CHAPTER VI.

LOSS AND DAMAGE CLAIMS.

$217. Common-Carrier Liability Under the Common Law.

218. Contractual Limitation of Common-Carrier Liability.

219.

Obligations of Carriers for Loss or Damage to Interstate Shipments.

220. Same Subject-Cummins Amendments.

221. Liability of Connecting Carriers.

222. Penalties for Failure to Pay Claims.

223. What is Full Value?

224. Market Value at Destination and How Determined.

225. Claims for Decline in Market Price.

226. Amount of Recovery May Be Limited by Agreement Under Certain Conditions.

227. Liability for Delay in Transit.

228. Statutory Retention of Existing Remedies.

229. Effect of Failure to Issue Bill-of-Lading.

230.

The Bill-of-Lading Contract Ordinarily Binds All Parties.

231. Liability for Freight Charges Under Standard Bills of Lading. 232. Carrier Liable for Execution of Bill-of-Lading Containing Contradictory or Impossible Provisions.

233. Foreign Shipments.

234. Intrastate Shipments.

§ 217. Common-Carrier Liability Under the Common Law. -With respect to the liability of a carrier who exercised "a public employment," and was paid therefor, the rule under the English common law was "The law charges this person thus entrusted to carry goods against all events but acts of God, and of the enemies of the King."250 This is the common-law rule in this country, being stated in a leading case as follows: "The case of a carrier stands upon peculiar grounds. He is responsible as an insurer of the goods, to prevent combinations, chicanery and fraud. '251 The general adoption of this rule makes unnecessary further citation of authorities. The exceptions thereto have been well stated as follows:252

"The contract averred is an unconditional common law

250 Coggs v. Bernard, Court of Queen's Bench (1703), 2 Lord Raymond, 909, 92 Eng. Repr. 107, Bauer and Watkins, Cases on Carriers, 1, 10. 251 Roberts v. Turner (N. Y. 1814), 12 Johns, 232, 7 Am. Dec. 311, Bauer

and Watkins, Cases on Carriers, 14, 15.

252 McCarthy v. L. & N. R. R. Co. (Ala. 1893), 102 Ala. 193, 14 So. 370, 48 Am. St. Rep. 29, Bauer and Watkins, Cases on Carriers, 260, 261.

contract of carriage without reservations or exceptions. By its terms the defendant insured the safe delivery of the goods to the consignee, and assumed liability for any loss or injury resulting from any cause such as afforded the carrier a defense at common law. The strictest proof of all possible care on the part of the carrier in the transportation and delivery of the goods would have been no defense, and, of course, proof of the carrier's negligence was in no wise essential to a recovery. The defenses which a carrier under such a contract may interpose to an action for failure to deliver in good condition are commonly mentioned as two only, namely, that the loss or injury was due either to the act of God, or to the act of a public enemy. But there is, in reality, a third, resting on the fault of the owner of the goods or his agent."

"Act of God" is defined as "something in opposition to the act of man. 11253

-

§ 218. Contractual Limitation of Common-Carrier Liability. That a carrier at common law could, by express contract, limit his liability is a generally-accepted rule. He could, even by general notice brought home to the shipper, limit his liability as an insurer, as well as his liability for the acts of a connecting carrier. It was generally held, however, that a contract relieving the carrier from the consequences of his own negligence was contrary to public policy and void. The courts of the different states did not always agree as to the general rules relating to the extent to which carriers could limit their liability nor as to their application.254 The Supreme Court of the United States announced and followed the rule stated as follows:255

"It is now the settled law that the responsibility of a com

253 Forward v. Pittard, (King's Bench, 1785), 1 T. R. 27, 99 Eng. Repr. 953, 1 Eng. Rul. Cas., 216, Bauer and Watkins, Cases on Carriers, 266, 267.

254 Farmers & M. Bank v. Champlain Tr. Co. (Vt. 1851), 23 Vt. 186, 56 Am. Dec. 68, Bauer and Watkins, Cases on Carriers, 550, et. seq., and cases cited; Hart v. Penn. R. Co.

(1884), 112 U. S. 331, 28 L. Ed. 717, 5 Sup. Ct. 151; American Express Co. v. Daniel (1923), 29 Ga. App. 780, 116 S. E. 660.

