Chicago & E. R. v. Ohio City Lumber Co.

214 F. 751, 131 C.C.A. 57, 1914 U.S. App. LEXIS 1175

• Court: Court of Appeals for the Sixth Circuit
• Decided: June 12, 1914
• Docket: No. 2473
• Status: Published

Opinion

SESSIONS, District Judge.

This action was brought by the Ohio City Dumber Company and certain insurance companies (plaintiffs) to recover damages for the destruction of the plant of the lumber company by a fire alleged to have been started upon its premises by sparks from a passing engine of the railroad company (defendant). At the time of the fire each of the plaintiff insurance companies carried insurance on some of the property which was destroyed. After the fire and before the commencement of this action the insurance companies adjusted the loss with the lumber company and paid the amounts thus found 'to be owing under their respective policies. Issues relating to the origin of the fire, the negligence of the defendant, and the value of the property destroyed were raised by the pleadings, presented by the proofs, and submitted to and determined by the jury. There were verdict and judgment for the plaintiff, and the defendant brings this writ of error, assigning error upon the refusal of the trial court to direct a verdict in its favor, the admission of evidence, and the charge to the jury.

[1] Counsel for defendant insist that it was entitled to a verdict by'direction. This insistence is based upon the claim that the undisputed evidence in the case shows that the engines concerning which complaint is made were properly constructed and equipped and properly operated. It is true that several of defendant’s employés, including inspectors, mechanics, enginemen, and trainmen, testified in positive terms and apparently from knowledge that each of the engines, which could have set the fire, was equipped with spark-arresting apparatus in perfect condition and of the most approved arid effectual kind. The enginemen and trainmen also testified that each of the engines, while passing the lumber company’s plant, was carefully and skillfully handled and operated. On the other hand, several of plaintiffs’ witnesses, including workmen in the lumber yard and others in that immediate vicinity at the time, testified that at least one of these engines, while passing the lumber plant, threw out live sparks and embers much larger than any which could pass through a spark ar-rester of the kind described by defendant’s witnesses and required by the Ohio statute unless the arrester was defective or the engine improperly operated. The question thus presented was one of fact and for the jury to determine. L. & N. R. R. Co. v. Bell, 206 Fed. 395, 124 C. C. A. 277.

[2] The property destroyed by the fire consisted of a dwelling house, a stable, nine sheds, a stock of lumber, glass, builder’s hardware, and hay tools. The errors assigned upon the admission of evidence all relate to the testimony and proofs concerning the value of the burned property. Plaintiffs’ principal witness as to values was Joseph B. Kuntz, who, for about 4% years before the fire, had been.the manager of the lumber company’s business at Ohio City. In response to specific questions and over objection, Mr. Kuntz was permitted to state what, in his opinion, was the “fair and reasonable” value of each of the burned buildings just prior to the fire. Over like objection, he was permitted to place lump sum values upon the lumber, glass, builders’ hardware, and the tools. Defendants contend that this testimony was incompetent and therefore inadmissible: First, because the witness was not shown to be qualified to testify as to values; second, becaüse the values were stated in gross sums and not in detail; and, third, because the true measure of the value of the buildings was their “fair market” value and not their “fair and reasonable” value. These contentions are without merit. This record shows that Mr. Kuntz had been connected with the lumber business in various capacities for about 20 years. For 4% years he had been a director, secretary and treasurer, and manager of the Ohio City Dumber Company. During that time he had had sole charge of the business of that company, making all purchases and sales, keeping the books, checking and inspecting all goods received,' and making daily records and weekly reports of all goods sold. In so doing he must have become thoroughly familiar with the quantities, qualities, prices, and values of the goods in which he was dealing. He lived in the dwelling house and used the other buildings which were burned. He knew their age, location, use, and condition. He was acquainted with the value of building material. He had, frequently sold such materials to builders and contractors and was familiar with their estimates of the cost of construction. With such experience and such knowledge, he was well qualified to testify on the subject of values.

[3, 4] Where more accurate evidence is not available or obtainable, any person, whether owner, active manager, or employé, who is familiar with the property and goods connected 'with and used in a business, although not an expert, may testify as to the value of such property when destroyed by fire, and his estimates of value may be given in single or gross amounts. Union Pacific R. Co. v. Lucas, 136 Fed. 374, 377, 69 C. C. A. 218; Walker v. Collins, 50 Fed. 737, 740, 1 C. C. A. 642; Jensen v. Palatine Ins. Co., 81 Neb. 523, 116 N. W. 286; Thomason v. Capital Ins. Co., 92 Iowa, 72, 61 N. W. 843; Bolte & Jansen v. Equitable Fire Ins. Ass’n, 23 S. D. 240, 121 N. W. 773; Farley v. Spring Garden Ins. Co., 148 Wis. 622, 134 N. W. 1054, 1056; 17 Cyc. 113, 115.

