Russell v. Erie Railroad , 67 L.R.A. 433 ( 1904 )

The opinion of the court was delivered by -

Vroom, J.

It was conceded at the trial that in the course of transit from Buffalo, New York, to Rutherford, in this state, the property of the plaintiffs below was lost, and that the plaintiffs were entitled to a verdict for some amount by reason of that loss. The claim of the railroad company was that the trial judge should have charged the jury to find a verdict for the plaintiffs for $6.47, being the amount of the value of the shipment at the rate of $5 per one hundred pounds, plus tire amount of freight — forty-seven cents. ■ This request of defendant was declined and the case .was left to the jury on tiro questions whether Mrs. Russell was charged with the terms of the returned bill of lading and the writing thereon, and whether the carter Hoffmeister had apparent authority to agree to a limitation of liability, and whether there was an agreement made to limit liability.

The first count in the declaration-attributed negligence to the defendant’s employes in the carriage and transportation of these goods, but tire trial judge properly held that this was not sustained by tire evidence and charged the jury'that they could not find a verdict against the defendant on that ground.

That it is lawful for a carrier, by special contract, to limit his common law liability is admittedly the general rule in this country, and he may thereby exempt himself from liability for any loss resulting otherwise than by the negligence or misfeasance of himself or his servants. That a common carrier cannot by contract secure exemptions from liability-for losses occasioned by its negligence, was held in Paul v. Pennsylvania Railroad Co., Supreme Court, February Term, 1904.. Where there is no express contract limiting the liability of the carrier, he is bound, when goods are delivered to him for transportation, to deliver them unless prevented-by the act of God or other cause which would excuse- the carrier from the undertaking of insurance.

The question then arises whether there was any contract made in this case limiting the liability of the defendant, which is binding on the plaintiff, Mrs. Eussell. The burden of proof of showing such a limitation of liability is on the defendant company, and being in derogation of common right, is to be construed most strongly against the carrier. 5 Am. & Eng. Encycl. L. (2d ed.) 336; Ashmore v. Pennsylvania Railroad Co., 4 Dutcher 180; Hooper v. Wells, Fargo & Co., 27 Cal. 11. No presumptions will be indulged in in favor of exemptions from common law liability. While it is competent for a common carrier to provide by contract for such exemptions, it must be done in clear and unambiguous terms. Edsall v. C. & A. R. R. Co., 50 N. Y. 661; Babcock v. Lake Shore and M. S. Ry. Co., 49 Id. 491; Aetna Insurance Co. v. Wheeler, Id. 616; 6 Encycl. L. & Pro. 408.

It will be conceded that the only contract, limiting the liability of the company was made with one Hoffmeister, a cartman, employed by the Goldhagen Storage Company to carry the box containing the goods to the railroad. The instuction to have the goods "shipped was from Mrs. Russell, and the directions in her letter to O. E. Goldhagen were simply to send a box, marked “Last Box Packed,” to M. C. Russell, Rutherford, New Jersty, over the Erie railroad. Mr. Goldhagen did not go personalty with these goods, but delivered them with the two shipping orders, which he had filled out in his own hand, to a cartman, first to one Weisser, who turned the1 box and two papers over to another cartman named Hoffmeister. The evidence is explicit that no instructions were given to the carter save “take the goods,” “pay the freight.” lie was given the money to pay the freight and to bring back the bill.

It will not be disputed that the doctrine cited by the plaintiff in error is correct, that “a consignor, who sends goods to the depot of a carrier for shipment by an agent, impliedly authorizes such agent to make a special contract with the carrier as to the carriage of the goods, and the acceptance by such agent of a receipt or bill of lading containing limitation upon the liability of the carrier will bind his principal.” . 5 Am. & Eng. Encycl. L. (2d ed.) 305:

The law was clearly stated by the trial judge'in his charge: “The ordinary rule is that a person, entrusted with goods to take to a freight office in order that the3r may be shipped by the railroad, is presumed to have general authority to agree with the railroad company as, to the terms of shipment; and that would include authority to malee a reasonable agreement limiting the liability of the railroad company as an insurer, limiting it with respect to the valuation of the goods as far as the contract goes. So that, if Golclhagen, or the Goldhagen Storage Company, had gone with the goods, or if any person, lawfully authorized by the Goldhagen company had gone with the goods without any limitation of his authority appearing, in that event it would be presumed that he had a right to make the contract limiting the railroad company’s liability.”

