Kansas City Southern Railway Company v. Carl

Citation33 S.Ct. 391,57 L.Ed. 683,227 U.S. 639
Decision Date05 March 1912
Docket NumberNo. 16,16
CourtUnited States Supreme Court

Action by the holder of a bill of lading issued by the Chicago, Rock Island, & Pacific Railway for two boxes and one barrel containing 'household goods,' received at Lawton, in what was then the Indian territory, a station on the line of the railway company, for transportation to Gentry, Arkansas, a station on the line of railway of plaintiff in error. One of the boxes was never delivered, and the shipper sued to recover its value.

The defense was that the plaintiff had, in order to obtain the lower of two freight rates, shipped the boxes under an agreement that the goods, in case of a loss, should be valued at $5 per hundredweight, and that it, as a succeeding carrier in the route, was entitled to the benefit of that limitation of value. The total weight of the two boxes and barrel was 400 pounds, and the weight of the box lost was not over 200 pounds. The limitation of liability was in the form of a release signed by the shipper, and was delivered to the primary carrier on receipt of the bill of lading.

The relevant parts of the bill of lading were in these words:

Lawton, 10-8-1907.

Received from J. M. Carl, in apparent good order, by the Chicago, Rock Island, & Pacific Railway Company the following described packages marked and numbered as per margin, subject to the conditions and regulations of the published tariff of said company, to be transported over the line of this railroad to _____ and delivered, after payment of freight, in like good order to the next carrier (if the same are to be forwarded beyond the line of this company's road), to be carried to the place of destination; it being especially agreed that the responsibility of this company shall cease at this company's depot at which the same are to be delivered to such carrier; but this company guarantees that the rates of freight for the transportation of said packages from the place of shipment to _____ shall not exceed ___ per ___ and charges advanced by this company, subject to the following conditions:

* * * * *

It is further especially agreed that for all loss or damage occurring in the transit of said packages the legal remedy shall be against the particular carrier or forwarder only in whose custody may be actually at the happening thereof, it being understood that the Chicago, Rock Island, & Pacific Railway Company assumes no other responsibility for their safe carriage or safety than may be incurred on its own road.

* * * * *

Consignee: Destination:

J.M. Carl. Gentry, Ark.

Description of Articles.

No. Weights. Stamp.

Subject to correction

2 Bx. H.H. goods. Paid to apply

1 Brl. H.H. goods. 400 $3.85

O.R. Val. 5.00 cwt. 127016

R. F. Prettyman, Agent.

The legend 'O. R. Val. 5.00 cwt.' on the bill of lading is an abbreviation for 'Owner's released valuation $5 per hundred-weight,' and was intended to connect with the contract of release, which was in these words:

Lawton Station, 10, 8, 1907.

In consideration of the price (special rates on carloads and first-class rates on less quantities) at which the Chicago, Rock Island, & Pacific Railway Company hereby agrees to transport a quantity of household goods, furniture, or emigrants' movables—including live stock, if any in the car from Lawton, O. T. station to Gentry, Arkansas, station, the same being consigned to J. M. Carl. I, _____ _____, the consignor, hereby release the said company, and all other railroad and transportation companies over whose lines the above property may pass to destination, from all liability from any loss or damage said property may sustain in excess of $5 per 100 lbs., and I hereby guarantee all charges for freight on connection lines to destination.

J. M. Carl, Consignor.

N. B.—When household goods, etc., are shipped at rate based on valuation of $5 per hundred pounds, agents will require the owner or consignor to sign this agreement, and when signed, same must be kept on file at forwarding station. Agent must then note on Way Bill, 'Released to valuation of $5 per hundred pounds.'

The suit was started before a state justice of the peace, and the pleadings were informal. There was a judgment for $75, which was the uncontradicted full value of the goods lost. The case was taken to the circuit court for Benton county, where there was a verdict and a judgment for the same amount. This judgment was, upon a writ of error, affirmed in the supreme court of the state, the case being reported in 91 Ark. 97, 134 Am. St. Rep. 56, 121 S. W. 932.

