Railway Co. v. Fire Ass'n

Battle, J., after stating the facts as above. 1. Foreign corporations doing business in this State. It is contended in behalf of appellant that the demurrer , filed by it should have been sustained because it was stated in the complaint that the plaintiffs were foreign corporations, and did business in the State of Arkansas. This is true, but it was not alleged that the contract of insurance made by them was entered into in the State of Arkansas, and hence it was not necessary to state in the complaint that the plaintiffs had complied with the conditions upon which they could do business and had the right to make the contract in this State. Until it otherwise appears, the law presumes it was not made in violation of the statutes or constitution of this State. Fry v. Bennett, 28 N. Y., 324, 330; Chatauque Co. Bank v. Risley, 19 N. Y., 369, 381; Farmers' Loan and Trust Co. v. Clowes, 3 Comst., 470; Boulware v. Davis, 90 Ala., 207. Inasmuch, then, as it was not shown in the complaint that the contract of insurance was made in Arkansas, and the fact should be that it was and that it depended for its validity upon the compliance of appellees with the conditions upon which foreign corporations are permitted to do business in this State, the appellant could not have taken advantage of it by demurrer, but should have done so by answer, as in that case it would have been a matter of defense. Christian v. American Freehold Land Mortgage Co., 89 Ala., 198. 2. when answer waives-other defenses, The defendant in its answer, without showing that the 1 . _ , . contract in question was made in this State, alleged that the plaintiffs had no right to maintain this action, because they had not complied with the act of the general assembly of the State of Arkansas, entitled “An act to prescribe the conditions upon which foreign corporations may do business in this State,” and approved April 4, 1887. The ground of its demurrer was, “ The complaint did not state facts sufficient to constitute a cause of action.” But it does not affirmatively appear that the authority of the plaintiffs to make contracts in this State was questioned by the defendant until its answer was filed. Taking it for granted that the contract was made in the State of Arkansas, the presumption is that, in undertaking to show in its answer why the plaintiffs could not transact business here, it stated all the grounds upon which it could attack their right to do so, and that, by the answer, it abandoned its demurrer in that respect. While their authority to make the contract of insurance, if a question, was a question of fact, it based its. whole defense in that respect upon the failure of the plaintiffs to comply with the act of April 4, 1887. Had it alleged in its answer that the contract was made here and that the plaintiffs had failed to comply with the other statutes or constitutional provisions regulating their right to do business in this State, it may be the defense could have been met and overcome by proof to the contrary. Hence the appellant will not be permitted to call their compliance with such laws in question in this court for the first time. Guin v. Mortgage Co., 8 So. Rep. (Ala.), 388; Robinson v. Insurance Co., 51 Ark., 441, 446. 8, Effect o 1 ■act of Apiii 4. 1887. - If the contract in question was made in this State, was it 1 necessary for appellees to comply with the act of April 4, 1887, in order to constitute it a valid contract? Certainly not. If the act of April 4th be applicable to foreign insurance companies in any case,* it certainly did not affect the contract in question, because the contract was made and the cotton was burned before it was enacted. 4. Right oi foreign corporation to sue. Appellees, notwithstanding they are foreign corporations, have a right to litigate in the courts of this State, without complying with the constitutional and statutory provisions which regulate their rights to do business here, because the institution and prosecution of a suit are not doing business, within the meaning of such provisions. Christian v. Mortgage Co., 89 Ala., 198; Guin v. New England Mortgage Co. (Ala.), 8 So. Rep., 388; 2 Morawetz on Corp., sec. 662, and cases cited. The court properly refused to instruct the jury to find for the defendant in the event they believed that the plaintiffs had not complied with the act of April 4, 1887. 