owen, her brother-in-law, Bill Owen, and the Southwestern Bell Telephone Company, to restrain the defendants from breaching a contract dated June 3, 1929, by the terms of which Clyde E. Owen sold his undertaking business hi the city of Chjldress to plaintiff Willis and 'agreed not to enter in the undertaking business during the following ten years. The telephone company was made a defendant because the right to use a certain telephone number was an issue. A temporary restraining order was issued on July 9, 1929, and served upon all of the defendants except Clyde E. Owen, who, it seems, is’ residing in Oklahoma.

Mrs. Jonnie Owen and Bill Owen filed their amended answer and motion to dissolve the temporary injunction. The matter was presented to the trial court on the pleadings alone, and resulted in a judgment overruling the motion to dissolve, except as to the right to use the telephone number and to withhold the list of customers as shown by the books of the business. Mrs. Owen, Bill Owen, and the plaintiff have appealed from this order.

The appellee in his petition for injunction alleges, in substance: That on June 3, 1929, Clyde Owen and wife, Mrs. Jonnie Owen, were engaged in the undertaking business in Childress, under the firm name of Clyde E. Owen Undertaking Company, and that their telephone number was 600. That on said date Clyde Owen, for value, sold and transferred said business to the plaintiff, together with aE equipment, material, supplies, tools, fixtures of every character, and the good wiU of said business, and further agreed not to engage in such business in said county for a period of ten years and not to be employed, directly or indirectly, by any person so engaged during said period. That soon after such transfer Clyde Owen and his wife secured a building about one block from where the plaintiff had located his business, for the purpose of conducting an undertaking business in competition with plaintiff, equipping said. building with the funds paid them by plaintiff. That they have advertised that it is conducted under the name of the defendant BE1 Owen, who is Clyde Owen’s brother, and that Mrs. Owen is to act as the lady assistant in said new establishment. That Clyde Owen and wife and children have moved into and are occupying said building. That the claim that said business is owned -by Bill Owen is only a subterfuge, fraudulent, and untrue. That Clyde Owen and wife are the real and true owners of said business, and that Clyde Owen himself purchased the funeral coach used by said business, and the same was purchased with money received by him from plaintiff in payment for the business now being conducted by plaintiff. That the mortgage given to secure the purchase price of said funeral coach Was executed by Mrs. Owen only as a subterfuge, and is an attempt to show that her husband, Clyde Owen, had nothing to do with it, and was so executed to evade liabEity for violation of the good wül contract made with plaintiff. That Bill Owen had no property or means with which to engage in such business and knew, when he came to Childress to take charge of such business, that all of the acts of said parties were in pursuance of a plan or scheme to evade liabEity for violation of said good will contract.

The amended answer of the defendants Bill Owen and Mrs. Jonnie Owen specifically denies each of the allegations of said petition which tends to show any fraudulent conspiracy, scheme, or understanding to evade the terms of said contract, and denies that said Clyde E. Owen is in any way interested, concerned in, or connected with said funeral 'home opened and being conducted under the name of Bill Owen. It further denies that said funeral home is operated under the name of Bill Owen as a subterfuge or that Clyde Owen and wife are the real and true owners of the business. It is denied that the funeral coach was purchased by Clyde Owen, or that he is participating in the management or control of said business or has profited by or will profit in any way from it. It is further alleged: That Mrs. Owen was opposed to the sale of said business to plaintiff, and that, in order to satisfy her, Clyde Owen agreed to give her half of the proceeds of the sale as her own separate property, and that Clyde Owen, in consideration of her agreement to assume full responsibility for the support and maintenance of their minor children, agreed to pay all community debts from his own share of the proceeds of such sale. That Mrs. Owen accepted $4,500, being one-half of the sum received for said business, as her separate property, and that she and the said Clyde Owen are now separated and are not Eving together as husband and wife. That Mrs. Owen purchased the coach out of her separate estate. That Mrs. Owen originally intended to establish an undertaking business with Bill Owen as a partner, each to invest an equal amount of money. That Bill Owen was unable to pay his share of the capital into the business, whereupon Mrs. Owen agreed to convey the funeral coach and all other property purchased by her for said business to Bill Owen and to lend him sufficient money from her separate funds to operate such undertaking establishment. That, in payment for the coach and other equipment, Bill Owen executed and delivered to her his note in the sum of $3,600, dated June 16, 1929, and due twelve months after date. That said business is now owned and conducted by BiE Owen in the city of Childress, in .premises leased by him and in his own name. That none of the property so used was either purchased or is now owned by Clyde Owen, but that Bill Owen is the sole and only owner of the same, he having purchased it from Mrs. Owen prior to the issuance of the writ of injunction.

