Western Union Telegraph Co. v. Chicago & Paducah Railroad

Mr. Justice Sheldon delivered the opinion of the Court: The defense set up against the bill is, that the alleged contract was never executed by the railroad company, and is not binding upon it. The statute of frauds is also set up ; and that the contract should not be enforced, as being against public policy. The draft of contract in the case was not actually signed by the railroad company, and it is contended that Plumb had no authority to make such a contract for the company. This being admitted, still the fact appears that Plumb, the vice-president and general manager of the railroad company, by his letter to the telegraph company, expressly accepted, with one exception, which was acceded to, the terms named in the draft of contract. In reliance upon this as an acceptance of the contract by the railroad company the complainant went on and made large expenditure in the completion of the line of telegraph, the railroad company furnishing the labor and material required by the contract. After the completion of the line, the telegraph business was conducted thereon for a year and more by both parties, and requisitions for telegraph supplies and applications for franks for the free telegraphing were made by the railroad company and furnished by the telegraph company in all respects according to the terms of the contract. All this while there was no dissent or objection whatever by the railroad company to any of the terms of the contract, except at about the end of the time, as to the unimportant particular of the connection of the Chicago railroad office with the line. The expenditures which the telegraph company was thus induced by the conduct of the railroad company to make in the completion of the line and the subsequent carrying on of operations upon it were not upon the understanding of a revocable license to place their wire upon the poles; but they were upon the terms and conditions of the contract, as securing to the telegraph company rights in respect of the telegraph poles, and carefully guarding them against interference and injury on the part of any other telegraph company. The property of the complainant is upon the line, placed there under those terms and conditions. The contract named that the poles are to be furnished for the telegraph company. In view of all the acts of acquiescence, and adoption, and recognition by the railroad company, of the terms of the contract, we can have no doubt that they should be held binding upon the company, although it did not formally execute the contract. And we are of opinion that, under the terms of the contract, appellant’s rights in respect of the line of poles in question are exclusive as regards any other telegraph company, so far as physical interference or injury may result from placing upon the poles an additional wire by another -company. As respects the statute of frauds, we regard the acceptance of the contract .by the letter of Plumb as a sufficient signing within the statute. McConnell v. Brillhart, 17 Ill. 354 ; Cossitt v. Hobbs, 56 id. 231. Also, that the contract is taken out of the statute by the mutual execution of its terms and provisions, on the principle of part performance. The objection to the contract on the ground of public policy is, that it gives to the appellant the monopoly of the •telegraph business along the line of the railroad company. However it might be as to the provision of the contract in this respect, taking it in its full extent of an exclusive right of way, and the discouragement of competition, in so far as it goes only to the exclusion of competitors from the line of poles occupied by complainant when direct injury to the actual working of complainant’s line of wire might result, it is not, in our view, liable to this objection. So long as any other company is left free to erect another line of poles, we see no just ground of complaint on the score of monopoly, or the repression of competition. As to the liability of interference with, and injury to, complainant’s line of wire from the placing on the poles of an additional line by another company, many experts are examined on both sides, and their testimony upon the subject is very conflicting. A large number of them testify that there is great practical difficulty in working two lines of wire upon the same set of poles when the wires are under the management of distinct companies, and give their opinion that there would be liability of serious annoyance, inconvenience* and injury to complainant’s line of wire from the additional wire on the same poles; and some of them support their opinion by statement of actual results which have followed in instances named. We think a case is presented entitling the complainant to the relief prayed, so far as respects the placing and maintaining a wire upon the poles in questiou by the defendant telegraph company. That company is fully chargeable with notice of the rights of the complainant. It virtually admits that it was put upon inquiry in regard to them ; stating, in its answer, that it was informed by the railroad company that the line of wire which had been placed upon the poles by the complainant-was under a parol understanding in the nature of a revocable license. It should not have stopped with the railroad company in making inquiry. Eesort should have been had to the complainant, as the proper source of information in, respect to its rights. The decree will be reversed, and the cause remanded for-further proceedings conformable to this opinion. Decree reversed.