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Rosenberg v. Kaltman

Decided: November 12, 1953.

PINCUS ROSENBERG, PLAINTIFF,
v.
D. KALTMAN & CO., INC., DEFENDANT



Haneman, J.s.c.

Haneman

The complaint herein seeks a declaratory judgment under N.J.S. 2 A:16-50 to declare the rights, status and legal relations of the plaintiff in connection with two certain contracts entered into between him and the defendant. The plaintiff desires to have particularly adjudicated the effect of two apparently conflicting negative covenants contained in each of said contracts.

The defendant has moved to dismiss the complaint and the plaintiff has moved for a summary judgment.

The question of whether the plaintiff's motion is premature is now academic, since under a stipulation, both motions were to be simultaneously considered by the court.

The facts in connection herewith, as elicited from the respective pleadings and affidavits filed, are as follows:

On or about July 1, 1937 plaintiff became employed by the defendant, which corporation was engaged in the wholesale drug business. On or about December 1, 1950 plaintiff became a sales supervisor for the defendant corporation in a so-called South Jersey division territory, consisting generally of the geographical sections recited in paragraph 9 of said contract. On that date he entered into a contract with the defendant corporation which provided, in part, as follows:

"(9) -- It is further expressly agreed that in the event of the termination of this contract or of the employment herewith for any cause, the Employee shall not, in all the Counties in the State of New Jersey, and the counties of Philadelphia, Bucks, Montgomery, Delaware in the State of Pennsylvania and the county of New Castle in the state of Delaware enter into the Wholesale Drug Business or any branch of the Wholesale Drug Business then conducted by the Employer either as salesman, principal or agent, employer, or employee, officer, director or otherwise, directly or indirectly for a period of one year after the said termination of this contract or of the employment thereunder, or of any extensions, renewals or continuations thereof, as in the next succeeding paragraph hereof provided."

Thereafter, on or about March 1, 1953 the plaintiff ceased to be a sales supervisor for defendant, but was employed by the defendant as a salesman in a less extensive territory than theretofore, and as more particularly set forth in paragraph 9 of said contract, post. On that date the said parties entered into a contract which provided, in part, as follows:

"(9) -- It is further expressly agreed that in the event of the termination of this contract or of the employment herewith for any cause, the Employee shall not, in the Counties of Atlantic, Ocean and Cape May, all in the State of New Jersey, enter into the Wholesale Drug Business or any branch of the Wholesale Drug Business then conducted by the Employer either as a salesman, principal or agent, employer, or employee, officer, director or otherwise, directly or indirectly for period of one year after the said termination of this contract or of the employment thereunder, or of any extensions, renewals or continuations thereof, as in the next succeeding paragraph hereof provided."

Reduced to its simplest statement, the plaintiff now contends that the negative covenant contained in the contract of March 2, 1953 is the sole effective covenant and that the said contract of 1953 supersedes the contract of 1950 in all of its parts.

The defendant, on its motion, first alleges that this is not the type of action upon which relief can be granted under the above-cited statute, and second, takes issue with plaintiff on his construction of said contract.

N.J.S. 2 A:16-50 et seq. is a remedial statute and should be liberally construed. There must be an actual controversy between the parties and the action must be adversary in character. The defendant argues that the plaintiff here has another remedy available and is seeking to "bag in advance an imminent and impending law suit." Weissbard v. Potter Drug and Chemical Corp. , 6 N.J. Super. 451 (Ch. Div. 1949), affirmed 4 N.J. 115 (1950). It alleges, in effect, that if the plaintiff conceives that he is not bound by the negative covenant contained in the first of the above referred ...


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