Central Law Journal.

ST. LOUIS, MO., JUNE 4, 1920

CARRIER'S LIABILITY FOR NOT SUPPLYING CARS.

The coal companies served by the Chesapeake & Ohio Railroad Company are threatening suits to recover damages for losses sustained through an inadequate car supply, wherein an interesting legal controversy with important ramifications may arise. The C. & O. case is differentiated from that of other carriers for the reason stated that "it followed the policy of increasing the burden upon it by constantly adding new coal territory without adding additional cars in spite of the fact that it was unable to serve the territory already developed," that "this was done to prevent the entrance of rival carriers into territory capable of being reached by the C. & O. Railroad." If this allegation can be proved a novel case will arise.

The particular incident is interesting, however, as furnishing an opportunity for fixing a liability for losses falling upon industry through an inadequate car supply about which there has been much discussion in the public print. There will be two issues, viz. First, when a carrier fails to supply itself with sufficient cars in normal times and to meet normal demands, does it become liable in damages in abnormal times for all or a proportionate share of the injuries suffered by industry through enforced idleness? Secondly, may the industry recover this damage for breach of contract, for failure to perform a common law duty or for failure to meet a statutory requirement? This, of course, involves the effect of the several acts to regulate commerce and the several amendments thereto. Leaving aside the "Railroad Act of 1920" which virtually puts car service at the command of the Interstate Commerce Commis

sion, the most directly applicable one is as follows:

*** and the term transporSec. 1: tation shall include cars and other vehicles and all instrumentalities and facilities of shipment or carriage ***; and it shall be the duty of every carrier subject to the provisions of this act to provide and furnish such transportation upon reasonable request therefor." Chap. 3501, 34 Stat. at L. 584, Comp. Stat. 1914, Sec. 8563.

The U. S. Supreme Court in Pennsylvania R. Co. v. Sonman, 242 U. S. 188, 61 L. ed. 188 (1916), held that "it is plain that supplying the requisite cars was an essential step in the intended movement of the coal and a part of the commerce *** to which that movement belonged." It was expressly held that the act did not abridge the right to redress for failure to supply requisite cars and that suit might be brought in a state Court. The injured person would be required to elect between two remediesto make complaint to the Interstate Commerce Commission or to bring an action for damages in a Court, but could not do both." It was held that "such appropriate common law and statutory remedies as can be enforced consistently with the scheme and purpose of the act are not abrogated or displaced; that the act does not supersede the jurisdiction of state Courts in any case, new or old, where the decision does not involve the determination of matters calling for the exercise of the administrative power and discretion of the Interstate Commerce Commission or relate to a subject as to which the jurisdiction of the federal Courts is otherwise made exclusive."

When the jurisdiction of the Interstate Commerce Commission is not exclusive is defined as follows:

"Claims for damages arising out of the application, in interstate commerce, of rules for distributing cars in times of shortage, call for the exercise of the administrative authority of the Commission where the rule is assailed as unjustly discriminatory, but where the assault is not against the rule, but against its unequal and discriminatory

application, no administrative question is presented and the claim may be prosecuted in a federal or state Court without any precedent action by the Commission." See also Penn. R. Co. v. Puritan Co., 237 U. S. 121, 129; 59 Led. 867, 872.

"If no administrative question be involved, as well may be the case, a claim for damages for failing upon reasonable request to furnish to a shipper in interstate commerce a sufficient number of cars to satisfy his needs may be enforced in either a federal or state Court without any preliminary finding by the Commission, and this whether the carrier's default was a violation of its common law duty, existing prior to the Hepburn Act of 1906, or of the duty prescribed by that act," which act was quoted at the outset. In so many words the Court held that the Hepburn Act "may be regarded as merely adopting the common law rule," This sentence sufficiently clears the atmosphere.

The carrier's most probable defense will be that the times are not normal. From his allegations the shipper no doubt intends to counter with the claim that the carrier did not supply itself with sufficient cars to meet the reasonable demands of normal times. Conceding for the moment that the times have been made abnormal through governmental interference, the case would manifestly turn upon the past failure to supply sufficient cars for the territory served, and that the offense and the injury of which complaint is made is a continuing one, finding its origin back in normal times. In other words, the carrier would not be permitted to go scot-free but would be held for the injury occasioned by its past failure of duty continuing into the present, if not for injury directly traceable to abnormal demands. This would call for a decision upon the right of a carrier to extend its lines and thereby take on new and additional burdens of service without making a proportionate increase in its "vehicles and all instrumentalities and facilities of shipment or carriage."

