Source: https://caselaw.findlaw.com/us-supreme-court/219/186.html
Timestamp: 2019-04-26 07:09:09+00:00

Document:
[219 U.S. 186, 187] This was an action to recover the value of goods received by the Atlantic Coast Line Railroad at a point on its line in the state of Georgia for transportation to points in other states. The agreed statement of facts showed that the goods were safely delivered by the Atlantic Coast Line Railroad to connecting carriers, and were lost while in the care of such carriers, and the question is whether the initial carrier is liable for such loss.
The stipulated facts showed that the goods were tendered to the Atlantic Coast Line Railroad, and through bills of lading demanded therefor, which were duly issued, as averred, on the dates named in the petition. That the goods so received were forwarded over the lines of the receiving road and in due course delivered to a connecting carrier engaged in interstate shipment for continuance of the transportation. It was also stipulated 'that the Riverside Mill made constant and frequent shipments over the Atlantic Coast Line, and had a blank form of receipt, like the attached, marked 'A,' which the [219 U.S. 186, 188] Riverside Mill filled out, showing what goods it had loaded into cars, and the name of the consignee; said receipt containing a stipulation that the shipment is 'per conditions of the company's bill of lading,' and that the Atlantic Coast Line Railroad Company, on said receipts prepared by the Riverside Mill, issued, for each of the shipments hereinbefore referred to, bills, of lading on forms like that attached, marked exhibit 'B."
[219 U.S. 186, 192] Assistant to the Attorney General Kenyon, Attorney General Wickersham, John Maynard Harlan, and Lewis W. McCandless as amici curice. [219 U.S. 186, 193] Messrs. Alexander Akerman, Charles Akerman, and R. J. Southall for defendant in error.
Independently of the Carmack amendment the carrier, when tendered property for such transportation, might elect to contract to carry to destination, in which case it necessarily agreed to do so through the agency of other and independent carriers in the line; or, it might elect to carry safely over its own lines only, and then deliver to the next carrier, who would then become the agent of the shipper. In the first case the receiving carrier's liability as carrier extends over the whole route, for, on obvious grounds, the principal is liable for the acts of its agent. In the other case its carrier liability ends at its own terminal, and its further liability is merely that of a forwarder. Having this power to make the one or the [219 U.S. 186, 197] other contract, the only question which has occasioned a conflict in the decided cases was whether it, in the particular case, made the one or the other.
The general doctrine accepted by this court, in the absence of legislation, is, that a carrier, unless there be a special contract, is only bound to carry over its own line, and then deliver to a connecting carrier. That such an initial carrier might contract to carry over the whole route was never doubted. It is equally indisputable that if it does so contract, its common-law carrier liability will extend over the entire route. Ohio & M. R. Co. v. McCarthy, 96 U.S. 258, 266 , 24 S. L. ed. 693, 696; Ogdensburg & L. C. R. Co. v. Pratt, supra; Northern P. R. Co. v. American Trading Co. 195 U.S. 439 , 49 L. ed. 269, 25 Sup. Ct. Rep. 84; Muschamp v. Lancaster & P. R. Co. 8 Mees. & W. 421.
The English cases beginning with Muschamp v. Lancaster & P. R. Co. supra, decided in 1841, down to Bristol & E. R. Co. v. Collins, 7 H. L. Cas. 194, have consistently held that the mere receipt of property for transportation to a point beyond the line of the receiving carrier, without any qualifying agreement, justified an inference of an agreement for through transportation, and an assumption of full carrier liability by the primary carrier. The ruling is grounded upon considerations of public policy and public convenience, and classes the receipt of goods so designated for a point beyond the carrier line as a holding out to the public that the carrier has made its own arrangements for the continuance by a connecting carrier of the transportation after the goods leave its own line. There are American cases which take the same view of the question of evidence thus presented. Some of them are Louisville & N. R. Co. v. Campbell, 7 Heisk. 257, Alabama & G. S. R. Co. v. Mt. Vernon Co. 84 Ala. 175, 4 So. 356; Central R. Co. v. Hasselkus, 91 Ga. 384, 44 Am. St. Rep. 37, 17 S. E. 838; Beard v. St. Louis, A. & T. H. R. Co. 79 Iowa, 531, 44 N. W. 803; Kyle v. Laurens R. Co. 10 Rich. L. 382, 70 Am. Dec. 231; Erie R. Co. v. Wilcox, 84 Ill. 240, 25 Am. Rep. 451; East Tennessee & V. R. Co. v. Rogers, 6 Heisk. 143, 19 Am. Rep. 589. [219 U.S. 186, 198] Upon the other hand, many American courts have repudiated the English rule which holds the carrier to a contract for transportation over the whole route, in the absence of a contract clearly otherwise, and have adopted the rule that unless the carrier specifically agrees to carry over the whole route, its responsibility as a carrier ends with its own line; and that, for the eontinuance of the shipment, its liability is only that of a forwarder. The conflict has therefore been one as to the evidence from which a contract for through carriage to a place beyond the line of the receiving carrier might be inferred.
