Inman v. South Carolina Ry Co

• Decision Date: 14 January 1889
• Citation: 32 L.Ed. 612,9 S.Ct. 249,129 U.S. 128
• Parties: INMAN et al. v. SOUTH CAROLINA RY. CO
• Court: U.S. Supreme Court

9 S.Ct. 249

129 U.S. 128

32 L.Ed. 612

INMAN et al. v. SOUTH CAROLINA RY. CO.

January 14, 1889.

William H. Inman, John H. Inman, James Swann, Bernard S. Clark, and Robert W. Inman, copartners in business under the firm name of Inman, Swann & Co., brought suit against the South Carolina Railway Company, in the circuit court of the United States for the district of South Carolina, on the 18th of July, 1884, to recover damages for the loss of 248 bales of cotton, (out of 809 bales,) which the defendant, as a common carrier, had received at Columbia, S. C., to be safely carried for certain freight money to Charleston, in that state, and there delivered to a connecting carrier, to be transported to New York, and which, the plaintiffs averred, the defendant did not safely carry and deliver, but which were, while in the defendant's possession, custody, and control as a common carrier, 'by the carelessness and negligence of the defendant, its officers, agents, and servants, destroyed by fire.'

In its answer the defendant admitted the shipment, names of shippers, place of shipment, and number of bales shipped; and averred 'that, at the date of the receipt and shipment of said cotton, bills of lading were given therefor, in which were stated the conditions, stipulations, and agreements upon which said cotton should be carried by the railroad company receiving it, and by the connecting roads, which bills of lading, and the conditions, stipulations, and agreements thereof, were received and accepted by the plaintiffs, and constitute the contract between them and the defendant;' that the cotton was received 'subject to the conditions, stipulations, and agreements of said bills of lading,' and that the 248 bales were destroyed by fire; but denied, as a first defense, the allegations in respect to negligence; and, as a second defense, stated 'that, among other stipulations and agreements in said bills of lading under which said cotton so destroyed by fire was carried is the following, to-wit: 'And it is further stipulated and agreed that, in case of any loss or damage done to or sustained by any cotton herein receipted for during transportation, whereby any legal liability may be incurred by the terms of this contract, that the company alone shall be held responsible therefor in whose actual custody the cotton may be at the time of the happening of such loss or damage, and the company incurring such liability shall have the benefit of any insurance which may have been effected upon or on account of said cotton;' that the plaintiffs had fully insured said cotton, so destroyed by fire, in solvent companies, from risks, among which fire was one, and that at the time of the occurrence of said fire said cotton was fully covered by insurance; but that this defendant has not had the benefit of such insurance, nor have the plaintiffs given or offered to give it the benefit of such insurance.'

The bill of exceptions states that the plaintiffs, to maintain the issue on their part, examined Bernard S. Clark, (one of the plaintiffs,) who proved the delivery of the cotton to the Greenville & Columbia Railroad, to be carried to the plaintiffs at New York; the receipt of the cotton by the defendant as a connecting carrier; its destruction by fire at Charleston on the 29th day of October, A. D. 1883, while in the custody of the defendant, awaiting delivery to the next connecting carrier; and that the value of the cotton, less freight, was $10,717.21; that the form of the bills of lading given to the agent of the plaintiffs by the Greenville & Columbia Railroad Company, the first carrier, was as set out, and contained the clause above quoted. Upon examination by defendant, the witness testified that plaintiffs had open policies of insurance in the Phoenix, Mechanics' & Traders', and Greenwich Insurance Companies, but had not received any money for the loss occasioned by the burning of the cotton in question; that the insurance companies had signed certain memoranda, which witness produced; that witness instructed Mr. Gallagher, an insurance adjuster at Charleston, to bring suit if defendant did not pay; that witness did not know that Gallagher represented the above-named insurance companies, but be had said there would be no expense to plaintiffs; that, 'by our policies, in case of loss, we have to pay four per cent. on that loss, to keep our policy good for twenty thousand dollars all the time. My object is to get this money from the railroad companies, and save this four per cent.; and $150 average comes in there; and in case I don't get it from them to fall back on my insurers,—the insurance companies,—and make them pay it. That is the exact reason; and if I don't get it from them the idea is that I will fall back on the insurance company.' On redirect examination, the witness testified that the plaintiffs were the owners of the cotton, and did not authorize their agent to take bill of lading with insurance clause, but plaintiffs had received the balance of the cotton, and settled for the freight on it under the same bill of lading; that the agent 'had authority to take bills of lading for the cotton, but had to accept what the company would give him or no bill of lading.'

The policy issued to plaintiffs by the Mechanics' & Traders' Insurance Company on cotton burned bears date 7th September, 1883, and contains the following provisions: 'It is also agreed and understood that, in case of loss or damage under this policy, the assured, in accepting payment therefor, hereby and by that act assigns and transfers to the said insurance company all his or their right to claim for loss or damage as against the carrier, or other person or persons, to inure to their benefit, however to the extent only of the amount of the loss or damage and attendant expenses of recovery paid or incurred by the said insurance company; and any act of the insured waiving or transferring or tending to defeat or decrease any such claim against the carrier, or such other person or persons, whether before or after the insurance was made under this policy, shall be a cancellation of the liability of the said insurance company for or on account of the risk insured for which loss is claimed. * * * In event of loss, the assured agrees to subrogate to the insurers all their claims against the transporters of said cotton, not exceeding the amount paid by said insurers.' Similar provisions are contained in the policy issued by the Greenwich Company to the plaintiffs on cotton destroyed. The policy issued by the Phoenix Insurance Company on said cotton contained the following provision: 'In case of any agreement or act, past or future, by the insured, whereby any right of recovery of the insured against any persons or corporations is released or lost, which would, on acceptance of abandonment or payment of loss by this company, belong to this company but for such agreement or act, or, in case this insurance is made for the benefit of any carrier or bailee of the property insured other than the person named as insured, the company shall not be bound to pay any loss, but its right to retain or recover the premium shall not be affected;' also the further provision, 'that, in event of loss, the insured agrees to subrogate to the insurers all their claims against the transporters of said cotton, not exceeding the amount paid by said insurers.'

The memoranda referred to as signed by the insurance companies on the dates named are as follows:

'NEW YORK, Nov. 17, 1883.

'To Inman, Swann & Co.: In accordance with the provision of this policy, the estimated loss sustained by this...