The determination of this issue will be aided by the judicial views expressed in Penn. R. Co. v. Sonman Co. (Supra, p. 123-5), although the facts differed materially. It was conceded in that case that "the times were normal," and the jury found that the carrier had a generally ample car supply for the needs of the coal traffic under normal conditions, and the jury further found that the conditions in the coal trade being normal, as just shown, the number of cars to which the coal company was entitled was to be measured by its reasonable requests based upon its actual needs."

The Railroad Company defended by setting up its "car distribution rules," but the Court held that "it was only in times of car shortage resulting from unusual demands or other abnormal conditions, not reasonably to have been foreseen, that car distribution rules originating with the carrier can be regarded as qualifying or affecting the right of a shipper to demand and to receive cars commensurate in number with his needs." It will be observed that the attack on the distribution rules was not as to their reasonableness, for that would have been a question for the Interstate Commerce Commission, but on the failure to supply "vehicles and all instrumentalities and facilities of shipment" by whatever rules administered, and that the rules could not be pleaded as a defense.

If it be conceded that the present abnormal demand for cars is such that it "could not reasonably have been foreseen" then the C. & O. case would seem to have to turn on the past failure of the carrier to supply sufficient cars for normal times and that the injury does not arise wholly from abnormal conditions, but is only aggravated thereby. It will prove a nice question and opens a wide field for speculation on a question agitating every shipper.

THOMAS W. SHELTON.

CONSTITUTIONALITY OF MORATORIUM LAWS.-South Dakota, in company with many other states during the war with Germany, passed moratorium laws, the aim of which was to prevent those who enlisted in the armed forces of the United States from being deprived of their legal rights without opportunity to take the proper steps to conserve such rights. But South Dakota went further than most states and passed a law which, instead of merely preserving the remedies of the enlisted man, released him from the obligation of the contract into which he had entered. Section 1 of the Moratorium law of South Dakota exemps the beneficiaries under such law, until one year after the termination of the war or of service therein from any obligation to pay moneys due on any contract except life insurance policies. Section 2 provides that "the enforcement of any right of entry which may hereafter arise during the continuance of the present war shall be suspended or stayed" during the period above mentioned.

The Supreme Court of South Dakota, in the recent case of Granger v. Luther, 176 N. W. 1019, held this act to be unconstitutional on the ground that instead of affecting the remedy it destroyed the obligation of contracts entered into by enlisted men. In the case under consideration the plaintiff, who afterwards enlisted in the army, was in possession of a lease, a provision in which gave the landlord a right to re-enter and take possession on nonpayment of the rent. After plaintiff had gone into the army and had defaulted in his rent the landlord took possession of the premises and subsequently sold the property to the defendant. On his return from the war plaintiff brought suit to recover the possession of the premises under his lease. In reversing a judgment nisi in favor of the plaintiff the Supreme Court said:

"We are of the opinion, in view of the remainder of section 2, that the above provision as to enforcement of 'right of entry' relates only to enforcement by action and therefore pertains only to legal proceedings brought against the beneficiary under such law. We therefore think it has no application to the facts of this case. But if we were to hold that it denied to a party the contracted right of entry-the only ground upon which respondent can deny appellant's right of possession of said land-then we are presented with the question as to whether the provisions of sections 1 and 2 above referred to impair the obligation of

"That they do impair the obligation of this contract is perfectly apparent. As said by the court in Edmondson v. Ferguson (supra):

"If the General Assembly were to pass an act declaring that a contract for the payment of any stipulated sum of money within one year should not be due and payable for five years, it would be readily seen that the obligation of the contract was impaired-the contract would be lessened in value.'

"Here, by section 1, our lawmakers have attempted to extend the time for payment of money due under contract. If A enters into a contract whereby he leases land to B, B's right of entry to come into existence and the term of the lease to commence upon a certain date, any law that would take from B the right to enter on said land or defer the exercise of such right impairs A's obligation under such contract and thereby diminishes the value of such contract to B. Here, upon the happening of either one or two events, the lessor or his grantee had, under the contract entered upon and taken possession of said premises. Both events happened; respondent defaulted in payment of rent, and the lessor sold the premises."

