Oak Cliff Ice Delivery Co. v. Peterson

VAUGHAN, J.

Oak Cliff Ice Delivery Company, a private corporation, appellant, instituted this suit against F. C. Peterson, appellee, on March 25, 1927, to enjoin appel-lee from delivering ice and attempting to establish an ice route in violation of his written contract in that portion of the city of Dallas, Tex., west of the Trinity river known as Oak Cliff. A temporary order was granted the date the petition was filed, restraining appellee from violating his contract in the respects alleged. The order required the ap-pellee to appear and. show cause why the restraining order should not he made permanent. On April 16, 1927, á hearing was had under said notice, at which appellee presented his motion to dissolve the restraining order and exceptions to appellant’s petition on the ground that the contract declared on was not assignable in that appellant’s petition showed that the contract was entered into between one J. B. Williams as employer and appellee as driver, and appellant sought to avail itself of the benefits of the contract as the assignee of the said J. B. Williams; the ground of the exception so presented being that the contract was a personal contract with J. B. Williams and not with appellant, and the same was not assignable. Appellee’s special exceptions Nos. 1 and 9, each being in effect a general demurrer, were sustained, the restraining order theretofore issued dissolved, and the injunction prayed for denied. It is only necessary, for a proper disposition of this appeal, to have recourse to the following provisions o,f the contract furnishing the basis for this suit:

“Agreement, entered into this the 21st day of December, A. D. 1923, between J. B. Williams or his assigns hereinafter designated ‘Employer’ and E. O. Peterson- hereinafter designated ‘Driver.’

“The employer employs the driver for the purpose of driving an ice wagon to serve customers assigned to him; to canvass for new customers ; to instruct other drivers and employees as foreman when detailed so to do; and to perform such other duties as may from time •to time be delegated to him by the employer; and the employer agrees to pay the driver a salary not less than fourteen ($14.00) dollars per week.

“Said driver binds himself to at all times, observe all rules and regulations of said employer, and to give Ms entire time and best attention to its business.

“It is agreed that each party hereto may terminate this agreement upon fifteen days’ notice, written only acceptable, but said employer may discharge said driver at any time for

“(a) Violation of its rules, or

'“(b) Insubordination, or

“(c) Incivility to patrons, or

“(d) Failing to account for and pay over moneys as collected for the account of the employer, or

“(e) Inattention to its business, or

“(f) Unsatisfactory results from his route (employer to be the judge of that), or

“(g) Improper care and handling of his outfit.

“This agreement shall be in force as often as the driver shall be in the employ of the employer, whéther his employment -be continuous or not.

“In consideration of the premises the driver .agrees not to engage in ice business, within the territory covered by the route or routes of which he may have had charge while in the employ of the employer, or within five squares, or blocks therefrom, for a term of three (3) years immediately after his employment shall, for any cause, cease, either on his own account or as agent or employee of any person, persons, corporation or corporations, by canvassing for and soliciting trade; by selling or delivering ice by establishing or endeavoring or pretending to establish an ice route; by selling, transferring or giving to anyone any right he may claim to have acquired in any ice route; nor by assisting anyone in doing any of the foregoing things or acts; nor in any manner whatsoever said driver agrees not to furnish anyone information as to said route or names of customers.”

Appellant alleged the execution of the contract by one J. B. Williams, as employer, and appellee, as driver, the assignment of said contract to appellant by said Williams, the compliance by appellant with its terms, and the violation thereof by appellee in soliciting the customers of appellant served by appellee while in its employ; that he was, either for himself or some other person, persons, or corporation, canvassing for and soliciting trade in violation of said agreement and selling and delivering ice for himself or as the agent or employee of some other person in the territory prohibited to him by the terms of said contract. Replying by way of supplemental petition to appellee’s answer, alleging that said contract was not assignable on account of being a personal contract with J. B. Williams and not with appellant, appellant alleged that said Williams, at the time of the execution of the contract, was engaged in the business of delivering ice in Oak Cliff, but that one J. 0. Jones and one Joe C. Thompson owned all his physical equipment find furnished the finances for said business, and that appellee knew this fact; that shortly after the execution of said contract said Williams left and surrendered the business, including the contract, to J. O. Jones and Joe C. Thompson, who formed the appellant corporation about March, 1924, and that appellee, with knowledge of such circumstances, continued in the employ of these successors in the business until he ceased to work in March, 1927. The only question involved on this appeal is whether or not the contract sued upon was assignable.

