Opinion
(Filed 14 April, 1915.)
1. Water Companies — Contracts with City — Rights of Citizens — Fire Damage.
A citizen whose property has been destroyed by fire may recover damages of a water corporation for a breach of its contract with the city "to afford a supply of water for the use of the citizens — and protection from fire," when the damages were proximately caused thereby. Gorrell v. Water Supply Co., 124 N.C. 328, cited and sustained.
2. Same — Decisions — Corporation Charter — Implied Provisions.
The right of a citizen and taxpayer to recover for the loss of his property by fire caused by the failure of a water corporation to perform its contract with the city to furnish a supply of water for fire protection, impliedly incorporates within the provisions of its charter the law then existing; and in this action for damages for destruction by fire, it appearing that Gorrell v. Water Supply Co., 124 N.C. 328, had been decided some two years before the defendant had acquired its charter, it acquired its charter rights subject to the doctrine therein announced by the Supreme Court.
3. Pleadings — Amendments — Court's Discretion — Appeal and Error.
An exception to an amendment allowed in the discretion of the trial judge, which does not change the issues raised by the pleadings, will not be considered on appeal unless this discretionary power has been abused; and the same rule applies when the issues are changed, unless it appears that the appellant has been prejudiced in not being able to secure and introduce his evidence.
4. Water Companies — Contract with City — Breach — Damage by Fire — Other Fires.
Where a citizen sues a water company for damages from fire alleged to have been caused by the failure of the defendant to supply the agreed quantity of water for fire protection under a contract with the city, and the evidence thereon is conflicting, it is competent for the plaintiff to show that the defendant had failed to thus supply water at other fires which had occurred under ordinary and usual conditions.
5. Appeal and Error — Unanswered Questions.
An exception to the exclusion of an answer to a question asked a witness will not be considered on appeal unless it is made to appear that its exclusion was prejudicial to the appellant.
6. Corporations — Officers — Subsequent Declarations — Principal and Agent — Evidence.
After the president and superintendent of a water corporation have been permitted to testify in its behalf as to the condition of the plant, in an action by a citizen to recover damages for a fire loss, it is competent for the plaintiffs to show on their cross-examination, and by other witnesses, declarations, made by them after the fire, to contradict their testimony; for declarations of this character do not fall within the prohibition as to declarations of ordinary agents made after the act complained of.
7. Pleadings — Tax Lists — Impeaching Evidence.
Where the complaint in an action to recover damages for property destroyed alleges that its valuation for taxation is the true one, the tax list thereof is competent to contradict the plaintiffs' testimony at the trial, and the ordinary rule does not apply.
APPEAL by defendant from Bragaw, J., at December Term, (583) 1913, of BEAUFORT.
Daniel Warren and A. D. McLean for plaintiffs.
Rodman Bonner, W. B. Rodman, Jr., W. A. Wilcox, and W. J. Wilcox for defendant.
BROWN, J., concurring in result.
WALKER, J., dissenting; HOKE, J., concurs in dissenting opinion.
This action is a consolidation of two actions originally brought and entitled "Charles L. Morton v. Washington Light and Water Company" and "W. B. Morton, trading as W. B. Morton Co., v. Washington Light and Water Company." The alleged damage in each instance was based upon the same alleged negligence, and at the trial of the action the two causes were consolidated, by consent.
The plaintiff Charles L. Morton was originally suing for the destruction of a store building owned by him, by a fire which occurred on the night of 27 July, 1911, and the plaintiff W. B. Morton was suing for the destruction or loss of a stock of goods contained in the store at that time and owned by the said W. B. Morton.
Both plaintiffs, in their complaint, alleged that the defendant entered into a contract with the town of Washington in 1901 to build and maintain a waterworks system and to furnish a certain pressure with which to fight fires; that on the night of 27 July, 1911, a fire originated in a building adjoining the building of the plaintiff Charles L. Morton, and that by reason of the negligent failure of the defendant company to furnish the pressure which it contracted to furnish, the fire, originating in the George Morton building (that is, the building adjoining the Charles L. Morton building), spread to and destroyed or burned the building of the plaintiff Charles L. Morton, and the stock of goods therein, owned by the plaintiff W. B. Morton.
