Allison v. Chicago Great Western Ry. Co.

• Court: Minnesota Supreme Court
• Writing for the Court: THOMAS GALLAGHER; CHRISTIANSON
• Citation: Allison v. Chicago Great Western Ry. Co., 240 Minn. 547, 62 N.W.2d 374 (Minn. 1954)
• Decision Date: 08 January 1954
• Docket Number: No. 35959,35959
• Parties: ALLISON v. CHICAGO GREAT WESTERN RY. CO.

Page 374

62 N.W.2d 374

240 Minn. 547

ALLISON v. CHICAGO GREAT WESTERN RY. CO.

No. 35959.

Supreme Court of Minnesota.

Jan. 8, 1954.

Syllabus by the Court.

1. Under M.S.A. § 605.06, as construed by this court in Snyder v. Minnetonka & White Bear Nav. Co., 151 Minn. 36, 185 N.W. 959, an appeal lies from the whole of an order granting judgment notwithstanding the verdict made in response to an alternative motion for such judgment or a new trial. Under Rule 50.02(2) of the Rules of Civil Procedure, an order granting motion for judgment notwithstanding the verdict is appealable when made in response to an alternative motion for such judgment or for a new trial.

2. The validity of a release for injuries covered by the Federal Employers' Liability Act is to be determined by federal rather than state law.

3. Under the Federal Employers' Liability Act, the present rule is that a fair preponderance of the evidence is sufficient to avoid a release for mistake or fraud, although previously federal courts adhered to the rule that such evidence must be clear, unequivocal, and convincing.

4. A doctor's expressions of opinion or prophecy as to the time required for recovery, based upon mistake as to the nature and extent of the injuries sustained and later determined to be incorrect because injuries were different and more serious than those upon which prophecy was based, are more than mere forecasts or opinions as to future events. They are assurances as to present material facts; and, if a release is executed in reliance upon them, it may be invalidated by a showing of the falsity of such representations.

5. Testimony by plaintiff as to the circumstances surrounding accidents; as to injuries sustained thereby; as to subsequent pain, suffering, and medical treatment; and as to inability to continue employment supported by medical testimony that injuries sustained as a proximate result of the accident included injuries to back; narrowing of the intervertebral space between the fifth lumbar vertebra and the sacrum; and lumbosacral strain involving back muscles and ligaments with resultant 40 percent permanent partial disability Held sufficient to support jury's finding that statements made by defendant's doctor inducing execution of release were material and were untrue and, hence, rendered the release invalid.

6. Under Federal Employers' Liability Act, money paid upon a release executed as the result of representations indicating mistake as to material facts must be returned or tendered back prior to the institution of an action to invalidate release. This rule is subject to the exception that testimony by claimant that he was unaware that instrument executed constituted a release, that he had not read it, or that it was represented to him as other than a release makes issue for jury as to whether retention of consideration constituted ratification of release.

William A. Tautges, Robert M. Austin, Peterson & Brady, Minneapolis, for appellant.

Millett V. O'Connell, Hastings, Faegre & Benson, Paul J. McGough, G. Alan Cunningham, John A. McEachron, Jr., Minneapolis, for respondent.

THOMAS GALLAGHER, Justice.

Action by Frank J. Allison under the Federal Employers' Liability Act, 45 U.S.C.A., §§ 51 to 60, for personal injuries sustained July 22, 1950, while he was engaged in his employment by defendant in the latter's yards at Oelwein, Iowa. Plaintiff claims that defendant negligently permitted spikes to project from its railroad ties in the yard where he was working so that, as a result, he came in contact with one or more of them, tripped, and fell across a rail, sustaining permanent injuries to his back.

Defendant denied liability and the extent of the injuries claimed by plaintiff and as a further defense alleged that on August 11, 1950, in consideration of $200, plaintiff had released it from all claims arising out of the accident.

In his reply plaintiff denied that he had signed a release for his injuries and alleged that, if he signed such an instrument, it was under the belief that the $200 paid therewith represented only his loss of wages between July 23, 1950, and August 11, 1950, occasioned by his injuries. He further alleged that he was induced to sign the instrument by the false statements of defendant's physician that he had fully recovered from his injuries and could resume his regular employment at that time. He offered to credit the $200 against any verdict received.

