Salt River Valley Water Users' Ass'n v. Berry

• Decision Date: 28 October 1926
• Docket Number: Civil 2482
• Citation: 31 Ariz. 39,250 P. 356
• Parties: SALT RIVER VALLEY WATER USERS' ASSOCIATION, a Corporation, Appellant, v. J. T. BERRY, Appelle
• Court: Arizona Supreme Court

250 P. 356

31 Ariz. 39

SALT RIVER VALLEY WATER USERS' ASSOCIATION, a Corporation, Appellant, v. J. T. BERRY, Appelle

Civil No. 2482

Supreme Court of Arizona

October 28, 1926

APPEAL from a judgment of the Superior Court of the County of Maricopa. M. T. Phelps, Judge. Affirmed.

Messrs Kibbey, Bennett, Gust, Smith & Lyman, for Appellant.

Messrs Hayes, Stanford, Laney & Allee, for Appellee.

OPINION

ROSS, J.

J T. Berry brought this action against the Salt River Valley Water Users' Association for personal injuries alleged to have been suffered when his horse stepped into an open telephone hole left by defendant and fell, thereby throwing plaintiff to the ground, injuring his back and shoulders, his spinal column, spinal cord and spinal nerves, and his abdominal and thoracic viscera.

Defendant's answer consisted of a general denial and an allegation that plaintiff's injuries were caused solely by plaintiff's fault and negligence in this, that plaintiff knew of said hole and rode his horse carelessly and negligently upon and into the same.

The trial was by a jury. Verdict and judgment were for plaintiff. The defendant appeals from the order overruling its motion for a new trial and from the judgment. (The parties will be designated as in the lower court.)

Defendant complains that five prejudicial errors were committed by the trial court. We will consider these assignments separately in the order of their presentation.

The competency of certain of the jurors to serve was challenged by the plaintiff on the ground that they were stockholders of the defendant corporation and the sustention of such challenges is assigned as error. Eight jurors were excused over defendant's objection for the sole reason that they were stockholders of the defendant. The question is very fully and well presented. The contention that stockholders of defendant are not disqualified to act as jurors is based upon a line of decisions holding that taxpayers of a county, city or town are not disqualified to serve as jurors in a suit against such civic corporations. Recently, recognizing there was a conflict in the authorities on the question, we adopted the view that:

"Disbarring from a jury any representatives of the taxpayers of a community is far more likely to prevent a fair and impartial trial than that their remote interest in the result of the suit would, of itself, prejudice them." City of Prescott v. Sumid, 30 Ariz. 347, 247 P. 122.

This was an action for damages for personal injuries, and we held that a taxpayer's interest in the result was "so remote, indirect and slight that it may fairly be supposed to be incapable of affecting his judgment."

It is contended by defendant that its stockholders occupy the same position toward it that a taxpayer occupies towards his county, city, or town. But the relation a taxpayer sustains to his county, city, or town is not, ordinarily, a direct personal one; it is, rather, impersonal. He recognizes, as a matter of course, that it is his duty to contribute his proportionate share, whatever it is, to the legitimate current expenses of the municipal or quasi-municipal corporation of which he is a citizen member, and when such organization is sued he is more interested in seeing justice done than in the slight additional tax burden a judgment in such suit might be upon him.

Defendant was incorporated under the general laws to furnish water to 250,000 acres of land under the Salt River project. Its stockholders are the owners of irrigable land within the project and each of them has as many shares as he owns acres. Revenues for corporate purposes are raised by levying assessments on the stockholders, and such assessments are made liens on the lands of the members. The defendant is chartered as any other private corporation and exercises the powers common to such. True, it also exercises some powers in the matter of taxation common to governmental agencies. Orme v. Salt River Valley Water Users' Assn., 25 Ariz. 324, 217 P. 935; Greene & Griffin v. Salt River Valley Water Users' Assn., 25 Ariz. 354, 217 P. 945. But we do not think this would have the effect of changing the status of a stockholder into one of indifference as in the case of a taxpayer of a municipality. To allow stockholders of defendant to sit as jurors, when it is sued, is not unlike permitting the stockholders of a bank, or a railroad, or any other large corporation to act as jurors when such corporation is sued. The interest of the juror in the latter case is too apt to become identical with the interest of the stockholder.

