Raritan River R. Co. v. Middlesex & S. Traction Co.
| Decision Date | 20 June 1904 |
| Citation | 70 N.J.L. 732,58 A. 332 |
| Parties | RARITAN RIVER R. CO. v. MIDDLESEX & S. TRACTION CO. |
| Court | New Jersey Supreme Court |
(Syllabus by the Court.)
Error to Supreme Court.
Action by the Raritan River Railroad Company against the Middlesex & Somerset Traction Company. Judgment for plaintiff. Defendant brings error. Affirmed.
Robert H. McCarter, Atty. Gen., and Willard P. Voorhees, for plaintiff in error.
Charles L. Corbin, for defendant in error.
This writ of error brings under a review a judgment of the Supreme Court in favor of the defendant in error (plaintiff below), based upon findings of law and fact by Mr. Justice COLLINS, before whom the cause was tried without a jury. The action was based upon one of the stipulations of a tripartite agreement, dated September 17, 1895, made between the Raritan River Railroad Company, of the first part the New Brunswick City Railroad Company, of the second part, and the Brunswick Traction Company, of the third part. The stipulation in question was made by the latter company. That company was subsequently merged into the Middlesex & Somerset Traction Company, the present defendant, and by a subsequent agreement made between it and the plaintiff, dated June 1, 1900, the defendant undertook to perform all the covenants and agreements of the Brunswick Traction Company contained in the tripartite agreement. The latter instrument has a dual aspect; some of its stipulations being made between the railroad company and the New Brunswick City Railway Company, and the remaining stipulations being made between the railroad company and the Brunswick Traction Company. The connection of the New Brunswick City Railway Company with the transaction needs no particular mention, since the clauses that relate to it would throw no useful light upon the questions to be discussed.
The Raritan River Railroad Company was incorporated in the year 1888, under the provisions of the general railroad law of 1873. Gen. St. p. 2038 et seq. The Brunswick Traction Company was organized under the general traction act of 1893. Gen. St. p. 3235 et seq. Prom the recitals of the tripartite agreement, and from the findings of the trial justice, it appears that the railroad company owned and was operating a steam railway in the county of Middlesex, extending from New Brunswick to South Amboy, crossing a number of streets and highways at grade, and was maintaining a number of bridges, by means whereof certain highways were carried across its tracks at an elevation; that the traction company was about to construct a street railroad operated by the trolley system, extending along the highway from New Brunswick to South Amboy, crossing the steam railroad at various points, some at grade and others above grade, and proposed to use the bridges of the railroad company for the latter purpose; and that the agreement was made for the purpose of avoiding litigation, and in order to establish the respective rights of the parties. It provided that the traction company should strengthen and reinforce two bridges that had been constructed by the railroad company for highway crossings, so that the bridges would carry and sustain the increased weight and traffic placed upon them by reason of the maintenance and operation of the trolley railroad. The railroad company agreed thereafter to keep the bridges in repair, and the traction company to pay to it one-half the cost of so doing. On default of the railroad company to keep the bridges in repair, the traction company was given the right to make the repairs; the railroad company agreeing to pay to it one-half the cost thereof. The agreement gave the traction company the right to cross the steam railroad in two places at grade; the railroad company agreeing to construct and maintain the necessary frogs and crossings for the trolley company, at the expense, however, of the latter. The agreement contained specific stipulations on the part of the traction company as to the mode of guarding the safety of the grade crossings. It was further provided that, in case at any future time gates or flagmen, or both, should be required upon said crossings by any public law of the state, or by municipal action, the cost of construction, maintenance, and operation of gates, and the wages of flagmen, should be borne equally by the railroad company and the traction company. The stipulation upon which the present action was based is this: that the traction company should pay each year to the railroad company 50 per centum of any decrease in the annual passenger earnings of the latter company below its passenger earnings during the fiscal year next preceding the making of the agreement; this stipulation to go into effect at the completion of the traction road and the commencement of operations thereon between New Brunswick and South Amboy, and to continue in force for the period of 10 years thereafter, or until the payments made thereunder should equal the sum of $14,000, in which event further payments should cease. Pending the life of the stipulation just mentioned, the railroad company agreed that it would not "lower its present rates of fare unless required by law," and, if it should be required by law to lower its present rates of fare for passengers, the loss to be made up by the traction company should be computed upon the basis of the regular rates of fare in force at the date of the agreement. When the total payments made by the traction company to the railroad company under this stipulation should equal the sum of $14,000 the payments were to cease, and the agreement as to rates of fare should also cease. The agreement at the same time reserved to the railroad company the right, on notice to the traction company, to abrogate the agreement as to rates of fare by giving up all claim to the portion remaining unpaid of the $14,000. The agreement of June 1, 1900, contains nothing necessary to be now mentioned, beyond an express assumption by the Middlesex & Somerset Traction Company of the covenants and agreements of the Brunswick Traction Company contained in the instrument of September 17, 1895.