At the trial plaintiff's testimony as to conversations with defendant's claim agent relative to the release was limited under M.S.A. § 595.04 because of the death of the agent prior to trial. Plaintiff testified that before he returned to work he drew $25 from defendant and that about four days after he returned to work he received an additional $175; that he did not then read the printed matter on the checks or the receipts which accompanied them beyond ascertaining the sum of money described therein; that he had not read the instrument which he signed at the time the check for $175 was delivered to him and that he did not know it was a release; that his daily wage was then $14.10; that he was absent from work on account of the injury between July 23, 1950, and August 7, 1950; that he had had two prior accidents while working for defendants; and that in each when he was paid money therefor by defendant he signed 'receipts' like he did 'with all of them.' It does not appear that a copy of the instrument was left with him.

He further testified that the instrument was signed only after and in reliance upon certain statements made to him by Dr. Ward, defendant's physician, to the effect that his injury was limited to a 'bruised back' from which he would fully recover in three or four weeks and which would not prevent his return to work August 7, 1950; that such statements were untrue; that he did not recover within three or four weeks but thereafter his injuries became more acute and painful. He presented medical testimony that the injuries resulted in a narrowing of the intervertebral space between the fifth lumbar vertebra and the sacrum and a lumbosacral strain involving his lower back, with approximately 40 percent partial permanent disability.

At the close of the testimony defendant moved for a directed verdict on the grounds, among others, (1) that the evidence failed to establish that the release was obtained by fraud or through mutual mistake of fact and (2) that, there having been no timely rescission of the release by plaintiff, it was determinative of the action. This motion was denied, and the trial court then charged the jury with reference to the release as follows:

'If you decide that the plaintiff has proved by a Fair preponderance of the evidence that Doctor Ward made the representations substantially as plaintiff testified to; that they were untrue * * * even though made in good faith by Doctor Ward; that plaintiff relied on such false representations of Doctor Ward; that plaintiff signed the releases and * * * the checks relying on such representations * * * and * * * was damaged thereby, then you must decide that the release is not a defense to the plaintiff's suit for damages in this case but in so far as he has received the $200.00, the railroad company is entitled, in any event, to a credit therefor.' (Italics supplied.)

Following the court's charge, defendant's counsel excepted thereto as follows:

'* * * defendant excepts to the Court's permitting the jury to simply credit the amount of the release against the verdict, rather than submit the question of rescission and timeliness thereof.'

The jury returned a verdict for plaintiff for $18,000. Subsequently, defendant moved for judgment notwithstanding the verdict or for a new trial. On September 23, 1952, the court granted its motion for judgment notwithstanding the verdict but did not pass on the motion for a new trial. In a memorandum made a part of its order, the trial court stated:

'As a matter of law, the evidence showed no mistake of fact or fraud in procuring the release. The mistake was in prophecy only. The law set forth in Chicago & N.W.R. Co. v. Wilcox, 8 Cir., 1902, 116 F. 913, is applicable. Also applicable are the following cases:

'Richardson v. Chicago, Milwaukee & St. Paul R. Co., 157 Minn. 474, 196 N.W. 643.

'Dolgner v. Dayton Co., 182 Minn. 588, 235 N.W. 275.

'Yocum v. Chicago, R.I. & P.R. Co., 189 Minn. 397, 249 N.W. 672.

'The evidence is also conclusive, as a matter of law, that plaintiff did not timely make a rescission and timely tender back the consideration received for the releases; the defendant's claim agent and one of the defendant's doctors died prior to the commencement of this action; the defendant, therefore, did not have the opportunity of getting information relative to the extent of the injuries and the circumstances surrounding the procuring of the release.

'See: Graham v. Atchison, T. & S. F. Ry. Co., 9 Cir., 1949, 176 F.2d 819.'

This is an appeal from the Whole of the order of September 23, 1952. On appeal plaintiff contends (1) that it was for the jury to determine whether the release was procured through mistake of fact or fraud and a Fair preponderance of the evidence sustained the finding of its invalidity on this ground and (2) that the evidence did not conclusively establish that he had failed to make a timely rescission of the release after discovery of the mistake or fraud.

Defendant asserts (1) that there was not the Clear, certain, and unequivocal evidence of mistake or fraud necessary to support a finding of invalidity--that Dr. Ward's statements being merely prophecies or expressions of opinion as to future events, not shown to be incorrect, were insufficient for that purpose--and (2) that the evidence Conclusively established plaintiff's failure to make a timely rescission of the release. Defendant also moved to dismiss the appeal on the ground that an order granting judgment notwithstanding the...