Doniphan, Kensett & Searcy Railroad v. Missouri & North Arkansas Railroad

149 S.W. 60, 104 Ark. 475, 1912 Ark. LEXIS 273
CourtSupreme Court of Arkansas
DecidedJuly 1, 1912
StatusPublished
Cited by12 cases

This text of 149 S.W. 60 (Doniphan, Kensett & Searcy Railroad v. Missouri & North Arkansas Railroad) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Doniphan, Kensett & Searcy Railroad v. Missouri & North Arkansas Railroad, 149 S.W. 60, 104 Ark. 475, 1912 Ark. LEXIS 273 (Ark. 1912).

Opinion

Frauenthal, J.

This is an action instituted by the appellee to enjoin the appellant from proceeding to arbitrate a matter of dispute in reference to a certain traffic contract entered into and executed by both parties, and to reform said contract. Both parties are railroad corporations, organized under the laws of the State of Arkansas. Appellee owns and operates a line of railroad extending through White, Cleburne and other counties of the State, and the appellant owns and operates a railroad extending from Doniphan to Searcy, a distance of about six miles, where it connects with the main line of appellee’s railroad, and also a spur line extending from appellee’s main line at or near Letona out for a distance of eight or ten miles in Cleburne County. The principal corporators of the appellant company are also the principal corporators of a corporation known as the Doniphan Lumber Company, which operates a mill at Doniphan, and owns large bodies of timber lands _ situated chiefly in Cleburne County.

The principal property carried by the appellant over its line of railroad is pine logs, which it transports from the said timber lands in Cleburne County to the mill at Doniphan, where it is manufactured into the finished product, which is shipped out over its line. The appellant also carries over its railroad merchandise and supplies both to Doniphan and to points on its spur line extending out from Letona, where camps are located in cutting the timber.

On June 6, 1910, the parties, to this suit entered into a written contract by which appellee granted to appellant certain trackage rights over its line of railroad. The provisions of said contract which we think are material in determining the questions involved in this case are as follows:

“Article 1. The Arkansas Company (appellee) hereby grants to the Doniphan Company (appellant) for a period of ten years from and after January 1, 1911, the joint and equal use, in common with the Arkansas Company and such other company or companies as the Arkansas Company shall at any time permit to use the same or any part thereof, and, subject to the conditions, limitations and restrictions in this contract set forth, of the main line and passing tracks of said railroad between the present connection of the tracks of the Arkansas Company and the Doniphan Company at the town of Searcy, White County, Arkansas, and a point three miles north of the water tank at Snell, as now located, in the county of Cleburne. * * *”
“Article 2. The Doniphan Company covenants and agrees to pay to the Arkansas Company * * * for the rights and privileges herein granted the sum of one dollar per mile for each and every mile its trains move over the tracks of the Arkansas Company. * * *”
“Article 4. The Doniphan Company will handle no traffic, whether passenger, freight, mail and express, or of any' other character, to or from Searcy or the aforesaid point three miles north of water tank at Snell, or to or from any point between Searcy and the aforesaid point three miles north of water tank at Snell, except pine logs for manufacture at Doniphan, Arkansas; but, if legally compelled to do so, they shall pay to the Arkansas Company sixty per cent, of the Arkansas Company's local rate applying thereon. * * *”
“Article 5. The Doniphan Company hereby assumes all risk of all loss, damage or injury which shall in any manner occur in or upon any track the use of which is hereby granted, whether to the property of the Doniphan Company or to the property in its custody, or to its passengers or to its employees or to third persons, or to the property of third persons, shall there suffer by reason of the movement of any engine, car or train of the Doniphan Company, in all respects as if the Doniphan Company had then been in the exclusive' use and control of such track. * * *”

There was also a provision in the contract providing for an arbitration in event any disagreement arose between the parties concerning the construction of any part of the agreement or the business or manner of transacting same.

In proceeding under this contract, a disagreement arose between the parties as to the kind of traffic which appellant was entitled to carry over the appellee’s tracks and the compensation which should be paid therefor. The appellee contended that at the time said contract was executed it was intended and agreed that the trackage rights granted were limited and restricted to a certain class or character of traffic, towit, pine logs, and that this portion of the agreement was incorporated in the above article 4. The appellant, however, contended that under the terms of said contract it was not limited or restricted in the kind or class of traffic that it might handle over appellee’s rails, except as to such traffic originating or terminating on appellee’s line of railroad at or between the points named in said article 4. It claimed that it could transport over appellee’s line any class or character of traffic which originated on its own line of railroad, for example, at Doniphan, or at the terminus of the spur extending out from Letona, and that for such traffic it was under obligation to pay only one dollar per mile for each mile its trains ran over the appellee’s tracks, as provided in the contract. Thereupon, appellant gave notice to appellee that it desired to arbitrate the question of the construction of the contract in this particular, under the terms of the contract providing therefor, and selected its arbitrator. The appellee then instituted this suit, seeking to enjoin said arbitration, and to reform the contract if it does not express the intent and agreement as contended for by it.

In its original complaint, appellee based its right to a reformation of the contract upon the ground that a mutual mistake had been made by the parties in the employment of language to express the intent and agreement. After all the testimony had been taken in the case, the appellee filed an amendment , to its complaint in which it based its right to reformation upon the further alleged ground that the appellant, by inequitable conduct and fraudulent concealment of its interpretation or construction of the contract, induced appellee to execute it under a mistaken belief as to its meaning in this particular.

Upon the filing of the complaint, the chancellor issued a temporary injunction restraining the appellant from prosecuting the arbitration; and, on final hearing of the cas'e, the court entered a decree reforming said contract so as to authorize appellant to handle in its trains operated over appellee’s line of railroad pine logs, and no other traffic, and making perpetual the temporary restraining order.

Before considering the question as to whether or not the contract should be reformed, we think it necessary to determine whether or not the contract as written restricts and limits the kind and character of traffic to be handled by appellant over the appellee’s rails to pine logs, no matter where such traffic may originate; for, if it does, then the decree of the chancellor would not be prejudicial to appellant, even though appellee was not entitled to the reformation, because, as reformed by the chancellor, the contract would simply express in more explicit language the agreement which the contract as written really makes.

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Cite This Page — Counsel Stack

Bluebook (online)
149 S.W. 60, 104 Ark. 475, 1912 Ark. LEXIS 273, Counsel Stack Legal Research, https://law.counselstack.com/opinion/doniphan-kensett-searcy-railroad-v-missouri-north-arkansas-railroad-ark-1912.