Court Opinion

ID: 3972904
Source: CourtListenerOpinion
Date Created: 2016-07-06 10:31:17.615394+00
Date Added: 2024-06-11T14:17:53.995583
License: Public Domain

No complaint has been made by the appellee of the judgment rendered in this court upon the original hearing, and the only questions to be now considered are those presented in the motion for a rehearing by the Missouri Kansas  Texas Railway Company of Texas, who, for convenience, will be hereinafter referred to as the appellant.
The material facts have been very clearly stated by Chief Justice WILLSON in his original opinion. I differ with my Associates only as to the legal conclusions that should be drawn from those facts. Since it has been determined that neither the pleadings of the appellee nor the facts as found by the court warrant the conclusion that the conduct of the agent of the appellant had been ratified by an effort on the part of the appellant to transport the car of corn to Plano, I am of the opinion that the judgment as to that company should be reversed. As we now view the record, the liability of the appellant *Page 837 
depends upon its being estopped to repudiate the action of its agent in issuing the supplemental bill of lading referred to at the instance of the Walker Grain Company. We know judicially that the Missouri, Kansas Texas Railway Company and the Missouri Kansas  Texas Railway Company of Texas, the appellant in this suit, are two separate and distinct railway corporations, the latter operating in Texas, and the former outside of this state; that they are parts of a great railway system engaged in interstate commerce, and connect with each other at Red River, a few miles north of the city of Sherman. We also know judicially that the Houston  Texas Central Railway Company operates a line of railroad through Plano, but that Plano is not touched by the appellant's line.
After alleging the issuance of the original bill of lading by the Chicago  Great Western Railway Company routing the car of corn involved in this suit over the Missouri, Kansas  Texas Railway system, the appellee pleads as follows:
"That the defendant Missouri, Kansas  Texas Railway Company of Texas accepted the terms and conditions of said contract so made by the defendant Walker Grain Company with this plaintiff, and agreed to participate therein by transporting over its line of road the said car of corn from Red river on the northern boundary line of Texas to Sherman, Tex., and thence on to Plano, Tex., over the line of the defendant Houston  Texas Central Railroad Company; that the defendant Missouri, Kansas  Texas Railway Company of Texas accepted and retained the said bill of lading so delivered to it by the defendant Walker Grain Company, and did issue and deliver to defendant Walker Grain Company another bill of lading in lieu thereof and as an amendment thereto, by which the defendant Missouri, Kansas  Texas Railway Company of Texas acknowledged that the said car of corn was in its possession and under its control at the time, and by which bill of lading it agreed to transport the said car of corn from its northern terminus, Red river, to Sherman, Tex., and thence on to Piano, Tex., and there deliver it to the defendant Walker Grain Company, or its assigns, under the said bill of lading. That the said supplemental bill of lading so issued by the defendant Missouri, Kansas  Texas Railway Company of Texas was likewise a negotiable instrument, and the same was by the defendant Missouri, Kansas  Texas Railway Company of Texas placed in the hands of the defendant Walker Grain Company and made subject to being negotiated by it."
It is not alleged that the car of corn was ever in the possession of this appellant, and the court finds as a fact that it was not. As ground for recovering against the appellant the appellee alleges as follows:
"That by reason of the defendant Missouri, Kansas  Texas Railway Company of Texas having issued its supplemental bill of lading covering said car of corn, and having delivered the said supplemental bill of lading, which was a negotiable instrument, to the Walker Grain Company, the said defendant Missouri, Kansas  Texas Railway Company of Texas did thereby assist and enable the defendant Walker Grain Company to collect from this plaintiff the price of said corn, to wit, the sum of $974.83, and did enable the defendant Houston  Texas Central Railroad Company to collect from this plaintiff said freight amounting to $197.42; and the said defendant Missouri, Kansas  Texas Railway Company of Texas is therefore estopped to now assert that it never received the said car of corn, and that it never had the same in its possession, and that by reason of its failure to deliver the said car of corn according to the terms of its said supplemental bill of lading to this plaintiff it thereby became and is now liable to this plaintiff for the amount of its loss and damage, to wit, $1,172.25."
