Court Opinion

ID: 9833702
Source: CourtListenerOpinion
Date Created: 2023-09-01 22:57:25.064588+00
Date Added: 2024-06-11T07:44:06.008423
License: Public Domain

On Motion for Rehearing.
[2, 3] We agree that since Congress has taken possession of the subject of common ■carriers in matters of interstate shipment, the United States statutes and the decisions of the federal courts should control in regard to the interpretation of shipping contracts and application of the rules of law to ■cases arising upon interstate contracts, but we do not agree that.the tendency of the federal courts and the great weight of authority ■of other courts is in favor of the validity and reasonableness, under all circumstances, of the stipulation contained in this contract, with reference to giving notice of damages before the stock are removed from the point •of shipment, etc. In our opinion, Clegg v. St. Louis & San Francisco Ry. Co., 203 Fed. 971, 122 C. C. A. 273, and the Metropolitan Trust Co. v. Toledo, St. L. & K. C. R. Co. (C. C.) 107 Fed. 628, do not hold that such a stipulation is reasonable, under any and all circumstances, and we think it would be a dangerous precedent for the courts to establish any such doctrine. So far as we have been able to find, the Supreme Court of the United States has never passed directly upon the question here presented. The Clegg Case shows that the validity of the agreement to give the notice was sustained upon consideration of the fact that the shipper had received a lower freight rate than was usually granted shippers. No such fact was set up by the appellant in this case. It is true that the opinion declares the provision in the contract, with reference to notice, to be valid, and states that a failure to give the notice is fatal to plaintiff’s right to recover. In the case of Metropolitan Trust Co. v. Railway Co. (C. C.) 107 Fed. 628, it was simply held that the failure of the shipper to give notice of his claim for damages within the 30 day period provided in the contract was a reasonable requirement; and Pac. S. S. Co. v. Baneroft W. Co., 94 Fed. 180, 36 C. C. A. 135, holds such requirement unreasonable as a matter of law. A case could rarely ever arise where the damages sustained by the shipper could not be ascertained with reasonable certainty within 30 days from the time the shipment reached its destination; and the contracts in those cases are so different from the one now under consideration as to render the cases themselves inapplicable here. The case of Kidwell v. Oregon Short Line Ry. Co., 208 Fed. p. 1, 125 C. C. A. 313, involved the same question which we are now considering; and, while the stipulation was held to be reasonable in that case, it is dear that the federal court based the holding upon the fact that the Supreme Court of Oregon had previously announced such a rule. That the stipulation might be or become unreasonable is clearly recognized in the Kidwell Case, by this language, found in the opinion:
“There was nothing in the circumstances, as disclosed by the record in the case at bar, to render the requirement of the notice negligible or impracticable, as in the case of C. R. I. & P. Ry. Co. v. Spears, 31 Okl. 469 [122 Pac. 228].”
We must infer from this language that the validity of the notice and its binding effect might have, under favorable circumstances, been declared by the federal court to be unreasonable. In Ormsby v. Union Pacific Ry. Co. (C. C.) 4 Fed. page 170, it is said:
“As to the last clause of the answer [of the appellee], which may be taken to be an independent answer in itself, that sets up a provision in the contract that for injuries to the animals shipped over the line of the road the owner should make a demand in writing on the agent of the company before removing- them from the place of destination, or from the place of delivery. It may be that for some injuries this clause in the agreement would be effectual; but here, according to the charge of the complaint, the injury was illness of the animals, which could hardly be discovered until they *545should he removed from the car; and this clause in the contract would require the parties to hold them at the depot grounds, I suppose, until they could ascertain whether they were in good condition or not. That would be very unreasonable indeed. As to such matters as are charged in the complaint— an illness occurring to animals, the extent of which, could not be known until they should be removed from the car, and probably not for some little time after their arrival here — it may be said that this clause in the agreement is of no effect; that the railroad company could not make any such provision in respect to stock shipped over their line. The demurrer will be sustained to the last clause or paragraph, or whatever it may be called, of the answer, and overruled to the other.”
