Brooklyn Elevated Railroad v. Brooklyn, Bath & West End Railroad , 48 N.Y.S. 665 ( 1897 )

Bradley, J. :

The railroads of the plaintiff and the Atlantic Avenue Company extended from the Brooklyn Bridge.and other points southerly into and along Fifth avenue to or near Thirty-seventh street, in the city of Brooklyn, and the railroad of the defendant Brooklyn, Bath and West End Railroad Company (hereinafter referred to as the West End Company) extended from near Thirty-seventh street southerly to Coney Island.

The controversy arises out of an alleged breach by the defendants of a contract of date April 30,1895, made between the plaintiff and the defendants, the West End Company'and tile Atlantic Avenue Company for a close connection, for the term of twenty years, to be made between the railroads of those companies at or near Thirty-seventh street and Fifth avenue, with a view to facilitate the interchange of passengers taken to and proceeding from that point of connection. The parties defendant to the contract agreed that their •trains should stop at a designated place of connection at least one-half minute; that through their employees, on the arrival there of their cars, it would announce that “ Connection is to be had with the routes of The Brooklyn Elevated Railroad, to the Brooklyn Bridge, Fulton Ferry and the Eastern District of Brooklyn, as well as to points south ; ” that no discrimination in the rate of fares would be made in favor of passengers reaching that point over the road of the Atlantic Avenue Company, or any other railroad company, and against the passengers of the plaintiff, which would in any way fix the rate of fare from any point reached by any of the roads of the Atlantic Avenue Company, or any other railroad company, to or from any point beyond Thirty-seventh street and Fifth avenue, reached by the route of the West End Company, so that it should be less than the rate of fare charged to a passenger transferring from or to the routes of the plaintiff’s railroad, unless the parties defendant to the contract should be compelled by law to transport passengers over both their routes for a single fare of five cents; that during the continuance of the agreement they would maintain the connection between their railroads at- Thirty-seventh street and Fifth avenue, and would not make any connection at any other point between the-railroad of the West End Company and the Fifth avenue route of the Atlantic Avenue Company, and that in case they should make any connection of their roads with any other routes of the Atlantic Avenue Company or of any other surface railroad company, then the rate of fare via such route or routes and from and over the route of the West End Company to Coney Island and intermediate points, including the rate of fare charged by any other connecting surface lines, should not be less than' the rate of fare charged to passengers using the plaintiff’s route and that of the West End Company to or from Coney Island and intermediate points. This was made conditional upon the maintenance by the plaintiff of its then rate of fare.

The plaintiff on its part agreed that it would stop all the trains “ that are scheduled for points south of Thirty-seventh -street and Fifth avenue on the line of the Sea Side and Brooklyn Bridge Elevated Railroad, at its station on Fifth avenue, between Thirty-sixth and Thirty-seventh streets,” so as to permit all passengers upon its trains desiring to do so,, to take the cars of the other parties to the contract, and that it would announce that “ connection is to be had at that point- for Coney Island and intermediate ■ points via The Brooklyn, Bath and West End Railroad.” It was also agreed that a provision specified should be made for the convenience of passengers in going from the cars of any one of those companies to those of the others, and that signboards should be erected to guide them.

The purpose of this contract, apparently, was for the mutual benefit of the plaintiff and the company operating the West End railroad, to result from transportation of passengers reaching the point of connection on each of those roads and desiring to go southerly or northerly therefrom. At the time the contract was made, ■the rate of fare from points on the plaintiff’s railroad to Coney Island was fifteen cents, of which the plaintiff received five cents and the connecting road the residue.

Before that time the Atlantic Avenue Company had become the lessee of the West End Company, and. it was then understood that the Atlantic Avenue Company intended to connect the two surface roads at the intersection of Fifth avenue and Thirty-seventh street. This was done, thus making a continuous line of railroad over the Atlantic Avenue and the West End roads, from the bridge and other points southerly to Coney Island.

