Case Name: POE v. RAILROAD
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Decision Date: 1906-05-25
Citations: 141 N.C. 525
Docket Number: 
Parties: POE v. RAILROAD.
Judges: 
Reporter: North Carolina Reports
Volume: 141
Pages: 525–530

Head Matter:
POE v. RAILROAD.
(Filed May 25, 1906).
Damages for Death — flow Estimated — Annuity Act.
In an action to recover damages for injuries causing death, the court erred in permitting the jury to consider the provisions of chapter 347, Acts 1905 (the Annuity Act), for the purpose of ascertaining the present value of the intestate’s life.
ActioN by O. 0. Poe, Administrator of Willie E. Brown, against Raleigla & Augusta Air Line Railroad Company, lieard by Judge 0. 8. Ferguson and a jury, at tbe November Term, 1905, of tbe Superior Court of Chatham.
Plaintiff sued to recover damages of tbe defendant for negligently causing tbe death of bis intestate. Tbe negligence was admitted and tbe only question presented in tbe record relates to tbe question of damages. There was no objection to tbe general rule for tbe assessment of damages laid down by tbe court, but the defendant excepted because tbe court instructed tbe jury that tbe Legislature at its last session bad provided a table to be used, in ascertaining tbe present value of an annuity. Tbe court read chapter 347 of tbe Public Laws of 1905 to the jury and added: “These methods are submitted to you as a means by which you may calculate the present value of the net income which tbe intestate would have derived .from tbe labors, of bis life, if be bad not been killed.” Tbe court instructed tbe jury as to tbe rule of damages laid down in Watson v. Railroad, 133 N. C., 188, and also as to tbe method of ascertaining tbe present value of tbe life of tbe deceased as stated in that case.. There was a verdict and judgment for tbe plaintiff and tbe defendant appealed.
H. A. Dondon & Son for the plaintiff.
Day & Bell, Womaclc, Hayes & Bynum and Murray Alien for the defendant.

Opinion:
Walker, J.,
after stating tbe case: After giving full consideration to tbe able and ingenious argument of tbe plaintiffs counsel, we tbink tbe court erred in permitting tbe jury to consider tbe provisions of chapter 347 of tbe Acts of 1905 for tbe purpose of ascertaining tbe present value of tbe intestate's life. Tbe rule for estimating'tbe damages to be allowed, in sucb cases as this one, bas been long settled and we bave no idea that tbe Legislature intended by tbe chapter above mentioned to change the rule so firmly established. That act was intended to apply strictly to an annuity which bas a well defined meaning in tbe law. "An annuity is a stated sum payable annually unless otherwise directed. It is not income or profits, nor indeterminate in amount, varying according to tbe income or profits, though a certain sum may be provided out of which it is to be payable; and hence, wheji a testator gave a beneficiary tbe interest upon a certain sum, payable annually, it is not an annuity, but merely an ordinary legacy, for it is not a stated sum, but may be more or less according to the earnings of tbe capital and is merely interest or income." 1 Words & Phrases Judicially Defined, p. 405. "There is a distinction between income and annuity. The former embraces only the net profits after deducting all necessary expenses and charges. Tbe latter is a fixed amount directed to be paid absolutely and without contingency." Ibid. "Tbe income or interest of a certain fund (bequeathed) is not an annuity, but simply profits to be earned, and although directed to be paid annually, that relates only to the mode of payment and does not change tbe character of the bequest." Ibid. Bartlett v. Slater, 53 Conn., 102; Booth v. Ammerman, 4 Bradford, 129. The Act of 1905 provides a method by which, in connection with the mortuary table, the present cash value of an annuity may be ascertained. It recognizes tbe very distinction we have drawn between annuity and income, for in section 3 it provides that when a person is entitled to tbe use of a sum of money for life or. for a given time, tbe interest tbereon for one year may be considered as an annuity and tbe present cash value be ascertained as in tbe case of a strict annuity. But it will be observed that tbe amount, even in that case, is fixed as it is tbe interest for one year. In tbe first section, tbe act refers to a strict annuity, an invariable sum due by tbe year and payable annually, and in tbe third section it refers to a sum now in band and not one to be hereafter earned, as in our case. Tbe first section would seem to have provided for those cases where a certain and definite sum, unchangeable in amount, is given by one person to another to be paid annually, without regard to the fund out of which it is to be paid or to any interest of tbe annuitant in tbe capital, and tbe third section permits reference to tbe fund itself (at present in band), so far as it is necessary to ascertain, by tbe interest upon it for one year, what tbe annual sum to be paid shall be. But tbe entire act shows that it was not intended to apply to an income or to any other variable quantity. Tbe