Tom Hicks Trans. Co. v. Ford, Bacon & Davis Texas Inc.

• Decision Date: 27 June 1972
• Docket Number: No. 8057,8057
• Parties: TOM HICKS TRANSFER COMPANY, Inc., Appellant, v. FORD, BACON & DAVIS TEXAS INCORPORATED, Appellee.
• Court: Texas Court of Appeals

Page 364

482 S.W.2d 364

TOM HICKS TRANSFER COMPANY, Inc., Appellant, v. FORD, BACON & DAVIS TEXAS INCORPORATED, Appellee.

No. 8057.

Court of Civil Appeals of Texas Texarkana.

June 27, 1972.

Morgan Nesbitt, James, Robinson, Felts & Starnes, Austin, for appellant.

John A. Mackintosh, Jr., Thompson, Knight, Simmons & Bullion, Dallas, for appellee.

RAY, Justice.

This was a summary judgment proceeding in the District Court of Dallas County. The suit was instituted by appellant Tom Hicks Transfer Company, Inc., against Ford, Bacon & Davis Texas Incorporated, appellee, for freight charges in the sum of $4,769.73. Appellant alleged that it delivered certain machinery by motor carrier from Haltom Manufacturing Company in Dallas to the Shell Oil Company plant in South Louisiana consigned to appellee. Appellee answered by sworn denial that it paid Haltom Manufacturing Company for any applicable freight charges, and that since appellant had delivered the machinery to appellee with bills of lading marked 'prepaid,' appellant was estopped as a matter of law to collect unpaid freight charges from appellee, although Haltom Manufacturing Company had not in fact 'prepaid' the freight charges.

Both appellant and appellee filed motions for summary judgment based on the affidavits, pleadings and stipulations on file. The District Court of Dallas County entered a no-liability judgment for appellee Ford, Bacon & Davis Texas Incorporated after sustaining appellee's motion for summary judgment and overruling appellant's motion for summary judgment.

The majority of the pertinent facts in this case were stipulated between the parties in the trial court. Over a period of months in 1967, appellee purchased machinery from Haltom Manufacturing Company of Dallas, Texas, and the purchase order for the equipment specified that appellee was to receive the machinery from Haltom Manufacturing Company f.o.b. job site. After delivery, appellee paid Haltom Manufacturing Company in full for the equipment and the applicable freight charges. Consignor Haltom Manufacturing Company contracted with appellant, Tom Hicks Transfer Company, Inc., for the transportation of the heavy equipment to the job site at Shell Oil Company's Bayou Goula refinery in Southern Louisiana. It was stipulated by the parties that on each of the memorandum bills of lading under which the shipments moved, the word 'prepaid' had been typed by appellant in the space on the printed form headed 'If charges are to be prepaid, write or stamp here: 'To be Prepaid." It was stipulated that appellee accepted the shipments of equipment in reliance upon appellant's representations that all freight charges had been 'prepaid' by consignor Haltom Manufacturing Company . The true facts were that appellant carrier elected to extend credit to Haltom Manufacturing Company and the freight charges were not 'prepaid' as represented. Appellant later sought payment from consignor Haltom Manufacturing Company, but was unable to collect the freight charges. The parties stipulated that Haltom Manufacturing Company was insolvent on the date of the presentation of their respective motions for summary judgment in the trial court. Appellant now seeks recovery of the unpaid freight charges from appellee Ford, Bacon & Davis Texas Incorporated notwithstanding its earlier representation that the charges had already been paid prior to the delivery. Appellee denied liability for the unpaid freight charges and submitted that appellant was estopped to collect such unpaid charges because of its prior conduct in representing to appellee that prepayment had been made by Haltom Manufacturing Company.

