Keene

Walter M. Keene and his wife brought this action against Fred Harling and Morris Blum for the balance due on a promissory note given as part of the purchase price for a business involving coin-operated machines. Defendants’ sole defense was that the sales agreement was illegal. The trial court found that the transfer of a minor part of the consideration given by the Keenes in exchange for the note was, in fact, illegal, but held that the illegal portion was severable from the remaining consideration. Judgment was therefore entered in favor of the plaintiffs for the amount due on the note, less the value of the illegal consideration. Defendant Harling alone appealed.

The facts are as follows: For several years prior to September 1, 1955, Walter Keene owned and operated a coin machine route. On that date he and his wife entered into a conditional sales agreement whereby they sold the route to defendant Harling, together with all the equipment of the business. The Keenes agreed to sell the route and equipment, and to refrain from competing with the buyer for five years. Harling, in return, agreed to pay $50,000 for the route and equipment, $10,000 at the time of execution, plus $750…