Shaver v. Pennsylvania Co.

• Decision Date: 28 January 1896
• Citation: 71 F. 931
• Parties: SHAVER v. PENNSYLVANIA CO.
• Court: U.S. District Court — Northern District of Ohio

71 F. 931

SHAVER v. PENNSYLVANIA CO.

United States Circuit Court, N.D. Ohio, Western Division.

January 28, 1896

Scribner Waite & Wachenheimer, for plaintiff.

E. W Toleston, for defendant.

RICKS District Judge.

This suit was originally instituted in the court of common pleas for Lucas county, and, by due proceedings had, was removed by the defendant, which is a nonresident corporation, to this court. The plaintiff sues to recover for damages, because of certain negligence of the defendant and its agents in failing to have properly filled the space between the ties at a certain junction or cross-over, in said county, by reason of which plaintiff's foot was caught while undertaking to uncouple cars. There are certain other acts of negligence charged in the petition, which it is not necessary here to consider. Plaintiff claims permanent injury, and damages in the sum of $25,000. To this petition the defendant filed an answer, which, after denying the negligent acts charged in the petition, set up, as a third defense, that said plaintiff, at the time he received the injuries complained of, was a member of the Voluntary Relief Department of the Pennsylvania Lines West of Pittsburgh; that said Voluntary Relief Department is an organization formed for the purpose of establishing and managing a fund, known as a 'relief fund,' for the payment of definite amounts to employes contributing to the fund, who under the regulations are entitled thereto, when they are disabled by accident or sickness, and, in the event of their death, to their relatives or other beneficiaries specified in the application for insurance; that said relief fund is formed from voluntary contributions of the employes of the road, from contributions given by said defendant, the Pennsylvania Company, when necessary to make up any deficit, from income or profits derived from investments, or profits of the moneys of the fund, and such gifts and legacies as may be made for the use of the fund. The regulations governing said Voluntary Relief Department require that those who participate in the benefits of the relief fund must be employes in the service of the Pennsylvania Company, and be known as members of the relief fund. Defendant further answering, says that no employe of the company is required to become a member of said relief fund; that the same is purely voluntary; that any one who has become a member may withdraw at any time, upon proper notice that contributions from such members cease by so withdrawing. The defendant further says that participation in the benefits of such relief fund is based upon the application of the beneficiaries; that on the 3d day of January, 1894, the plaintiff in this case, being in the employ of the defendant company, applied for membership, and in said application agreed to be bound by the regulations of the said fund. Defendant further says that the application for membership was approved and accepted at the office of the superintendent of the relief department, and that thereupon said plaintiff became a member of said relief fund. Defendant further says that, when said plaintiff received the injuries complained of, he thereupon became entitled to the benefits growing out of his membership in said relief fund, by reason of the injury so received while in said service; that said plaintiff thereupon immediately applied to said department for such benefits, and received monthly payments therefrom, amounting in all to the sum of $399, until the commencement of this action, on the 25th of May, 1895. Defendant says that the plaintiff, in his application for membership, expressly agreed that, should he bring suit against either of the companies now associated in the administration of the relief department for damages on account of injury or death, payment of benefits from the relief fund on account of the same shall not be made until such suit is discontinued, of if prosecuted to judgment or compromise, any payment of judgment or amount of compromise shall preclude any claim upon the relief fund for such injury or death. Defendant says that, the plaintiff having commenced suit against the defendant, payments to the plaintiff for the benefits accruing under said contract were suspended; and defendant says that by virtue of the agreement aforesaid, and the acceptance by the plaintiff of the benefits from said relief fund on account of said injuries, the said defendant thereupon became discharged for any and all liability to the plaintiff on account of said injuries. The plaintiff has demurred to this answer. He contends-- First, that the contract set up in the answer is invalid; and, next, that it is in violation of an act of the legislature of Ohio passed in 1890, in 87 Ohio Laws, p. 149.

There are two questions to be determined upon the demurrer thus interposed. The first question is whether this contract between the plaintiff and the defendant is a valid one. The case, as presented to the court, rests entirely upon the pleadings. No evidence is before me, and the allegations of the defendant's answer are to be accepted as true by the plaintiff having demurred thereto. It therefore becomes important to emphasize the facts thus admitted. They are that the plaintiff voluntarily became a member of this relief department, with full knowledge of its rules and regulations. The answer further distinctly avers, and the demurrer admits it, that, by his application in writing to become a member of such relief department, the plaintiff agreed that the acceptance by him of benefits from the relief fund, for injury or death, should operate as a release of all claims for damages against said defendant arising from such injury and death. It will be observed that it is the acceptance of benefits from this relief fund which, by the agreement, releases the railroad company from a claim for damages. If the employe injured does not accept such benefits, but chooses to sue for damages, his right of action is unimpaired, and in no respect waived. This is the case as presented by the pleadings and admitted facts. It is not the question of whether a railroad company, by contract with its employes, can exempt itself from suits for personal injuries caused by its negligence. That, as a general rule, cannot be done. This case does not present that question, neither does it present an issue of fact as to whether this contract for insurance is a voluntary one or not. If the pleadings and evidence in a case should show that an employe entered into such a contract, ignorant of its terms, or when under restraint or duress or compulsion, the court would then be authorized, and it would be its duty, to inquire into that fact, and relieve against any wrong of that nature. But, as before stated, no such question is now in any way presented. The pleadings do not even suggest such an issue. The sole question is whether, under the admitted facts already stated this contract is valid. There are decisions of the supreme courts of the states of Iowa, Maryland, Pennsylvania, and of state courts in Ohio, and of circuit courts of the United States in Ohio and Maryland, holding such contracts legal and binding. Under this plan, employes of railroads are afforded protection by a species of insurance. This sort of protection is not available to them in ordinary insurance companies, except at such high cost as to make it substantially unobtainable. Members sick or injured are entitled to benefits, regardless of what causes their temporary disabilities. They will thus receive benefits in cases where no claim against the railroad company could be made. They could receive benefits, also in cases where the injury was the result of their own contributory negligence, or of that of fellow servants in the same department of service, in both of which cases, as a rule, no right of action would arise against their employer. Now, if employes desire to enjoy the benefits of such contracts, they should have the right to make them. They are capable of deciding for themselves whether they want to contract for such protection. It is not within the powers of a legislature to assume that this class of men need paternal legislation, and that, therefore, they will protect them by depriving them of the power to contract as other men may.

It may be instructive to quote from some of the decisions heretofore referred to, declaring similar contracts valid. In the case of Johnson v. Railroad Co., 163 Pa.St. 127, 29 A. 854, the facts were that William B. Johnson, the plaintiff, was a brakeman, employed by the Philadelphia & Reading Railroad Company, and, while in said employ became a member of the Philadelphia & Reading Relief Association. He made a voluntary application to become a member of that association, among others, upon the following conditions:

'And, in consideration of the contribution to be made by the Philadelphia & Reading Railroad Company to the funds of the association, I agree that acceptance of benefits from said relief fund for injuries or death shall operate as a release of all claims for damages against said company, my employer, arising from such injury or death, which could be made by or through me; and that I or my legal representatives will execute, or, where necessary, procure to be executed by others, such further instrument as may be necessary formally to evidence such acquittance.'

The case resulted in a verdict for the defendant in the court below, and the supreme court (Justice Mitchell speaking for the court) said:

'It is further objected-- and this is the only substantial question in the case-- that the release was void, as against public policy. * * * In this case there is no provision exempting the company from liability for future negligence. The benefits, by the

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