Insurance Company v. Railroad Company

• Decision Date: 01 October 1881
• Parties: INSURANCE COMPANY v. RAILROAD COMPANY
• Court: U.S. Supreme Court

104 U.S. 146

104 U.S. 146

26 L.Ed. 679

INSURANCE COMPANY v. RAILROAD COMPANY.

October Term, 1881

ERROR to the Circuit Court of the United States for the Eastern District of Missouri.

The facts are stated in the opinion of the court.

Mr. John G. Chandler for the plaintiff in error.

Mr. John G. Williams, contra.

MR. JUSTICE HARLAN delivered the opinion of the court.

The cotton, for the recovery of the value of which this action was brought against the St. Louis, Vandalia, Terre Haute, and Indianapolis Railroad Company, the defendant in error, was, at the time of shipment, owned by Adolphus Meir & Co., of St. Louis, who, for a valuable consideration, have assigned to the St. Louis Insurance Company, the plaintiff in error, all their claim on account of the said loss. The parties having, by proper written stipulation, waived a jury, the case was tried by the court, and judgment given for the railroad company.

The facts set forth in a special finding, covering many pages of the printed transcript, so far as they are deemed essential to a clear understanding of the case, are as follows:—— The Erie and Pacific Despatch Company, a Kansas corporation, having agencies in different cities of the Union, and whose business it was to solicit and forward freights over trunk railroad lines between St. Louis and New York, received the cotton in question from Meir & Co., under agreements for its transportation to Liverpool, for a through rate, expressed in English money. No direction was given as to the route over which it should be carried to the seaboard, nor were any bills of lading then executed.

The St. Louis Transfer Company, having received from the despatch company the warehouse receipts, and having been engaged by it for that purpose, hauled the cotton to East St. Louis, and there delivered it, on account of that company, to the defendant, taking receipts therefor. By the dray tickets of the transfer company the cotton was consigned by the despatch company to C. G. Meir & Co., London. The defendant had not, on previous occasions, issued bills of lading for freight shipped over its line by the despatch company, nor did it do so for any part of these shipments. But, in accordance with its custom, it made a way-bill for the cotton to Indianapolis. The cotton was carried safely over the defendant's road from East St. Louis to Indianapolis; thence, pursuant to directions of the despatch company, and without change of cars, over the Pittsburg, Cincinnati, and St. Louis Railroad to Urbana, Ohio, where it was put into other cars suitable to the change of gauge at that point; and thence over the Atlantic and Great Western Railroad and the Erie Railway to Jersey City.

The cotton was destroyed by an accidental fire which occurred in Jersey City on the 21st of March, 1873.

Within the usual time after the respective shipments from East St. Louis the despatch company executed and delivered to Meir & Co., of St. Louis, bills of lading for the cotton. Each bill disclosed the quantity of cotton, its destination, the names of the consignors and consignees, the agree rates in English money, and purported to be the 'Through bill of lading of the Erie and Pacific Despatch, and the Oceanic Steam Navigation Co. from St. Louis to Liverpool, calling at Queenstown.' With the last-named company, known as the White Star Line the despatch company had an arrangement by which it could contract for shipments from New York to Liverpool at rates given by the steamship line, the latter agreeing to receive the goods at its dock in Jersey City, and transport them to Liverpool. But the despatch company had no power to bind the steamship line for any risks incurred in the inland transportation, nor did it receive from the line any commission or other compensation. Its remuneration came exclusively from certain arrangements with railroad companies, to which we shall presently refer.

The bills of lading delivered to Meir & Co. contained, among other provisions, the following:——

'That the said Erie and Pacific Despatch and its connections which receive said property shall not be liable . . . for loss or damage by . . . fire . . . nor for damage to perishable property of any kind occasioned by delays from any cause; . . . nor for loss or damage on any article of property whatever by fire or other casualty while in transit, or while in deposit or in places of transshipment or at depots or landings at all points of delivery. . . .

