text:
    Bernard Fichter, Appellant, v. Milk Wagon Drivers’ Union, Local 753 of the International Brotherhood of Teamsters et al., Appellees.
    Gen. No. 41,278.
    Heard in the second division of this court for the first district at the June term, 1940.
    Opinion filed November 28, 1941.
    Rehearing denied December 10, 1941.
    Friedman, Hutler & Topper, of Chicago, for appellant; Russell J. Topper, of Chicago, of counsel.

      David A. Riskind and Abraham W. Brussell, both of Chicago, for appellees.
   Mr. Presiding Justice Scanlan

delivered the opinion of the court.

Plaintiff sues to recover disability and sickness benefits in the sum of $3,193. A jury returned a verdict finding defendants not guilty. Plaintiff appeals from a judgment entered upon the verdict.

Plaintiff became a member of the Union in the spring of 1920 and on June 15, 1928, he was involved in an accident as a result of which he claims he sustained permanent injuries to both legs. At the time of the accident there were in full force and effect bylaws adopted by the Union in 1922, which provided, inter alia, that a member in continuous good standing for not less than three months prior to the date of the commencement of his illness was entitled to disability benefits in the sum of twenty dollars weekly, to continue for and during the entire period of his illness provided the illness was of at least fourteen days’ duration. Section 74 of the by-laws provided: “This Constitution and By-laws can be amended as follows: Any three members may over their signature, present to the union, at any regular meeting, any amendment or alteration to this constitution, and after being read at two regular meetings, shall lay over to the next regular meeting when it shall be voted upon. If the amendment or alteration receives a two-thirds vote it is adopted.” From June 22, 1928, to October 5, 1937, the Union paid plaintiff sick benefits weekly in sums ranging from twenty and thirty-five dollars weekly, the amount paid depending upon the size of his family at the time of the payment. A new set of bylaws was adopted by the Union on December 12, 1935, that went into effect on January 1,1936. The new bylaws “cancelled and superseded all previous by-laws and alterations pertaining to the sick and death benefits,” and omitted the provision in the 1922 by-laws relating to the payment of disability benefits. The new by-laws provided that sick benefits shall be twenty dollars per week; that after a member has been a member for one year he shall be entitled, in case of sickness, to no more than a maximum of twelve weeks of sick benefit after the first year; “and each additional year, up to and including the tenth year of continuous service, will entitle member to an additional twelve weeks of benefit. After ten years continuous employment, in good standing, the member will be entitled to sick benefit the full time he is sick.” After the new by-laws went into effect plaintiff was notified by the Union that in accordance with the new by-laws he was entitled to benefit payments for only ninety-two weeks more; that the Union would carry him for ninety-two weeks more and “then he would be done.” Plaintiff thereafter received from the Union benefit payments of twenty dollars a week for ninety-two weeks. At the time of the last payment he accepted from the Union a withdrawal card. That these payments to plaintiff were made by the Union in accordance with the provisions of the new by-laws is clear from the proof.

This brings us to an important question raised upon this appeal. Plaintiff contends that “a trade union is without power to adopt subsequent By-Laws binding upon pre-existing members whose rights have already vested; the right of a member to disability benefits vests the instant the disability commences,” and continues as long as the disability lasts.

Defendants contend that ‘ Sections 41 and 42 of the 1936 amendments to the by-laws regarding sickness benefits, which reduced the amounts payable and which fixed the conditions upon which any benefits were to he paid, were valid and binding upon all Union members including Fiehter,” even though he was still disabled at the time of the adoption of the said amendments; that “under Section 74 of the hy-laws of 1922 . . . the hy-laws could be subsequently amended by two-thirds vote of a regular meeting of the members”; that “a labor union, under the analogy of cases involving mutual benefit associations, has a right to amend its by-laws in the manner expressly provided for in its original by-laws in force at the time the claimant became a member provided the subsequent amendments are not arbitrary or unreasonable”; that “under the analogy of the mutual benefit association cases, the fact that Fichter was disabled in 1936 did not preclude the Union from complying with the terms of Section 74 as it existed in 1920 or in 1922, and in accordance therewith amending the disability and death benefit provisions”; and that “the 1936 amendments did not violate any ‘vested right’ of Fiehter’s membership. ’ ’

We will first refer to cases cited by plaintiff in support of his position:

In Becker v. Berlin Beneficial Society, 144 Pa. 232, the by-laws of the Beneficial Society provided that a sick and disabled member was entitled to $3.50 a week if confined to his bed and required the attention of a nurse, and that he should receive $2.50 a week if his disease was of a less serious character yet so as to incapacitate him from following and prosecuting his professional business, “said weekly allowance to continue until a restoration to full health, or death, as the event may happen.” “The plaintiff became a member of the society in 1855, and continued thereafter a member in good standing. Being disabled by sickness in 1887, he received benefits from the society at the rate of two dollars and fifty cents per week, down to March 1, 1888, and from that date to March 1, 1889, at the rate of one dollar per week. After the last-mentioned date, he received nothing from the society, although, down to the date of bringing this suit, his condition of health was such as to incapacitate him from following and prosecuting his professional business. This suit was brought to recover the difference between the amount the plaintiff had received as a beneficiary, and the amount he claimed he was entitled to receive.” On January 6, 1888, the society adopted an amendment to its by-laws which provided that the weekly disability benefit be one dollar per week. At the close of the testimony the defendant requested the court to charge (p. 233): “The plaintiff as a member of the corporation defendant was bound by the amendments to its by-laws reducing the amounts of sick benefits, and was not entitled to receive any larger sum, after the date of the respective amendments, than was therein provided; and if the jury find from the evidence that plaintiff, at the time he brought suit, had received all that was due him under said amendments, he cannot recover in this case.” The court (p. 234) “refused the foregoing point, pro forma, and instructed the jury to find for the plaintiff, reserving the question of law ‘whether the defendant corporation had the power, under its charter and constitution, to adopt the amendments passed January 6, 1888, and March 1, 1889, and thereby bind the plaintiff.’ ” The jury returned a verdict in favor of the plaintiff for $158. The defendant then filed a motion for judgment non obstante veredicto. The trial court held that “these amendments were not binding on the plaintiff; (a) because the method of their adoption was illegal; and (b) 'because, even by a lawfully adopted by-law, he could not be deprived of vested rights, ’ ’ and entered a judgment for plaintiff upon the verdict. The defendant appealed. The short opinion of the upper court follows (pp. 234, 235): “Per Curiam: We think the learned judge below took the correct view of this case. Briefly stated, it is as follows: Some time after the defendant society became liable to the plaintiff for dues at the rate of two dollars and fifty cents per week, and after it had paid them for more than one year, it proceeded to amend its by-laws so as to reduce the amounts of benefits. This was certainly an easy mode of relieving the society from an obligation, and if successful, will doubtless be followed by other similar associations. The difficulty in the way of this convenient mode of paying debts is that it is repudiation pure and simple. The argument that the plaintiff, being a member of the society, is bound by the by-law, does not meet the difficulty. It may be a good by-law as to future cases, but at the time it was passed the plaintiff was something more than a member. He was a creditor whose rights had previously attached, and those rights cannot be swept away by such a scheme as this by-law. Since the above was written, our attention has again been called to the case of St. Patrick’s Benef. Soc. v. McVey, 92 Pa. 510. That case, however, does not conflict with this, for the reason that the resolution to suspend the weekly payment of benefits was passed before McVey became entitled to benefits as a sick member. He was a member of the society at the time, and bound by the resolution. There was no attempt to deprive him of benefits after the society became chargeable therefor.”

In Maheu v. L’Union Lafayette, 98 Atl. (Me.) 821, the court was called upon to decide a question of law based upon an agreed statement of facts. The decision is a short one and we quote it in full: “The agreed statement shows that the defendant is a fraternal benefit association, whose principal object is to establish by monthly contributions by the members ‘a benefit fund for sick associates, and after their death for the heirs.’ The plaintiff is a member. It does not appear that any benefit certificate was issued to him. But at the time he became a member, under the by-laws, sick members were entitled to benefits at the rate of $5 a week for 13 weeks in each year. After the plaintiff became ill, and after he had received $325 as sick benefits, the defendant amended its by-laws so as to limit the total amount any sick member would be entitled to receive to $325, or $5 a week for 65 weeks. And the defendant, relying* upon the amended by-laws, refuses to pay any more sick benefits to the plaintiff. The plaintiff contends that the amendment, adopted after he became ill, does not affect his rights. We think the plaintiff’s contention must be sustained. We are not called upon to consider the general question whether a fraternal benefit society may, by amendment of its by-laws, increase its assessment rates, or reduce its sick or death benefits, so as to affect existing members. The authorities seem to be divided irreconcilably on this question. The leading case in support of the power is Reynolds v. Royal Arcanum, 192 Mass. 150. The leading case opposed is Wright v. Maccabees, 196 N. Y. 391. The question here is whether after a member has become ill, and his right to sick benefits has attached, the society can defeat his right and repudiate its existing obligation by amending its by-laws. If so, it is an easy way to discharge liabilities. We think it cannot. Such an amendment is wholly unreasonable and void, as respects liabilities already incurred. Becker v. Berlin Beneficial Society, 144 Pa. 232, is exactly in point. Judgment for plaintiff. Damages to be assessed at nisi.”

