On appeal from the Supreme Court.
For the appellant, Wolber & Gilhooly (John H. Yauch, Jr.).
For the respondents, Joseph H. Carr.
The opinion of the court was delivered by
BODINE, J. A number of Camden county laundries entered into a price-fixing agreement providing for a minimum price to be charged. They also agreed that if they accepted washing from persons who solicited the same, they would require those persons to charge their customers the minimum rate. The agreement contained a covenant that after June 11th, 1928, the signatories would not transact business with solicitors of laundry work unless they had already had business dealings with them. The solicitors of laundry work are called in the contract by the euphonious term "bob-tails." The contract provided for liquidated damages in the event of breach, and to secure the payment thereof a non-negotiable demand note for $1,000 was given to the plaintiff Buckalew, as trustee, by each of the parties entering into the agreement.
The plaintiff brought suit on such a note and the defendants admitted the making of the same, as well as the pricefixing agreement, and the breach thereof by reason of prohibited
transactions with the so-called "bob-tails." The defense was that the contract was illegal as against public policy.
The defendants called a number of witnesses, who gave testimony indicative that the laundry business in Camden and its immediate vicinity had not been profitable and the laundrymen had formed an association in order to maintain prices, and that the contract in suit was the plan devised to remedy their troubles and secure a profit.
Plaintiff's counsel, at the close of defendants' case, moved for a direction of a verdict on the ground that the proofs did not show that the price-fixing contract was unreasonable. The trial court denied this motion, and said that there was a fact question as to whether there was a combination to fix prices and control competition to the detriment of the public. The concluding portion of his charge was as follows: "You will see, therefore, the question is whether this agreement, in its effect, tended to put in the hands of the signatories, the power to practically control prices and the trade, to the detriment of the public. If it did, it is illegal. If it did not, it is legal. If it was illegal, your verdict will be for the defendants. If it is legal, your verdict will be for the plaintiff in the sum of $1,000 dollars." As we view the case, there was no harmful error in this.
In Wyder v. Milhomme, 96 N.J.L. 500, it was held by this court in an opinion by Mr. Justice Parker, that a covenant not to engage in the silk business in the United States for ten years was unenforceable as against public policy, and that the unreasonable character of the covenant was a court question.
The proofs show that the laundries, whose owners were parties to the price-fixing agreement, controlled about eighty-two per cent. of the business in the vicinity of Camden.
The sole ground of appeal is that the trial judge should have directed a verdict in favor of the plaintiff. The ground on which the ruling was requested was that the proofs failed to show ...