Where not only the scope and applicability of the doctrine of
subrogation is involved, but also the extent to which a common
carrier is protected by the laws of the United States in paying
customs duties exacted thereunder on goods in transit over its
lines, a federal question is presented, which, when properly set up
in the state courts, is subject to review by this Court.
A common carrier has, under the laws of the United States, a
lien entitling it to possession until paid, on goods in transit
over its lines for legal
Page 192 U. S. 180
import duties paid thereon by it either directly to the
government or to a connecting carrier which has already paid the
same.
Where a contract of shipment, from a point without to a point
within the United States over the lines of several carriers,
provides that each carrier shall be liable only for loss or damage
accruing on its own lines, the last carrier is not responsible for
damages resulting from an examination by customs officers at a
point not on its own line, and different from the point to which
the contract provided that the goods should be delivered in
bond.
On June 25, 1895, Charles E. Pearce, the testator of the
defendants in error, commenced his action in replevin in the
Circuit Court of the City of St. Louis, Missouri, to recover from
the railroad company four boxes of curios. After answer a trial was
had before the court without a jury, resulting in a judgment for
the plaintiff which, on May 7, 1901, was affirmed by the St. Louis
Court of Appeals. 89 Mo.App. 437. An application to transfer the
case to the supreme court of the state on the ground that it
involved the validity of a statute of or authority exercised under
the United States was denied,
State ex Rel. Wabash R. Co. v.
Bland, 168 Mo. 1, and thereupon it was brought here on writ of
error.
The facts are undisputed, and are as follows: Pearce was the
owner of the curios, and in Yokohama, Japan, shipped them to St.
Louis. The bill of lading was issued by the Canadian Pacific
Railway Company, and recited that the goods were shipped upon the
company's steamer
Empress of India, to be carried to
Vancouver, British Columbia, and thence over the Canadian Pacific
and connecting lines to St. Louis, Missouri. The boxes were carried
to Vancouver and thence by the Canadian Pacific Railway Company
over its own and a connecting line controlled by it to St. Paul,
Minnesota. Upon arrival at St. Paul, the custom officers took
possession of the boxes, opened and examined the contents, and duly
assessed the duties thereon at $264.31, which sum was paid by the
railway company, and had to be paid in order to regain possession
and forward the goods. The goods were thereafter delivered to the
Chicago, Milwaukee & St. Paul Railway Company, by
Page 192 U. S. 181
it to the defendant at Given, Iowa, and by the latter carried to
St. Louis. The inspection at St. Paul was in strict accordance with
the laws of the United States, and the duties exacted were properly
chargeable upon the goods. When the defendant received the goods
from the Chicago, Milwaukee & St. Paul Railway Company, it
became responsible under its traffic agreements for the payment of
the charges then on the goods, including the custom duties, and has
since paid those charges. On receipt of the goods in St. Louis,
they were tendered to the plaintiff upon payment of the charges.
The goods were shipped in bond to St. Louis, and this was so marked
on the boxes. If they had been transported to St. Louis in bond, as
they should have been, they would there have been opened and
examined and retained in the custody and possession of the custom
officers not only during examination and inspection, but also until
the duties were paid.
Page 192 U. S. 184
MR. JUSTICE BREWER delivered the opinion of the Court.
Two questions are presented -- one of jurisdiction, and the
other on the merits.
With regard to the first, the decision of the supreme court of
the state is not controlling. It is not the province of a state
court to determine our jurisdiction, and further, the Missouri
statute, providing for a review of certain cases by the supreme
court, is not identical with but more limited than section 709,
Rev.Stat., which prescribes our jurisdiction over final judgments
of state courts.
It is contended that the only question determined by the state
court was the applicability of the equitable doctrine of
subrogation; that no statute of Congress was suggested giving a
right of subrogation in cases like this, and therefore that the
decision of the state court rested upon a matter of general law.
But the answer of the defendant, after stating the
circumstances
Page 192 U. S. 185
of the payment by the several carriers, alleged that it was
"entitled to the first lien on said goods under the laws of the
United States for the amount of said duties." Although no single
statute was mentioned, it claimed a lien on the goods under and by
virtue of the laws of the United States, and thus directly called
for a determination of a federal right.
Crowell v.
Randell, 10 Pet. 368;
Bridge
Proprietors v. Hoboken Co., 1 Wall. 116,
68 U. S. 142;
Furman v.