In Crnic v. Croatian Fraternal Union of America, 89 S. W. (2d) (Mo.) 683, there was presented, inter alia, a question similar to the one presented in Becker v. Berlin Beneficial Society, supra, and Maheu v. L’Union Lafayette, supra. The court, in passing upon the question, said (pp. 690, 691): “If the amendatory sections to plaintiff’s [defendant’s] by-laws should be given effect to defeat plaintiff’s action under his respective petitions herein as is further contended for by defendant, it would be to allow defendant by legislative action to defeat a vested interest of plaintiff as a member to benefits under the by-laws of the order in force at the time his sickness and total disabilities were incurred and suffered, which is shown to have been July, 1929. Plaintiff at that time became entitled, under defendant’s existing by-laws, to benefits to be paid him therefor as then provided by the laws of the order. It appears that, on July 30, 1929, at the time plaintiff became sick and totally disabled, on account of which he now seeks a recovery of benefits at that time provided by defendant’s by-laws, he was paying to defendant dues which entitled him to receive sick benefits at the rate of $14 per week for the first year and $10 per week thereafter until he recovered. He had a vested interest in and to such benefits. To permit defendant, after such right had become vested, by amendatory by-laws or otherwise, to change the benefits in any manner to which plaintiff had become entitled would be to permit it to change and nullify the contract entered into with plaintiff and take away from plaintiff a substantial right conferred by the contract of membership itself. This .it cannot be permitted to do. . . . [Citing cases.] To allow such is not covered by an agreement of the member to abide by and comply with and perform all the duties imposed by the by-laws, rules, and regulations of the order in force or that might thereafter be adopted, changed, or modified. Defendant’s contention with respect to the availability of the amendatory sections of its by-laws effective October, 1932, as a defense herein must therefore be denied.”

In Dotlich v. Slovene Nat. Ben. Society, 228 N. W. (Minn.) 608, the plaintiff was suing to recover disability benefits where payments had been made for some period of time by the society and then after the enactment of a subsequent by-law it deprived plaintiff of all benefits and refused to continue the payments. The court, after referring to the agreement of the members to be bound by the existing by-laws and those that might thereafter be enacted, said (p. 610): “Does this permit an amendment of the by-laws such as is here involved and which entirely stops and cuts off plaintiff from receiving benefits which he would have received if the by-law had not been adopted? We think not.” In the Dotlich case the defendant claimed that as it was an Illinois corporation the laws of Illinois controlled the question before the court, and argued that under the Illinois rule plaintiff was bound by the amendment to the by-laws. But the court stated (p. 610) that “if the.Illinois law and decisions are to be considered, we believe that in that state a by-law such as is here involved, under the facts in this case, would not be held valid,” and the court further stated that they could find no Illinois case that indicated otherwise.

We will now refer to cases cited by defendants in support of their position:

Floyd v. Medroes, 55 R. I. 163, was an action of assumpsit brought for the sum of $300 which the plaintiff claimed the Cigar Makers’ International Union of America owed her as the beneficiary of a death benefit or life insurance payable by reason of the death of her grandfather, a member of the Union.. The question involved was whether there was any contract for such death benefit or life insurance in force between the Union and plaintiff’s grandfather at the time of his death on December 22, 1933. The following excerpt from the opinion of the court shows, we think, that that case has no application to the instant question (p. 169): “At the time when Mr. Floyd became a member, there was no provision whatever for death benefits nor was there at the time of his death. During most of the intervening time there was such a provision, which varied according to the condition of the union, financial and otherwise, and was at all times subsidiary to the main purpose of the union. There was no evidence that he ever made any application for a benefit certificate for the payment of a death benefit, or that he ever had any such certificate, issued by the union, or that there was ever any definite or express contract for the payment of any death benefit. It is our conclusion that he had only such rights as the constitution of the union provided from time to time for the members of his class, and that these rights, so far as death benefits were concerned, could be changed or annulled at any time by any change made in the constitution by the union, in accordance with the provisions for amendment contained in the constitution itself.. This conclusion is strongly supported by the opinion of this court in Grant v. Providence Permanent Firemen’s Relief Association, 53 R. I. 201, and the cases cited therein. As there was at the time of Mr. Floyd’s death no provision in the constitution of the union for the payment of a death benefit, the plaintiff has no right to recover any such benefit by reason of his death, and we see no reason for setting aside the decision of the trial justice to that effect.”

In Quigley v. Locomotive Engineers’ Mut. Life & Accident Ins. Ass’n, 279 N. Y. S. 858, the plaintiff sued as beneficiary under two life insurance certificates issued to her father, Patrick Quigley, by defendant, a mutual protective and fraternal benefit society. The certificates were originally issued to Quigley in 1883. The constitution and by-laws of the defendant were made a part of the contracts. There came a time when defendant’s by-laws were amended to provide that certificate holders who had paid their assessments for forty years were to have their certificates paid up for life and plaintiff’s father received paid-up certificates in place of those originally issued to him, and it was upon these later certificates that plaintiff sued. In 1933, defendant, claiming to find its business on an unsound actuarial basis, again amended its by-laws so as to provide that holders of paid-up certificates must again pay assessments in order to keep their certificates alive as obligations of the defendant, but to certificate holders sixty years of age or more there was given by the amended by-laws an option of surrendering their old certificates and taking new paid-up certificates for a fraction of the amount of their old ones. The upper court held that the evidence clearly showed that Quigley exercised the option to take paid-up insurance for one-half the amount of his old paid-up insurance on a nonassessment basis and surrendered to the defendant his old paid-up certificates, but that he died before defendant could issue the new certificates to him. The court held that the equities were with the defendant.

Sammel v. Myrup, 12 N. Y. S. (2d) 217, is not applicable to the instant case. There the defense was based upon a by-law in existence at the time of the member’s admission to membership.

As to Faso v. La Cerdese Com. Vito La Mantia Society, 156 N. Y. S. 1090, the record before the court of review was incomplete. For instance, the particular by-law upon which the plaintiff was claiming did not appear in the record. The defendant was an Italian benefit society and its certificate of incorporation provided that it was formed “for the purpose of voluntarily assisting the members of the said corporation, in case of sickness,” etc. The complaint alleged that plaintiff was entitled to the benefits of the “relief fund,” to be paid from the “funds of the corporation.” The answer of the defendant alleged that a resolution was unanimously carried, on October 10, 1914, that: “Owing to the fact that the society had no funds in the treasury out of which claims for sick benefits could be paid that all such payments be suspended for a period of six months beginning on the 22d day of October, 1914. ’ ’ The evidence showed that the society had no money that could be applied to the payment of the sick benefit. The opinion states (p. 1092): “It seems to me that a corporation which is authorized to give only voluntary assistance to its members must be held to have implied power to suspend a by-law providing for sick benefits payable out of its funds whenever its funds are depleted. See Lewin v. Koerner Benevolent Society, 125 App. Div. 91, 109 N. Y. Supp. 101.” (Italics ours.) It will be noted that the society was not attempting to avoid payment entirely but was merely seeking a suspension of payments for a period of six months. The reviewing court did not enter judgment for defendant but reversed and remanded the cause for a new trial.

Defendants place great reliance upon Grant v. Providence Permanent Firemen’s Relief Ass’n, 53 R. I. 201, but we think that case is clearly distinguishable from the instant one. The defendant association was organized for the purpose of aiding sick and disabled Providence firemen. The plaintiff became a member of the Providence fire department in 1892. In 1912, while in the performance of his duties, he was severely injured and totally incapacitated from performing his duties as a fireman. In 1913 the city retired him as a fireman and placed him on the city pension list. Defendant, as required by its constitution, paid plaintiff two dollars per day from the day he was injured until he was retired on a pension and thereafter one dollar per day until April 24, 1922, when the article in its constitution creating benefits for sickness or injury was amended by adding thereto a clause providing that no member should receive benefits “for any disability which does not prevent him from doing some kind of remunerative work.” Defendant then ceased its payment to plaintiff and the latter sued to recover the amount he alleged was due him up to August 21, 1927. Plaintiff admitted that his injury did not prevent him from doing some kind of remunerative work after the passage of the amendment, but he contended that the defendant could not extinguish his right by amending its constitution. The Rhode Island court stated (pp. 202, 203): “Plaintiff had no express or implied contract with defendant. His rights rest upon its constitution. Defendant’s right to amend or repeal any of the provisions of its constitution was expressly reserved. The article creating benefits for injured members contains no clause prohibiting its amendment, modification or repeal. Defendant never agreed that its constitution would not be modified so as to change the conditions under which payment of benefits would be made. Defendant ivas organised for the purpose of aiding sick and disabled members. If a disabled member recovered and resumed remunerative work, the reason for aiding him ceased. The amendment was necessitated to avoid paying benefits when they were no longer needed. There is no suggestion that the amendment was not reasonably necessary in order to conserve the funds of defendant and enable it to carry out the beneficent purpose for which it was incorporated.” (Italics ours.) When Grant joined the association he knew that his right to receive benefits for injuries rested upon the constitution of the association, and that defendant’s right to amend or repeal the provision of the constitution in question was expressly reserved in the constitution. At the time the constitution was amended Grant was receiving a pension, had remunerative employment, and his claim that he should also be paid disability benefits was clearly an unconscionable one.

In Stohr v. San Francisco Musical Fund Society, 22 Pac. (Cal.) 1125, the court held that where both the general laws of the State and the by-laws of an incorporated society give it the right to repeal, alter or amend its by-laws it is not a breach of contract for such society to amend a by-law which provides that in case of sickness a member shall be entitled to receive ten dollars per week by limiting such allowance to a certain number of weeks thereafter although a member be sick at the time of such amendment. No case is cited in support of the ruling and the decision seemed to turn upon the court’s conclusion as to what constitutes a vested right. However, in the Stohr case the by-laws provided for a ten dollar weekly sick benefit but failed to specify the exact period for which the payments were to be made, and this indefiniteness seems to have been a factor in the decision, as the court said (p. 1126): “The cases where a specific sum becomes due upon the happening of a certain event, as upon death, are not like the present. In such cases an alteration in the contract cannot be made after the fact; for that would be to make that not due which had already become due. We are inclined to think that the foregoing would apply if the by-law under consideration had specified that the weekly payments tuere to continue as long as the sickness continued. But it does not so specify.” (Italics ours.) The Minnesota Supreme Court, in Dotlich v. Slovene Nat. Ben. Society, supra, in considering the Stohr case, regarded the language we have just quoted and italicized as very significant. In the case before us the by-laws, upon which plaintiff relies, provide that the sick benefits “will be paid for the entire period of illness, minus the first seven days.”

