Case ID: ohio-np_1/html/0213-01.html
Source: Caselaw Access Project
Author: {"author": "Dilatush, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

(Warren County Court of Common Pleas.)
    Charles C. Cox v. The Pittsburgh, Cincinnati, Chicago & St. Louis Railway Company.
    A voluntary contract between a railroad company and its employe, whereby the latter agrees in consideration of certain guarantees upon the part of the company and of certain benefits accruing to him by reason of his membership in the volutary relief department of the company, that if he elects to accept benefits when injured, he will not look to the company for damages therefor is valid. And in so far as the law of 1890, yol. 87, page 194, Ohio Laws, prohibits the making of such contracts it is unconstitutional.
    (Decided January, 1895.)
    On demurrer to second defense of answer.
   Dilatush, J.

This action is brought by Charles C. Cox against the Pittsburgh, Cincinnati, Chicago & St. Louis Railway Company to recover damages for personal injuries alleged to have been received by plaintiff while in the employ of defendant.

The petition sets forth the circumstances of the accident and the negligence of defendant which plaintiff claims creates the liability.

The answer filed by defendant sets up two«defenses. The first defense denies the allegations of the petition as to the defendant’s negligence or liability.

For the second defense to plaintiff’s petition, defendant says, that if it is chargeable with the negligent acts complained of (a fact which defendant wholly denies), nevertheless plaintiff ought not to maintain his action because of the second defense.

Then follow the averments as to the organization, support and management of what is styled “The Voluntary Relief Department of the Pennsylvania Lines West of Pittsburgh,” which association was formed July 1, 1879.

It appears from this second defense, that the voluntary relief department is an association of such employes of the Pennsylvania Lines west of Pittsburgh as choose to avail themselves of its benefits.

No person is eligible to membership unless he is an employe of the railway company, under forty-five years of age, and passes a satisfactory medical examination. Members are classed according to salaries received. The first class comprises those whose monthly pay is not more than $40.00 per month. Plaintiff belonged to that class.

No employe is required to join the relief department, and he may withdraw at any time upon giving notice.

When he does become a member, he authorizes his employer company to withhold from his monthly wages, contributions for the relief fund, which in the first class is seventy-five cents a month ; and this contribution entitles him during membership to benefits for disablement by accident, sickness or death.

The application for membership which applicants are required to sign contains this language :

“And I agree that the acceptance of benefits from the said relief fund for injury or death shall operate as a release of all claims for damages against said company arising from such injury or death, which could be made by or through me, and that I, or my legal representatives, will execute such further instrument as may be necessary formally to evidence such acquittance.”

“I also agree that this application, when approved by the superintendent of the relief department, shall make me a member of the relief fund, and constitute a contract between myself and said company” (being the employer company).

It appears from the answer that the employer company guarantees the safe keeping and interest on the funds of the association, furnishes necessary clerical force and office room for conducting the business of the association, and further agrees that if the dues from members fall within certain specified times to meet the liabilities of the association, the employer company-will pay the necessary amount. It is alleged that the defendant has paid on said guaranty the sum of $21.000 since the organization of the relief department.

The relief department is managed by a superintendent, subject to the control of the general manager of the Pennsylvania lines west of Pittsburgh, medical examiners and necessary clerical force. In addition, there is an advisory committee, consisting of the railway general manager, who is ex-officio a member and chairman of the committee, and twelve members, one-half of whom are chosen by the railway companies and the other half by the employes of said companies who are members of said relief fund.

The answer avers that on October 25, 1892, plaintiff, with full knowledge of the conditions, made his voluntary written application, containing the stipulation above mentioned, for membership in the first class of said relief department. That having passed a satisfactory medical examination, and the application being approved by the superintendent of the re lief department, the plaintiff on November 1, 1892, became a.member con tributing, and entitled to the benefits as provided by the regulations of said relief department.

That after the injuries received by plaintiff and for a period from May 6, 1898, to June 30,1894, he received as a member of said relief fund, the benefits to which he was entitled for his injuries, amounting to $196.25, with full knowledge on his part that he was not bound to accept the same, but that in so doing he released the defendant company from any claim for damages against it arising from the injuries received by him on or about May 6, 1893, and of which he complains, although he has received no benfits since June, 1894, pursuant to a regulation of the department, that if an injured member brings suit against his employer for injuries on account of which benefits are paid, the benefits cease until such time as said suit is discontinued, when payment of benefits will be resumed.