There seems to have been some complaint by the plaintiff that - the Atlantic Avenue Company did that to some extent without observing the provisions of'the contract. But the main alleged cause of complaint occurred later and was attributable to the defendant, the Nassau Electric Railroad Company,' which became the lessee of the West End and Atlantic Avenue railroads, and commenced the operation of them in connection with its system of routes early in April, 1896; and by the lease the Nassau Company assumed, from and after its date, all the obligations of the West End and Atlantic Avenue Companies arising upon the contract before mentioned in reference to making connections, platforms, etc.

Thereafter the Nassau Company constructed a new road constituting an extension of the Atlantic Avenue road on Fifth avenue to a point a considerable distance south of Thirty-seventh street, where it intersected the West End road; and since then the Nassau Railroad Company has run some of its cars over the Atlantic Avenue tracks on Fifth avenue through to Coney Island,, and from there, northerly over the same lines for a single fare of five cents each way, thus reducing the fare, as it was at the time the contract was made, ten cents.

And the evidence tends to prove that those cars did not stop at the stairs constructed by the plaintiff at the station for interchange of passengers, and that no announcement was made as provided by the contract before mentioned.

The question in controversy has relation to the consequence of the non-performance of the stipulations of the agreement made by the Atlantic Avenue and West End Companies which the Nassau Company assumed and undertook to observe. It is suggested by the learned counsel for the defendants that the contract was in violation of the statute which provides that any street surface railroad corporation owning or operating any such railroad in a city having a population of 800,000 or more may contract with any other such corporation for the use of their respective roads (Laws of 1890, chap. 565, § 103); that they shall carry between any two points on the railroads embraced within such contract any passenger desiring to make one continous trip between such points for one single fare not higher than the fare lawfully chargeable by either of such corporations (Id. § 105), and that no corporation operating a railroad under the provisions of this article, or of chapter 252 of Laws of 1884, shall charge any passenger more than five cents for one continuous passage, but this section is not .applicable to any part of any railroad constructed prior to the 6th day of May, 1884, and then in operation. (Id. § 101.)

It is alleged in the complaint, and admitted by the answer, that the West End Company is a corporation organized in November, 1885, and in 1890 was operating a steam surface railroad. And evidence was given to the effect that prior to April 24, 1889, it was operated as a steam surface railroad, and that it was the successor of the old Gunther railroad and had been operated for nearly twenty years. .The statute above referred to not only excludes from the five-cent fare provision railroads constructed prior to May 6, 1884, and then in operation, but includes within the provisions of section 105 those street surface railroads only which are in cities having a population of 800,000 or more. A considerable portion of the West End railroad was not within a city at the time the contract was' made, nor until the 1st of January, 1896, when the boundaries of the city of Brooklyn were so extended as to make them the same as those of the county of Kings. (Laws of 1895, chap. 954.)

In P. P. & C. I. R. R. Co. v. B., B. & W. E. R. R. Co. (84 Hun, 517) it was held that the power of such railroad corporation to contract for the use of another railroad was not dependent upon any . other statutory provisions than those of chapter 218 of Laws of 1839. In that respect that case is not authority applicable to the present case, since the act of 1839 was repealed May 1, 1891. (Laws of 1890, chap. 565, §§ 180, 183.) It would, therefore, Seem that the only authority to make the contract in question was derived - from the provisions of chapter 305 of Laws of 1885, and of chapter 565 of Laws of 1890; and if the West End road were treated as a street surface railroad, within the meaning of the statute, there might be some difficulty in bringing the contract relating to it within the authority given by those or any statutory provisions. But in view of what has already been said about the situation and location of that railroad, it may not be deemed to have been a street surface railroad when the lease of it was made to the Atlantic Avenue Company, or at the time the contract in question was made. The lease or contract for the use of the-West End road may, therefore, come ■ within the authority of section Y8, chapter 565 of the Laws of 1890. In the view taken of it the contract in question is not within any inhibition of the statute.