'It is further agreed that said Erie and Pacific Despatch and its connections shall not be held accountable for any damage or deficiency in packages after the same shall have been receipted for in good order by consignees, or their agents, at or by the next carrier beyond the point to which the bill of lading contracts. Consignees are to pay freight and charges upon the goods or merchandise in lots or parts of lots as they may be delivered to them.

'It is further stipulated and agreed, that in case of any loss, detriment, or damage done to, or sustained by any of the property herein receipted for during such transportation, whereby any legal liability or responsibility shall or may be incurred, that company alone shall be held answerable therefor in whose actual custody the same may be at the time of the happening of such loss, detriment, or damage, and the carrier so liable shall have the full benefit of any insurance that may have been effected upon or on account of said goods.

'And it is further agreed, that the amount of the loss or damage so accruing, so far as it shall fall upon the carriers above described, shall be computed at the value or cost of said goods or property at the place and time of shipment under this bill of lading.

'This contract is executed and accomplished, and the liability of the Erie and Pacific Despatch as common carriers thereunder terminates, on the delivery of the goods or property to the steamship at White Star wharf, Jersey City, when the liability of the steamship company commences, and not before.

* * *

'NOTICE.—In accepting this bill of lading the shipper, or other agent of the owner of the property carried, expressly accepts and agrees to all its stipulation, exceptions, and conditions.'

The right of recovery in this case against the defendant is rested by the plaintiff in error in part, if not altogether, upon certain business relations existing at and before the time of these shipments, as well between the despatch company and the railroad companies over whose lines the cotton was carried, as between the railroad companies themselves. It is necessary, therefore, to ascertain what were the precise relations held by these several corporations to each other.

During the period covered by these transactions, and for some time prior thereto, the Erie and Pacific Despatch Company had arrangements with sundry railroads having connections terminating in New York, under which it was empowered to contract for the transportation of goods according to the tariff rates, or any special rates furnished by the respective railroad companies. It had a separate agreement with each of the railroad companies already named, in some cases oral, in others written. The agreement with the Erie Railway Company was in writing, and, among other things, provided that the despatch company should establish and maintain, at its own expense, independent and efficient agencies for soliciting and procuring freight, in the cities of New York and Boston, and in other cities, east and west, as the parties might deem necessary; that the railway company should transport all through freight secured by the despatch company, either eastward or westward bound, passing between Philadelphia, New York, Jersey City, Albany, Boston, and common or competing points in New England, and common or competing points on the line of the Erie Railway, except that on east bound freight the despatch company should not receive any commission on shipments from any station on the line of that railway; that the despatch company should issue its own bills of lading to shippers subject, as to rates, to the current through rates of the railway company, which should at all times be as low as the rates furnished to any other party or parties; that the railway company should receive, load and unload, deliver and way-bill, and furnish daily an impression copy of each way-bill, of both eastward and westward bound freight, free of charge, to the despatch company; that the railway company agreed to assume 'all the risks of common carriers, and to pay all damage to or loss of property while on their line of road or in their possession,' and in case property was lost or damaged, and the loss and damage could not be definitely located, the railway company should pay said loss in proportion to what was received for transporting the same, subject, however, to the liability limitations contained in the bills of lading of the despatch company; that the railway company should transport all freight known as first-class freight on the fastest freight trains running over its road, and so run the same and all through freight trains so as to enable the despatch company to deliver freight between competing points, in the east or west, as quickly as it was done by any other competing line or road; that the despatch company should maintain the authorized rates of the railway company, and be governed, in the transportation of through business, by any obligations entered into by the railway company with their competing lines for the maintenance of rates; and that the railway company should give to the despatch company at all times as low rates as were given to any other line running over the road of the former, and would prorate any rate on east bound freight, made by authority of the road leading from the point, provided that road was authorized to make through rates over the Erie Railway; and that they would prorate all losses, damages, and rebates that...