Anderson v. . Erie R.R. Co.
223 N.Y. 277, 119 N.E. 557, 1918 N.Y. LEXIS 1180 (1918)
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Rule of Law:
A common carrier may lawfully contractually exempt itself from liability for its own negligence causing injury or death to passengers traveling on reduced-rate tickets, provided the passenger freely and voluntarily accepts such terms, as this constitutes a special contract and not a public duty of carriage for hire.
Facts:
- A clergyman (plaintiff's intestate) obtained a written order from the Erie Railroad Company allowing him to purchase a clerical ticket at a reduced rate at any time during 1913 for his personal use.
- On November 10, 1913, the clergyman presented this order and purchased a ticket from the defendant’s agent in Elmira, N.Y., to Leroy, N.Y.
- He paid $1.20 for the ticket, which was a reduced rate compared to the regular fare of $2.35.
- The back of the ticket contained a condition stating that in consideration of the reduced rate, the user expressly agreed to assume all risk of accidents and damage, whether caused by the company’s or its agents’ negligence or otherwise.
- The clergyman signed the ticket, indicating his agreement to these conditions.
- While the clergyman was traveling on the train, the car in which he was riding was derailed, and he was killed.
Procedural Posture:
- The plaintiff's action for damages for wrongful death was brought in a trial court (court of first instance).
- The trial court jury rendered a verdict for the plaintiff, and judgment was entered.
- The defendant appealed the judgment to the Appellate Division (intermediate appellate court).
- The Appellate Division reversed the judgment and ordered a new trial, finding for the defendant.
- The plaintiff, as appellant, gave the usual stipulation for judgment absolute and appealed the Appellate Division's order to the Court of Appeals of New York (highest court).
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Issue:
Does an agreement by a railroad company to sell a ticket at a reduced rate of fare, in consideration of the passenger’s release of the railroad from liability for negligence, prevent a recovery for injuries or death caused by the railroad’s negligence?
Opinions:
Majority - McLaughlin, J.
Yes, an agreement to release a railroad company from liability for negligence in consideration of a reduced-rate ticket does prevent recovery. The Court of Appeals found no reason to distinguish between a passenger traveling on a free pass, for whom such waivers of liability have long been held valid (citing Wells v. N. Y. C. R. R. Co. and numerous other precedents), and one traveling on a reduced-fare ticket. In both instances, the railroad is not acting as a common carrier for hire in the same capacity as it would for a full-fare paying passenger. The court reasoned that if parties are permitted to make such contracts at all, they are the sole judges of the amount of consideration (whether a full waiver or a partial reduction in fare). The passenger freely and voluntarily chose to accept the privilege offered by the reduced rate and its accompanying conditions. The intestate, described as an intelligent man, deliberately and voluntarily entered into the agreement, and his signature on the ticket provided clear evidence of his full knowledge and appreciation of the terms. The court also presumed compliance with statutory regulations for filing tariffs for such tickets.
Dissenting - Chase, Hogan and Crane, JJ.
Chase, Hogan, and Crane, JJ., dissented without providing a separate written opinion in the provided text.
Analysis:
This case significantly reinforces the principle of freedom of contract, particularly in the context of common carriers limiting liability for non-full-fare passengers. It clarifies that a partial reduction in fare is treated similarly to a complete waiver of fare (a free pass) when determining the validity of exculpatory clauses. The ruling establishes a precedent for upholding contractual waivers of negligence liability for passengers who receive special concessions, distinguishing these situations from regular fare-paying passengers, where common carriers generally cannot contract away liability for their own negligence due to public policy concerns.