It is, however, urged on the part of the defendants that the mearn ing and contemplated purpose of the contract was violated by' the plaintiff to their prejudice. This charge is founded on the fact that the plaintiff did not run all of its Fifth avenuet trains to the station called the Union Depot at Thirty-seventh street so as to permit its passengers for Coney Island and intermediate points to take the West End road, but shortly before reaching that street made connection with the Prospect Park and Coney Island railroad 'by means of an inclined plane, and by the latter road the passengers desiring to go- there were taken to Coney Island. In doing this the plaintiff made no connection with the West End road at the Union Depot, nor did it violate the express terms of its agreement, which was that it would stop there all its trains scheduled for points south of Thirty-seventh street and Fifth avenue on the line of the Sea Side and Brooklyn Bridge Elevated railroad so as to permit passengers upon such trains to take the cars of the West End road. This, unless relieved from such imputation by some explanation, would seem to have been such an evasion of the spirit and purpose of the contract as to justify and to fairly require the denial to the plaintiff of any equitable relief founded upon such contract.

The history of the negotiations which resulted in the contract in question goes back to 1889, when a contract was made between the Prospect Park Company and the West End Company for the construction by them of a depot for their joint use and benefit at or near Thirty-sixth street and Fifth avenue, where and at the Coney Island terminus their tracks were to bé connected; and that the proceeds of the transportation of passengers and freight upon the roads between these points were to be divided’between them. It was then contemplated that the Union Elevated road, to which the plaintiff succeeded, might be extended from Twenty-sixth street and Fifth avenue to the depot, and a like provision was made relating, in that event, to the business forwarded to their lines by that railroad.

This contract was merged in and became part, so far as applicable, of a contract made in April, 1890, between those companies and the Union Elevated Railroad Company, reciting that the latter company was proceeding to extend its road on Fifth avenue from Twenty-sixth' street to the depot which the other parties undertook to construct, and the elevated railroad company agreed to erect and maintain a structure for its road in front of the depot. The contract contained provisions for interchange of passengers at that place. The evidence on the part of the plaintiff tends to prove that its road was so extended at the expense of $450,000; that it in Other respects performed the agreement on its part, and that, after the West End road was leased by the Atlantic Avenue Company, it sought to and did, in disregard of the contract, connect the two roads by a line around the depot and taking passengers through to Coney Island at a reduced fare. This was followed by two actions of the Prospect Park and Coney Island Company for injunctive relief against the West End and Atlantic Avenue Companies, which resulted in a recovery by the plaintiff. (84 Hun, 516, 609.) Thereupon the contract in question was made, and one of its purposes was to enable the West End and the Atlantic Avenue Companies, as expressed in the agreement, to discontinue the use of the Union Depot, and instead of that to make surface grade connections of those two roads at the intersection of Fifth avenue andx Thirty-seventh street. This was consented to by the contract and done.

The evidence of .the president of the plaintiff is that, in the negotiation which resulted in the contract in question, and at the time of its preparation, he stated to the counsel for the Atlantic Avenue Company, then the lessee of the West End road, that his company would stop some of its trains before reaching the Union Depot and make connection with the Prospect Park road, but should run just as many trains south of Thirty-seventh street as it generally had; and thereupon the provision was inserted limiting the trains for connection at the Union Depot to those scheduled south of there upon the Sea Side, railroad, which was operated by the plaintiff and extended some distance southerly. The circumstances tend to show that there was no covert advantage intended or realized by the connection made by the plaintiff with the Prospect Park road, and the fact that the usual number of plaintiff’s trains were run to the Union Depot lias the support of evidence.

