Zouch v. Ches. & Ohio R'y Co.

English, J udgb : The question presented for our consideration and determination in this case is whether a railroad company — 529 — operating in this State, and carrying on business as a common carrier, can by a special contract made with a shipper of live stock fix the value of the property to be shipped, and ascertain beforehand the amount of damages that is to be paid in the event of the loss of the property, when the, rates of charges for transportation are fixed by the same agreement in accordance with the value placed by the owner or shipper upon the animal shipped, or whether a shipper has a right to fix one value upon his property at the time he is making the shipment, in order to get the advantage of reduced rates, and place another value upon his property when he claims damages for its loss or destruction. The portion of the agreement signed by the shipper which is materia] in this case reads as follows: “The party of the second part further agrees, for the consideration aforesaid, that he will in no event hold the party of the first part responsible for any loss, damage, or injury whatever to said stock which may occur beyond its own line; and, in case of any loss or damage on its line for which the party of the first part may be responsible under this contract, such responsibility shall be and is hereby limited to one hundred dollars for each horse, * * * * whether such loss or damage exceeds such sum or not.” It appears from the agreed statement of facts, that the freight train, upon which the mare was shipped, went through the Guyandotte bridge across Guyandotte river, and said mare was killed in the wreck between Huntington and Brownstown. Whether tire wreck was the result of inevitable accident or negligence on the part of the defendant does not appear ; but the rule has been laid down, that, where a loss of this character appears, the presumption is that it was caused by negligence, and the burden of proof is on the defendant to show the contrary. For the purposes of this case, then, we will consider it as if the loss of the mare was occasioned by the negligence of the defendant-; and we find that this Court in the case of Maslin v. Railroad Co., 14 W. Va. 180 (second point of syllabus) has held that “a common carrier for hire by special ■ contract based on a valuable consideration may — 530 — exempt itself from loss or damage resulting from inevitable accident, though, such accident was not the result of the act of God or of the public enemy, provided the common carrier or its servants in no manner contributed to such accident; but it can not exempt itself from loss or damage which has in any degree been caused by the negligence or misfeasance of itself or its servauts.” That case was one in which a lot of cattle were shipped over the Baltimore & Ohio Railroad under a special contract, in-which it was provided, that in consideration of a reduced rate of charges the plaintiff assumed certain specified risks ; that is, all and ever’y risk of injuries which the animals or any of them might receive, in consequence of any of them being wild, vicious, unruly, weak, escaping, maiming, or killing themselves or each other, or from delays, or in consequence of beat, suffocation or the ill effects of being crowded on the cars, or on account of being injured by burning of hay or straw or other material used by the owner for feeding them or otherwise, and for any damage occasioned thereby, and also all risk of any loss sustained by reason of any delay, or for other causes or things in or incident to or from or in loading or unloading the cattle. And by said special agreement the plaintiff agreed to load and unload the cattle at his own risk, the defendant to furnish the necessary power to move the cars under the plaintiff’s direction, who was to examine for himself, aud see that they were of sufficient strength, of the right kind, aud in good repair. 'Aud it was further agreed that under no circumstances should the defendant be responsible for injury to or loss of any single animal beyond two hundred dollars, though its value might be more. And the plaintiff or his agent was to have a free passage on the cars, to take care and charge of the cattle, but at his own risk of personal injury from any cause. And the plaintiff'released the defendant from all responsibility fordosses before referred to, or from any other that might happen from mistakes or unavoidable accident in the ^transportation of the cattle. The weather was very warnVjthe cattle were placed in two cars and accompanied by plaintiff’s agent; the cars were delayed, and two cattle — 531 — died on the way from lieat, and others were seriously injured. The facts in the case under consideration are quite different. In this case the plaintiff, for the purpose of getting the benefit of reduced rates of carriage, fixed the value of his marc at one hundred dollars, and paid in consequence three dollars and twenty five cents freight, whereas, if he had placed her at one hundred and seventy five dollars, he would have been required to pay seven dollars ; and he agreed that in case of loss or damage on the defendant’s line, for which