Edgar Lumber Co. v. Cornie Stave Co.

Hart, J., (after stating the facts). It is earnestly insisted by counsel for appellant that the contract in question is illegal and void as being in restraint of trade. It is well settled that agreements by common carriers which interfere with the performance of their duties to the public are illegal and void as being contrary to public policy. 9 Cyc. 498. No one has a right to enter into a contract where the obligation imposed by it can not be performed by the other party without a violation of law; but we do not think the rule has any application to the facts adduced in evidence in the case at bar. While the tram road from Wesson west into the timber was a'standard gauge steam railroad, it was operated for private carriage. The undisputed evidence shows that the McDaniel Lumber Company built it for the express purpose of hauling its own logs to its sawmill. It was not chartered as a public carrier, and its owner and operator did not hold it out as such. It was operated as a private carrier, and as such its owner had the right to contract to haul exclusively for one person, firm or corporation. As a private carrier, it had a right to give a preferential rate to appellee in consideration of doing all its hauling. The evidence also shows that the spur track from Wesson to Cornie Junction was a private spur, and was not built for the use of the public. The railroad company did not operate its trams on the spur, and that it was built for the exclusive use of the lumber company is shown by the fact that when they ceased to use it the spur track was torn up.. It was attempted to establish the fact that the spur track was' operated as a common or public carrier by showing that the lumber company ran a motor car between Wesson and Cornie Junction in 1906 and 1907 for the purpose of carrying the mail and passengers, but the evidence does not show that any charge was made for their carriage. When it is remembered that the evidence shows that Wesson came into existence by the location of the lumber company’s sawmill, it may be inferred that this motor car was run for the convenience of the company and its employees. In any event the fact that the motor car for mail and passengers was run during the years 1906 and 1907 does not establish the fact that the spur was operated as a public carrier of freight. Indeed, the evidence establishes just the reverse. It shows that the spur track was laid for the exclusive private use of the lumber company, and that it was not operated as a public carrier of freight. In construing a contract in all essential particulars similar to the one in question; the Supreme Court of Virginia in the case of Merriman v. Cover, 104 Va. 429, held (quoting from syllabus) : “2. A contract in restraint of trade is valid when founded on a valuable consideration, if the restraint imposed is reasonable as between the parties and not injurious to the public by reason of its effect upon trade. Whether or not the restraint is reasonable is to be determined by considering whether it is such only as to afford a fair protection to the interests • of the party in whose favor it is given, and not so large as to .interfere with the interests of the public. Upon the evidence in the case at bar the stipulation by defendants as private individuals and owners of a steam railroad, engaged in private carriage, that no chestnut oak bark shall be shipped over their road except to the plaintiffs, unless they refuse to pay the market price therefor at their own or any other large tannery in that county, is reasonable as between the parties, and does not injuriously affect the public, and hence is valid.” It is next contended by counsel for appellant that the words “to their nearest connection with the Arkansas Southern Railroad,” as used in the contract, did not mean Cornie Junction, but that it meant Wesson. They insist that, if Cornie Junction had been -meant, it would have so stated in the contract by that name. Their contention has no argumentative force; for, as said by counsel for appellee, if Wesson had been meant, it would have been just as easy to have named Wesson in the contract. Indeed, the contention of appellee is more reasonable; for the line of the Arkansas Southern Railroad was located, and was not likely to be changed. The town of Wesson had a fixed location; and if the latter point had been meant, the parties would have used the word “Wesson,” instead of the words, “their nearest connection with the Arkansas Southern Railroad.” On the other hand, the lumber company prepared the contract, and may not have wished to name their point of connection as Cornie Junction for the reason that this would have compelled them to deliver at that point. They doubtless wished to use language that would enable them to change their point of connection with the Arkansas Southern Railroad during the life of the contract without committing a breach of it. This seems to -have been the interpretation placed upon the contract by the parties; for the cars were delivered at Cornie Junction until the spur track was torn up, - and then, by consent, the place of delivery was changed to El Dorado, and the contract as thus construed was carried out until the 16th day of July, 1908. Hence we think the parties are bound by their own construction of the contract as evidenced by their acts in performing it. It is next contended by counsel for appellant that it did not, by the purchase of the property of the McDaniel Lumber Company, -become liable to perform its contracts. This may be true, and still they are liable under the facts and circumstances in evidence. The evidence shows that the appellant purchased the entire property of the McDaniel Lumber Company in 1904, and its officers state that they found the contract in force and continued to perform it upon the same terms as provided in the original contract. They so continued to perform the contract until July 16, 1908, at which time they refused to further perform it. Their refusal was not based upon the ground that they were not liable to perform it, but was based upon a disagreement as to what was meant by its terms. This act itself was a recognition of the binding force of the contract. While the mere fact that appellant purchased the property of the Me-Daniel Lumber Company did not make it liable upon that company’s contract, yet, having accepted the contract and having undertaken to perform it according to its terms for the period of nearly three years, it may now be said that it assumed the contract. Having reaped the benefits of the contract for that length of time with a full knowledge of its terms and conditions, it is now estopped to deny liability under it. The judgment will therefore be affirmed.