ORDELHEIDE v. WABASH R. CO.

(Supreme Court of Missouri, Division No. 2, June 9, 1903.)

[75 S. W. Rep. 149.]

Railroads Liability for Fires-Contract to Hold Harmless-Public Policy.*

A contract by a railroad company to relieve itself from liability for fire in a building, communicated thereto by its negligence, is not against public policy; not being with a passenger or shipper, or in regard to a contract of carriage.

Appeal from Circuit Court, Montgomery County; E. M. Hughes, Judge.

Action by E. F. Ordelheide against the Wabash Railroad Company. The St. Louis Court of Appeals reversed a judgment for plaintiff, and on a dissent of one of the judges the cause was transferred to the Supreme Court. Judgment of circuit court reversed.

Geo. S. Grover, Geo. Robertson, and G. Pitman Smith, for appellant.

A. H. Drunert, J. D. Barnett, H. W. Johnson, and C. W. Wilson, for respondent.

GANTT, J. This appeal is in this court by virtue of a dissent of one of the judges of the St. Louis Court of Appeals. It was argued and submitted, but, owing to the fact that a case growing out of the same fire was pending in the court in banc, it was deemed best to await the opinion of the whole. court on some of the questions involved in both appeals. The opinion of the court in banc will be found reported in Wabash R. Co. v. Ordelheide, 72 S. W. 684.

The pleadings and agreed statement of facts upon which this case was determined in the circuit court and Court of Appeals are fully set out in the opinion of Judge Bland in the St. Louis Court of Appeals, 80 Mo. App. 357, and we adopt the same, as follows:

"The petition is as follows:

"Plaintiff states that the defendant is a corporation duly incorporated under and by virtue of the laws of the state of Missouri, and was at the time of the grievance hereinafter mentioned, as such corporation, the owner and occupier of a certain railroad, together with depots, switches, side tracks, and facilities for receiving and unloading freight, stock, and goods, which said railroad runs through the counties of Warren and Montgomery, in the state of Missouri, and, as said corporation, was at said time operating, working, managing, and running its said railroad by its agents, servants, and employees, and using thereon its locomotives, engines, cars, and trains; that on or about the 6th day of April, 1895, the plaintiff was the owner of a certain building, used as a

*See notes at end of case.

Ordelheide v. Wabash R. Co

warehouse, elevator, or grainhouse,. together with horse power, belting, and all appliances and machinery necessary and required to run, work, and operate the same, which said building, with the said horse power, belting, appliances, and machinery therein, stood adjoining or near by the depots, switches, side tracks, at or near the defendant's station or depot at Wright City, in said Warren county, all of which was of the value of two thousand dollars; that on or about said date the defendant so carelessly and negligently operated, worked, run, and managed its said railroad, and carelessly and negligently used thereon defective and insufficient locomotives and engines, and so carelessly, negligently, and unskillfully operated, worked, and managed and run its locomotives, engines, cars, and trains on its said switches, railroad, and side tracks, that fire escaped from its locomotives and engines, and was communicated to plaintiff's said building, warehouses, elevator, or grainhouse, and the same, together with said horse power, belting, and appliances and machinery therein as aforesaid, were damaged and destroyed, to plaintiff's damage in the sum of two thousand dollars. Wherefore, by reason of the premises, the plaintiff says he is damaged in the sum of two thousand dollars, for which and costs of suit he asks judgment.'

"Defendant answered as follows:

"Now comes the defendant in the above-entitled cause, by its attorneys, and, for its answer to the petition of plaintiff therein filed, admits that it is, and was on the 6th day of April, 1895, a corporation duly incorporated under and by virtue of the laws of the state of Missouri. Defendant denies each and every other allegation contained and set forth in plaintiff's petition. For other and further answer to the petition of the plaintiff, defendant says that on or about the Ist day of November, 1892, the plaintiff herein entered into a certain written and printed agreement with the defendant for the lease of certain ground then belonging to the defendant in Warren county, Missouri, in said agreement described, for the purpose of erecting thereon a certain grainhouse, said agreement expiring, under its terms, on or about the 31st day of October, 1897, which said agreement was in words as follows, to wit:

""This agreement, made and entered into this first day of November, A. D. 1892, by and between the Wabash Railroad Co., party of the first part, and E. F. Ordelheide, of Wright, in the county of Warren, and state of Missouri, party of the second part.

"""""Witnesseth, that the said party of the first part, for and in consideration of the sum of one dollar per annum, in advance, to said party of the first part paid by said second party, and upon the express condition and stipulation that said second party shall assume all risk of fire from every cause, and shall hold and keep harmless said first party from any and

Ordelheide v. Wabash R. Co

all damages whatsoever, from fire or any other cause, to any building or buildings that may be erected on the land herein. leased, or their appurtenances or contents, which guarantee enters into and forms part of the consideration that induces said first party to make this lease; and for the further covenants and agreements hereinafter contained on the part of the second party to be kept and performed, hereby grants unto the said second party the right to occupy and use for the purposes of grainhouse, the following described part of the grounds of the said party of the first part, at Wright, county of Warren, and state of Missouri, to wit: At a point on the west line of South street, twenty-three (23) feet north of the center of the Wabash main track; thence northward along the south side. of South street forty-five (45) feet to the north line of Wabash right of way; thence westward along the right of way line one. hundred and ten (110) feet; thence southward at right angle thirty-eight (38) feet to a point seven and one-half (7) feet north of the center of the Wabash house track; thence eastward parallel to the house track, and seven and one-half (71) feet from the same, to the point of beginning.

