Batesburg Cotton Oil Co. v. Southern Ry. Co.

• Decision Date: 08 March 1916
• Docket Number: 9319.
• Parties: BATESBURG COTTON OIL CO. v. SOUTHERN RY. CO. ET AL.
• Court: South Carolina Supreme Court

88 S.E. 360

103 S.C. 494

BATESBURG COTTON OIL CO. v. SOUTHERN RY. CO. ET AL.

No. 9319.

Supreme Court of South Carolina

March 8, 1916

Appeal from Common Pleas Circuit Court of Lexington County; John S Wilson, Judge.

Action by the Batesburg Cotton Oil Company against the Southern Railway Company and another. Judgment for defendants sustaining their demurrers, and plaintiff appeals. Affirmed.

Thurmond Timmerman & Callison, of Lexington, Barrett Jones, of Batesburg, and C. M. Efird and T. C. Sturkie, both of Lexington, for appellant.

B. L. Abney, of Columbia, Johnstone & Cromer, of Newberry, and E. L. Asbill, of Leesville, for respondents.

WATTS J.

This is an action for $79,602.45 for the loss of plaintiff's plant and property at Batesburg, April 27, 1913. It is alleged that the property was destroyed by fire communicated to it by a locomotive of defendant on the main line of Southern Railway Company. The defendant in its answer sets up, as a bar to its recovery, certain exemption clauses in an industrial track agreement and track scale agreement made with the Batesburg Oilmill, and warehouse agreement and an industrial track agreement made with the plaintiff. The plaintiff, by reply, alleges that the Batesburg Oilmill was never a corporation, though such a corporation was contemplated; that A. C. Jones, who executed the agreement on the part of Batesburg Oilmill and the plaintiff, was acting without authority from the directors and stockholders of the plaintiff, and that the agreements are ultra vires; and that A. C. Jones, president, was induced to execute the industrial track agreement by false and fraudulent representation of the agents of the railway company that the exemption clause did not apply to fires communicated from the main line, that the Supreme Court of South Carolina had so held, and that this was the railway company's construction of the contract. The defendant railway company demurred to the sufficiency of the reply, and Judge Wilson sustained the demurrer on three grounds: (1) That the plaintiff, having enjoyed the benefits of the contract with Batesburg Oilmill, is estopped from denying that it was at least a de facto corporation; (2) that the plaintiff, having enjoyed the benefits of the industrial track agreements, is estopped from pleading that they were ultra vires; and (3) that the plaintiff cannot escape liability by pleading misrepresentations as to opinions and matters of law. From this order plaintiff appeals and by nine exceptions alleges error on the part of his honor in holding that the plaintiff is estopped from denying it was at least a de facto corporation, and in not holding that the time of the execution of the agreement it was not in existence at all, and if it availed itself at all by use of industrial side tracks, it did so because of representations made by its agents, and such acts did not amount to an estoppel; error also in holding plaintiff is estopped from pleading that its agents acted ultra vires in executing the side-track contract as plaintiff availed itself of the advantages and benefits; error in holding that representations of defendant's agents as to fires were misrepresentations as to the opinions and matters of law, and in not holding the contrary; error in not holding that the reply raised issues of fact, and in not holding that the alleged contract was contrary to public policy, as it undertook to relieve the defendant from liability for the negligent and willful acts of its servants; error in not holding that plaintiff could show waiver; and error in not holding that the reply alleged the parties had agreed as to how the contracts were to be construed, and defendant was estopped from contending for a different construction.

It will be seen that the plaintiff's exceptions in part insist that they are certain issues of facts raised by the pleadings, and, as the demurrer admits the truth of the reply, these issues should be submitted to a jury.

The sufficiency of the reply will be tested: (1) Whether the exemption clauses in the industrial track agreements are contrary to public policy. By reference to the contract between the plaintiff, made September 15, 1911, and the Southern Railway Company, the Batesburg Oil Company was given the license or right to erect and maintain two warehouses in the right of way of the railroad company, and has the following clauses:

"That it will indemnify and save harmless the railway company against any and all loss or damage to property of the railway company, and against all claims, demands, suits, judgments, or sums of money accruing to the licensee, or to any other party, against the railway company, for loss or injury, caused by fire, or otherwise, howsoever resulting, either to person or estate, and arising by reason of the presence of

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