said company might be responsible under said contract, it should be limited to one hundred dollars. Row under this contract, if the plaintiff was honest in fixing the value of the mare at one hundred dollars, and agreeing to receive that amount in the case of a loss for which the defendant was legally liable, what unfairness or nnreasonabloss could there be in the contract. If the mare was lost, he would get the value fixed on her by himself; but if he fixed that value below the real value of the mare, for the purpose of enjoying the benefit of the reduced rates, would it be reasonable and right to allow him, when the loss occurs, to put a higher value on her, which he could have done at the time of shipment, and would no doubt have done, if he had not wished to avoid the additional freight charge ? As I understand this contract, it does not exempt the defendant railroad from liability, and such was not the intention of the parties thereto. It merely fixes the amount of liability which will be incurred in the event of loss, by placing a valuation on the property to be handled by the road. In the case of Maslin v. Railroad Co., supra, it will be noticed that the court held that the company could not exempt itself from loss or damage by special contract. It does not, however, hold that the shipper, by special contract with the railroad, can not ascertain and fix the prospective liability of the road in case of loss by fixing a fair and honest valuation on the property. In the case of Hart v. Railroad Co., reported in 112 U. S. 331 (5 Sup. Ct. Rep. 151) will be found a case which bears — 532 — a great similarity to the one at bar. In that case a party shipped five horses and other property by a railroad in one car, and under a bill of lading signed by him, which stated that the horses were to be transported upon the following terms and conditions, which are admitted and accepted by him as just and reasonable : First, to pay freight thereon at a 2’ate specified, “on the condition that the carrier assumes a liability on the stock to the extent of the following agreed valuation : If horses or mules, not exceeding two hundred dollars each ; if a chartered car, on the stock and contents in same one thousand and two hundred dollars for the car load. But no carrier shall be liable for the acts of the animals themselves, nor for loss or damage arising from the condition of the animals themselves, which risk, being béyond the control of the company, are hereby assumed by the owner, and the carrier released therefrom.” By the negligence of the railroad company or its servants, one of the horses was killed and the others were injured, and the other property was lost. In a suit to recover the damages, it appeared that the horses were race horses, and the plaintiff offered to show damages, based on their value, amounting to ' over twenty five thousand dollars. The testimony was excluded, and he had a verdict for one thousand two hundred dollars. On a writ of error brought by him it was held (1) the evidence was not admissible, and the valuation and limitation of liability in the bill of lading were just and reasonable, and binding on the plaintiff; (2) the terms of the limitation covered a loss through negligence. It was also held that “when a contract of carriage signed by the shipper is- fairly made with a railroad company, agreeing on a valuation of the property carried, with the rate of freight based on the condition that the carrier assumes liability only to the extent of the agreed valuation, even in case of loss or damage by the negligence of the carrier the contract will be upheld as a proper and lawful mode of securing due proportion between the amount for which the carrier may be responsible and the freight he receives, and of protecting himself against extravagant and fanciful valuations.” — 533 — In the course of Ms opinion delivered in tliat case, Blatchford, J., says: “This qualification of the liability of tlie carrier is reasonable, and is as important as the rule which it qualifies. There is no justice in allowing the shipper to be paid a large value for an article which he has induced the carrier to take at a low rate of freight on the assertion and agreement that its value is a less sum than that claimed after the loss. It is just to hold the shipper to his agreement, fairly made, as to value, even where the loss or injury has occurred through the negligence of the carrier. The effect of the agreement is to cheapen the freight and secure the carriage, if there is no loss ; and the effect of disregarding the agreement after a loss is to expose the carrier to a greater risk than the parties intended he should assume.” The agreement as to value in this case stands as if the carrier had asked the value of the horses, and had been told by the plaintiff the sum inserted in the contract. See, also, Greenh. Pub. Pol. p. 517, and the numerous authorities there cited in support of this doctrine. Under the strict rules of the common-law the liability of the common carrier is concisely stated by Hutchinson, in his valuable and exhaustive work on Carriers, as follows : “He is an insurer of the goods against all losses except