It is thus made to appear that the only ground for holding the appellant liable in this suit is that it is estopped to now repudiate the action of its agent in issuing the supplemental bill of lading and deny that it ever had possession of the car of corn.
It is clear that if this supplemental bill of lading had never been issued, the only material facts being the same, there could be no pretense for holding the appellant liable in this suit. It had nothing to do with the issuance of the original bill of lading by the Chicago 
Great Western Railroad Company, or with the change in the routing thereafter made, and therefore owed no duty toward the shipment, contractual or otherwise. Hunter v. Southern Pine Lumber Co., 76 Tex. 195,13 S.W. 190; 4 Elliott on Railroads, § 1433. The controlling question, then, is, Do the facts show conditions which should estop it from interposing the defense that the car of corn was never in its possession and that the supplemental bill of lading was issued without authority by its agent? A bill of lading is construed to be both a receipt for the goods described in it and a contract of carriage. Cohen Bros. v. M., K.  T. Ry. Co., 44 Tex. Civ. App. 381, 98 S.W. 437; G., C.  S. F. Ry. Co. v. Lowery, 155 S.W. 992. As a receipt it is prima facie, but not conclusive, evidence of what it recites. While some courts have held that when a bill of lading passes into the hands of an innocent holder the issuing carrier is estopped to deny that it had received the goods and thus escape the consequence of damages of delay, the great weight of authority in this country is to the contrary. Friedlander v. Texas, 130 U.S. 424, 9 S. Ct. 570, 32 L. Ed. 994; The Carlos F. Roses, 177 U.S. 665, 20 S. Ct. 803, 44 L. Ed. 933; 4 Elliott on Railroads, §§ 1418, 1419; 1 Hutchinson on Carriers, §§ 160, 161. An ordinary bill of lading is not negotiable in the sense in which that term is applied to commercial paper, such as notes and bills of *Page 838 
exchange. 1 Hutchinson on Carriers, § 175. It is assignable only, and its assignment is accompanied with all of the conditions common to nonnegotiable instruments under the law merchant. Therefore the appellant had a right to plead any defense against the appellee which it might have urged had this suit been prosecuted by the Walker Grain Company, the original holder of the bill of lading, and who was familiar with all of the facts attending its issuance. Our statute seems to recognize the nonnegotiability of ordinary bills of lading in providing a method by which they may be certified and validated so as to be conclusive in the hands of third parties. Articles 715, 719, and 724, Rev.Civ.Stat. This bill of lading had not been certified or validated in the manner pointed out in these articles. But it is said that the appellant cannot in this suit avail itself of that defense, because it did not plead a mistake in issuing the supplemental bill of lading. This is not a case in which that rule of pleading is applicable. The agent who issued this bill of lading knew that the goods were not in the possession of the railroad company for which he acted; and the Walker Grain Company, to whom it was issued, was also cognizant of that fact. There can therefore be no mistake in a transaction where the parties did the thing they intended to do. But if it should be held otherwise, the appellant did plead that the bill of lading was issued without authority because the goods described in it were not in fact received by it at the time the instrument was issued, or any time thereafter. Furthermore, the pleadings of the appellee state facts which clearly show that the bill of lading was issued by the appellant's agent upon the mere presentation of the original bill of lading issued by the Chicago  Great Western Railroad Company and while the goods were in transit over another route. There was therefore no occasion for the appellant to plead facts which had been sufficiently stated in the plaintiff's pleadings.
It has been held by one of our Courts of Civil Appeals that a defense of this character may be interposed on a general denial. Cohen v. M., K. T. Ry. Co., supra. If the appellant may show that it did not receive the goods and that the bill of lading was issued without authority, the entire instrument is a nullity, and cannot be invoked for the purpose of holding the appellant liable for the failure to transport the goods to Plano. It is no argument to say that appellant's agent did have authority to make a contract binding his principal to receive the goods when tendered by its connecting carrier and transport them to Plano, for that contingency never happened, and that portion of the contract, if valid, never took effect. I am therefore of the opinion that the judgment in this case as to the appellant should be reversed and rendered.