Flying Tiger Line v. Pinto Trucking Service

• Decision Date: 06 July 1981
• Docket Number: Civ. A. No. 80-2583.
• Citation: 517 F. Supp. 1108
• Parties: FLYING TIGER LINE, INC. v. PINTO TRUCKING SERVICE, INC.
• Court: U.S. District Court — Eastern District of Pennsylvania

517 F. Supp. 1108

FLYING TIGER LINE, INC. v. PINTO TRUCKING SERVICE, INC.

Civ. A. No. 80-2583.

United States District Court, E. D. Pennsylvania.

July 6, 1981.

James W. Patterson, Harper, George, Buchanan & Driver, Philadelphia, Pa., Peter R. Reilly, Thompson, Hine & Flory, Washington, D. C., for plaintiff.

Miles A. Jellinek, Cozen, Begier & O'Connor, Philadelphia, Pa., for defendant.

SUR PLEADINGS AND PROOF

LUONGO, District Judge.

Plaintiff, Flying Tiger Line, Inc. (FTL) brought this action to recover $37,722.12 pursuant to the Carmack Amendment. 49 U.S.C. § 11707. This sum represents the amount FTL was required to pay for the repair of a jet engine damaged in transit by defendant Pinto Trucking Service, Inc. (Pinto). Pinto concedes responsibility for the damage to the engine, but contends that it effectively limited its liability to the sum of $2,079.50, the released rate value of the engine. 49 U.S.C. § 10730.

In lieu of a trial the parties have submitted the case to me on stipulated facts.^* In resolving this case I have considered the stipulated facts, the pleadings, written submissions and oral presentations of the parties.

I. JOINT STIPULATION OF FACTS

1. This Court has jurisdiction over this action pursuant to 28 U.S.C. § 1337, since it arises under an Act of Congress regulating commerce, i. e., Section 11707 of the Revised Interstate Commerce Act, 49 U.S.C. § 11707 formerly Section 20(11) of the Interstate Commerce Act, 49 U.S.C. § 20(11) and the amount in controversy exceeds $10,000, exclusive of interest and costs.

2. Plaintiff, Flying Tiger Line, Inc., is a Delaware Corporation with its principal place of business at 7401 World Way West, P.O. Box 92935, Los Angeles, California 90009. FTL is a common carrier operating in interstate commerce.

3. Defendant, Pinto Trucking Service, Inc., is a Pennsylvania corporation with its principal place of business at 1414 Calcon Hook Road, Sharon Hill, Pennsylvania 19079. Pinto is a common carrier operating in interstate commerce.

4. On or about February 16, 1979, FTL tendered three new jet aircraft engines to Pinto at Bradley International Airport, Windsor Locks, Connecticut, for common carrier motor transportation and delivery to FTL at JFK International Airport, Jamaica, New York. (Attachment to Joint Stipulation 1)

5. The face of the bill of lading for this transportation issued to FTL by Pinto, Pinto Airbill Number 26-12885 dated February 16, 1979, contains printing acknowledging receipt of "the property described below, in apparent good order, except as noted ..." and no such exceptions are noted thereon. (Attachment to Joint Stipulation 1)

6. The applicable FTL Trucking Manifest contains a similar pre-printed statement: "Rec'd above shipments in good order except as noted in the exceptions column." This statement was signed by Pinto's driver and again no exceptions were noted. (Attachment to Joint Stipulation 2)

7. The face of the bill of lading also contains the typed notation "EXCLU. USE TRK. O/W, BDL/JFK" in its printed Special Services Requested box. (Attachment to Joint Stipulation 1)

8. The face of the bill of lading contains red printing which states:

"Unless a Greater Value is Declared Herein, the Shipper Agrees and Declares that the Value of the Property is Released to an Amount Not Exceeding $50 for Any Shipment of 100 Pounds or Less and Not Exceeding 50 Cents Per Pound for Shipments Weighing in Excess of 100 Pounds."

(Attachment to Joint Stipulation 1)

9. FTL declared no "Greater Value."

10. The face of the bill of lading also contains printing which states that the shipment is "RECEIVED, subject to the classifications and tariffs in effect on the date of the issue of this Bill of Lading." (Attachment to Joint Stipulation 1)

11. After the engines had been loaded on the Pinto truck and the truck had moved only a short distance from the FTL loading dock, one of the three jet engines fell from it sustaining damage.

12. The engine was repaired by the manufacturer, the Pratt & Whitney Aircraft Group.

13. On February 25, 1980, FTL, which had common carrier responsibility for the engine to the owner of the engine, the Boeing Company ("Boeing"), paid Boeing $37,722.12 in repair damage costs. (Attachment to Joint Stipulation 3)

14. On August 22, 1979, FTL filed written notice of claim for damages with Pinto. (Attachment to Joint Stipulation 4) 15. On January 21, 1980, Pinto forwarded two checks in response to FTL's claim in the total amount of $2,079.50, representing 50 cents per pound times the weight of the damaged engine, 4,159 pounds. (Attachment to Joint Stipulation 5) FTL has not negotiated these checks.