In Pain v. Societe St. Jean Baptiste, 172 Mass. 319, the court held that a beneficiary association, organized under the statutes, which has reserved the power to amend its by-laws without limitation or restriction, may so amend them as to affect the right of a member to future benefits under a disability existing when the amendment is made. The court quotes with approval from an English case the following (p. 322): “Where . . . the original contract . . . provides for alteration of the rules, he is bound by any subsequent alteration that may be made within the power of alteration, whatever the extent of that alteration may be.” The Pain case holds that there was practically no limit to the society’s power to amend its by-laws. The court admitted that the doctrine it announced was inconsistent with decisions of some of the other States. The leading American case cited in support of its ruling is Stohr v. San Francisco Musical Fund Soc., supra. That the Supreme Court of Massachusetts later considered that the doctrine announced in the Pain case was too broad, see Newhall v. American Legion of Honor, 181 Mass. 111, opinion by Mr. Justice Oliver Wendell Holmes. Furthermore, the Pain case is distinguishable from the instant one because Pain had consented to be bound by any after enacted by-laws. As stated in the opinion (p. 322): . . plaintiff had agreed that these changes duly made in compliance with the rules of the society should be binding upon him, not as a new contract, but as a part of the old contract and under its provisions.” The same situation is present in the case of Fugure v. Mutual Society of St. Joseph, 46 Vt. 362, also cited by defendants.

Defendants cite Jenkins v. Talbot, 338 Ill. 441, but that case relates only to the power of a benefit society to increase the rates of assessment, and change the plan of assessment.

We are of the opinion that the weight of authority is against defendants’ position, and we hold that the 1936 amendments to the by-laws were not absolutely binding upon plaintiff. Undoubtedly the Union would have the right to cease paying the benefit payments to plaintiff under certain circumstances, for instance, if he withdrew from the Union, if he recovered from his disabilities, or if he recovered sufficiently from his dis-. abilities so that he would be able to resume remunerative work. The next contention of defendants involves certain other circumstances that the Union maintains gave it the right to cease payments after the last of the ninety-two payments had been made.

Defendants contend that “plaintiff’s conduct in accepting and acquiescing in the 92 payments after notification that these were his last payments in accordance with provisions of the 1936 amendments, and his acceptance of a withdrawal card on October 5, 1937, when he received what he knew was to be the last payment, showed an implied contract to conform to the benefit provisions of the 1936 by-laws. . . . His knowledge of the last payment, his recognition of the purpose of a withdrawal card as stated on its face, his conversation with the union official at the time, his apparent recognition that he no longer was in the union, his failure to object — all of these viewed with the light of the surrounding circumstances certainly warrant a reasonable man in concluding that Fiehter knew he was withdrawing from the union”; that “at the very least whether or not this ‘ratification’ constituted a new contract was a question of fact for the jury.” Plaintiff’s answer to this contention is: “There is no evidence in the record to show that the benefits paid to plaintiff after January 1, 1936, were made pursuant to and in accordance with the by-laws of 1936, and that plaintiff knew of such fact; that the only evidence in the record in anywise relating to this factor is that of the plaintiff wherein he testified that he received notification of a change of by-laws in January of 1936, and that he was to receive only ninety-two more payments; that nowhere does it appear by documentary evidence, i.e., written notice to plaintiff, records of the Union, or oral evidence of Robert Fitchie [president of the Union] and Steve C. Sumner [its secretary and treasurer] that the payments were made pursuant to and in compliance with the new bylaws ; that there was no evidence to show that plaintiff knew or had reason to know that the payments were regulated by the new by-laws; that the record indicates that the series of payments, were made at the same place, by the same people, in the same amounts and under conditions similar to those existing under the by-laws of 1922.” While plaintiff argues that under the evidence it should be held as a matter of law that he did not agree, expressly or impliedly, to conform to the benefit provisions of the 1936 by-laws, he also argues that “the burden of proof is upon it [defendants] to establish this affirmative defense,” and further argues that “the verdict and judgment is clearly and overwhelmingly against the manifest weight of the evidence.” The undisputed evidence shows that shortly after January 1, 1936, the Union notified plaintiff of the changes in the by-laws and that he would be entitled under the new by-laws to benefit payments for only ninety-two weeks more; that the Union would carry him for ninety-two weeks more and that then he “would be done.” The evidence further shows that under the new amendments a member was entitled to twenty dollars a week; that plaintiff never made any objections to anyone connected with the Union regarding the changes in the benefit payments to him; that after he received the notice he received, weekly, a check for twenty dollars and receipted for the same without making any objection or protest; that for ninety-two weeks he received from the Union a check for. twenty dollars a week, the amount fixed in the 1936 by-laws; that he cashed all of the checks; that from 1928 to the time the amendments went into effect he had received from the Union at least twenty-two dollars a week and sometimes as high as thirty-five dollars a week; that on October 5, 1937, plaintiff went to the Union office to receive his last sick benefit check. Plaintiff testified: “I went in there for my last sick benefit, it was ready for me, a check, and I signed for the check”; that one of the trustees of the Union, in the presence of Robert Fitchie and Mr. Briggs, told him to go up and see “Tad,” the bookkeeper; that he then went to see Tad, who handed him a withdrawal card, dated October 5, 1937, and signed by the president and secretary of the Union; that the card contained, inter alia, the following: “International Brotherhood of Teamsters, Chauffeurs, Stablemen and Helpers Honorable Withdrawal Card 1877 Sec. 86. This is to certify that the bearer hereof, Brother B. H. Fichter whose name appears on the margin of this card in his own handwriting has paid all dues and demands and withdrawn in good standing from membership in Local No. 753. This Card entitles him to readmission to the Local Union from which the card was issued at any time, unless otherwise ordered by the Local Union.” Plaintiff testified that he knew the purpose of a withdrawal card; that “it is to save dues during a time that you are out”; that he took the withdrawal card and walked out, but before he left the Union headquarters he spoke to the president of the Union, who said to him, “Well, Fichter, you can join the CCC now”; that plaintiff answered that the CCC was a “kid organization”; that plaintiff then said goodbye to the president and left; that he “continued to keep the card,” although he did not sign his name on the card.

After a careful consideration of the undisputed evidence that bears upon the instant contention, we are satisfied that plaintiff’s entire conduct after he received notice of the amendments to the by-laws and the payments that he would receive thereunder shows conclusively that he was willing to conform to the benefit provisions of the 1936 by-laws and that he withdrew from the Union after he had received the last payment. To adopt plaintiff’s theory of the evidence would require the assumption that plaintiff in his dealings with the Union after the changes in the by-laws was acting in bad faith with the Union. If he was so acting it would not bind the Union and would avail him nothing. There are circumstances in the case that tend to show that plaintiff at the time was willing to abide by the amendments to the by-laws and to accept payments thereunder. The Union had treated him fairly for many years. It paid him sick benefits from June 22, 1928, to October 5,1937. The payments, prior to the new by-laws, ranged from twenty-two dollars a week to thirty-five dollars a week. All that we can ascertain from the record as to the total amount paid him is that it was somewhere between $10,692 and $17,010. During the great depression the membership in the Union had declined materially, the sick list had greatly increased, and the amount in its treasury had “dwindled away.” Before 1936 the Union was compelled to dispose of some of the securities it held in order to meet the sick benefits. It was “pretty close” to bankruptcy. Plaintiff had been able to do some work in 1936 and 1937. Prior to the time that he joined the Union he was, for years, an accountant, and his testimony shows that he had filled important positions in that class of work. Dr. Summers, one of plaintiff’s witnesses, testified that plaintiff was physically able to work as a bookkeeper. The jury might well have found that plaintiff at the time the amendments took effect felt that the Union had treated him fairly and that it was obliged to change its by-laws as to sick benefits, and that he concluded to abide by the amendments to the by-laws and to accept payments thereunder. Defendants further contend that even if reasonable men could differ in their interpretation of plaintiff’s conduct, the jury’s verdict should settle that phase of the evidence. We hold that the defense interposed by defendants in their instant contention is a meritorious one. If we are right in so holding it follows that the judgment of the trial court must be affirmed.

Defendants raise several other defenses to plaintiff’s claim, but we need not consider them in view of the ruling that we have just made.

The judgment of the Circuit court of Cook county is affirmed.

Judgment affirmed.


source: Caselaw Access Project

author: Mr. Presiding Justice Scanlan

license: Public Domain

text:
    Loretta J. Schneider, Appellee, v. George A. Schneider et al., Appellees. Liggett & Myers Tobacco Company, Appellant. P. Lorillard Company and United States Tobacco Company, Appellees.
    Gen. No. 41,303.

      Heard in the second division of this court for the first district at the June term, 1940.
    Opinion filed November 28, 1941.
    Rehearing denied December 10, 1941.
    Schuyler & Hennessy, of Chicago, for appellant; Daniel M. Schuyler, of Chicago, of counsel.
    Payton J. Tuohy, of Chicago, for appellee; Payton J. Tuohy, of Chicago, of counsel.
   Mr. Presiding Justice Scanlan

delivered the opinion of the court.

