beer, nor shall they, directly or indirectly, loan, give away, or furnish equipment, money, credit, or property of any kind, except ordinary commercial credit for such beer sold to such retail dealers.

Section 13139-20 provides that any person violating any of the provisions of this act shall be deemed guilty of a misdemeanor, except where the punishment is specifically prescribed by this act, and shall be punished by imprisonment in the county jail for a term of not more than one year, or by a fine not less than $50 nor more than $1,000, or by both. See Tying Contracts and Exclusive Dealing Arrangements, infra.

2. Public Contract Provisions

Stat. Ann. (1932)

Paper and Stationery

Section 13806 provides that bids for paper or stationery for the use of the state may be set aside by the Commissioners of Printing if they have reason to believe the bidding therefor is unfair, fraudulent, or exorbitant. See projected Vol., Governmental Purchasing.

Printing

Section 13792 provides that the Commissioners of Printing may set aside the bidding and relet a contract for printing if they believe that the bidding therefor is unfair, fraudulent, or exorbitant through combinations or otherwise. See projected Vol., Governmental Purchasing.

Construction Contracts

Section 4431 provides that any collusion or combination of persons or firms for the purpose of restricting bids or limiting the number of bidders on any contract for the construction of a state highway, levee, drainage ditch, or public building shall be punished by imprisonment of from two to five years or by a fine of not less than one thousand dollars or both. See projected Vol., Governmental Purchasing.

Textbooks

Section 9501 provides that a textbook publisher must file a sworn statement with the State Superintendent of Public Schools that he has no understanding or agreement with any other publisher or interest in the business of any other publisher, with the effect or intent to control the prices of school textbooks or to restrict competition in the adoption or sale thereof.

Section 9502 provides that before being licensed to sell school textbooks, a publisher shall file a sworn statement of the ownership of the publishing house. This must state whether the publisher or the owner of any interest in the establishment is also the owner of an interest in any other publishing house.

Section 9503 provides that, if a publisher enters into a combination or agreement to restrict competition in the adoption or sale of school books or if the statements required in sections 9501 and 9502 are untrue in any respect, the attorney general shall institute proceeding for the forfeiture of the publisher's bond and for the revocation of his authority to sell school books in the state and that all contracts made by the publisher under the statute shall become void at the option of the other party thereto. See projected Vol., Governmental Purchasing.

No provisions.

Railroads.

3. Anticoercive Financing Statutes

Judicial Decisions

Art. XII, sec. 17, of the Missouri Constitution is inapplicable to companies owning lines of railroads used only in a terminal business. State ex rel. Attorney General v. Terminal Association of St. Louis, 182 Mo. 284, 81 S. W. 395 (1904).

Under art. XII, sec. 17, of the Missouri Constitution and under section 4692 (repealed, L. 1939) a company owning, operating, or managing a railroad in Missouri is prohibited from leasing, purchasing, or exercising any control over any other railroad in the state that is substantially parallel to or a competitor of such railroad. And where the statute speaks of competing roads, it refers to substantial competition. Competition amounting to 1 percent of the traffic of one road is not sufficiently substantial so as to come within the purview of the Statute. Kimball et al. v. Atchison, Topeka & Santa Fe Railroad Co. et al., 46 Fed. 888 (1891). There is dictum in St. Louis, Kennett & Southern Railroad Co. et al. v. Wear, Judge, 135 Mo. 230, 36 S. W. 357 (1896), to the effect that art. XII, sec. 17, of the State Constitution and sections 4692 and 4693 prevent the president of a railroad company from being named as receiver for a competing railroad.

Where the receiver of A Railroad did not desire to assume a contract by A with B because of a contract with C, the court would not

at the instance of B inquire whether the 14-year-old contract between A and C violated art. XII, sec. 17, and section 4692. Kansas City Southern Railway Co. v. Lusk et al., 224 Fed. 704 (C. C. A. 8th 1915).

Interpreting a section similar to section 4688, the court stated that the failure of each of two railroads about to be consolidated to file with the secretary of state a resolution passed by a majority of its stockholders accepting the provisions of the act to consolidate railroads, does not render such consolidation void, and only the State can take advantage of such failure to file the resolution. Leavenworth County Commissioners v. Chicago, Rock Island & Pacific Railway Co., 134 U. S. 688, 10 Sup. Ct. 708, 33 L. Ed. 1064 (1890). Commission Merchants.

Section 12655, forbidding commission merchants from entering into combinations to fix prices of farm products, does not violate either the Federal or State constitution. Arnold et al. v. Hanna et al., 315 Mo. 823, 290 S. W. 416 (1926), aff'd. 276 U. S. 591, 48 Sup. Ct. 212, 72 L. Ed. 721 (1927).

