Hines v. Scott

• Decision Date: 28 February 1923
• Docket Number: (No. 394-3628.)
• Citation: 248 S.W. 663
• Parties: HINES, Director General of Railroads, v. SCOTT.
• Court: Texas Supreme Court

Page 663

248 S.W. 663

HINES, Director General of Railroads, v. SCOTT.

(No. 394-3628.)

Commission of Appeals of Texas, Section "A."

February 28, 1923.

Certified Questions from Court of Civil Appeals of Third Supreme Judicial District.

Action by Sam R. Scott against Walker D. Hines, Director General of Railroads, as agent. Judgment for plaintiff was reversed and rendered by the Court of Civil Appeals, and judgment rendered for defendant. Cause certified to the Supreme Court on motion for rehearing. Questions answered.

Terry, Cavin & Mills, of Galveston, and Sanford & Harris, of Waco, for appellant.

Alva Bryan and Witt, Terrell & Witt, all of Waco, for appellee.

GERMAN, J.

Appellee, Sam R. Scott, filed this suit in the county court of McLennan county, Tex., against Walker D. Hines, Director General of Railroads, Agent, for damages for wrongful delivery of a carload of apples shipped by him from Roswell, N. M., to Waco, Tex., about August 22, 1919. Judgment was rendered in his favor for $185, with 6 per cent. interest from August 27, 1919, making a total judgment of $191.78. Appeal was taken to the Court of Civil Appeals for the Third Supreme Judicial District, and that court reversed and rendered the judgment in favor of appellant Walker D. Hines, Agent; but dissenting opinion was filed by Associate Justice Jenkins. On motion for rehearing, the cause was certified to the Supreme Court upon the questions hereinafter set out.

The findings of fact made by the trial court and the Court of Civil Appeals show that in August, 1919, the appellee contracted with Turner-Coffield Company of Waco, Tex., to sell them a carload of merchantable apples f. o. b. Roswell, N. M., at $2 per box. No shipping instructions were given, but seller was directed by purchaser to indorse the bill of lading, draw a draft for the amount of purchase, attach same to the bill of lading, and send same to some bank in Waco. The sale of the apples was made by Walter Reese of Waco, Tex., acting for the seller, and the sale was made by sample. August 22, 1919 the carload of apples was delivered by appellee to Walker D. Hines, Agent, at Roswell, N. M., the car containing 628 boxes of apples. A regular order form bill of lading was issued and delivered to appellee, showing that the shipment was consigned to the order of Sam R. Scott, Waco, Tex., notify Turner-Coffield Company at Waco. The bill of lading contained the following provision:

"The surrender of this bill of lading properly indorsed shall be required before the delivery of the property. Inspection of property covered by this bill of lading will not be permitted unless provided by law or unless permission is indorsed on this original bill of lading or given in writing by the shipper."

The bill of lading was indorsed by appellee, who drew a draft for the sum of $1,256 on Turner-Coffield Company, which was attached to the bill of lading, and the same was sent in due course of business to the First State Bank & Trust Company of Waco, Tex., and the bank was advised to notify Turner-Coffield Company.

About August 27, 1919, the carload of apples arrived at Waco and was by the railway company placed on a private siding, which was used by Turner-Coffield Company for loading and unloading shipments. On the morning of August 28th, Turner-Coffield Company, having been advised of the arrival of the car, broke the seals and opened the car, removing several boxes of the apples, which were examined and inspected by them, and the boxes were replaced in the car, the door closed, and the shipment was refused by them. At the time of breaking the seals and inspecting the apples, Turner-Coffield Company had not paid the draft, and had not obtained the bill of lading, and did not present same to the appellant.

At the time of the transaction referred to, and for many years prior thereto, Turner-Coffield Company was and had been engaged in the wholesale business, receiving and sending out shipments of merchandise in carload lots. For a long time it had been their uniform custom on the arrival of merchandise in carload lots to open the cars and inspect the contents before presenting bill of lading, and before paying draft; and, if same was found satisfactory, to then pay the draft, obtain bill of lading, and deliver same to the carrier; and if the contents were not satisfactory, they would decline the shipment, refuse to pay the draft, and turn the shipment back into the hands of the shipper or the transportation company. This custom and practice of the Turner-Coffield Company was known to appellant, its agents, and representatives, at the time, and had been acquiesced in for some time prior to this particular transaction. However, the appellant and its agents and servants had no knowledge of the action of the Turner-Coffield Company in entering the car and inspecting the contents in this particular instance until after same had been accomplished. The original bill of lading was not presented to the appellant, and there was no indorsement on the bill of lading nor written permission given Turner-Coffield Company or any one else to enter the car and inspect the apples before producing the bill of lading. At the time of the transaction the bill of lading was in the possession of the First State Bank & Trust Company of Waco, where it could have been obtained by paying the draft attached. The Turner-Coffield Company, in opening said car and inspecting the contents, acted in accordance with the custom previously adopted, which custom was known to and acquiesced in by appellant.

