Rohner Gehrig Company, Inc. v. Tri-State Motor Transit

POLITZ, CLARK, Judge, Chief Before JOLLY, GARWOOD, KING, JONES, DAYIS, HIGGINBOTHAM, BARKSDALE, WIENER, DUHÉ, SMITH, DeMOSS, GARZA, Circuit M. EMILIO Judges.* WIENER, Judge: Circuit is- today, we reconsider Sitting banc en rendered decision addressed sues in this a divided banc * en deci- participate not to DeMoss, elected after Jr. sworn was Judge R. Harold sion. Banc Court argued the En this case (2) Commission; ship obtain the merce Transit.1 Motor v. Tri-State Gehrig Co. his choice of liabili per’s agreement the dis majority reversed There, op summary judgment (3) a reasonable ty; give grant of court’s trict goods, Rohner, two or more portunity to choose between in favor goods. Tri-State, of (4) receipt the carrier against liability; issue a and levels of and dis opinion the summary judgment moving shipm lading prior of to the its or bill principle not recognized a had trict court ent.3 this cir expressly adopted

heretofore panel’s adoption of agree with the We (B.O.L.) lading that of A carrier’s bill cuit: test and the substantial Hughes the both (as distinguished from strict substantially But, rule for this circuit. compliance has complies the tariffs ly) with dissent,4 reject the we with agreeing Com Interstate Commerce with the on file determining in role of the give to (I.C.C.) may be sufficient mission the Hughes whether B.O.L. required opportunity to shipper the the the carrier’s tariff and substantially with liability, levels of carrier between choose given thereby the the carrier has whether a concomitant giving the carrier thereby opportunity to choose shipper a reasonable ship liability to the limit its opportunity to liability. or more levels two between Nonetheless, the damage loss. or per for opportunity the carrier such an Without found, the on the basis district shipper a valid obtain from the cannot evidence, summary judgment undisputed liability, caus its agreement as to strictly nor neither B.O.L. that Tri-State’s test and ing Hughes the carrier to fail the the tariffs. substantially complied with limiting its precluded from thus be not entitled carrier was Consequently, the shipper. the to shipper. liability to to limit unanimously affirmed Opinion Panel The I. judgment of the district court’s part adopted substantial that AND FACTS PROCEEDINGS Nonetheless, pan this circuit. rule for procedural histo- operable facts and disagreed majority el in the fully forth are set ry of this case nei B.O.L. finding that Tri-State’s court’s reiteration do not Opinion and bear Panel substantially complied ther briefly that Roh- to It suffices note here. part on Relying principal in with its Air States ner, consignee of the United shipping Rohner’s its determination parts to Force, of aircraft consigned crate industry, in the agent “sophisticated” was B.O.L. Tri-State; printed form com majority found substantial signed for Roh- was by Tri-State in B.O.L. furnished testing Tri-State's pliance by experi- an employee was by an who knowledge experience ner light of con- B.O.L. agent; that the Opin such, the Panel enced agent. As Rohner’s a Greater satisfy statement: “Unless B.O.L. sufficient tained ion found Hereby Declared, Re- Shipper requirements under of the four Value two $5,000.00 Ton in Per by the Circuit the Value enunciated Seventh leases test Article”; Inc.,2 Lines, for Each 2,000 v. Van Pounds Hughes United block special right to limit its establishing the carrier’s was not set out statement inor type, requires a carri liability. Hughes printed test boldfaced was not used size type largest er to: or smallest either style, type B.O.L., heavy line or pre- on (1) a tariff within maintain pro- the box between Interstate was sandwiched guidelines Com- but scribed Van Greyhound (citing Cir.1991) (hereinafter (5th 1415 Antonio Id. at 3. F.2d 1118 1. 923 Cir.1978)). (1st Lines, Inc., Opinion). F.2d 591 103 Panel denied, 1987), (7th cert. 485 Cir. F.2d 1407 2. 829 (Wien- Co., Gehrig 1123-27 F.2d at 1068, (1988). L.Ed.2d 248 108 S.Ct. U.S. dissenting part). er, J., concurring part fourth first and satisfaction Tri-State’s dispute. test never (quoted in Tri-State’s A statement description and on vided above) I of Section paragraph first and the shipped goods to be weight of the clause satisfy the inadvertence ship- purports B.O.L. for block however, statement, dif- This requirement. time and date related signature and per’s tariffs as Tri-State's notably no from contained fers information; the B.O.L. (the rate 203-A NAS liability; the I.C.C.: filed with limitation reference other tariff). (the rule tariff), NAS 190-A no block contained the B.O.L. and that declared to insert a space for pro- tariff rate in