An action for separate maintenance and injunction brought by Loretta J. Schneider, plaintiff, against George A. Schneider, defendant. The complaint also made the following corporations defendants: The

Continental Illinois National Bank and Trust Company of Chicago (hereinafter called the “Bank”), Continental Illinois Safe Deposit Company, The Northern Trust Company, American Tobacco Company, American Snuff Company, American Telephone and Telegraph Company (hereinafter called the ‘ ‘ Telephone Company”), George W. Helme Company, Liggett & Myers Tobacco Company (hereinafter called “Liggett & Myers”), P. Lorillard Company (hereinafter called “Lorillard”), and United States Tobacco Company.

At the time the complaint was filed an affidavit of nonresidence was also filed, which alleged that the last known address of George A. Schneider, the principal defendant, a lawyer, who had practiced at the Chicago bar for years, was % American Express Company, Paris, France. Since the commencement' of the proceedings he has remained outside of the jurisdiction of the court. He was served by publication at his last known address, % American Express Company, Paris, France. An attempt was also made to serve him, at the same address, with copies of the summons, complaint and injunction, but these documents were returned to the Clerk of the Superior court marked “Left without address,” “Return to sender.” A witness in behalf of plaintiff testified, before the Special Commissioner, that she later mailed copies of the said documents to Schneider, at the same address, in a plain envelope with the return address of Tuohy & Fortune, and that that letter has never been returned to the return address; that she mailed all notices and copies of orders and petitions to Schneider and that “these have never been returned”; that copies of all subsequent pleadings filed by plaintiff were mailed to Schneider at the same address and were not returned. The evidence clearly shows that Schneider knew of the proceedings. He did not, however, see fit to file an appearance in the cause.

The present appeal is prosecuted by Liggett & Myers from an order entered directing defendants Telephone Company, Lorillard and Liggett & Myers, and each of them, to pay to the Commissioners theretofore appointed all sums of money then held by said defendants and in their possession and control, which were due and owing to the principal defendant, within five days from the date of the order, and that “upon the payment of said sums they accept the receipt of said Commissioners for said sums so paid and that said sums so received by said Commissioners be paid to the plaintiff, Loretta J. Schneider, on account of the indebtedness due her from the defendant, George A. Schneider, and which now amounts to $2,000 and that due credit be given on account of said indebtedness to the defendant George A. Schneider for the sums so paid.” Defendants Lorillard and Telephone Company complied with the order.

The complaint alleged that the principal defendant, Schneider, was the owner of real estate, situated in Cook county, Illinois, that he had money in the Bank, and held stock in the Telephone Company, Lorillard, Liggett & Myers and other corporations; alleged grounds for the issuance of the injunction against Schneider, the Bank, Telephone Company, Lorillard, Liggett & Myers and other corporations; prayed that Schneider’s real estate, money, stocks and bonds be sequestered and that he be enjoined from selling, assigning, hypothecating, transferring, encumbering or otherwise disposing of his stocks and bonds in the Bank, Telephone Company, Lorillard, Liggett & Myers and other corporations, and also any money in the various accounts held in the name of Schneider; prayed that the Bank, Telephone Company, Lorillard, Liggett & Myers and other corporations be enjoined from permitting Schneider to transfer, assign, hypothecate, sell, encumber or otherwise dispose of stocks in the books and records of said corporations. After the injunction issued the Bank, Telephone Company, Lorillard and Liggett & Myers filed general appearances and answers to the complaint.

On June 27, 1939, plaintiff filed a petition alleging that Schneider had not made payments of $500 per month as directed by the court, and requesting the entry of an order allowing her further solicitor’s fees and directing Telephone Company, Lorillard and Liggett & Myers to pay over to the clerk of the court all dividends due or which might thereafter become due to Schneider. Liggett & Myers answered the petition and denied that Schneider receives dividends and other payments in stock or in cash on account of his ownership of the preferred stock of Liggett & Myers, and averred that from and after the entry of the order enjoining Liggett-& Myers from paying dividends on said stock to Schneider, it had complied in every respect with the terms of the injunctional order and withheld payment of dividends on the stock. On November 1, 1939, the Commissioners petitioned for an order directing Telephone Company, Lorillard and Liggett & Myers to pay over to them dividends dne to Schneider in the sums of $107, $200 and $525, respectively. Liggett & Myers answered the petition and alleged, inter alia, that it had in its possession $525 that was then due and payable to Schneider. The answer also alleged that Schneider was not served with a summons in the cause and that to enforce any order directing appellant to pay over any money or property to the Commissioners, or to any other person, except to Schneider, would deprive Schneider of his property without due process of law; that the court was without jurisdiction to order Liggett & Myers to pay any moneys then due to Schneider to the Commissioners until Schneider had been personally served with a summons, or until he had entered his appearance. Liggett & Myers also set up affirmative matters in its answer, alleging the wilful failure of plaintiff to demand a hearing on the merits of her case and the possibility of its being subjected to liability to Schneider in other jurisdictions in the event that the relief prayed for in the petition in question should be granted.

Plaintiff’s theory of the ease is that the proceedings are in rem or quasi in rem; that even though the principal defendant has not been subjected to personal service, the court had power to proceed against the property of the principal defendant located within its jurisdiction and to direct that such property be paid over to plaintiff for her support, maintenance and attorneys’ fees; and that dividends on the stock of Liggett & Myers of which the principal defendant is the holder of record, though declared after the proceedings were commenced, constituted a res within the jurisdiction of the court, since Liggett & Myers, at the time of the commencement of the proceedings, was qualified to do and was doing business in Illinois.

Appellant, Liggett & Myers, contends that the court was without jurisdiction to entertain the petition on which the order appealed from was based, since there has been no personal service on the principal defendant; that a proceeding for separate maintenance is statutory and purely in personam and does not fall within the purview of section 14 of the Civil Practice Act [Jones Ill. Stats. Ann. 104.014], authorizing service by publication in actions “affecting property or status”; that the lower court had no power, statutory or otherwise, to seize personal property of the defendant within its jurisdiction and thus convert a purely personal action into one in rem or quasi in rem.

Appellant argues that the separate maintenance act is in derogation of the common law and must be strictly construed, and that the only power equity has under the act is statutory; “that the Court was without power, statutory or otherwise, to impart to the action the character of one in rem or quasi in rem”; that the maintenance act gives rise to an action in personam, purely, incapable of being maintained in the absence of personal service upon the defendant; that no steps by plaintiff could convert her action into one affecting property, and that, therefore, the trial court was without jurisdiction to enter the order appealed from.

Plaintiff argues that “the proceedings were in rem and the order for alimony could be enforced against the property itself within the jurisdiction of the Court, as the Court had jurisdiction of the subject matter and the res when the order was entered”; that the property sought to be dealt with was brought under the trial court’s control and the court had the power to enter the order appealed from.

A proceeding for separate maintenance is an action in equity, and it would be a serious reflection upon equity if appellant’s contentions are sound. Many years ago our Supreme Court, in Ross v. Ross, 69 Ill. 569, said (pp. 571, 572): “Notwithstanding the common law imposed the duty upon the husband to provide the wife with necessaries suitable to their condition in life, and the obstacles which, from special circumstances, sometimes lay in the way of its enforcement, still, courts of equity, though recognizing the common law duty, almost universally refused to take jurisdiction and enforce specific performance of it, but left the wife to her common law remedy. . . . Now, it was the inadequacy of the common law remedy, and the refusal of courts of equity to take jurisdiction for the enforcement of the husband’s duty to furnish support and maintenance for his wife, that induced the legislature to pass the act of 1867, providing that married women who, without their fault, are living separate and apart from their husbands, may have their remedy in equity, in their own respective names, ag’ainst their respective husbands, for a reasonable support and maintenance, to be allowed with reference to the condition of the parties in life and the circumstances of the respective cases. In construing this act, the court must have, regard to the common law duty or obligation of the husband to support and maintain his wife, the remedy afforded by that law, its defects and inadequacy under many circumstances, and the remedy proposed by the statute, and it is the duty of the court to so construe the act as to suppress thé mischief and advance the remedy. The object of the statute is apparent on its face. It is to confer jurisdiction upon the court of equity to enforce the common law duty of the husband to furnish support and maintenance for the wife suitable to the condition of the parties in life, upon her application, in all cases where she is living separate and apart from him without her fault, or, in other words, under such circumstances as would enable her to avail herself of the common law remedy of obtaining such support upon the credit of her husband.” (Italics ours.)

In Springfield M. & F. Ins. Co. v. Peck, 102 Ill. 265, the complainant brought her bill against her husband for separate maintenance. The decree found (p. 268) that ‘ ‘ defendant had left the State, and that he had on deposit in the defendant bank, at the date of the service of the injunction upon it, the sum of $2500, for which he held certificates of deposit in the usual form, . . . and that the bank should pay to her for the same purpose $1500 of the money her husband had on deposit in the bank at the date of the service of the injunction.” The defendant bank appealed. The court said (p. 269): “It is insisted the injunction was improperly issued in this case, and one reason assigned is, complainant had no specific lien on any property of her husband. A class of cases is cited in support of this proposition, that hold a creditor at large, or before judgment, is not entitled to the interference of a court of equity, by injunction, to prevent the debtor from disposing of his property in fraud of such creditor. Conceding, as may be done, the correctness of the doctrine insisted upon, it is not perceived what application it can have to the case in hand. A principle applicable to a contract creditor can have no appropriate application to a contest between husband and wife, either as to the preservation of the property for alimony, in case of a divorce, or for separate maintenance. The cases have no likeness to each other. Where the wife in her bill for divorce alleges the husband is about to place his property beyond the jurisdiction of the court to control it, a court of equity has always assumed, by temporary injunction, to preserve the property within its control, that it may be charged by a decree for alimony, should a divorce be granted. No reason is perceived why the same thing may not be done where the wife only asks for separate maintenance. Without the restraining order of the court, the final decree, in many cases, would be wholly unavailing to complainant, and the wife, in many instances, would be left without support for herself and children, in case the husband chose to depart from the State and take his property with him, or make other disposition of his property, before final decree could be obtained. Certainly the law will permit no such wrong as that, if the aid of a court of competent jurisdiction is invoked.” (Italics ours.)

