American Mach. & Foundry Co. v. Santini Bros., Inc.

• Court: New York Supreme Court
• Writing for the Court: MATTHEW M. LEVY
• Citation: American Mach. & Foundry Co. v. Santini Bros., Inc., 283 N.Y.S.2d 574, 54 Misc.2d 886 (N.Y. Sup. Ct. 1967)
• Decision Date: 18 September 1967
• Parties: AMERICAN MACHINE & FOUNDRY COMPANY, Inc., Plaintiff, v. SANTINI BROS., INC., Defendant.

Page 574

283 N.Y.S.2d 574

54 Misc.2d 886

AMERICAN MACHINE & FOUNDRY COMPANY, Inc., Plaintiff, v. SANTINI BROS., INC., Defendant.

Supreme Court, Trial Term, New York County, Part V.

Sept. 18, 1967.

Rein, Mound & Cotton, New York City (Eugene A. Leiman, and Alan J. Rein, New York City, of counsel), for plaintiff.

Bruman & Gates, New York City (Louis B. Bruman, and Richard M. Gates, New York City, of counsel), for defendant.

MATTHEW M. LEVY, Justice.

The plaintiff was the owner of certain heavy-duty machinery and equipment known as aircraft cargo loader systems. The defendant was and is a common carrier, engaged in interstate commerce, as a household goods mover, operating within the authority of, and the rates specified in, Tariff 78--B of the Household Goods Carriers Bureau, on file with the Interstate Commerce Commission. In May or June of 1961, the defendant entered into a contract with the plaintiff by which the defendant agreed to transport a system from the plaintiff's plants in Stamford, Connecticut, and Brooklyn, New York, to Fort Story in Virginia. Accessory display panels and two tables were included in the shipment. The purpose was to give the plaintiff's personnel at Fort Story an opportunity to present a demonstration of the machinery and equipment to the United States Department of Defense and to military officials there, so as to facilitate the plaintiff's bidding on, and negotiations with the government for, a contract as part of what was called 'Project Mobility'.

The plaintiff did not learn until quite late of the date (June 2nd) scheduled for the presentation and it was therefore rushed in preparing the equipment for transportation and wished to use the quickest means readily available. In normal circumstances, the shipment could or would have been crated and sent by general carrier. However in this situation there was insufficient time to assemble and to crate. The shipment therefore required a padded van for its exclusive use. This method of transportation would also save delay by way of stopover. The plaintiff was informed that the defendant could supply such a vehicle on June 1, which could reach Virginia on the morning of June 2, in time for the demonstration scheduled for that afternoon. Ordinarily, the service of a household-goods carrier includes an experienced staff to remove the shipment from its present premises and to place it in a new location. But, in this instance, the plaintiff was so pressed for time that it had to have its own employees load the equipment at Stamford and it had to have men available at Fort Story to unload and set up the equipment. These arrangements were carried out but, en route, early in the morning of June 2, the van and another vehicle collided, caught fire, and as a result the shipment, was, for all intents and purposes, destroyed.

The plaintiff brought this suit against the defendant for damages amounting to the full value of the machinery and equipment, $30,679.39. The defendant claims that its liability is limited to 30 cents per pound, or, on the basis of a weight of 7,060 pounds, to $2118. The figures as to weight and value were stipulated by the parties, and the remaining issues--of fact and law--were submitted to me for disposition after trial on a non- jury basis. The service and filing of findings of fact and conclusions of law were duly waived.

As a common carrier, the defendant 'is liable for all loss or injury not due to the act of God or the public enemy, the inherent nature or qualities of the goods, or the act or fault of the owner or shipper * * *. Where the loss is not due to the excepted causes, it is immaterial whether the carrier was negligent or not, and the carrier cannot escape liability by proving reasonable care and diligence, or by showing that there was no negligence * * *.' (13 C.J.S. Carriers § 71, p. 132). In short, the carrier is an insurer, and unless there was due limitation of liability, the carrier is liable as such.

Tariff 78--B incorporates what is known in the industry as a 'released rates order', whereby the carrier was permitted to limit its liability provided that it had offered the shipper the choice of requiring the carrier to assume full liability if a higher rate were to be paid the carrier for the transportation. The defendant asserts that the plaintiff accepted the limitation of liability in return for a lower rate, as provided in the tariff. The plaintiff disputes this factually and counters legally that the shipment was not of such a nature as to come within the tariff, and that therefore the defendant is liable for its full value.