While it may be, as claimed on the part of the defense, that the expense incurred by the plaintiff in the extension óf the line of its road may not be entitled to the significance sought to be given it as an element of consideration for the agreement, since the extension was necessary to the connection with the Sea Side railroad, the benefits to be derived from the interchange of passengers may have been some inducement to the plaintiff to do it when and as it was done, as well as to make the preparation which was made by it at the depot to facilitate the accomplishment of such purposes. There is no question of consideration requiring attention. Nor is the contract repugnant to any statute.

It is, however, urged with much force and ability by counsel that the contract is void as against public policy, in that its purpose was to control passenger rates, prevent competition, subordinate public accommodation to private interests, and to disable the defendants from the performance of the duties which they, in their relation to the public, assumed. This is based mainly on the fact that the parties, as such corporations, cannot deny to the public the benefit of the contemplated service for which their franchises were granted to them. This is • so, and they have no powers except those derived from their charters and such as are incidental and reasonably essential to the execution of them, and to accomplish the purpose of their creation. Nor can such a corporation transfer or surrender its corporate property or franchises to another, except so far as it is permitted to do so by the statute. But in this State it has been deemed for the public interest to permit railroad corporations to enter into contracts by which one may grant to another the right to use and operate its road and to provide for connections with a view, in practical effect, to unite in one continuous line of railroad the roads of different companies, and as the consequence to make fro rata division between them of the proceeds of the transportation upon the united lines. In this respect there is no limitation, except as to parallel lines.

The leading purpose of the railroads of the parties in the present case was and will continue to be the carriage of passengers. In that view the contract in question was made to so connect, in time at least, the arrival and departure of trains upon the respective lines of road, at the specified place of connection as to practically afford to passengers a continuous passage to their places of destination. This was an accommodation to travel upon those lines of road, and, so far, the arrangement may be deemed commendable rather than objectionable. But it is said that by the contract the parties entered into a combination to keep up a rate of fare regardless of circumstances which might arise to induce some or one of the parties to the contract, if untrammelled by it, to reduce the rate of fare. It ■ may be observed that the fare chargeable upon railroads is so regulated by the statute that the companies cannot charge in excess of a certain rate. There was no provision in the contract for the increase of fare upon any of the roads, nor was there any provision requiring any of the parties to maintain any specific rate of fare.

What the plaintiff required; and to which the other agreed, was that they should make no discrimination in the rate of fare over the West End railroad in favor of any other railroad and against the plaintiff. The parties defendant to the contract were not denied by it the right to carry passengers southerly from the Union Depot at as low a rate of fare as they pleased. All that they agreed to do in that respect was to charge no more for transporting the plaintiff’s passengers than they charged to carry those from any other railroad. This provision of the agreement is not substantially other in its effect than that which provides that in case connection should be made between the West End and the Atlantic Avenue roads, or by them, or either of them, with any surface railroads on any streets other than the Fifth avenue route of the Atlantic Avenue Company, the rate of fare by the way of such route, and from and over the West End route to Coney Island and intermediate points, including the rate charged by any of the other connecting roads should not be less than the rate charged to passengers using the plaintiff’s road and the West End railroad to the same points. The apparent purpose and effect of this provision was that the parties defendant to the contract should not by any connections made by them discriminate against the plaintiff in the rate of fare charged to passengers from any other line of road who were carried on the West End road and to it on the Atlantic Avenue road. This stipulation was also conditional upon the maintenance by the plaintiff of its rate of fare before mentioned. The Atlantic Avenue Company could lawfully charge no more than such rate of five cents on its line. And if by such connection with another road it should become necessary for the Atlantic Avenue and West End roads to reduce the rate of fare charged to passengers received at such connections in order to comply with the stipulation of the contract, it would not be prejudicial to the passengers or to the public. Nothing unreasonable, so far as relates to the, public, appears in these several provisions of the contract. The plaintiff had no concern in the matter of rates of fares charged by the other parties to the contract. They simply in that respect undertook not to discriminate against the plaintiff in consideration of that which the plaintiff did and undertook to do, to facilitate and make connection and interchange of passengers with them.

