Court Opinion

ID: 6695226
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:48:15.240529+00
Date Added: 2024-06-11T16:01:12.892856
License: Public Domain

Hoke, J.,
concurring: It is the settled law of this State that, in the absence of legislative sanction, a common carrier, in its contract of shipment, cannot stipulate against recovery for a loss or damage occasioned by its own negligence, and it can make no such stipulation as to either a total or partial loss. Speaking to this question, in Everett v. Railroad, 138 N. C., 71, the Court said: “It is the law of this State, declared by repeated decisions, that common carriers are not permitted to contract against loss occasioned by their own negligence. They can contract neither for total nor for partial exemption from loss so occasioned. Capehart v. Railroad, 81 N. C., 438; Gardner v. Railroad, 127 N. C., 293. The same doctrine is very generally accepted in other jurisdictions. It would be an idle thing for the courts to declare the principle that contracts for total exemption from such loss are subversive of public policy and void, and at the same time permit and uphold a partial limitation which could avail to prevent anything like adequate and substantial recovery by the shipper. Therefore it is held that any limitation of liability by contract designed for the purpose is forbidden.”
*588In the rare and exceptional 'cases when a carrier is allowed, on recovery had for breach of contract of carriage of certain classes of goods, to limit the amount of such recovery to a value fixed and predetermined by the contract of shipment, the rule is, I think, correctly stated in Everett’s case, as follows,: “Such agreements are upheld where, the carrier being without knowledge or notice of the true value, the parties agree upon a valuation of the particular goods shipped, approximating the average value of ordinary goods of like kind, and make such valuation the basis of a just and reasonable .shipping rate.”
This rule is particularly applicable to shipments of stock in quantities, and eminently just to both parties to such contracts, affording to the shipper a fair and reasonable shipping rate and protecting the carrier from exorbitant and unconscionable recoveries by reason of excessive valuations which it had no opportunity to ascertain or to resist successfully, and for which it has received no adequate compensation. But to permit or uphold such a contract, when the loss arises from negligence, all the conditions suggested must exist. The carrier must be without knowledge or notice of the true value; the valuation must be the fair average valuation of property of like kind, and it must have been made the basis of a fair and reasonable shipping rate.
The rule, as stated, is given only by way of suggestion in Everett’s case, supra, but is, I think, the principle to be deduced from many well-considered authorities on the subject, both decisions and approved text writers, some of them referred to in the opinion delivered in that case, among others, Gardner v. Railroad, 121 N. C., 293. In my judgment, the second headnote of Gardner’s case, cited with approval in the principál opinion, as follows: “(2) A common carrier can make a valid agreement, fixing the value of shipments, in case of loss by its negligence, if such agreement be reasonable, or based on a valuable consideration, and it must clearly appear *589that such was the intention of the parties/’ is not a correct digest of the decision rendered by the Court, nor does it correctly express the rule applicable to the case now considered. In the opinion the Court thus refers to the question immediately under discussion: “It is a well-settled rule of law, practically of universal acceptance,, that for reasons of public policy a common carrier is not permitted, even by express stipulation, to exempt itself from loss occasioned by its own negligence. Mitchell v. Railroad, 124 N. C., 236; Mart v. Railroad, 112 U. S., 331; Phœnix Insurance Co. v. Erie & W. Transp. Co., 117 U. S., 322; Liverpool & G. W. Steam Co. v. Phœnix Insurance Co., 129 U. S., 397; California Insurance Co. v. Union Compress Co., 133 U. S., 387, 415; Constable v. Steamship Co., 154 U. S., 51, 62. The measure of such liability is necessarily the amount of the loss; and if a common carrier is permitted to stipulate that it shall be liable only for an amount greatly less than the value of the property so lost — that is, for only a small part of 'the loss — it is thereby exempted pro tanto from the results of its own negligence. Such a course, if- permitted, would practically evade the decisions of the courts and nullify the settled policy of the law. IVe do not mean to say that there are no cases where a common carrier can make a valid agreement as to the value of the article shipped, but all such agreements must be reasonable and based upon a valuable consideration. Moreover, it must clearly appear that such was the intention of the parties,” citing the case of Hinkle v. Railroad, 126 N. C., 932, 938.
It will thus be seen that the decision in Gardner's case was against the claim of exemption from liability for loss occasioned by the carrier’s negligence, and that this second headnote, stated by the reporter as one of the points decided in that case, was only made by way of suggestion and should not be considered as authority for the position stated. On the contrary, it will appear, by careful examination of the *590authorities referred to and others relevant to the subject, that the learned Justice had in mind contracts made by carriers against their common-law liability as insurers — an entirely different proposition — and his statement of such a proposition, in reference to stipulations against negligence, is inaccurate and to some extent misleading. See Hinkle v. Railroad, supra; Capehart v. Railroad, 81 N. C., 438.
The present case comes clearly within the rule stated in' . Everett’s case, supra, and I therefore concur in the decision made, but have deemed it not improper to write a separate opinion, with a view of showing.that the second headnote in Gardner’s case is not a correct digest of that decision and should not be considered as the law applicable to contracts of this character.