It seems that this is the only clear enunciation by any federal court touching the question under consideration. The state courts differ materially upon this question, but the rule is settled in Texas, by Missouri Pacific Railway Co. v. Harris, 67 Tex. 166, 2 S. W. 574, and other subsequent cases. We think, in the absence of a definite holding by the Supreme Court of the United States to the contrary, we should adhere to the rule governing such stipulations as announced by Judge Stay ton, in the Harris Case, as follows:
“The answer must present a defense to the case made by the petition. If the answer does not show that, under the facts existing, the limitation on the carrier’s liability sought to be imposed by the special contracts was reasonable in its character, then the answer was not sufficient, and the court below properly sustained the demurrer. If a carrier sets up a claim to notice of a given fact, as a condition upon which its liability to a shipper is to depend, then it is incumbent upon it, when the notice was to be given to one of its own officers or agents, to show that it had an officer or agent at or near the place where the notice is to be given, in any case in which the shipper, by the terms of the contract through which notice is claimed, is to hold the property shipped at the place of delivery * * until it can be inspected by some agent of the carrier. This would be especially true when the property to be inspected is intended for immediate sale at the place of destination, is perishable in character, likely to deteriorate in value by holding, and expensive to keep. If in such case the carrier has not an officer or agent at or near the place where the property to be inspected is delivered, so that notice may be promptly given and an inspection, if desired, speedily made, then a contract requiring notice to be given to an officer or agent of the carrier is not reasonable in its character. The contract to give notice was not the entire contract; the notice was required to be given to an officer or the nearest station agent of the carrier, and the situation of such officer or agent, with reference to the place from which the notice must necessarily come, and at which an inspection, if desired, would necessarily have to be made, would largely determine whether the contract was reasonable or not. The answer should have shown that the carrier had an officer or agent so situated that the contract to give notice to such officer or agent was reasonable. Under the averments of the petitioner, the place of delivery was beyond the line of appellant’s railway, in another state, and no presumption can arise that the carrier had an officer or station agent near the place of destination. If the contract were even valid, whether reasonable or not, the shipper would be bound by its terms; but where its validity depends upon its being reasonable, the party who asserts its validity must allege the facts which make it so. It may well be doubted if such a contract as is relied on in this case ought ever to be sustained. If a carrier seeks to make its liability depend on notice to its officer or agent of a claim for damages, it would seem that the responsibility of determining who is an officer or agent of a carrier, within the meaning of the contract, should not be cast upon the shipper, but that the person and his locality to whom the notice must be given ought to be made certain by the contract itself, and especially so when the carrier is a corporation and the property is to be delivered beyond the line of its road through another carrier. We are of the opinion that there was no error in sustaining the demurrers to the answers setting up the defenses we have noticed.”
We think the law applicable to stipulations of this character is correctly stated in 4 R. 0. L., Carriers, p. 795, § 253:
“The one essential of stipulations of this nature is that they be reasonable; that is, however, purely relative, and a stipulation perfectly reasonable under one state of facts would be quite unreasonable under another. Whether in any particular case the stipulation under consideration is valid is therefore dependent on the peculiar facts and circumstances of that case, the chief _ query being whether sufficient time has been given to enable the shipper to discover the loss and give notice thereof, this again being largely dependent on distances and the facilities of communication. From the very nature of such a requirement, it is evident that no helpful general rule can be laid down. * * * Where the damage done is not for any reason apparent or capable of being estimated within the time provided for giving notice, it seems that the provision for notice will be held unreasonable, as a carrier cannot reasonably require that the shipper shall give notice of a claim- for damages before the injury, or its extent, can be discovered by the latter in the exercise of due diligence.”
The motion is overruled.
HENDRICKS, J., dissents for the reasons stated in his opinion filed in the case of C., R. I. & G. Ry. Co. v. Dalton, 177 S. W. 556.