Easton v. Houston & T.C. Ry. Co.

• Decision Date: 21 May 1889
• Citation: 38 F. 784
• Parties: EASTON et al. v. HOUSTON & T.C. RY. CO. et al., (PULLMAN PALACE CAR CO., Intervenor.)
• Court: U.S. District Court — Eastern District of Texas

38 F. 784

EASTON et al. v. HOUSTON & T.C. RY. CO. et al., (PULLMAN PALACE CAR CO., Intervenor.)

United States Circuit Court, E.D. Texas.

May 21, 1889

Percy Roberts, for intervenor.

Farrar Jonas & Kruttschnitt, for receivers.

PARDEE J.

The special master, among other things, reports in this case:

'On the 12th of December, 1871, the Houston & Texas Central Railway Company, the defendant in this case, entered into a written contract, above referred to, with the Pullman Palace Car Company, an Illinois corporation, in which among other things, it was agreed that for the mutual benefit of the contracting parties the car company would furnish to the railway company a number of new and improved drawing-room and sleeping cars, sufficient to meet the demands of travel over said railroad; the contract to be operated for 15 years from its date, unless sooner dissolved for cause, as therein provided. The car company undertook to keep in good repair, and renew, as might be required, the carpets, bedding, and upholstery of said cars, except such repairs and renewal as might become necessary from injury to the cars by accident or casualty. The railway company undertook to repair all damages to the cars occasioned by accident or casualty, and also at its own expense furnish fuel for said cars, and material for the lights, and shall wash and clean said cars, and shall also keep said cars in good order and repair, including renewal of worn-out parts, and all things appertaining to said cars, necessary to keep them in first-class condition. The contract does not provide for the payment of any rent or hire by the railway company for the use of the cars, the consideration between the parties being, in substance, that the one should furnish, and the other have or transport them; the car company having the right to sell the privileges of the car, while the railway company, by their use, were enabled to afford better accommodations to such of the traveling public as desired to avail themselves of such advantages. under this contract the car company furnished the railway company three sleeping-cars,-- the 'Houston,' the 'Preston,' and the 'San Jacinto,'-- which cars were in possession of, and being operated by, the railway company on the 24th day of February, 1885. On the 24th of February, 1885, the property of said railway company passed into the custody of Messrs Benjamin G. Clarke and Charles Dillingham, receivers, under an order of this court, of date the 20th of that month, entered in equity suit No. 185 on the docket of that court, entitled 'The Southern Development Company v. The Houston & Texas Central Railway Company.' The cars passed into the possession of said receivers on that date, and were operated by them as before they had been operated by the railway company, until the 10th July, 1886, when said receivers transferred the possession of said cars to their successors in office, Easton, Rintoul, and Dillingham, the receivers in this cause, and the defendants in this intervention, who continued to use and operate the cars as before they had been used and operated, until the termination of said contract, December 12, 1871. The receivers in said suit No. 185, Clarke and Dillingham, were informed at or about the time in December, 1885, they took possession of the cars referred to, that they were held and being operated by the railway company under the aforementioned contract, and the receivers in this cause had like notice and knowledge; but the receivers in neither of said causes made any contract or agreement with the car company, except such, if any, as arises from the continued use by them of the cars with the knowledge of the contract. It is alleged in the petition that on the 5th of October, 1886, the contract of December 12, 1871, was changed by oral agreement between the car company and the defendants herein, so as to provide that thereafter the car company would keep the cars in repair, and the defendant receivers would put them in good repair before they delivered them to the car company, to be by it kept in repair under the alleged oral agreement; and, further, that the amount necessary to put them in such repair should be determined by experts mutually agreed upon, which amount should be paid by such receivers. This is no evidence in support of these allegations. As the case is presented, the said cars 'Houston,' 'Preston,' and 'San Jacinto' passed into the possession of said receivers, Clarke and Dillingham, subject to the contract aforesaid between the car company and the railway company, in which it was provided, among other things, that the railway company would keep said cars in good order and repair, including renewal of worn-out parts, and all things appertaining to said cars, necessary to keep them in first-class condition. This contract was known to said receivers when they took possession of the cars, and was known to their successors, the present receivers, and defendants herein, when the cars passed into their hands; and I am of opinion, and so find, that the continued use by said receivers of said cars, under these circumstances, was, in legal contemplation, an adoption by them of the contract, and rendered the defendants in this suit liable to the car company under the above-quoted terms of the contract, without regard to the condition of the cars when received by them.

'It is agreed between

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