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Good Will,

Good will is regarded as a species of property of a mercantile nature in as much as in certain cases, it possesses an existing and valuable interest. Hence it is recognized as partnership assets. Good-will of a business may be defined to the advantage or benefit which is acquired by an establishment, beyond the mere value of the capital stock, funds, or property employed therein, in consequence of the general public patronage and encouragement which it receives from constant or habitual customers, on account of its local position or common celebrity, or reputation for skill or affluence, or punctuality or from other accidental circumstances or necessities, or even from ancient partialities or prejudices. The claims or interests of the partnership arising from contracts made with them, or on their vested and exclusive rights, however acquired, seem to be excluded from the meaning of good-will; for the only proper signification of the word must be that benefit or advantage that rests on the goodwill or kind and friendly feeling of others, and which of course can be wholly lost without giving rise to any legal right or ground of complaint. [PARSONS.]

Good-will like any other personalty may be made the subject of sale or gift, and it is recognized as a partnership asset. Should a firm go into insolvency its good-will passes into the hands of the assignees. It has been decided in New York State that when on the petition of one of the partners to wind up the business, a receiver is appointed, the receiver shall carry on the business and preserve the good-will until a sale is completed.

When a firm ceases by its own limitation, the members of said firm have no good-will of the business in their favor, nor have they any exclusive right to follow in that place.

In case the good-will of a business has been sold to another for a valuable amount, the seller can be restrained in equity for representing himself to the public by advertisement, or in any other manner, as continuing his former business, or as continuing said business in another place. Should a teacher for instance, represent that he would cease teaching in a certain locality, as a condition of leasing his academy, the purchaser of the lease can enjoin him from teaching in that locality until the expiration of the lease, or a physician who disposes of his good-will with his practice can be enjoined from practicing in that locality, although such may not be specified in the contract. But it has been decided that where a party sold the appurtenances of his newspaper establishment, together with his good-will, he was not debarred from establishing another newspaper in the same town, even though he took away some of the former's subscribers. As the good-will of a business consists in the expectation that patrons will continue to come to the old place of business, it is only co-extensive with the business there carried on; so that the seller thereof may lease other property in the same locality to another who may carry on the same business, provided the lessee has no interest in said business.

The name under which a business is carried on is part of the good-will of the business. The buyer of all the partnership business of a firm, cannot use the name of the firm or his goods in his business, or carry on business in their name.