Atlantic Coast Line R. Co. v. Dunning

• Decision Date: 05 November 1908
• Docket Number: 763,764.
• Citation: 166 F. 850
• Parties: ATLANTIC COAST LINE R. CO. v. DUNNING. SAME v. MYERS.
• Court: U.S. Court of Appeals — Fourth Circuit

166 F. 850

ATLANTIC COAST LINE R. CO. v. DUNNING.

SAME v. MYERS.

Nos. 763, 764.

United States Court of Appeals, Fourth Circuit.

November 5, 1908

T. M Mordecai and P. A. Willcox (Willcox & Willcox, Henry E Davis, W. Hugher Fitz Simons, and Simeon Hyde, on the briefs), for plaintiff in error.

W. A Holman (W. B. Gruber, J. G. Padgett, and Legare & Holman, on the briefs), for defendants in error.

Before FULLER, Circuit Justice, and MORRIS and PURNELL, District judges.

MORRIS District Judge.

These were two cases originally commenced in a court of the state of South Carolina by Dunning, who was plaintiff in one case and by Myers, who was plaintiff in the other case, against the Atlantic Coast Line Railroad Company, to recover damages for permanent personal injuries which each claimed to have suffered by the wreck of a train on which Dunning was locomotive engineer and Myers was fireman. The injuries were alleged to have been caused by the neglect and wrongful act of the defendant railroad company in providing an unsafe and defective roadbed, in that the timbers and cross-ties supporting the rails on a certain trestle, at a point on its railroad in South Carolina, were rotten and unfit to be used for the purpose.

In the plaintiff's declaration in each case, the defendant was described as a corporation created by and existing under the laws of South Carolina, and engaged in operating a railroad as a common carrier of goods and passengers between Yernassee, S.C., and Charleston, S.C. The defendant appeared, and, denying that it was a corporation of South Carolina, averred that it was a corporation created by and existing under the laws of Virginia, with its principal office and legal residence established and fixed at Petersburg, Va., and averring that the plaintiff in each case was a citizen of South Carolina, it filed its proper petition with bond and sureties, and prayed that the cases be removed to the Circuit Court of the United States for the District of South Carolina on the ground of diverse citizenship. The cases were accordingly removed. Thereupon, the plaintiffs, denying the allegation that the defendant was not a corporation under the laws of South Carolina, moved to remand. A reference was directed by the Circuit Court to a special master to take evidence and report his findings of fact pertinent to the question of diverse citizenship, and upon the coming in of the report the court (Circuit Judge Pritchard), in an able and learned opinion, reported in 150 F. 775, denied the motion and retained jurisdiction. The plaintiffs excepted to the ruling of the court on the motion to remand, and this is the error assigned by the plaintiff.

The defendant railroad company, besides pleading that it had not suffered its track to become defective and dangerous, and that the plaintiff in each case had been guilty of contributory negligence, in addition in each case pleaded a special plea, which in Dunning's Case was as follows:

'That the defendant, Atlantic Coast Line Railroad Company, maintains, in conjunction with its employes, a relief department known as the 'Atlantic Coast Line Railroad Relief Department,' by which, from mutual contributions of defendant and its employes, a fund is created and maintained, from which, among other applications thereof, in case of sickness from natural causes or accident, its employes who are members of said Relief Department are provided medical and surgical treatment and sick and death benefits, and that one of the rules of said Relief Department is to the effect that, in case of sickness or death arising from natural causes, or accident, if an employe who is a member of said Relief Department shall accept any of the benefits derived from said fund, the acceptance of such benefits shall serve to release, quitclaim, and fully discharge the defendant, Atlantic Coast Line Railroad Company, from any and all liability arising from such injury.

'That, at the time of the accident and injury to said R. O. Dunning, the plaintiff, he was an employe of said Railroad Company, and was a member of said Relief Department, having become a member thereof in consequence of his employment by said company, prior to his said injury.

'That, on account of the injuries arising from said accident, and the disabilities to which the said R. O. Dunning was subjected by reason of said injuries, sick benefits to which he was entitled under the rules and regulations of said Relief Department had been paid to him, and, in addition, said Relief Department had provided him with the medical and surgical attention which the plaintiff was then entitled to receive from the funds maintained by said Relief Department.

