Pacific Indemnity Co. v. Atlas Van Lines, Inc.
642 F.3d 702
9th Cir.2011Background
- Manasters move household goods from Chicago to Phoenix; insurance requested as $1 million, but value not declared in paperwork.
- Pickens contracted with TCI, which contracted with Atlas; Atlas billed per pound rate, but no declaration of $1 million value was communicated to TCI/Atlas.
- Bill of lading for the shipment left valuation blank; no declared value noted by Pickens; warehouse bill of lading also had blank valuation.
- Goods destroyed by fire while in Atlas's custody; Pacific paid $1 million to Manasters and was subrogated to their rights.
- District court held Atlas liable to Pacific and Pickens for $52,500 ($5.00 per pound) and Pickens liable to Pacific for $1 million; Pickens prevailing on cross-claims for costs.
- Atlas and Pickens appealed; issues centered on replacement value under Carmack Amendment and cost apportionment under § 14706(b).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Replacement value for undeclared shipments | Pickens entitled to full replacement value without declared value. | Without declared value, Board rules set replacement value at $4.00 per pound (or $5,000 minimum). | Replacement value limited to $4.00 per pound under Board rule; undeclared value yields tariff-based replacement value. |
| Tariff-based liability versus released rates | Released rates should apply only if full value is waived; no waiver here, so full value applies. | Undeclared value triggers Board rule setting replacement value at tariff amount; released rates apply accordingly. | Tariff-based replacement value ($4.00 per pound, or $5,000 minimum) governs when value is undeclared. |
| Cost shifting under Carmack § 14706(b) | Pickens should recover its costs from Atlas as the carrier whose line caused the loss. | Prevailing party concept applies; Pickens was not entirely blameless and argues recovery should be limited. | Pickens entitled to its reasonable costs from Atlas; the statute permits cost recovery without a traditional prevailing-party rule. |
Key Cases Cited
- Kawasaki Kisen Kaisha Ltd. v. Regal-Beloit Corp., 130 S. Ct. 2433 (U.S. 2010) (strict liability scheme in Carmack framework; relieves cargo owner of carrier-by-carrier search)
- Mason & Dixon Intermodal, Inc. v. Lapmaster Int'l LLC, 632 F.3d 1056 (9th Cir. 2011) (states cost-recovery framework under Carmack 14706(b))
- Fulfillment Servs., Inc. v. United Parcel Serv., Inc., 528 F.3d 614 (9th Cir. 2008) (Chevron analysis for agency interpretation of Carmack provisions)
- DHX, Inc. v. Surface Transp. Bd., 501 F.3d 1080 (9th Cir. 2007) (agency deference to Board rules on valuation of undeclared shipments)
- Reider v. Thompson, 339 U.S. 113 (1950) (foundation for strict liability allocation among carriers in interstate shipments)