Public Contract Provisions

Any contract the necessary effect of which is to stifle competition in bidding on or letting of public contracts is void as in violation of public policy. Engelman v. Skrainka et al., 14 Mo. App. 438 (1883); Pendleton v. Asbury, 104 Mo. App. 723, 78 S. W. 651 (1904); Henry County v. Citizens Bank of Windsor, 208 Mo. 209, 106 S. W. 622 (1907).

II. CONTRACTS NOT TO COMPETE

No statutory provisions.

Judicial Decisions

1. Restrictive Covenants Ancillary to Sale of a Business.

In the sale of a dairy business, a covenant not to compete within the same county as long as the vendee should continue in business. was held valid in Lawson v. Edwards, 293 S. W. 794 (1927). The vendee is estopped from enforcing the restrictive covenant where the vendor reenters the dairy business at the suggestion of the vendee. Ibid.

A covenant, ancillary to the sale of a glass business, not to compete with the vendee corporation within a radius of 25 miles of a city as long as the vendee remained in business there was held not unlawful as in restraint of trade. Failure to include a definite time limitation in a covenant does not invalidate it. A court may hear parol evidence as to the actual intent of the parties. Kreger Glass Co. v. Kreger et al., 49 S. W. (2d), 260 (1932).

Where A sells his match factory to B, agreeing not to enter into the match manufacturing business at X or any other place for 5 years, the promise not to manufacture at X is severable from the promise not to compete at any other place. The former promise will be held binding. Peltz et al. v. Eichele, 62 Mo. 171 (1876).

A contract by defendant, manufacturer of jackets, not to compete with the vendee of her business for 9 years in the 33 States and Territories where she had done business was held valid and was enforced by injunction. Angelica Jacket Co. v. Angelica, 121 Mo. App. 226, 98 S. W. 805 (1906).

Where defendant sold his produce business to plaintiff, agreeing not to engage in that business "at" the town of R for 5 years, "at" should be construed to mean "near or about" so as to prohibit defendant from purchasing produce for shipment at H, a town 12 miles from R. Counts v. Medley, 163 Mo. App. 546, 146 S. W. 465 (1912).

An agreement, ancillary to the sale of an undertaking business, that the seller would not reenter business within 10 miles of the city of X was held to prohibit actively reentering business in the area

and not merely the reestablishment of an office there. Hessel v. Hill, 38 S. W. (2d), 490 (1931).

Restrictive Covenants Ancillary to Sale of a Professional Practice.

A physician selling the building containing his house and office to another physician and agreeing not to establish himself as a practicing physician within 5 miles of premises within 5 years cannot set up an office within the prohibited area, but is not prevented from attending patients within the area from an office outside it. A contract not to compete is one in restraint of trade, and the restraint of personal liberty should not be construed to extend beyond its proper import. State ex rel. Youngman v. Calhoun, 231 S. W. 647 (1921). Where two physicians one of whom is a newcomer in the city form a partnership at will, the newcomer promising not to practice within 10 miles of the office for 10 years after dissolution of the partnership, the agreement is not void for lack of consideration. Glover v. Shirley, 169 Mo. App. 637, 155 S. W. 878 (1913).

A physician's covenant, ancillary to the sale of his practice, that he would not practice in the same county, unlimited as to time, was held valid in Gordon v. Mansfield, 84 Mo. App. 367 (1900).

Restrictive Covenants Ancillary to Employment.

A covenant by an ice-truck driver that he would not sell or deliver ice within a suitably limited area within one year after his employment with the ice company terminated was valid and enforceable by injunction, the employer's continuance of the driver in employment being sufficient consideration. If, however, the employer discharges the employee without cause, the covenant terminates. City Ice & Fuel Co. v. Snell, 57 S. W. (2d) 440 (1933); City Ice & Fuel Co. v. McKee, 57 S. W. (2d) 443 (1933).

Restrictive Covenants Not Ancillary to Sale of a Business Interest.

Where A contracts not to publish the X newspaper at Y as long as B is publishing his newspaper there, the contract is violated by a sale of A's paper to a vendee who continues its publication. Vandiver v. Robertson et al., 125 Mo. App. 307, 102 S. W. 659 (1907).

A covenant not to compete with a partnership does not terminate when the partnership changes its name without taking in any new partners. Gill et al. v. Ferris, 82 Mo. 156 (1884).

Where A agreed with B for an adequate consideration not to cement any hams during the life of B's patent for cementing them, the hams being sold in a national market, the agreement was held valid and not in unlawful restraint of trade. Billings v. Ames et al., 32 Mo. 265 (1862).