Chicago, Indianapolis & Louisville Railway Co. v. Southern Indiana Railway Co.

70 N.E. 843, 38 Ind. App. 234, 1904 Ind. App. LEXIS 274
CourtIndiana Court of Appeals
DecidedApril 6, 1904
DocketNo. 4,615
StatusPublished
Cited by12 cases

This text of 70 N.E. 843 (Chicago, Indianapolis & Louisville Railway Co. v. Southern Indiana Railway Co.) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chicago, Indianapolis & Louisville Railway Co. v. Southern Indiana Railway Co., 70 N.E. 843, 38 Ind. App. 234, 1904 Ind. App. LEXIS 274 (Ind. Ct. App. 1904).

Opinions

Roby, J.

Demurrers were sustained to each of the three paragraphs of appellant’s complaint, and the correctness of such action is the question for decision.

A written contract, executed by the Louisville, New Albany & Chicago Eailway Company, as the party of the first part, and by the Evansville & Eichmond Eailway Company, as party of the second part, is filed with each paragraph and forms the basis for the relief prayed, which in the first and second paragraphs is specific performance of the contract, and in the third, judgment for the reasonable cost of constructing the interlocking switch specified therein. The averments are made that appellant succeeded to the rights of the Louisville, New Albany & Chicago Eailway Company, and that appellee holds the title of the [236]*236Evansville & Richmond Railway Company, and that the one has the right to enforce, and the other is hound hy, the contract in question. This is not controverted, so that the rights of the parties will not he different from what they would be had the agreement between them been originally, and the terms “first party” and “second party,” when used in this opinion, will be used as applicable to appellant and appellee respectively.

The contract made on July 29, 1889, in terms grants to the second party the right to construct and operate its railroad over and across the main track and switches owned by the first party, at a designated distance north of the Bedford telegraph office, upon certain specified conditions, which the .second party bound itself to perform. The substance of these conditions was that the second party should furnish all material and perform all labor necessary to raise a certain switch track belonging to the first party, to furnish all material and perform all labor incident to the construction and maintenance of the crossing, including an interlocking switch and signal system. In event that the first party should thereafter wish to construct additional tracks, it agreed to adopt its own tracks thereto and pay one-half of the expense of whatever else (frogs, signals, etc.) might be necessary to make the crossing safe. It was further stipulated that proper appliances were to be used in such improvement, and that employes performing service at said crossing should be subject to removal at the demand of the first party. The second party bound itself- to hold the first party harmless from cost and damage resulting from the construction or the use of said crossing. The concluding clausés of the contract were of the tenor following :

“Sixth. The second party agrees not to run any track or tracks to or from any stone-quarry which is connected with the road of the first party, by switches or tracks built thereto by said first party or under contract therefor, and will not make any demands for [237]*237the use of said first party’s tracks or switches leading to any such quarries, for the shipment of stone therefrom, the express purpose of this clause being to preserve to said first party all rights and benefits now acquired in the business of such quarries; and it is hereby expressly understood and agreed that the consideration for granting the rights and privileges herein expressed to said second party is the covenant and agreement of said second party not in any manner, directly or indirectly, to interfere with or divert the benefits now derived or to be hereafter derived from said first party’s connection and business with such quarries.
Seventh. In consideration of making a Y connection, it is agreed between the parties hereto that in case any party or parties require said first party to forward stone or other car-load freight to the line of the second company, it is agreed that the proportion of the through rate from any given quarry or station accruing to the party of the first part shall not be less than three cents per hundred pounds.”

By clause sixth the second party agreed not to run any track into any stone-quarry connected by switches or tracks with the road of the first party, and not to demand the use of such tracks for the shipment of stone; “the express purpose of this clause being to preserve to said first party all rights and benefits now acquired in the business of such quarries.” The concluding portion of the clause contains a further agreement by the second party not “directly or indirectly to interfere with or divert the benefits now derived or to be hereafter derived from said first party’s connection and business with such quarries.” This clause clearly states the purpose for which it is drawn. Its effect, and its intended effect, is to deprive a class of citizens, engaged in a certain business, of advantages that might accrue to them from the facilities afforded them for the shipment of their merchandise over a competing railroad.

[238]*2381. [237]*237By this agreement the two railroad companies undertook to contract away the rights of third parties, without their [238]*238knowledge, and in defiance of the public duty devolved upon such companies. That tbe contracting parties were conscious of tbe quality of such undertaking is indicated by tbe seventh clause of the contract, where, in case “any party or parties require said first party to forward stone * * * to the line of the second party,” then irrespective of distance, at least three cents per hundred pounds must be paid first party for its share of the through rate; a stipulation, the effect of which is to deprive the shipper of the benefits of competition, should he demand that the second party discharge its public duty by furnishing transportation facilities to him. The policy of the law is to prevent the- creation of monopolies and to foster fair competition. Eel River R. Co. v. State, ex rel. (1900), 155 Ind. 433; Indianapolis Union R. Co. v. Dohn (1899), 153 Ind. 10, 45 L. R. A. 427, 74 Am. St. 274; State, ex rel., v. Portland Nat. Gas Co. (1899), 153 Ind. 483, 53 L. R. A. 413, 74 Am. St. 314; Board, etc., v. LaFayette, etc., R. Co. (1875), 50 Ind. 85; 2 Elliott, Railroads, §359.

2. “A contract between corporations charged with a public duty,- such as that of common carriers, providing for the formation of a combination having no other purpose than that of stilling competition, and providing means to accomplish that object, is illegal. The purpose to break down competition poisons the whole contract, and there is here no antidote which will rescue it from legal death.” Cleveland, etc., R. Co. v. Closser (1890), 126 Ind. 348, 361, 9 L. R. A. 754, 22 Am. St. 593. The important thing to be secured was, the court declared in the case above cited, a sound and salutary general principle, and not merely cases with closely resembling facts. The principle declared, as heretofore quoted, accords with the necessities of commerce and development, and is supported by a vast volume of authority, including the following: Louisville, etc., R. Co. v. Sumner (1886), [239]*239106 Ind. 55, 59, 55 Am. Rep. 719; St. Louis, etc., R. Co. v. Mathers (1874), 71 Ill. 592, 22 Am. Rep. 122; Greenhood, Public Policy, p. 626; Kettle River R. Co. v. Eastern R. Co. (1889), 41 Minn. 461, 43 N. W. 469, 6 L. R. A. 111; West Va. Trans. Co. v. Ohio River, etc., Co. (1883), 22 W. Va. 600, 626, 46 Am. Rep. 527.

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Cite This Page — Counsel Stack

Bluebook (online)
70 N.E. 843, 38 Ind. App. 234, 1904 Ind. App. LEXIS 274, Counsel Stack Legal Research, https://law.counselstack.com/opinion/chicago-indianapolis-louisville-railway-co-v-southern-indiana-railway-indctapp-1904.