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SECOND DEPARTMENT, MARCH TERM, 1899.

App. Div.]

the life tenant that the market value of the bonds did not go higher. If it had gone high enough he would have had no income at all.

Though we agree with the learned referee in holding that the plaintiff should make good to the corpus of the trust the depletion for which it is responsible, by paying over the whole amount of the coupons collected to the life tenant, we think that the life tenant should not have the benefit of the restoration. He insisted, both before and since the commencement of the action, that he was entitled to the whole amount of the coupons. If he should receive the interest on the sum restored to the estate, he will have been paid twice. He should be estopped from asserting that the action of the trustee in the payments made to him was illegal. It is true that the life tenant of a trust fund cannot anticipate or assign his income, nor can he create any lien thereon. We have held in the case of Spencer v. Spencer (ante, p. 403), that a trustee, who for a long term of years paid to the life tenant the whole income, without deducting any commissions, could not make the commissions he had failed to retain, a charge on future income. But at the same time we said that we did not hold that no error of overpayment in the trustee's accounts could be corrected in his future dealings with the cestui que trust. In the present case, until the recent decisions in the Appellate Division of the first department, there was no authoritative determination by the courts on the question of income involved in this case. During the period of the plaintiff's trusteeship we think, probably, the weight of authority was in favor of the plaintiff's view as to the rights of the life tenant; at least the authorities were equally balanced. It, therefore, had some justification for its conduct, and it does not lie in the mouth of the life tenant to assert that its conduct was illegal. The judgment below should be modified by providing that, during the life of the defendant William J. Baker, the income on the amount of the capital charged to the plaintiff may be retained by it, and, as modified, affirmed.

The costs and allowances to counsel in this case exceed in the aggregate the sum of $6,400. This sum, which equals or exceeds the amount in controversy, is, in our opinion, grossly extravagant. No appeal, however, as to those allowances has been taken by any of the parties, and we are without power to act. We do, however, APP. DIV.-VOL. XXXVIII.

54

SECOND DEPARTMENT, MARCH TERM, 1899.

[Vol. 38. indulge in the hope that the trustee will in the future make no errors in its accounts, for, if they are to be corrected by litigation as expensive as the present, the trust fund will be depleted more rapidly than by any charge for premium on bonds. All we can do is to direct that the modification and affirmance by this division of the court shall be without costs to any of the parties.*

All concurred.

Judgment modified in accordance with opinion, and, as modified, affirmed, without costs to either party as against the other.

FRANK K. MURPHY and Others, Doing Business under the Copartnership Name of JOHN MURPHY & Co., Respondents, v. CHRISTIAN PRESS ASSOCIATION PUBLISHING COMPANY, Appellant. Contract authorizing the printing from the vendor's plates of books to be sold at a -the specified price-sale of plates to another party by a receiver of the vendor. purchaser restrained from selling a better edition at a less price-contract in restraint of trade — monopoly.

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A corporation owning the copyright of a prayer book sold a set of plates (for printing in one color only), and authorized the vendees, subject to certain restrictions, to publish the work from that set of plates, covenanting that it would not sell a set of plates to any other publisher without the consent of the vendees; the agreement contained a provision that the retail price for plainly bound copies should be one dollar and twenty-five cents, and fixed the discounts to be allowed to the trade. Subsequently a receiver of the corporation sold the remaining sets of plates and the copyright of the prayer book to a company having full notice of such agreement, and the latter proceeded to publish from plates printing in two colors a finer book than that published by the former vendees, and to sell the same at a price much less than that fixed in the agreement between the vendor and the first vendees.

The method of the referee involves a slight error. The reservation of a uniform amount at each payment of the coupons is too great in the early years of the investment aud too small in the later years. But if we assume that these reservations can be invested so as to produce the same interest as the original security, no injury to the life tenant would result from this method. The tabies are claimed to be, and we suppose are, entirely accurate and involve no assumption of an interest rate. But in some respects they are inconvenient, for a new calculation must be made at the time of each interest payment. The rate of interest the investment pays remains constant, but the amount of the investment on which the interest is to be calculated diminishes by the amount of each reservation.

SECOND DEPARTMENT, MARCH TERM, 1899.

App. Div.]

Held, that the agreement made by the vendor, though technically a personal one, imposed an obligation upon all who acquired the plates with notice of such agreement, and that the first vendees were entitled to an injunction restraining the second vendee from selling its publications at less than the stipulated price; That while the agreement only fixed in terms the prices at which "plainly bound copies" might be sold, it was not contemplated that the parties should be at liberty to sell handsomer editions of the publication for a less price than that stipulated for the "plainly bound copies;"

That the principle upon which contracts in restraint of trade are declared void had no application to an agreement fixing the price of copies of the volumes of a single copyrighted book.

Semble, that if all the publishers of copyrighted books upon a certain subject were to combine and agree not to sell any publication on that subject except for a stipulated price, the contract would be in restraint of trade and void.