By the judgment under review the railroad company recovered damages equivalent to 50 per cent. of the decrease in its passenger receipts for the first year that the traction road was in operation, as compared with the receipts of the fiscal year that by the agreement was made the standard for purposes of comparison. Reversal of this judgment is sought on the ground that the agreement to pay to the plaintiff one-half of the decrease in its annual passenger earn ings is void for want of lawful consideration moving from the plaintiff, and on the ground that an inseparable part of the consideration is illegal as contravening public policy. In our opinion the stipulation of the railroad company to bear one-half the cost of maintaining the overhead bridges, when strengthened in such a manner as to provide for the increased burden of traffic caused by the operation of the traction road, furnishes a lawful consideration for the reciprocal stipulations of the traction company. The general duty of the railroad company to maintain those bridges arose from the fourteenth section of the general railroad law, as amended in 1801. P. L. 1891, p. 169; Gen. St. p. 2661. Aside from the liability to indictment for nonrepair, and the liability to damages at the suit of parties specially injured through such nonrepair, the only direct methods of enforcing the obligation of the railroad company were those prescribed by section 14. viz., either by proceedings in chancery at the instance of the municipal authorities to compel specific performance of the duties imposed upon the company, or by action of those authorities in proceeding to repair the bridges on the company's default so to do, recouping the cost from the company by action at law. It is not necessary now to question whether the continuing obligation of the railroad company to keep up the bridges in accordance with the growing demands of travel extends to their reinforcement and maintenance under the extraordinary weight of trolley tracks and roadbed and the operation of trolley cars. Assuming that to be so, the traction company was still (in the absence of agreement of the railroad company) left in the situation of a member of the general public having a great practical interest in the proper performance of this public duty by the railroad company, but without direct means of its own to specifically enforce such performance, and without redress for nonperformance unless it should be specially damnified. Under these circumstances, an agreement settling as between these parties that they would equally bear the expense of maintaining the improved bridges, and giving to the traction company the right to do the repairs and charge one-half the cost to the railroad company, tended to avoid litigation between the parties about the matter, and had such value to the traction company as to furnish consideration for its reciprocal stipulations. With the adequacy of that consideration we are not in this action concerned.
For like reasons it seems to us that the consent of the railroad company to the grade crossings, and its stipulation to share in the expense of maintaining the same, furnish a valuable consideration to the agreement. But that consent and stipulation are attacked as void in law and contrary to public policy, in that they contravene the provisions of the act of 1895 for regulating the crossing of steam railroads by steam or electric railroads thereafter to be constructed. P. L. 1895, p. 462; Gen. St. p. 2717. That act declares in substance that "whenever the route of any steam or electric railroad shall cross at points outside of the limits of cities the line of any steam railroad, such crossing shall be made in such a way as will indict the least injury upon the rights of the company owning or operating the railroad...
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