E. E. Taenzer & Co. v. Chicago, R. I. & P. Ry. Co.

• Decision Date: 03 October 1911
• Docket Number: 2,101.
• Parties: E. E. TAENZER & CO. v. CHICAGO, R.I. & P. RY. CO.
• Court: U.S. Court of Appeals — Sixth Circuit

191 F. 543

E. E. TAENZER & CO. v. CHICAGO, R.I. & P. RY. CO.

No. 2,101.

United States Court of Appeals, Sixth Circuit.

October 3, 1911

Caruthers Ewing (Robert E. King, on the brief), for plaintiff in error.

E. E Wright and M. L. Bell (E. B. Peirce, on the brief), for defendant in error.

Before SEVERENS and KNAPPEN, Circuit Judges, and EVANS, District judge.

KNAPPEN Circuit Judge.

This suit grows out of a contract made November 22, 1900, between the Choctaw, Oklahoma & Gulf Railroad Company and the Gifford-Frisbie Lumber Company, which latter company owned a large tract of land in Cross county, Ark., about eight miles north of Round Pond, a station on said railroad. By this contract the lumber company agreed to build a railroad from a point near Great Bend, on the St. Francis river, where the lumber company's mill was located, to the railroad company's right of way at Round Pond. The railroad company agreed to give the lumber company a connection with the former's railroad, and to construct at its own cost that portion of the railroad which should be on its own right of way and which it should own. The lumber company further agreed to construct 'at its own cost or expense, and on its own right of way, a switch or side track near the place of intersection of said railroads, for the placing of cars ' The railroad company was to give the lumber company certain assistance in the building of the road by way of selling a portion of the materials at cost and furnishing the rails and fastenings on credit, to be secured by mortgage on the lumber company's road, on which mortgage was to be applied the lumber company's proportion of the through freights, under a division thereof hereafter referred to. The lumber company bound itself to ship over the railroad company's line during a period of ten years all of its lumber and the traffic originating on the lumber company's road, except such as the latter might desire to ship to and from Memphis by way of the St. Francis and Mississippi rivers, with provision, in case of default, for liquidated damages, as well as immediate maturity of the indebtedness for rails and fastenings.

The contract provided a system of rate making and freight division during the 10-year period, the material portions of which are these: That on lumber from the mills to Hopefield and Memphis thethrough rate should be 5 cents per hundredweight; on cotton to Hopefield and Memphis the same rate as from Round Pond, or the connecting point of the two lines; on merchandise to and from Memphis the same rate as between Memphis and equally distant points on the railroad company's line; on grain and grain products from stations on the railroad company's lines to points on the lumber company's lines, the same rates as to Memphis from the same stations on the railroad company's lines. In the matter of divisions the lumber company was to receive on all shipments of lumber for delivery at Hopefield 2 cents per hundredweight; on lumber to western stations 2 1/2 cents per hundredweight; on cotton to Hopefield and Memphis 50 per cent. of the through rate, after deducting the bridge and delivery charges; on merchandise to and from Memphis 50 per cent. of the through rate after deducting bridge tolls at Memphis; on grain and grain products from stations on the railroad company's line in the west 3 cents per hundredweight. The lumber company's acceptance of this basis for making of rates and divisions was declared to be upon the understanding that the agreement was for an exclusive interchange of business with the railroad company, except such traffic as the lumber company might desire to handle on the St. Francis and Mississippi rivers to Memphis or beyond.

Plaintiff succeeded to the rights of the Gifford-Frisbie Company, and took its place under the contract for the construction of the railroad. The railroad was never incorporated until after the commencement of this suit, but was a part of the lumber company's property, and used entirely in the business of the lumber company as a mere means of getting its output to the railroad company's tracks. The defendant later succeeded to the rights of the Choctaw, Oklahoma & Gulf Railroad Company.