At the outset, it is to be noted that the defendant's allegation of limited liability is an affirmative defense, pleaded by the defendant in its answer, and that the burden is upon the defendant to show that the claimed limitation was in effect on this shipment (Farmers' Loan & Trust Co. v. Siefke, 144 N.Y. 354, 360, 39 N.E. 358, 359; Blunt v. Barrett, 124 N.Y. 117, 119, 26 N.E. 318, 319; Moncel Realty Corp. v. Whitestone Farms, 188 Misc. 431, 433, 68 N.Y.S.2d 673, 675, affd. 272 App.Div. 899, 72 N.Y.S.2d 407).

The type of shipment allowed household goods carriers is contained in the tariff itself, and is expressed in the following commodity description (Tariff 78--B, p. 21, item 100):

'(1) PERSONAL EFFECTS AND PROPERTY USED OR TO BE USED IN A DWELLING when a part of the equipment or supply of such dwelling. (Moving households)

'(2) FURNITURE, FIXTURES, EQUIPMENT AND THE PROPERTY OF STORES, OFFICES, MUSEUMS, INSTITUTIONS, HOSPITALS, OR OTHER ESTABLISHMENTS when a part of the stock, equipment, or supply of such stores, offices, museums, institutions, hospitals, or other establishments. (Moving business to new location)

'(3) ARTICLES INCLUDING OBJECTS OF ART, DISPLAYS, AND EXHIBITS, which because of their unusual nature or value require specialized handling and equipment usually employed in moving household goods.' (Catchall--where this specialized carrier could best perform) ¹

Concededly, nothing in paragraph (1) or (2) could fit the instant case, but the defendant asserts that it was informed by the plaintiff that the shipment here involved consisted of displays and exhibits and therefore falls within paragraph (3).

In my view, the defendant's statement of fact is erroneous and its contention on the law is fallacious. The shipper's property was bulky machinery designed for practical industrial use, and the fact that it was to be displayed or exhibited to the military was merely incidental and did not convert the equipment into a mere 'display or exhibit' within the meaning of the tariff. Throughout, it remained 'machinery,' an item which does not fit into paragraph (3). That the defendant constantly refers to the equipment transported as a 'display or exhibit' has no greater efficacy than the assertion of the fictional Bellman that 'What I tell you three times is true'. ² My conclusion, I think, is supported by applicable determinations of the Interstate Commerce Commission and by relevant rulings of a number of courts.

The purpose of the tariff is to limit a carrier's operations to its specialized area, so that it does not infringe on the service and business of other (e.g., non-household goods) carriers. Accordingly the Commission has held general merchandise and equipment not to be within the 'Commodity Description' of 78--B. (Neptune Storage, Inc. Extension, (1950) 7 Federal Carriers Cases 683, and Blanchard Storage Company, Inc., (1949) 7 Federal Carriers Cases 194.)

The Commission has resisted any broadening of item 100, paragraph (3), of the tariff, and indeed has strictly limited its applicability. In Ex Parte M C--19, (1951) 8 Federal Carriers Cases 311, the Commission had before it for determination a request by household carriers to expand Item 100(3) so as to include any uncrated shipment, or any goods for which a shipper requests the use of a household carrier to transport. The Commission expressed the issue and its ruling as follows (at pp. 311--312):

'Petitioners would construe part 3 of the definition to include any uncrated article which is tendered to a household goods carrier for transportation. Such a construction is not warranted by the language of the definition. The Household Goods Carriers' Conference upon exceptions repeatedly contends that its construction of part 3 of the definition is not that household-goods carriers may transport any uncrated article but only uncrated articles which require the specialized handling and equipment usually employed in moving household goods. And the controlling test of whether an uncrated article requires specialized handling and equipment usually employed in moving household goods, according to this party, is the opinion of the shipper. As a practical matter, then, if a shipper tenders for transportation any uncrated article to a household-goods carrier such article would be deemed to require specialized handling and equipment usually employed in moving household goods. Under these circumstances it is plain that petitioner's real position is, as stated, that respondents may transport any uncrated article, as clearly, they can transport property only when it is offered for transportation.'

After reviewing the definitions of the type of service household goods carriers provided, the Commission disagreed with the petitioners' position, rejected their request, kept the definition intact and refused to broaden the rules interpretation.

The findings of the Commission were set forth as follows (p. 317):

'Interpretations--Use to narrow or enlarge rights prohibited. The primary purpose in seeking a modification or construction of rule 1(a) which would encompass nearly all uncrated commodities is to broaden the type of service that may be rendered by carriers holding authority to transport household goods. As seen, the definition is clear, reflects the intent of the Commission, and adequately...