Phillips v. Seaboard Air Line Ry.

• Decision Date: 27 September 1916
• Docket Number: 109.
• Parties: PHILLIPS ET AL. v. SEABOARD AIR LINE RY.
• Court: North Carolina Supreme Court

89 S.E. 1057

172 N.C. 86

PHILLIPS ET AL. v. SEABOARD AIR LINE RY.

No. 109.

Supreme Court of North Carolina

September 27, 1916

Appeal from Superior Court, Chatham County; Lyon, Judge.

Action by J. E. Phillips and another against the Seaboard Air Line Railway. From judgment of nonsuit, plaintiffs appeal. Reversed and new trial granted.

The burden of showing reasonableness of stipulations in bills of lading limiting liability of the carrier, or in derogation of common law, is on the carrier.

Plaintiffs sued for damage to two carloads of dewberries shipped by them by the defendants and connecting lines of railways from Cameron, N. C., to Buffalo, N. Y., in June, 1912. They alleged that, by reason of negligent delay on the part of defendant and its associate carriers, the berries became moldy, and they could not, on that account, be sold in the Buffalo market for the ruling price at the time of delivery. There was proof of the delay in transportation beyond the usual time and of depreciation of the berries. The bill of lading contained this clause:

"Claims for loss or damage shall be made in writing to the agent at point of delivery promptly after arrival of the property and if delayed for more than ten days after the delivery of the property, or after due time for the delivery thereof no carrier hereunder shall be liable in any event."

One of the cars arrived at Buffalo, N.Y. June 20, 1912, and the other June 24, 1912, where they were delivered to J. H. Gail the consignee; the berries having been shipped by plaintiff on consignment. No claim for damages was filed within ten days after delivery of the goods at Buffalo, but a written claim was filed with the defendant on September 6, 1912. Plaintiffs notified the defendant's agent at Cameron, N C., orally within the ten days after delivery of the berries to the consignee that they would make a claim for damages.

At the close of all the evidence the court, on motion by defendant, entered a judgment of nonsuit, and plaintiffs appealed.

H. A. London & Son, of Pittsboro, for appellants.

Murray Allen, of Raleigh, for appellee.

WALKER, J. (after stating the facts as above).

There was evidence of negligence for the consideration of the jury, and the only question left open is the one as to the validity of the clause in the bill of lading as to filing a claim for damages. The plaintiffs did not comply with this requirement, nor do we think compliance with it was waived by the defendant. The same question practically was presented in Lytle v. Telegraph Co., 165 N.C. 504, 81 S.E. 759, and it was said there:

"A mere casual remark to the agent at Alta Pass that the message had been delayed, and some one would have to pay for it, was in no sense a claim or demand such as is contemplated by the contract. It was not in writing, as required by the stipulation, nor did it give any fair or adequate idea of her claim, being entirely too indefinite. The authorities we have cited, and they seem to be uniform, are clearly opposed to the contention that it is a sufficient compliance with the contract. The cases relied on by plaintiff are not applicable. The facts were not the same as those we have here."

Similar stipulations in bills of lading and other contracts have been upheld provided they were reasonable. Capehart v. Railroad Co., 81 N.C. 438, 31 Am. Rep. 505; Manufacturing Co. v. Railroad Co., 128 N.C. 280, 38 S.E. 894. The burden of showing the reasonableness of stipulations in bills of lading limiting the liability of the carrier (where this can be done), or in derogation of the common law, is upon him. Hinkle v. Railway Co., 126 N.C. 932, 36 S.E. 348, 78 Am. St. Rep. 685. It is true that this was an interstate shipment, and is governed by the federal law, but the highest court in the federal jurisdiction has held that, while limitations of this sort are permitted, they must be reasonable. That court said in Missouri, K. & T. Railway Co. v. Harriman, 227 U.S. 657, 672, 33 S.Ct. 397, 401, 57 L.Ed. 690, in respect to a provision in a bill of lading as to presenting claims: "The liability sought to be enforced is the 'liability' of an interstate carrier for loss or damage under an interstate contract of shipment declared by the Carmack Amendment of the Hepburn Act of June 29, 1906 [chapter 3591, § 7, pars. 11, 12, 34 Stat. 593 (U. S. Comp. St. 1913, § 8592)]. The validity of any stipulation in such a contract which involves the construction of the statute, and the validity of a limitation upon the liability thereby imposed, is a federal question to be determined under the general common law, and, as such, is withdrawn from the field of state law or legislation. * * * The liability imposed by the statute is the liability imposed by the common law upon a common carrier, and may be limited or qualified by special contract with the shipper, provided the limitation or qualification be just and reasonable, and does not exempt from loss or responsibility due to negligence. * * * The policy of statutes of limitation is to encourage promptness in the bringing of actions, that the parties shall not suffer by loss of evidence from death or disappearance of witnesses, destruction of documents, or failure of memory. But there is nothing in the policy or object of such statutes which forbids the parties to an agreement to provide a shorter period, provided the time is not unreasonably short"--citing authorities.

In that case the claim was required to be made within 90 days from the happening of any loss or damage, and was declared to be valid. And it was so held in Express Company v. Caldwell, 21 Wall. 264, 22 L.Ed. 556, where the time limit was the same. In Railway Co. v. Blish Milling Co., 241 U.S. 190, 36 S.Ct. 541, 60 L.Ed. 948, the time fixed for filing claims for damages was four months. The court held in all those cases that the stipulation was a reasonable one, the court saying in the last-cited case:

"The transactions of a railroad company are multitudinous, and are carried on through numerous employés of various grades. Ordinarily the managing officers, and those responsible for the settlement and contest of claims, would be without actual knowledge of the facts of a particular transaction. The purpose of the stipulation is not to escape liability, but to facilitate prompt investigation. And, to this end, it is a precaution of obvious wisdom, and in no respect repugnant to public policy, that the carrier by its contracts should require reasonable notice of all claims against it even with respect to its own operations."

See, also, Grocery Co. v. Railroad Co., 170 N.C. 241, 87 S.E. 57.

But we are not aware of any case decided by the Supreme Court of the United States in which a provision for presenting claims like the one under consideration has been held to be valid, and in the absence of any such declaration by it controlling the matter, we must decide according to our notion as to the law, especially where the point has been well settled by precedents in this court. We simply follow what has before been decided upon the same question. Manufacturing Co. v. Railroad Co., 128 N.C. 280, 38...