Wells v. First National Exhibitors' Circuit Inc.

George, J. (After stating the foregoing facts.) It seems to be conceded that if the plaintiff was not entitled to an injunction initially, he could not have been injured by the dissolution of the injunction granted, and that the order allowing the defendants to dissolve the injunction by the giving of a bond affords to plaintiff no right of complaint. The position of the defendants in error is that no injunction should have been granted in the first instance, because: (1) The contract upon which the plaintiff in error relies is plain and unambiguous, and does not grant in express terms the right to the exclusive presentation of the pictures in question in the city of Atlanta. (2) The contract itself contains a provision for liquidated damages. (3) The evidence did not authorize a finding that the plaintiff would be damaged, or that his damages were incapable of exact computation. In all events the Criterion Theater Company should not have been enjoined, for the reason that no conspiracy to injure and damage the plaintiff by procuring the Exhibitors’ Circuit to breach its contract with him was proved. 1. We can not agree that the contract is plain and unambiguous. The trial judge evidently regarded the contract as ambiguous, and admitted evidence to explain its meaning. It is true that the contract does not in express terms grant to the plaintiff the right to the exclusive presentation of the pictures in the city of Atlanta; but when the language of the contract, to wit, “first week after release date,” and the designation of the city, “Atlanta population 175,000,” are considered in connection with the fact that no particular theater in Atlanta is named in which the pictures might be exhibited, a very forceful argument favorable to the construction placed upon the contract by the plaintiff in error is [206] presented. It will be observed that the contract contains a blank for the insertion of the theater in which the pictures may be exhibited, but this blank was not filled in by the parties to the contract. In a recent work entitled “The Law of Motion Pictures and the Theater,” by Frohlich and Schwartz, of the New York City bar, is found this language: “The licensee secures the sole right to produce or reproduce the play, and with it the accompanying right to restrain invasions of his license, only when his grant is exclusive. Where no mention is made in the agreement of the exclusiveness of the grant, the court will assume that the grant is not exclusive, and the author may grant the same rights, for the same period, to third parties” (page 6). Again, the same authors (page 73) say: “Unless it is expressly agreed that the license granted shall be a sole and exclusive one, the licensor may grant licenses to produce the same play for the same period and within the same territory to any number of persons.” The following authorities are cited by the authors: Widmer v. Greene, 56 How. Pr. (N. Y.) 91; Barnett v. Q. & C. Co., 226 Fed. 935 (141 C. C. A. 539; Stern v. Laemmle, 133 N. Y. Supp. 1082 (74 Misc. 262); Hart v. Cort, 144 N. Y. Supp. 627 (83 Misc. 44); Willis v. Tibbals, 1 Jones & Spencer (33 N. Y. Super. Ct.), 220. If, as contended by the defendants in error, the meaning is that the licensee or lessee secures the exclusive right to exhibit the pictures, and with it the accompanying right to restrain invasions of the license, only when his grant to such exclusive right is expressed, the decisions cited do not, in our opinion, sustain the text. On the contrary, those decisions recognize the right to show by parol evidence the existence of such a well-known custom that the parties must have contracted with the intention and' the expectation that it would apply to their contract, at least where the contract is equivocal or ambiguous. Hart v. Cort, supra. While a custom which is repugnant to the terms of an express contract will not be permitted to operate against it, evidence of a custom or usage generally and universally recognized in the trade and known to the parties to the contract, and not repugnant to the plain terms of the contract, is admissible to explain it. Moreover, a negative convenant is often necessarily implied in contracts similar in nature to the one under consideration. Montague v. Flockton, 16 L. R. Eq. 189; Hoyt v. Fuller 19 N. Y. Supp. [207] 962; Clark on Equity, § 80. We concede that contracts in restraint of trade are not favored in the law, and are not to be extended in their construction beyond the fair and natural import of the language used; but such contracts, in our view, must be reasonably interpreted, and when the intention of the parties is ascertained it must be effectuated. 13 C. J. 556, and cases cited in notes 87, 88. The Supreme Court of Alabama, in Smith v. Webb, 176 Ala. 596 (58 So. 913, 40 L. R. A. (N. S.) 1191, 1193), a case construing a contract in restraint of trade, said: “Whether the intent of the parties was that the vendee should not engage in the livery business in his own name at that place, or whether he should not contribute by his services, presence, and prestige to the conduct of such a business owned by another, are questions arising from the terms employed in the provisions, and make the true meaning equivocal, and hence present a case calling for the full discovery of the surrounding circumstances existing when the contract was made,” citing Corwin v. Hawkins, 42 App. Div. 571 (59 N. Y. Supp. 603). 