SMITH v. STEELE.

Contract-Physicians-Sale of Professional Practice-Breach

tiff.

Damages.

Action for damages for breach of a contract.

G. M. Vance, K.C., and W. H. Wright, Owen Sound, for plain

W. H. Blake, K.C., for defendant.

BRITTON, J.-The parties are physicians resident in Shelburne, Ontario, and this action is for the breach of a contract in writing between them, made on 14th December, 1906. The agreement is not difficult to construe. It refers to different matters, but is one agreement, and the intention of the parties in entering into it was that the defendant should sell to the plaintiff and that plaintiff should purchase the defendant's professional practice, good-will, residence and other property. The plaintiff, however, before settling down to the more extensive practice which would naturally follow from defendant's leaving Shelburne, desired to take a post-graduate course in New York, and to practise with defendant, having the advantage of defendant's personal introduction of plaintiff to defendant's work; so 1st May, 1907, was agreed upon as the time for plaintiff to finally take over defendant's practice and property. This agreement then provided for a partnership from 1st January to 1st May, 1907.

To begin with, the defendant was to take over, so far as possible, all of plaintiff's patients and practice, and the plaintiff was to receive from the defendant, for this, for the time plaintiff would be absent from Shelburne taking this post-graduate course, $7 a week. Upon the return of plaintiff to Shelburne he was to take an active part in this joint practice to be carried on in the office occupied by the defendant. The plaintiff was to allow the defendant $7 a month as his share for the use of the office, including its heating and lighting. The plaintiff was to procure and keep one horse for his own use exclusively. The defendant was to keep one or more horses for his own use exclusively. The plaintiff was to pay for one-half the cost of drugs and horse feed, and he was to get as his share of this partnership business, from the time of his return to Shelburne to actual practice, until 1st May, 1907, one-half the proceeds of such practice.

On 1st May the plaintiff was to pay $2,000, and the defendant was to convey his residence to the plaintiff, and the defendant was

to assign and hand over to the plaintiff certain shelving, electric light fixtures, curtains, telegraph line and connections, and stock in a telephone association. The defendant was also to assign his good-will in the practice to the plaintiff. The $2,000 was to be paid as follows: $1,000 in cash, and $1,000 by assuming an outstanding mortgage on the residence for that amount. In addition to the above, the plaintiff was to purchase and take over from the defendant certain stoves, pipes, blinds, linoleum, and drugs, for the further sum of $125, to be paid by the plaintiff to the defendant. The adjustments as to taxes, interest and insurance were to be made as of 1st May, 1907.

The defendant also agreed that upon giving up his practice in Shelburne he would not resume it at or within 15 miles of that place. It is not necessary for the purpose of this action to consider what was the effect, if any, of the plaintiff not having searched the title to defendant's residence before 1st January, 1907. The defendant was in possession, and, no doubt, had a good title, and the plaintiff could accept it without search, if he desired.

The plaintiff left Shelburne for New York on 31st December, 1906. The defendant had from 14th December, 1906, to 1st January, 1907, to consider his contract. He could, at any time between these dates, had he desired to do so, have retreated from and rescinded the agreement, forfeiting to the plaintiff $200, but he did not do so. On the contrary, on 1st January, 1907, the defendant entered upon the performance of it. He took over and continued the plaintiff's practice, paying to the plaintiff, for eight weeks, the $7 per week as stipulated.

The plaintiff returned to Shelburne on 8th March, and announced his readiness to practise with the defendant, but defendant said he did not intend to leave Shelburne, and he gave as a reason for not carrying out his agreement that a Mr. Morton, the mortgagee, would not allow plaintiff to assume the mortgage. That was a matter the defendant need not concern himself about. The plaintiff had agreed to assume it, and if Mr. Morton would not continue it, then plaintiff would be obliged to pay it, and failing to do so, he and not the defendant would in that respect be in default.

On the following Monday (the 11th March) the plaintiff presented himself ready to assume his part of the joint practice, and the defendant refused to permit plaintiff to do so. I am of opinion that this was ample notice to plaintiff of the defendant's intention not to perform his contract.

I find that the refusal of defendant to permit plaintiff to enter upon the practice of his profession with defendant, on defendant's

premises, was an absolute and unequivocal notice to the plaintiff of the defendant's intention of renouncing and repudiating the contract. This action of the defendant was not taken from any mistaken construction of the agreement, nor was it a mere expression of present disability to perform it, but it was a complete and unqualified refusal, so as to entitle the plaintiff to sue at once for a breach by the defendant. The plaintiff did not, however, commence this action until 29th August, 1907. I am of opinion that, owing to the conduct of the defendant and the refusal by him, no tender of money or of conveyance by plaintiff was necessary.

The defendant, long after his refusal to allow plaintiff to practise with him, viz., on 23rd April, made a qualified avowal of his readiness to carry out the agreement, by saying that the account of the partnership and the conveyance would be ready after the receipt of an "accepted cheque" payable on 1st May. The account of the partnership here would be only of work by defendant; plaintiff should have joined in the work, but defendant would not allow this. The conveyance and the account of profits were only part of the agreement. The plaintiff did not want defendant's residence or other property without his practice, and he wanted that practice with the good-will of the defendant, and an agreement that defendant would not practise within 15 miles of Shelburne. The defendant never, since the plaintiff's return from New York, offered to carry out the agreement in its entirety-in fact, he could not, after it was broken by defendant, as I have said. The defendant had no right to rescind after breach. The amount named was fixed as a forfeiture in case of rescission.

The defendant received the benefit of plaintiff's practice for the ten weeks, or, to put it on the lowest ground, if defendant did not get any benefit from that, the plaintiff's connection was broken, and he necessarily lost more or less by handing his patients over to a rival doctor in a small place.

As to damages, they cannot be accurately measured. The plaintiff speedily attempted to put himself in a position to recover lost. ground, but his whole plan was thwarted, and he is now only one of two, and his rival has, at all events, had the introduction to, and association with, the plaintiff's patients. The plaintiff has sustained substantial loss and damage by defendant's breach. Although the amount named as a forfeiture is not the measure of plaintiff's damage, still, as it was tendered to the plaintiff, it is some evidence that such an amount would not be too much in case of breach.

If the defendant had rescinded before 1st January, 1907, the

plaintiff would have received the $200, without having sustained any actual loss other than what would follow from changing his plans about going to New York. I think the plaintiff has sustained damage to the amount of at least $200 by reason of defendant's breach.

The plaintiff is entitled to two additional weeks at $7 a week during his absence from Shelburne. So I find in favor of plaintiff for $214.

I find that the defendant, before action, tendered to the plaintiff $200 in full settlement of any cause of action under the agreement mentioned. This sum was refused by the plaintiff. No money was paid into Court by the defendant.

Judgment for plaintiff for $214 with costs.-The Ontario Weekly Reporter.

Proceedings of Societies.

CANADIAN MEDICAL ASSOCIATION, 41st ANNUAL MEETING OTTAWA, JUNE 9th, 10th and 11th, 1908.

The opportunity to visit the Capital when Parliament is in session presents itself for the first time in the history of the Canadian Medical Association. The Forty-first Annual Meeting is the first under the new constitution. Come and help consolidate the profession all over Canada, and get better acquainted with the Canadian Medical Association and also with the Canadian Medical Protective Association.

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