965 F.2d 391 | 7th Cir. | 1992
Lead Opinion
Capitol Converting Equipment, Inc. (Capitol) hired LEP Transport, Inc. (LEP) to arrange for the transportation of certain machinery from Genoa, Italy to Chicago, Illinois. Because the machinery never reached Chicago, Capitol sued LEP under the Carmack Amendment, 49 U.S.C. § 11707, and for breach of contract under Illinois law. The district court granted LEP’s motion for summary judgment, holding that the Carmack Amendment is inapplicable to this transaction and that LEP’s liability to Capitol is limited to $150.00 under Illinois law. For the reasons that follow, we affirm.
I.
Capitol markets industrial machinery to manufacturers of cardboard and paper containers; LEP’s business includes arranging for the international and domestic transportation of goods. Capitol and LEP have done business together since approximately 1977, engaging in “hundreds of transactions” during that time.
After LEP and Capitol’s phone conversation, but apparently before either became aware of the fate of Capitol’s machinery, LEP sent Capitol an invoice for its services in arranging for the machinery’s transportation, and for freight charges LEP had prepaid on behalf of Capitol. At the bottom of the front of this letter-size invoice appears the instructions “SEE REVERSE SIDE FOR TRADING CONDITIONS.” On the reverse side are nine standard terms and conditions in separately numbered paragraphs. These same terms were included on the back of each invoice LEP sent Capitol during the time they did business together. The two relevant paragraphs state:
1. The Company assumes no liability as a carrier, and is not to be held responsible for any loss or damage to the goods to be forwarded, but undertakes only to use reasonable care in the selection of carriers, truckmen, lightermen, forwarders, agents, warehousemen and others to whom it may entrust the goods for transportation, handling and/or storage or otherwise, subject to the conditions imposed by such carriers and other parties.
* * * * * *
5. The Company shall not be liable or responsible for any claim or demand from any cause whatsoever, unless in each case the damages alleged to have been suffered be proven to be caused directly by the negligence of the company, its officers or employees, in which event the liability of the Company shall not exceed $50.00 per package.
As a result of the failed shipment, Capitol began this case against LEP as a one-count breach of contract action in diversity under Illinois law. Subsequently, Capitol added an additional count under 49 U.S.C. § 11707 (the Carmack Amendment), and also added another defendant (Containership) who was allegedly involved in the shipment once it reached Virginia. In November 1990, the district court granted LEP summary judgment on both counts, limiting its liability to Capitol to $150.00 (three boxes at $50.00 each). See Capitol Converting Equipment, Inc. v. LEP Transport, Inc., 750 F.Supp. 862 (N.D.Ill.1990). LEP then consented to an entry of judgment against it for $150.00.
II.
We first address the district court’s grant of summary judgment to LEP on Capitol’s Carmack Amendment claim.
Whether a bill of lading is a “through” bill of lading is predominantly a question of fact. See, e.g., Tokio Marine, 717 F.Supp. at 1309. Capitol, however, has failed to present any conflict on this question. In LEP’s Rule 12(m)
III.
The district court also granted LEP summary judgment on its limitation of liability defense to Capitol’s breach of contract claim, deciding that a prior course of dealing between LEP and Capitol incorporated LEP’s standard liability limitation into its bargain with Capitol. See Capitol, 750 F.Supp. at 865-68. Whether a course of dealing exists between parties to a transaction is a question of fact. Gord Industrial Plastics Inc. v. Aubrey Mfg., Inc., 103 Ill.App.3d 380, 385, 59 Ill.Dec. 160, 164, 431 N.E.2d 445, 449 (5th Dist.1982). A course of dealing is a “sequence of previous conduct between the parties to a particular transaction which is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.” Ill.Rev. Stat. ch. 26, ¶ 1-205(1).
Rather than arguing that it was not responsible for the misfortune of Capitol’s machinery, LEP sought to limit its liability to Capitol to $150.00 pursuant to the limitation provision on the back of its invoice. LEP and Capitol both agree that this dispute arises from an oral agreement made when Capitol phoned LEP in November 1985 requesting that it arrange transportation of its machinery from Genoa to Chicago. Also undisputed is that neither party discussed the issue of liability during the phone conversation, R. 78, 81, thus making their oral agreement silent on this term. In support of its motion for summary judgment, LEP submitted its required Rule 12(m) statement, which incorporated two affidavits previously submitted, attesting to its business experience with Capitol. See R. 42, 76, 78, 83. Capitol does not contest the facts that it had done business with LEP since at least 1977 and had engaged in “hundreds of transactions” with LEP during that time. Neither does Capitol dispute that each invoice it received from LEP (and paid) contained the same term limiting LEP’s liability to $50.00 per package. As noted earlier, we deem admitted these uncontested material facts. Local Rule 12(n). The only item that Capitol offers in opposition to LEP’s motion is the affidavit of its president, Norman Singer, stating that neither he nor anyone at Capitol was aware of LEP’s liability limitation. Giving full credit to this claim as we must on LEP’s motion for summary judgment, we agree with the district court that, standing alone, Singer’s affidavit is insufficient to create a genuine factual dispute over whether a course of dealing as to a liability limitation existed between LEP and Capitol.