Tri-State’s Item rate, valuation, signa- alternate released alia, vides, inter ture, like. or the in such set Conditions forth One of sentence following lading is the of bill II. type on the appears in bold-face which ARE thereof, RATES “WHEN ANALYSIS face RATES RELEASED TO A SUBJECT System A. The Tariff VALUE ORDER, A GREATER UNLESS Amend Carmack 1906, in so-called DECLARED, HERE- THE SHIPPER IS ment, at U.S.C. § codified now $5,000 TO VALUE THE BY RELEASES absolutely forbade Congress (Supp.1990), 2,000 FOR POUNDS TON OF PER shippers liability to limit their carriers ARTICLE. EACH result of As a damage goods. in the statement unequivocal Despite that increased the carriers legislation, will find as to what rate tariff to this Congress reacted sharply. rates fur- B.O.L., that Tri-State the one in the enacting so-called increase rate boldfaced, no such reflects nished Rohner Amendment, codified at 49 now Cummings Neither clause. inadvertence capitalized allows a (Supp.1990), U.S.C. § in clause inadvertence purported does the it liability if to limit its carrier bold- contain tariff’s Tri-State’s through tariffs rates approved with I.C.C. phrase, introductory faced, capitalized I.C.C.5 by the carrier filed A RE- TO SUBJECT RATES ARE “WHEN scheme, if a Therefore, the I.C.C. ORDER, ...” RATES LEASED must liability it its to limit desires 360-3, and 360-1 Additionally, Items forth terms that set or more tariffs file one the “Uni- rule tariff sets forth Tri-State’s freight rates shipment, of and conditions Lading.” Those Straight Bill form ship- relevant to available, and information boldfaced same only Items not contain liability. Cen- including limitation ping, tariff, rate found clause inadvertence liability limitation the scheme tral to con- B.O.L. will each reflect that they also listed rate that each requirement is the rate following typical released tain the rate,” which “released specify a shipper: by the use blank for liability per unit of dollar is the maximum prop- value of or declared agreed be liable. carrier will weight for which by the specifically stated hereby erty is liability limita- I.C.C.’s Also central exceeding_per to be not requirement there is the scheme tion ship- agreement between a written statement unequivocal despite that Again, the form The B.O.L. is the carrier. per and tariff, preprinted rule agreements. Tri-State’s for such frequently used most to Rohner by Tri-State B.O.L. furnished liability, limit is If the carrier a re- nothing approximating even contained shipper and between agreement written blank, from less that one much leased rate “inadvert- so-called a must contain or other No blank or block the rule clause inadvertence ence clause.” Tri-State’s space was states that rate and specifies the released higher, a declaring use for Rohner’s shipper de- unless apply will such rate increas- purposes of valuation for alternate clares otherwise. ion, 2 & 3. 1120 nn. Opin- at id. Panel provisions cited 5. These are liability, of the level the carrier’s (decreasing limitation ing the B.O.L.’s with the carrier’s tar carrier. of Tri-State liability) iffs is core concern. As there is no Interpretation B. question but that Tri-State maintained a interpreting a case of simply a Were this prescribed guide tariff within the I.C.C. duly signed by autho- agreement bilateral lines and that Tri-State issued its B.O.L. to contracting parties, we agents rized receipt prior moving Rohner as a of the B.O.L. might provisions find the well shipment, obviously passed Tri-State liability of the carri- to limit the sufficient first and Hughes fourth test. case; rather we is But this not such er. question Thus the is em before this court goods in shipment of dealing are with the bodied the second third and elements im- commerce. The strictures interstate gave test: whether Tri-State take the Congress the I.C.C. posed by opportunity reasonable to choose of common the realm instant case out of between or more of liability, two levels interpretation subject law contractual agreement obtained Rohner’s as to its statutory regulatory inter- it to federal liability. The choice of adopted Carmack it When pretation. inextricably intertwined with a reasonable years ago, eighty-five Con- Amendment choose, opportunity point to so the focal public policy against expressed a gress inquiry prof our is whether Tri-State’s by carriers. abso- limitation gave B.O.L. fered “reasonable softened prohibition limitation was lute opportunity choose or more to between two Congress adopted the slightly so ever when liability.”6 levels Amendment, admitting a nar- Cummings public policy. to Our exception row that Compliance D. The B.O.L.’s with Tri- today is to determine whether task Tariffs