And the same may be said of the provision of the contract that the West End and Atlantic Avenue roads would make no connection between themselves at any point on the Fifth avenue route of the latter, other than that at Thirty-seventh street, where they agreed to maintain their connection during the continuance of the contract. In this connection it may be observed that the Atlantic Avenue Company was then the lessee of the West End road, and, therefore, for the practical purposes of • their operation, both constituted one line of railroad, and that fact may have had some significance in its application to some of the provisions of the contract, especially that relating to the rate of fares in case of.connection with other surface railroads.

We fail to find in the contract any stipulations which may be deemed as ultra vires, or any the observance of which would result in any unwarrantable monopolizing combination, or in any restraint of the corporate functions which the parties to it, or any of them, should or might lawfully be required to exercise to subserve the public interest. No reason, therefore, appears why we should not follow, as authoritative, the two cases of P. P. & C. I. R. R. Co. v. B., B. & W. E. R. R. Co. (84 Hun, 516, 609).

All the cases cited by the learned counsel for the defendants have been examined, and, while they tend to support his line of reasoning, they are so distinguishable from' the' present case that they do not have any necessary application to the facts as viewed here, upon which its determination must be predicated. It follows that the plaintiff was entitled to injunctive relief. But the judgment, in that respect, should be so modified as to enjoin the defendants from violating the contract, as specified in the judgment, rather than enjoining them, as it does, from operating their lines of road until they do cease such violation. This may in some sense be more formal than substantial; yet it is preferable, as it requires them, in the operation of the roads, to do it only in compliance with the provisions of the contract; and, in thus enjoining the defendants, the court is acting advisedly as to the extent of the relief in that respect granted. It is not seen that the judgment as entered may not be broader, in its effect, than the purposes in view fairly require or justify.

The further relief incidental to that of equitable cognizance and relating to the damages for ' the alleged breach of the contract and the recovery had of them, presents a question not free from doubt and difficulty upon the evidence. And the fact that it is difficult to ascertain and estimate the damages furnishes a reason in support of the equitable remedy. A careful examination of the .evidence does not enable us to reach a very satisfactory conclusion as to the amount of the loss suffered by the plaintiff for the alleged cause.

The evidence on- the part of the plaintiff on the subject related simply to the reduction of the passenger traffic of the plaintiff during the eight months from April to November, 1896, inclusive, from the connection with the West End railroad, as compared with that during the same months in 1898, as represented by the number of tickets sold at the Thirty-sixth street and Fifth aveuue station. The tables of figures presented by the evidence tended to show that the falling off in the number of passengers going north on the plaintiff’s road from the West End road was such as, at five cents each, during the period, in question, would .amount to $13,341, which is said to have been a reduction of fifty-nine and fifty-four one-hundredths per cent in the receipts of the plaintiff therefrom. If all the conditions, except those arising from the violation of the contract, had continued to be the same in 1896 as in the previous year, that statement would have been a reasonably fair basis for estimate. There were in the later year co-operative causes for the diversion of passenger traffic. Amongst them was notably the reduction, early' in 1896> of the rate of fare upon certain lines of the Brooklyn City railroad coming in competition with the West End and Prospect Park railroads.