66666

"""And said first party further covenants to and with said second party, that said second party shall have the right to occupy and use such portions of land, selected and designated as aforesaid, for the location of said grainhouse, for and during the full term of five (5) years from the date of this agreement, unless the occupancy of said premises shall be sooner terminated in the manner hereinafter provided.

"""And the said second party covenants and agrees with the said party of the first part, to pay all taxes that may be assessed on said grainhouse and the herein leased premises, and to conduct the business of storing and forwarding grain or other property, according to such rules as the party of the first part may prescribe in relation to such business at its stations generally.

"""And the said second party hereby further agrees for himself, his heirs or assigns, that they hereby assume all risk of fire, from any cause whatsoever; that if any insurance is effected during the continuance of this lease or any renewal thereof by said second party, or any party interested therein, on said grainhouse or the contents thereof, that said second party will, before such insurance is effected, exhibit this lease. to the agent or agents, officer or officers of the insurance company or companies through whom said grainhouse is to be insured, and procure the endorsement hereon of said agent or agents, officer or officers, and also upon the policies of insurance issued by them or any renewal thereof, to the effect that said insurance company will not, under any circumstances, bring or cause to be brought any claim or action at law against the party of the first part, its successors or assigns, for damages occurring during the term of this lease, or any renewal thereof, by fire or otherwise, to the said grainhouse or

Ordelheide v. Wabash R. Co

appurtenances erected on said land, or to the contents thereof.

"""And it is hereby mutually agreed between the parties hereto, that in case said grainhouse shall, at any time during the continuance of this agreement, be destroyed by fire or otherwise, the contract shall not cease and determine by reason thereof, but the said second party shall be allowed thirty (30) days within which to rebuild the same; and in case the said grainhouse shall not be, by said second party, rebuilt in all respects equal to one so destroyed, within thirty days from the time of the destruction by fire or otherwise, then this contract shall, at the option of the party of the first part, cease and determine, and be no longer binding upon the parties thereto.

""And the party of the second part also further agrees with the party of the first part, that he will remove said grainhouse from off the grounds of said party of the first part at any time during the aforesaid term of five years (5) after having received from the said party of the first part days' notice to do so.

"""And the party of the first part agrees to recognize said grainhouse as the property of the party of the second part, and permit him to remove the same, at any time, from the premises of the party of the first part.

"""And it is also expressly understood between the parties hereto, that at expiration of the time mentioned for the continuance of the right herein granted to the second party, the said second party shall have reasonable time for removing said grainhouse from off the ground of the party of the first part, said removal to be at the expense of said second party; and till such removal, the provisions of this lease regarding damages occasioned by fire, or otherwise, shall remain in full force and virtue.

"""And said second party hereby agrees that he will not sublet said leased land nor assign nor transfer this agreement without the consent in writing of the general manager of the party of the first part, endorsed hereon, and subject to all the conditions, covenants, limitations and restrictions of this lease, and that he will use said leased land for no other purpose than that contemplated by the terms of this contract. """And the said second party hereby further agrees to paint all buildings erected by him on the herein leased premises a color in conformity with the uniform color established by said party of the first part for its buildings generally. """And it is distinctly understood and agreed between the parties hereto that in case the second party shall make default in any of the covenants on his part, to be kept and performed, or shall insure said grainhouse on said leased land without procuring the endorsement hereon, as hereinbefore provided in that respect, then in that case it shall and may be lawful for the said first party, its assigns, suc

Ordelheide v. Wabash R. Co

cessors, agent or attorney, at its election, to declare this agreement at an end, and into or upon said premises, with the said grainhouse and appurtenances hereon or any part thereof, to enter with or without process of law, and the said second party or any persons accupying said premises and said grainhouse or appurtenances, to expel, remove and put out, using force as may be necessary for that purpose, and occupy and possess said premises, and hold and occupy the grainhouse and appurtenances thereon till they can be removed or the conditions of this lease shall have been complied with by said second party; but no action or proceeding under this paragraph by the party of the first part shall in any manner release the party of the second part from the obligations and duties assumed as regards damages occasioned by fire, or otherwise, as provided for in this agreement of lease."'

"Further answering, defendant says that, for the various considerations named in said agreement, the plaintiff herein agreed to assume, and by said contract did assume, all risk of fire to his property then or thereafter to be located upon defendant's land as aforesaid, from any cause whatever, and that under said agreement, for said consideration, the plaintiff further assumed all risk of fire from every cause, and undertook and agreed to hold and keep harmless the defendant from any and all damages whatsoever from fire or any cause to any building or buildings that might be erected upon said land, or their appurtenances and contents. Wherefore defendant says that plaintiff ought not to have or maintain this case, and, having fully answered, prays to be discharged, with its costs.'

"The issues were submitted to the court on the following agreed statement of facts, to wit:

"It is hereby agreed by and between the parties hereto as follows:

"First. That the property sued for is correctly described in the petition, and was of the value therein stated, and was destroyed by fire on the day, at the place, and in the manner alleged in the petition.

"Second. That the lease between the parties thereto, E. F. Ordelheide and the defendant, Wabash Railroad Company, dated on the 1st day of November, 1892, running five years. from the date thereof, was executed by said parties as therein set forth, and that a correct and true copy of said lease is set out in the defendant's answer herein, and proof thereof is hereby dispensed with in this case.

"This agreement shall constitute a part of the record in the above-entitled cause, and may be introduced in evidence. in support of a demurrer, motion to strike out, reply, or other pleadings to be hereafter filed by the plaintiff in said cause, or upon trial thereof.''

The petition alleges and the agreed statement of facts