The uncontradicted evidence was that two boxes and a barrel containing household goods were delivered to the initial carrier, and that the plaintiff in error received same, but delivered only one of the boxes and the barrel, and that the value of the box lost was $75; that there were two rates in effect upon household goods shipped from Lawton to Gentry, one based upon a released valuation of $5 per hundredweight, and a higher rate upon such articles not so released, and that the latter rate was 78 cents per hundred pounds higher than the released valuation rate, and that these two rates 'were evidenced by tariffs duly filed with the Interstate Commerce Commission and published according to law.'

The defendant in error testified, over objection, that though he could read and write, and had signed the release set out above, and had received the bill of lading, he had neither read them nor asked any questions about them, and had not been given any information as to the contents of either document, and had no knowledge of the existence of the two rates. He was also allowed to testify that if he had known of the difference between the two rates, and the effect of accepting the lower, he would have paid the higher rate. There was no evidence tending to show any misrepresentation made by the company, or of any deceit, or fraud, or concealment, unless it be inferred from the fact that the company made no explanation of the rates or the contents of either the bill of lading or the release. The shipper merely said that the bill of lading was handed to him with the release, which he was asked to sign. Exceptions were taken to the rulings upon evidence and to certain parts of the charge, and for the refusal of the court to grant certain requests.

Messrs. A. B. BROWNE, SAMUEL W. Moore, and James B. McDonough, for plaintiff in error.

[Argument of Counsel from pages 643-646 intentionally omitted] No appearance for defendant in error.

Statement by Mr. Justice Lurton:

Mr. Justice Lurton, after making the foregoing statement, delivered the opinion of the court:

The supreme court of the state declined to consider or pass upon any of the questions made in that court for reversal except the single question as to whether the plaintiff in error, as the final carrier in the route, was entitled to the benefit of the stipulation in the release signed by the shipper, releasing the Chicago, Rock Island & Pacific Railway, the primary carrier, 'and all other railroad and transportation companies over whose lines the above property may pass to destination, from any loss or damage the property may sustain in excess of $5 per hundredweight.'

The court, after saying that the plaintiff in error 'relies for a reversal on the clause in the contract with the initial carrier limiting the liability as to value in case of loss . . . as a stipulation for its benefit as well as for the benefit of the initial carrier, and bases this contention on our decisions to that effect,' in answer to this contention, said:

'But in making their contention they have not taken into consideration the effect of the Hepburn amendment [34 Stat. at L. 584, chap. 3591, U. S. Comp. Stat. Supp. 1911, p. 1288] to the interstate commerce act [24 Stat. at L. 379, chap. 104, U. S. Comp. Stat. Supp. 1911, p. 1284], which became effective on June 29th, 1906, a date prior to the time the contract in question was made.'

The provisions of the 20th section of that act were then set out, and the court proceeded by saying:

'The undisputed evidence shows that the initial carrier received the property for transportation from a point in one state to a point in another state, and the presumption, in the absence of evidence to the contrary, was, as will be seen from our decisions hereinafter referred to, that the goods were lost through the negligence of appellant, the last carrier.

'The section of the Hepburn act above quoted makes the carrier liable 'for any loss, damage, or injury to such property caused by it, . . . and no contract, receipt, rule, or regulation shall exempt such common carrier, railroad, or transportation company from the liability hereby imposed.'

'The express terms of the act make the carrier liable for any loss caused by it, and provide that no contract shall exempt it from the liability imposed. It is manifest that the act renders invalid all stipulations designed to limit liability for losses caused by the carrier. Public policy forbids that a public carrier should by contract exempt itself from the consequences of its own negligence. For the same reason a statute may prohibit it from making stipulations in a contract which provide for such partial exemption.

'If the initial carrier is prohibited from making a contract limiting its own liability, it is obvious that it should not make a contract limiting the liability of its connecting carriers; for the section of the Hepburn act under discussion provides that the carrier issuing the bill of lading may recover from the connecting carrier on whose line the loss occurs the amount of the loss it may be required to pay the owner.'

As the shipment was interstate, the contract was controlled by the 20th section of the act of Congress of June 29, 1906. The initial carrier, under...

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