State v. The St. Louis & San Francisco Railway Company

• Citation: 28 S.W. 1074,125 Mo. 596
• Parties: The State, Appellant, v. The St. Louis & San Francisco Railway Company
• Decision Date: 22 December 1894
• Court: United States State Supreme Court of Missouri

28 S.W. 1074

125 Mo. 596

The State, Appellant, v. The St. Louis & San Francisco Railway Company

Supreme Court of Missouri, First Division

December 22, 1894

Appeal from St. Louis City Circuit Court. -- Hon. James E. Withrow Judge.

Affirmed.

R. F Walker, Attorney General, and James O. Broadhead for appellant.

(1) A party for whose benefit a stipulation in a contract is made may maintain a suit on such stipulation in his own name. Fitzgerald v. Barker, 70 Mo. 687. This doctrine was first confined to suits on simple contracts. Bank v. Benoist, 10 Mo. 519; Robbins v. Ayres, 10 Mo. 538; Meyer v. Lowell, 44 Mo. 328; Flannigan v. Hutchinson, 47 Mo. 237. But this rule was afterward extended to covenants. Rodgers v. Gosnell, 51 Mo. 466; Fitzgerald v. Barker, 85 Mo. 14; Rodgers v. Gosnell, 58 Mo. 589. See, also, Van Schaick v. Railroad, 38 N.Y. 346; Coster v. Mayor, 43 N.Y. 399; Lawrence v. Fox, 20 N.Y. 268; Schuster v. Railroad, 60 Mo. 290; Ellis v. Harrison, 104 Mo. 270; Lusk v. Ridge, 41 N.Y. 206; Railroad v. Hopkins, 18 Kan. 494; Hume v. Brower, 25 Ill.App. 130; Snale v. Ives, 85 Ill. 279; Shofer v. Kerting, 107 Ill. 344; Dean v. Walker, 107 Ill. 540. In some of these cases a distinction is drawn between simple contracts and contracts under seal, but in others this distinction is repudiated, as it has been in Missouri, notably the case of Kimbal v. Noyer, 17 Wis. 698; and Bassett v. Hughes, 43 Wis. 319. (2) It is not necessary to specify the particular debt which is assumed to be paid. Shofer v. Kerting, 107 Ill. 346; Schmidt v. Glade, 126 Ill. 470; Dean v. Walker, 107 Ill. 540; Redelsheimer v. Miller, 107 Ind. 486; Cross v. Truesdale, 28 Ind. 44; Kingsbury v. Earle, 27 Hun, 141; Schuster v. Railroad, 60 Mo. 290; Banks v. White, 14 Neb. 373; Delaney v. Anderson, 54 Ga. 586; Railroad v. Hopkins, 18 Kan. 494; Raum v. Kaltwasser, 4 Mo.App. 573; Brenner v. Luth, 28 Kan. 581; Snell v. Ives, 85 Ill. 279; Anthony v. Herman, 14 Kan. 494. (3) The execution of the deed of indenture between the South Pacific Railroad Company and the Atlantic & Pacific Company operated as a consolidation and merger of the two companies into one, to wit, the Atlantic & Pacific Company, and imposed a liability upon the Atlantic & Pacific Company to pay the debts of the other company, and this obligation was evidenced by a written contract under seal to pay the debts and liabilites of the South Pacific Company. Tomlinson v. Branch, 15 Wall. 460; Railroad v. Moffeitt, 75 Ill. 524; Railroad v. Branch Sons & Co., 59 Ala. 139; Eaton v. Hunt, 20 Ind. 457; Railroad v. Georgia, 92 U.S. 665; Washburn v. Cass Co., 3 Dillon, 251-260; Railroad v. Powell, 40 Ind. 37; Railroad v. Hendricks, 41 Ind. 59; Paine v. Railroad, 31 Ind. 283; Bryan v. Ins. Co., 16 F. 139; Thompson v. Abbott, 61 Mo. 177; Mt. Pleasant v. Beckwith, 100 U.S. 514; Company v. Company, 58 Miss. 846; Morawetz on Private Corporations, secs. 904, 905, and cases cited. (4) The execution of the tripartite agreement between the three companies operated to effect a consolidation, by which the Atlantic & Pacific Company, an insolvent company, became merged into the other two companies, through the instrumentality of the St. Louis & San Francisco Company, which owned nearly all the stock of the Atlantic & Pacific Company, both the last named companies being at the time under the same management. Morawetz on Private Corporations, sec. 943; Thompson v. Abbott, 61 Mo. 177; Eaton v. Hunt, 20 Ind. 457; Railroad v. Georgia, 96 U.S. 665; Act of March 24, 1870, sec. 57, Sess. Acts of 1870, p. 90; 1 Wag. Stat. pp. 314-315. The consolidation of two companies does not necessarily work the dissolution of both. Company v. Georgia, 92 U.S. 667. (5) But, if the tripartite agreement did not effect a consolidation, the obligations of that agreement were that the San Francisco Company would pay all the debts and liabilities of the Atlantic & Pacific Company, and the debt due the state of Missouri was one of those liabilities. (6) The intention of the parties to the tripartite agreement must be gathered from a fair interpretation of the language of the instrument itself, and when the engagement of the parties, and the extent and manner of their undertaking has been reduced to writing, all oral testimony of a previous colloquium between the parties, or of conversations or declarations at the time it was completed or afterwards, is incompetent and inadmissible to contradict or vary the terms of the written instrument. Greenleaf on Evidence, secs. 275-277; Brenner v. Luth, 28 Kan. 581; 2 Wharton on Evidence, 920-923. (7) The tripartite agreement was a Missouri contract and its interpretation and its obligations must be determined by the laws of Missouri, because, although signed in Boston, it did not become binding upon the parties until it was filed in the office of the secretary of state. See act of March 24, 1870, sec. 57. Sess. Acts of 1870, p. 90; Blue Book, p. 171; R. S. 1889, sec. 2568; 1 Wag. Stat. pp. 314-315; 3 Am. & Eng. Encyclopedia of Law, 543, 544; Cox v. United States, 6 Pet. 361; Bank v. Daniels, 12 Pet. 32; Tilden v. Blair, 21 Wall. 246; 2 Kent's Com., 460 and note; Mansfield v. Robinson, 2 Burr. 1077; Fanning v. Consequa, 17 John. 519; Freese v. Brownell, 35 N. J. 286; Campbell v. Nicholas, 33 N.Y. 81; Pomeroy v. Ainsworth, 22 Barb. 128; Meyers v. Carr, 12 Mich. 63; Wiston v. Stodder, 8 Martin, 134. (8) The debt is not barred by limitation. Carr's Adm'r v. Hurlburt, 41 Mo. 269; Chidsey v. Powell, 91 Mo. 626; Mastin v. Branham, 86 Mo. 644; Wood v. Marawitz, 9 A. (R. I.), 427. And where there is an acknowledgment of indebtedness, it will be taken to relate to the demand in suit, and the burden is upon the defendant to show that it related to another debt. Wood on Limitation, p. 162, sec. 68. The obligation to pay in this case was a contract in solido, and commences from the date of the obligation (Ammonett v. Montague, 75 Mo. 49), and, being a contract in writing and under seal, is not barred until ten years after it was made. (9) When an acknowledgment is made before the debt is barred, the statute will begin to run from the time of the acknowledgment. Chidsey v. Powell, 91 Mo. 626; Mastin v. Braham, 86 Mo. 644.