The reasonable market value of the carload of apples at Roswell, N. M., on August 27, 1919, was $1,256, and the reasonable market value of same at Waco at that date was $1,256, plus the cost of transportation.

After the refusal of the shipment by Turner-Coffield Company, upon order from the appellee, the appellant delivered the car of apples to Walter Reese, who handled and disposed of them at the request of the appellee; such instructions being given by appellee without prejudice to any cause of action he may have had against the appellant for wrongful delivery, or conversion, of the shipment. Reese realized from the sale of the apples the sum of $1,167.25, and paid therefrom the following items of expense: Freight, $185; storage, $52; demurrage, $8.24; commission on sales, $92; and the sum of $830.01 was paid to appellee. Reese could have sold the apples in the car at the time at $2 per box, but he put them in storage and sold them out in lots.

The damages claimed by appellee in his petition was the difference between $1,256, the value of the apples at Roswell, N. M., and the sum of $830.01 which he actually received. The trial court, it seems, allowed him judgment only for the item of $185 paid as freight, with 6 per cent. interest on same to the date of judgment.

The questions certified by the Honorable Court of Civil Appeals are as follows: (1) Was the conduct of the carrier, in permitting inspection by the buyer at the destination, either wrongful or unauthorized? (2) Did the bill of lading, by its terms, authorize the carrier to permit inspection? (3) If the inspection was unauthorized, did the facts pleaded and proved by appellee show damages which were the proximate result of the acts of the carrier, and recoverable by appellee? (4) Was such a breach of contract shown in permitting the inspection as would authorize the recovery of at least nominal damages?

We will consider questions 1 and 2 together, as they are in effect the same. A bill of lading does not stand for or represent the contract between the buyer and the seller, but is a receipt given by the carrier for the goods, coupled with an agreement for their carriage according to the terms expressed in the bill. As between the purchaser and the seller, the right of inspection is ordinarily dependent upon or governed by the terms of their contract, and not by the provisions of the bill of lading, unless the bill has special provisions relating thereto. The Court of Civil Appeals finds that "it is undisputed that the sale in this case was by sample, the agent negotiating the sale having exhibited apples as a sample and as the basis for the sale." It is well settled that in contracts of sale of this kind the purchaser has the right of inspection of the goods before consummating the contract, and this right is not abridged by the seller shipping the goods in his own name, with draft attached to the bill of lading. Pontiac Shoe Mfg. Co. v. Hamilton, 18 Tex. Civ. App. 283, 44 S. W. 405; Keeler v. Paulus Mfg. Co., 43 Tex. Civ. App. 555, 96 S. W. 1097; Mueller v. Simon (Tex. Civ. App.) 183 S. W. 63; McLane v. Swernemann & Schkade (Tex. Civ. App.) 189 S. W. 282; Pope v. Allis, 115 U. S. 363, 6 Sup. Ct. 69, 29 L. Ed. 393, and note. In such cases, if the seller refuses to give the buyer a reasonable opportunity for inspection, or the carrier refuses such opportunity, the purchaser has a right to reject the shipment. Fore v. Plant Seed Co. (Mo. App.) 232 S. W. 169, and cases there cited.

But it is urged that the following provision in the bill of lading was a limitation upon the right of the purchaser to inspect the shipment of apples about which the controversy herein arose:

"The surrender of this bill of lading properly indorsed shall be required before the delivery of the property. Inspection of property covered by this bill of lading will not be permitted unless provided by law or unless permission is indorsed on this original bill of lading or given in writing by the shipper."

As above stated, the right of Turner-Coffield Company to inspect the apples was incidental to, and a part of, their contract with the appellee, and it is our opinion that the stipulation above referred to placed no limitation thereon. The provision above quoted is a part of the uniform order bill of lading promulgated by the Interstate Commerce Commission June 22, 1908. It was adopted under an...