Alabama Great So. R. Co. v. Louisville & Nashville R. Co., 15449.

Decision Date16 August 1955
Docket NumberNo. 15449.,15449.
Citation224 F.2d 1,50 ALR 2d 1302
CourtU.S. Court of Appeals — Fifth Circuit

Joseph F. Johnston, Leigh M. Clark, Birmingham, Ala., Sidney S. Alderman, Vice-President and Gen. Counsel, Henry L. Walker, Gen. Sol., Southern Railway System, Washington, D. C., Cabaniss & Johnston, Birmingham, Ala., of counsel, for appellant.

White E. Gibson, Birmingham, Ala., Robert E. Steiner, Jr., Robert E. Steiner, III, Montgomery, Ala., Charles H. Eyster, Decatur, Ala., J. L. Lenihan, Louisville, Ky., Steiner, Crum & Baker, Montgomery, Ala., of counsel, for appellee.

Before HUTCHESON, Chief Judge, and RIVES and TUTTLE, Circuit Judges.

HUTCHESON, Chief Judge.

This suit, filed May 6, 1952, was brought to enforce the provisions for indemnity of what is known and called the Standard Detour Agreement, adopted, promulgated, and in use for years by the Association of American Railroads.

The prayer was for an order requiring the defendant to proceed to arbitration as required by paragraph 7 of the agreement, and, in the alternative, for the entry of a judgment declaring that, under paragraph 41 of the agreement, defendant is liable to indemnify plaintiff against, and save it harmless from, all liability or claim for delays, losses, damages, etc., which the plaintiff has incurred or will incur as a result of a collision occurring on plaintiff's line between defendant's train, then being operated over it under the detour agreement, and a passenger train belonging to and being operated by plaintiff.

On June 12, and before defendant had answered, plaintiff apparently abandoned its effort to obtain arbitration. Alleging: that there was no genuine issue between the parties as to any material fact;2 and that plaintiff was entitled to judgment as matter of law; and, invoking the jurisdiction of the court as a court, it sought a summary judgment for the declaratory relief prayed for in the complaint.

The defendant, admitting the execution of the detour agreement, the occurrence of the collision with plaintiff's train while defendant's train was being detoured over plaintiff's lines, and that large and heavy losses and damages had occurred, denied, for the reasons set out by it at length, that plaintiff was entitled to any of the relief sought. In addition, it filed a counter-claim alleging that the collision was the result of plaintiff's negligence, simple or wanton, and prayed for a judgment declaring that plaintiff is liable for all damages caused to, or claimed of, defendant as a result of the collision.

Thereafter, on August 29, 1952, the defendant, opposing plaintiff's motion for summary judgment but alleging that there is no genuine issue as to any material fact and that defendant is entitled to a judgment as matter of law, moved for a summary judgment on its counterclaim.

The district judge, upon full consideration of the pleadings, affidavits, and other matters presented in support of the respective motions, denied plaintiff's and granted defendant's motion for summary declaratory relief, and plaintiff is here presenting five specifications of error.3

Because the district judge, in a thorough and well considered full scale opinion,4 set out the pleadings, the critical clauses of the agreement, and what he considered to be the uncontroverted facts, and fully canvassed the points made in favor of and against the claims of each contestant, and we can state our own views in terms of agreement or disagreement with the views of the district judge, our difficulties are greatly reduced, our labors greatly lessened.

The district judge, understanding and appreciating the nature and scope of the claim made by plaintiff in respect to the construction and application of the agreement, stated and canvassed the issues with it fully in mind. The claim was: that the agreement was not one extorted from and imposed upon the weak by the strong and, therefore, to be construed and applied critically and grudgingly, to defeat it if possible; but was a remedial instrument, devised many years ago and employed continuously since by railroad corporations of equal stature and position to facilitate the exchange of detouring privileges and to take care of all contingencies arising thereout; and that it should be construed and applied liberally and broadly to give full effect to its principal apparent purpose. He, therefore, carefully stated and canvassed, as he saw them, the issues upon the construction and application, of the agreement, in the light of this claim, and dealt with them accordingly.

In substance, this is the way he stated the first one:

"Are the indemnity and exemption provisions applicable as contended for by defendant only when the losses and damages are proximately caused by the operation of the detouring train, or was "the descriptive phrase, `in whatever manner the same may be caused\' intended expressly to eliminate the restrictive requirement of proximate causal connection between operation of the detouring train and damages and to apply the indemnity and exemption provision to damages resulting, which would not have occurred but for the fact of the detour, the existence of additional hazards imposed by the very presence of a foreign train on the tracks in use even though the loss and damage directly resulted from the negligence of the indemnitee\'s own servants"?

The second was thus stated:

"Are the indemnity and exemption provisions intended to apply under any and all circumstances including those where the losses and damages are the result of wanton conduct of the Home Company\'s employees?"

The third, which was in large measure included, and dealt with, in the first two, was stated thus:

"Are the indemnity and exemption provisions void (1) as a matter of public policy; or (2) as ultra vires?"

Dealing with each of these questions in its turn and carefully considering the arguments and the many authorities put forward by each side upon the first question, the district judge, we believe correctly, rejected the narrower contention of the defendant, and held that the descriptive phrase in the contract, "in whatever manner the same may be caused", was inserted to insure against a narrow and limiting construction, that to recover the indemnity provided for, plaintiff must show in the technical legal sense proximate causal connection between the operation of the detouring train and the damages.

Upon the second question, he concluded upon the authority of Thomas v. Atlantic Coast Line, 5 Cir., 201 F.2d 167, in effect: that, while the language "whether by or through the negligence of the Home Company or otherwise", properly construed, covered simple negligence, it could not properly be construed as intended to extend, or as extending, to damages occasioned by willful conduct or wanton negligence; and, further, that if it could be said that the agreement purported to exempt the Home Company from liability for the consequences of a willful breach of duty or wanton...

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