Opinion ID: 215096
Heading Depth: 1
Heading Rank: 3

Heading: Replacement Value of Household Goods

Text: On summary judgment, the district court held that Atlas was liable to both Pacific and Pickens for $52,500.00 or $5.00 per pound, and that Pickens was liable to Pacific for $1 million. Pickens does not appeal the assessment of liability itself, rather it argues that the apportionment of the damages was in error. We review the grant of summary judgment de novo. Ventura Packers, Inc. v. F/V JEANINE KATHLEEN, 305 F.3d 913, 916 (9th Cir. 2002). The district court's interpretation of 49 U.S.C. § 14706 is a question of law, which we review de novo. Id. One reason that the district court apportioned the damages as it did was that it construed 49 U.S.C. §§ 14706(f)(2) and (3) to limit Atlas' liability to the tariff amount of $5.00 per pound in the absence of a declared value. We agree. The Carmack Amendment allows carriers to limit their liability for shipments of household goods under certain circumstances. In particular, [u]nless the carrier receives a waiver in writing under paragraph (3), a carrier's maximum liability for household goods that are lost, damaged, destroyed, or otherwise not delivered to the final destination is an amount equal to the replacement value of such goods[.] 49 U.S.C. § 14706(f)(2). However, that subsection goes on to say that the replacement value of such goods [is] subject to a maximum amount equal to the declared value of the shipment and to rules issued by the Surface Transportation Board and applicable tariffs. Id. Here, Pickens failed to declare a value for the shipment. It argues that, in the absence of a written waiver, the failure entitles Pickens to the full replacement value of the shipment. And, it urges that the full replacement value in this case is $1 million. Pickens is partially correct; it is entitled to the replacement value, but that value is $52,500.00. Subsection (f)(2) states that the replacement value of the household goods is subject to or conditioned upon several possible factors. The first is the declared value of the property. Since there is no declared value in this case, that condition is not implicated. Replacement value is also conditioned on the rule issued by the Surface Transportation Board (the Board). The Board has determined that when a shipper elects the [full value protection] option but neglects to write a valuation figure on the bill of lading or contract the carrier is liable for an assumed valuation set at $5,000 or $4.00 [4] times the actual total weight in pounds of the shipment, whichever is greater. Released Rates of Motor Common Carriers of Household Goods, Amendment No. 5 to Released Rates Decision No. MC-999, 2007 WL 1696990 (S.T.B. June 11, 2007) (S.T.B. Amendment 5). In other words, when a shipper does not a declare a value for a shipment, the replacement value is deemed to be $4.00 per pound or a minimum of $5,000.00. Id. Congress gave the Board primary authority for enforcement of the Interstate Commerce Act. Fulfillment Servs., Inc. v. United Parcel Serv., Inc., 528 F.3d 614, 616-17 (9th Cir.2008). Where there is a challenge to the agency's interpretation of the statute that it administers, we apply the analytical framework set forth in Chevron [.] DHX, Inc. v. Surface Transp. Bd., 501 F.3d 1080, 1086 (9th Cir.2007) (internal citation omitted). `If the intent of Congress is clear... [we] must give effect to the unambiguously expressed intent of Congress.' Id. (quoting Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-44, 104 S.Ct. 2778, 2781-82, 81 L.Ed.2d 694 (1984)). If however, the meaning of the statute is ambiguous, `the question for the court is whether the agency's answer is based on a permissible construction of the statute.' Id. (quoting Chevron, 467 U.S. at 843, 104 S.Ct. at 2782). `[T]he court does not simply impose its own construction on the statute....' Id. (quoting Chevron, 467 U.S. at 843, 104 S.Ct. at 2782). Since the statute itself is arguably ambiguous regarding shipments with no declared value, we must ask whether the Board's order was permissible. See id. Reviewing § 14706 as a whole, it is evident that the Board's order regarding undeclared value is permissible. Subsection (f) is entitled  Limiting liability of household goods carriers to declared value. § 14706(f) (emphasis added). The Board's rule does just that. S.T.B. Amendment 5. It prevents carriers from being subjected to unlimited liability when cargo of undeclared value is destroyed. And, it also protects an unwary shipper from unscrupulous carriers by setting the replacement value at the higher tariff amount of $4.00 per pound, [5] instead of the released rate of $.60 per pound. We presume that Congress was aware of the Board's interpretation of the valuation of shipments with an undeclared value when it amended the Carmack Amendment in 2005. Traynor v. Turnage, 485 U.S. 535, 546, 108 S.Ct. 1372, 1380, 99 L.Ed.2d 618 (1988). Congress made no express provision for replacement values of undeclared shipments but instead chose to condition the replacement value on the Board's rules. § 14706(f)(2). The Board's rule is based on a permissible interpretation of subsections (f)(2) and (f)(3). Therefore, it must be accorded deference. DHX, 501 F.3d at 1086. Last, the replacement value is conditioned on applicable tariffs. § 14706(f)(2). The $4.00 per pound tariff was approved by the Board after full notice and comment rule-making. Released Rates of Motor Common Carriers of Household Goods, Amendment No. 4 to Released Rates Decision No. MC-999, 2001 WL 1637941 (S.T.B. Dec. 21, 2001). Atlas adjusts this tariff to $5.00 per pound in its exceptions to tariffs. The fact that this tariff was applicable to shipments with undeclared values was based on the Board's rule discussed above. The plain language of the statute and the Board's interpretation of the statute operate to limit Atlas' liability to the tariff amount on these facts. Pickens argues that the published tariff of $4.00 per pound cannot apply here because subsection (f)(3) states that [t]he released rates ... shall not apply to the transportation of household goods by a carrier unless the liability of the carrier for the full value of such household goods under paragraph (2) is waived, in writing, by the shipper. § 14706(f)(3). But again, without a declared value for the goods, the replacement value is deemed to be the tariff of $4.00 per pound as described above. While Pickens did not waive its entitlement to the full value of such household goods under paragraph (2), because it failed to declare a value for the shipment, the full value is deemed to be the tariff of $4.00 per pound pursuant to paragraph (2) as described above. The district court correctly interpreted these subsections.