North American Van Lines, Inc. v. Pinkerton Sec. Systems, Inc.

• Decision Date: 16 July 1996
• Docket Number: No. 95-3325,95-3325
• Citation: 89 F.3d 452
• Parties: Fed. Carr. Cas. P 84,016 NORTH AMERICAN VAN LINES, INCORPORATED, Plaintiff-Appellant, v. PINKERTON SECURITY SYSTEMS, INCORPORATED, FCLS/GM Investors Group, Incorporated, and G.M. Limited Partnership, Defendants-Appellees.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 452

89 F.3d 452

Fed. Carr. Cas. P 84,016

NORTH AMERICAN VAN LINES, INCORPORATED, Plaintiff-Appellant, v. PINKERTON SECURITY SYSTEMS, INCORPORATED, FCLS/GM Investors Group, Incorporated, and G.M. Limited Partnership Defendants-Appellees.

No. 95-3325.

United States Court of Appeals Seventh Circuit.

Argued Feb. 6, 1996.

Decided July 16, 1996.

Christopher A. Garcia, Sanchez & Daniels, Chicago, IL, Barbara Naretto Petrungaro, Brian W. Bell, Swanson, Martin & Bell, Chicago, IL, Mark T. Mullen (argued), James Cullen, Cozen & O'Connor, Philadelphia, PA, for North American Van Lines, Inc.

Michael W. Rathsack (argued), Chicago, IL, Michael J. Charysh, David H. Schroeder, Charysh & Schroeder, Chicago, IL, for Pinkerton Sec. Systems, Inc.

Kurt C. Meihofer, Laura B. Glaser, Johnson & Bell, Chicago, IL, for FCLS/GM Group, Inc.

Before ESCHBACH, KANNE, and EVANS, Circuit Judges.

KANNE, Circuit Judge.

The Interstate Commerce Act contains several provisions governing a motor carrier's liability to a shipper for the loss of, or damage to, an interstate shipment of goods. These provisions, which are commonly referred to collectively as the Carmack Amendment, have at one time or another since 1906 resided in different sections of Title 49 of the United States Code. At the time of this lawsuit, they were located at 49 U.S.C. §§ 10103, 11707, 10730. ¹ These sections create a nationally uniform rule of carrier liability concerning interstate shipments and preempt all state and common law remedies covering this subject. Adams Express Co. v. Croninger, 226 U.S. 491, 504, 33 S.Ct. 148, 151, 57 L.Ed. 314 (1913); Hughes v. United Van Lines, 829 F.2d 1407, 1415 (7th Cir.1987), cert. denied, 485 U.S. 913, 108 S.Ct. 1068, 99 L.Ed.2d 248 (1988).

This appeal presents for our review the district court's determination that the Carmack Amendment does not preempt the prerequisites to a claim for contribution prescribed by the Illinois Joint Tortfeasor Contribution Act, 740 ILCS 100/2. Because we conclude that the Contribution Act does not apply to the plaintiff's claims for relief, we reverse the judgment of the district court and remand this matter without addressing the preemption issue.

I

There is no real dispute as to what happened. ² Brown and Williamson Tobacco Corporation and North American Van Lines, Inc., entered into a transportation agreement on May 1, 1992, under which North American agreed to accept, transport, and deliver household goods tendered for carriage by Brown and Williamson. Each shipment was to be tendered under the terms and conditions of a bill of lading, but in the event of a conflict between those terms and the terms of the transportation agreement, the agreement would control. The agreement provided that North American would be liable as a common carrier for the loss, damage, theft, or destruction of the goods placed in its charge pursuant to the terms outlined in a schedule of rates issued under the applicable governing tariffs. Pursuant to the applicable tariff, North American limited its liability to Brown and Williamson to $400,000 per shipment.

On April 21, 1993, North American accepted 1,108 cases of Brown and Williamson cigarettes for transportation from Macon, Georgia, to Des Plaines, Illinois. Brown and Williamson tendered the cargo under a bill of lading, which described the shipment as weighing 38,512 pounds and comprising three varieties of cigarette. North American transported the cargo to Chicago, and it left the trailer containing the cargo at a drop lot located at 900 East 103d Street on April 24. Sometime in the wee hours of April 25, an unknown person drove a stolen North American tractor into the drop lot, hitched the trailer containing the cargo to the stolen tractor, and absconded with the cargo of Brown and Williamson cigarettes. The cargo had a wholesale value of $779,309.40, and North American's insurance carrier paid Brown and Williamson $400,000 as full satisfaction of North American's liability under the bill of lading. ³

North American had leased the drop lot from FCLS/GM Investors Group, Inc., and GM Limited Partnership (the "lessors") on December 23, 1992. ⁴ The lessors had previously contracted with Pinkerton Security Systems, Inc., to provide security services for the drop lot as contemplated by the lease agreement. The lease agreement also required the lessors to make certain improvements to the leased premises, including the installation of an electric gate.

