## Facts

- Albert Peterson shipped a hackney cart by the Denver & Rio Grande Railroad Company to Colorado Springs.
- After delivery, the railroad stored the cart in its freight depot as a warehouseman/bailee.
- A fire at the depot destroyed the cart before Peterson retrieved it.
- Peterson claimed the fire resulted from the railroad’s negligence, including allowing combustible material near the building and permitting sparks or embers from locomotives to ignite it.
- The trial court instructed the jury that the railroad’s duty of care could be determined by (1) the value of property commonly stored/handled and (2) the railroad’s financial ability to build and maintain its facilities and equipment.
- The jury found for Peterson and awarded $85.

## Issues

1. Whether a warehouseman/bailee’s negligence duty of reasonable care may be adjusted based on the defendant’s wealth or financial ability.
2. Whether it was error to instruct the jury that the standard of care depended on the value of goods typically handled and the railroad’s ability to spend on safety.

## Decision

- The Colorado Supreme Court reversed the judgment for Peterson and remanded.
- The court held the jury instruction was erroneous because it allowed the standard of care to vary with the railroad’s wealth and the value of goods.
- The court stated that the care required of a warehouseman is the same regardless of whether the warehouseman is rich or poor.

## Legal Principles

- Negligence uses an objective standard of reasonable/ordinary care under the circumstances.
- A defendant’s wealth or financial ability is not a proper factor for setting the negligence standard of care.
- A warehouseman/bailee owes the same legal duty of care irrespective of economic status; liability is not based on capacity to spend more on safety.
- When an instruction misstates the standard of care by tying it to wealth or value-based measures, reversal is warranted.

## Conclusion

The court reversed because the jury was improperly told to calibrate a warehouseman’s duty of care according to the defendant railroad’s wealth and the value of stored goods; the applicable negligence standard is the same for rich and poor and is judged by ordinary reasonable care under the circumstances.


Denver & Rio Grande R.R. Co. v. Peterson, 30 Colo. 77, 69 P. 578 (Colo. 1902)