It is to be observed that most of the Moratorium laws passed during the Civil War merely suspended the right to sue or issue process against one in the military service of the United States. Edmondson v. Ferguson, 11 Mo. 344; Johnson v. Higgins, 3 Metc. (Ky.) 556; Coxe's Executor v. Martin, 44 Pa. 322; McCormick v. Rusch, 15 Iowa, 127. It is also well to observe that a state of war does not justify a breach of constitutional rights. The obligation of a contract cannot be impaired, although the legal remedy thereon may be deferred. Recent decisions on the Moratorium laws recently enacted disclose the fact that the courts are careful to find as a fact that the purpose and effect of such laws is merely to suspend the ordinary legal remedies. Thress v. Zemple, 174 N. W. (N. D.) 85; Konkel v. State, 168 Wis. 335; Pierrard v. Hoch (Ore.) 184 Pac. 494.

LIABILITY OF MASTER WHO LENDS HIS SERVANT TO ANOTHER FOR THE NEGLIGENCE OF SUCH SERVANT.-The cases in America and England are difficult to reconcile or to distinguish on the question of which master is liable when one lends a servant to the other. In the recent English case of Paulson v. Jarvis & Co., 122 L. T. Rep. 471 (Decided Dec. 17, 1919, by the Court of Appeals) it was held that the master who lends a team and driver to another is liable for the driver's negligence.

In the Poulson case it appeared that defendants Jarvis & Co., team owners and haulers, received an order from the Ministry of Muni tions to send a team and driver to haul wagons which were being loaded at one of the Liverpool docks. The defendant sent a team and a man, Davies, who was directed to report to the agent of the Minister of Munitions and use the team in hauling wagons which were being loaded by said agent. Defendants testified that they had no control over their servant after he reported to the Minister of Munitions; that when they control a job, they usually send a foreman to direct their men. Nevertheless, the Court of Appeals held that Jarvis & Co. and not the Ministry of Munitions was liable for the negligence of Davies in injuring the plaintiff. The sole question on appeal was whether the superior who should respond for the negligent conduct of Davies was Jarvis & Co. or the Ministry of Munitions. In deciding that the foremen were liable, Lord Sterndale, M. R., said:

"I think that on this evidence, apart from authority, it was competent for the learned judge in the court below to come to the conclusion at which he did. As I have pointed out, as is so often the case, neither the Minister of Munitions nor the defendants in any way interfered with Davies except that the representative of the Minister of Munitions told him when the wagon was filled to take it outside away from the road traffic. There is nothing to show that it was contemplated by either party to the agreement that the representative of the Minister of Munitions should interfere with Davies in the management of his masters' horses, or that he ever attempted to do so, and I do not think the defendants would ever have allowed him to do so."

The learned Master of the Rolls discussed several leading English cases the conclusions in which indicate the difficulty in exactly defining the rule in this class of cases. The principal case on which defendants relied and which the Court found difficult in distinguishing was that of Donovan v. Laing, 68 L. T. Rep. 512 (1893), Q. B. 629. In this case the defendants supplied to another firm a crane and a man to work it in loading and unloading vessels. The working of the crane was directed by the hirers in the sense that their men gave the directions when to raise and lower the goods, and when to swing the arm of the crane. It was held that the defendants were not liable for the acts of the crane man, because he was for the time the servant of the hirer.

On the other hand, in McCartan v. Belfast Harbour Commissioners (1910), 2 Ir. Rep. 470;

(1911) 2 Ir. Rep. 143, the master of a vessel hired a crane worked by a man in the employment of the defendants to discharge his vessel. The man received the same directions as in Donovan v. Wharton (ubi sup.). It was held in the Court of Session and in the House of Lords that the defendants were liable, as the crane man was in their service, and not in that of the master or owners of the vessel.