exception. complied with State Although it is axiomatic that a may strictly comply B.O.L. either with Opportuni- Testing C. a Reasonable for comply, totally tariff or fail to carrier’s ty Shipper Choose for possibility—substantial is a third there public policy, any exception Like compliance. Opinion The Panel stated that wrought Cummings Amend by one not on this “[ajlthough this court has ruled narrowly. Only ment must be construed issue, precise it and others have enforced following by the rules by established (rather lading substantially bills liability. And may a limit its I.C.C. strictly) comply their related tar than with rules, above, require as 7 those noted doubt, any we iffs.” Lest there remain use filing by the carrier and the tariffs in Panel confirm the conclusion voiced agreement—here the of a written B.O.L.— substantially Opinion that a B.O.L. that provisions of the complies with sup complies with its related tariff. liability to port of the limitation carrier’s as would the same B.O.L. Opinion Panel that in the same extent agree We with the compliance tar it strict with such every case under the were limitation of Therefore, legal remaining exception, iffs. sole Cummings the scrutinized trans- ten us is whether the B.O.L. the four- issue before must be tested under action signed Rohner’s It that in dered Tri-State Hughes test. follows pronged (a) strictly com cases, of Rohner great agent those which as behalf majority of (c) (b) complied, plied, substantially comprise an isolated transaction here comply, with Tri-State’s tariffs. pre-printed failed a carrier uses own conclude, did district court and agreement as and as We B.O.L. as the dissent, subject that the B.O.L. signed shipper’s panel evidence of the Cir.1984), Transp. Co. v. United Hughes, and Strickland F.2d at 1415. 6. 829 (5th States, Cir.1964)). 334 F.2d (citing examples Robinson 923 F.2d at 1121 Inc., (6th Smith, Ralph G. F.2d agent, simply employee or have substantially complied shipper’s neither complianceof the bearing on substantial no tariffs. Tri-State’s with its tariffs nor with the with B.O.L. carrier’s for sum- motion Rohner’s granting In of the third second correctly district court mary judgment, test. opportunity “reasonable approached testing by objectively question choose” with Tri-State and agree with We compliance with its B.O.L. Tri-State’s compli substantial majority that compared The court filed tariffs. solely or fall on whether does not rise ance found, correctly tariffs and with printed is or is not clause the inadvertence Lading believe, Bill of “Tri-State’s we merely that is one type. But boldface substantially with the comply even fails to list of lengthy, item on a non-exclusive not did Properly, tariff.” test the courts should against which indicia require did at but require strict compliance with the compliance. least substantial case, B.O.L. came Tri-State’s the instant objective determination An inadvertence woefully lacking up —its strictly or sub whether, facially, the B.O.L. type, printed not boldface was clause is the the tariff stantially sample con of the a truncated version was as the in a case such question threshold tariff, off in an was not set tained suggest that We now consider. one we box, printed in a not block or enclosed followed awry when it majority went size, type distinctively large or small herring” “red Tri-State’s inconspicuously between was located be con element to shipper as an of the description weight box determining the issue sidered shipped and the block goods to be pur compliance for B.O.L.’s substantial signature. The shipper’s opportunity” the “reasonable poses of reference to limi contained no other B.O.L. Hughes test. prong of the and, importantly, it liability, more of tation the majority reversed panel When the block, box, space other no or contained finding that Tri-State’s court’s district shipper might insert a different the which substantially neither B.O.L. valuation, alternate released declared lacked thus and complied its tariffs with date, rate, or other information signature, panel requires, the that fairness the notice of a shipper’s a dif to substantiate however, ap is not “[t]hat, reasoned release rate. ferent shipper’s considering the without parent court, find that Tri- we Like This is mind.”8 state of sophistication and substantially comply, did not B.O.L. State’s part company with we point at which the posted strictly comply, with its less much Car- the majority. Under that determi- tariffs. When published and scheme, gate narrow mack/Cummings made in a case nation is routine must to be pass through which us—a “one shot” such as the one before liability is the one eligible of for limitation properly a carrier with