E. D. Kenna, Lee & McKeighan and L. F. Parker for respondent.

(1) The tripartite agreement of January 31 between the defendant, the Atchison, Topeka & Santa Fe Railroad Company, and the Atlantic & Pacific Railroad Company, was not made for the benefit of the state with respect to the debt sued on, nor did said agreement contemplate or intend to make the state a beneficiary with respect to such debt, nor was such debt provided for in said agreement, nor could or can the state maintain an action upon, or by reason of, such agreement against the defendant. First. In order that a third party may sue upon a contract made between other parties, it must appear that he is the person intended to be benefited, that it was made for him as its primary and leading object, and not merely for the benefit of the contracting parties. Simson v. Brown, 68 N.Y. 355; Wright v. Terry, 2 S Rep. (Fla.) 6; Wheat v. Rice, 97 N.Y. 301; Pardee v. Treat, 82 N.Y. 385; Lorillard v. Clyde, 122 N.Y. 498; Markel v. Tel. Co., 19 Mo.App. 80; Burton v. Larkin, 36 Kan. 246; Bank v. Grand Lodge, 98 U.S. 123; Dow v. Clark, 7 Gray, 198; Merrill v. Greene, 55 N.Y. 270; Amonett v. Montague, 63 Mo. 201; Bank v. Aull, 80 Mo. 199; Garnsey v. Rogers, 47 N.Y. 238; Cathcart v. Foulke & Sons, 13 Mo. 561; Ellis v. Harrison, 104 Mo. 270; Cochrane v. Stewart, 63 Mo. 424; Austin v. Seligman, 18 F. 519. Second. The bond given to the state by the South Pacific Railroad Company was not known to the defendant at the time of the making of the tripartite agreement. The contract was not made with reference to it, and, therefore, said contract should not be held to embrace or include it. The consideration for a promise moving from the promisee to a third person, but unknown to the promisor, is insufficient to support an action on the promise. Ellis v. Clark, 110 Mass. 389. A contract embraces only matters concerning which the parties propose to contract, and not other matters unknown to them, however general the terms employed. Case v. Cushman, 3 W. & S. 544; Schnieder v. Leibengood, 4 Pa. St. 308. Knowledge or ignorance of facts necessary to the application of the instrument to the person or things discussed, or even the belief of the parties, is important to put the court in the position of the parties, so as to determine what was meant. 2 Parsons on Contracts [7 Ed.], 562, 692; Blair v. Railroad, 89 Mo. 383; 1 Story's Eq. Jur., sec. 145; Pomeroy v. Benton, 57 Mo. 551. Third. The only part of the tripartite agreement which by any possibility could give a right to sue the defendant on account of the debts of the Atlantic & Pacific is that part which provides for the payment of the then past due coupons. The remainder of the contract with respect to the debts of the Atlantic & Pacific is substantially a contract to save harmless or to indemnify the Atlantic & Pacific and the Atchison, Topeka & Santa Fe Railroad Companies. Where a contract is in substance one for indemnity, third parties can not sue on the same. Peacock v. Williams, 98 N.C. 324; City of Kansas ex rel. v. O'Connell, 99 Mo. 367; Vilas v. Page, 13 N.E. 743; Roddy v. Railroad, 104 Mo. 234. Fourth. The general passage or clause in the tripartite agreement, as well against such as are hereinbefore enumerated, classified and described as any and all others now existing, can not be construed to enlarge the purpose and intention of the parties beyond mere minor claims of the same class and character as those specifically described. Shelton v. Pease, 10 Mo. 473; Miller v. Wagenheuser, 18 Mo.App. 11; Torrence v. McDougall,...