Tallyho Plastics v. Big M Constr.
| Decision Date | 29 December 1999 |
| Citation | 8 S.W.3d 789 |
| Parties | (Tex.App.-Tyler 1999) TALLYHO PLASTICS, INC., APPELLANT v. BIG M CONSTRUCTION COMPANY, MACHINERY TRANSPORTATION, INC. AND MARK ROBINSON BUNT, APPELLEES NO. 12-98-00266-CV |
| Court | Texas Court of Appeals |
APPEAL FROM THE SECOND JUDICIAL DISTRICT COURT OF CHEROKEE COUNTY, TEXAS
[Copyrighted Material Omitted] Panel consisted of Ramey, Jr., C.J., Hadden, J., and Worthen, J.
OPINION ON MOTION FOR REHEARING
Appellees Machinery Transport, Inc. and Mark Robinson Bunt filed a motion for rehearing in this matter. They urged this Court to rehear its September 30, 1999, decision to render judgment in favor of Tallyho Plastics, Inc. against Machinery Transport and Bunt. We now grant their motion. This court's previous opinion of September 30, 1999, is withdrawn, and the following opinion issued.
This is an appeal from a judgment in a suit for damages to a plastics injection molding machine owned by Tallyho Plastics, Inc. Tallyho appeals the trial court's judgment which failed to award attorney's fees on its breach of contract claim against Big M Construction Company, Inc. Big M files cross-issues complaining that the suit was tried under an incorrect theory of recovery, that there was insufficient evidence that Machinery Transport, Inc. and Mark Bunt were not also liable for the breach of contract, and of charge error on the damage question. We render judgment in favor of Tallyho against Machinery Transport and Bunt. As to Tallyho's judgment against Big M, it is in all things affirmed.
Tallyho's plastics injection molding machine was in transport from Omaha, Nebraska to Jacksonville, Texas when the truck hauling the machine was involved in an accident. Tallyho filed suit for damages as a result of the accident under theories of violation of the Deceptive Trade Practices Act, breach of contract, negligence, violation of the Motor Carrier Act, negligent misrepresentation and violation of the Carmack Amendment. The claims were asserted jointly and severally against Big M, Machinery Transport, and Bunt. The court rendered judgment on the jury's verdict providing that Tallyho was entitled to damages from Big M only in the sum of $97,000.00 and pre-judgment interest.
According to the record, Tallyho is a manufacturer of molded plastic products. It utilizes certain large pieces of equipment in the manufacturing process. One such piece of equipment is an injection molding machine. In 1995, Tallyho was in the process of having a 500 ton Reed injection molding machine rebuilt at Battleston Industries in Omaha, Nebraska. Tallyho sought out Big M to set the machine when it arrived at its Jacksonville, Texas plant. During their negotiations, representatives of Tallyho and Big M also discussed the transportation of the machine from Nebraska to Texas. It is disputed whether Tallyho eventually agreed to have Big M transport the machine or hire a carrier to do so. Big M contacted a broker and an agreement was made that Machinery Transport would pick up the machine in Omaha and transport it to Jacksonville for $1,600.00. Tallyho agreed to pay Big M $1,800.00 for the pick up and delivery.
On April 6, 1995, Bunt, a driver and employee of Machinery Transport, was dispatched to pick up the machine at Battleston Industries. Bunt began the transport, but was involved in an accident in Oklahoma. The Tallyho machine received extensive damage when the truck and trailer turned on their sides and slid. The machine was not delivered to Tallyho, but was eventually delivered back to Battleston Industries by Machinery Transport.
We will first address Big M's cross-issues. Over Big M's objection, the case was tried under both Texas statutory and common law causes of action. Big M, Machinery Transport and Bunt all argued that the case should be tried under the Carmack Amendment only. The Carmack Amendment governs a motor carrier's liability to a shipper, consignor, holder of bill of lading, persons beneficially interested in the shipment although not in possession of the actual bill of lading, buyers or consignees, or assignees thereof for the loss of, or damage to, an interstate shipment of goods. See Harrah v. 3M and RPS, 809 F.Supp. 313, 318 (D.N.J.1992). A pertinent provision of the Amendment reads in part:
[A] carrier or freight forwarder and any other common carrier that delivers the property and is providing transportation or service subject to the jurisdiction of the [Interstate Commerce] Commission under subchapter I, II, or IV are liable to the person entitled to recover under the receipt or bill of lading. The liability imposed under this paragraph is for the actual loss or injury to the property . . . .
