Morison v Moat
| Jurisdiction | England & Wales |
| Judgment Date | 20 August 1851 |
| Date | 20 August 1851 |
| Court | High Court of Chancery |
English Reports Citation: 68 E.R. 492
HIGH COURT OF CHANCERY
Affirmed, 21 L. J. Ch. 248; 16 Jur. 321. See Reuter's Telegram Company v. Byron, 1874, 43 L. J. Ch. 663; Tuch v. Priester, 1887, 19 Q. B. D. 639; Pollard v. Photographic Company, 1888, 40 Ch. D. 353; Lamb v. Evans [1893], 1 Ch. 235; Robb v. Green [1895], 2 Q. B. 16, 319; Trego v. Hunt [1895], 1 Ch. 468; [1896], A. C. 7.
[241] morison v. moat. August 5, 6, 20, 1851. [Affirmed, 21 L. J. Ch. 248; 16 Jur. 321. See Eeuter's Telegrarti Cmnpany v. Byron, 1874, 43 L. J. Ch. 663; Tuch v. Priester, 1887, 19 Q. B. D. 639; Pollard v. Photographic Company, 1888, 40 Ch. D. 353; Lamb v. Evans [1893], 1 Ch. 235; Bobb v. Green [1895], 2 Q. B. 16, 319; Trego v. Hunt [1895], 1 Ch. 468; [1896], A. C. 7.] An injunction granted to restrain the use of a secret in the compounding of a medicine, not being the subject of a patent, and to restrain the sale of such medicine by a Defendant, who acquired a knowledge of the secret in violation of the contract of the party by whom it was communicated, and in breach of trust and confidence. A Plaintiff, not having the privileges of a patentee, may have no title to be protected in the exclusive manufacture and sale of a medicine against the world; but he may, notwithstanding, have a good title to protection against the particular Defendant. The case of a secret acquired by a breach of faith or confidence, but communicated to a purchaser for value, without notice of any obligation affecting it, distinguished from that of a party whose claim of right to use the secret is that of a volunteer. The Court, in interfering in such cases upon the ground of faith or confidence, fastens upon the conscience of the party, and enforces the obligation against him, as it enforces, against a party to whom a benefit is given, an obligation to perform a promise upon the faith of which the benefit has been conferred-semble. If a partner in a business, in which a secret process of manufacture and composition of materials is used, who has not, under the partnership contract, a right to the knowledge of the secret, should openly take part in the manufacture, and should, with the knowledge and concurrence of his partners, be permitted to acquire a knowledge of the process and ingredients, the other partners will be considered to have waived a right to the preservation of the secret for their separate benefit- semble. The injunction restrained the sale of medicine by the Defendant under the name of the medicine prepared according to the secret prescription, not on the ground of the use of the name alone, but because it was by the use of the name that the Defendant was availing himself of the breach of faith and contract. Whether, apart from that ground of interference, the Court would have restrained the use of the name before the Plaintiff's right had been established at law-qucere. Bonds executed by partners to each other, relating to their rights as partners, of the same date as the partnership deed, read with the deed as part of the partnership contract. The payment of the expenses of advertisements out of partnership funds is not necessarily a ground for giving to each partner, at the expiration of the partnership, a continuing share in the advantages of publicity produced by the advertisement; the partnership having had, during its continuance, the benefit of the expenditure. Effect of notice that a claim will be resisted, in excluding an objection to relief on the ground of laches or acquiescence. 9HAKE, 242. MOB1SON V. MOAT 493 A motion for an injunction to restrain the Defendant from making or selling medicines as " Morison's Universal Medicine," and from using the name, and using or communicating the knowledge or secret of their composition. The Plaintiffs were Alexander and John Morison, the two sons of James Morison: they were also two of the surviving partners in the firm of Morison, Moat & Co.; and they were, under the will of James Morison, legatees of the recipe and prescription for preparing the medicine, upon trusts for themselves and other members of the family of James Morison. The Defendant was the son of Thomas Moat, and was the appointee of his share in the partnership, and the other surviving partner in the firm. The question was whether the partnership and the attendant circumstances had given the Defendant the right .which the Plaintiffs sought to restrain him from assuming or exercising. The partnership was formed by James Morison and [242] Thomas Moat, by a deed of the 23d of June 1830, which recited that James Morison was the inventor and sole proprietor of the medicine, the secret of making which he had communicated to his son John; and that James Morison had, in consideration of the past services of Thomas Moat, and in further consideration that Thomas Moat should devote his whole time and attention to the conduct and promotion of the manufacture and sale of the