No. 12144 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1972 

EISENMAN SEED COMPANY, 

a Corporation, 

Plaintiff and Respondent, 

CHICAGO, MILWAUKEE, ST PAUL AND 

PACIFIC RAILROAD, a Corporation, 

Defendant and Appellant. 

Appeal from: District Court of the First Judicial District, 

Honorable Gordon R, Bennett, Judge presiding. 

Counsel of Record : 

For Appellant: 

Garlington, Lohn and Robinson, Missoula, Montana, 

Robert E. Sheridan argued, Missoula, Montana, 

For Respondent: 

Brazier, Dowling and Erickson, Helena, Montana, 

Geoffrey L, Brazier argued, Helena, Montana, 

Submitted: November 29, 1972 

Decided : 

JAfj -: ; .*: 7 2 

3kN 1 6 1973 

Filed : J 

Clerk 
Mr. Justice Wesley Castles delivered the Opinion of the Court. 

This appeal is taken from a judgment for plaintiff entered by 

the district court of the first judicial district, Lewis and Clark County, 

and the court's subsequent denial of defendant's exceptions to the findings of fact and conclusions of law and its motion to amend such findings 

of fact and conclusions of law. 

The principal issue involved is whether defendant is liable to 

plaintiff for loss of grain occurring after defendant delivered the shipment to the consignee. 

Plaintiff, Eisenman Seed Company (hereinafter referred to as 

Eisenman), commenced this action in the district court seeking to recover 

from defendant Chicago, Milwaukee, St. Paul and Pacific Rai 1 road (hereinafter referred to as Milwaukee), certain sums of money as the result of 

an alleged loss of malting barley occurring on shipments from Fairfield, 

Montana to Duluth, Minnesota. The basis for Eisenman's claim was that the 

grain was transported in defective equi vent belonging to Milwaukee and 

further, that Milwaukee was negligent in the transportation, handling and 

delivery of the grain. 

During the year 1968, Eisenman shipped numerous carloads of malting barley from various points along the Agawam branch line of Milwaukee 

in Montana for delivery to Capita1 Elevator Co. (hereinafter referred to 

as Capital ) , the consignee in Dul uth, Minnesota. 

Prior to loading, the grain was weighed by Eisenman on automatic 

scales and this weight was used in preparing the bills of lading. The grain 

was again weighed upon arrival at Capital in Duluth. According to the 

testimony of Joe Eisenman, president of Eisenman, the grain was not weighed 

at Capital until after it was unloaded from the railroad cars. The grain 

was also weighed on track scales of Milwaukee at Great Falls, but these 

weights are not at issue in this appeal. The loss covering 39 carloads 

amounted to 19,200 pounds, or 492 pounds per car. The total judgment here 

was for $499.20. 
As a result of discrepancies between Eisenman's weights and those 

obtained by Capital, thirty-nine claims were filed with Milwaukee, which 

form the basis of this litigation. All of the claims involved are commonly 

referred to as "clear record claims". A clear record claim was defined by 

Harold Whatmore, a freight claim agent of Milwaukee, as "a movement of a 

car, which from the point of origin to its point of destination, had no detectable leaks." 

Each car upon which a claim was filed was inspected by the Duluth 

Board of Trade after arrival at Capital, and an official weight inspection 

certificate issued on the contents after unloading. The following excerpt 

from Mr. Eisenmenls testimony indicated, as did the individual weight and 

inspection certificates, that no defects were noted on any of the cars and 

no leaks were detected. 

"Q. Well, let me ask you this: For each one of the claims 

that you have filed, you have received from the railroad 

a copy of the Duluth Board of Trade official weight certificate, is that not correct? A. That's right. 

"Q. And for each one of the weight certificates, an 

inspection form must be filled out by the supervising 

weighmaster, is this not also true? A. That's right. 

"Q. And on each one of these cars, or these claims that 

are filed, it's noted that that particular weighmaster 

checked the box car and noted no leaks detected? A. Yes." 

The testimony of Mr. Eisenman was corroborated by that of Mr. Whatmore. Thus, the proof that the 39 cars were delivered intact. 

Capital, the consignee, had been designated by Eisenman through its 

broker, Hufford & Hufford. Milwaukee had nothing to do with the designation 

of the consignee. The grain was unloaded at Duluth by Capital and no employees or agents of the railroad took part in the unloading process. There 

was also no affiliation or agreement between Milwaukee and Capital by which 

the latter could have been construed as the agent of Milwaukee. 

The unloading of the grain took place at a private siding belonging 

to Capital in Duluth. Milwaukee was then notified by Capital that each car 

was released to the railroad after it was unloaded. 
The uncontroverted testimony of Mr. Eisenman was that the grain 

loss was occurring because the cars were improperly unloaded at Capital, 

with the result that grain was being left in the cars. Because of the 

importance of this testimony, we quote verbatim the fol lowing excerpts 

from the transcript: 

"Q. (By Mr. Sheridan, counsel for defendant) In the 

unloading of the grain, the grain is often left in the 

car---now, is that clear enough in that form of question? 