This suit was brought to recover damages for failure to furnish and place upon the side track referred to an adequate supply of cars for the use of the plaintiff in hauling its products from the mill at Great Bend and along the line of its road to the railroad station at Round Pond for shipment over the defendant's road. The declaration may perhaps properly be construed as charging also a failure to furnish cars for the receipt of logs and lumber delivered along and upon defendant's right of way. Upon the trial in the Circuit Court verdict was directed for defendant upon the grounds that the defendant railroad was a common carrier; that, in the absence of special contract, the defendant company, as a common carrier, owed no duty to the plaintiff's road to supply the latter with rolling stock for the purpose of hauling freight over its own line; that the contract between the Choctaw, Oklahoma & Gulf Railroad Company and the Gifford-Frisbie Company did not require the railroad company to furnish cars to the lumber company; that the defendant's only duty was to receive for transportation logs and lumber delivered at Round Pond on the right of way of the defendant company; and that there was no proof of refusal or failure by the defendant to receive logs or lumber delivered upon its right of way. This court held that the plaintiff's railroad was not a common carrier; that the contract was thus not one between connecting common carriers, but between the railroad company as a carrier and the lumber company as a shipper, and that the former was by implication bound, on reasonable notice, to furnish cars on the side track in reasonably necessary numbers for the use of the lumber company in conducting its business. The judgement of the Circuit Court was accordingly reversed and new trial ordered. Taenzer v. Chicago, R.I. & P. Ry. Co., 170 F. 240, 95 C.C.A. 436.

Thereupon the defendant, by leave of the Circuit Court, filed therein four additional pleas to the declaration, as follows:

'First. And, for further plea in its behalf, the defendant avers that any special outstanding contract or agreement entered into between the plaintiff and defendant other and different from the common-law obligation imposed upon defendant as a common carrier of passengers and freight is illegal and void, in that it is contrary to the common law, the law of the United States, and the statutes of the state of Arkansas made and provided.

'And this it is ready to verify.

'Second. And, for further pleas in its behalf, the defendant avers that the contract and agreement, as set forth and construed in the plaintiff's declaration, is illegal and void as being contrary to section 6 of an act of the Congress of the United States, entitled, 'An act to regulate commerce,' approved February 4, 1887, as amended by an act approved March 2, 1889, and further amended by an act approved March 10, 1891, and still further amended by an act approved February 8, 1897, in that the plaintiff's declaration avers that the plaintiff is not a common carrier of freight or passengers, and under the act of Congress it is illegal and contrary to law for the plaintiff and defendant to enter into any contract or agreement concerning the rate to be charged for the transportation of either freight or passengers.

'Third. And for further pleas in its behalf the defendant avers that the contract on which the plaintiff seeks to recover, as set forth in its declaration and as therein construed, is illegal and void, being in violation of an act of Congress of the United States entitled, 'An act to regulate commerce,' approved February 4, 1887, as amended by an act approved March 2, 1889, and as further amended by an act approved March 10, 1891, and as further amended by an act approved February 8, 1897, in this: The defendant avers that it is a common carrier, engaged in the transportation of passengers and property wholly by railroad from one state of the United States to another state, to wit, from the state of Arkansas to the state of Tennessee, and as such is subject to the provisions of the act aforesaid; that in compliance with its duty in that behalf it duly establishes and publishes and files its schedule of rates, fares, and charges for the transportation of passengers and property between the states aforesaid in the manner as therein provided; that it has at all times so established, published, and filed its schedule of rates and charges for the transportation of property between points in the state of Arkansas and the state of Tennessee and other points in the several states through which its line runs, and particularly from Round Pond, Ark., to the city of Memphis; that such rates, fares, and charges so established, published, and declared were and are the lawful rates for the transportation of passengers and property between Round Pond and the city of Memphis aforesaid; that any division of said rates with any other person or party other than a common carrier is illegal and void; that the terms of the agreement set forth in the plaintiff's declaration taken in connection with the statements and allegations in said declaration contained, and as construed by said statements and said declaration, particularly taken in connection with the allegation that said plaintiff is not a common carrier, require this defendant to divide its lawful, established, published, and filed schedule of rates and charges for the transportation of the property in plaintiff's declaration described, with the plaintiff not as a common carrier, but as a

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