Title: Missouri-Kansas-Texas Rld. Co. v. Standard Industries

State: kansas

Issuer: Kansas Supreme Court

Document:

192 Kan. 381 (1964)
388 P.2d 632
MISSOURI-KANSAS-TEXAS RAILROAD COMPANY, a Corporation, Appellant,
v.
STANDARD INDUSTRIES, INC., a Delaware Corporation, Appellee.
No. 43,394

Supreme Court of Kansas.
Opinion filed January 25, 1964.
John B. Markham and Elmer W. Columbia, both of Parsons, argued the cause, and Herman W. Smith, Jr., of Parsons, and Lloyd Jones, of Denison, Texas, were with them on the briefs for the appellant.
Jack L. Goodrich, of Parsons, argued the cause and was on the briefs for the appellee.
The opinion of the court was delivered by
PARKER, C.J.:
This is an appeal from a judgment sustaining a demurrer to the first amended petition, hereinafter referred to as the petition, which sought to recover demurrage charges for delay in unloading freight cars. The issue presented for determination is the specific nature of the action, which will determine the particular provision of the statute of limitations governing the time in which the action must be commenced.
The facts governing the question to be determined must be gleaned from the petition.
After identifying the plaintiff as a common carrier by railroad, engaged in the transportation of property for hire in interstate and intrastate commerce, and the defendant as a Delaware corporation authorized to do business in the state of Kansas, the petition alleges:
Further allegations of the petition disclose that during the months of January and February, 1960, the plaintiff delivered to the defendant at Blum, Kansas, seventeen freight cars containing shipments of cement; that the shipments had been consigned to the defendant by the Universal Atlas Cement Company, Independence, Kansas, and had moved in intrastate commerce from point of orgin to destination; that the first of the cars in controversy was received by defendant January 5, 1960, and was released to plaintiff January 26, 1960; and that the next day the plaintiff delivered to defendant an instrument designated "DEMURRAGE BILL."
This demurrage bill, which was attached to and made a part of the petition, contained detailed information. It stated in large letters, "FOR DEMURRAGE CHARGES AT RATES AS PER PUBLISHED TARIFFS." It gave the car initial, number, date of arrival, date notice given, date ordered, date actually placed, and date released. Under remarks it also contained the following statement:
Similar demurrage bills, also attached to and made a part of the petition, were delivered to defendant following the release of the other sixteen cars. The last car in controversy was delivered to defendant February 13, 1960, and released to plaintiff March 26, 1960. The fifteen cars, not specifically referred to herein, were held from eighteen to forty-four demurrage days.
When examined in its entirety the petition further reveals that the failure of defendant to unload and release the cars resulted in the accrual and assessment of demurrage charges, under the tariff filed with the Commission, in the amount of $3,744.00.
*383 Plaintiff filed the action on February 8, 1962. Summons was served on February 16, 1962. Defendant's demurrer to the original petition was sustained by the trial court on June 30, 1962, without stating the grounds for that ruling. Thereupon, and on July 18, 1962, plaintiff filed its amended petition. Subsequently defendant lodged a demurrer against such pleading. It reads:
The lower court entered its judgment sustaining the foregoing demurrer and again did not state the grounds on which the demurrer was sustained. Plaintiff then appealed from such ruling.
At the outset, it may be stated, it appears from the briefs of the parties and arguments of their respective counsel that only the question of the statute of limitations is involved on appellate review.
Appellant contends that its action is to collect freight demurrage charges under its contract with appellee according to its tariffs on file with the State Corporation Commission, that such action is ex contractu in nature and is therefore governed by the three-year statute of limitations (G.S. 1949, 60-306, Second).
Appellee contends that an action to recover demurrage charges is for the recovery of a penalty or forfeiture and the one-year statute of limitations (60-306, Fourth) applies, but if not it is an action for taking or detaining personal property and the two-year statute of limitations (G.S. 1949, 60-306, Third) applies. It attempts to support this contention by suggesting that G.S. 1949, 66-211 and 66-212, providing for reciprocal demurrage, have been construed by this court as penal in nature. Appellant counters by pointing out that the reciprocal demurrage statutes have been superseded by G.S. 1949, 66-101, et seq., which gave the State Corporation Commission supervisory jurisdiction over the rates and charges of common carriers.
We agree with the contention of the appellant that an action to recover demurrage charges under the existing statutes is ex contractu in nature.
