Getz Bros. & Co. v. Federal Salt Co.

HENSHAW, J.

This is an action upon two checks, each for the sum of five thousand dollars, drawn by the defendant upon the Bank of California, and payable to the order of plaintiff. The checks were drawn .December 18, 1901, were presented for and refused payment December 31, 1901. Defendant for answer to the action set up as an affirmative defense that the checks were made and delivered as an integral part of a certain transaction between the parties, evidenced by written contracts. The court found the facts as set up in the answer, found further that the written contracts between the parties were against public policy, in restraint of trade, and in violation of an act of Congress known as the Anti-trust or Sherman Act, and gave judgment for defendant accordingly. The court’s decision in this regard is presented for review upon this appeal.

The written contracts were executed upon the same day and date with the checks and as a part of the same transaction. They recited that the plaintiff owned 1,336 tons of factory-filled salt, one hundred tons of coarse common salt, and eighty tons of dairy salt, all of which were on board ship in transit from Liverpool to San Francisco, and that the defendant, Federal Salt Company, desired to purchase the same. Wherefore Getz Brothers & Co. sold all of the salt to the Federal Salt Company, which agreed to pay the original cost-price of the salt, including freight, insurance, duty, and all expense of landing the salt in San Francisco, and it agreed in addition thereto to pay to Getz Brothers & Co. the sum of ten thousand dollars in cash, the receipt of which was acknowledged by Getz Brothers & Co. Getz Brothers

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Co. then further*agreed to assign to the Federal Salt Company all their rights to purchase salt, and all the options which they had, or might thereafter secure within a period of two

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years, either in England or elsewhere, and they agreed further, that any salt which they might then own, or have contracted for, or which they might thereafter purchase within two years, other than such salt as might be purchased from the Federal Salt Company, should be sold by them to the Federal Salt Company at ten per cent below the actual cost. Such was the substance of the first contract. The second contemporaneous agreement declared:—