Appellant's theory of recovery is that the Interstate Commerce Act, 49 U.S.C.A. Sec. 317, and Uniform Bill of Lading Sec. 7 creates a public duty on the part of the interstate motor carrier to collect its freight charges from the consignee, Ford, Bacon & Davis Texas Inc., notwithstanding the fact that the carrier had previously delivered the equipment to the consignee representing prepayment of the freight charges by the consignor, Haltom Manufacturing Company. Appellee contends that the trial court correctly held that the doctrine of estoppel was applicable, and that public policy and the provisions of the Federal Statutes do not require appellee to pay the freight charges twice (once to the consignor and once to the carrier).

Insofar as we have been able to determine, this is the first Texas decision construing the Interstate Motor Carrier Section of the Interstate Commerce Act, 49 U.S.C.A. Secs. 317 and 323, concerning whether those sections and public policy demand that the freight charges be collected from the consignee when the merchandise was shipped by the consignor via motor carrier by bill of lading stamped 'Prepaid' when such charges are uncollectible from the consignor.

Appellant contends that the trial court erred in failing to require the consignee, Ford, Bacon & Davis Texas Inc., to pay the applicable freight charges upon failure of the shipper to pay such charges, even though the shipments were marked 'Prepaid.' Appellant further contends in its point of error No. 2, that as a matter of law, a consignee cannot accept delivery of an interstate shipment without incurring liability for the carrier's lawful charges, known or unknown, supposed to be prepaid or otherwise.

The applicable provisions of the Interstate Commerce Act, 49 U.S.C .A., provide the following:

'Sec. 317(b) No common carrier by motor vehicle shall charge or demand or collect or receive a greater or less or different compensation for transportation or for any service in connection therewith between the points enumerated in such tariff than the rates, fares, and charges specified in the tariffs in effect at the time; and no such carrier shall refund or remit in any manner or by any device, directly or indirectly, or through any agent or broker or otherwise, any portion of the rates, fares, or charges so specified, or extend to any person any privileges or facilities for transportation in interstate or foreign commerce except such as are specified in its tariffs: . . ..'

'Sec. 317(d) No common carrier by motor vehicle, unless otherwise provided by this chapter, shall engage in the transportation of passengers or property unless the rates, fares, and charges upon which the same are transported by said carrier have been filed and published in accordance with the provisions of this chapter.'

The pertinent part of Section 7 of the Uniform Bill of Lading provision is as follows:

'The owner or consignee shall pay the freight and average if any, and all other lawful charges accruing on said property; but, except in those instances where it may lawfully be authorized to do so, no carrier shall deliver or relinquish possession at destination of the property covered by this bill of lading until all tariff rates and charges thereon have been paid. The consignor shall be liable for the freight and all other lawful charges, except that if the consignor stipulates, by signature, in the space provided for that purpose on the face of this bill of lading that the carrier shall not make delivery without requiring payment of such charges and the carrier, contrary to such stipulation shall make delivery without requiring such payment, the consignor (except as hereinafter provided) shall not be liable for such charges. Provided, That, where the carrier has been instructed by the shipper or consignor to deliver said property to a consignee other than the shipper or consignor, such consignee shall not be legally liable for transportation charges in respect of the transportation of said property (beyond those billed against him at the time of delivery for which he is otherwise liable) which may be found to be due after the property has been delivered to him, if the consignee (a) is an agent only and has no beneficial title in said property, and (b) prior to delivery of said property has notified the delivering carrier in writing of the fact of such agency and absence of beneficial title, . . ..'

Sec. 323 of 49 U.S.C.A. provides in part as follows:

'No common carrier by motor vehicle shall deliver or relinquish possession at destination of any freight transported by it in interstate or foreign commerce until all tariff rates and charges thereon have been paid, except under such rules and regulations as the Commission may from time to time prescribe to govern the settlement of all such rates and charges, including rules and regulations for weekly or monthly settlement, and to prevent unjust discrimination or undue preference or prejudice. . . .'

Appellant contends that both the shipper and the consignee are equally liable for freight charges and that the carrier may collect from either. The transfer company further states that the shipper's obligation to pay the freight charges is incurred when he tenders the shipment to a carrier at the origin point...