Notwithstanding the fact that there were no other instructions given to the carter, Hoffmeister, than .aboye mentioned, the railroad company contends that the cartman had authority to make, in behalf of the plaintiff, a contract limiting the common law liability of the defendant company. 6 Encycl. L. & Pro. 408, as follows, was cited in support of this contention: “One who has authority to ship goods for another has thereby implied authority to make a contract for their shipment, involving a limitation of the carrier’s liability. Even though the delivery of the goods is by the cartman or teamster, if, by the usual course of business between the shipper and the carrier, it is customary for the cartman or teamster to accept the shipping contract, valid limitations therein limiting the carrier’s liability will be binding on the shipper.”

' This is a broad statement and not borne out by the examination of the cases I have made; it will-be noted, however, that nothing appeared in the testimony in this ease showing the usual course of business between the shipper and the carrier, or that it was customary for the cartman or teamster to accept the shipping contract; but it docs appear from the evidence that the cartman here had no express authority to agree to a limitation of liability.

An instructive case (Nelson v. Hudson River Railroad Co., 48 N. Y. 498) from the Court of Appeals of New York was cited by both the plaintiff and defendant in error; by the former, because it seemed to support the authority of the cart-man to make a contract limiting liability; by the latter, because the enforcement of the liability was not put upon the ground that the cartman had authority to make the contract, but of what the court termed “a most complete and unequivocal ratification of the contract by the consignor.” In the opinion in that case Judge Earl said (at p. 510) : “The cartman had no authority to malee this contract. He was merely the servant of the consignors to deliver this box to the railroad and was clothed with no discretion to act for them. No authority could be implied from his character or business, and his principals were near at hand where they could act for themselves. But he assumed to act for them and to do what they were authorized to do. They were notified of all the facts and the contract made by him for them was delivered to them. They were informed if they had any objection to the contract made by their assumed agent, they should notify the defendant tire next day. They made no objection and expressed no dissatisfaction with the contract, leaving the defendant’s agent to suppose that it was satisfactory to them. It seems to me these facts constitute a most emphatic and unequivocal contract. A subsequent ratification, with knowledge of -the facts — of the acts of the assumed agent-— is equivalent to an original authority, and as this was a contract which the consignors would have deputed the cartman to make - for them, it must be treated as made by them in person and binding on the plaintiff.”

And in Seller v. Steamship “Pacific," 1 Oreg. 409, it was held that where a drayman of the shipper, on the delivery to the carrier of a package, takes a receipt from the freight clerk of the ship, containing the words “not accountable for contents,” this of itself does not constitute such an agreement; it is a mere ex parle proposition on the part of the carrier after the receipt of the package, and to' exonerate the carrier there must be direct -or unequivocal evidence of the assent of the shipper. . '

I am clearly of opinion that no authority was disclosed which would warrant the making of any contract by the cartman which would limit the liability of the railroad company as common carriers. When the Goldhagen Storage Company sent tins box by the cartman to the railroad station, it was accompanied by a complete shipping order, and upon what principle can it be contended that the agent of the railroad company had the right to assume that the cartman had authority to alter or modify the terms of the shipping order ? It seems to me that the duty of the agent plainly was to accept the goods on the terms stated in the order or refuse them, or he could, as actually was done here, take the risk of subsequently showing the authority of the cartman to change the terms of the contract. The railroad compan}' was notified by the presentation of this shipping order, signed by the storage company, that the authority of the cartman was in no sense discretionary, that it was of the simplest kind, and consisted merely of delivering the goods and inquiring and paying the amount of freight, and there was no authority on his part to enter into any contract so important as the exemption of the railroad company from liability.

The charge of the trial judge on this point was not erroneous, although too favorable to the defendant.

If, however, the act of Hoffmeister was subsequently ratified by the Goldhagen Storage Company, or Mrs. Russell, it is binding upon Mrs. Russell, although Hoffmeister was not authorized to make this limitation and although he was not clothed with apparent authority. As was laid down in Nelson v. Hudson River Railroad Co., supra, “a subsequent ratification with knowledge of the facts of the acts of the assumed agent is equivalent to an original authority.”

