Opinion
Argued October 22, 1888
Decided November 27, 1888
Alexander N. Campbell for appellant. Jefferson Clark for respondents.
If the brands in question were trade-marks, so that they indicated that the iron upon which they were placed was of the manufacture of the plaintiff, or of the firm of which he had been a member, or that it had been galvanized by him or his firm, or specially sold by him or them, we think the right to exclusively use them on iron galvanized by the plaintiff, passed to him by virtue of the written papers signed by the parties at the time of the dissolution.
They were brands which had been designed by the plaintiff while a member of the firm of John Merry Co., and had been used by that firm, and we think had passed to the firm composed of the plaintiff and the defendants' testator. Although the words "good will" were not mentioned in the papers (other than in Exhibit F., which was not signed by the parties, and which the defendant does not recollect even to have seen), yet it is evident, from an inspection of the papers which were signed by him, that it was meant to pass, and when defendant denies it he merely denies a conclusion of law, as the intention to pass it is derived from the documents signed by the parties. In Shipwright v. Clements (19 W.R. 599), MALINS, V.C., held, that where a business was sold the entire good will and right to use trade-marks pass to the purchaser, without any express mention of them being made in the deed of assignment. (See, also, Hudson v. Osborne, 18 W.R., Ch. Dig. 44, paragraph 15; S.C., 39 L.J.R. [N.S.] 79.) The effect of the transaction between the parties, as evidenced in the papers executed by them, was a sale of the business, its good will and its trade-marks to the plaintiff by the defendants' testator. All the liabilities of the late firm were assumed by the plaintiff, and he was to succeed it in the same business and at the same place, and for this purpose the defendants' testator assigned the lease of the premises to plaintiff, and, in substance, sold the plant to him, and among the articles of property contained in the inventory of such plant were stencil plates which made the brands. The agreement of dissolution specified exactly what the defendant was to have from the firm, and the good will was not there included, nor any marks or brands, nor was defendant to succeed to the business, or any part thereof, and what the defendant did not take it was meant the plaintiff should have. After the dissolution it was found as a fact by the court, that both parties engaged in the business of dealing in galvanized iron in New York, and both parties used these brands, the plaintiff upon iron galvanized by him, and the defendant upon iron galvanized for him by other parties, pursuant to his order.
The court found as a conclusion of law that the plaintiff never acquired and never had the exclusive right to use these marks, and that the defendant had the same right which plaintiff had to their use.
There is no express finding that these brands were trade-marks, and the evidence on the subject is contradictory.
The plaintiff testifies to a state of facts which would leave no doubt that they indicated that the iron upon which they were found was not alone of a certain quality, but that it had been galvanized by the plaintiff, or by a firm of which he was a member, and that such iron thus galvanized had a large sale through the country and the brands were valuable as a trade-mark.
But the defendant, on the contrary, testified in so many words that the brands indicated nothing of the sort; that they simply indicated that the iron itself upon which they were found was iron of the first or second quality (according to the brand which was used), and did not in any way indicate or represent that the plaintiff or any other special person or firm had manufactured or galvanized it, or that the galvanizing was of any particular quality; that if the words, "best bloom iron" had been used in the one case, and "good second quality charcoal iron" had been used in the other, all the information would have been imparted to those in the trade that they would have acquired from seeing these brands upon the iron; that it was simply a short way to describe the original quality of the iron which had been subjected to the galvanizing process, and the iron itself was not manufactured by plaintiff, nor had he any connection with its manufacture.
If the brands had only this meaning and significance, it is plain that the plaintiff would have no right to prevent the defendants from using them, for the exclusive right to use them would not pass as part of the good will or as a trade-mark; while, if the plaintiff's contention were true, it is equally plain, upon our construction of the dissolution articles, that he would have such right. The court, upon this, and several other questions, was requested to find in accordance with the plaintiff's contention, and refused to do so, "except so far as they (the requests) are covered by the findings signed on application of defendants."
There is no express and separate finding on this subject signed by the court on application of defendants, or at all. But upon the fact (with others) found by the court that "no mention was made of any trade-mark in any of the papers executed by said parties upon the dissolution of said firm, and that neither partner expressly conveyed to the other any right to the use of any marks or brands," the court found as a conclusion of law that the plaintiff never acquired and never had the exclusive right to the use of the marks or brands aforesaid, and that the defendants had the same right which plaintiff had to use such brands or marks.
The result of the finding of the court and its conclusion of law is that, assuming these marks to be a trade-mark, there is no evidence of an exclusive right to its use by plaintiff, and for that reason the complaint was dismissed. Although it did refuse to find the facts as to the trade-mark when specially asked so to do by the plaintiff, other than as was contained in the findings for defendants, yet the finding of fact which it did make for defendants and the conclusion of law therefrom, render it clear that the court assumed the fact as existing (and in the above seventh finding so treated it), that the brands were trade-marks, although still deciding that the right to their exclusive use did not rest with the plaintiff.
In this we think there was error, and the exception to the conclusion of law reaches it. Upon a new trial it can be plainly discussed and the facts found one way or the other upon which the question depends whether these brands were trade-marks or were mere labels indicative of the quality of iron upon which the galvanizing process had been performed.
The cases of Huwer v. Dannenhoffer ( 82 N.Y. 499), and Hazard v. Caswell (93 id. 259), are not in conflict with the decision of this case. They simply hold that a trade-mark used by a firm is an asset of the firm, and upon a dissolution each partner has the right to use it unless he has vested the other with an exclusive right to do so, and that it is incumbent upon the partner who claims such exclusive right to prove himself vested with it.
In this case we hold that if these were trade-marks then the plaintiff has proved such exclusive right, so far as the facts are now presented.
The judgment should be reversed and a new trial ordered, with costs to abide the event.
All concur.
Judgment reversed.