Denning Warehouse Co. v. Widener

• Decision Date: 04 February 1949
• Docket Number: No. 3717.,3717.
• Citation: 13 ALR 2d 669,172 F.2d 910
• Parties: DENNING WAREHOUSE CO. v. WIDENER et al.
• Court: U.S. Court of Appeals — Tenth Circuit

13 ALR 2d 669, 172 F.2d 910 (1949)

DENNING WAREHOUSE CO. v. WIDENER et al.

No. 3717.

United States Court of Appeals Tenth Circuit.

February 4, 1949.

John Eberhardt and George Siefkin, both of Wichita, Kan. (T. E. Mears, Sr., of Portland, N. M., and William A. Sloan, of Albuquerque, N. M., on the brief), for appellants.

G. L. Reese, Sr. and N. Randolph Reese, both of Roswell, N.M., for appellees.

Before PHILLIPS, Chief Judge, and BRATTON and MURRAH, Circuit Judges.

MURRAH, Circuit Judge.

The appellees here sued the appellant Warehouse Company, a Kansas corporation, and Mose B. Jones, resident of New Mexico, alleging the commercial bailment of broomcorn in the Company's warehouse, supervised by Jones, the payment of the charges, demand and refusal of redelivery, and prayed damages for its value. The case was removed to the federal court on a separable controversy apparent upon the face of the pleadings.

The Warehouse Company and Jones filed separate answers, admitting the bailment, demand and refusal of delivery, but alleged that on or about the 20th day of September, 1947, a fire of unknown origin destroyed the warehouse in which the broomcorn was stored; that the broomcorn was totally destroyed without the fault or negligence of the defendants, and prayed that it be excused from redelivery.

At the pre-trial conference, it was agreed that the warehouse and broomcorn were completely destroyed by fire of an unknown origin. Based upon these facts and supporting affidavits, the Warehouse Company moved for summary judgment on the grounds that the fact of destruction by fire of an unknown origin absolved it of any liability as bailee, unless the bailors could affirmatively show that the fire was caused by the bailee's failure to exercise due care. The motion for summary judgment was denied, and at the inception of the trial, the court instructed the jury that the first question for their consideration was whether the Warehouse Company used due care — "such care as would be exercised by a person of ordinary prudence about his own affairs, in taking care of the broomcorn stored with them" and that "the burden * * * is upon the defendant to show that it did use such care." The Warehouse and Jones then proceeded to offer testimony tending to negative any lack of due care in the maintenance of the warehouse, after which the appellees offered rebuttal evidence to the effect that there was no night watchman at the place; that debris was permitted to collect in and around the building, especially under the floor or platform where the broomcorn was stored; and that parties were permitted to smoke inside the building where the broomcorn was stored.

At the conclusion of the evidence, the cause was submitted to the jury on special interrogatories, in answer to which they found that the appellant failed to use ordinary care as bailee for the stored broomcorn, and that it was negligent, first, in failing to have a night watchman at the time of the fire, two, permitting inflammable trash to collect in the warehouse; and three, permitting smoking in the room where the broomcorn was stored; and that such acts were the proximate cause of the fire. Based upon these findings, the trial court entered judgment against the bailee for the value of the broomcorn.

On appeal, the bailee renews its exceptions to the instructions of the court placing the ultimate burden upon it of proving its freedom from negligence. It concedes that proof of bailment and refusal of delivery on demand creates a legal presumption of negligence, which, in the absence of countervailing evidence, entitles the bailor to a judgment as a matter of law. It is insisted, however, that the presumption being a legal one, born of necessity, completely disappears when the bailee comes forward with some explanatory evidence consistent with due care (in this case destruction by fire of an unknown origin), and it then becomes incumbent upon the bailor to prove lack of it by a preponderance of the evidence.

As Chief Judge Learned Hand puts it: "The presumption on which the bailor may rely is a mere rule for the conduct of the trial. It puts upon the bailee the risk of a directed verdict if he does not meet it, but it does no more; once he has done so, it disappears from the case. Thus, it can never concern the jury". Alpine Forwarding Co. v. Pennsylvania R. Co., 2 Cir., 60 F.2d 734, 736. Although there is some confusion and variation along the way, 6 Amer. Juris., Sec. 364, it is undoubtedly the great weight of decisional law that the so-called bailment presumption does not shift the burden of proving lack of due care from the bailor to the bailee, but merely calls upon the bailee to come forward with evidence sufficient to overcome the legal presumption. See Annotations 9 A.L.R. 59; 71 A.L.R. 767; 151 A.L.R. 717; 6 Amer. Juris. Secs. 364-381; 8 C. J. S., Bailments, § 50, page 344.

Tempting as it is, we regard a discussion of the nice distinctions which have been drawn in the application of the rule, based upon pleadings, forms of actions and other considerations, as academic, since this cause of action arose in New Mexico, and this suit was brought under the Uniform Warehouse Receipts Act of that State. See New Mexico Annot. Stat. 1941, Section 53-801 et seq. Section 53-808 provides in presently material part that if a warehouseman, subject to the act, fails or refuses to make delivery upon demand, the burden shall be upon him to establish the existence of a lawful excuse for such refusal; and Section 53-821 provides in material part that a warehouseman shall be liable for any loss to goods caused by his failure to exercise reasonable care in regard to the goods, but in the absence of an agreement to the contrary, he shall not be liable for loss or injury which could not have been avoided by the exercise of such care.

The State of New Mexico has not had occasion to construe this Act, but a number of other states have had occasion to construe it in the light of the pre-existing or prevailing common-law rule. With only slight deviation, the courts have held that the plain...