which transaction acceptable tariffs by I.C.C.: prescribed standard, presents one of its posted I.C.C., coupled with a filed with the shipper merely to a who printed B.O.L.s That narrow the tariff. with carrier “signs on the dotted line”—the fails to the swings open gate never Hughes prongs third of the second and not determined objectively whose B.O.L. is given not been a shipper The has test: substantially, with its comply, at least to choose between opportunity reasonable or other sophistication tariff. To consider liability, so it more levels of follows two testing parties qualities subjective obtained any agreement purportedly compliance is to the B.O.L. for substantial its choice as to from and the tariff scheme subsume I.C.C. is agent signs B.O.L. worth- subjective quali when test as well. Hughes circumstances, ques- those of the less. Under those particularly shipper, of the ties Id. at 1122. the scheme mandat- integrity of point; the subjective other sophistication or tions by the Congress implemented and by ed are never reached. parties of the qualities Cummings If the paramount. I.C.C. third and second To administer long- exception to narrow Amendment’s basis on the test of the of limita- statutory proscription standing parties, such of the subjective qualities transmuted is now to be tion task is court’s when sophistication, exception broad, freewheeling a into —one not that does a B.O.L. whether determine prohibition essentially emasculates might inbe its tariff comply with strictly decided on a every case be forces toMore is error. substantial fact-intensive, basis—it is individual highly situation a if this even were point, not the courts to make Congress and state sophistication shipper’s change public policy. sweeping such not), (which it is relevant mind were of the sophistication testing the III. experi- sophistication examining the hap- employee who particular ence CONCLUSION consid- then under sign pens to reasons, foregoing we AFFIRM For error. be eration would summary grant of a district court’s under not holding, we should In so against Rohner and judgment favor distinctively differ that, say stood to Tri-State, this case and REMAND other patterns, ent fact disposition consistent final district shipper and subjective attributes opinion. with subject of proper not be faced with simply not are inquiry. We GARWOOD, Judge, with whom Circuit cases findWe here. such situation joins, JONES, Judge, H. Circuit EDITH majority inapposite by the relied on dissenting: in those factual situations because the instant from distinguishable opinion majority are difficulty cases transaction. shipper/carrier statutory “plain grounded vanilla” it is not is that incorporate redundancy, we In avoidance language. juris of that the discussion reference scheme, a motor statutory Under dissent.9 forth prudence set liability for its to limit is carrier authorized liability by limit its carrier to permit a To to the shipment damages goods fa- shipper a B.O.L. which furnishing a value, pro- shipper declared amount substantially com- cially neither following three condi- only vided tariff, be- simply carrier’s plies with the are met: tions agent is shipper’s shipper or the cause a “written declaration be (1) there must sophisticated or experienced to be found agreement” “a shipper” or written render industry, be would value; liability limited specifying the and re- intentionally objective nugatory the tariff establish- a filed be (2) there must liability that of limitation law strictive value; liability the limited a rate for ing aas matter maintained Congress has “value would that the (3) required it is That many decades. lo these policy public sur the circumstances reasonable under a be may produce a windfall given case a transportation.”1 rounding the carrier is not for a loss shipper or a sur- the circumstances under reasonable Id. at 1125-26. transportation_” rounding the part: provides in relevant 10730 § U.S.C. 1. 49 ... “(b)(1) motor common [A] ... “(a) Commission Interstate Commerce chapter provisions of this subject may, a ... require or authorize carrier, respect motor (including, ato property transportation of rates for establish under which requirements of section general tariff of the carrier title), rates for establish a value property limited to established is that by (other property than house- transportation of by shipper, or a declaration of written goods) which the hold value would agreement, when written higher declared shipper in a (nor regula- to write any statute Nothing in the it to value, tariff called for as the carrier’s us) referenced says that the cited to tion agreement must be or have. declaration written specified in form lading, or a a bill

