Case Title: Brown v. Bonesteele

Citation: 218 Or. 312, 344 P.2d 928

Docket Number: 

State: oregon

Court: Oregon Supreme Court

Date: 1959-10-14T00:00:00Z

Document:
Reversed and remanded October 14, 1959.
*315 Asa L. Lewelling, Salem, argued the cause for appellant. On the brief were Lewelling & Gies, Salem.
Otto R. Skopil, Salem, argued the cause for respondent. On the brief were Williams & Skopil, Salem.
Before McALLISTER, Chief Justice, and WARNER, SLOAN, O'CONNELL and KING, Justices.
REVERSED AND REMANDED.
O'CONNELL, J.
This is an action for damages brought by a shipper against a carrier to recover for the loss by fire of a truck load of twine while being transported in defendant's truck. The origin of the fire was not established although it is probable that it resulted from placing the twine too close to the exhaust pipe which was exposed in the interior of the truck. Werner Brown holds all but two shares of the stock of plaintiff corporation. We shall refer to him as the plaintiff.
The complaint is drawn on the theory that the defendant had possession of the goods as a common *316 carrier and was, therefore, absolutely liable for their loss. The defendant denies that he was acting as a common carrier in this instance, although the truck which was used was under a common carrier permit issued by the Public Utilities Commissioner of Oregon. He further contends that the loading of the truck was done under the direction and control of plaintiff's servants and that the loss was due to their negligence. As a separate defense it is alleged that the truck was rented to the plaintiff and that it was under the plaintiff's control in the course of loading and hauling the goods in question.
The case was submitted to the jury which found for the defendant. Several assignments of error are relied upon, the principal one being that the trial court should have directed a verdict for the plaintiff on the ground that the evidence clearly established the status of the defendant as a common carrier and there were no other questions of fact requiring the jury's deliberations.
The defendant's principal business is the storage of goods. However, he is also engaged in the business of transporting goods for others, which he does under a permit from the Public Utilities Commissioner authorizing him to haul goods as a common carrier within the city of Salem and not to exceed 25 miles outside of Salem. He filed two tariff schedules with the commissioner, one establishing an hourly rate of six dollars for cartage within the city of Salem, and a hundredweight rate for hauls outside the city.
1. The principal question before us is whether there is any substantial evidence to submit to a jury showing that defendant had changed his status in this particular instance from that of common carrier to that of a lessor of a truck or as a carrier contracting to haul goods *317 under a special contract of carriage. As a common carrier defendant would be liable as an insurer for the loss of plaintiff's goods. Lacey v. Oregon R. & N. Co., 63 Or 596, 128 P 999 (1913); Brown, Personal Property (2d ed 1955), p 416. As a contract carrier or lessor he would be liable only if the loss resulted from his fault. A common carrier is defined in ORS 767.005 (5) as follows:
A contract carrier is defined in ORS 767.010 (1):
As a part of his business plaintiff sells twine to various canneries in the Salem area. The canneries distribute the twine to farmers engaged in the production of string beans. The twine, packed in cartons, is shipped to Salem by railroad. The plaintiff then distributes the twine to his customers by truck.
On March 18, 1955 plaintiff, upon learning that a carload of twine was on its way to Salem, got in touch with defendant to make arrangements for the hauling of the twine to various canneries. There is a conflict of testimony as to what was said in this conversation. Plaintiff testified as follows:
Plaintiff testified that he informed defendant of the weight and destination of the twine.
With respect to the arrangements for payment, plaintiff testified as follows:
The defendant's testimony relating to the agreement to transport the twine was as follows:
The bill for the 1954 hauling job was submitted after the job had been completed, the invoice indicating that the charge was for three men and a truck for eight hours. The defendant testified that the 1954 charge was based upon an hourly rate of five dollars and that the charge for the 1955 job was six dollars, although no bill was sent for the latter job. No bill of lading was issued for either the 1954 or the 1955 hauls.