"Interest, on the part of the juror, in the event of the action or in the main question involved in the action" is one of the statutory grounds of challenge for cause. Subdivision 5, par. 3558, Civil Code 1913. The legislative purpose of this provision was, no doubt, to insure a fair and impartial jury. It is very improbable that an interested party, such as a stockholder in a corporation being sued for damages, will be able to act with entire impartiality. Nor do we believe it would be safe to lay down a rule that because the amount sued for is small, compared with the wealth and resources of defendant, the latter's stockholders could be depended upon always to act fairly and impartially.

It seems to us the safe thing to hold is that every stockholder of a private corporation, or a corporation exercising the functions defendant exercises, is interested in the event of a suit brought against his company and therefore, upon challenge for cause, should be excused. We are not impressed with the argument of defendant that this will result in an unbalanced jury. While it will disqualify all the stockholders of the defendant (some 4,000 to 5,000) to act as jurors in actions to which it is a party, we think little trouble will be experienced in selecting a jury, unaffected by such interest, from a community in which the list of eligible jurors is approximately 30,000. Surely, jurors, a fair cross-section of the community, can be selected from a list so large with no suspicion that their verdict would be colored by their personal interests, and, if that is true, defendant has no real reason to complain.

It must be admitted that defendant is a private corporation engaged in a private enterprise for the pecuniary benefit of its stockholders. It is not a governmental agency. It was not organized under our irrigation district laws and does not operate under such laws. Because it has been permitted, from the necessities of the case, to exercise some powers of a governmental character with approval, it has not been thereby changed from a private to a public corporation. The law with reference to the competency of a stockholder of a private corporation to serve as a juror, when his company is sued, is the law that should be applied here. That rule is stated in 35 C.J. 315, section 326:

"A stockholder in a corporation is incompetent to act as a juror in a case in which the corporation is a party or has any pecuniary interest."

See, also, 16 R.C.L. 274, section 91; Sovereign Camp of Woodmen of the World v. Ward, 196 Ala. 327, 71 So. 404; Seeherman v. Wilkes-Barre Co., 255 Pa. 11, 99 A. 174; Spinney's Admx. v. Hooker & Son, 92 Vt. 146, 102 A. 53; Citizens' Light, Heat & Power Co. v. Lee, 182 Ala. 561, 62 So. 199; Edmonds v. Modern Woodmen of America, 125 Mo.App. 214, 102 S.W. 601; Murchison Nat. Bank v. Dunn Oil Mills Co., 150 N.C. 683, 64 S.E. 883; Featherstone v. Lowell Cotton Mills, 159 N.C. 429, 74 S.E. 918; Putnam v. Pacific Monthly Co., 68 Or. 36, Ann. Cas. 1915C 256, 45 L.R.A. (N.S.) 338, L.R.A. 1915F 782, 130 P. 986; on rehearing, 68 Or. 54, Ann. Cas. 1915C 256, 45 L.R.A. (N.S.) 338, L.R.A. 1915F 782, 136 P. 835; Martin v. Farmers' Mut. Fire Ins. Co., 139 Mich. 148, 102 N.W. 656.

Defendant complains that the evidence showed plaintiff's negligence was the proximate cause of his injury, and that therefore the court erred in its refusal at the close of plaintiff's case, and at the close of the whole case, to direct a verdict and in not granting defendant's motion for a new trial on that ground.

Whether there was any foundation for these motions, of course depends upon the evidence. It showed that, at the time of the accident, plaintiff was living on a farm, near Tempe, along and by which there was a public highway, the middle sixteen feet of which was paved, the rest (twenty-five feet on each side) being unpaved; that the defendant and the Mountain States' Telephone Company each had telephone lines along and in the highway and on the west side of the pavement by plaintiff's farm-house, and extending beyond in a southerly direction for about a mile; that in August, 1924, both telephone lines were taken down and the telephone poles removed, and a new line erected by the Mountain States' Telephone Company for their joint use; that the Mountain States' Telephone Company filled some of the holes caused by the removal of its line of poles, but that defendant left the holes caused by the removal of poles on its line unfilled and open; that these holes were about one hundred and forty feet apart for a distance of four-fifths of a mile along the highway in a southerly direction from plaintiff's farm-house; that the holes were about fifteen inches across and three feet deep and in the right of way of the public road; that on October 10, 1924, plaintiff, while driving his dairy herd (about eighty head) along the highway and on the unpaved part thereof, in attempting to cut out of his herd two cows belonging to someone else, was thrown to the ground when his horse stepped into one of the holes left open by defendant; that his horse was trotting when it stepped into the hole; that plaintiff was watching the cattle at...