Malone v. Jones

BURKE, P. J.

This is an appeal from judgments entered granting motions for summary judgment in two separate eases which were consolidated in the trial court.

In the first action Luther S. Malone (Malone) sued Homer Campbell .Jones (Jones) for breach of contract and for fraud. The second action was a complaint for money brought by Jones against Malone.

The two men were partners in a sewer business which involved two basic divisions in operations: one, the construction of septic tanks, cesspools and sewers, termed the “construction segment”; the other involved the pumping out and servicing of septic tanks and cesspools, termed the

1

‘ pumping segment. ’ ’

The parties dissolved their partnership approximately 14 months prior to the commencement of these actions, with the “construction segment” going to Malone and the “pumping segment” to Jones.

As partial consideration for obtaining the more valuable part of the operation, Malone gave Jones credit for $23,000

1

worth of materials and inventories and purchased the following aspects of the “construction segment” for $25,000:

1. the going concern

value;

2.

the right to all referrals from the “pumping segment” of the business; and

3. Jones’ covenant not to compete with the “construction segment” of the business within a 50-mile radius of Pomona for a period of 18 months.

Within 30 days Malone paid Jones $8,000 as a down payment for his part of the business and agreed to pay the balance of $17,000 in six equal installments evidenced by a non-interest-bearing promissory note. At the time Malone filed his complaint in his action for breach of contract and for fraud, he had paid Jones nearly $14,000 for the “eon

[345]