The defendant contends that the plaintiff's conduct in supervising and controlling the loading operation is further proof that the defendant never assumed the status of a common carrier. The railroad car containing the twine was spotted at the siding serving the Paulus warehouse rather than at the defendant's siding. During the course of the unloading plaintiff was inside of the box car checking off the serial number of each carton as it was removed from the car. The loading of the defendant's truck was done under the immediate direction of the defendant's regularly employed truck driver. He decided where the cartons were to be placed in the truck as they were brought to the truck bed by others. When the entire cargo was loaded he leveled the load off and tied it down. Plaintiff was not present at the truck during the loading operations. When he had finished checking the cartons in the box car he left. The truck had not been completely loaded at that time. At one point in the loading operation the truck driver went into the box car and discussed something with Brown. Claude Martin, the foreman in charge of the Paulus employees, who was employed to assist in the unloading operation testified that the driver made *321 inquiry of the plaintiff as to the number of cartons remaining to be loaded. Martin understood that the inquiry was made by the driver to determine whether he could take the entire cargo in one load. Thereafter the driver left for a short while. Martin surmised it was to use the telephone but there was no evidence to support the conjecture and the driver denied that he made a telephone call at the Paulus warehouse. The driver testified that in his conversation with plaintiff he "tried to find out how big a load and how much I was to take." He also testified that the plaintiff directed him to park the truck so that it could be loaded by lift truck, and when loaded where to deliver the cargo. The driver was paid by defendant, the Paulus employees were paid by plaintiff who was eventually to be reimbursed by the shippers.
2. The foregoing is a fair summary of the principal evidence relevant to defendant's status in the transaction with plaintiff. It is undisputed that the defendant held himself out to the public as a common carrier. That being so, it would devolve upon him to establish that the transaction with plaintiff was not in the regular course of his ostensible calling.
3, 4. It is not for us to weigh the evidence except to determine whether defendant has put enough in the scale to get to the jury. In making that judgment we are entitled to consider the fact that defendant did *322 not comply with the regulations promulgated by the Public Utility Commissioner pursuant to statute. Under those regulations a permittee who wishes to lease a vehicle operating under a permit must pay a fee, and obtain the necessary evidence of authorization from the commission. This was not done in the present case. The fact that the regulation and statutes were violated does not, in itself, preclude a finding that a permittee changed from a common carrier to some other status in the particular instance. However, there is a strong presumption that one does not violate the law, and that presumption can be taken into account by us in interpreting the transaction in question for the purpose of determining whether the case should go to the jury.
What evidence was presented to show that defendant temporarily changed his common carrier status? The conversations between the parties prior to the arrival of the railroad car contained nothing of substance to establish a lease of the vehicle for this one transaction. The general language concerning destination, weight of cargo, the rate to be charged, the location of the railroad car for loading purposes, plaintiff's agreement to supervise the loading, and the absence of a bill of lading are relied upon by defendant as evidence of a lease transaction. But it is not uncommon for shippers to order trucking services without specifying the details of rate, weight of cargo and the like, or without demanding a bill of lading. The failure to designate the destination is of little importance in the present case because defendant knew the nature of the haul, and the specific destination was of little consequence.
5. It has been held that where the owner of a vehicle rents it, together with a driver, for a temporary purpose the right of the hirer to prescribe cargo, destination *323 and route does not constitute sufficient control over the driver to make him the hirer's servant. Densby v. Bartlett, 318 Ill 616, 149 NE 591, 42 ALR 1406 (1925); Turner v. Schumacher Motor Express, Inc., 230 Minn 172, 41 NW2d 182 (1950); Antonelly v. Adam, 175 Minn 438, 221 NW 716 (1928). Other cases illustrating this principle will be dealt with below. The owner's surrender of control over his vehicle and driver has significance in determining liability only as such giving up of control has relevance in explaining why the owner or hirer should bear the loss. The hirer's privilege to designate the destination of the goods would be relevant in determining his liability were he to choose a danger-out route to suit his needs. Likewise, if a hirer has been given the privilege to control the specific manner of loading and if, in preparing the load, he creates a risk which results in the loss of the load there is reason for shifting the burden of loss to him.