those caused by the act of Cod, the public enemy, the law, the owner, or the inherent nature of the goods.” If we treat the carrier as an insurer, it would surely be unreasonable to allow the shipper, at the time he is insured by placing his horse on the cars, to place one estimate on its value and pay freight in accordance with that estimation, and when a loss occurs to come forward and claim his insurance in the shape of damages by placing another and higher valuation upon the property. If there is any species of property about which men are disposed to differ, and differ honestly, it is in regard to the valuation placed upon horses from causal observation, and the ordinary railroad agent is not presumed to be capable of placing a proper estimate on the value of property of this character, even if he has an opportunity of inspecting it. For this reason, unless some value is allowed to be fixed upon the property — 534 — offered for shipment, the carrier is liable to be subjected to a gross imposition by allowing the owner of a horse, the value of which can only be estimated by thousands of dollars, to avail himself of the advantage of low rates by placing a low estimate on said property, and in the event of a loss to claim and recover the true value. The question of the liability of common carriers under similar circumstances was presented to the court of appeals of Virginia in the case of Railroad Co. v. Payne, 86 Va. 481 (10 S. E. Rep. 749). The rulings of the court in that case clearly draw the distinction between an agreement entered into between a common carrier and a shipper to exempt the carrier from liability for injury or loss occasioned by the neglect or misconduct of such carrier, and a special agreement, in consideration of reduced rate of transportation, to limit his liability to a certain amount less than the value of the property in case of loss or damage occurring through his negligence. ‘In that State there is a statue which provides that “no agreement made by a common carrier for exemption from liability for loss occasioned by his own neglect or misconduct shall be valid.” But said-court, in its opinion, after quoting said statute, says : “But that is not the question before us. The question here is whether, when the shipper signs a bill of lading not exempting the carrier from liability for the negligence of himself or his servants, but limiting the amount in which the carrier shall be liable in consideration of the goods being carried at reduced rates, such a contract, fairly entered into, is valid and binding; and we see no reason why, when its terms are just and reasonable, it should not be. The test to be applied in all such cases is, was the contract fairly entered into, and are its terms just and reasonable ? The contract between the carrier and shipper, in the case at bar, was that in consideration of the freight on said horse being fixed at three dollars and twenty five cents the responsibility of the carrier should be limited to one hundred dollars for the horse, and not that the carrier should be exempted from liability. Now it will be conceded that a common carrier, in receiving property for shipment, is — 535 — entitled to a fair representation from tire shipper as to the value of the property to he shipped, so that, being acquainted with the value of the article intrusted to his care, he may use care and vigilance commensurate with the risk he incurs. So, in the case of Muser v. Express Co., 1 Fed. Rep. 383 (decided by the United States Circuit Court for the southern district of New York) Wallace, J., delivering the opinion, says: “The right of a carrier to exact fair information as to the value of the property confided to his care has always been recognized. He has a right to insist that his compensation be measured by his risk, and obviously the degree of care which lie will exercise will measurably depend upon the extent of the responsibility he may incur,” etc. And in the syllabus the court held that a “stipulation in a receipt limiting the liability of the carrier to a stated sum is binding upon the shipper, in the absence of a disclosure as to the real value of the goods shipped.” It may be noticed here that nothing in the case at bar shows that the defendant had any intimation that the horse shipped by the plaintiff for any reason exceeded in value the sum of one hundred dollars. The Supreme Court of Wisconsin in the case of Black v. Transportation Co. 55 Wis. 319 (13 N. W. Rep. 244) held that “it is well settled that the common carrier of persons or property can not by any agreement, however plain and explicit, wholly relieve itself from liability for injury resulting from its gross negligence or fraud,” and that “it is also settled that in order to exempt the carrier from liability, or to limit the extent of its liability, for injury caused by its own negligence of any kind, the contract must expressly so provide,” and that “a contract providing that in case of loss the carrier shall be liable to pay as damages a specified sum will not, without an express stipulation to that effect, relieve the carrier from liability to the fall amount of the goods lost through its negligence. It