Watson-Higgins Milling Co. v. PERE MARQUETTE RAILWAY CO.

328 Mich. 5 (1950) 43 N.W.2d 43

WATSON-HIGGINS MILLING COMPANY
v.
PERE MARQUETTE RAILWAY COMPANY.

Docket No. 2, Calendar No. 44,552.

Supreme Court of Michigan.

Decided June 5, 1950.

Linsey, Shivel, Phelps & Vander Wal, for plaintiff.

Harrington, Waer, Cary & Servaas and Robert M. Waer, for defendant.

BOYLES, C.J.

The facts in this case are not in dispute. Plaintiff is engaged in the flour-milling business at Grand Rapids, and the defendant is a railroad common carrier. In May, 1944, plaintiff requested the defendant to spot a box car on plaintiff's siding, in which to ship flour. On May 24th the car was spotted at plaintiff's loading dock and on the same date examined for leaks and loaded with 900 100-pound sacks of flour. Uniform bill of lading was issued May 25th by the defendant company for shipment of the flour to a delivery point in Pennsylvania. Government inspectors there condemned the shipment for being bug and worm infested, and the shipment was returned to Grand Rapids where the flour was taken from the car, remilled, resacked, reloaded and shipped to another destination in Pennsylvania where it was then accepted and paid for.

Plaintiff, on May 23, 1945, filed a claim with the defendant for $1,108.63 loss by reason of the original shipment having been rejected. This claim was received by the defendant May 31, 1945, more than a year after the delivery of the original shipment to the railroad company and the issuing of the bill of lading. The railroad company denied liability on the ground that the claim had been filed more than 9 months after the shipment had been delivered to it. Thereupon plaintiff brought the instant suit, declaring in 3 separate counts, based on negligence, contract, and adding the common counts. In its answer the defendant relied on the defense that notice of the loss had not been given the company within 9 months. The defendant also asked for a judgment in its favor in the amount of $108 for unpaid freight bill.

The case was heard by the court without a jury. Plaintiff's theory was that the defendant was negligent in furnishing plaintiff a car infested with bugs, unsuitable for shipment of flour, knowing it was to be used for that purpose. The defendant relied upon the defense that plaintiff's failure to file a claim within 9 months barred recovery. The court held that the defense was good and entered judgment for the defendant for the unpaid freight bill, $108, and costs. Plaintiff appeals.

It is conceded that a condition in the uniform bill of lading under which the shipment in question moved was also a part of the railroad company's published tariffs, filed with the interstate commerce commission (consolidated freight classification No 16, § 2-b), which provided that as a condition precedent to recovery plaintiff's claim must be filed with the defendant company within 9 months after delivery of the property to the carrier. Plaintiff claims that this provision which was printed on the reverse side of the bill of lading was in print so small that it could not be read by the average eye and that it was for all practical purposes illegible; and that for that reason it could not be relied upon as a defense to the claim. However, we need not consider that question when the same provision occurred in the published tariffs filed by the railroad company with the interstate commerce commission. The defendant company is an interstate common carrier by rail and the goods were shipped in interstate commerce. The published tariffs filed with the interstate commerce commission become part of the contract and bind the parties.

"The contract for carriage of an interstate carrier must be in accord with the rules and regulations governing interstate commerce. Pennsylvania R. Co. v. Marcelletti, 256 Mich. 411 (78 A.L.R. 923).

"``The tariffs and schedules filed with the interstate commerce commission become a part of the contract and as such binding on the parties. To hold otherwise would open wide the door for unjust discrimination. * * * The relations of the shipper and carrier are contractual. * * * In order to prevent discrimination the law has provided that certain things shall be done in all shipments. Neither the shipper nor the carrier can deviate from them without discrimination which is the important thing inhibited.' Thomas Canning Co. v. Southern Pacific Co., 219 Mich. 388, 396; 223 Mich. 154." Rockwell v. Grand Trunk Western Railway Co., 264 Mich. 626.

"We have repeatedly held that the classification of tariffs of a carrier on file with the interstate commerce commission becomes part and parcel along with the bill of lading in making up the contract of carriage." Hecker Products Corp. v. Transamerican Freight Lines, Inc., 296 Mich. 381.

The trial court correctly held that the failure of plaintiff to comply with the contractual provision requiring that plaintiff's claim must be filed with the carrier within 9 months from delivery of the shipment to the carrier bars recovery.

Plaintiff claims that it should have the right to recover damages for negligence notwithstanding its failure to file its claim within the required 9 months This has been decided adversely to plaintiff's claim in the second appeal of Thomas Canning Co. v. Southern Pacific Co., 223 Mich. 154, where this Court held:

"The case presents the same legal questions as when here before, supplemented by the claim that where loss happens through negligence of the carrier, limitation of time within which to bring suit, as determined in our former opinion, does not apply.

"The re-argument of the questions is most ingenious but induces no thought of error in our former decision. * * *

"The loss through claimed negligence falls within the clause ``suits for loss, damage or delay,' and the limitation mentioned in our former opinion applies thereto."

In a separate paragraph concluding its answer the defendant alleged:

"DEFENDANT'S SET-OFF

"The freight charges which were due in connection with the shipment of freight set forth in plaintiff's declaration amounted to $108, which amount plaintiff has neglected and refused to pay. Defendant therefore asks for a judgment against the plaintiff on account of said charges in the amount of $108, plus interest from May 25, 1944, at the rate of 5 per cent. per annum.

"WHEREFORE, defendant claims judgment against the plaintiff in the sum of $200."

Plaintiff claims that the defendant is not entitled to a "set-off." It matters not whether the label is set-off, recoupment, counterclaim or cross action. Said paragraph is plainly worded and its purport is clear. Recoupment is, in effect, a counterclaim or cross action for damages; and under CL 1948, §§ 615.5, 615.10 (Stat Ann §§ 27.830, 27.835), the defendant is not limited to a recovery of damages only by way of abatement or reduction of plaintiff's claim but may now recover judgment for recoupment. Lyons v. City of Grand Rapids, 305 Mich. 309.

The proofs support the judgment in favor of the defendant for the freight bill and is affirmed.

REID, NORTH, DETHMERS, BUTZEL, CARR, BUSHNELL, and SHARPE, JJ., concurred.