The contract stipulated that it was "to afford a supply of water for the use of the citizens of the town of Washington, and in order to furnish protection from fire to the property of said citizens."
The buildings were separated by a wooden partition.
The building owned by Charles L. Morton was insured for the sum of $4,000, which insurance he collected. The stock of goods owned by W. B. Morton was insured for $1,000, which insurance he collected.
The plaintiff Charles L. Morton, in his original complaint, sued for $2,000 for damage to the building and the plaintiff W. B. Morton sued for $1,500 for loss of personal property.
At the time and upon the day the cause was set for trial the plaintiff Charles L. Morton, for the first time, asked leave of the court to amend his complaint. The court, in its discretion, over the objection (584) of the defendant, permitted the amendment. The defendant thereupon moved the court for a continuance of the cause until the next succeeding term. This motion the court refused, but continued the cause until the next succeeding day, or for a period of about twenty-four hours.
The following verdict was rendered by the jury:
1. At the time of the injury to and destruction of the property of plaintiffs by fire, had the defendant water company undertaken to furnish the city of Washington a supply of water according to the plans and specifications contained in the agreement and contract of 11 December, 1901, as set out in the complaint, in the quantity, under the pressure, and for the purposes therein recited? Answer: "Yes."
2. At such time was said defendant company engaged in supplying water to said city of Washington under and pursuant to said agreement and contract, and in the exercise and enjoyment of the privileges of the same, and demanding and collecting from the said city the price stipulated in the said agreement for furnishing water, at its customary times for making such collections, during the year and period in which plaintiffs' loss accrued? Answer: "Yes."
3. At the time of the injury to and destruction of the property of the plaintiffs by fire, did the defendant water company fail and neglect to furnish the quantity and pressure of water it had agreed to furnish on occasion of fire in its said contract with the city of Washington? Answer: "Yes."
4. If so, was the property of the plaintiffs injured and destroyed by the negligence of defendant, as alleged in the complaint? Answer: "Yes."
5. If so, what damages, if any, is the plaintiff Charles L. Morton entitled to recover of the defendant? Answer: "$2,500, with interest."
6. If so, what damages, if any, is the plaintiff W. B. Morton entitled to recover of the defendant? Answer: "$1,000, with interest."
The defendant raised the question as to its liability to the plaintiff by exception to the judgment, prayers for instruction, and by motion for judgment of nonsuit.
There are other exceptions relied on which will appear in the opinion of the Court.
There was judgment for the plaintiffs, and the defendant appealed.
The principles announced in Gorrell v. Water Supply Co., 124 N.C. 328, establish the liability of the defendant to the (585) plaintiffs upon the facts found by the jury and those admitted in the pleadings, and the defendant, realizing this, asks us to overrule that case. We have therefore reexamined the decisions in this and other jurisdictions, and the arguments and reasoning upon which they rest, and after full consideration have determined to adhere to the former ruling of this Court.
It may be conceded, as contended by the defendant, that the weight of authority, measured by number, is against the decision in the Gorrell case, supra, but this was known and considered at the time of its rendition, and since then, instead of receding from the position then taken, the doctrine has been affirmed in Fisher v. Water Co., 128 N.C. 375; Lacy v. Webb, 130 N.C. 546; Gastonia v. Engineering Co., 131 N.C. 368; Wadsworth v. Concord, 133 N.C. 587; Voorhees v. Porter, 134 N.C. 591; Kernodle v. Tel. Co., 141 N.C. 426; Helms v. Tel. Co., 143 N.C. 386; Wood v. Kincaid, 144 N.C. 393; Clark v. Bonsal, 157 N.C. 270; Brady v. Randleman, 159 N.C. 434, and in Jones v. Water Co., 135 N.C. 553.
