Union Pacific Railroad v. Eyres Transfer & Warehouse Co.

Main, J. This action was brought for the purpose of recovering a charge for freight. The cause was tried to the court and a jury, and resulted in a verdict for the defendant. The plaintiff moved for a judgment notwithstanding the verdict, which was sustained, and from the judgment entered in the sum of $552.51, which included the freight charge and interest thereon, the defendant appealed. The facts are these: The Bestway, Inc., is a corporation with its principal place of business in Los Angeles, California, and it is a shipper of merchandise. It assembles freight of different parties which is consolidated into carload lots and shipped to a designated point, thus reducing the rate to its customers from what it would be if the individual lots were shipped separately. The Eyres Transfer & Warehouse Company is a transfer company, as its name indicates, with its principal place of business in Seattle, this state. The Southern Pacific Railway Company has a line extending from Los Angeles to Portland, in the state of Oregon. The Union Pacific Railroad Company has a line extending from the latter city to Seattle. March 6, 1937, the Bestway company shipped a carload of freight from Los Angeles, the destination of which was Seattle. This car was consigned, by the bill of lading, to the Eyres Transfer & Warehouse Company. It moved over the Southern Pacific as far as Portland; then, the car was transferred to the line of the Union Pacific. It arrived in Seattle, either the *284 evening of the tenth of March, 1937, or sometime during the early morning of the eleventh. The Eyres company was notified of its arrival, and was informed that the car had been billed to it collect. The Eyres company refused to accept the car. Thereafter, and probably during the same day, a telephone conversation took place between the Eyres company and the Bestway company, and a day or two later the Eyres company received a letter from the Bestway company, stating, in part, that the letter was intended to confirm the telephone conversation which the two companies had previously had, and contained this paragraph: “With regards to car GN 43015 now holding, will you ask the Union Pacific to have the carload freight charges collected from us as shippers, this car should have been prepaid.” After the letter was received, the Eyres company, by messenger, sent a copy of the paragraph quoted to the Union Pacific at its offices in Seattle. The Union Pacific informed the Southern Pacific of the situation, and the bill of lading was changed from “collect” to “prepaid.” The freight was delivered to the Eyres company, and was distributed to the various parties, as directed. The Union Pacific thereafter attempted to collect the freight charges from the Bestway company and was unable to do so, apparently because of its insolvency. About two years later, the Union Pacific brought the present action against the Eyres company to collect the freight charge, with the result above stated. It must be remembered that this freight moved in interstate commerce. Chapter one of the Interstate Commerce Act, 49 U. S. C. A. (Sup.), § 3(2), contains a provision that, when a carload of freight is billed to an agent, or someone other than the owner of the *285 freight, as consignee, such consignee can reheve itself from liability for the freight charge, provided that it, “ . . . prior to delivery of the property has notified the delivering carrier in writing of the fact of such agency and absence of beneficial title. . . . ” In the present case, the Eyres company did not, before it received delivery, notify the Union Pacific in writing that it was not the owner of the property, as the statute requires, in order to relieve itself from the obligation to pay the freight charge. The Eyres company’s principal contention is that the Union Pacific, by its conduct, is estopped from maintaining the action. In the case of Pittsburgh etc. R. Co. v. Fink, 250 U. S. 577, 63 L. Ed. 1151, 40 S. Ct. 27, an action was brought to recover from the consignee the balance of a freight charge which was not paid at the time of the delivery of the goods through a mistake of the railroad company as to the amount. The action was sustained, and, with reference to estoppel, it was there said: “Nor can the defendant in error successfully invoke the principle of estoppel against the right to collect the legal rate. Estoppel could not become the means of successfully avoiding the requirement of the act [Interstate Commerce Act] as to equal rates, in violation of the provisions of the statute.” In Louisville & Nashville R. Co. v. Central Iron & Coal Co., 265 U. S. 59, 68 L. Ed. 900, 44 S. Ct. 441, it was held that a consignee, by accepting a shipment, becomes liable, as a matter of law, for the full amount of the tariff charges, whether they are demanded at the time of delivery or later. It was there said: “For, under the rule of the Fink Case, if a shipment is accepted, the consignee becomes hable, as a matter of law, for the full amount of the freight charges, whether they are demanded at the time of delivery, or *286 not until later. His liability satisfies the requirements of the Interstate Commerce Act.” In the case of New York Central & Hudson River R. Co. v. York & Whitney Co., 256 U. S. 406, 65 L. Ed. 1016, 41 S. Ct. 509, by a mistake of the carrier, the charges collected were less than the lawful rates established by the Interstate Commerce Act, and it was held that the consignee was liable for the balance, irrespective of contract and as a matter of law. It was there said: “We think the doctrine announced in Pittsburgh, Cincinnati, Chicago & St. Louis Ry. Co. v. Fink, 250 U. S. 577, (November 10, 1919), is controlling, and that the liability of York & Whitney Company was a question of law. The transaction between the parties amounted to an assumption by the consignee to pay the only lawful rate it had the right to pay or the carrier the right to charge. The consignee could not escape the liability imposed by law through any contract with the carrier.” In the case of Central Warehouse Co. v. Chicago, R. I. & P. R. Co., 20 F. (2d) 828, it was said: “The initial carrier in this case by mistake caused the bill of lading to indicate that the freight charges had been paid by the consignor. The duty imposed upon the carrier by the act applicable to interstate shipments was to collect the lawful rate. This obligation was not only in its own interest, but in the interest of the public. It is not permitted to escape its duty by an oversight and thereby effect a discrimination. It is not within its power to so conduct itself that the plain terms of the statute will amount to nothing. The unintentional act of the carrier does not estop it from demanding payment of the lawful charge.” The cases of Great Northern R. Co. v. Hyder, 279 Fed. 783, Western & Atlantic R. Co. v. Underwood, 281 Fed. 891, and Chicago & Northwestern R. Co. v. J. I. Case Plow Works, 173 Wis. 237, 180 N. W. 846, *287 are to the same effect. In the first of the last three cases cited, it is said: “The shipper, the carrier, and the consignee are all agents and trustees for the public, and no complications arising out of the agreements between them, or shuffling, should defeat the purpose of the act requiring the full and exact payment of the freight as fixed by the filed, posted, and published tariff.” 13 C. J. S. 755, § 316, states the general rule as it appears from the excerpts above quoted, and concludes with the statement that, although the carrier has delayed seeking to enforce the liability of the consignee until after the consignor has become insolvent, it may, nevertheless, maintain the action. It necessarily follows that the Eyres company, not having given written notice that it was not the owner of the freight involved here, as required by the Interstate Commerce Act above referred to, cannot invoke the doctrine of estoppel as against the carrier, or rely upon any agreement that it and the carrier may have made with reference to the collecting of the freight charges from the shipper. The liability of the Eyres company depending upon a question of law, and not upon a question of fact, the superior court did not err in granting the motion for judgment notwithstanding the verdict. The judgment will be affirmed. Robinson, C. J., Millard, Blake, Jeffers, and Driver, JJ., concur.