rule which tbe act prescribes is almost tbe exact opposite of that which this court has hitherto laid down as applicable to such cases as this one, and its consideration by the jury in connection with tbe latter rule would tend to confuse them, rather than enable them to determine more approximately or with greater accuracy than under tbe existing and long standing rule, tbe true value of tbe life in question. In ascertaining by tbe net income what is a fair and just compensation for tbe pecuniary injury resulting from the death, under Lord Campbell's Act, as it is called (Revisal, sections 59 and 60), we are dealing with'something not now in possession, but which is to be earned in tbe future, and, therefore, it is that this court has always kept said fact in view when formulating a rule for tbe assessment of damages in such cases. Tbe terms in which that rule has been framed imply necessarily that the net income will, or at least may, be a changeable quantity, a certain amount in one year and another and quite different amount in the next, as the jury are required by it to consider the capacity of the intestate to earn money, which may increase or decrease owing to his age and other circumstances, and the other elements which enter into the calculation under that rule are also of such a nature as to render the annual income of a series of years variable in amount. The total amount or net accumulated income, upon which the compensation is based, must be ascertained as of the time when, according' to his expectancy, the intestate would have died in due course of nature, but this total may be composed of many annual incomes of different amounts. The present value of that sum, whatever it may be, is what the jury should allow in the way of damages. This court has not prescribed any "hard and fast rule" by which to bind the jury in making the estimate of what sum should be given or to require them to make the assessment of damages in any particular way. A general rule for the guidance of the jury was suggested in Pickett v. Railroad, 117 N. C., 616, stating more definitely a proper method of calculation than was done in the previous cases of Kesler v. Smith, 66 N. C., 154, and Burton v. Railroad, 82 N. C., 504, the age, health, strength, skill, industry, habits and character of the deceased being, as then said, elements of importance to be considered in fixing the amount of compensation. That case was followed by Coley v. Statesville, 121 N. C., 301; Benton v. Railroad, 122 N. C., 1007; Mendenhall v. Railroad, 123 N. C., 275, and perhaps others, in all of which the general rule stated in Pickett v. Railroad was recognized and applied; the end of it all being to enable the jury to ascertain the net accumulated income which the deceased might reasonably be expected to have earned during the period of his expectancy, if death had not ensued. The charge of Judge O. H. Allen in Mendenhall v. Railroad, supra, which, was adopted by this court as containing a correct statement of the principle governing such cases, is commended as a safe one for guidance, coupled with the usual reference to the mortuary table. The rule was again considered in Watson v. Railroad, 133 N. C., 188, and approved. It was there suggested by the court that while the judge was not required to do so and his refusal so to do in that case was held not to be error, yet that he might with propriety have submitted to the jury the arithmetical rule contained in the defendant's prayer for instructions, as illustrative of the general method of measuring the damages. A review of all that has been said upon this subject leads us to the conclusion that no special formula has yet been prescribed as alike applicable to all cases and as one that should invariably be used in trials. The presiding judge may select, from the several forms which have been used, the one he may think will inform the jury of their duty in the premises, or he may. use his own form of expression for that purpose, the object at last being to assist the jury to arrive as near as may be at a correct estimate, and much, therefore, will depend upon the nature of the case and a great deal will be left to the intelligence and sound sense of the trial judge; but to introduce a new and foreign element into the computation, such as the annuity act, passed evidently for a different purpose, would tend to great confusion and render uncertain the rule which has been for many years, and is now, reasonably well understood. The present value of the net accumulated income to be ascertained upon the principles heretofore stated by this court in the cases cited, is the safest and best rule to be followed. Pickett v. Railroad, supra. We do not think this rule, long 'since adopted, has .been, or was intended to be, modified in the least by any subsequent legislation.
There was error in the charge of the court for which a new trial is awarded on the issue as to damages. The verdict as to the first issue will stand. It is not necessary to consider tbe other assignments of error as they become immaterial by our ruling and may not again be presented.
New Trial.