In the last case the contract was similar to the one now before us, and the Court said, upon the right to sue: "There can be no real contention that the plaintiff, a citizen and taxpayer, and one of the beneficiaries in the purview of this contract, cannot prosecute this action. He is the real party in interest. He is taxed with payment of his pro rata of the annual rental. The town cannot maintain this action for the loss sustained by him by reason of the defendant's failure to perform the provisions of the contract above recited. For this injury the plaintiff alone can sue. This point was discussed and settled in Gorrell v. Water Supply Co., 124 N.C. 328 (70 Am. St. Rep., 598; 46 L.R.A., 513), which has been followed in Fisher v. Water Co., 128 N.C. 375, and cited and approved in Lacy v. Webb, 130 N.C. 546, and Gastonia v. Engineering Co., 131 N.C. 368, in which last the doctrine is elaborated. The same principle had been often affirmed prior to Gorrell's case, supra, to wit, that "the beneficiary of a contract, though not a party to it nor expressly named therein, can maintain an action for a breach of such contract causing injury to him, if the contract was made for his benefit."
It also appears that the case has been followed in Mugge v. Tampa Waterworks, 52 Fla. 371, and Springfield Ins. Co. v. Graves County Water Co., 120 Ky. 40; and in Guardian Trust Co. v. Fisher, 200 U.S. 57, the Court, affirming the principle, says: "It is true that a company contracting with a city to construct water works and supply water may fail to commence performance. Its contractual obligations are then with the city only, which may recover damages, but merely for breach of contract. There would be no tort, no negligence, in the total failure on the part of the company. It may also be true that no citizen is a party to such a contract, and has no contractual or other right to recover for the failure of the company to act; but if the company (586) proceeds under its contract, and operates its plant, it enters upon a public calling. It occupies the streets of the city, acquires rights and privileges peculiar to itself. It invites the citizens, and if they avail themselves of its conveniences and omit making other and personal arrangements for a supply of water, then the company owes a duty to them in the discharge of its public calling, and a neglect by it in the discharge of the obligations imposed by its charter, or by contract with the city, may be regarded as a breach of absolute duty, and recovery may be had for such neglect. The action, however, is not one for breach of contract, but for negligence in the discharge of such duty to the public, and is an action for a tort."
Another reason for refusing to sustain the position of the defendant is that it entered into the contract with the city of Washington in 1901, two years after the Gorrell case, supra, was decided, and as all laws relating to the subject matter of a contract enter into and form a part of it as if expressly referred to or incorporated in its terms (Lehigh Water Co. v. Easton, 121 U.S. 391; Wooten v. Hill, 98 N.C. 48), it was within the contemplation of the parties at the time the contract was made that the defendant would be liable to the citizen for loss by fire caused by its negligent failure to perform the terms of the contract, as held in the Gorrell case, supra, and to hold otherwise now would relieve the defendant of a responsibility which it knowingly assumed.
The other exceptions relied on by the defendant will be considered in the order in which they are discussed in the briefs.
(1) The amendment to the complaint, which was filed by permission of the court on the day before the trial, only added an additional item of damage, and did not change the issues raised by the pleadings, and it does not appear in the record that the time allowed the defendant to prepare its evidence was not ample.
The rule as to a continuance when new parties are made or amendments allowed is correctly stated in Watson v. R. R., 164 N.C. 176, where the Court says: "If new parties are made or amendments allowed, which change the issues, and a party is not prepared with his evidence to meet the changed conditions, he is entitled to a continuance as a matter of right (Dobson v. R. R., 129 N.C. 289); but ordinarily the ruling of the judge upon a motion for continuance is a matter of discretion, and not reviewable, and in this case it appears that there was no change in the pleadings or issues, and no suggestion that it would be more prejudicial to the defendant to try at that time than at any other."
It does not appear that the defendant has been prejudiced, or that the discretion vested in the trial judge has been abused, and the exception to the refusal to continue must therefore be overruled.
(2) The plaintiffs introduced evidence tending to prove that (587) the capacity of the defendant's plant had decreased since its installation, and the defendant's evidence was that it had all times complied with its contract.
