Southern Ry. Co. v. Stearns Bros.

28 F.2d 560, 1928 U.S. App. LEXIS 2381
CourtCourt of Appeals for the Fourth Circuit
DecidedOctober 16, 1928
DocketNo. 2741
StatusPublished
Cited by9 cases

This text of 28 F.2d 560 (Southern Ry. Co. v. Stearns Bros.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fourth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Southern Ry. Co. v. Stearns Bros., 28 F.2d 560, 1928 U.S. App. LEXIS 2381 (4th Cir. 1928).

Opinion

PARKER, Circuit Judge.

This was an action at law instituted by Steams Bros., Inc., hereafter called the plaintiff, against the Southern Railway Company, hereafter called defendant, to recover for damage alleged to have been done to an asphalt paving plant of plaintiff located on defendant’s right of way. The complaint alleged that the paving plant was located near the track of defendant at Kings Mountain, N. C., and that while shifting ears nearby defendant’s servants negligently kicked two cars against the plant in such way as to cause considerable damage. The answer, in addition to denying negligence, alleged that the property which was damaged had been placed on the right of way under a lease contract which provided that it should be so placed at the risk of plaintiff, and that defendant should be exempted from liability for damage done thereto, whether same should result from the negligence of defendant or otherwise. There was a finding by the jury that the property was damaged by the negligence of the defendant as alleged, but that defendant was not guilty of gross negligence, and fixing the damages at $4,500. Upon this verdict judgment was entered for plaintiff, and defendant has appealed.

The principal question presented is whether, upon the contract as admitted, a verdict should have been directed for defendant, and, in the view which we take of the ease, this is the only question which we need consider. It appears that the contract in question was executed between the defendant and the Globe Indemnity Company, a corporation which had taken over a road paving contract at Kings Mountain. The indemnity company subsequently entered into a contract with plaintiff to complete the paving which it had taken over, and assigned to plaintiff the contract of lease obtained from defendant. It is stipulated that plaintiff “took over said lease as the assignee thereof, and, at the time of the injury and damage complained of, was occupying the portion of the right of way of the Southern Railway Company in question as the assignee of said lease, being entitled to its rights and privileges, and subject to its obligations, in the same way and manner as if it had been the original lessee named therein.”

The contract of lease provided that, in consideration of an annual rental of $60, defendant gave the right or license “to occupy and use, for the storage of paving materials and machinery,” a certain strip of its right of way at Kings Mountain. It stipulated that the licensee should pay all taxes, licenses, or other charges “upon the business or property conducted, placed, or maintained by the licensee” upon the premises, and contained the following provision, which is the one relied upon by defendant, viz.:

“5. That the licensee accepts the privilege hereby granted with the full knowledge and understanding that any property stored by or with the consent of the licensee upon said right of way is subject to the risk of destruction or damage by fire set out by locomotives operated on the railroad of the railway company, or may be otherwise damaged or destroyed, or may be stolen, and agrees, in consideration of this privilege, that the privilege [562]*562is to be used and enjoyed solely at the risk of the licensee, and that the railway company shall not be responsible to the licensee or others for any such loss, injury, or damage, whether the same results from the negligence of the railway company or otherwise.”

The 'plaintiff erected a concrete miring plant upon the portion of the right of way leased from defendant and was engaged in operating it when it sustained the damage complained of. While admitting the execution of the contract, and that it is bound by the provisions thereof, plaintiff contends that these do not exempt defendant from liability for the damage, contending in the first place that the machinery was being operated, and was not “stored,” within the meaning of the exempting clause of the contract; and, in the second place, that the exemption from liability extends only to damage caused by fire. We think, however, that neither of these positions is sound and that upon the admitted facts verdict should have been directed for defendant.

It is well settled that a railroad company cannot contract against liability for its negligence with respect to the performance of its duty as a common carrier. This rule has no application, however, to contracts by which it leases portions of its right of way for uses not connected with the discharge of its duty as such carrier. The public has no interest in such contracts, and a provision that the railroad is not to be held liable for negligence resulting in damage to property placed upon the leased premises is not void as- being contrary to public policy. This is the holding not only of the federal courts, but also of the courts of North Carolina, by whose public policy the validity of the contract is to be governed. Slocumb v. Raleigh, etc., Ry. Co., 165 N. C. 338, 81 S. E. 335; Godfrey v. Western Carolina Power Co., 190 N. C. 24, 128 S. E. 485; Hartford Fire Ins. Co. v. Chicago, etc., R. Co., 175 U. S. 91, 20 S. Ct. 33, 44 L. Ed. 84; Santa Fé, etc., R. Co. v. Grant Brothers, 228 U. S. 177, 33 S. Ct. 474, 57 L. Ed. 787.

We are not impressed with the argument that the exemption from liability does not apply because the machinery damaged was being operated, instead of being merely “stored,” on the property. The contract must be construed as a whole, and in the light of the purpose for which it was made; and, when so construed, there can be no doubt that the intention of the parties was that the land leased should be used for the purpose for which it was being used at the time of the occurrence complained of, and that defendant should not be held liable for damage done to property of plaintiff placed thereon under the contract, even though such damage should be caused by the negligence of defendant.

It is perfectly clear that the word “stored” was not used in the contract in the limited and technical sense of being “kept for safe custody.” The lessee had a paving contract on its hands. It desired a place where it could set up its machinery for mixing paving material near the road to be paved and near the track of the railroad which would haul in the material. A place for mere “storage” was not what was needed, and furthermore an open lot manifestly would not have been selected for the “storage” of machinery. That “storage” in the strict sense was not what was contemplated appears, also, from the provision of the contract which required that the lessee pay all taxes, licenses, or other charges upon the business or property “conducted, placed, or maintained” upon the leased premises. And, if further proof were needed that the word “storage” was not used in the contract in any limited or technical sense, it is found in the interpretation- which the parties themselves placed upon the contract, the plaintiff in setting up and operating its machinery upon the premises, and the defendant in allowing this to be done.

But, even if it were held that the contract contemplated mere “storage,” we do not see that plaintiff’s position would be helped thereby.

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Cite This Page — Counsel Stack

Bluebook (online)
28 F.2d 560, 1928 U.S. App. LEXIS 2381, Counsel Stack Legal Research, https://law.counselstack.com/opinion/southern-ry-co-v-stearns-bros-ca4-1928.