Appellant contends that from a consideration of the entire contract it appears that only a certain result was contracted for, between appellee and said Williams, viz., to hold ice customers served by appellee for his business and not for the personal labor or services of appellee. In other words, that in so far as appellee was required by the terms of the contract to perform personal service, same was but incident to the result sought to be accomplished, viz., to hold the customers for his business served by appellee; that being the paramount purpose for which the contract was executed. Appellant cites the following authorities in support of the foregoing proposition: Langever v. United Advertising Corporation (Tex. Civ. App.) 258 S. W. 856; Dannel v. Sherman Transfer Co. (Tex. Civ. App.) 211 S. W. 297; Jennings v. Shepherd Laundries Co. (Tex. Civ. App.) 276 S. W. 726; Dittman v. Model Baking Co. (Tex. Com. App.) 271 S. W. 75; Malakoff Gin Co. v. Riddlesperger, 108 Tex. 273, 192 S. W. 530; Lakeview Land Co. v. San Antonio Traction Co., 95 Tex. 252, 66 S. W. 766; M. K. & T. v. Carter, 95 Tex. 461, 68 S. W. 159; McKneely v. Armstrong, 109 Tex. 363, 210 S. W. 192; Coleman v. Anderson, 98 Tex. 577, 86 S. W. 730; Sickles v. Lauman, 185 Iowa, 37, 169 N. W. 670, 4 A. L. R. 1073. Each of these authorities is distinguished from the instant ease by the lack of that vital feature of personal trust and confidence that apparently existed between and actuated the parties in the making of the contract under consideration, viz., appellee was willing to vest in said Williams the power and authority to discharge him at any time, and in this .respect clothed him with autocratic power for (a) violation of his rules, or (b) insubordination, or (c) incivility to patrons, or (d) failure to account for and pay over moneys as collected for the account of the employer, or (e) inattention to his business, or (f) unsatisfactory results from his route, or (g) improper care and handling of his outfit; and conferred upon him the authority to terminate said agreement upon 15 days’ notice in writing, this being, it is true, a reciprocal right. By the literal terms of the contract, appellee was employed for the purpose of serving said Williams as follows : To drive an ice wagon, to serve customers assigned to him, to canvass for new customers, to instruct other drivers and employees as foreman when detailed so to do, and to perform such other duties from time to time as should be delegated to him by said Williams. The agreement on the part of ap-pellee not to engage in the ice business within the territory covered by the route or routes of which he may have had charge while in the employ of said Williams, or within five squares or blocks therefrom, for a term of three years immediately after his employment should from any cause cease, embodied an agreement of inactivity on his part in the territory designated and for the time stated in so far as engaging in the ice business, while the dominant feature of the contract is one of employment requiring the actual performance of personal service, as above specifically designated, and the performance of other duties left with the said Williams to' be directed to be performed in connection with the conduct of his ice business. That this contract involved unlimited personal confidence is self-evident. The plenary authority conferred by appellee upon said Williams to discharge him manifested the intention of the parties that their contract should not be assignable, in that in making the contract appellee selected Williams as the one to whom he was willing to commit such power, to terminate the contract in so far as appellee was concerned, and to direct his services thereunder. This is in keeping with the doctrine announced in Arkansas Valley Smelting Co. v. Belden Mining Co., 127 U. S. 379, 8 S. Ct. 1308, 32 L. Ed. 246, as follows:

“But everyone has a right to select and determine with whom he will contract, and cannot have another person thrust upon him without his consent. In the familiar phrase of Lord Denman, ‘You have the right to the benefit you anticipate from the character, credit and substance of the party with whom you contract.’ * * * The rule upon this subject, as applicable to the case at bar, is well expressed in a recent English treatise. ‘Rights arising out of contracts cannot be transferred if they are coupled with liabilities, or if they involve a relation of personal confidence such that the party whose agreement conferred those rights must have intended them to be exercised only by him in whom he actually confided.’ Pollock on Contracts, 4th Ed. 425. * * * In short, the plaintiff undertakes to step into the shoes of Billing, and to substitute its liability for his. The defendant had a perfect right to decline to assent to this, and to refuse to recognize a party, with whom it had never contracted.”