The plaintiffs further introduced evidence, the defendant objecting thereto, that the defendant had failed to supply water according to its contract at other fires before the fire which destroyed the property of the plaintiffs.
This evidence does not fall under the condemnation of the rule which forbids the proof of other negligent acts as evidence of the negligence complained of, and was competent upon the question as to the condition and capacity of the plant at the time of the fire.
There were no exceptional circumstances connected with the other fires, and, so far as the evidence disclosed, the plant was in its usual condition.
If so, and the capacity had decreased, as the plaintiffs contend, the fact that it did not furnish water according to the contract at other fires would be some proof that it could not do so at the time of the fire complained of. The evidence comes within the principle of the case of Blevins v. Cotton Mills, 150 N.C. 493.
(3) A witness for the plaintiffs was asked a question by the defendant on cross-examination, which the court refused to permit the witness to answer, but as there is nothing to indicate what the answer of the witness would have been, the exception to the action of the court cannot be considered. Wallace v. Barlow, 165 N.C. 676.
(4) The defendant introduced its president and superintendent, each of whom testified substantially that the plant of the defendant was at all times properly equipped and maintained, and the plaintiffs were permitted to prove upon cross-examination, and by other witnesses, declarations of the president and superintendent, made after the fire, tending to contradict their testimony.
This does not come within the principle excluding the declarations of an agent as to a past occurrence, and the evidence was properly admitted. The rule and the exception are applied in Pate v. Steamboat Co., 148 N.C. 511, as follows: "Of course, the declarations of the boat hand, made after the occurrence, are incompetent for the purpose of proving the dangerous condition of the bateau. Southerland v. R. R., 106 N.C. 100. But, having been examined by the defendant as its witness as to the condition of the bateau, it was competent to impeach or contradict his evidence upon that point by his declarations on that subject to Glover. To lay the foundation for offering such impeaching evidence, it was proper to ask the witness on cross-examination the question objected to."
(588) (5) The plaintiffs introduced evidence of the value of the property destroyed by the fire. The defendant introduced the complaint, in which it is alleged that this property was valued for taxation at its true value, and then offered the tax list for the purpose of proving the value for taxation to be less than as shown by the evidence for the plaintiffs, which the court excluded.
Authority can be found in support of the general proposition that the tax list is inadmissible upon the question of value, but in none of the cases was the fact present as in this, that the party against whom it was offered had alleged that the tax list showed the true value.
If the plaintiff had made a declaration as to value on the streets, no one would question the right to offer this declaration against him, nor would the right to look at the tax list to ascertain the value be denied if it had been attached to the complaint as an exhibit.
If so, it can make no difference, as to the competency of the evidence, that the true value appeared on the tax list in the office of the sheriff or of the register of deeds instead of attaching the list to his complaint, and in our opinion the evidence ought to have been received.
This entitles the defendant to a new trial, but it is restricted to the issue of damages.
Partial new trial.
Note to opinion of the Court by Mr. JUSTICE ALLEN, showing precedents to sustain the right of the plaintiff to recover under the contract made between the water company and the town:
Gorrell v. Water Supply Co., 124 N.C. 328; Fisher v. Water Co., 128 N.C. 375; Lacy v. Webb, 130 N.C. 546; Gastonia v. Eng. Co., 131 N.C. 368; Wadsworth v. Concord, 133 N.C. 587; Voorhees v. Porter, 134 N.C. 591; Kernodle v. Tel. Co., 141 N.C. 436; Helms v. Tel. Co., 143 N.C. 386; Wood v. Kincaid, 144 N.C. 393; Clark v. Bonsal, 157 N.C. 270; Brady v. Randleman, 159 N.C. 434; Jones v. Water Co., 135 N.C. 553; Mugge v. Tampa Waterworks, 52 Fla. 371; Springfield Ins. Co. v. Graves County Water Co., 120 Ky. 40; Guardian Trust Co. v. Easton, 121 U.S. 391; Wooten v. Hill, 98 N.C. 48.