A. Yes. 

"Q. The grain simply is not all dumped out of the car, 

is that not right? A. Yes. 

"Q. The grain is just not a11 dumped out of the car--- 

A. Right. 

"Q. ---by the mechanism they use? A. That's right. 

"Q. And could you describe for me how Capital Elevator 

Company, if you know, unloads the grain out of these cars? 

A. Well, I can't give you the exact procedure that they 

use to unload them, other than the regular unloading 

methods that you'd find at any terminals. 

"And that is, that they dump these cars into hoppers and 

then they are automatically weighed after they are 

dumped into hopper cars and then set back on the track, 

and that is the actual grain that's dumped out of the 

cars---the actual weight, but our point is this: How 

much was actually left in the car after it was dumped. 

"Q. So it's your feeling that these cars aren't being 

properly unloaded when they arrive at Duluth, is that not 

correct? A. I would have to say 'Yes' to that question. 

"Q. And that you're not being given credit for the grain 

which you shipped from Great Falls simply because the 

grain was not being properly unloaded at Capital Elevator? 

A. Yes. 

"Q. And there was grain being left in the cars that were 

returned to you, or to whoever else that car is returned 

to? A. That's right. 

"Q. And you feel that this happens on practically every 

car? A. Well, I would not say every car, but it happens 

on a good percentage of the cars, Mr. Sheridan, yes." 

Two other facts are essential to a determination of this case. 

(1) On October 9, 1970, Eisenman submitted requests for admissions 

to Milwaukee, one of which was: 

"15. That sloppy unloading and car cleaning practices 

at the point of destination may cause losses in the 
del iveries of grains by interstate common carriers for 

hire, including railroads." 

On October 23, 1970, Milwaukee admitted the above request but emphasized that in this instance the unloading and car cleaning was not 

performed by, nor was it the responsibility of Milwaukee. 

(2) The freight tariff, which controlled this shipment and which 

was admitted in evidence by the trial court, specifically stated that the 

duty to unload rested upon the shipper. 

Throughout the trial, the trial judge expressed concern over the 

question of when the railroad lost control of the shipment and who was 

responsible for losses occurring due to the failure of the consignee to 

properly and completely unload. At the conclusion of the trial, the trial 

judge stated he wanted to know just when the responsibility of the railroad 

ended. 

Milwaukee contends that this is indeed the crucial question in this 

case and appeals from the trial court ruling that the railroad's responsibility for the grain and liability for its loss continued beyond the time the 

grain was delivered to the siding of the consignee. 

Two issues are presented on appeal: 

1. Whether the trial court erred in applying state rather than 

federal law. 

2. Whether the trial court erred in holding Milwaukee liable for 

the loss of grain where the evidence clearly showed the railroad cars were 

not defective, and that the loss occurred after the grain was in the possession of the consignee. 

Counsel for both parties admitted in their respective trial briefs 

that the controlling law was 49 U.S.C. § 20(11). However, the trial court, 

in its findings and conclusions of law referred to section 8-812, R.C.M. 

1947, as controlling. Specifically, in finding of fact VII and conclusion 

of law 111, the court stated that the railroad was not entitled to relief 

from 1 iabil i ty under the exceptions provided in section 8-81 2. 
The shipment of ma1 ting barley originated in Montana and terminated 

in Duluth, Minnesota. That such a shipment was in interstate commerce is 

so obvious as to not require discussion or elaboration. Suffice it to say 

that the shipment involved crossed several state lines and involved persons 

and businesses of several different states. 

The Constitution of the United States has reserved and granted to 

Congress the power to regulate commerce among the several states. Art. I, 

Section 8, United States Constitution. While there is authority to the 

effect that states may legislate on certain matters affecting interstate 

commerce, unless and until Congress legislates, there is no question that 

once Congress regulates interstate commerce by enacting a statute, it 

preempts the field and supersedes all state legislation affecting the same 

subject. In referring specifically to 49 U.S.C. 5 20(11), known as the 

Carmack Amendment, in Adams Express Co. v. Croninger, 226 U.S. 491, 33 S.Ct. 

148, 57 L.ed. 314, 320, the United States Supreme Court said: 

"That the 1 egislation supersedes a1 1 the regulations 

and policies of a particular state upon the same subject results from its general character. It embraces 

the subject of the liability of the carrier under a bill 

of lading which he must issue, and limits his power to 

exempt himself by rule, regulation, or contract. Almost 

every detail of the subject is covered so completely 

that there can be no rational doubt but that Congress 

intended to take possession of the subject, and supersede 

all state regulation with reference to it. Only the 

silence of Congress authorized the exercise of the police 

power of the state upon the subject of such contracts. 

But when Congress acted in such a way as to manifest a 

purpose to exercise its conceded authority, the regulating power of the state ceased to exist." 