5. When insur» anee company subrogated to assured's rights. The contract of insurance being valid, and the Fire Association having paid the amount of the loss sustained by the burning of the cotton insured, it thereby became subrogated to the assured’s right of action against the person or corporation who wrongfully caused the fire and loss, to the extent of the amount paid. This right of action acquired by the Fire Association does not depend on any contract or privity existing between the assured and the person responsible for the loss. But it grew out of the contract of insurance, and is derived from the assured alone. By that contract the insurer undertook to indemnify the assured against loss. The wrongdoer, in the order of ultimate liability, was primarily liable for the loss. Both were responsible to the assured. The loss for which they were responsible was one and the same, and the assured was entitled to but one satisfaction. It had a right to demand and receive payment of the loss from the insurer by virtue of its contract, as it did, without seeking to recover it of the wrongdoer. As it did so and received payment of the insurer, the wrongdoer was not thereby discharged from liability, but the insurer succeeded to and became entitled to the assured’s rights to relief against him to the extent of the amount paid as an indemnity, he being primarily liable; and the assured holds the claim against him in trust for the insurer. In other words, the insurer became subrogated to the assured’s right of action against the person primarily liable, to the extent of the loss paid. It took nothing but the rights of the assured, and can enforce them in its right only. If the assured had no right of action, none passed to the insurer. St. Louis, Iron Mountain & Southern Ry. Co. v. Commercial Union Ins. Co., 139 U. S., 223, and cases cited; Gales v. Hailman, 11 Pa. St., 515; Hart v. Railroad Co., 13 Met., 99, and cases cited; Swarthout v. Chicago & Northwestern Ry. Co., 49 Wis., 625; Bean v. Atlantic Ry. Co., 58 Me., 82; Peoria Ins. Co. v. Frost, 37 Ill., 333. The case of Insurance Co. v. Brame, 95 U. S., 754, cited by the appellant, is wholly unlike this. In that case the plaintiff insured the life of one McLemore, a citizen of Louisiana, for the amount of $7000, in favor of third parties. On the 24th of October, 1875, while the policy of plaintiff was in force, in the State of Louisiana, Brame, the defendant, wilfully shot and killed McLemore. A part of the policy was paid. The plaintiff insisted that the killing was an illegal and tortious act on the part of Brame, and caused damage to it in the amount of its policy. The court held that, inasmuch as at common law no civil action lies for an injury which results in death, and injuries to the person abate by death, and inasmuch as the statutes of Louisiana, where the homicide was committed, gave no right of action to any one for damage to the person in case of the death of the person injured, except to the minor children and widow of the deceased, and, in default of these relations, to the surviving father and mother, and inasmuch as the relation between the insurance company and McLemore was created by a contract between them to which Brame v<ras not a party, and the injury inflicted by him upon McLemore was a personal injury and McLemore died, the plaintiff had no right of action against Brame and could not recover. The E. B. Ward, 16 Fed. Rep., 255, 258. In this case the insurance company is not entitled to recover, if at all, in its own legal right, but under the equitable doctrine of subrogation, applicable to cases “wherein a party, who has indemnified another in pursuance of his obligation so to do, succeeds to, and is entitled to a cession of, all the means of redress held by the party indemnified, against the party who has occasioned the loss.” This doctrine was not applicable to the Brame case. Conn. Ins. Co. v. N. Y. R. Co., 25 Conn., 265. 6. When evidence not prejuThe appellant objected to the introduction at the trial of the written agreement by the Commercial Company with the Fire Association as evidence. But we are unable to see any force in this objection, since the latter became subrogated to the right of action of the former against any other party who caused the loss, without any formal assignment by the assured of his claim against such party. It did not prejudice appellant by showing the loss paid, as the uncontradicted evidence was that the damage to the cotton by the fire was equal to the amount paid by the insurance company. Was the railroad company responsible for the loss? The principal question in the case is, Should the instructions as to negligence asked for by the- defendant and refused by the court have been given ? The answer to the former depends on the answer to the latter question. 