2. It is true that the contract contains a provision for liquidated damages in the event of its breach. Such, provision is) however, by no means controlling. “But the taking of a bond in connection with a covenant does not exclude the jurisdiction of equity in a case otherwise cognizable therein, and the fact that the damages in the bond are liquidated does not change the rule. It is a question of intention to be deduced from the whole instrument and the circumstances; and-if it appear that the performance of the convenant was intended, and not merely the payment of damages in case of a breach, the covenant will be enforced.” Diamond Match Co. v. Roeber, 106 N. Y. 473 (13 N. E. 419, 60 Am. R. 464). See also Busk v. Wolf, 143 Ga. 18 (84 S. E. 63); American Ice Co. v. Lynch, 74 N. J. Eq. 298 (70 Atl. 138); High on Injunctions (3d ed.), § 1498. It is only necessary to add that a perusal of the whole contract under consideration shows beyond doubt that the faithful performance of its covenants was intended. 3, 4. The contract in this ease itself provides: “This stipulation for liquidated damages is made because of the difficulty of proving actual damages in the event of any -such default, the actual damages under such contracts as this being speculative and impossible to ascertain.” While this recital in the contract is [208] not conclusive, we think the parties have rightly determined that the damages to plaintiff in error in the event of the breach of the contract would be irreparable. When the nature of the business is considered, this conclusion is irresistible. While the evidence tended to show that the house operated by the plaintiff in error as a moving-picture house was crowded during a certain performance, although the Criterion Company was exhibiting the same picture elsewhere at the same time in' the city of Atlanta, this fact does not conclusively show that no damages whatever would flow to the plaintiff in error from a breach of his contract. Whether his theater would be filled to its capacity on subsequent dates, if the Criterion Company were permitted to exhibit the same picture at the same time (a right which many other moving-picture houses, in the city of Atlanta might likewise claim and exercise if the contention made by the defendants in error is sustained), can not be certainly determined. Even so, the right, for a valuable consideration, to present the pictures in question during the first week after the release date, and exclusively, is a valuable right, and will be protected by a court of equity. The enterprise and reputation of the theater management in such case is an element that can not be left out of view. The evidence in the record authorized the judge to find a conspiracy by the defendants to violate the plaintiff’s contract with the Exhibitors’ Circuit, and in a measure to deprive him of the full benefit of that contract. Some of the evidence upon this issue may have been objectionable, but no exception was taken to it, and it was of some probative value. Where evidence has no probative value, the court can not base a finding of fact thereon. But if it has probative value, the fact that it was improperly admitted, in the absence of any exception to its admission, is of no consequences 5. We therefore reach the conclusion that that part of the order which gave to the defendants the right to dissolve the injunction upon the making of a bond was erroneous. The case presented is not one of the grant of an injunction upon condition. The injunction was unconditionally granted. A means for its dissolution was merely provided. “Where, on the interlocutory hearing of an equitable petition to enjoin a trespass, the judge upon conflictin'? evidence reaches the conclusion that the plaintiff has established a right to an injunction, the same should be granted [209] without qualification when the evidence shows that the damages he may suffer will be incapable of ready computation and ascertainment; for in such a case a bond given by the defendant to answer for any damages which may be had against him can not afford adequate protection to the plaintiff.” Hart v. Lewis, 126 Ga. 439 (55 S. E. 189). “An injunction against irreparable damages necessarily implies that a bond or solvency is not good cause for allowing a trespass to continue.” Woodall v. Cartersville Mining etc. Co., 104 Ga. 156 (30 S. E. 665). These cases are in principle controlling. If the plaintiff would suffer irreparable damages in the absence of an injunction, certainly a bond to pay the damages, which are not capable of “ready computation and ascertainment,” would not afford him full protection. In so far, therefore, as the judge allowed the defendants to dissolve the injunction granted upon the giving of a bond, his judgment will be Reversed. All the Justices concur, except Bede, P. J., absent.