*384 Appellee calls our attention to the reciprocal demurrage statutes (see G.S. 1949, 66-201 to 66-204, incl., also 66-211 and 66-212) and insists that this court has construed such statutes to be penal in nature. This is true so far as the amount of the recovery, under those sections of the statute, is concerned. See Milling Co. v. Railway Co., 82 Kan. 256, 108 Pac. 137.
A penalty is a statutory liability imposed on a wrongdoer in an amount which is not limited to the damages suffered by the party wronged. (70 C.J.S., Penalties, § 1a, p. 389.) Such was the nature of the penal provision of the reciprocal demurrage statutes fixing the amount of the recovery. However, the penal provisions of such statutes have been superseded by the public utility act.
The reciprocal demurrage statutes were enacted in 1905. At that time railroads were regulated by piecemeal legislation which was enforced by fines, penalties, and mandatory writs. In 1911 the legislature passed a comprehensive act (Laws 1911, Chapter 238) covering the regulation of public utilities and common carriers. The supervision and control of public utilities and common carriers was placed in a commission with full power, authority, and jurisdiction (G.S. 1949, 66-101). The existing laws relating to regulations of railroads were transferred to the Commission (G.S. 1949, 66-103). The act contains the further provision:
The fact that the penalty provisions, in the form of exemplary damages, contained in the laws of 1905 covering reciprocal demurrage, are inconsistent with the provisions of the public utilities act of 1911 is readily demonstrated.
The public utility act requires every common carrier to establish joint and reasonable rates and charges (G.S. 1949, 66-107) and publish and file with the Commission copies of all schedules of rates and charges (G.S. 1949, 66-108). It prohibits any variations in the rates and charges from the schedule of rates and charges so filed and published (G.S. 1949, 66-109) and authorizes the Commission to investigate and establish just and reasonable rates and charges (G.S. 1949, 66-110).
*385 The provisions of the 1905 act, specifically applicable to railroads but similar to those heretofore noted as applicable to common carriers, were carried over in the 1911 act (G.S. 1949, 66-146, et seq.) and demurrage and storage charges were specifically included (G.S. 1949, 66-149). The rates and charges, including demurrage, of common carriers were no longer enforced by fines, penalties, and writs of mandamus but were enforced by rules, regulations and orders of the Commission. A common carrier could not exact any rates or charges other than those included in its filed schedule without an order of approval of the Commission (G.S. 1949, 66-109 and 66-117).
The rules and orders of the Commission, promulgated under statutory authority, are administrative details of the statutes and have the same force and effect (Stratton v. Atchison, T. & S.F. Rly. Co., 118 Kan. 673, 679, 236 Pac. 831).
It necessarily results that when demurrage charges are filed with the Commission and approved by it the demurrage schedule, as filed, has the force and effect of law and the carrier cannot deviate therefrom. Any attempt on the part of the carrier to collect more or less demurrage charges listed in the schedule filed would be discriminatory and in violation of G.S. 1949, 66-154 and 66-154a.
In Keeler Co. v. Atchison, T. & S.F. Rly. Co., 187 Kan. 125, 354 P.2d 368, this court, in discussing the effect of the Commission's order changing a rate schedule, said:
The foregoing statements and conclusions find support in well recognized legal treatises. See 13 C.J.S., Carriers, § 335, where it is said:
*386 See, also, 13 C.J.S., Carriers, § 334, which reads:
For additional general statements of similar import see 9 Am. Jur., Carriers § 598, where the following statements appear:
The nature and purpose of a demurrage charge is well stated in Turner Lumber Co. v. C., M. & St. P. Ry., 271 U.S. 259, 70 L. Ed. 934, 46 S. Ct. 530, where it is said:
*387 The generally accepted rule is that an action to recover demurrage charges by virtue of a filed schedule is ex contractu in nature.
See 13 C.J.S., Carriers, § 347, for the following statement:
For well considered decisions, to which we adhere, where the above stated rule is recognized and applied see Louisville & N.R. Co. v. Camody, 203 Ala. 522, 84 So. 824, which reads:
And see Atchison, T. & S.F. Ry. Co. v. Johnson, 99 Okla. 72, 225 Pac. 939, where, after quoting in the opinion from 4 R.C.L. 317, now 9 Am. Jur., Carriers, § 598, it is said:
In view of what has been heretofore stated and held we have little difficulty in concluding the involved action is ex contractu in nature and that the three-year statute of limitations (G.S. 1949, 60-306, Second) applies. It follows the demurrer to appellant's petition should have been overruled.
The judgment is reversed.
JACKSON, J., not participating.