Opinion · Supreme Court of the United States

Cau v. Texas & Pacific Railway Co.

Cau v. Tex. & Pac. Ry. Co., 194 U.S. 427 (1904)

Type
Opinion
Court
Supreme Court of the United States
Jurisdiction
Federal
Date
1904-05-16
Topic
general

Mr. Justice McKenna, after stating the case, delivered the opinion-of the court. It is well settled that the carrier may-limit his common law -, liability. York Co. v. Central Railroad, 3 Wall. 107.

Citator

UpLaw has not yet analyzed Cau v. Texas & Pacific Railway Co.. The absence of a flag is not a finding that it is good law.

Cited by
102 opinions

Headnotes

  1. Transportation Law — Limitation of Liability — Common Law Responsibility A common carrier's responsibility is primarily that expressed by the common law, and the shipper may insist upon that responsibility; however, the shipper may consent to a limitation of it, and so long as no stipulation for an exemption is unjust or unreasonable in the eye of the law, the carrier may modify its responsibility by special contract. 194 U.S. at 431
  2. Transportation Law — Limitation of Liability — Option and Opportunity to Ship The "option and opportunity" to which a shipper is entitled consists of the carrier's primary common law responsibility, which the shipper may insist upon or may consent to limit; the carrier need not actually present the shipper with an alternative contract or choice between full and limited liability, nor practice any deceit or take advantage of the shipper, but there can be no limitation of liability without the shipper's assent, and no exemption stipulation that is unjust or unreasonable in the eye of the law. 194 U.S. at 431
  3. Transportation Law — Bills of Lading — Presumed Knowledge of Contents A bill of lading limiting liability constitutes a contract between carrier and shipper, and knowledge of its contents by the shipper will be presumed. 194 U.S. at 431
  4. Transportation Law — Limitation of Liability — Consideration The consideration expressed in a bill of lading is sufficient to support its stipulations exempting the carrier from liability, and no independent consideration apart from that expressed in the bill of lading is required; this effect is not averted by showing that the carrier had only one rate, where that rate was also the rate of all other roads and presumably was adopted and offered in view of the limitation of common law liability. 194 U.S. at 432
  5. Transportation Law — Burden of Proof — Negligence and Excepted Causes Although a carrier cannot contract against the effect of its own negligence, where goods are damaged while in the carrier's custody the burden lies on the carrier to show that the damage was caused by an excepted peril; once that is shown, the burden shifts to the plaintiff to establish that the damage was caused by the carrier's negligence. 194 U.S. at 432
CAUv. TEXAS PACIFIC RY. CO.,194 U.S. 427(1904)
24 S.Ct. 663
CAUv. TEXAS AND PACIFIC RAILWAY COMPANY.
ERROR TO THE CIRCUIT COURT OF APPEALS FOR THE FIFTH CIRCUIT.
No. 57.
Argued April 8, 1904.
Decided May 16, 1904.
While primarily the responsibility of a common carrier is that expressed by the common law and the shipper may insist upon such responsibility, he may consent to a limitation of it, and so long as there is no stipulation for an exemption which is not just and reasonable in the eye of the law the responsibility may be modified by contract. It is not necessary that an alternative contract be presented to the shipper for his choice. A bill of lading is a contract and knowledge of its contents by the shipper will be presumed and a provision therein against liability for damages by fire is not unjust or unreasonable. It is not necessary that there be an independent consideration apart from that expressed in the bill of lading to support a reasonable stipulation of exemption from liability. While the burden may be on the carrier to show that the damage resulted from the excepted cause, after that has been shown the burden is on the plaintiff to show that it occurred by the carrier's own negligence from which it could not be exempted.
THIS is an action to recover the value of cotton delivered by
plaintiff to defendant, to be transported over its railroad from
Texarkana, Texas, to New Orleans. The cotton was destroyed by
fire while in the custody of defendant.
The action was originally brought in the Civil District Court
of the Parish of Orleans and removed on the petition of defendant
to the Circuit Court of the United States for the Eastern
District of Louisiana. The case was tried to a jury,
Page 428
which, under the instructions of the court, rendered a verdict
for defendant, upon which judgment was entered dismissing the
suit with costs. 113 F. 91.
The main question presented by the record is the effect of a
provision in the bills of lading delivered by defendant to
plaintiff, exempting it from liability for damages caused by
fire. Incidentally a question arises as to the burden of proof.
At the time of the delivery of the cotton there were four bills
of lading issued by defendant — three exactly alike and the
fourth substantially like the other three in all that is material
to this case. They all contain the following provision: "That
neither the Texas and Pacific Railway Company nor any connecting
carrier handling said cotton shall be liable for damage to or
destruction of said cotton by fire. . . ."
For the purpose of showing the delivery of the cotton to the
defendant the plaintiff introduced in evidence the bills of
lading, but without prejudice to his claim that the provision
quoted was not binding in the absence of a consideration
therefor. The court admitted the bills of lading, with that
limitation.
The other evidence in the case was that the bills of lading in
blank were obtained from the defendant's agent by plaintiff's
agent, and three of them made out by the latter at his office.
The record leaves doubtful whether the other bill of lading was
prepared by him or by the agent of defendant. The former,
however, testified that the did not know the fire clause was in
the bills of lading, and further testified as follows:
"A. When I applied to the agent of the Texas and Pacific
railroad for a rate to New Orleans on the cotton I was going to
ship he told me I could get but one rate, 60 cents per 100
pounds; that that was the rate of the other roads. And I gave
them the cotton because it was the most direct line to New
Orleans. I simply went there to get the rate, and I simply gave
them the cotton at that rate which they gave me, 60 cents per 100
pounds."
He also testified that he did not want to know the lowest
Page 429
rate; that he asked for the correct rate, he knew there was but
one rate, all of the roads having the same, and that it was
against the law to give other rates.
The following was the testimony as to the fire clause:
"Q. What I mean to say is this: Did you tell the agent of whom
you asked for the rate that you did not want any fire clause in
any bill of lading which he might issue to you? A. No, sir.
"Q. Did you tell him that you wanted to ship your cotton
without any fire clause in the bill of lading? A. No, sir;
because I did not know it was in the bill of lading.
"Q. Therefore you made no application to him then for a rate
based on a bill of lading not containing the fire clause? A. I
made no application that way; I made no inquiries; I just asked
for the rate.
* * * * * * * *
"Q. Allowing that his reply to you was only one rate, was
anything said by him as to the different kinds of contracts you
could get? A. No, sir; he never said anything to me at all.
"Q. Were you or not informed that you could get a contract
under which the company would be liable as insurer, practically,
and another kind of contract, under which they would not be
liable for loss in case of fire? A. No, sir.
"Q. Did you have any information, or did you know that if you
wanted to make a choice between these two that you could do it?
A. No, sir."
The cotton was in the possession of the Union Compress Company
when destroyed to which company it had been delivered by
defendant to be compressed, and that company had obtained
insurance on it for the defendant, it being the custom of that
company to effect insurance for the benefit and in the name of
each particular railroad compressing cotton at their press. The
testimony of the destruction of the cotton is that the Union
Compress Company's building and platforms in Texarkana, Texas,
were destroyed by fire September 19, 1900, in which the cotton
was destroyed with other cotton.
Page 430
Plaintiff requested instructions of the court which embodied
the following propositions:
1. A carrier cannot limit his common law liability without
consent of the shipper for consideration given.
2. The mere contract of shipment is not such a consideration.
3. The condition usually, though not necessarily, is a reduced
rate, but in such case both rates must be offered shipper and be
reasonable, and the shipper given a genuine freedom of choice in
making his selection, and if the evidence satisfied the jury,
"there was no fair alternative or choice offered to plaintiff by
defendant as between two rates, under one of which defendant
would be liable for the loss of said cotton by fire, and under
the other of which he would not be so liable," the fire clause
was not binding upon plaintiff, and the jury might "deal with
such bill of lading as though it did not contain such clause or
stipulation."
4. The burden of proving the reasonableness of the fire
clause, and that plaintiff had a fair opportunity to refuse or
accept it, rested upon the defendant.
Mr. W.S. Parkerson, with whomMr. Branch K. Millerwas on the brief, for plaintiff in error.1Mr. Charles P. Cocke, with whomMr. William Wirt Howe, Mr.John F. DillonandMr. Walter B. Spencerwere on the brief, for defendant in error.
MR. JUSTICE McKENNA, after stating the case, delivered the opinion of the court.
It is well settled that the carrier may limit his common law liability.York Co. v.Central Railroad, 3 Wall. 107. But it is urged that the contract must be upon a consideration other than the mere transportation of the property, and an "optionPage 431and opportunity must be given to the shipper to select under which, the common law or limited liability, he will ship his goods."