7, when owner of property burned not guiiry negligence, The instructions were to the effect that it was contributory negligence per se for the Commercial Company to place cotton near appellant’s railway on a private platform where it was exposed to danger and so close to passing engines that it was in danger of being ignited, and to leave it there without watch or guard over it. We think the court properly refused to give such instructions. The fact that the cotton in question was placed on a platform where it was exposed to danger did not cause the owner to forfeit the protection of the law. The cotton was placed on a platform constructed near the track of the railroad for the purpose of receiving freight for shipment, and where the railroad company had been receiving cotton. The owner had the right to place it there, and in doing so did not lose its right to compensation for its destruction or damage occasioned by the negligence of the appellant. Cook v. Champlain Co., 1 Denio, 91; Grand Trunk R. Co. v. Richardson, 91 U. S., 454; Kalbfleisch v. Long Island R. Co., 102 N. Y., 520; Longabaugh v. Virginia City R. Co., 9 Nev., 271; Pittsburgh, etc., R. Co. v. Nelson, 51 Ind., 150; Brown v. Atlanta, etc., R. Co., 19 S. C., 39; Pittsburgh, etc., R. Co. v. Noel, 77 Ind., 110; Gulf, etc., R. Co. v. McLean, 74 Texas, 646; St. Louis, etc., Ry. Co. v. Hecht, 38 Ark., 357; Kellogg v. Chicago, etc., Ry. Co., 26 Wis., 223; Philadelphia R. Co. v. Hendrickson, 80 Pa. St., 182; Snyder v. P. C. & St. L. Ry. Co., 11 W. Va., 14, 37; Philadelphia R. Co. v. Schultz, 93 Pa. St., 341; Pittsburgh, etc., R. Co., v. Jones, 86 Ind., 496; Richmond & Danville R. Co. v. Medley, 75 Va., 505; Louisville R. Co. v. Richardson, 66 Ind., 43; Burke v. L. & N. R. Co., 7 Heisk., 451; 1 Thompson, Neg., pp. 168, 169; 2 Shear. & Red. on Neg. (4th ed.), secs. 680-682, and cases cited. 8. Liability of railroad for damages by fire. When an owner places his property near the track of a railroad in an exposed and hazardous position, he assumes the risk of fire following the proper and lawful use of locomotives. The more combustible his property is or the more hazardous the position, the greater is the risk he assumes. But he does not assume the risks of the neglect of the railroad company. He is under no obligation to anticipate that and to provide against it. If, in the lawful use of his property, he exposes it to danger, he does not thereby lose his remedy for damage by fire occasioned by the culpable negligence of the company. Before he can do so, he must be guilty of some wrongful act or culpable negligence which contributed to produce the injury, and neither can be affirmed of the owner in the case supposed. Cook v. Champlain Co., 1 Denio, 91; Philadelphia R. Co. v. Hendrickson, 80 Pa. St., 182; Alpern v. Churchill, 53 Mich., 607; Philadelphia R. Co. v. Schultz, 93 Pa. St., 341; S. C., 2 Am. & Eng. R. Cases, 271; B. & M. R. Co. v. Westover, 4 Neb., 268, and the cases cited above. The rule releasing the defendant from liability on account of the contributory negligence of the plaintiff is limited to cases where the negligent act or omission of the plaintiff contributes to produce the loss as a proximate cause, and not as a remote cause or mere condition. In order to avail the defendant anything, “ there must be, not only negligence on the part of the plaintiff, but contributory negligence, a real proximate causal connection between the plaintiff’s negligent act and the injury, or it is no defense to the action.” There can be no reason in relieving the defendant from liability for the loss on account of the negligence of plaintiff, if the negligent act of plaintiff in nowise directly contributed to produce the injury. “ I may negligently leave my goods in a warehouse,” says Mr. Wharton, “but this is not the juridical cause of their destruction, if such destruction comes, not as a natural and usual result of my negligence, but through the negligence of another who sets fire to the warehouse. In other words, * * * my remote negligence will not protect a person who, by proximate negligence, does me