The contention of the plaintiff in error was that there was acceptance and ratification by Goldhagen, plaintiff’s agent, of the offer of the carrier to reduce the freight rate in consideration of the limitation of liability authorized by Mrs. Russell, But there was no duty in the. Goldhagen Storage Company, on the return of the carrier with the bill of lading, to see whether the railroad company had accepted the goods on the terms stated in the shipping order; this, I think, was to be assumed in the absence of notice to- the contrary. In the case of Nelson v. Hudson River Railroad Co., supra, notice was given to the consignors of the contract made for them by the eartman, and they were given until the next day to object to it. The intention of a carrier to limit Iris liability as insurer must be brought home to the shipper by a clear and unambiguous notice, and as stated by the Supreme Court of the United States, “the right of the carrier, then, to limit his liability in the shipment of goods has, we think, never been doubted. But admitting the right thus to restrict his obligation, it by no means follows that he can do it by any act of his own. He is in the exercise of a sort of public office and he has public duties to perform from which he should not be permitted to exonerate himself without the assent of the parties concerned. And this is not to be supplied or inferred from a general notice to the public, limiting his obligation, which may or may not be assented to.” New Jersey Steam Navigation Co. v. Merchants’ Bank, 6 How. 382.

A ratification is defined to be the confirmation of a previous act done either by the party himself or by another;. it is the confirmation of a voidable act. 23 Am. & Eng. Encycl. L. 889. And a confirmation necessarily supposes a knowledge of the thing ratified. Blen v. Bear River, &c., Mining Co., 20 Cal. 613; San Diego Railroad Co. v. Pacific Beach Co., 112 Id. 53. It follows, then, that in order to constitate a ratification there must be an acceptance of the -results of the act with an intent to ratify and with full knowledge of all the material circumstances. Ansonia v. Cooper, 64 Conn 544.

The insistment of toe railroad company is that even if the eartman had no lawful authority to make the agreement limiting the company's liability, yet the receipt- of the bill of lading, as changed by G-oldhagen without objection, was an acceptance of the company's proposition, and likewise the receipt of the bill of lading by Mrs. Russell without objection was an acceptance by licr of the contract therein expressed. In other words, both ratified lire illegal contract made by the eartman. But if ratification necessarily supposes a knowledge of the thing ratified, and Mr. Goldhagen testified that he noticed no alteration in the bill of lading when he sent it to Mrs. Russell on its return to him by the eartman, and as no notice was given to him of the alteration, there could have been no ratification on his part. And Mrs. Russell certainly could not have been held to ratify it in the absence of any notice, and when she received the bill of lading-not earlier than three days after the goods were shipped and too late to recall the box.

This question of ratification the trial judge left to the jury, and the following parts of his charge relate thereto : “Now, did Mr. Goldhagen see that (referring to the alterations by the company’s agent in the bill of lading) and notice it? He testifies not. I don’t know anything on which you have a right to believe that he did see it, and notice it as an alteration of the contract, and therefore the question is, was 'he negligent in not noticing it? Would a reasonably careful man in his situation have noticed it- — noticed it, I mean, not as a mere scratch or word written upon the paper, but as an intended alteration of the contract that he had proposed to the company? That is the point.”

.“If Mr. Goldhagen did not notice it, then comes the question of what Mrs. Russell noticed. It was mailed — the paper was mailed, this bill of lading — by Goldhagen to Mrs. Russell and reached her presumably a day or two after the 24th day of September, two or three days after the shipment, as I understand the evidence.”

“Well, the question of what he, as a reasonably prudent person, ought to do, is quite different, because, you see, she was not where she could easily communicate with the railroad, and not as well charged with the circumstances of the shipment as Mr. Goldhagen; but, at any rate, it is for you to say whether, if she had been reasonably prudent, she would or would not have been charged with this notice.”

Clearly, so far as the plaintiff in error is concerned, there was no error in this part of the charge; the only criticism to be made, if any, is that it is too favorable to the plaintiff in error.

The questions of the authority of the cartman to modify the terms of the contract, and of the notice to the consignor of such alteration, and of ratification, having been found by the jury in favor of the plaintiffs below, the added terms to the bill of lading, describing the contents of the box as “EL EE. gds.” and limiting the liability to $5 per one hundred pounds, become immaterial and need not be further considered.

I find no error, and the judgment below should be affirmed.

For affirmance — The Chancellor, Chief Justice, Dixon, Garrison, Fort, Swayze, Bogert, Yredenbwrgi-i, Yroom, Green, Gray. 11. For reversal — None.