The bill of sale executed by Clyde E. Owen to appellee contains this recital: “I do further bargain, sell and convey to the said Everett H.'Willis, aE of the good will pertaining to said business and further bind and obligate myself not to engage in said business in said City of Childress or in Childress County, for the term of ten years next ensuing after this date or in any kind of business or any matter relating to funeral directing, embalming, and undertaking whatsoever, either directly or indirectly, or be employed by any person, firm or corporation in said City or County, engaged in funeral directing, embalming and undertaking, within ten years next succeeding this date.”

Bill. Owen was not a party to the contract under which Willis acquired the business, nor did Mrs. Jonnie Owen join her husband in said contract or in the transfer of the business.

The gist of the action, as shown by the petition for injunction, is that, through a fraudulent agreement pud conspiracy entered into by the defendants, the business really belongs to Clyde Owen, but is being conducted in the name of Bill Owen, assisted by Mrs. Jonnie Owen. Unless these facts are true, clearly the appellee was not entitled to either a temporary or permanent injunction. These allegations are specifically denied by the answer filed by Bill Owen and Mrs. Jonnie Owen.

Rev. St. 1925, art. 4663, provides that the principles, practice, and procedure governing courts of equity shall govern proceedings in injunctions when the same are not in conflict with other provisions of the statute. Under the general rules of equity procedure relating to injunctions, where an answer denies the allegations of the petition and is verified, in so far as the allegations in the answer are responsive to the facts set up in the bill, they are to be taken as true, and, if a temporary injunction has been granted, it should ordinarily be dissolved. Boykin v. Patterson (Tex. Civ. App.) 214 S. W. 611; Harris v. Thomas (Tex. Civ. App.) 217 S. W. 1068; Houston Elec. Co. v. City of Houston (Tex. Civ. App.) 212 S. W. 198; Webb v. Downing (Tex. Civ. App.) 2 S.W.(2d) 474. While it has been held that this rule is not absolute and that the injunction will not always be dissolved, but that its dissolution depends upon circumstances and is in a measure discretionary with the trial court, this record discloses ho circumstances which, in our opinion, authorized the court to refuse to dissolve the injunction. The rule is well established that a temporary injunction will be denied in a doubtful case where granting of it would cause greater detriment to defendant, should he ultimately prevail, than would be caused to complainant by its refusal, should he ultimately prevail. Collins v. Humble Oil & Refining Co. (Tex. Civ. App.) 223 S. W. 696, and authorities cited. If the defendant Bill Owen is restrained from conducting his business pending a final determination of the suit, the injury resulting to him would be manifestly greater than any damages sustained by Willis, for the reason that the record shows that Bill Owen is conducting his business in rented premises and has employed Mrs. Owen as an assistant and that these expenses will continue during the pendency of the suit On the other hand, it is not shown that Clyde Owen'and his wife are insolvent, and if, upon a final trial, Willis should prevail, he has his right of action for damages resulting to him by violation of the terms of the contract.

We have carefully read the answer, and do not agree with the contention of appellee that the court was justified in overruling the motion to dissolve because of admissions in the answer, and, since no evidence was introduced, we think the injunction should have been dissolved pending a final hearing. If Mrs. Owen was Interested in the business with her husband, Willis could have bound her by the contract. This he failed to do.

It is held that the mere lending of money to a person engaged in a similar business does not amount to a breach of a covenant not to engage in such business, and, even if it were shown that Clyde Owen had advanced the funds for the purchase of the coach or that the money loaned Bill Owen actually belonged to him, still we incline to the opinion that the injunction should not have been granted. It does not appear that Clyde Owen was insolvent at the time he gave his wife one-half of the proceeds of the business. So far as the record shows, he had no creditors, and, even though the $9,000 received from Willis was community property, he could, under such circumstances, give all or any part of such sum to her as her separate estate, and the appellee cannot complain. Cauble v. Beaver-Electra Refining Co., 115 Tex. 1, 274 S. W. 120; Id. (Civ. App.) 243 S. W. 762.

Sipce Mrs. Owen was not a party to the contract between her husband and appel-lee, her employment by her brother-in-law is in no sense a violation of the contract unless the conduct of the business by Bill Owen and her employment as an assistant are shown to be a fraud and a subterfuge. No evidence was introduced sustaining the allegation of fraud, and the answer fully and completely denies that equitable ground of intervention. She therefore had the right to accept personal employment from her brother-in-law, and an injunction should not be granted in the absence of evidence sustaining the allegations in the bill. 13 C. J. 556; 30 C. J. 584; 32 C. J. 223; Houston T. & C. Co. v. Williams (Tex. Com. App.) 221 S. W. 1081.

In our opinion, the verification of the answer is sufficient. However, if it were defectively verified, the appellee has waived the defect by not calling the trial court’s, attention to it. 32 C. J. 422.

The temporary injunction is dissolved, the judgment of (he lower court is reversed, and the cause is remanded.