But there is no substantial evidence of any connection between right to control and risk in the present case. The plaintiff's reservation of the right to spot the railroad car at the Paulus siding rather than at defendant's warehouse siding is not relevant to the risk which created the loss here. Likewise, plaintiff's supervision over the unloading is not relevant. There is no evidence that defendant surrendered to plaintiff the right to designate the manner in which the cartons were to be placed on the truck and there is no evidence that plaintiff actually exercised control over the loading in this respect. There is, therefore, no relationship between the control reserved and exercised by plaintiff and the cause of the loss to the load. The necessity of establishing a connection between the right to control and the specific act causing the harm when one's *324 servant is loaned to another is explained in 1 Restatement, Agency 501, § 227, comment a:
6. The defendant argues in effect that the driver in the present case became a loaned servant of plaintiff, but the evidence does not support the argument. The truck driver was paid by defendant for the work he performed on the day in question. He reported back to defendant, not to plaintiff when the fire destroyed the load. There was no evidence to rebut the inference that a servant remains in his general employment when performing services for another. 1 Restatement, Agency 501, § 227, comment b.
The comment in 1 Restatement, Agency 502, § 227, comment c is in point:
Support for the position that the plaintiff did not become a private carrier can be found in the cases dealing with interstate regulation of motor carriers. The Interstate Commerce Commission and the federal courts have been called upon to determine whether the leasing of equipment by a carrier to a shipper results in removing the carrier from the status of a common or contract carrier in interstate commerce. Although the question in such cases is not in all respects the same as that before us, the commission's and courts' treatment of the problem of control is relevant to our inquiry. An illustrative case is John J. Casale, Inc., Contract Carrier Application, No. MC 20314 reported in 4 Fed Carr Cas 356, par. 30,861. There the applicant for a permit was found to have engaged in the practice of leasing equipment to shippers. Applicant contended that it was not engaged in the carriage of goods under the lease arrangements and that such portion of its business was not subject to regulation by the commission. The commission held that the applicant continued to be a carrier (a contract carrier in this instance) and the shipper, in using the leased equipment, was not *326 engaged in private carriage. The opinion contains the following language:
Accord: Interstate Commerce Commission v. Isner, 92 *327 F Supp 582 (DC Mich 1950); Interstate Commerce Commission v. F & F Truck Leasing Co., 78 F Supp 13 (DC Minn 1948); U.S. v. LaTuff Transfer Service, Inc., 95 F Supp 375 (DC Minn 1950). For cases involving state regulation see Entremont v. Whitsell, 13 Cal2d 290, 89 P2d 392 (1939); Re Frank Ferens, 58 PUR NS 525 (1945).
These cases support the plaintiff's contention that it was not a private carrier using leased equipment. The conclusion in these cases that the carrier was a contract carrier does not weaken plaintiff's position in the present case that defendant continued to be a common carrier in his relation to plaintiff. In the cases cited the equipment was used under definite leasing arrangements clearly establishing a special contract of carriage; in the instant case there was no substantial evidence to establish a special contract negativing the status of a common carrier.
As we have already stated, the defendant has the burden to prove that he changed from a common carrier to some other status. That burden is properly described in the case of John J. Casale, Inc., supra, where the court said:
In Interstate Commerce Commission v. F & F Truck *328 Leasing Co., supra, the court described the carrier's burden of proof as follows:
To the same effect is The New Jersey Steam Navigation Co. v. The Merchants' Bank, 6 Howard 344, 12 L ed 465 (1848) which will be discussed below. The cases involving the attempt of a carrier to limit its liability by agreement uniformly hold that the burden is on the carrier to prove the limitation. Hill v. Adams Express Co., 82 NJL 373, 81 A 859 (1911); Lacey v. Oregon R. & N. Co., 63 Or 596, 128 P 999 (1913); McGregor v. Oregon R. & N. Co., 50 Or 527, 93 P 465 (1908). We shall make further reference to defendant's burden of proof later in this opinion.