is true that the Supreme Court of New York, in the ease of Gould v. Hill, 2 Kill, 623, in 1842, held that “common carriers can not limit their liability or evade the consequences of a breach of their legal duties, as such, by an — 536 — express agreement or special acceptance of the goods to be transported.” Hutchinson on Carriers discussing this point says: “A few years after this decision the very same question came before the Supreme Court of the United States in the case of New Jersey Steam Nav. Co. v. Merchants’ Bank, 6 How. 344, and the ruling in Gould v. Hill was disapproved; the Court being unanimously of the opinion that a common carrier might, at least by special contract, restrict his liability. This decision was soon followed in the Courts of New York, in which the decision in Gould v. Hill was abandoned as untenable; and the right of the carrier thus to limit his responsibility has ever since remained unquestioned in that State, and may now be stated as the well-settled law of our states as well as of the Supreme Court of the United States. The validity of such special contracts has indeed been nowhere denied, and the case of Gould v. Hill stands as the only reported case in which the right of the carrier to limit his liability in this way is held to be unlawful. It may therefore be stated as the universal law of this country that, in the absence of a statute prohibiting it, all common carriers may by express or special contract with their employer be exonerated from that rigorous rule of the common law which, in the absence of contract, makes them insurers of the safety of the goods intrusted to them.” See, also, Ang. Carr. § 259, and also the case of Railroad Co. v. Sherrod, 84 Ala. 178 (4 So. Rep., 29) where it was held that “a common carrier may by special contract limit his liability for loss of goods to an amount agreed on as the value, in consideration of a reduced rate of freight, provided no extortion or coercion is practiced or threatened, and no undue advantage taken of the shipper; but such special contract does not protect the carrier against liability for fraud, nor for intentional, wanton, or reckless negligence.” So, also, in the case of Hill v. Railroad Co., 144 Mass. 284 (10 N. E. Rep. 836) it appears that “cows belonging to A. were delivered to a coimnou carrier by an agent of A., who was employed to attend to the care and transportation of — 537 — the cattle, and who signed au agreement for their transportation by railroad, in which the value of each cow was estimated at a certain sum, and which provided that the owner of the cows should assume all risk of loss or damage from any cause except from collision of trains, in which case the carrier should not he hold liable for a greater sum than that specified in the agreement;-that the rates of transportation were based upon and intended only for cows of the value specified: and that an additional rate would be charged for cows of greater value. One of the cows was killed by the negligence of the carrier, and not by a collision of trains. Hold, in an action by A. against the carrier, that he could i’ecovor only the value of the cow as expressed in the agreement, and that- he was bound by the agreement made with his agent.” In Graves v. Railroad Co., 137 Mass. 33, the facts are similar and the same principle is announced ; and while there is considerable conflict in the decisions the result of our examination has been that the great weight of authority is in favor of the principles announced in the decisions and authorities above quoted. As we understand the ruling of this Court in Maslin v. Railroad Co., supra, it was held in that case that “a common carrier for hire may by special contract, based on valuable consideration, exempt itself from loss or damage resulting from inevitable accident, though such accident was not the result of the act of Gi-od or of the public enemy, provided the common carrier or its servants' in no manner contributed to such accident; but it can not exempt itself from loss or damage which was in any degree caused by the negligence or misfeasance of itself or its servants.” Our ruling in the case at bar is distinguished from the ruling in that case in this, that we here hold that “where a contract of carriage, signed by the shipper, is fairly made with a railroad company as a common carrier, and the valuation of the property shipped -is agreed upon, and in consideration of the valuation so fixed a rate of freight, is determined upon, on the condition that the carrier assumes liability to the extent of the agreed valuation, even in the case of loss by reason of ■prima facie negligence of the — 538 — carrier the contract will be upheld as fixing the liability of the carrier in proportion to the freight he receives, and protecting himself against extravagant valuation ; and such a contract will not be upheld as exempting the carrier from all liability, but as limiting the liability in case of loss to the amount fixed by agreement. Having reached this conclusion the judgment complained of is reversed, the finding of the Circuit Court is set aside, and a new trial is awarded, with costs to the plaintiff in error.