either immedi- simple suit between the This is a Indeed, majority opinion a ship- and carrier —to parties shipper ate — such that there is no recognizes implicitly lading. nonnegotiable bill of on a ment requirement. presented. Nothing more is involved or for the nevertheless holds majority case, wholly it seems such a unremarkable ground of law on a matter express as to the clear and to hold someone require law failed the case does agreement, his written terms of “a reason shipper have had that the ment expressly is authorized not violate or between two opportunity to choose able statute, party sophis- when that liability.” Hughes v. United more levels agreement ticated understands (7th 1407, 1415 Lines, Inc., 829 F.2d Van to him. options available 913, denied, Cir.1987), 485 U.S. cert. language, any nor statutory Neither the (1988). This 99 L.Ed.2d S.Ct. majority, reported decision cited on the obviously rests requirement judicial Accordingly, contrary holding. support its limited value that the statutory provision respectfully I dissent. circumstances under the reasonable “be re transportation.” That surrounding the

quirement, to which rele potential has obvious absence al

vance, fairly cannot be understood specified mandating particular some

ways necessary declaration written

form for agreement. America, UNITED STATES lading, signed by the the bill of Here Plaintiff-Appellee, clear and ex- agent, contained a shipper’s the declared stating press provision VONTSTEEN, Skip Gerald a/k/a $5,000 the carri- ton and that value Defendant- Vontsteen greater limited unless a liability was so er’s Appellant. ap- provision This declared. were value place immediately above the peared almost No. 89-2745. signature on the bill of shipper’s Appeals, States Court of United majority held that lading. The Fifth Circuit. shipper would be commercial sophisticated, he knew or language if by this bound 7, 1992. Jan. declare a that he could have known should (and correspondingly pay a higher value rate), notwithstanding that the bill

higher special for blank lading did not have 11707(a)(1) provides property freight § 49 U.S.C. for forwarder for such damage property, written a value established for is limited to agree- 11707(c) or written provides part: declaration in relevant § freight forwarder "(c)(1) ment between freight for- A common carrier and be reasonable if that value would may exempt from not limit or be warder surrounding the the circumstances under (a) liability imposed of this under subsection transportation.” except subsec- section 10762(a)(1) provides in relevant § U.S.C. tion. ... publish shall part: "A motor common carrier containing the Commission file with "(4) its liabili- limit A common carrier may provide un- transportation it rates transported injury property ty loss or may pre- The Commission this subtitle. der of this title.” section 10730 common that motor other information scribe in their tariffs.” shall include carriers

Case Details

Case Name: Rohner Gehrig Company, Inc. v. Tri-State Motor Transit

Court Name: Court of Appeals for the Fifth Circuit

Date Published: Jan 7, 1992

Citation: 950 F.2d 1079

Docket Number: 89-6246

Court Abbreviation: 5th Cir.