[5] No hard and fast rule, applicable to all cases, can be laid down as to the measure of the loss suffered by the destruction of buildings by fire. In some instances it may be their value detached from the land and separated from the use made of them. In others, where an active market is shown to exist, the market value may be the fair measure of loss. In still others, the cost of reconstruction, after deducting depreciation from age and other causes, may fairly recompense the owner. Usually, however, the real or ordinary value of a building, based upon and determined from its cost, age, condition, location, and the uses to which it has been put, furnishes a fair measure of the loss occasioned by its destruction. In this case it appears that these buildings were located in a small village and had little, if any, market value. The use made of them in connection with the other property destroyed materially affected their value. Under such circumstances, it cannot be said that their market value, detached from the land and separated from the use to which they had been put, fairly represented the loss suffered by plaintiffs in their destruction. No error was committed in permitting the witness to testify as to the fair and reasonable value of these buildings, taking into consideration their age, depreciation, the cost of reconstruction, and their use in connection with the other property destroyed by the same fire. Close v. Ann Arbor R. Co., 169 Mich. 392, 135 N. W. 346; Matthews v. Mo. Pac. Ry. Co., 142 Mo. 645, 44 S. W. 802; McMahon v. City of Dubuque, 107 Iowa, 62, 77 N. W. 517, 70 Am. St. Rep. 143; Chicago & N. W. Ry. Co. v. Kendall, 186 Fed. 139, 141, 108 C. C. A. 251.

[6] This fire occurred July 15, 1908. About January 1st of that year, the witness Joseph B. Kuntz made a complete and detailed inventory of the lumber company’s property. This inventory was offered and received in evidence and Mr. Kuntz was permitted to refresh his recollection therefrom while testifying. The witness testified that he personally made the inventory in the due course of business, that he carefully and accurately counted the lumber and other articles of merchandise therein set forth, and that it showed “a complete list of every item on hand at the time it was made” with the cost price of each item which he said was the true value thereof. He further testified as to the purchases and sales made subsequent to the taking of the inventory, and also that the amount of stock on hand varied but little between the taking of the inventory and the time of the fire. No error was committed in receiving the inventory or in permitting the witness to use it and the jury to consider it. Wells Whip Co. v. Tanners’ Mut. Fire Ins. Co., 209 Pa. 488, 58 Atl. 894; Levine v. Lancashire Ins. Co., 66 Minn. 138, 68 N. W. 855; Coleman v. Retail Lumbermen’s Ins. Ass’n, 77 Minn. 31, 79 N. W. 588; German Ins. Co. v. Amsbaugh, 8 Kan. App. 197, 55 Pac. 481; West Branch Lumberman’s Exchange v. American Central Ins. Co., 183 Pa. 366, 38 Atl. 1081; Insurance Co. v. Weide, 9 Wall. 677, 19 L. Ed. 810; Insurance Companies v. Weide, 14 Wall. 375, 20 L. Ed. 894.

[7] After the fire Joseph B. Kuntz and his brother, John Kuntz, who was also a witness, prepared proofs of loss which were delivered to the insurance companies. These proofs of loss purported to 'be statements in detail of the lumber, glass, hardware, and other property which was burned. In the preparation of these statements, the two men worked about ten days and had before them and used the January inventory, all of the sales slips or records between. January 1st and July 15th, and the original invoices of all goods purchased between those dates. The quantity of goods destroyed was determined by adding the subsequent purchases to and subtracting the subsequent sales from the inventory. After the fire loss was adjusted with the insurance companies, the sales slips and invoices of purchases were believed to be of no further use and were destroyed. The values contained in the proofs of loss were as a whole considerably higher than those contained in,the inventory and’were quite thoroughly discredited. Complaint is made because these statements or proofs of loss were admitted in evidence and permitted to go to the jury. Whether or not these statements were competent evidence need not be determined. The record shows that, after they had been introduced and after the witnesses had been cross-examined concerning them, both the documents and the cross-examination with relation to the items contained therein were about to be stricken out by the court, when, at the suggestion of the defendant, they were retained. Also, at the request of the defendant, the jury was instructed not to consider them on the question of prices or values. Defendant is not now in a position to complain of this action.

The defendant offered no evidence as to the value of any of the property destroyed. If its counsel believed that the estimates of value given by plaintiffs’ witnesses were incorrect and too high, it would not have been difficult for them to show the true and correct value of staple articles of merchandise like lumber, glass, and hardware. Having made no effort to disprove or contradict plaintiffs’ proofs in that regard, it is fair to assume that they had small confidence in their ability so to do.

[8] Complaint is also made concerning the action of the court in permitting plaintiffs’ amended petition to go to the jury. Whether the pleadings shall go to the jury in any case is within the sound discretion of the trial judge. In this instance that discretion was not abused. Moreover, during the charge to the jury, there was a colloquy between the court and counsel upon this particular subject and counsel for defendant not only did not object to the pleadings being submitted to the jury but requested certain instructions concerning them which were given.

[9, 10] A statute of Ohio (3365-1) requires every railroad company operating a railroad within the state of Ohio to equip its locomotive engines with “some device or contrivance that will most effectually guard against the emission of fire and sparks which would otherwise be thrown out by such engines.” By this statute a much higher degree of care in the prevention of the escape of fire from locomotive engines than that required by the common law is imposed upon all railroad companies operating within the state. Instead of following the exact language of the statute, the trial judge, in his charge upon the question of negligence, instructed the jury that it was the duty of the company to “equip its engines with the most effective apparatus,” to “use the most effectual method known to the business at the time,” to adopt “the most effective method known to the railroad business at the time,” to provide the ^engines “with the most effectual apparatus in use,” to construct the engine “with the most effectual appliances,” and to equip each engine “with the most efficient spark arrester then known,” to guard against the escape of fire or sparks. The terms and language used are strictly synonymous with those contained in the statute and correctly state the statutory rule. Defendant’s criticism thereof is unwarranted. Besides, its request upon this subject was given in substance. ’ /

The judgment will be affirmed, with costs.