Atchison, Topeka Santa Fe Railway Company v. Harold

• Decision Date: 05 June 1916
• Docket Number: No. 347,347
• Parties: ATCHISON, TOPEKA, & SANTA FE RAILWAY COMPANY, Plff. in Err., v. J. R. HAROLD
• Court: U.S. Supreme Court

241 U.S. 371

36 S.Ct. 665

60 L.Ed. 1050

ATCHISON, TOPEKA, & SANTA FE RAILWAY COMPANY, Plff. in Err.,

v J. R. HAROLD.

No. 347.

Argued May 2, 1916.

Decided June 5, 1916.

Messrs. Alfred A. Scott, William R. Smith, Robert Dunlap, and Gardiner Lathrop for plaintiff in error.

Messrs. Ray Campbell, W. A. Ayers, and J. Graham Campbell for defendant in error.

Mr. Chief Justice White delivered the opinion of the court:

We are of the opinion that a motion to dismiss is without merit, but the reasons which lead us to that conclusion will be more clearly appreciated after we have made a statement of the case. Until that is done we hence postpone the subject.

J. Bell & Son, having sold a carload of bulk corn to the C. V. Fisher Grain Company, residing and doing business at Kansas City, Missouri, on September 21, 1910, shipped the same from Yanka, Nebraska, over the Union Pacific Railroad. The bill of lading identified the car as L. W. No. 33,791, containing 100,420 pounds of corn, and the same was consigned to Topeka, Kansas, to the order of the consignors (Bell & Son), with a direction, however, in the bill of lading, to 'notify C. V. Fisher Grain Company, care of Santa Fe, for shipment.' A draft for the purchase price of the corn was mailed to Kansas City, Missouri, accompanied with the bill of lading, indorsed over to the order of the Fisher Grain Company, and on the presentation of this draft to the Grain Company at Kansas City, Missouri, while the car was yet in transit, it paid the same and became the possessor and owner of the bill of lading. On the 24th of September the Grain Company surrendered to an agent of the Santa Fe at Kansas City, Missouri, the Yanka bill of lading which it had thus acquired, and took in exchange for it another bill, consigning the identical car to their own order at Elk Falls, Kansas, a place on the Santa Fe road, with a direction, however, to notify at Elk Falls the Nevling Elevator Company. This bill of lading was dated the same day as the original bill for which it was exchanged; that is, September 21st, although it was in fact only signed and issued on the 24th of that month; and although on its face it treated the car as being at Kansas City, in reality the car was in transit from yanka, not having yet reached Topeka.

Harold, the defendant in error, a grain dealer at Wichita, Kansas, who had sold on September 15th a carload of corn to Shoe & Jackson at Elk Falls, to be shipped or delivered in a stated number of days, bought the carload of corn described by the bill of lading issued at Kansas City, and, paying a draft for the purchase price drawn by Fisher Grain Company, with the bill annexed, he became the owner of the bill, and directed that delivery of the corn be made to Shoe & Jackson. The car from Yanka had then not yet been delivered to the Santa Fe at Topeka, having reached that point only on the 28th of September, on which day it was offered to the Santa Fe for carriage and delivery at Elk Falls. Finding that the car was in bad order, the delivery was declined, and the car turned back to the Union Pacific. That road, discovering that the damage was such that the car could not be repaired while it was loaded, sent it to an elevator, transferred the grain to another car, S. P. No. 85,721, and turned that car over to the Santa Fe. The new car, however, did not contain the exact quantity of grain originally shipped from Yanka, as one of the defects in the old car was a leaky door, and several hundred pounds of the corn had been lost in transit. The car was promptly carried by the Santa Fe to Elk Falls and offered for delivery, but as the period for the fulfilment by Harold of his contract with Shoe & Jackson had elapsed, and there had been a decline in the market price of corn, the latter refused to take the car. Thereupon this suit against the Santa Fe was commenced by Harold to recover the loss which he had suffered by the alleged unreasonable delay in delivery at Elk Falls, consisting of three items: first, the difference between the price at which the corn had been contracted to be sold to Shoe & Jackson and the market price at the date the car was offered for delivery; second, the amount of the freight paid on the corn which had been lost; and third, a reasonable attorney's fee which it was alleged a statute of the state of Kansas authorized to be recovered in case of delay of a carrier in the delivery of grain.

In its defense the company alleged the shipment over the Union Pacific from Yanka, averred that the corn was received by it at Topeka in order to complete the transportation to Elk Falls, and charged that, by a condition of the bill of lading issued at Kansas City, as the delay had been wholly caused by the Union Pacific, there was no liability on the part of the Santa Fe, and that, besides, that company was not liable, because of a failure to give a notice of claim in compliance with a condition which was also contained in the Kansas City bill of lading. There was judgment in the trial court for the plaintiff, and the judgment of the court below, affirming such action, is the one now under review.

The court, after referring to the bill of lading sued on (the one issued at Kansas City), and after stating that 'the shipment intended to be described in the bill of lading originated at Yanka, Nebraska, on the Union Pacific Railway,' proceeded to state the facts which we have recapitulated, and which had been admitted in evidence without objection. In substance conceding that if the facts stated were made the test of the rights of the parties the judgment under review was wrong, because there had been, as a matter of fact, no unreasonable delay in delivering the corn by the Santa Fe, it was held that the judgment rendered was right, since the plaintiff below, as the purchaser of a bill of lading for value, had a right to rely upon the face of the bill, to treat the corn as having been received by the carrier at Kansas City on the date the bill of lading was issued, and therefore to recover for the unreasonable delay in delivery which necessarily would result from excluding from view the facts concerning the movement of the corn from Yanka, Nebraska, and the date of its delivery at Topeka to the Santa Fe. The essence of the opinion was aptly summed up in the syllabus which preceded it, drawn by the court, which is as follows:

'1. The rule which invests the innocent holder of a bill of lading with rights not available to the shipper, declared in Wichita Sav. Bank v. Atchison, T. & S. F. R. Co. 20 Kan. 519; Missouri, K. & T. R. Co. v. Hutchings, 78 Kan. 758, 99 Pac. 230; and Hutchings v. Missouri, K. & T. R. Co. (Sealy v. Missouri, K. & T. R. Co.) 84 Kan. 479, 41 L.R.A.(N.S.) 500, 114 Pac. 1079, is followed in a case where the plaintiff purchased corn described in a bill of lading, and paid the...