Appellant concedes that a court of equity has broad powers in a divorce proceeding and argues that this fact explains the decisions in such cases as Tuttle v. Gunderson, 254 Ill. App. 552; Wilson v. Smart, 324 Ill. 276, and Pennington v. Fourth Nat. Bank, 243 U. S. 269. In the Wilson case our Supreme Court held that although a court is powerless to enter a decree based solely on constructive service of process by publication against a nonresident defendant, yet it has power to deal with his property within the court’s jurisdiction where the object of the action is to reach and dispose of such property or of some interest therein, and the court may enter a decree binding on such property. The Supreme Court in concluding its statement of the law upon the subject uses the following significant language (p. 282): ‘ Constructive service of process upon a non-resident defendant in a proceeding against or concerning specific property of the defendant within the court’s jurisdiction will enable the court to render a decree which is binding upon such property. Decrees for alimony or maintenance in such proceedings, based upon such service, have been sustained. Pennington v. Fourth Nat. Bank, 243 U. S. 269; Forrester v. Forrester, 155 Ga. 722; Shipley v. Shipley, 187 Iowa 1295; Twing v. O’Meara, 59 id. 326; Wesner v. O’Brien, 56 Kan. 724; Blackinton v. Blackinton, 141 Mass. 432; Rhoades v. Rhoades, 78 Neb. 495; Wilder v. Wilder, 93 Vt. 105; Closson v. Closscm, 215 Pac. (Wyo.) 485, 29 A. L. R. 1371, and note 1381.” (Italics ours.) Forrester v. Forrester, Shipley v. Shipley, Blackinton v. Blackinton, Rhoades v. Rhoades and Wilder v. Wilder, cited by the court, involved actions for separate maintenance.

The question now before us has been passed upon by this court in Cox v. Cox, 192 Ill. App. 286, decided in 1915. That was a separate maintenance proceeding where no personal service was had upon the principal defendant. Service was had upon him by publication, but he did not appear. He owned property within the jurisdiction of the court. While we held that no personal decree could be entered against him, we further held (pp. 294, 295): “. . . but in such case, if any property belonging to such defendant is found within the jurisdiction of the court, the court has full power to proceed in rem by requiring such property to bear the obligation of the defendant to provide for the support and maintenance of his wife; and such decree will be as binding upon the defendant and all parties claiming through or under him, so far as his or their right to such property is concerned, as if he had been personally served with process. Therefore, while the Circuit Court had no jurisdiction in this case to enter a personal decree against the defendant, Frederick W. Cox, for the payment of alimony, it had full jurisdiction to enter a proper decree finding the amount that would be a reasonable provision for the support and maintenance of the complainant while living separate and apart from her husband, and to subject the fund in the hands of the insurance company, by a proper order, in case it found such fund to belong to the husband, to the payment of such alimony. The usual decree in a foreclosure suit, finding the amount due and directing that if such amount be not paid within a specified time the property mortgaged shall be sold to satisfy the same, is an illustration of the proper kind of an order to be entered in such case. Such a decree is not a decree in personam, but is a decree in rem. Kirby v. Runals, 140 Ill. 289; Crawford v. Nimons, 180 Ill. 143; Shaffner v. Appleman, 170 Ill. 281.” After giving further consideration to our ruling in the Cox case we are entirely unable to agree with appellant’s argument that the ruling is unsound. The Cox case has been upon the books for many years, and our ruling therein has never been criticized in any case that has been called to our attention. In Cory v. Cory, 249 Ill. App. 293, the Appellate Court of the Fourth District followed the Cox case. In the Cory case the wife sued for separate maintenance, but as the husband was a nonresident, service was had by publication. There was a debt due the husband by a fire insurance company under a policy, and the insurance company was made a party to the proceeding. The decree ordered that the wife have the legal right to the policy of insurance and that the interest of the husband in the same be cancelled. The insurance company appealed from that part of the decree. The Appellate Court, in its opinion, states (pp. 296, 297): “Appellant contends that the court erred in entering any judgment or decree against it without first having obtained jurisdiction over the person of Walter P. Cory; that the situs of the alleged debt due from appellant to the said Walter P. Cory was in the State of Missouri where Cory resided. While a purely personal decree awarding alimony against a nonresident defendant who is notified of the proceeding by publication and who does not appear is not binding upon him, the proceeding will partake of the nature of a proceeding in rem where the complainant describes property of the defendant within the court’s jurisdiction and prays that alimony and solicitor’s fees be made a lien on said property, and the decree may provide that in the event of the defendant’s failure to pay the sum fixed for alimony and solicitor’s fees within a stated time the property shall be sold to satisfy the decree. Wilson v. Smart, 324 Ill. 276. In that case the court was dealing with real estate within the jurisdiction of the court. We see no reason why a court of equity may not reach a debt due a nonresident defendant and subject it to the payment of alimony under a proper bill where the court has jurisdiction over the party who owes the debt. Where a court of law has jurisdiction over a garnishee who is indebted to a nonresident, a judgment may be rendered against the garnishee. The situs of a debt is not material in such cases. Lancashire Ins. v. Corbetts, 165 Ill. 592. We are of the opinion that if there is a debt due from appellant to Walter P. Cory it may be reached under a bill containing proper averments which would give the court jurisdiction. Without stating what those averments should be, we would call attention to the following cases: Cox v. Cox, 192 Ill. App. 286; Forrester v. Forrester, 155 Ga. 722, 20 A. L. R. 1363 and note 1381; Pennington v. Fourth Nat. Bank of Cincinnati, Ohio, 243 U. S. 269, L. R. A. 1917 F 1159.”

In the article on Husband and Wife in 30 C. J., p. 1078, the author states the law that governs separate maintenance proceedings. On page 1081 appears the following: “A personal decree cannot be rendered against defendant in the absence of personal service of process upon, or appearance by him. But where the object of the suit is to compel the support and maintenance of the wife by reaching and appropriating, or fixing a lien upon, property of the husband within the jurisdiction, the suit may proceed to decree as an action in rem without personal service of process upon the husband.” In support of this statement of the law the author cites Cox v. Cox, supra, and other cases.

We do not agree with appellant’s argument that Kelley v. Kelley, 317 Ill. 104, supports its contention. In that case there was no seizure of the husband’s property when the order for temporary alimony was entered. It was strictly an order in personam. If appellant’s position is sound, a husband might depart for Europe leaving behind, in this jurisdiction, a wife dependent upon him for support; there might be within this jurisdiction large property interests of various kinds belonging to the husband and yet the wife would be unable to secure support under the separate maintenance act solely because she could not secure personal service upon her husband. The husband, in the meantime, might be receiving a large income from the properties located in this jurisdiction. Equity would be weak, indeed, if it had not the power to aid the wife under such circumstances. Under the Supreme Court decisions that we have cited there can be no doubt that the trial court had sufficient equitable powers to enforce the object and purpose of the separate maintenance act. We adhere to our ruling in the Cox case and we hold that the contentions raised by appellant are without merit.

Appellant further contends that even if it could be contended that one suing under the separate maintenance act by proceeding properly could bring an action which would affect property within the meaning of section 14 of the Civil Practice Act [Jones Ill. Stats. Ann. 104.014] authorizing service by publication, nevertheless, in the instant suit the property sought to be reached was not brought under the court’s control before the maintenance order was entered, and therefore the plaintiff cannot succeed because the procedure she adopted was improper. On the day plaintiff filed her suit the trial court, upon her motion, entered an . order enjoining the principal defendant from selling any of his stock in the corporations, and also enjoining the defendant corporations, including appellant, from transferring on their books any securities listed in Schneider’s name or from paying out any moneys held by them in his name. The writ of injunction issued and was served on all of the defendant corporations. This injunction was a sufficient seizure of the principal defendant’s properties to give the court jurisdiction to proceed in rem. (See Pennington v. Fourth Nat. Bank, 243 U. S. 269, 272, and the cases cited by Mr. Justice Brandéis in support of the court’s ruling.)

Appellant contends that there is a possibility that it may be subjected to liability to the principal defendant in other jurisdictions and therefore the order appealed from should not have been entered. This fear on the part of appellant is groundless. If it obeys the order of the court it will do so by compulsion of law and will be fully protected against any possible claim of the principal defendant against it. It is significant that Telephone Company and Lorillard, each represented by able attorneys, complied with the order of the court.

The contention of appellant that equity should deny plaintiff the relief she seeks because, as appellant states, she had been dilatory in demanding a hearing and final judgment on the merits of her case? against the principal defendant is without the slightest merit, but it shows the zeal of appellant in protecting the interests of Schneider. The Supreme Court’s criticism of the attitude of the debtor bank in Springfield M. & F. Ins. Co. v. Peck, supra (p. 268), is equally applicable to the appellant.

Plaintiff strenuously contends that a number of the points urged by appellant in this court were not advanced in the trial court and; therefore should not be considered here, but we do not deem it necessary to pass upon this contention.

Plaintiff has filed a motion in this court that the appeal be dismissed for the reason that notice of appeal was not properly served in conformity with the rules of practice. - We reserved ruling upon this motion until the final hearing of the cause. The motion will he denied.