'That one of the regulations of said Relief Department by which plaintiff agreed to be bound provided that in case of injury to a member he may elect to accept benefits in pursuance with said regulations, or to prosecute such claim as he may have at law against said company, and that the acceptance of benefits shall operate as a release and satisfaction of all claims against the company arising from or growing out of said injury; and the defendant alleges that the plaintiff, by reason of the acceptance of said sick benefits from said Relief Department, and by reason of the payment of his medical and surgical expenses as aforesaid by the Relief Department so operated by the defendant company in conjunction with its employes, he being a member thereof in good standing at the time of his injury, has, under the rules and regulations of said Relief Department, released, discharged, and quitclaimed the defendant company from any and all claims for damages that might have been, or could otherwise be, asserted by him against the defendant company.'

A similar plea in Myer's Case alleged the payment to him of the sick benefits and medical and surgical attention to which he was entitled.

The two cases, by agreement of the parties, were tried together by the same jury, and a verdict was returned in favor of the plaintiff, Dunning, for $2,500, and in favor of Myers for $1,000, and judgments were entered thereon.

Two rulings of the Circuit Court were duly excepted to, and are before us on the writs of error. The first is the ruling holding that the cases were rightfully removed from the state courts, which is assigned as error by the plaintiffs, and the second, the ruling which was excepted to and assigned as error by the defendant, that the special plea was not a good defence.

As to the right of removal the special master found the following facts:

That in 1898, by an act of the General Assembly of Virginia (Laws 1897-98, p. 674, c. 635), the Atlantic Coast Line Railroad Company of Virginia was created by the consolidation of several Virginia railroad corporations which thereafter ceased to exist. That, prior to July 18, 1898, a number of South Carolina railroad companies were, by an act of South Carolina, permitted to consolidate and become one company under the name of the 'Atlantic Coast Line Company of South Carolina,' and said corporation was duly organized under said act, and the other corporations were merged into it and ceased to exercise any corporate functions. That the railroads operated by the Atlantic Coast Line Railroad of Virginia and those operated by the Atlantic Coast Line Railroad of South Carolina formed a continuous line of railroad, and, by the general law of South Carolina, and railroad company organized under the laws of that state operating a railroad either wholly within, or partly within and partly without, that state was authorized to merge and consolidate its capital stock, franchise, and property with those of any other railroad company or companies organized or operated under the laws of that state or any other state whenever the companies proposing to be consolidated formed a continuous line either with each other or by means of an intervening railroad. That, on January 12, 1900, the General Assembly of Virginia authorized the Atlantic Coast Line Railroad Company of Virginia to change its name and to increase its stock, and enlarge its powers, and authorized it to lease, and consolidate with itself, other corporations and, thereafter, on April 18, 1900, the Atlantic Coast Line Railroad Company, by deed of bargain and sale duly recorded, became the owner of the property and franchise of other railroads chartered by other states, including the Atlantic Coast Line Railroad Company of South Carolina, and said company and the other railroad companies so acquired ceased to exist or to exercise any of their corporate powers or functions, and all their rights, properties, and franchises became vested in and were controlled by the Atlantic Coast Line Railroad Company of Virginia. That the General Assembly of South Carolina, on March 9, 1896 (Laws 1896, p. 114, Sec. 1), had passed an act requiring that every railroad corporation created by any other state, desiring to own or carry on business or exercise any corporate function in South Carolina, should first file in the office of the Secretary of State a copy of its charter, and cause a copy to be recorded in each county in which it desired to carry on its business or own property, and that the Atlantic Coast Line Railroad Company of Virginia had complied with that law. That, as authorized by the amendment to its charter passed by the General Assembly of Virginia, January 12, 1900 (Laws 1899-1900, p. 24, c. 18), the name of the Atlantic Coast Line Railroad Company of Virginia was changed to the Atlantic Coast Line Railroad Company, and thereafter the said corporation, by its new name, controlled and operated the property and franchises formerly belonging to the Atlantic Coast Line Railroad Company of South Carolina, the stock...