255 Express Co. v. Caldwell, 21 Wall. 264, 22 L. Ed. 556, Bauer and Watkins, op. cit. 562, cited in Hart v. Penn. R. Co., 112 U. S. 331, 28 L. Ed. 717, 5 Sup. Ct. 151.

mon carrier may be limited by an express agreement made with his employer at the time of his accepting goods for transportation, provided the limitation be such as the law can recognize as reasonable and not inconsistent with sound public policy."

It is not within the scope of this book to discuss in detail the common-law obligations of carriers as bailees for hire. The foregoing general statements are made for the purpose of introducing a discussion of the regulation by the Congress of these obligations.

§ 219. Obligations of Carriers for Loss or Damage to Interstate Shipments. The carrier's contract to transport in interstate commerce is subject to regulation by the federal government, but, in the absence of congressional action, may be regulated by the states.256 Judge Powell, of the Court of Appeals of Georgia, in an opinion quoted by the Supreme Court of the United States, described this situation in apt language, as follows:257

"Some states allowed carriers to exempt themselves from all or a part of the common-law liability, by rule, regulation, or contract; others did not; the federal courts sitting in the various states were following the local rule, a carrier being held liable in one court when under the same state of facts he would be exempt from liability in another; hence this branch of interstate commerce was being subjected to such a diversity of legislative and judicial holding that it was practically i̇mpossible for a shipper engaged in a business that extended beyond the confines of his own state, or for a carrier whose lines were extensive, to know without considerable investigation and trouble, and even then oftentimes with but little certainty, what would be the carrier's actual responsibility as to goods delivered to it for transportation from one state to another." To meet this situation, Congress enacted what was called the Carmack Amendment,258 which, being a valid law within

256 Penn. R. Co. v. Hughes, 191 U. S. 477, 48 L. Ed. 268, 24 Sup. Ct. 132. 257 So. Pac. Co. v. Crenshaw, 5 Ga. App. 675, 687, 63 S. E. 865, quoted: Adams Ex. Co. v. Croninger, 226 U.

S. 491, 505, 57 L. Ed. 314, 33 Sup.
Ct. 148.

258 See Amendment, changed somewhat by Transportation Act, 1920, Secs. 557, 558, post. Prior to a deci

the power of Congress to enact, superseded all the regulations and policies of the states in so far as they related to interstate commerce. There is, however, a transportation which applies between points both within a state and which can be reached without going out of the state. As to such transportation Congress has not assumed to act, and contracts relating thereto are subject to state laws and regulations.259 Therefore, states may legislate and the state commissions may make regulations relating to a carrier's liability on a contract of shipment in intrastate commerce.200

261

§ 220. Same Subject-Cummins Amendments.-Congress, by what is usually called the first Cummins Amendment," sought further to lessen the exceptions from liability for which the carrier might contract. The Interstate Commerce Commission,262 in construing this amendment, said: "The right of the carrier to initiate its rates and to consider value of the property tendered for transportation as an element in

sion by the Supreme Court the state courts disagreed as to the construction of this amendment. See Post v. Atlantic C. L. R. C., 138 Ga. 763, 76 S. E. 45, citing cases as follows: "On this subject there are two lines of authority. See Adams Ex. Co. v. Millichamp, 138 Ga. 443, 75 S. E. 596; Hooker v. Boston & M. R. Co., 209 Mass. 598, 95 N. E. 945, 23 Ann. Cas. 699, and note; Travis v. Wells, Fargo & Co., 79 N. J. L. 83, 74 Atl. 444; Greenwald v. Weir, 130 N. Y. App. Div. 696, 115 N. Y. Supp. 311; In the matter of Released Rates, 13 I. G. C. 550, 552; Watkins on Shippers and Carriers, 1st Ed., 267, Sec. 201; Galveston, etc., R. Co. v. Wallace, 223 U. S. 481, 491-2, 56 L. Ed. 516, 32 Sup. Ct. 205; St. Louis, etc., R. Co. v. Grayson, 89 Ark. 154, 115 S. W. 933. See also Boston & M. R. Co. v. Hooker, 233 U. S. 97, 58 L. Ed. 808, 34 Sup. Ct. 526, reversing contra-styled case, 209 Mass. 598, 95 N. E. 945, Ann. Cas. 1912B 669; Atchison T. & S. F. R. Co.