See also: New York, New Haven & Hartford Railroad Co. v. Nothnagle, 346 U.S. 

The liabil ity of Milwaukee should have been determined with reference to the provisions of the Carmack Amendment and related case decisions, 

and not with regard to Montana law. At best, the Montana statute upon which 

the trial court relied could have only been controlling with respect to 

shipments purely intrastate in character. Where, as here, the shipment was 

in interstate commerce, the trial court erred in applying state rather than 
federal law. 

The wording of the Carmack Amendment is important in determining 

the liability of the comon carrier, specifically, in this instance, the 

Milwaukee Railroad. 49 U.S.C. 9 20(11), states, in part, that the carrier: 

" * * * shall be liable to the lawful holder of said -. . 

receipt or bill of lading * * * for the full actual 

loss, damage, or injury to such property caused by it". 

]Emphasis added.) 

The emphasized portions are important because they indicate that liability 

shall be placed upon the carrier only when it causes the loss. Here, the 

record is entirely devoid of any testimony which would indicate that any 

1 oss of grain occurred while the grain was in the possession of Milwaukee. 

To the contrary, the record indicated that each car upon which a claim was 

filed was inspected on arrival at Capital in Duluth, by a disinterested 

third party, namely, the Duluth Board of Trade, and no leaks of any nature 

were detected. 

On the other hand, the record is replete with testimony, including 

that of Mr. Eisenman, president of Eisenman Seed Co., that the grain loss 

was occurring because that grain was being improperly and incompletely unloaded at Capital. The principal issue then becomes---who had the responsibility for unloading the grain? 

By virtue of the inspection reports issued by the Duluth Board of 

Trade, it is apparent the shipments arrived in good order at the place 

designated by the bills of lading, the siding at Capital. While there are 

no Montana cases directly in point, there are numerous decisions from other 

jurisdictions holding that the carrier is absolved from responsibility for 

unloading bulk commodities in carload lots when the car or cars are del ivered 

to the consignee. 

In Republic Carloading & Distributing Co. v. Missouri Pacific R. Co., 

302 F.2d 381, 386, the court said: 

"Common carrier 1 iabil i ty ceases upon del ivery of the 

shipment to the consignee. Delivery of a carload shipment, 

such as is involved in this category, - - is normally effected 

when the car is placed on a team track or ~potted.'~ 

(Emphasis suppl i ed . ) 

In Jones v. Thompson, 360 Mo. 285, 228 S.W.2d 673, 676, the court 

said: 
"The general rule, at least as to dead freight, is that 

the carrier is primarily bound both to load and unload 

in a proper manner freight delivered to it for transportation. And for breach of that duty resulting in 

damage it will generally be liable. But by custom or 

usage an exception generally obtains in the case of bulky 

freight in carload lots. * * * Thereunder the carrier is 

not required to unload such freight from the car." 

(Emphasis added. ) 

Respondent Eisenman urges that Milwaukee has not carried its burden 

of proof citing Joseph Toker Co. v. Lehigh Valley R. Co., 12 N.J. 608, 97 

A.2d 598, 599. Here, the documentary evidence, uncontradicted, was that 

the shipments arrived in good order. Thus, Milwaukee did carry its burden 

of proof. 

Clearly, on the basis of the shipments involved being bulk shipments in carload lots, it is apparent the duty to unload was not that of the 

railroad, but rather that of Capital. However, there is a second basis upon 

which the burden to unload is placed upon the consignee. The cars were 

placed upon a private siding at Capital. 13 C.J.S. Carriers s 67, p. 124, 

states : 

"The general rule requiring the carrier to load and unload 

shipments is also not applicable to a case where the cars 

are not to be loaded or unloaded at the station or on the 

lands and tracks of the carrier. Where cars are delivered 

on a private siding off the land of the carrier, it is 

under no obl igation to unload them. I' (Emphasis added. ) 

In Secretary of Agriculture v. United States, 347 U.S. 645, 74 S.Ct. 

826, 98 L.ed 1015, 1020, the Court said: 

"In the case of private sidings, the railroad's job 

ends when it has placed the car on the consignee's 

siding." (Emphasis added.) 

Milwaukee had neither the equipment nor the facilities at Duluth to 

unload grain. The cars were spotted at Capital's siding for the consignee 

to handle from then on. The railroad's duty ended there. Thereafter, the 

employees or agents of Capital unloaded the grain and, in so doing, left 

a considerable amount of grain in the cars. According to the testimony of 

Mr. Eisenman, not all of his grain was unloaded and he suffered a loss as 

a result. That loss was directly and proximately caused by the actions 
and derelictions of Capital, and not by any act or omission on the part of 

Milwaukee. 

The evidence presented did not support the trial court's finding 

that the loss of grain was caused by Milwaukee. 

Therefore, the judgment of the district court is reversed and 

this cause is remanded with instructions to enter judgment in favor of def endant. 

Mr. Justice John Conway Harrison dissenting: 0 

I dissent.