16. Pinto has conceded responsibility for the damages which occurred to the engine but, relying on the released rate provisions of its tariff and the above-mentioned bill of lading, has refused to pay any additional money in satisfaction of FTL's claim. (Attachment to Joint Stipulation 5)

17. The released rate provision of the Pinto tariff in effect at the time of the accident, Pinto Freight Tariff MF-ICC 46, as amended (Attachment to Joint Stipulation 6) was authorized by the Interstate Commerce Commission (ICC) in Released Rates Order No. MC-638 of October 12, 1965. (Attachment to Joint Stipulation 7) The Order was issued in response to a released rate application filed by the National Motor Freight Traffic Association, Inc. (Attachment to Joint Stipulation 8)

18. Pinto Freight Tariff MF-ICC 46 contains, in item 160, a released rate provision authorized by Released Rate Order No. MC-638. (Attachment to Joint Stipulation 6)

19. Pinto Local and Joint Motor Freight Tariff, MF-ICC 74, as amended, was also in effect at the time of the accident. (Attachment to Joint Stipulation 9)

20. Both Pinto Tariffs contain exclusive use provisions, MF-ICC 46 at Item 70 and MF-ICC 74 at Item 55.

21. Pinto holds motor carrier authority from the ICC which is not restricted to the transportation of shipments having a prior or subsequent movement by air.

22. The deregulation of air cargo was effective on November 9, 1977. 49 U.S.C. § 1388.

DISCUSSION

Since Pinto has conceded responsibility for the damage to the jet engine (Joint Stipulation of Fact 16), the sole issue to be resolved is whether Pinto effectively limited its liability to the jet engine's released rate value¹ pursuant to 49 U.S.C. § 10730. FTL contends that Pinto's authority to limit its liability did not apply to the "exclusive use of vehicle rate" Pinto charged in the instant case.

Pursuant to 49 U.S.C. § 11707, which recodified the Carmack Amendment (formerly 49 U.S.C. § 20(11)) without substantive change, a carrier is liable for the actual loss or injury to property caused by it, see Missouri Pacific Railroad Company v. Elmore & Stahl, 377 U.S. 134, 137, 84 S.Ct. 1142, 1144, 12 L.Ed.2d 194 (1964); Howe v. Allied Van Lines, Inc., 622 F.2d 1147, 1157 (3d Cir. 1980), but § 11707(c)(4) provides that "a common carrier may limit its liability for loss or injury of property" pursuant to 49 U.S.C. § 10730.

At the time the incident giving rise to this action occurred 49 U.S.C. § 10730 (West Pamphlet 1980)² provided,

The Interstate Commerce Commission may require or authorize a carrier providing transportation or service subject to its jurisdiction under subchapter I, II, or IV of chapter 105 of this title, to establish rates for transportation of property under which the liability of the carrier for that property is limited to a value established by written declaration of the shipper, or by a written agreement, when that value would be reasonable under the circumstances surrounding the transportation. A rate may be made applicable under this section to livestock only if the livestock is valuable chiefly for breeding, racing, show purposes, or other special uses. A tariff filed with the Commission under subchapter IV of this chapter shall refer specifically to the action of the Commission under this section.

Id.

Under this section "carriers may limit their liability to the declared or released value of the shipment only if they charge lower rates specifically approved by the" Interstate Commerce Commission (ICC), National Bus Traffic Association, Inc. v. ICC, 613 F.2d 881, 882, n.5 (D.C.Cir.1979), and obtain the shipper's agreement in writing to the declared or released value. Anton v. Greyhound Van Lines, Inc., 591 F.2d 103, 107 (1st Cir. 1978). See generally, Howe v. Allied Van Lines, Inc., 622 F.2d 1147, 1158-1159 (3d Cir. 1980). The shipper must be given the choice to increase its liability protection by paying a higher rate for the transportation. Anton v. Greyhound Lines, Inc., supra, 591 F.2d 108.

Because the public policy as contained in the Carmack Amendment is to hold carriers (in this case Pinto) liable for the actual injury to goods shipped, arrangements attempting to limit liability will be strictly construed against the carrier. See, e. g., Anton v. Greyhound Van Lines, Inc., supra, 591 F.2d at 109; Chandler v. Aero Mayflower Transit Company, 374 F.2d 129, 135 (4th Cir. 1967). Accordingly, the carrier has the burden of establishing that its liability is limited. Thomas Electronics Incorporated v. H. W. Taynton Company, 277 F.Supp. 639, 643 (M.D.Pa.1967).

Pinto contends that the ICC authorized it to provide for released rates for transportation such as that rendered in the instant case, that its tariff on file with the ICC revealed that the released rates would apply, and that, by accepting the bill of lading without declaring a greater value for the engine, FTL agreed to the released rate liability. FTL contends that Pinto was authorized to limit its liability solely in conjunction with commodity rates and that therefore the released rate provision in Pinto's tariff does not apply to the "exclusive use of vehicle rate" charged in the instant case. (Joint Stipulation of Fact 7).

Although FTL is correct in claiming that the ICC authorized Pinto to limit...