7, 8. Defendant attached significance to the fact that plaintiff did not demand and did not receive a bill of lading. Apparently, it is defendant's theory that since common carriers are required to issue bills of lading the fact that defendant did not issue one in the present case is evidence that the parties did not intend that he serve as a common carrier. Bills of lading frequently are not issued by carriers until after the completion of the job. For example, see McGregor v. Oregon R. & N. Co., supra. In the circumstances of this case, where the parties were acquainted with each other, had previously arranged for a similar movement of goods, and where the hauling job would be completed in one trip, we do not regard as significant the failure of the defendant to issue a bill of lading to the plaintiff. Certainly a common carrier cannot change its status, *329 with the concomitant liability as insurer, simply by violating its obligation to issue a bill of lading. A bill of lading is not necessary to subject the carrier to liability as insurer of the goods. 1 Hutchinson on Carriers, (3d ed 1906), p 160. As stated in Blackwell v. Oregon Short Line Ry. Co., 82 Or 303, 161 P 565 (1916):
To the same effect see Alabama Midlands Ry. Co. v. Darby, 119 Ala 531, 24 So 713 (1898); Meloche v. Chicago, M. & St. P. Ry. Co., 116 Mich 69, 74 NW 301 (1898); Missouri, K. & T. Ry. Co. of Texas v. Beard, 34 Tex Civ App 188, 78 SW 253 (1904); Martin v. Ft. Worth & D.C. Ry. Co., 3 Tex Civ App 556, 22 SW 1007 (1893); Texas P. Ry. Co. v. Nicholson, 61 Tex 491 (1884). Under the circumstances present in this case we do not regard the failure to issue a bill of lading as having any weight in determining the defendant's status.
As further evidence that there was a special contract between the parties, defendant points to the fact that the rate charged in the present case was different from that called for under the tariff of rates filed by him with the Public Utilities Commissioner. As we have already indicated, the filed tariff permitted defendant to charge an hourly rate of six dollars for cartage within the city of Salem and a rate on the basis of hundredweight for trips outside the city. The rate charged in the present case was six dollars an hour. This would conform to the intracity tariff but not the tariff for the haul to Stayton which was the destination of the load involved in this case. The defendant tesitfied that the cost of hauling plaintiff's goods under *330 the tariff would have been $95 to $100, whereas at the hourly rate the cost was between $35 to $40. It does not appear whether this difference between the two charges would be the same if plaintiff had not assisted in the unloading operation.
The answer to defendant's contention is found in Shikany v. Salt Creek Transp. Co., 48 Wyo 190, 45 P2d 645 (1935), a case very similar to the case at bar. There the plaintiff shipper brought an action against the defendant carrier to recover the sum of $2,500, the value of an oriental rug delivered to the defendant, for transportation between two cities in Wyoming. The carrier claimed that it did not act as a common carrier in the particular transaction. It pleaded that:
The court said:
In the instant case defendant argues that the agreement to handle the transaction on the same basis as the transaction in the previous year established the manner of fixing the rate and that the rate used in the previous year was under a leasing arrangement. The weakness in this position is that the character of the previous transaction was never clearly established as a lease arrangement rather than as a regular agreement for transportation by a common carrier.
9. It is our opinion that the jury could not justifiably conclude that the defendant relieved himself of his liability as a common carrier by charging the intracity rate for the cartage in this case. We can find no basis for the defendant's conclusion that the truck was leased to plaintiff. Here was a valuable piece of equipment, the use of which could create myriad legal problems. Normally, the parties to a lease of such equipment *332 would agree upon their respective rights and liabilities; ordinarily their agreement would be reduced to writing. The parties in the instant case made no effort to resolve these problems, but instead dealt upon the basis of a conversation which amounted to nothing more than the ordinary request by a shipper for trucking service and the acceptance of the business by the carrier. We are of the opinion that the defendant did not present sufficient evidence from which the jury could properly find the relation of lessor and lessee between the defendant and plaintiff.