In obtaining the amount before mentioned, the plaintiff has sought to deduct, and has deducted, the travel derived by the plaintiff’s road from its connection with the Prospect Park and Coney Island railroad in 1895 and 1896, so far as represented.by tickets sold by that company at such station. The evidence in that respect, however, is not very satisfactory since the statement made- by the ■ witness and represented by his figures did not include the through passenger traffic to and from Coney Island over that and the plaintiff’s road, and, therefore, there are no means of determining from the evidence the extent of traffic derived by the plaintiff from the connection of its road with the Prospect Park road. This through travel by way of that road over the plaintiff’s elevated road -is said-to be included in the statement of the number of passengers carried on all its lines, of road exclusive of those taken from that station, in which statement the reduction of the number of its passengers during the same period in 1896, as compared with those of 1895, is represented as sixteen and twenty-one one-hundredths per cent. It is suggested on the part of the plaintiff that the amount before mentioned should be doubled, on the, assumption that the falling off in number of passengers going south over its road was substantially the same and attributable alike to the alleged cause. It is very likely that some passengers who were carried upon the Atlantic Avenue and through on the Nassau would have taken the elevated road to Thirty-sixth street and Fifth avenue station in the absence of the through connection of those surface roads. But if such connection had not been made by them at the reduced rate of fare it cannot, in view of the facilities thus existing, be assumed nor presumed that the most of them would have taken any specific line of railroad. And for that and the further ■ reasons hereinafter stated, the figures before referred to do not, by comparison merely, furnish any satisfactory aid in relation to the passenger travel southerly to that station over the plaintiff’s road during the time in question.

It' may be observed that through passenger service to Coney Island was inaugurated by the plaintiff in May, 1896, and less fare was charged on its through trains than the rate was through the connection with the W est End road at the time the contract in question was made, and as it does not appear how much travel there was on these through trains over the plaintiff’s Fifth avenue and Prospect Park line in 1896, it cannot be seen how much was by that cause diverted from the West End road, and it is equally difficult to surmise how much the traffic on the latter road may by that means have been reduced if the Nassau connection and its reduction of fare had not been made. There certainly would have been much reason to suppose that the through route of the plaintiff by way of the Prospect Park road would have been preferable to the transfer connection with the West End road even at the same rate of fare, and more so. with that rate reduced as it was, although not as low as on the Nassau cars. This was applicable both ways. And it reasonably may be treated as a significant co-operative cause for the reduction of the traffic on the West End road in 1896. For the reasons before given, no means for information of the travel over or from the Prospect Park road in connection with the plaintiff’s Fifth avenue line are furnished by the evidence. It is quite evident that if the through train system had not been adopted by the plaintiff, the number of tickets sold by the Prospect Park Company at the Thirty-sixth street station- for deduction from the number sold there by .the West End Company in 1896 less than in 1895 would have been considerably increased, and thereby the sum before mentioned considerably reduced.

By reference to the table of figures, it appears that the number of tickets sold by the Prospect Park Company in April, 1896, was substantially the same as in April, 1895, andi there was some falling off in May and a very great falling off in the months following it in 1896, to and including November; the percentage of it was very much more than was the reduction in number of tickets sold during the same time by the West End Company at that station. How much of this was attributable to the plaintiff’s through trains over the Prospect Park road is a subject of inquiry as to which the evidence furnishes no satisfactory answer.

While the fact that the proof and estimate of damages resulting from a breach of a contract may be difficult is no reason why a recovery should be denied, there must, nevertheless; be reasonable support in the evidence and the inferences derivable from it for the amount awarded. (Wakeman v. Wheeler & Wilson Mfg. Co., 101 N. Y. 205.) The plaintiff’s loss from the alleged cause during the eight months preceding the trial is so difficult to determine that the estimate of damages must be founded on data not demonstrable to entire satisfaction. And while it cannot be definitely said that they may or may not have amounted to the sum of $15,000 awarded by the trial court, -we are able to make some deductions, which appear to us somewhat reasonable from the evidence, that the pércentage of loss'was such as to require the reduction of the plaintiff’s recovery to $10,000.

If the defendants liad so desired, this issue upon their application could, by the direction of the court, have been tried by jury. (Lynch v. M. E. R. Co., 129 N. Y. 274.)

The injunctive relief granted by the judgment should be modified as above suggested, and the damages recovered reduced to $10,000,- and as so modified the judgment should be affirmed.

All concurred, except. Cullen, J., not sitting.

Injunctive relief granted by the judgment modified as directed in the opinion, and the damages recovered reduced to> $10,000 and extra allowance jiroportionately,, and as so modified the judgment is affirmed, without costs of this appeal to either party.