The judgment order of the Superior court of Cook county is affirmed.

Judgment order affirmed.

Sullivan and Friend, JJ., concur.


author: Mr. Justice Friend

text:
    Norvel H. Lilly, Appellee, v. Grand Trunk Western Railroad Company, Appellant.
    Gen. No. 40,882.

      Heard in the second division of this court for the first district at the October term, 1939.
    Opinion filed November 28, 1941.
    Rehearing denied December 10, 1941.
    Winston, Strawn & Shaw, of Chicago, for appellants; Harold A. Smith and Frank B. Gilmer, both of Chicago, of counsel.
    Edward B. Henslee and Samuel Cohen, both of Chicago, for appellee; Paul R, Brown, of Chicago, of counsel.
   Mr. Justice Friend

delivered the opinion of the court.

Norvel H. Lilly, employed as a brakeman by the Grand Trunk Western Railroad Company, fell from the deck of a locomotive tender while engaged in the course of his duties and was severely injured. He brought suit for damages against the company under the Federal Employers’ Liability Act and the Federal Safety Appliance Act. Trial by jury resulted in a general verdict in his favor for $32,500. The court overruled defendant’s motion for a judgment non obstante veredicto and entered judgment on the verdict. Defendant has prosecuted this appeal.

The accident occurred in the railroad yards of the defendant at Ferndale, Michigan, on the morning of February 6, 1937. The crew had performed various switching operations and made up a train which was set out on a lead track, after which the engine was disconnected and moved over to ah adjoining track to take on water. It was part of Lilly’s duty as brakeman to fill the tender with water. The engine having stopped at the water tank, Lilly climbed up the ladder on the rear of the tender, and as he reached the top and stepped around the manhole he found that ice had formed on top of the tender. The operation of taking water required him to pull the waterspout over the manhole of the tender by means of a long pole with a hook attached thereto, which was available for that purpose. According to his testimony he had to kick the hook out of the ice, where it had frozen, and after he had knocked all the ice off the hook he braced himself on the ice where he was standing, with his feet astride, reached for the waterspout and started to pull it into position over the manhole. The hook slipped when the waterspout had come part way round and simultaneously his feet slipped on the ice, causing him to lose his balance and fall over the side of the tender to the ground.

Lilly’s complaint charged that the railroad company and plaintiff were working in interstate commerce, and alleged five separate acts of negligence forming the basis of his suit. Paragraph 4a charges that while plaintiff was on the tender of the locomotive taking-on water, defendant supplied him with a rod and hook for the purpose of pulling the waterspout around over the deck of the tender, which was “dangerous, defective, turned and twisted and covered with ice.” Paragraph 4b charges that the waterspout was defective and dangerous because it was bent out of shape and position. Both of these paragraphs were dismissed on defendant’s motion at the close of plaintiff’s case, and are therefore not the subject of controversy. Paragraph 4c charged in general terms that there was ice on the deck of the tender which the defendant carelessly, negligently, wrongfully and unlawfully permitted to be there. Paragraph 4d charged that there was a violation of the Safety Appliance Act, in that the tender leaked and the top thereof was covered with ice and was slippery. Paragraph 4e, which was added as an amendment to the complaint, charged that the defendant “operated the locomotive and tender ... at the point where the water is supplied to and poured into the locomotive, to be cracked, worn and split, so as to occasion and permit the leaking of water from and through this crack, hole and aperture and to flood, seep and cover the top of the tender” where plaintiff worked. Defendant’s answer-admitted that plaintiff was an employee, but denied that the parties were working in interstate commerce, and also denied the allegations of negligence charged in the complaint.

Under this state pf the pleadings there were only two questions before the jury: (1) the allegation that there was a violation of the Safety Appliance Act, in that the tender leaked and was covered with ice, and slippery; and (2) the general charge of negligence in permitting ice to form and remain on the deck of the tender.

The federal statute upon which plaintiff relied provides that “it shall be unlawful for any carrier to use or permit to be used on its line any locomotive unless said locomotive, its boiler, tender, and all parts and appurtenances thereof are in proper condition and safe to operate in the service to which the same are put, that the same may be employed in the active service of such carrier without unnecessary peril to life or limb . . . .” (45 U. S. C. A. 79, sec. 23.)

In support of this theory of recovery, Lilly testified in his own behalf that he had been on top of this tender the day before taking on water at Pontiac, Michigan; that he had noticed water on the tender that day, “coming from some place on this engine”; and when asked to describe specifically what he saw he testified: “Well, in front of the manhole where the — that is, the hole that the spout is put down into to take the water, right at the seam on top of the tender where the two join together, there was water coming out of there, at the front of this manhole, right at the seam. It was coming out in a stream, not a big stream, just a small stream like spurting out and spreading over the tender. The manhole is about fifteen or eighteen inches wide and about ten to twelve inches high, about three feet long. The stream of water was coming-out from the seam right in front of the manhole, right where the manhole and the top of the tender is riveted together; it was right at the seam, where the two join. It was a very small stream, I will say about like a small nail. ’ ’

To rebut plaintiff’s testimony defendant produced numerous witnesses consisting of the crew and other trainmen who testified that they had inspected the roof of this tender and found no crack or leak in the deck thereof. Among- those who so testified were Francis W. Smith, the foreman who took water on the tender both the day before and later in the day after the accident; Percy A. Findley, a brakeman in the crew prior to the arrival of Lilly; A. E. Granger, the engineer; W. D. Darling, foreman of machinery; P. K. Holton, who filled the tank with water both before and after the accident; Harold Norton and James Russell, inspectors, and several others.

Upon this phase of the case the following interrogatory was submitted to the jury at the request of defendant: “Was there, at the time of the accident in question, a leak in or near the manhole collar on the tender in question?” The jury answered this interrogatory “No,” and thus eliminated from the case the claim of negligence as to the leak or crack in the tender.

Plaintiff’s counsel argue that the examination of the tender by defendant’s witnesses was superficial, and that they could not, by merely visualizing it, accurately determine whether there was a leak in the collar of the manhole where it was riveted to the deck of the tender. It seems to us, however, that this was purely a question of fact which was submitted to the jury, and it answered the special interrogatory adversely to plaintiff’s contention. Moreover, plaintiff had testified that the leak was discernible to the naked eye, and that he could see the water streaming out at a point where the collar of the manhole was riveted to the deck of the tender. Defendant’s witnesses undoubtedly had the same means of determining whether any leak existed there.

It is also urged that the special interrogatory propounded to the jury was not broad enough to cover the allegations of the complaint, since plaintiff had alleged that “the tender leaked there,” and that defendant had operated the locomotive “with the tender . . . at the part where the water is supplied to and poured into the locomotive, cracked, worn and split, so as to occasion and permit the leaking of water from and through this crack, hole and aperture and to flood, seep and cover the top of the tender.” While it is true that these allegations are somewhat broader than the language of the special interrogatory, there is no evidence whatsoever to support them other than the testimony of Lilly which has heretofore been set forth in full, and which is confined exclusively to a ‘ ‘ stream of water . . . coming out from the seam right in front of the manhole, right where the manhole and the top of the tender is riveted together . . . where the two join ... a very small stream . . . about like a small nail.” This evidence justified the court in propounding the interrogatory of which plaintiff’s counsel complain, fixing the leak “in or near the manhole collar on the tender in question. ’ ’ Any broader interrogatory would not have been justified by plaintiff’s own testimony.

Plaintiff’s counsel evidently appreciated the import of the special interrogatory, because in his closing-argument to the jury he made the following- observation, “So, as I say, gentlemen, do not find that there was no leak, or you put him out of court.” Notwithstanding- this argument, the jury, upon' the evidence adduced, found that there was no leak, and consequently that there was no violation of the Safety Appliance Act.

By ruling- out any leak “in or near the manhole collar on the tender,” there remains only one ground in the complaint upon which the jury could have based its verdict of liability against defendant. That was paragraph 4c, which charged that there was ice on the deck of the tender which defendant “carelessly, negligently, wrongfully and unlawfully” permitted to be there. It is conceded that it had not rained or snowed that day nor the day before. The weather was clear and freezing- and from these circumstances plaintiff’s counsel now argue that the ice on the tender must have formed through the carelessness of another employee in allowing- water to spatter on the deck while filling the tank of the engine before it left Detroit that morning, which froze and formed ice on the way to Ferndale. Plaintiff’s counsel are driven to this argument by reason of the special verdict rendered adversely to plaintiff’s testimony that the water on the deck of the tender accumulated there through leakage of the manhole. Although it is conceivable that another employee may have negligently and in violation of the company’s rule and usage permitted water to overflow or spatter on the deck of the tender there is no evidence whatsoever to support the argument; it is at best an inference drawn from the fact that it had not rained or snowed that day and therefore the presence of water on the deck, which later formed into ice, could not have gathered there in any other way.

To support a verdict predicated on general negligence in cases of this kind it is always incumbent on the injured party to prove defendant actually had knowledge of the dangerous condition or that it had existed for a sufficient length of time so as to charge defendant with notice. (Hatton v. New York, N. H. & H. R. Co., 261 Fed. 667, 669.) In this proceeding there is no evidence to indicate that defendant or any of its agents or employees knew of the ice or that it had been there long enough to charge them with notice. On the other hand, it is clear that plaintiff knew of the water on the tender because he testified on cross-examination that on February 5, the day preceding the accident, he had observed the leakage of water through the collar of the manhole where it is riveted to the deck and that water had accumulated there. Notwithstanding the rule of the company that the discovery of defects must be reported by employees to their superiors, plaintiff said nothing of the leakage which he says he had' discovered. The fact remains, however, that he knew of the water on the deck of the tender, and it is equally clear that neither defendant nor any of its agents or servants had knowledge of this fact.