Wherefore defendant prays to be hence dismissed with its costs.

To this second defense in the answer of defendant, plaintiff files a demurrer. It is that demurrer which is now before the court for determination.

The demurrer raises two questions.

1st. The validity of the statute enacted in 1890 found in volume 87, page 149, Ohio Laws.

2nd. If the statute is void, then is the contract set forth in the answer against public policy ?

The provision of the statute applicable to the cause at bar is as follows :

And no railroad company, insurance society or association, or other person, shall demand, accept, require or enter into any contract, agreement, stipulation with any person about to enter or in the employ of any railroad company, whereby such person stipulates or agrees to surrender or waive any right to damages against any railroad company, thereafter arising, for personal injuries or death, or whereby he agrees to surrender or waive in case he asserts the same, any other right whatsoever, and all such stipulation and agreements shall be void, and every corporation, association or person violating or aiding or abetting in the violation of this section, shall for each offense forfeit and pay to the person wronged or deprived of his rights hereunder, the sum not less than fifty dollars ($50.00) nor more than five hundred dollars ($500.00) to be recovered in a civil action.”

The statute is evidently aimed at contracts like the one set up in defendant’s second defense in the answer.

The statute makes all such contracts void. Neither party can make a contract of this kind no matter how desirous both are to do so.

Counsel for defendant contends that this statute is unconstitutional, being a violation of section 1, article 1 of the Bill of Rights.”

“ All men are by nature free and independent, and have certain inalienable rights, among which are those of enjoying and defending life and liberty, acquiring and possessing and protecting property, and seeking and obtaining happiness and safety.”

These inalienable rights can not be taken away by legislation ; they are protected by the constitution. Back of the right to acquire property lies the right to contract, because, if a person can be deprived of the right to contract, he is injured in his right to acquire property.

Man’s labor is his property, and he has a right to contract in respect to it, and this right is protected by the constitution. Private corporations are regarded as persons within the meaning of the constitutional provisions, and have the same right, within the limits of their charter, as natural persons to acquire, possess and protect property. (25 Am. S. R. 863.)

The liberty of making contracts is absolutely essential to the acquisition, possession and protection of property. Hence, if the statute under consideration contravenes this liberty, it must fall as certainly as though-it was subversive of the citizen’s right to more tangible or corporeal property.

It is well known that the legislature can exercise certain control over and regulate by proper laws railroad and other corporations having public-duties to perform.

But this power is limited strictly to what is known as the police power of the state. Judge Coouey defining this power says:

“ The limit to the exercise of the police power in these cases must be-this: the regulations must have reference to the comfort, safety and welfare of society ; they must not be in conflict with any of the provions of the charter, and they must not, under pretense of regulation, take from the corporation, any of the essential rights and privileges which the charter confers. In short, they must be police regulations in fact, and not amendments of the .charter in curtailment of the corporate franchise.” Cooley’s Const. Lim. 819.)

Reyond these provisions the state cannot interfere with the dealings and contracts of such companies with their employes, who are sui juris, any further than it lawfullly can with those of other employers of labor.

The police power of the state extends to matter only affecting the public welfare, the health, safety and morals of the community. The Wheeling Bridge & Terminal Ry. Co. Gilmore, 8 C. C. R. 658.

Legislation under this police power is common, and when within constitutional limits, is upheld by the courts.

Such, for example, are the statutes regulating rates of fare, freight charges, speed of trains in cities, protection of public crossings, employment of children in factories, mines and theaters. These are within the legitimate exercise of police power by the state.

We must be careful, however, not to seek to sustain paternal legislation which is not within the limits of the constitution on the claim that it is an exercise of the police power.

In the present case, I am of the opinion that the portion of the statute applicable to this case is clearly unconstitutional. Iam unable to see that the contract, which by the statute is declared void, in any manner affects-the public welfare, or the health or morals of the community.

The second proposition advanced in support of the demurrer is that-this contract, set up in defendant’s answer, is against public policy.