To the same effect is the holding in the following cases: Hudson v. Farris, 30 Tex. 574; Menger v. Ward, 87 Tex. 622, 30 S. W. 853; Thomas-Bonner Co. v. Hooven et al. (C. C. A.) 284 F. 386; Schlessinger v. Forest Products Co., 78 N. J. Law, 637, 76 A. 1024, 30 L. R. A. (N. S.) 347, 138 Am. St. Rep. 627; American S. & R. Co. v. Bunker Hill & S. M. & C. Co. (D. C.) 248 F. 172; Globe & Rutgers Fire Ins. Co. v. Jones, 129 Mich. 664, 89 N. W. 580; Randall v. Chubb, 46 Mich. 311, 9 N. W. 429, 41 Am. Rep. 165.

We conclude that the contract was not only personal in so far as the character of services to be performed and the condition under which same were to be performed, but in addition thereto that in making the contract, conferring upon Williams the right to exercise the discharging power in a practically unlimited way, was the imposing of confidence and trust in him which would indicate the deliberate selection of Williams for that purpose by appellee, and the relatonship thus created was one that was not intended by the parties to be assignable. To hold otherwise would be to destroy the right of one to select for himself the party to whom in contracting on account of his knowledge of and confidence in, he is willing to commit, without the usual safeguards, the exercise of certain .rights and privileges vital to the subject-matter of the contract, and which might be used by a designing or unreliable person to his disadvantage or injury.

It is clear from the terms of the contract that appellee placed himself almost without reservation in the power of Williams to terminate the contract which would end his employment and for three years deprive Mm of Ms right to resume the ice business in the territory prohibited to him by the terms of the contract. Certainly it was not within the contemplation of the parties that the relationship thus brought about should be by assignment conferred upon and exercised by a stranger to appellee without his consent thereto. Appellant attaches considerable importance to the use of the word “assigns” in connection with the name of J. B. Williams, as follows:. “Between J. B. Williams and his assigns hereinafter designated employer,” and contends that the use of that word indicated that it was the intention of the parties that the contract should be assignable, that is, pass to the assigns of J. B. Williams. As used, this word does not describe the parties who might enforce the contract, or control the body of the contract in the matter of assignment. The word as used is not significant of the intention of the parties, or as to the construction of the contract — not even descriptive of the person who might take an interest in or incur a liability under the contract. Therefore, the contract was not made assignable by the use of the term “assigns,” as same involved a relation of personal confidence which repelled the idea that it was intended by the parties that any person other than the one named in the contract on whom the right to exercise such provisions was conferred should exercise same. Swarts v. Narragansett Elec. Light Co., 26 R. I. 436, 59 A. 111; Adair v. Smith, 23 6a. App. 290, 98 S. E. 227; Central Brass & Stamping Co. v. Stuber (C. C. A.) 220 F. 909.

Appellant, in support of his contention that the court erred in sustaining the exceptions, relies upon the above-mentioned allegations contained in its supplemental petition, presenting in effect estoppel and ratification on the part of appellee as to and of the assignment of said contract as pleaded by appellant. Admitting all of the allegations so relied upon, viz., the transfer of the business by J. B. Williams to Joe O. Thompson and J. 0. Jones, the organization of the appellant corporation by Thompson and Jones, that appellee thereafter was employed by and worked for appellant, and that appellee knew of the transition of the business from the proprietorship of J. B. Williams to that of appellant and all the circumstances attending such change as pleaded by appellant, same did not constitute an estoppel as to or ratification of the attempted assignment of the contract involved, no act being alleged on the part of appellee by which appellant was induced to accept the’ transfer and assignment of the contract or that showed such acquiescence in the rights asserted by appellant under the assignment as claimed by him as- would preclude appellee from urging as a defense to the relief sought by appellant that said contract was not assignable. Finding no error in the judgment of the trial court, same is affirmed.

Affirmed.