Along with this singleness of rate and continuity of carriage there grew up the practice by receiving carriers, illustrated in this case, of refusing to make a specific agreement to transport to points beyond its own line, whereby the connecting carrier, for the purpose of carriage, would become the agent of the primary carrier. The common form of receipt, as the court may judicially know, is one by which the shipper is compelled to make with each carrier in the route over which his package [219 U.S. 186, 200] must go a separate agreement limiting the carrier liability of each separate company to its own part of the through route. As a result the shipper could look only to the initial carrier for recompense for loss, damage, or delay occurring on its part of the route. If such primary carrier was able to show a delivery to the rails of the next succeeding carrier, although the packages might and usually did continue the journey in the same car in which they had been originally loaded, the shipper must fail in his suit. He might, it is true, then bring his action against the carrier so shown to have next received the shipment. But here, in turn, he might be met by proof of safe delivery to a third separate carrier. In short, as the shipper was not himself in possession of the information as to when and where his property had been lost or damaged, and had no access to the records of the connecting carriers who, in turn, had participated in some part of the transportation, he was compelled in many instances to make such settlement as should be proposed.
It must be conceded that the effect of the act in respect of carriers receiving packages in one state for a point in another, and beyond its own lines, is to deny to such an initial carrier the former right to make a contract limiting liability to its own line. This, it is said, is a denial of the liberty of contract secured by the 5th Amendment to the Constitution. To support this, counsel cited such cases as Allgeyer v. Louisiana, 165 U.S. 589 , 41 L. ed. 835, 17 Sup. Ct. Rep. 427; Lochner v. New York, 198 U.S. 45 , 49 L. ed. 937, 25 Sup. Ct. Rep. 539, 3 A. & E. Ann. Cas. 1133; and Adair v. United States, 208 U.S. 161 , 52 L. ed. 436, 28 Sup. Ct. Rep. 277, 13 A. & E. Ann. Cas. 764.
This power to regulate is the right to prescribe the rules under which such commerce may be conducted. 'It is,' said Chief Justice Marshall, in Gibbons v. Ogden, 9 Wheat. 1, 196, 6 L. ed. 23, 70, 'the power . . . vested in Congress as absolutely as it would be in a single government having in its Constitution the same restrictions on the exercise of the power as are found in the Constitution of the United States.' It is a power which extends to the regulation of the appliances and machinery and agencies by which such commerce is conducted. Thus, in Johnson v. Southern P. Co. 196 U.S. 1 , 49 L. ed. 363, 25 Sup. Ct. Rep. 158, an act prescribing safety appliances [219 U.S. 186, 202] was upheld. And in Interstate Commerce Commission v. Illinois C. R. Co. 215 U.S. 452 , 54 L. ed. 280, 30 Sup. Ct. Rep. 155, it was held that the equipment of an interstate railway, including cars used for the transportation of its own fuel, was subject to the regulation of Congress. In Interstate Commerce Commission v. Chicago & A. R. Co. 215 U.S. 479 , 54 L. ed. 291, 30 Sup. Ct. Rep. 163, it was held to extend to the distribution of coal cars to the shipper, so as to prevent discrimination. In the Employers' Liability Cases (Howard v. Illinois C. R. Co.) 207 U.S. 463 , 52 L. ed. 297, 28 Sup. Ct. Rep. 141, power to pass an act which regulated the relation of master and servant, so as to impose on the carrier, while engaged in interstate commerce, liability for the negligence of a fellow servant, for which at common law there was no liability, and depriving such carrier of the common-law defense of contributory negligence save by way of reduction of damages, was upheld. In Addyston Pipe & Steel Co. v. United States, 175 U.S. 211 , 44 L. ed. 136, 20 Sup. Ct. Rep. 96, and Northern Securities Co. v. United ed States, 193 U.S. 197 , 48 L. ed. 679, 24 Sup. Ct. Rep. 436, it was held that this power of regulation extended to and embraced contracts in restraint of trade between the states.
