Schenberger v. Union Pacific Railroad

The opinion of the court was delivered by Benson, J.: This is an action to recover damages alleged to have been suffered by the plaintiff by reason of the false and fraudulent statements of its freight agent that the rate for the transportation of wheat in carload lots from Wakefield, Kan., to New Braunfels, Tex., was 31 cents per hundredweight, when in fact the regular rate was 431/2 cents per hundredweight, whereby the plaintiff suffered damages in the sum of [80] $150.25, being the difference between the rate quoted and the regular rate charged upon two cars of wheat ■sold and shipped in reliance upon the truth of the statement of the defendant’s agent that the rate was 31 cents per hundredweight. The case was tried upon an agreed statement of facts, from which it appears that the plaintiff inquired of the defendant’s agent at Wakefield, Kan., for the freight rate on wheat in carload lots from that station to New Braunfels, Tex., and informed the agent that he desired to know the rate in order to fix the price of wheat which he had an opportunity to sell at New Braunfels. The agent said that he could not give the rate, but would obtain it. Shortly afterward the agent received a letter from a general freight agent of the company advising him •that the rate inquired about was 31 cents per hundredweight, and so stated to the plaintiff. Relying upon the information so obtained, the plaintiff fixed the price to his customer and sold to him two carloads of wheat,- which was then shipped over the ■ defendant’s line to New Braunfels-, and the plaintiff paid .or offered to pay the rate named,- viz., 31 cents per hundredweight. . When the wheat arrived at the place of destination an additional charge of- 12% cents per hundredweight was made and collected, making 43% cents per hundredweight on the shipment, which was the correct rate on file with- the interstate commerce commission, being 12% cents from Wakefield to Kansas City, and 31 cents from Kansas City to New Braunfels. The mistake in quoting the rate was unintentional, and was made without fraudulent intent. Judgment was rendered for the plaintiff as prayed for, and the defendant appeals. The defendant relies upon the provisions of the interstate commerce act, its tariffs of freight rates between the places named having been filed with the interstate commerce commission. It was held in Railway Co. v. Milling Co., 80 Kan. 141, and in Railway [81] Co. v. Refining Co., 83 Kan. 732, that the schedule of rates published and filed with the interstate commerce commission must govern. Any claim that such rate is unjust must be presented to that tribunal. This is not disputed by the plaintiff, but it is insisted that the claim is not based upon a contract for less than the regular schedule rates but upon a misrepresentation of such rates, that the interstate commerce act does not relieve a carrier from damages caused by its negligence and false representations in such matters, and that the action is not upon contract, but in tort. Can the plaintiff recover damages for a misrepresentation of the rate when he could not have recovered upon an express agreement for that rate? It is not necessary to inquire into the purposes and scope of the interstate commerce act. They have been elaborately considered and stated in decisions of the federal supreme court. The interpretation of the law by that tribunal appears to be decisive of this controversy. (Gulf, Coloroad &c. Railway v. Hefley, 158 U. S. 98; Texas & Pacific Railway v. Mugg, 202 U. S. 242; Texas & Pac. Ry. v. Abilene Cotton Oil Co., 204 U. S. 426; Armour Packing Co. v. United States, 209 U. S. 56.) In the Mugg case (202 U. S. 242) the action was to recover damages by reason of negligence in the misquotation of the rates for carrying coal on an interstate shipment, on ydiich rates the plaintiff in that suit had relied and had sold the coal at a price based on the rate so given. The carrier collected freight charges according to the established rate as filed. The shipper sued, expressly alleging negligence in giving the rate as his ground of action. The supreme court of Texas ordered judgment for the plaintiff, but this was reversed and it was held that under the interpretation of the interstate commerce act by earlier decisions of the court, then reviewed and followed, there could be no recovery. [82] It was held in the case of the Armour Packing Company (209 U. S. 56), in a prosecution for rebating, that although a contract for carriage of goods at. a stipulated rate was valid when made, being the same as the tariff rate,- yet it was a violation of the law to carry the goods at that rate after it had been superseded by a higher one made and filed as provided in the interstate, commerce act. The court said that “neither shipper nor carrier may vary from the duly filed and published rate without incurring the penalty of the law.” (p. 81.) Referring to the effect of the decision upon contracts for future delivery, the court said: “It may be, as urged by petitioner, that this construction renders impossible the making of contracts for the future delivery of such merchandise as the petitioner deals in, and that the instability of the rate introduces a factor of uncertainty, destructive of contract rights heretofore enjoyed in such property. This feature of the law, it is insisted, puts the shipper in many kinds of trade at the mercy of the carrier, who may arbitrarily change a rate upon the faith of which contracts have been entered into. But the right to make such regulations is inherent in the power of congress to legislate respecting interstate commerce, and such considerations of inconvenience or hardship address themselves to the lawmaking branch of the government.” (p. 81.) The judgment is reversed, with directions to enter judgment for the defendant upon the agreed statement of facts.