medicine, agreed to take him into partnership with him (James Morison) in the manufacture and sale of such medicine, upon the terms therein stated. The material terms were that they were to be partners in the profession and business of manufacturers and vendors of the medicines for twenty years and three-quarters, from the 24th of June 1830 ; the style of the firm to be " Morison, Moat & Co., Hygeists;" the business,,, to be carried on in certain specified premises, and there and thence alone (excepting the foreign establishments) the medicines were to be compounded and issued to the agents of the co-partnership ; with power to the partners for the time being to remove the establishment as might be convenient; the premises where the business should be carried on to be called "The British College of Health;" the partners to be entitled to the profits, and liable to the losses, in the proportion of two-thirds to James Morison and one-third to Thomas Moat. If Thomas Moat should die before the 25th of March 1851 his interest in the co-partnership not to devolve upon his personal representatives; but to belong to such person (not being a female) as he should appoint; and, in default of appointment, to devolve upon James Morison, his appointees, executors, administrators or assigns. Thomas Moat was to devote his time and attention in the conduct and promotion of the manufacture and sale of the medicine, or in such other manner as should best conduce to the advantage of the partnership; James Morison not to be obliged to devote any more time or [243] attention thereto than he should think proper. James Morison "to be at liberty to introduce into the partnership any person or persons whomsoever (not being a female) upon the same conditions as Thomas Moat was subjected to. James Morison, on or before the commencement of the partnership, to communicate to Thomas Moat the knowledge of the mode of making and compounding the medicine, and to be at liberty to communicate such knowledge to such person or persons as he was thereby empowered to introduce into the partnership. James Morison, notwithstanding anything therein to the contrary, to be at liberty to form an establishment in any part of the world, except the United Kingdom and America, for the manufacture and sale of the medicine; and all which he might order or receive from the partnership to be charged to him at a certain price. If Thomas Moat should live to the expiration of the partnership a new partnership for a further term to be agreed upon between the parties to be entered into on similar terms. And there were provisions for taking the accounts of the partnership in the event of the death of either, or of the introduction of a new partner. Contemporaneously with the partnership deed, two bonds were executed, bearing the same date as the deed, one by each of the partners to the other, and each being for the penal sum of 5000, reciting the partnership deed; that the prosperity of the partnership would depend upon the ingredients and the mode of making and compounding the medicine being kept secret; and that James Morison, the inventor thereof, had communicated the secret to Thomas Moat. The condition of the bond of Thomas Moat was that he should not at any time or times thereafter, in any way 494* MORISON v: MOAT 9 HARE, 244. a or manner, make known, or divulge or communicate, the said secret to any person or persons whomsoever. The condition of the bond of James Morison was that he should not at any time thereafter, in any [244] way or manner, make known or divulge the said secret of the ingredients, and the mode of making and compounding the medicine or medicines, to any person or persons whomsoever, save and except such person or persons as he and the said Thomas Moat might introduce into the partnership under the powers of the partnership deed, or any of them, and except such person or persons as Morison might introduce into the foreign partnerships, which he was thereby authorised to establish. James Morison introduced into the partnership the Plaintiff Alexander in June 1834, and the Plaintiff John in July 1835, and gave each of them one-twentieth of his (James Morison's) share. By a deed of January 1836 James Morison appointed that, at his decease, the Plaintiffs should be partners in the remainder of his share. Shortly after the date of the partnership deed Thomas Moat appointed his son Horatio to succeed him in the partnership. On the 29th of July 1835 an agreement was entered into between James Morison, Thomas Moat and the Plaintiffs of the first part; and Horatio Moat and the Defendant of the second and third parts; whereby, after reciting the intention of Thomas Moat to appoint his share to the Defendant instead of to Horatio Moat; and that Thomas Moat had for some time been in ill-health, which had prevented him from attending to the business of the partnership; and that it was intended that the Defendant should, during such time as Thomas Moat continued unwell, transact the business of...
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