Michigan Cent. R. Co. v. State, 12568.

• Decision Date: 25 January 1927
• Docket Number: No. 12568.,12568.
• Parties: MICHIGAN CENT. R. CO. v. STATE et al.
• Court: Indiana Appellate Court

85 Ind.App. 557

155 N.E. 50

MICHIGAN CENT. R. CO.

v.STATE et al.

No. 12568.

Appellate Court of Indiana, in Banc.

Jan. 25, 1927.

Appeal from Superior Court, Marion County; James M. Leathers, Judge.

Action by the Michigan Central Railroad Company against the State of Indiana and another. From a judgment for plaintiff in an unsatisfactory amount, plaintiff appeals. Affirmed.

Harry B. Tuthill, of Michigan City, for appellants.

A. L. Gilliom, Atty. Gen., and Frank Greenwald, of Gary, for the State.

REMY, J.

On June 10, 1920, and pursuant to section 2 of the Appropriation Act of 1919 (Acts 1919, p. 196, c. 58), the state of Indiana, through its joint purchasing committee, contracted for a year's supply of coal for the Indiana State Prison, a penal institution located at Michigan City, the contract price for the coal being $3.40 per ton, delivered. On October 22, 1920, while the contract was in force, appellant railway company, a carrier of interstate commerce, had in its possession for interstate transportation a carload of coal of the same kind and quality as that contracted for by the state, which coal by mutual mistake of the carrier and agents of the state was delivered to the Indiana State Prison and there consumed. This carload of coal at the time and place of its delivery was of the market value of $6.85 per ton. Upon learning of the misdelivery of the coal and its consumption, appellant paid to the consignee of the coal the market value thereof and demanded of the state that it be reimbursed for the amount so paid. With this demand the state refused to comply. Whereupon appellant commenced this action against the state to recover the market value of the coal. Edward J. Fogarty, superintendent of the Indiana State Prison, was joined as a party defendant. In its complaint, appellant specifically waived any action in tort which it may have had. The cause was submitted to the court upon an agreed statement of facts, the substance of which is as above set forth. The court found against the state, but limited recovery to $3.40 per ton, the price of the year's supply of coal as contracted for by the joint purchasing committee, and judgment was so rendered.

Claiming that the amount of the recovery should have been $6.85 per ton, the market value of the coal, and was therefore too small, the railroad company prosecutes this appeal. The state not having assigned cross-errors, the only question for determination by this court is whether, under the facts stipulated, the measure of recovery is the market value of the coal at the time and place of the misdelivery, or, as held by the trial court, the price at which the joint purchasing committee had purchased the year's supply. A decision of the question will require a consideration of the nature and character of the action.

The facts in this case are unusual, as is the legal proceeding. By reason of a mistake of fact, the state received the coal from the carrier, and before the mistake was discovered the coal has been consumed. Recognizing its liability for the conversion of the coal, the carrier paid to the consignee the market value thereof, and by this action seeks indemnity from the state.

[1][2] That a carrier may recover for a consignment of goods delivered to the wrong person by mistake, in an action against the person who received and retained the goods, is not questioned by appellees, nor can it be. Hudson River, etc., R. Co. v. Lounsberry (1857) 25 Barb. (N. Y.) 597;Johnson, Nesbit & Co. v. Gulf, etc., R. Co. (1903) 82 Miss. 452, 34 So. 357; Brown v. Hogson (1811) 4 Taunt. 188; Coles v. Bulman (1848) 6 C. B. 184; Hutchinson, Carriers (3d Ed.) § 863. Nor do appellees question the right of appellant to sue the state in an action of this character. That such an action against the state may be maintained, see State v. Mutual Life Ins. Co. (1910) 175 Ind. 59, 74, 93 N. E. 213, 42 L. R. A. (N. S.) 256. The state's obligation which forms the basis of this action is what is termed quasi contractual. Though frequently referred to by the courts as equitable in character, it is a legal obligation on the part of the obligor to make restitution in value-that is, to pay the equivalent of the benefit received and unjustly enjoyed. Woodward's...