183 F.2d 548 (4th Cir. 1950), 6110, Sainsbury v. Pennsylvania Greyhound Lines, Inc.

Docket Nº:6110.
Citation:183 F.2d 548
Case Date:August 10, 1950
Court:United States Courts of Appeals, Court of Appeals for the Fourth Circuit

Page 548

183 F.2d 548 (4th Cir. 1950)




No. 6110.

United States Court of Appeals, Fourth Circuit.

August 10, 1950

Argued July 5, 1950.

Page 549

George B. Woelfel, Annapolis, Md., and Melvin J. Sykes, Baltimore, Md. (Paul Berman, Sigmund Levin, Baltimore, Md., and Thomas J. Curley, Jr., Annapolis, Md., on brief), for appellant.

F. Gray Goudy, Baltimore, Md. (H. Beale Rollins, Baltimore, Md. on brief), for appellee.

Before PARKER, Chief Judge, SOPER and DOBIE, Circuit Judges.

DOBIE, Circuit Judge.

This civil action was instituted in the Circuit Court for Baltimore County, Maryland, by Joseph C. Sainsbury, a boatswain's mate, third class, in the United States Navy. The case was properly removed on the ground of diversity of citizenship to the United States District Court for the District of Maryland by the defendant, Pennsylvania Greyhound Lines, Inc. The District Court, sitting without a jury, entered judgment for the defendant and plaintiff has duly appealed.

On June 24, 1949, plaintiff was injured, allegedly due to the negligence of defendant or its agent, when a bus, owned and operated by defendant and on which plaintiff was a passenger, ran off the road and struck an embankment. Plaintiff suffered serious injury as a result of the accident- eight broken ribs, a fracture of the leg and additional minor injuries.

After the accident, which occurred near White Marsh, Maryland, plaintiff was removed to the Johns Hopkins Hospital in Baltimore for first aid treatment, but because of crowded conditions there he had to be taken to a downtown hotel. After some hours at the hotel he went to the United States Marine Hospital and, less than a day later, he was transferred to the Naval Hospital at Annapolis, where he was confined for more than three months. Plaintiff was twenty-three years of age at the time of the accident and had received the equivalent of a high school education.

The claims adjuster for the defendant, T. Benjamin Weston, paid for the treatment given plaintiff at Johns Hopkins Hospital, for ambulance services and for the hotel accommodations which he had procured for the plaintiff. Weston visited the plaintiff once four or five days after the accident and again on July 16, 1949, when he

Page 550

was accompanied by his friend, a Mr. Smith. Weston was an attorney-at-law and this fact was known to the plaintiff.

We quote from the District Court's opinion, as follows:

'On this second visit this representative of defendant (Weston) asked plaintiff whether he had considered settling his claim for injuries with the defendant and what he would be willing to accept in full settlement. Plaintiff replied that he had not reached any conclusion in the matter, stating that he wanted to speak first to the legal representative of the Navy or to some other lawyer, but asked the claims adjuster what he thought would be a fair settlement, to which the latter replied that he thought $500.00 would be just and reasonable. Plaintiff thereupon said that he understood persons with similar injuries had obtained larger compensation, to which the claims adjuster rejoined that such was true but only in cases of non-service persons, stating that those in the service, like the plaintiff, were in a different situation in the eyes of the law because they obtained from the Government, free of charge, medical and hospital care and also were entitled to disability payments in the event of injury, so that in his present case, he would be entitled to recover from the defendant on account only of the pain that he may have suffered as a result of his injuries.

'After some further discussion, during which plaintiff explained- which the claims adjuster did not deny- that the Navy doctors had told him, the plaintiff, that full recovery from his knee injury was problematical and that an operation might be necessary, plaintiff agreed to accept the claims adjustor's proposal.'

Plaintiff testified that Weston told him there was no need of seeing another lawyer or legal officer because that would not do any good for $500.00 was about the maximum he could hope to recover under the circumstances. Defendant, because of the testimony of Smith and Weston, argues that no discussion as to lawyers or permanent disability took place; but the previous quotation from the District Judge's opinion and his statement at the end of his opinion that he gave 'more credence to plaintiff's than to Weston's version of the entire conversation leading up to the execution of the release' is a complete answer to defendant's contention.

Plaintiff executed a release of any claim for injuries received in the accident in reliance upon Weston's representations and in consideration therefor was presented with a check for $500. Plaintiff, after talking with various persons in the Naval Hospital, subsequently decided that he was entitled to more than $500 as compensation for his injuries. He returned the check without endorsement but defendant refused to accept it. After consultation with an attorney, the present suit for damages sustained in the accident was instituted by plaintiff. Defendant claims that the release executed by plaintiff precludes him from prosecuting this litigation. Plaintiff, however, contends that this release was obtained by fraud and is therefore invalid because Weston misrepresented plaintiff's legal rights.

The representation by Weston to plaintiff that because he was in the service he could recover only for pain and suffering was a false statement of the law. It is generally well settled that the fact that the plaintiff may receive compensation from a collateral source (or free medical care) is no defense to an action for damages against the person causing the injury. See Standard Oil Co. of California v. U.S., 9 Cir., 153 F.2d 958, 963, affirmed 332 U.S. 301, 67 S.Ct. 1604, 91 L.Ed. 2067, and the cases therein cited; note, 22 A.L.R. 1558; note, 18 A.L.R. 678-683; McCormick, Damages, 310 note 2, and 324 (1935); 15 American Jurisprudence, Damages §§ 78, 200-201; Restatement, Torts, Sec. 920, Comment e. It is inconceivable that any member of the bar could have made a statement such as the one made by Weston without knowledge of its falsity or without acting with a reckless disregard for the truth.

The rule is also well established that when a lawyer makes a misrepresentation of law to a layman relief may be afforded,

Page 551

even though the layman knows the lawyer represents an antagonistic interest. Any other rule would be unconscionable. See Rusch v. Wald, 202 Wis. 462, 464, 232 N.W. 875; Restatement, Torts, Sec. 545, Comment d; 23 American Jurisprudence, Fraud and Deceit, § 48; Prosser, Torts, 761 note 81 (1941), 5 Williston, Contracts, §§ 1487, 1495 and note 4 (1937).


To continue reading