APPEAL by the defendant, the Christian Press Association Publishing Company, from a judgment of the Supreme Court in favor of the plaintiffs, entered in the office of the clerk of the county of New York on the 10th day of August, 1898, upon the decision of the court rendered after a trial at the New York Special Term, with notice of an intention to bring up for review upon such appeal an interlocutory judgment entered in said clerk's office on the 18th day of May, 1897, upon the decision of the court rendered after a trial at the New York Special Term overruling the defendant's demurrer to the plaintiffs' complaint.

This appeal was transferred from the first department to the second department.

Joseph H. Fargis, for the appellant.

W. W. Thompson, for the respondents.

CULLEN, J.:

This action was brought by the plaintiffs, who constitute the firm of John Murphy & Co., to restrain the defendant from selling a prayer book published by it, and known as "A Manual of Prayers for the Use of the Catholic Laity," at lower prices than those prescribed in an agreement between the plaintiffs and the Catholic Publication Society Company. In 1889 that company owned the copyright of the book. This is charged in the complaint and admitted in the answer, and we can take no notice of the communication of counsel for the appellant, in which he asserts that the company did not acquire the copyright until a subsequent time. For the publication of the work the company had procured four

SECOND DEPARTMENT, MARCH TERM, 1899. [Vol. 38. sets of electrotype plates one of these for printing the whole text in black, a second for printing the text partly in black and partly in red, and two others which were duplicates of those described. In June, 1889, the Catholic Company entered into a written agreement with the plaintiffs by which it sold them one set of plates (for printing in single color only),,and authorized the plaintiffs, subject to certain restrictions, to publish the work from that set of plates. The Catholic Society covenanted that it would not sell a set of plates to any other publisher without the consent of the plaintiffs.. The agreement contained this further provision: "It is further agreed that the retail price for plainly-bound copies shall be one dollar and twenty-five cents, and a royalty of six cents for each and every copy sold shall be paid to the ordinary of the diocese in which the book is printed and published. It is further agreed that the greatest discount allowed to the trade shall not exceed forty per cent, and the greatest discount allowed to the clergy and religious shall not exceed twenty-five per cent, except when the trade purchases five hundred dollars' worth at any one time, then an extra ten per cent may be allowed, and except when the trade purchases one thousand dollars' worth at any one time; then fifty per cent discount may be allowed." The plaintiffs paid for the plates, and both parties proceeded with the publication of the book. In 1895 the Catholic Society was dissolved and a receiver of its property appointed. The receiver sold the plates and copyright to the appellant. At the time of the purchase the appellant had full notice of the agreement with the plaintiffs, a copy of the agreement having been delivered to it. Since its purchase the appellant has published the prayer book and has sold it at a price much less than that prescribed by the agreement between the plaintiffs and the Catholic Society. The edition published by the appellant is in parti-colored print, commonly called "rubricated." The text presents a more beautiful appearance to the eye, and it is a rather finer book than that published by the plaintiffs. The Special Term enjoined the appellant from selling its publications at less than the stipulated price, and directed a reference to assess the plaintiffs' damages. From that judgment this appeal is taken.

We think this action can be maintained against the appellant, and that it is bound by the agreement of the Catholic Publication

SECOND DEPARTMENT, MARCH TERM, 1899.

App. Div.]

Society Company from which it acquired the copyright and electrotype plates. The agreement on the part of the defendant's predecesor in title, though technically a personal one, related to the use of its property, the copyrights and the plates, and obligated all who might acquire that property with notice of the agreement. This is the settled doctrine of the Court of Appeals where the agreement relates to real estate. (Hodge v. Sloan, 107 N. Y. 244; Lewis v. Gollner, 129 id. 227.) We can see no reason why the same rule should not apply in the case of personal property, nor are we wanting in authority to sustain the proposition. (New York Bank Note Co. v. Hamilton Bank Note Co., 83 Hun, 593; 28 App. Div. 411; Littlefield v. Perry, 88 U. S. 205.) In Drone on Copyright (p. 374) it is said: "It may be regarded as settled that a Court of Chancery will restrain an author, or any person having notice, from violating an express negative convenant made by the author." This is equally applicable to the covenant of any person who has acquired title to the copyright in any manner. While the plaintiffs under their agreement with the Catholic Society acquired no legal title to any part of the copyright, in equity they acquired an interest very similar to a negative easement in real estate, which easement incumbered the property in the hands of any party who might have notice. A copyright is very much of the same character as a patent. Under a license a patentee acquires no title to the patent, but he may in the name of his licensor prosecute infringers on his rights, or compel the licensor to specifically perform the terms of his agreement.

The most serious question arises on the construction of the written agreement. The agreement refers in terms solely to the prices at which "plainly-bound copies" may be sold. The appellant contends that its publications are not plainly-bound copies, and do not fall within the terms of the agreement. The agreement, however, must be construed reasonably, and some effect given to it. Certainly it never contemplated that while the parties were restrained from selling plainly-bound copies at less than a prescribed price, they should be at liberty to sell handsomer editions of the publication for a less price than that stipulated for the plainly-bound copies. The evidence shows that "plainly-bound copies" is not a technical term of the trade. We think that in this agreement the words must be

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