Virginia Coal & Iron Co. v. Louisville & Nashville Railroad

Buchahan, J. (after stating the ease), delivered the opinion of the court. The defendant in error denies the plaintiff’s right to recover upon two grounds—viz.: Eirst. That no cause of action arose on its guaranty until the principal whose contract it had guaranteed had been prosecuted to insolvency; and, second, that the contract guaranteed was in violation of the act of Congress entitled “An act to regulate commerce,” approved February 4, 1887, ch. 104, 24 U. S. Statutes, 379, as amended-by act approved March 2, 1889, ch. 382, 25 U. S. Stat. 855. As to the first objection. If the defendant was only bound, as its counsel contends, to carry the coke to the end of its own line, and there deliver it to the connecting carrier, its agreement or guaranty that the through rate of freight should not exceed $3.20 per ton might perhaps be construed as a collateral and not an original undertaking, as to the freight beyond its own line, so that no action could be maintained upon it against the defendant- until its principals had been exhausted. But that is not this case, as we understand it. By section 1295 of .the Oode, it is provided that when a common carrier accepts for transportation anything directed to a point of destination beyond the' terminus of its own line or route, it shall be deemed thereby to assume ail obligation for' its safe carriage to such point of [786] destination, unless, at the time of such acceptance, such carrier be released or exempted from such liability by contract in writing signed by the owner or his agent. No such release was obtained by the defendant. When it accepted the coke for shipment, notwithstanding the provisions in the bill of lading to the contrary, it became liable for the transportation of the coke throughout to the point of destination, and the connecting lines of carriers employed in furthering and completing such transportation became its agents for whose defaults it became responsible to the owner of the goods. Hutchinson on Carriers, sec. 145; Dimmitt v. Kansas City, &c., 103 Mo. 433; Ohio & Miss. Ry. Co. v. McCarthy, 96 U. S. 258. Being thus bound to transport the coke safely to its destination, and having agreed that the consideration for doing this should not exceed the rate named, the defendant was liable not only for its own acts but for the acts of its agents, the connecting carriers, in failing to transport the goods safely, or for charging a greater rate of freight than that agreed upon. Having failed to transport the coke at the agreed rate of freight, the defendant was responsible to the plaintiff for the excess of freight charged, unless, as is contended, the agreement was in violation of the Interstate Commerce Act. There was no intention on the part of the defendant company with whom the contract was made, nor on the part of the connecting lines, subject to the Interstate Commerce Act, to violate that act. It is agreed that the defendant company and the Ohio companies intended to charge, and did charge, their duly established and published rates. • Whilst the rate quoted by the Michigan Central was less than the aggregate of its rate and that of the Canadian Pacific, there is nothing to show that, in quoting that rate, it intended to charge less than its duly estabEshed and published rate, and its subsequent conduct in collecting from the Canadian Pacific its established rate of freight when the shipments were delivered to that road, shows that, in [787] quoting the rate of freight over its own line and that of the Canadian Pacific, it did not intend to make any change in its own rate, hut made a mistake as to the rate of the Canadian Pacific. The plaintiff did not intend to violate the act. Its object in inquiring of the defendant the freight rate per ton on coke in car-load lots from Appalachia, Virginia, to Worthington, Ontario, was for the information of its agents, who were negotiating a sale of coke to parties in Worthington. Vo rate from Appalachia to Worthington had then been established. When the defendant informed it what the rate would, be, the plaintiff notified its agents, and they made sale of the coke shipped upon the basis of the freight rate quoted, and at a lower price than usual, and notified the defendant that it desired to make shipments at that rate. Thereupon the defendant issued a, tariff schedule, fixing a rate of $3.20 per ton from Appalachia and other stations on the defendant’s road in that region to Worthington, filed a copy thereof with the Interstate Commerce Commission, posted and published copies at its stations, and mailed copies thereof to the connecting lines. The rate was applicable to all shippers similarly situated. There is nothing in the Interstate Commerce Act, as we understand it, which prevented the defendant from establishing a through rate from Appalachia to Worthington, based upon its existing rate and the rates quoted to it by the connecting carriers, which were subject to the Interstate Commerce Act. The rate thus established was made public and filed with the-Interstate Commerce Commission by the defendant, but not by the other carriers which were subject to the Interstate Commerce Act. Did their failure to do this make the plaintiff’s contract with the defendant for the shipment of the coke illegal, or did it not merely subject them to the penalties of the act? Surely a shipper will not be deprived of the benefit of an otherwise valid contract for the transportation of his goods because connecting carriers have failed to perform their duty in giving [788] publicity to the rate. If he can, no one will be safe in making contracts for the sale or transportation of his goods'based upon the published rate of the initial carrier. Ve are of opinion that the contract in question was not in violation of the Interstate Commerce Act, and that the plaintiff was entitled to recover from the defendant the amount of freight collected in excess of the agreed rate. The judgment of the Circuit Court must be reversed, and this court will enter such judgment as it ought to have entered. Reversed.