49 U.S.C. 14706.
The United States Court of Appeals for the Fifth Circuit has held that the purpose of the Carmack Amendment is to "substitute a paramount and national law as to the rights and liabilities of interstate carriers subject to the Amendment." Moffit v. Bekins Van Lines, 6 F.3d 305, 306 (5th Cir. 1993), citing Air Products 7 Chemicals v. Illinois Cent. Gulf R.R., 721 F.2d 483, 486 (5th Cir. 1983), cert. denied, 469 U.S. 832, 105 S.Ct. 122, 83 L.Ed.2d 64 (1984). The Carmack Amendment subjects a motor carrier transporting cargo in interstate commerce to absolute liability for "actual loss or injury to property." See Missouri Pacific R.R. Co. v. Elmore & Stahl, 377 U.S. 134, 137, 84 S.Ct. 1142, 12 L.Ed.2d 194 (1964). By limiting a carrier's liability to the actual loss or injury to the transported property, Congress intended to provide certainty to both shippers and carriers, and to enable carriers to assess their risks and predict their liability for damages. Hughes v. United Van Lines, 829 F.2d 1407, 1415 (7th Cir. 1987), cert denied, 485 U.S. 913, 108 S.Ct. 1068, 99 L.Ed.2d 248 (1988); Counter v. United Van Lines, Inc., 935 F.Supp. 505, 507 (D.C.Vt. 1996). If a transaction is governed by the Carmack Amendment, state and common law causes of action involving the same transaction are preempted by the Amendment. See Accura Systems, Inc. v. Watkins Motor Lines, Inc., 98 F.3d 874, 876 (5th Cir. 1996); Moffit, 6 F.3d at 307.
Big M argues on appeal that the parties in this case are governed by the Carmack Amendment since it applies to shippers, carriers, freight forwarders and lessees when transporting people or property across state lines. See 49 U.S.C. 10101 et. seq. Owners of property who seek interstate transportation of that property are considered shippers which are governed by the Carmack Amendment. See Hiram Walker and Sons, Inc. v. Kirk Line, 877 F.2d 1508, 1511 (11th Cir. 1989). In the present case, Tallyho owned the injection molding machine and sought transport of this machine from Nebraska to Texas. Thus, the posture of Tallyho as owner placed it within the protections of this act, and the capacity in which Big M acted in the transaction is non-determinative of the issue.
Tallyho, on the other hand, maintains that its claims against Big M were not governed by the Amendment because Big M conceded at trial that it was not authorized to transport goods between states. Big M also asserted that it never intended to transport the machine involved in this case. Further, Big M did not possess a certificate authorizing it to engage in transportation in interstate commerce. Additionally, we note that Big M did not "ship" the machine, it was not a consignor or a consignee, nor was it certified to act as a broker or a freight forwarder. Thus, Tallyho argues that Big M was not entitled to rely upon the Carmack Amendment in this case.
We agree with Tallyho that the capacity in which Big M acted within the transaction is determinative of the issue. We note, however, that the Interstate Commerce Act defines a "broker" as "a person, other than a motor carrier or an employee or agent of a motor carrier, that as a principal or agent sells, offers for sale, negotiates for, or holds itself out by solicitation, advertisement, or otherwise as selling, providing, or arranging for, transportation by motor carrier for compensation." 49 U.S.C. 13102(2). In other words, a broker is a party who, for compensation, arranges, or offers to arrange, the transportation of property by an authorized motor carrier. Although a broker is required to be certified under the Interstate Commerce Act, a party's failure to have certification does not determine his status as a broker under the Carmack Amendment. See Ford v. Tandy Transportation, 86 Ohio App. 3d 364, 377, 620 N.E.2d 996 (Ohio Ct. App., Lawrence County, 1993).
Under the facts of this case, we conclude that Big M was acting as a broker between Tallyho and Machinery Transport. Thus, Tallyho's state and common law causes of action against Big M are preempted by the Carmack Amendment. And it is undisputed that Machinery Transport was a common carrier, and was acting as such when it undertook to transport the injection machine from Nebraska to Texas. Therefore, Tallyho's state and common law causes of action against Machinery Transport are also preempted. Consequently, the trial court erred when it refused Big M's and Machinery Transport's requests that they be subject only to damages under the Carmack Amendment.
Big M argues that the trial court's jury charge error resulted in reversible error under Rule 44 of the Rules of Appellate Procedure, which provides the following:
44.1 Reversible Error in Civil Cases.
(a) Standard for Reversible Error. No judgment may be reversed on appeal on the ground that the trial court made an error of law unless the court of appeals concludes that the error complained of:
(1) probably caused the rendition of an improper judgment; . . .
In order to determine whether an error in the jury charge is harmful, an appellate court must consider the pleadings...
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