Henry Mercantile Co. v. Georgetown & W.R. Co.

• Decision Date: 30 June 1916
• Docket Number: 9415.
• Citation: 89 S.E. 480,104 S.C. 478
• Parties: HENRY MERCANTILE CO. v. GEORGETOWN & W. R. CO.
• Court: South Carolina Supreme Court

89 S.E. 480

104 S.C. 478

HENRY MERCANTILE CO. v. GEORGETOWN & W. R. CO.

No. 9415.

Supreme Court of South Carolina

June 30, 1916

Appeal from Common Pleas Circuit Court of Williamsburg County; S.W G. Shipp, Judge.

Action by Henry Mercantile Company against the Georgetown & Western Railroad Company. From a judgment for plaintiff, defendant appeals. Affirmed.

Kelley & Hinds, of Kingstree, for appellant.

Stoll Stoll & O'Bryan, of Kingstree, for respondent.

GARY C.J.

This is an action for damages, caused by fire to a lot of cotton placed by plaintiff upon a platform on defendant's right of way. It is alleged that the fire was communicated to the cotton by sparks from a locomotive engine belonging to the defendant. The defendant demurred to the complaint, on the ground that it did not state facts sufficient to constitute a cause of action, for the following reason:

"Because it does not appear on the face of the said complaint that at the time this suit was commenced the defendant was a railroad corporation, but, on the contrary by a proper construction and interpretation of the terms and allegations contained in said complaint, it appears on the face thereof that at the time this suit was commenced the defendant had ceased operating its railroad, and therefore was not then a 'railroad corporation' according to the true meaning and intention of section No 3226, vol. 1, Code of Laws of South Carolina 1912, under which this action is brought."

The demurrer was overruled, and the first exception assigns error in this respect. Section 3226, Code of Laws 1912, is as follows:

"Every railroad corporation shall be responsible in damages to any person or corporation whose buildings or other property may be injured by fire, communicated by its locomotive engines, or originating within the limits of the right of way of said road in consequence of the act of any of its authorized agents or employés, except in any case where property shall have been placed on the right of way of such corporation, unlawfully or without its consent." The defendant in its answer alleges that the plaintiff was not, and is not, a corporation as alleged in the complaint, and that it admits that the charter has not been formally dissolved or revoked, but alleges that it has ceased to do business under its charter. The fire occurred on the 10th of February, 1915, and the defendant disposed of its franchises in the manner set forth in the exception, on the 1st of May, 1915. Section 2812 of the Code of Laws 1912, is as follows:

"All corporations heretofore or hereafter incorporated in this state, either by the Legislature, the secretary of state, or a clerk of court, shall always have the right to go into liquidation, and to wind up their affairs, and dissolve, by resolution of the stockholders, representing a majority of capital stock had, after such notice as is hereafter provided; said resolution to be signed by the president and secretary, or other officers of the corporation, and forwarded to the secretary of state to be filed * * * in his office: Provided, that such resolution shall not bar an action, for two years thereafter against the corporation or any of the members, for any liability incurred during the existence of the corporation."

There is no doubt that the liability was incurred and the cause of action accrued, when the fire took place on the 10th of February, 1915, during the corporate existence of the defendant, and while it was operating the road. The statute provides the manner in which the corporation may be dissolved, but it does not contemplate a dissolution until the affairs of the corporation have been liquidated. Meyer v. Brunson, 104 S.C. 84, 88 S.E. 359. This case, therefore, falls within the provisions of the statute.

The appellant relies upon the case of Hunter v. Railway, 41 S.C. 86, 19 S.E. 197. That case merely decides that under section 3226 of Code of Laws 1912, only the railroad company operating the road is liable under the statute, and that when such fire is communicated by the locomotive engine of the lessee, the lessor is not responsible for damages under the statute. That case shows clearly that, as the defendant was operating the road, at the time of the fire, which took place before it conveyed its franchises to the Carolina, Atlantic & Western Railway Company, it was liable for the damages.

The second exception assigns error, on the part of his honor the presiding judge, in sustaining the demurrer to the second defense, on the ground that it did not state facts sufficient to constitute a defense. The second defense is as follows:

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