That a situation had come about which demanded regulation in the public interest was the judgment of Congress. The requirement that carriers who undertook to engage in interstate transportation, and as a part of that business held themselves out as receiving packages destined to places beyond their own terminal, should be required, as a condition of continuing in that traffic, to obligate themselves to carry to the point of destination, using the lines of connecting carriers as their own agencies, was not beyond the scope of the power of regulation. The rule is adapted to secure the rights of the shipper by securing unity of transportation with unity of responsibility. The regulation is one which also facilitates the remedy of one who sustains a loss, by localizing the responsible carrier. Neither does the regulation impose an unreasonable burden upon the receiving carrier. The methods in vogue, as the court may judicially know, embrace not only the voluntary arrangement of through routes and rates, but the collection of the single charge made by the carrier at one or the other end of the route. This involves frequent and prompt settlement of traffic [219 U.S. 186, 204] balances. The routing in a measure depends upon the certainty and promptness of such traffic balance settlements, and such balances have been regarded as debts of a preferred character when there is a receivership. Again, the business association of such carriers affords to each facilities for locating primary responsibility as between themselves which the shipper cannot have. These well-known conditions afford a reasonable security to the receiving carrier for a reimbursement of a carrier liability which should fall upon one of the connecting carriers as between themselves.
But it is said that any security resulting from a voluntary agreement constituting a through route and rate is destroyed if the receiving carrier is not at liberty to select his own agencies for a continuance of the transportation beyond his own line. This is an objection which has no application to the present case. This action was for loss and damage arising from several distinct shipments to different places beyond the line of the plaintiff in error, who was the initial or receiving carrier. The presumption, from the absence of anything to the contrary in the record, is that the routing was over connecting lines with whom the plaintiff in error had theretofore made its own arrangements and rate. This record presents no question as to the right of the initial carrier to refuse a shipment designated for a point beyond its own line, nor its right to refuse to make a through route or joint rate when such route and rate would involve the continuance of a transportation over independent lines. We therefore refrain from any consideration of the large question thus suggested. The shipments involved in the present case were voluntarily received by an initial carrier who undertook to escape carrier's liability beyond its own line by a provision limiting liability to loss upon its own line. This was forbidden by the Carmack amendment, and any stipulation and condition in the [219 U.S. 186, 205] special receipt which contravenes the rule in question is invalid.
'Unless the regulations are so utterly unreasonable and extravagant in their nature and purpose that the property and personal rights of the citizen are unnecessarily, and in a manner wholly arbitrary, interfered with or destroyed without due process of law, they do not extend beyond the power of the state to pass, and they form no subject for Federal interference. As stated in Crowley v. Christensen, 137 U.S. 86 , 34 L. ed. 620, 11 Sup. Ct. Rep. 13: 'The possession and enjoyment of all rights are subject to such reasonable conditions as may be deemed by the governing authority of the country essential to the safety, health, peace, good order, and morals of the community."
In substance Congress has said to such carriers: 'If you receive articles for transportation from a point in one state to a place in another, beyond your own terminal, you must do so under a contract to transport to the place designated. If you are obliged to use the services of independent carriers in the continuance of the transit, you must use them as your own agents, and not as agents of the shipper.' It is therefore not the case of making one pay the debt of another. The receiving [219 U.S. 186, 207] carrier is, as principal, liable not only for its own negligence, but for that of any agency it may use, although, as between themselves, the company actually causing the loss may be primarily liable.

References: v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 V. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v.