North American filed this diversity action under 28 U.S.C. § 1332 in the Northern District of Illinois on July 26, 1994. The complaint alleged two counts of negligence, one each against Pinkerton and the lessors, and one count of breach of contract against the lessors, and it specified damages of $400,000. Pinkerton filed a motion for summary judgment on count one of the complaint on June 13, 1995, and the lessors filed a motion for summary judgment on counts two and three of the complaint on June 20, 1995. North American filed responses to these motions on July 5.

The district court entered summary judgment in favor of all defendants on August 31, 1995. In its memorandum opinion, the district court stated that North American's complaint asserted claims for contribution against the defendants. It held that the Contribution Act barred these claims because North American had settled Brown and Williamson's claim without obtaining a release extinguishing either defendant's liability for the loss of the cigarettes. North American argued that the Carmack Amendment preempted the release requirements of the Contribution Act, but the district court disagreed and held that the Carmack Amendment did not preempt the Contribution Act.

In reviewing a district court's award of summary judgment, we stand in the shoes of the district court and assess the record de novo. Thiele v. Norfolk & Western Ry. Co., 68 F.3d 179, 181 (7th Cir.1995). This plenary review of the evidence requires that we employ the standard prescribed by FED. R. CIV. P. 56(c) and determine whether the "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). In this determination, we are obliged to view the facts and make all inferences favorably to the nonmoving party. Tolentino, 46 F.3d at 649.

A genuine issue of material fact exists if "there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986). If no such issue exists, the sole question is whether the moving party is entitled to judgment as a matter of law. We find that there are no genuine issues of material fact, and the question therefore is whether the defendants are entitled to summary judgment as a matter of law.

II

The Carmack Amendment governs liability of a common carrier to a shipper for loss of, or damage to, an interstate shipment. At all times relevant to this dispute, the pertinent part of the statute provided as follows:

A common carrier providing transportation or service subject to the jurisdiction of the Interstate Commerce Commission ... shall issue a receipt or bill of lading for property it receives for transportation under this subtitle. That carrier ... [is] liable to the person entitled to recover under the receipt or bill of lading. The liability imposed under this paragraph is for the actual loss or injury to the property caused by (1) the receiving carrier, (2) the delivering carrier, or (3) another carrier over whose line or route the property is transported.... Failure to issue a receipt or bill of lading does not affect the liability of a carrier....

49 U.S.C. § 11707(a) (1995). Another provision of the Carmack Amendment details the means by which carriers can negotiate for limits upon their liability under § 11707 by charging lower rates of carriage. 49 U.S.C. § 10730 (1995).

Prior to the enactment of the Carmack Amendment, the liability of carriers for loss of, or damage to, interstate shipments was a matter either of common law, whether state or federal (at least until Erie R.R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938)), or of state positive law. Adams Express Co., 226 U.S. at 504, 33 S.Ct. at 151 (citing cases). The Adams Court described the complexities that bedeviled shippers and carriers under the old regime:

Some states allow[ed] carriers to exempt themselves from all or a part of the common-law liability by rule, regulation, or contract; others did not. The Federal courts sitting in the various states were following the local rule, a carrier being held liable in one court when, under the same state of facts, he would be exempt from liability in another. Hence this branch of interstate commerce was being subjected to such a diversity of legislative and judicial holding that it was practically impossible for a shipper engaged in a business that extended beyond the confines of his own state, or a carrier whose lines were extensive, to know, without considerable investigation and trouble, and even then oftentimes with but little certainty, what would be the carrier's actual responsibility as to goods delivered to it for transportation from one state to another.

226 U.S. at 505, 33 S.Ct. at 151-52. The Court recognized that the Carmack Amendment manifested Congress's intent "to take possession of the subject" and to prescribe uniform rules governing liability of carriers to shippers regarding interstate shipments. Id. at 506, 33 S.Ct. at 152.

The Carmack Amendment thus preempts all state or common law remedies available to a shipper against a carrier for loss or damage to interstate shipments. See U.S. CONST. art. VI, cl. 2; Adams Express Co., 226 U.S. at 505-06, 33 S.Ct. at 152; Hughe...