CONTROL THE TRUSTS BY CONGRESS 2ig 



is first considered, and if it be not involved and the restraint 

 upon one party is no greater than protection to the other party 

 requires, the contract may be sustained. The question is 

 whether, under the particular circumstances of the case and 

 the nature of the particular contract involved in it, the con- 

 tract is or is not reasonable. 



Let me give an illustration showing the difference be- 

 tween a reasonable and unreasonable arrangement or contract 

 at common law. First, as to a reasonable one : 



The case of a sale of a business and its good will is a good 

 illustration. Here a restricted covenant upon the part of the 

 vender not to engage in competition in a similar business is 

 often the main consideration for the transaction. This cov- 

 enant is, of course, in restraint of trade and interferes with 

 competition. But to make a contract such as this illegal is 

 not only restrictive of the liberty of contract, but it is depriv- 

 ing one of his property without due process of law. Good 

 will is property capable of being appraised, bought, and sold. 

 In many cases it is the main ingredient of value. It repre- 

 sents all the struggle, industry, tact, and judgment that 

 makes success. In estimating the worth of a business it is not 

 infrequently reckoned more valuable than the buildings and 

 machinery that make up the physical plant. Such a contract 

 has been held reasonable and valid. 



Now as to an unreasonable agreement, let me quote 

 an illustration from the pen of a justice of the Supreme 

 court : 



In Morris Run Coal company vs. Barclay Coal company 

 (in the Supreme court of Pennsylvania) the principal question 

 was as to the validity of a contract made between five coal 

 corporations of Pennsylvania, by which they divided between 

 themselves two coal regions of which they had the control. 

 The referee in the case found that those companies acquired 

 under their arrangement the power to control the entire market 

 for bituminous coal in the northern part of the state, and their 

 combination was, therefore, a restraint upon trade and against 

 public policy. In response to the suggestion that the real pur- 

 pose of the combination was to lessen expenses, to advance 

 the quality of coal, and to deliver it in the markets intended 