In sum, Capitol’s arguments cannot disguise the fact that LEP is entitled to summary judgment because Capitol has not overcome LEP’s overwhelming evidence of the nature and extent of the parties’ business practice. Commercial law, perhaps to a greater degree than other areas, is a “magic mirror” — a norm-taker as well as a norm-maker, reflecting commercial practice as well as engineering it. See, e.g., Kermit L. Hall, The Magic Mirror: Law in American History (1989). LEP has made an affirmative and uncontested showing in support of its summary judgment motion that it has participated in the same type of commercial transaction, with the same party, under the same terms, since at least 1977. This transaction should be treated no different: the parties’ prior course of dealing is fairly to be re
Affirmed
. Our statement of the facts is taken from the parties’ Local Rule 12 statements of uncontested facts. R. 78, 81.
. Although LEP points out that a Rule 58 judgment was never entered by the district court, this oversight does not deprive us of jurisdiction if it is clear from other sources that an order is final. First National Bank of Chicago v. Comptroller of the Currency, 956 F.2d 1360 (1992). Here, finality is evident from Judge Moran's November 19, 1990 order regarding LEP’s consent to entry of judgment against it on count two of Capitol’s complaint, see R. 93, 94, and again in Judge Moran’s order granting summary judgment to Containership, which concluded this litigation in the district court. See R. 117, 118. Thus, we have jurisdiction under 28 U.S.C. § 1291.
. Local Rule 12 of the Northern District of Illinois was amended effective June 4, 1990. The amendment redesignated former Rule 12(1) as Rule 12(m) and former Rule 12(m) as Rule 12(n). Because the amendment did not change the language of these provisions, we refer to them by their amended designations rather than the ones the parties used.
. We note that Capitol’s neglect of this bill-of-lading issue continued on appeal. Although the district court clearly based its decision on the fact that the bill of lading’s “through” status removed this transaction from the ambit of the Carmack Amendment, Capitol chose not to raise this issue on appeal either in its initial or reply brief. Instead, Capitol addressed its arguments to whether LEP is a "freight forwarder” within
. The "course of dealing" provisions are found in article one of the Uniform Commercial Code (as adopted in Illinois), which means that it is not limited to the sale of goods but applies to all commercial contracts and by analogy to noncommercial contracts as well. See Farnsworth, Contracts § 7.13.
. We do not imply that actual awareness of a particular contractual term is never relevant to a course of dealing analysis. Qn the facts of this case, however, where Capitol's alleged unawareness stands alone in sharp contrast to LEP’s detailed and unrefuted showing of the parties extensive business history spanning many years and hundreds of transactions, it is insufficient to create a genuine factual dispute over whether a course of dealing existed regarding LEP’s liability limitation at the time of the transaction in question. Precisely when and
. Capitol’s argument that Latex Glove Co. v. Gruen, 146 IIl.App.3d 868, 100 Ill.Dec. 488, 497 N.E.2d 466 (1st Dist.1986), requires that LEP’s summary judgment be reversed is similarly flawed. Latex Glove's complaint against Gruen (a printer) for breach of contract to produce certain catalogues was dismissed for the failure to state a claim. Latex Glove, 100 Ill.Dec. at 493, 497 N.E.2d at 471. Latex Glove had also asserted that, according to trade usage, its bargain with Gruen included certain byproducts of the catalogue’s production as well as the catalogues themselves. In seeking to establish this contract between itself and Gruen, Latex Glove pointed to various price quotations and discussions. But the court noted “that non-parties both made and accepted these various offers.” Id. at 491, 497 N.E.2d at 469. Thus, Latex Glove’s action was dismissed because it did not adequately allege any bargain between itself and Gruen, not because trade usage could not be used to establish the contours of that bargain. Id. at 491-93, 497 N.E.2d at 469-71. Because no underlying contract existed, the court was constrained to interpret Latex .Glove's trade usage argument as an attempt to ask the court to "impose a new obligation instead of filling a gap in the contract terms.” Id. at 492, 497 N.E.2d at 470. Latex Glove is thus distinct from this case in which the parties are seeking to establish the contours of an underlying agreement.
Concurrence in Part
concurring in part and dissenting in part.
I concur in the majority’s conclusion with respect to the applicability of the Carmack Act. I respectfully decline to join the majority’s conclusion that no genuine issue of fact remains as to whether the prior course of dealing between LEP and Capitol incorporated LEP’s standard liability limitation into its bargain with Capitol.