Livingston v. Atlan

Decision Date29 May 1935
Docket NumberNo. 14074.,14074.
CourtSouth Carolina Supreme Court

180 S.E. 343


No. 14074.

Supreme Court of South Carolina.

May 29, 1935.

[180 S.E. 343]

Appeal from Common Pleas Circuit Court of Richland County; M. S. Whaley, Judge.

Action by Detry O. Livingston against the Atlantic Coast Line Railroad Company (Relief Department). From a judgment for plaintiff, defendant appeals.

Reversed, and complaint dismissed.

Thomas W. Davis, of Wilmington, N. C, and McKay & Manning, of Columbia, for appellant.

J. A. Hutto, J. Hughes Cooper, and Richard T. Maher, all of Columbia, for respondent.

BONHAM, Justice.

The appellant railroad corporation maintains for the benefit of its employees a relief department, the headquarters of which are at Wilmington, N. C. The respondent was in the employ of the defendant first as a fireman and then as an engineer, with his place of employment centering at Florence, S. C. In order to become a member of the relief department, it is necessary for the employee to make written application to the relief department and stand a physical examination. These things respondent did at Florence, S. C, and his application was forwarded to the relief department headquarters at Wilmington, N. C. The application was dated May 21, 1919, and approved by the superintendent of the relief department at his office at Wilmington, N. C, June 13, 1919, to take effect the 21st day of May, 1919. The measure of relief to which the member is entitled, and the amount of fee or premium which he pays, is determined by the grade of his employment and the amount of his pay. As he advanced in promotion, the plaintiff in this

[180 S.E. 344]

action filed two additional applications which were approved by the superintendent of the relief department, the effect of which was to increase the amount of relief to which he would be entitled and to increase the amount of the premium he must pay, but did not otherwise alter the terms of the contract made by the acceptance and approval of the first application.

The plaintiff brought action in the county court of Richland county on a claim of total disability.

Defendant by answer pleaded:

(1) A general denial and prior payment in part of benefits under the contract.

(2) Failure of plaintiff to appeal to the advisory committee of defendant as provided by the contract sued on.

(3) Relief of plaintiff and termination of the contract sued on.

(4) Failure of plaintiff to give proper notice and proof of disability.

(5) Failure of plaintiff to be examined by or report to the medical examiner of the defendant, as required by the contract.

(6) Failure of plaintiff to produce positive evidence of acute or constitutional disease in addition to subjective symptoms.

(7) That the contract sued on is a North Carolina contract, and all questions relating to its validity and reasonableness and to the enforcement of its terms and provisions and the rights of the parties are governed and controlled by North Carolina law and decisions.

The case was tried by Judge Whaley and a jury, and resulted in a verdict for plaintiff. Motions for directed verdict and for new trial were made and refused.

The defendant appeals upon 28 exceptions, but not so many issues are made thereby.

The first question demanding consideration is this: Is this a North Carolina contract, and governed by North Carolina laws and the decisions of the North Carolina courts?

On the trial, the defendant offered in evidence the case of Nelson v. Atlantic Coast Line Railroad Co., decided by the Supreme Court of North Carolina and reported in 157 N. C. 194, 72 S. E. 998, 52 L. R. A. (N. S.) 829. Plaintiff did not require formal proof for the introduction of the case, but objected to it on the ground of its irrelevancy, as this was a South Carolina contract.

The trial judge sustained the objection on the ground thus stated.

Was he right? Where was the contract made?

What attends the making of a contract? The offer stating the conditions or terms; the acceptance of the offer.

In the present case, the plaintiff made application at Florence, S. C, to the relief department of defendant at its home office at Wilmington, N. C, to become a member of the relief department, stating the terms and conditions by which he agreed to be bound. One of the. conditions and terms proposed by plaintiff in his application was in this language: "I also agree, that this application, upon approval by the Superintendent of the Relief Department, shall make me a member of the Relief Fund on and from the date specified in such approval, and constitute a contract between myself and the said Company. * * *" (Italics added.)

The acceptance and approval of this proposal was made at Wilmington in the state of North Carolina. Instantly, ipso facto, the contract became complete. All that remained to do was to notify plaintiff of the fact and to send him his certificate of membership, and copies of the rules and regulations, which he states in his application he had already seen.

It does not necessarily follow that the place where the contract is made determines the place of its enforcement. In this particular instance we think the internal facts show that the place of enforcement of this contract is at Wilmington, N. C. By the terms of the contract the premiums due by the member of the relief fund are deducted from his pay check at Wilmington. He does not send them in. In the event that he is entitled to payment for disability, payment is made by check sent him from Wilmington. It is in evidence that the plaintiff received some such checks. There is nothing further to be done in South Carolina to consummate or ratify the contract or to make this state the place of its enforcement. This is not an insurance contract. The defendant is not in the attitude of an insurance company for its own benefit or business advantage. It gets no part of the premiums paid by the members of the relief fund. On the contrary, when the money in the relief fund is insufficient to pay its obligations to employees, the defendant advances the necessary funds, depending for reimbursement on the coming

[180 S.E. 345]

in to the relief fund of sufficient money for that purpose.

The respondent's contention is that the place of performance of the contract is fixed by the provisions of section 7773 of the Code of Laws of South Carolina 1932, which section is in these words: "Condition Precedent to Doing Business in This State.--It shall be a further condition precedent to the right of any such corporation to do business in this State, that it shall be taken and deemed to be the fact irrebuttable, and part and parcel of all contracts entered into between such corporation and a citizen or corporation of this State, that the taking or receiving, from any citizen or corporation of this State, of any charge, fee, payment, toll, impost, premium or other moneyed or valuable consideration, under or in performance of any such contract, or of any condition of the same, shall constitute the doing of its corporate business within this State, and that the place of the making and of performance of such contract shall be deemed and held to be within this State, anything contained in such contract or any rules or by-laws of such corporation to the contrary notwithstanding."

Two answers to that position are unanswerable.

As just said, this relief department is not an insurance company engaged in business in this state for profit. The section, 7773, is designed to protect citizens of South Carolina dealing with foreign corporations of the character of such insurance companies. Hence, it has no application here. The matter is set at rest by the provisions of section 7788, Code South Carolina 1932, to the effect that the provisions of the chapter containing these two sections "shall in nowise apply to such railroad or railway companies which have already complied with the prior laws of this State in force at the time."

The record discloses that the defendant was operating in South Carolina with its consent before the adoption of the provisions of this chapter.

The provisions of section 7773 are stated to be: "Condition Precedent to Doing Business in This State."

The section is not applicable in this case.

What law is applicable in this case? That of North Carolina or that of South Carolina?

It is fundamental that unless there be something intrinsic in, or extrinsic of, the contract that another place of enforcement was intended, the lex loci contractu governs. If the contract be silent thereabout, the presumption is that the law governing the enforcement is the law of the place where the...

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