Northwestern Auto Parts Co. v. Chicago, B. & QR Co.

• Decision Date: 12 April 1956
• Docket Number: Civ. No. 5027-5030.
• Citation: 139 F. Supp. 521
• Parties: NORTHWESTERN AUTO PARTS CO., a corporation, Plaintiff, v. CHICAGO, BURLINGTON & QUINCY RAILROAD CO., a corporation, Defendant. NORTHWESTERN AUTO PARTS CO., a corporation, Plaintiff, v. CHICAGO, MILWAUKEE, ST. PAUL & PACIFIC RAILROAD CO., a corporation, Defendant. NORTHWESTERN AUTO PARTS CO., a corporation, Plaintiff, v. GREAT NORTHERN RAILWAY CO., a corporation, Defendant. NORTHWESTERN AUTO PARTS CO., a corporation, Plaintiff, v. The MINNEAPOLIS & ST. LOUIS RAILWAY CO., a corporation, Defendant.
• Court: U.S. District Court — District of Minnesota

139 F. Supp. 521

NORTHWESTERN AUTO PARTS CO., a corporation, Plaintiff, v. CHICAGO, BURLINGTON & QUINCY RAILROAD CO., a corporation, Defendant.

NORTHWESTERN AUTO PARTS CO., a corporation, Plaintiff, v. CHICAGO, MILWAUKEE, ST. PAUL & PACIFIC RAILROAD CO., a corporation, Defendant.

NORTHWESTERN AUTO PARTS CO., a corporation, Plaintiff, v. GREAT NORTHERN RAILWAY CO., a corporation, Defendant.

NORTHWESTERN AUTO PARTS CO., a corporation, Plaintiff, v. The MINNEAPOLIS & ST. LOUIS RAILWAY CO., a corporation, Defendant.

Civ. Nos. 5027-5030.

United States District Court D. Minnesota, Fourth Division.

April 12, 1956.

Sidney S. Feinberg, Robins, Davis & Lyons, Minneapolis, Minn., for plaintiff.

Harry S. Stearns, Jr., St. Paul, Minn., for defendant Chicago, B. & Q. R. Co.

R. W. Cronon, Edwin C. Matthias and Anthony Kane, St. Paul, Minn., for defendant Great Northern R. Co.

L. C. Corcoran, Minneapolis, Minn., for defendant M. & St. L. R. Co.

G. F. Bennett, Minneapolis, Minn., for defendant Chicago, M., St. P. & P. R. Co.

DEVITT, District Judge.

This is an action brought by a shipper against four railroads to recover alleged excessive freight rates paid. The facts have been stipulated. Defendants move for summary judgment.

Plaintiff is engaged in the business of acquiring, reconditioning, rebuilding and marketing used automotive parts. From October, 1953 to April 1954, plaintiff consigned and shipped to itself in Minneapolis, Minnesota, 28 carloads of obsolete vehicle parts which plaintiff had purchased from the United States Army as surplus. Plaintiff had obtained the material by bidding in competition with regular scrap iron and steel dealers. The shipments were delivered to plaintiff in Minneapolis by the four defendant railroads at various times between the dates mentioned.

The defendant railroads assessed and received from plaintiff freight charges applicable to the freight tariff rating for "auto parts and engine parts other than auto bodies, having value for reconditioning."¹ Plaintiff contends that this freight rate is inapplicable to the material shipped and that the proper one is that lower rate which is applicable to "scrap iron or steel having value for remelting purposes only."² Plaintiff seeks to recover $22,913.53, representing the difference between the freight rate actually paid by it and the lower rate for scrap iron or steel.

This court has original jurisdiction of this kind of proceeding. 28 U.S. C.A. § 1337; 49 U.S.C.A. § 9; Atchison, T. & S. F. Ry. Co. v. United States ex rel. Sonken-Galamba Corp., 8 Cir., 1938, 98 F.2d 457.

There is no question presented here, nor can there be, as to the reasonableness of the rates charged. That is not within our province. 49 U.S.C.A. § 15(1); Terminal R. Ass'n of St. Louis v. United States, 1924, 266 U.S. 17, 45 S.Ct. 5, 69 L.Ed. 150. The sole issue is as to the nature of the material shipped for rate purposes. This is the only issue the court is empowered to decide. See Sonken-Galamba Corp. v. Union Pac. R. Co., 10 Cir., 1944, 145 F.2d 808.

The principle governing this kind of case is adequately stated in Sonken-Galamba Corp. v. Union Pac. R. Co., supra, 145 F.2d at page 812:

"* * * It is * * * plain that the nature and character of each shipment at the time tendered for shipment determines its status for rate purposes, and the use which may be subsequently made of the material does not control the question whether the shipment has a recognized commercial value."

See also Crancer v. Lowden, 8 Cir., 1941, 121 F.2d 645, 649, affirmed on other grounds, 1952, 315 U.S. 631, 62 S.Ct. 763, 86 L.Ed. 1077; Larrimore Inc. v. Union Pac. R. Co., 273 I.C.C. 415; Lapides Metals Co. v. B. & M. R. R. Co., 278 I.C.C. 214.

This principle seems particularly appropriate in this case. It appears from the stipulation of facts that the plaintiff's experience in the past has been that approximately 10% of the automotive parts shipped is reconditioned and that eventually 90% is sold for scrap. Plaintiff has no records with which to corroborate these percentages. It also appears from the stipulation of facts that the ultimate use by the plaintiff of the vehicle parts, whether for reconditioning or scrap, depends not entirely upon the physical condition of the parts, but also upon such unpredictable factors as the condition of the markets for scrap and automotive parts, the demand for particular parts, the cost of reconditioning, storage space, stock on hand of particular parts, and the sufficiency of reserve capital. None of these factors, save the physical condition of the parts, can be determined at the time of shipment, and it is self evident that classification of materials for rate purposes cannot depend upon events which occur after shipment and which may occur in varying degrees. Hence, the inquiry must be directed to the nature and condition of the automotive parts purchased by plaintiff from the United States Army at the time these parts were tendered for shipment. Sonken-Galamba Corp. v. Union Pac. R. Co., supra; Atchison Leather Products Company v. A., T. & S. F. R. Co., 274 I.C.C. 328; Reliable Jobbers & Shoe Co., Inc. v. A., T. & S. F. R. Co, 284 I.C.C. 72.

The rate-making and regulatory body has by apt and revealing words defined "scrap iron" as used in its prescribed tariff as that class of metal which has value for remelting purposes only,³ and it has amplified that definition by describing "scrap iron" as consisting of "old, worn out, obsolete, broken and cut iron, or dismantled machinery, and parts thereof, entirely unfit for original use and having no commercial value except for remelting purposes." Klotz Bros. v. Chesapeake & Ohio, 177 I.C.C. 557. See also United States ex rel. Sonken-Galamba Corp. v. Missouri-Kansas-Texas R. Co., D.C., 21 F.Supp. 931, affirmed Atchison, T. & S. F. R. Co. v. United States ex rel. Sonken-Galamba Corp., 8 Cir., 1938, 98 F.2d 457; Vol. 38, Words and Phrases, Scrap Iron and Scrap Steel, p. 364.

The Interstate Commerce Commission stated in H. P. Randall Mfg. Co. v. Alton & S. R., 269 I.C.C. 655, 657:

"The Commission has found in numerous proceedings that where a commodity has a utility in its original form it cannot be considered scrap."

The parties have stipulated that "substantial amounts of parts have the physical...