Defendant’s counsel, while stressing these circumstances, take the position that “whether the ice was there through negligunce or whether it was there unavoidably,” plaintiff cannot recover, because he assumed the risk. Both parties cite numerous decisions in State and Federal courts dealing with the doctrine of assumed risk. The law is clear that a suit predicated upon the Employers’ Liability Act or the Safety Appliance Act is governed by the rules laid down in Federal cases. From the discussion by counsel of the doctrine of assumed risk, and an examination of the leading authorities, it is evident that although the defense of assumption of risk is not a favored doctrine, and should not be extended beyond its reasonable limits, it was an established part of the law when this suit was instituted and must be applied in cases fairly within the rule. (39 Corpus Juris, sec. 891, p. 689.) And where a servant’s assumption of risk is conclusively established it becomes a question of law so as to preclude recovery. From the numerous decisions cited we gather two fundamental requirements necessary to the application of the doctrine: (1) that the injured party must have had knowledge of the defective conditions; and (2) he must have appreciated the danger which caused his injury. (Hatton v. New York, N. H. & H. R. Co., 261 Fed. 667, 669; Seaboard Air Line Ry. v. Horton, 233 U. S. 492, 504; Jacobs v. Southern Ry. Co., 241 U. S. 229; Boldt v. Pennsylvania R. R. Co., 245 U. S. 441, 445.)

As applicable to these decisions there can be no doubt that the plaintiff knew of the icy condition of the tender. He so testified, unequivocally. Moreover, he must have appreciated the danger because he also said that “I braced myself good, putting my one leg forward and one leg kind of behind me to brace myself good.” The danger of attempting to stand on the icy surface of the tender and pull a heavy implement from one position to another must have been apparent to plaintiff; otherwise, he would not have had to brace himself, as he testified, to avert slipping. Plaintiff’s counsel propounded the inquiry as to what the law required him to do when he discovered the slippery condition of the tender, by asking, “How must he extricate himself if he appreciates a danger he cannot evade? Is he required to walk off immediately?” This is not the kind of danger employees frequently encounter when a train is in motion and which requires immediate action, nor was it a situation where an unforeseen risk arose. It is not disputed that all railroad crews carry sand or ashes on the engines, and there is nothing to indicate that plaintiff could not have made the surface of the tender safe before taking-water. Under the circumstances we are impelled to hold that plaintiff assumed the risk and that the court should have entered judgment notwithstanding the verdict as a matter of law.

This action occurred February 6, 1937. After suit was filed, issues formed, the trial concluded with judgment on the verdict and the appeal perfected in this court, an amendment to the Federal Employers’ Liability Act became effective by congressional action and the signature of the president, on August 11,1939, which by concession removes the defense of assumption of risk in every accident occurring* after the amendment to the federal statute was passed, and plaintiff’s counsel now urge that this amendment affects and applies retroactively to cases pending on appeal which are not yet finally decided. A considerable portion of the briefs is devoted to a discussion of this question. We find among the decisions some cases where courts have held that if a statute is of a type that can be applied retrospectively the fact that a case is pending on appeal will not affect retrospective application of the new law, but an examination of the decisions convinces us that such statutes deal only with remedies, and not with vested rights. The Supreme Court of the United States has consistently held, as a fundamental rule of statutory construction, that a statute is not to he given a retroactive effect unless by plain and definite words of the statute such a construction is unavoidable. In the early case of United States v. Heth, 3 Cranch (7 U. S.) 399, the collector of customs prior to the enactment of the statute in June 1800, had received certain sums of money for which he was to be compensated on a percentage basis. By the act of that year his compensation was restricted to a commission of 2% per cent on the amounts collected. Holding that the statute did not affect the prior transactions, the court said (p. 413): “Words in a statute ought not to have a retroactive operation, unless they are so clear, strong and imperative, that no other meaning can be annexed to them, or unless the intention of the legislature cannot be otherwise satisfied. ’ ’ Later, in Murray v. Gibson, 15 How. (56 U. S.) 421, the court had to pass on a statute of Mississippi, enacted in 1846, which declared that no record of any judgment recovered in a foreign court against a citizen of Mississippi should be received as evidence after the expiration of three years from the time of rendition of the judgment. The Supreme Court held that the statute had no application to a judgment rendered before its passage, and again said (p. 423): “As a general rule for the interpretation of statutes, it may be laid down, that they never should be allowed a retroactive operation where this is not required by express command or by necessary and unavoidable implication. Without such command or implication they speak and operate upon the future only.” The same conclusions were reached in McEwen v. Den, 24 How. (65 U. S.) 242; Sohn v. Waterson, 84 U. S. 596; United States v. St. Louis, S. F. & T. Ry. Co., 270 U. S. 1, 3.

It seems clear to us that the existence of assumed risk as a defense to a suit at law is a vested right and not a remedy because it affects the liability of a railroad to an action upon which a money judgment may be predicated. The cases relied upon by plaintiff’s counsel, as well as quotations from textbook writers, deal almost exclusively with remedies and not with vested rights. The right to a particular remedy may be taken away from litigants by the legislature through amendments which are retrospective, but the cases are uniformly to the effect that the legislature may not destroy a vested right by enactment of a law which operates retroactively. There is nothing in the amendment to the Federal Employers’ Liability Act which would justify the assumption that congress intended to make it operative prior to August 11,1939, the day on which it became effective.

Lastly, it is urged by defendant that at the time of the accident the way freight did not contain interstate cars, and therefore the parties were not engaged in interstate commerce. We have examined the record on this phase of the case and are satisfied that the contention is not well taken. In view of our conclusion on the other points we deem it unnecessary to discuss the point in detail.

In view of the conclusions herein set forth, we are of the opinion that judgment should have been entered on defendant’s motion for judgment non obstante veredicto, and therefore judgment of the superior court is reversed and the cause is remanded with directions to enter judgment in favor of defendant notwithstanding the verdict of the jury.

Judgment reversed and cause remanded with directions to enter judgment in favor of defendant non obstante veredicto.

Scanlan, P. J., and Sullivan, J., concur.


text:
    Wolf Siegel, Appellant, v. Western Union Telegraph Company, Appellee.
    Gen. No. 41,139.

      Heard in the second division of this court for the first district at the February term, 1940.
    Opinion filed November 28, 1941.
    Rehearing denied December 10, 1941.
    Harry A. Silverstein, of Chicago, for appellant; Ben Copple and Meyer Silverstein, both of Chicago, of counsel.
    West & Eckhart, of Chicago, and Francis E. Stark, General Solicitor, for appellee; Owen A. West and Paul Hassell, both of Chicago, of counsel.
   Mr. Justice Friend

delivered the opinion of the court.

Plaintiff brought suit against the Western Union . Telegraph Company for damages resulting from its failure to transmit promptly a telegraphic money order. The court limited his damages to the charge made for transmitting the money order and entered judgment accordingly for $1.92. Upon the theory that he had established damages in excess of $500, the maximum sum provided in the tariff regulation then on file with the Federal Communications Commission, plaintiff seeks reversal of the judgment and the entry of judgment here in the sum of $500 and costs.

The cause was submitted and tried by the court upon stipulated facts. It appears that on November 23, 1938, plaintiff delivered to the Western Union Telegraph Company $200 with instructions to transmit this sum to P. W. Gunkel, a friend of plaintiff residing at Rogers Smith Hotel in Washington, D. C. The money was to be wagered on a horse named Mintson, to win, at the pari mutuel machines at Bowie Race Track in Maryland, where pari mutuel wagering is legalized under the laws of that State. The money order was negligently misdirected to New York City and was ultimately delivered to Gunkel several hours after the race had been run November 24, 1938. Mintson won and the pari mutuel machines paid $18.50 for each $2 wagered. Had plaintiff’s $200 been placed the odds would have been reduced to $16.50. Deducting the principal of the money order which was returned to plaintiff he claims to have sustained damages to the extent of $1,450 through defendant’s negligence.

The suit is predicated on a tariff regulation then in effect and on file with the Federal Communications Commission, which also appears as one of the conditions set forth on the back of the money order application, providing: ‘.‘In any event, the Company shall not be liable for damages for delay, nonpayment or underpayment of this money order, whether by reason of negligence on the part of its agents or servants or otherwise, beyond the sum of $500, at which amount the right to have this money order promptly and correctly transmitted and promptly and fully paid is' hereby valued, unless a greater value is stated in writing on the face of this application and an additional sum paid or agreed to be paid based on such value equal to one-tenth of one per cent thereof.”

Prior to 1910 telegraph companies had a common-law liability from which they might or might not extricate themselves according to views of policy prevailing in the several States. (Western Union Telegraph Co. v. Esteve Bros. & Co., 256 U. S. 566 (1921).) In-June of that year Congress broadened the scope of the act to regulate commerce so as to include telegraph, telephone and cable companies engaged in sending messages interstate and to any foreign country. (Chapter 309, sec. 7, 36 Stat. at L. 539.) This act “introduced a new principle into the legal relations of the telegraph companies with their patrons which dominated and modified the principles previously governing them. . . . Thereafter, for all messages sent in interstate or foreign commerce, the outstanding consideration became that of uniformity and equality of rates. Uniformity demanded that the rate represent the whole duty and the whole liability of the company. It could not be varied by agreement; still less could it be varied by lack of agreement. The rate became, not as before a matter of contract by which a legal liability could be modified, but a matter of law by which a uniform liability was imposed.” (Western Union Telegraph Co. v. Esteve Bros. & Co., 256 U. S. 566.)