Much that was heretofore said applies to the second proposition. If the contract affected the public welfare, it would be an appropriate subject for legislation, and if against public policy, the courts would not sanction it even in the absence of legislation.

Any contract whereby a corporation or an individual seeks to escape a liability it would otherwise incur, will be carefully scrutinized by the-court when called in question.

Counsel for plaintiff cited in support of their position the case of Michigan, Lake Shore & Southern Ry. Co. v. Spangler, 44 Ohio St. 471.

A careful consideration of the principles involved in that case brings us again to the primary fact, that the contract there set out was not stricken down because it injuriously affected the individual, but because it jeopardized the public.

The free citizen can take care of himself. If a fraud is perpetrated upon him in a contraet, he has his redress. In the absence of fraud, and for a good consideration, and lawful subject matter, not affecting the public, he can effectually bind himself by contraet in any manner chosen.

If the railway company was permitted to make contracts escaping liability for its negligence it would be less vigilant in employing careful and prudent men.

Reckless individuals, careless of their own safety, might seek employment, contracting away their own rights in advance, and the employment of such persons would increase the hazard to the persons and property of the public having business with the railroad company.

In the case at bar, if the contract provided that persons joining the relief department thereby surrendered the right to sue the company for negligent acts, causing injury, a different question would be presented. But such is not the case.

The relief department affords protection to a class of men for whom ordinary insurance is not obtainable, except at high cost. It seems to be entirely fair and just, and employes should be permitted to have its benefits, if they desire.

Members sick or injured are entitled to benefits regardless of what causes the sickness or inj ury.

If injured in such manner as to have a cause of action against the company, a member of this department is simply put to his election to determine whether to pursue the company, or rely upon the provision of the relief department. He can not do both. If fraud is perpetrated upon him in the matter of election, he may have relief under certain circumstances. No question of that kind, however, is presented in this demurrer.

I desire, in conclusion, to call attention to the case of Owens v. B. & O. R. R., decided in the U. S. Circuit Court for the Southern District of Ohio, and reported in 85 Federal Reporter, 715.

The syllabus is as follows : “ The by-law of a railroad relief association requiring its members to release the railroad company for any claim for damages before applyihg to the association for relief, is not against public policy, as it simply puts a claimant to his election whether he willlook to the railroad company or the relief association for compensation.”

The charge to the jury upon this'point, as delivered by Judge Sage, is as follows:

“It is urged that that was an illegal arrangement; that the law does not permit an employer to stipulate for immunity from the damages which his employes may sustain by reason of his negligence. That, as a general proposition, gentlemen, is well stated. That is the law. But it does not apply to this case for this reason : There is no stipulation that the members of the relief association shall not be at liberty to sue the Baltimore & Ohio Railroad Company for damages resulting from accidents attributable to the negligence of that company. If it were, that, in my opinion, would be an illegal stipulation. It would be against public policy. But the stipulation is, in effect, that when a member of the relief association, who is an employe of the Baltimore & Ohio Railryad Company (and no one else can be a member), sustains such injuries, he may make his election to sue the railroad company for damages, or, waiving that right, he may rely upon the benefits stipulated by the relief association. Now, that is perfectly legitimate and proper, and there can be no possible objection to it. I am unable to agree with counsel that the by-law applies only in cases of accident unaccompanied by negligence, and that a casualty resulting from negligence is not an accident. In a strict, technical sense, that, may be true in my opinion, in the sense in which the word is used in the by-laws of the association, because there would be no occasion for the release of a claim for damages, for injuries from an accident occurring without the fault or negligence of the railroad company inasmuch as in such a case no liability would be incurred by, or could be enforced against, the company.
“The manifest meaning of the by-law is that it applies to cases where the employe might maintain an action for damages against the railroad company.
“It puts him to his election. He can sue the railroad company, or he can take the benefits from the relief association. This is quite as legitimate as it is to settle claims of this character out of court by private negotiations, which is done constantly, and, if fairly done, nobody thinks of questioning it.”

W. F. Eltzroth and Albert Anderson, for plaintiff.

Charles Darlington, for defendant.

This, in my judgment, is an accurate and plain statement of the law, and applies to the case at bar.

The demurrer must be overruled.