an injury.” Flynn v. San Francisco R. Co., 40 Cal., 18; Kline v. Central Pacific R. Co., 37 Cal., 400, 406; Needham v. R. Co., id., 409, 417; Littleton v. Richardson, 32 N. H., 59; Norris v. Litchfield, 35 N. H., 271; Philadelphia R. Co. v. Hendrickson, 80 Pa. St., 182 ; B. & M. R. Co. v. Westover, 4 Neb., 268; Beach on Contributory Neg., secs. 10, 11; Wharton on Neg., sec. 324. The placing of the cotton on the platform by the Commercial Company was not the proximate cause of the loss in this case, but the fire Which consumed it. If the fire was communicated by the locomotive of the railroad company, the liability of the company depends upon the care it used to prevent the accident. If it used the proper precaution and diligence to prevent the escape of fire from its locomotives it would not be, but if the loss was occasioned by its failure to use such precaution and diligence it would be, responsible, as in that case its negligence would have been the immediate cause of the fire. What proper precaution and diligence was it bound to use ? Railway companies, being authorized by law to use steam in the operation of their trains, are bound to use locomotive engines which are in use and are of the safest construction for protection against the communication of fire therefrom to property along the lines of their roads, and to supply them with the best approved appliances and contrivances used to prevent the escape of sparks and coals therefrom to the endangering of the property of others, and to use them upon the road with such care and diligence as would be exercised by skilful, prudent and discreet persons having the control and management of them, and a proper desire to avoid injury to the property along the road. The failure to use such locomotive appliances and contrivances, and such care and diligence, on the part of the companies, will be negligence, and will subject them to a recovery for damages occasioned thereby, provided they occur without the contributory negligence of the owner of the property injured or destroyed. B. & S. R. Co. v. Woodruff, 4 Md., 242, 257; F. & B. Turnpike Co. v. P. & T. R. Co., 54 Pa. St., 345; Jackson v. Chicago, etc., R. Co., 31 Iowa, 176; 2 Wood’s Railway Law, p. 1343, sec. 326; 2 Shear. & Red. on Neg. (4th ed.)r secs. 672, 673 ; 1 Thomp. on Neg. (2d ed.), sec. 872, and-cases cited. There was, therefore, no error in the refusal of the court to give the instructions as to negligence which were asked! by appellant, as before stated. The instruction asked for by the appellees and given by the court was substantially correct. 9. Practice as to re-opening case. But we do think the court erred in refusing to allow appellant leave to introduce the testimony of witnesses which was-discovered after the close of the evidence. At least four-witnesses, in behalf of appellees, had testified that they saw the cotton just before appellant’s train reached the platform- and saw no smoke or fire about it, and immediately after the-train passed saw the fire burning the cotton. Only one, in behalf of appellant, testified that she saw smoke arising from the cotton before the train reached the platform or passed the cotton. Appellant offered to prove by one of the witnesses, whose testimony it asked the privilege to introduce after the close of the evidence, that she saw smoke-arising from the” cotton when the train was about two hundred yards from it, and by another one of them that she-saw smoke arising from the cotton before the train reached it. This testimony was important to appellant, and was pertinent to the most material issue in the case. The witnesses-were present, and to have allowed them to testify could not have materially delayed the trial. The introduction of their testimony should have been allowed, subject to rebuttal or explanation by appellees. The refusal to allow appellant leave to introduce it was not a proper exercise of judicial1 discretion. Courts should exercise their discretion as to the admission of evidence, under such circumstances as this evidence was offered, for the advancement of the right and to-the end that justice may be done conformably to the laws. Meacham v. Moore, 59 Miss., 561; Smith v. State Ins. Co., 58 Iowa, 487; Meyer v. Cullen, 54 N. Y., 392; Owen v. O'Reilly, 20 Mo., 603; 1 Thomp. on Trials, sec. 348. Reversed and remanded for a new trial. Footnotes [*] See St. Louis, etc., Railway v. Commercial Ins. Co., 139 U. S., 223.—Rep.