Pursuant to this enactment the interstate commerce commission decided upon investigation that the existing rules and rates of the telegraph companies limiting their liability for negligence were unreasonable and prescribed rules and rates therefor which fixed the maximum liability in case of unrepeated messages at not less than $500. (Cultra v. Western Union Telegraph Co., 61 I. C. C. 541 (1921).) In accordance with the order entered in the Cultra case the Western Union Telegraph Company prepared its new rules and tariffs relating to messages and subsequently extended them to money orders by including the provision in question.

Wernick v. Western Union Telegraph Company, 290 Ill. App. 569 (1937), was one of the earliest cases requiring the construction of the tariff regulation in question. We were there called upon to decide whether the amount of $500 as stipulated therein constituted liquidated damages for nonpayment or underpayment of a money order transmitted through the Western Union Telegraph Company or whether it was merely a limitation on the liability of the company to the extent of actual damages sustained. We construed the regulation as a limitation upon the liability of the company for rate-making purposes and held that plaintiff could recover for actual damages shown, but not to exceed the sum of $500. This conclusion was predicated upon the historical origin and effect given to similar tariff regulations governing public carriers in Western Union Telegraph Co. v. Esteve Bros. & Co., 256 U. S. 566, and Western Union Telegraph Co. v. Priester, 276 U. S. 252.

Plaintiff relies on Western Union Telegraph Co. v. Nester, 106 P. (2d) 587 (1939), wherein the circuit court of appeals (ninth district), with one of the justices dissenting, construed this precise regulation as an agreement for liquidated damages, despite the sender’s failure to prove actual damages. The Supreme Court of the United States granted certiorari, and, since briefs were filed in this cause, has reversed the decision of the circuit court of appeals, quoting with approval the construction we placed upon the tariff regulation in the Wernick case. The precise question was also considered in Miazza v. Western Union Telegraph Co., 50 Ga. App. 521, 178 S. E. 764 (1935), with the same result. All these decisions discuss the origin and effect of the stipulated value of the regulation and leave no doubt that the amount of $500 stated in the contract is for the purpose of limiting, but not of fixing, the damages. Under these decisions plaintiff is required to prove actual damages, and recovery is limited in any event to the stipulated amount of $500. The cogent reasons for this limitation are twofold: telegraph rates imposed by the Federal government are framed on the basis of determining the cost of rendering the service of rapid transmission to the public at reasonable rates and with a.fair margin of profit to the carrier, and if liability were to be unlimited, the company’s ability to continue business might be seriously endangered; certainly it could not continue in business operating under the present rate structure. On the other hand, if the rates should be increased sufficiently to offset the higher expense resulting from unlimited liability, the carrier’s volume of business would materially decrease and its services would not be available at prices within reach of the general public. (Cultra v. Western Union Telegraph Co., 61 I. C. C. 541.)

The case at bar involved an interstate transaction. Under the stipulated facts plaintiff was deprived of winning $1,450 on Mints on through misdirection of the money order. The company’s negligence is conceded. The. question therefore presented is whether plaintiff should have been awarded as special damages the maximum amount of $500 stipulated in the contract.

Under the rule generally applied to the nonpayment or underpayment of money orders transmitted through telegraph companies, the measure of damages is the interest on the money from the time it should have been delivered to the time it was actually delivered, together with the cost of the message. This rule was followed in Lust v. Western Union Telegraph Co., 243 Ill. App. 624 (Abst.) (1926), not reported, general number 31035, wherein the court held that any other loss would be too remote and said that ‘ ‘ ordinarily, the measure of damages for the nonpayment of money when due is interest from the time of the default to the time the money is paid; and this rule applies to the failure on the part of a telegraph company to perform its agreement to transmit money to a person at a distant point.” (Citing Jones on Telegraph & Telephone Companies, sec. 567; 37 Cyc. 1775; and Smith v. Western Union Telegraph Co., 150 Pa. St. 561.) In an earlier case, Churches v. Western Union Telegraph Co., 108 Kas. 431 (1921), a farmer purchased two teams of horses at Kansas City, Missouri, and telegraphed his bank at Lawrence, Nebraska, to forward him $600 to pay for them. Defendant failed to transmit the money and plaintiff sued the telegraph company for board for himself and his teams and other damages, including his traveling expenses and the cost of the message. The court stated the rule as follows: “The defendant contends that the measure of damages is the cost of transmitting the telegram and interest on the $600 for the time it was held by the telegraph company, about ten days. The authorities support this contention.” The same rule was applied under similar circumstances in 24 Ky. Law Reports 452; Loudon v. Taxing Dist. of Shelby County, 104 U. S. 771 (1881); and Green Briar Drainage Dist. of Crawford and Jasper Counties v. Clark, 292 Fed. 828.

However, the authorities recognize an exception to this rule in cases where the telegraph company has notice, at the time of making the contract, of such special facts or circumstances as to justify the conclusion that special or unusual damages are within the contemplation of the parties. Lust v. Western Union Telegraph Co., 243 Ill. App. 624 (Abst.); 37 Cyc. 1775. The exception dates back to the early case of Hadley v. Baxendale, 9 Exchequer 341 (1854), and it has since been generally held that whether or not a telegraph company incurs any special liability, for its default in transmitting money, depends on whether it has been put on notice of circumstances such as would reasonably have led an ordinarily prudent person to anticipate consequential losses or injuries from a failure to deliver the message. 80 A. L. R. 301 (citing cases); Western Union Telegraph Co. v. Hall, 287 Fed. 297. It was stipulated in the case at bar that defendant had no notice or knowledge of the purpose for which the money was being transmitted.

Plaintiff’s counsel evidently recognize the foregoing rule and exception, for they say in their brief: “The measure of damages imposed by common law upon telegraph companies for negligence as established by decisions of this state and other states, was the application of the rule that the person breaching a contract could only be liable for damages which fairly and reasonably should be considered as flowing from the breach of contract, or such as may reasonably be supposed to have been in the contemplation of the parties at the time they made the contract as the probable result of the breach of it. Thus, in order to collect damages against a telegraph company for negligence at common law, it was necessary to prove not only that damages were sustained but also that the defendant had or should have had knowledge from the contents of the telegram that said damage might result from a breach of contract resulting through negligence. So in the case of a money order, the same rule applied and recovery to the fullest extent was therefore limited to those cases where the defendant was put on notice of the purpose for which the money was transmitted.” It is urged, however, “that the common law liability of the defendant no longer exists and the liability . . . must be' determined by the construction of the tariff regulation in question.” This argument made by plaintiff before the Supreme Court had filed its opinion in Western Union Telegraph Co. v. Nester, 309 U. S. 582, is predicated largely upon the contention that the amount of $500 stipulated in the tariff regulation constituted liquidated damages ; but since the court, by construing the regulation as a limitation upon the liability of the company and not as liquidated damages, has finally resolved the question adversely to plaintiff, the argument loses its principal support. Plaintiff relies upon language employed in Western Union Telegraph Co. v. Esteve Bros. (& Co., 256 U. S. 566, and Western Union Telegraph Co. v. Priester, 276 U. S. 252, from which he seeks to derive additional support of his position. In the Esteve case a company engaged in transmitting telegraphic messages in the United States and by cable between here and France established a tariff offering a lower rate for unrepeated and a higher rate for repeated messages and limiting its liability for mistakes in transmitting unrepeated messages to the tolls accruing to it therefrom, and filed the tariff with the interstate commerce commission under the Interstate Commerce Act, as amended June 18, 1910. (Chapter 309, sec. 7, 36 Stat. at L. 539.) An unrepeated message sent by plaintiffs from Spain passed over other lines to Havre where it was received by the company and sent to New Orleans, an error being introduced on the land lines in this country which caused the plaintiffs a loss of some $31,000. The provision limiting liability was not expressed on the blank used in sending nor did the senders know of its adoption and filing. The court held that whatever the legal incidents of the transmission over the foreign lines, the company in carrying the message over its own lines from Havre was governed by the Interstate Commerce Act, as amended; that the senders of the message were bound as a matter of law by the provision limiting liability, without regard to their knowledge or assent, because it was a part of a lawfully established rate which could not be departed from without creating an undue preference or advantage in violation of section 3 of the statute; and that where a cable company offered a lower rate, with limited liability, for unrepeated messages, and a higher rate for repeated messages, with a higher but still limited liability, the senders of an unrepeated message who paid the lower rate could not escape its attendant limitation upon the ground that liability under the higher rate was also limited, since the latter limitation, if invalid, would not bind those who used the higher rate, and the question of its validity was not material in the case. The Priester case involved a provision in the tariff filed by the Telegraph Company pursuant to the Interstate Commerce Act, as amended, fixing a lower rate for an unrepeated message and limiting the liability of the company for mistake in its transmission to the amount received for sending it. It was there held that the tariff regulation represents the entire liability of the company for a mistake of that kind; and being statutory, cannot be enlarged by the courts upon the ground that the mistake was due to “gross” negligence.

Neither of these cases supports the contention that the common-law rule for ascertaining damages has been superseded by the tariff regulations. Under the established rule for construing the regulation in question, the extent of the common-law liability of telegraph companies for negligence has been limited by their tariff provisions, unless the sender places a greater value than $500 on his money order and pays or agrees to pay therefor. Plaintiff must in each instance prove actual damages and the company is liable under the common law, to the extent for which it is liable under its tariff. We conceive no reason for holding that the control of interstate business of telegraph companies by the Federal government, through published rules, regulations and tariffs, was intended to change or affect the long established rule that recovery for special damages can only be had in cases where the special damage was within the contemplation of the parties, and we find no authority so holding.

Judgment of the municipal court is affirmed.

Judgment affirmed.

Scanlan, P. J., and Sullivan, J., concur.