V.

v. Robinson, 233 U. S. 173, 58 L. Ed. 90, 34 Sup. Ct. 556, reversing samestyled case, 36 Okla. 435, 129 Pac. 20; Charleston C. R. Co. Varnville Furniture Co., 237 U. S. 597, 59 L. Ed. 1137, 35 Sup. Ct. 715, reversing same-styled case, 98 S. C. 63, 79 S. E. 700; American Brake Shoe & Foundry Co. v. Pere Marquette R. Co., 223 Fed. 1018.

259 Simpson, et al. R. R. Com. of Minnesota v. Shepard, 230 U. S. 352, 57 L. Ed. 1511, 33 Sup. Ct. 729; See also Yazoo & M. V. R. Co. v. Jackson Vinegar Co., 226 U. S. 217, 57 L. Ed. 193, 33 Sup. Ct. 40; Johnson v. So. Ry. Co., 69 S. C. 322, 48 S. E. 260.

260 Atlantic C. L. R. Co. v. Glenn, 239 U. S. 388, 60 L. Ed. 344, 36 Sup. Ct. 154.

261 Secs. 557, 558, post; The Cummins Amendment, 33 I. C. C. 682. 262 The Cummins Amendment, 33 I. C. C. 682, 694.

determining the classification thereof, or the rate applicable thereto, has not been denied by the Act or withdrawn by this amendment." So, while the liability of the carriers was increased, there was a consequent and probably a commensurate increase in the charges. To prevent increases in rates on ordinary live-stock and to avoid the annoyances which passengers had been subjected to with reference to their baggage, Congress passed what has come to be called the Second Cummins Amendment.263 The Carmack and the two Cummins Amendments, in this respect not changed by Transportation Act, 1920, deprive the states of power to regulate a carrier's liability for interstate shipments,26 and leave such liability to be determined by the federal law. The effect of the Amendments is to protect shippers and give a right of recovery "for full actual loss" of goods "at the point of destination at the time they should have been delivered.''265 The 1920 Amendment changes the limitations of time for filing suits, but otherwise substantially follows the Cummins Amendment of 1916. No power of the states over contracts of interstate transportation exists since the Carmack, Cummins and 1920 Amendments, and Congress, by the Bill of Lading Law, has further extended its occupancy of this field.266

By Acts of 1926 and 1927, former laws were further amended. The delivering carrier is now under the same statutory liability as the initial carrier.267

263 Sec. 558, post. Express Rates and Practices, 43 I. C. C. 510; Live Stock Classifications, 47 I. C. C. 335; Williams Co. v. H. C. & N. Y. T. Co., 48 I. C. C., 269; Silk Assn. of Am. v. P. R. R. Co., 44 I. C. C. 578; 50 I C. C. 50.

264 The need for statutes protecting shippers from unjust contracts of common carriers is made apparent by an examination of recent decisions of the Supreme Court: Southern Pac. Co. v. Stewart, 248 U. S. 446, 63 L. Ed. 350, 39 Sup. Ct. 139; Baltimore & O. R. Co. v. Leach, 249 U. S. 217, 63 L. Ed. 570, 39 Sup. Ct. 254; Erie R. Co. v. Shuart, 250 U. S. 465, 63 L. Ed.

1088, 39 Sup. Ct. 519, and cases cited in the opinions.

265 McCaull Dinsmore Co. V. Chicago M. & St. P. Ry. Co., 252 Fed 664, affirmed in 260 Fed. 835, 171 C. C. A. 561; Decker v. M. & St. P. R. Co., 55 I. C. C. 453.

266 Bills of Lading Act, Sec. 560 to 603, post. United States v. Ferger, 250 U. S. 199, 63 L. Ed. 936, 39 Sup. Ct. 445; Bills of Lading, 52 I. C. C. 675; Decker case, Note 265, ante.

267 See Secs. 557, 558 and 559, post, being Sec. 20, par. (11) of the Interstate Commerce Act, and Title 49, Sec. 20, par. (11), p. 75, and historical note pp. 87, U. S. C. A. et