10. We have assumed arguendo that the defendant could, by special agreement, assume the role of contract carrier in transporting plaintiff's goods and thereby obtain immunity from the strict liability of a common carrier. That assumption generously favored the defendant's case. If a common carrier enters into a special contract to carry the same type of goods as he is authorized to carry under his permit he does not thereby change his position as a common carrier. This is clearly stated in New York Central Railroad Co. v. Lockwood, 84 US 357, 21 L ed 627 (1873):
11. It is true that a common carrier may, under certain circumstances, continue its position as a common carrier and by special agreement limit its liability. But the limitation on its liability will not be recognized unless it is clearly manifested. This principle is recognized in Voyt v. Bekins Moving & Storage Co., 169 Or 30, 119 P2d 586, 127 P2d 360 (1942) which relies upon The New Jersey Steam Navigation Co. v. Merchants' Bank, supra. In the latter case the court said:
See also Wells v. Great Northern Ry. Co., 59 Or 165, 114 P 92, 116 P 1070, 34 LRA NS 818 (1911); Seller v. Steamship Pacific, 1 Or 409 (1861).
*334 12. Accepting defendant's argument that there was a special agreement between him and the plaintiff with respect to the carriage of plaintiff's goods there was no agreement exonerating defendant from his common carrier liability. There certainly was no express agreement, and even if it were permissible to excuse defendant from liability upon the basis of an implied agreement, there was nothing in the preliminary negotiations for the hauling and there were no circumstances attendant upon the actual loading and transportation of the goods from which such an agreement could be implied. There being no agreement relieving the defendant from liability the jury would not be entitled to find one by implication or conjecture.
13. It is our conclusion that the defendant was a common carrier in transporting the plaintiff's goods. As a common carrier he is absolutely liable for the loss of goods entrusted to his care unless he can establish that the case falls within one of the exceptions to the general rule of strict liability, i.e., that the loss resulted from an act of God, or an act of the state, the public enemy, or the shipper, or that the damages were due to the inherent nature of the goods themselves. Brown, Personal Property (2d ed), p 423, et seq.
Defendant has not shown that his case is within any of these exceptions. Applying the fourth exception above excusing the carrier from liability where the loss results from the shipper's own conduct, if defendant had established that the goods were destroyed as a result of plaintiff's negligence in loading the truck (and it was also established that defendant or his servants were not negligent) the plaintiff would be barred from recovery. But defendant did not prove that plaintiff or his servants were negligent.
*335 14-16. The trial judge should have directed a verdict for the plaintiff leaving to the jury only the question of the amount of damages. The question of the amount of damages was not entirely resolved in the trial of the cause. We must, therefore, remand the case for a new trial. However, the issue of liability and the issue of the amount of damages are separable and since we have decided that defendant is liable for the loss we remand the case for a new trial only on the issue of the amount of damages recoverable by plaintiff. Under appropriate circumstances this court may remand a case for a new trial on a part only of the issues raised in the original proceeding. Dunn v. Henderson, 122 Or 331, 258 P 183 (1927); cf., Scott v. Brogan, 157 Or 549, 73 P2d 688 (1937); Hust v. Moore-McCormack Lines, Inc., 180 Or 409, 177 P2d 429 (1947); Oliver v. Skinner and Lodge, 190 Or 423, 226 P2d 507 (1951). This practice, is in accord with that recognized in most other states. See Annotations in 98 ALR 941, supplemented in 29 ALR2d 1199. The cases make it clear that the granting of a new trial on a part of the issues only is subject to certain limitations (e.g., see 29 ALR2d 1199 at 1209). None of these limitations is applicable to the present case.
The judgment is reversed and the cause is remanded for a new trial on the issue of the amount of damages only.