The rule in the so-called carriage casesQuarman v. Burnett, 6 M. & W. 499 and Jones v. Corporation of Liverpool, 14 Q. B. Dir. 890is well known and generally accepted to-wit: that one who hires a carriage and driver from a liveryman is not liable for the driver's negligence. These cases are unusually distinguished on the ground that the hirer is a passenger rather than an employer and has no control over the driver. It is interesting, however, to note the argument of Lord Dunedin on the McCartan case (supra) in which he professes to see no distinction in principle between those cases and the cases where a master lends a servant and a crane to another. He said:

"Take the case of the hire of a carriage from a jobmaster. The hirer can tell the coachman 'to go on, to stop, to go to a certain place.' He can tell him to drive slower or faster within certain limits. All this control of the servant has been surrendered and transferred by the 'general' master, the jobmaster. But he cannot tell the coachman to drive at a speed which involves danger to the horses or the carriage; he cannot tell him to leave the box and allow the horses to be driven by the hirer himself or someone else of his selection. So here the hirer could tell the crane-man to lower or raise or move the crane alongside; he could not tell him to put a weight on the crane more than it would bear, or to drive it so fast as to endanger the machinery; or to descend from the crane, and let the hirer or one of his men work the crane instead of him. What difference in quality is there between these two sets of allowable and unallowable acts; I confess I see none, and the learned counsel for the appellants were utterly unable to suggest any."

In Dewar v. Tasker (23 Times L. Rep. 259), an engine was hired from the defendants by a company to do the hirers' work. The engine was worked by a man in the defendants' service, but was put at the disposal of the hirers, the Subsoil Company, and the defendants in fact exercised no control over the man or engine while working for the hirers, and did not know where it went or what it carried. The defendants were held liable on the ground that the man was acting as their servant, and not as the servant of the hirers.

CONSTITUTION.

Attacks on the Constitution.-Typical of the Socialist and I. W. W. assaults on Americanism are their attempts to overthrow the confidence the American people have enjoyed in their Constitution, and the faith we have had in Washington, Jefferson, Hamilton, and the other men who steered the thirteen colonies out of the maze of confusion existing after the Revolutionary War. They established a government which has borne the brunt of many an assault and attempt at overthrow, downing the forces of sedition and establishing a strong national government, capable of dealing with national problems, yet without discarding the principle of "local selfgovernment" brought to this country by the Pilgrims.

We are today told that the Constitution is a document of infamy, designed to suppress the many for the advantage of the few. Men, such as the notorious Allen S. Broms, sometimes openly and sometimes. covertly attempt to thrust the dagger of distrust into the hearts of Americans. Nor do they indulge only in generalities; thanks to the writings of some of our scholars and university investigators they are able to quote from these sources. For instance, on Sunday, December 7, 1919, Broms quoted copiously from Charles A. Beard, leaving in the minds of his hearers the conclusion that the Constitution was framed by grafters and thieves and has beeen used to destroy real democracy.

Let us examine some of the particular claims made by these agitators and see just how much truth they contain. The acid test of facts must be applied-here goes!

Was It Framed by Reactionaries?-It is frequentiy stated that the Constitution was framed by reactionaries, men entirely out of touch with the spirit of the men who had fathered and fostered our war for free

C. A. Beard2 are typical. An examination of their books shows that (1) the Revolution is regarded as an expression of democratic thought, and (2) that the Federal Constitution represents a return to power of "the solid, conservative, commercial and financial interests of the country." (Beard, p. 75.)

What test can we apply? Can we not say that the opinions of the signers of the Declaration of Independence on the adoption of the new Constitution, would strongly indicate whether or not that document was really "reactionary ?"

The writings of both Smith and Beard. would lead us to believe that a majority of the "signers" opposed the Constitution. "The Federal Convention assembled in Philadelphia only eleven years after the Declaration of Independence was signed, yet only six of the fifty-six men who signed that document were among its members." (Smith, p. 33.)

A large majority of the "signers," as a matter of fact, favored the Constitution.3 The claim, let us remember, is that the Constitution is a reactionary document and that this is evidenced by the fact that its framers were not in sympathy with the views. of the men who had encouraged our war with England, the latter class being adequately represented by those who had the nerve to sign the Declaration of Independ

ence.

Careful investigation has disclosed the following facts as to the attitude of the "signers" on the adoption of the Constitution: Twenty-five favored and only eight opposed it. The views of the other nine (fourteen were dead) are unknown, though probably three would have been inclined

(1) Spirit of American Government.

(2) The Supreme Court and the Constitution. (3) For detailed proof see the author's article in the Central Law Journal, Dec. 7, 1917.