If this means that a carrier must take no advantage of the shipper or practice no deceit upon him, we agree. If it means that the alternative must be actually presented to the shipper by the carrier, we cannot agree. From the standpoint of the law the relation between carrier and shipper is simple. Primarily the carrier's responsibility is that expressed in the common law, and the shipper may insist upon the responsibility. But he may consent to a limitation of it, and this is the "option and opportunity" which is offered to him. What other can be necessary? There can be no limitation of liability without the assent of the shipper,New Jersey Steam Navigation Co., v.Merchants' Bank, 6 How. 344, and there can be no stipulation for any exemption by a carrier which is not just and reasonable in the eye of the law.Railroad Co. v.Lockwood, 17 Wall. 357;Bank of Kentuckyv.Adams Express Co.,93 U.S. 174.

Inside of that limitation, the carrier may modify his responsibility by special contract with a shipper. A bill of lading limiting liability constitutes such a contract, and knowledge of the contents by the shipper will be presumed.

(2) It is again urged that there was no independent consideration for the exemption expressed in the bill of lading. This point was made inYork Co. v.Central Railroad, supra. In response it was said: "The second position is answered by the fact, that there is no evidence that a consideration was not given for the stipulation. The company, probably, had rates of charges proportioned to the risks they assumed from the nature of the goods carried, and the exception of losses by fire must necessarily have affected the compensation demanded. Be this as it may, the consideration expressed was sufficient to support the entire contract made."

In other words, the consideration expressed in the bill of lading was sufficient to support its stipulations. This effect is not averted by showing that the defendant had only onePage 432rate. It was the rate also of all other roads, and presumably it was adopted and offered to shippers in view of the limitation of the common law liability of the roads.

(3) The carrier cannot contract against the effect of his negligence, and hence it is contended that in the case at bar the burden of proof is upon the defendant to show that the fire was not caused by its negligence or that of its servants. The contention is answered byClarkv.Barnwell, 12 How. 272. In that case the bill of lading bound the carrier to deliver the goods in like good order in which they were received, dangers and accidents of the seas and navigation excepted. It was held that after the damage to the goods had been established the burden lay upon the carrier to show that it was caused by one of the perils from which the bill of lading exempted the carrier. But it was also held that even if the damage so occurred, yet if it might have been avoided by skill and diligence at the time the carrier was liable. "But," it was observed, "in this stage and posture of the case the burden is upon the plaintiff to establish the negligence as the burden is upon him." The doctrine was affirmed inTransportation Co. v.Downer, 11 Wall. 129. See also section 218, 2 Greenleaf on Evidence.Judgment affirmed.
  1. Page 430 For abstract of argument, which was substantially the same as inCharnockv.Texas Pacific Railway Co., seepost, 433. ↩