Nichol, 8 Wall. 44,
75 U. S. 56;
Dooley v.
Smith, 13 Wall. 604. The question in fact presented
and decided was not simply the scope and applicability of the
doctrine of subrogation, but rather to what extent, considering the
obligations cast by the revenue laws and the duties of common
carriers as between themselves and the shipper, the carrier was
protected by the laws of the United States in paying custom duties
exacted under them. When we stop to consider the great volume of
imports handled almost exclusively by common carriers, the owners
or consignees being often in the interior of the country, this is
obviously a question of supreme importance. And this question is
solved not alone upon general principles of law, but involves an
inquiry as to the effect of exactions made under authority of the
statutes of the United States. We are, by § 709, Rev.Stat., given
jurisdiction over the final judgments of state courts
"where any title, right, privilege, or immunity is claimed under
the Constitution, or any treaty or statute of, or commission held
or authority exercised under, the United States, and the decision
is against the title, right, privilege, or immunity specially set
up or claimed."
The contention of the railroad company is that payment of duties
exacted under the statutes of the United States does not operate
simply to release the goods, but also gives, in cases like the
present, to the carrier the right and privilege of maintaining
possession until it is reimbursed these duties. Is the statute to
be considered simply as a demand for money, or does it also carry a
grant to one situated as this carrier, of a right and privilege of
possession?
Page 192 U. S. 186
claimed by the railroad company. Whether it existed was the
substantial question presented and decided. And, whether rightly or
wrongly decided, the presentation of the question, the claim of the
right and privilege, was, when denied by the state court,
sufficient to give this Court jurisdiction.
We pass, therefore, to consider the merits. Do the laws of the
United States exacting the payment of duties at ports of entry
justify the carrier in paying those duties, and give to it a lien
therefor as against the owner? It must be remembered that the
government has not prescribed payment simply at the place of
delivery, but has named the ports of entry at which, and at which
only, payment can be made. Must the carrier insist that the owner
shall be present at the place of entry to himself make payment, or,
after notifying the owner, leave the goods in the hands of the
government officials to be held for the charges thereon, or, may
the carrier pay the charges, and maintain possession until
reimbursed by the owner? It is unnecessary to consider what rights
would exist if it were alleged that the goods imported were free
from duty, or that there had been overcharges or wrongful conduct
on the part of the government officials. Here, the regularity of
the proceedings on the part of the government officials and the
correct amount of the duties collected are unquestioned.
We are of opinion that the custom laws of the United States are
potent to fully protect the carrier in the payment of the legal
duties charged upon goods in its possession. In order to fully
understand the force and scope of any statute or body of statutes,
we must have regard to the conditions and circumstances for which
the legislation was intended and under which it is to become
operative. We are not narrowly to read the letter and ignore the
state of affairs to which that legislation was intended and is
applicable. As we have said, the great body of imports is subject
to duties, and payment thereof is, by statute, specifically
required to be made at certain places. These imports are brought in
by carriers, and distributed by them to the several places of
destination.
Page 192 U. S. 187
It is unnecessary to cite authorities to the proposition that it
is the common law duty of the carrier to receive, carry, and
deliver goods; that, by virtue of this obligation, it is entitled
to retain possession until its charges are paid. Nor is this lien
confined to the charges for its own transportation. The law is thus
stated in Overton on Liens, § 135, p. 166:
"The lien attaches not alone for the particular item of charge
for carriage due upon the goods, but for such other legal charges
as the carrier, in the course of his duty, may have been compelled
to expend upon their care, custody, and preservation. As when a
railway, in the transportation of livestock, as cattle, horses, and
swine, has been at expense of labor and money in feeding and
preserving them, such expense is a legitimate charge in addition to
their transportation. For the carrier is under special obligation
to guard and protect such property, hence the propriety of a lien
for such extraordinary expense and care. If a carrier, in the
ordinary course of the business, pay back charges upon goods due to
another carrier in the course of transportation, as they come to
him, he may recover for such back charges and freight so paid, and
the owner may seek his remedy for any damages done them against the
party in whose hands it was done, or under his original contract of
shipment."
See also Hutchinson on carriers § 478a; Ray on Freight
Carriers § 102. In Schouler on Bailments, p. 544, it is said:
"A common carrier, then, may usually retain particular goods, by
virtue of his lien right, until the freight and charges due thereon
for his whole transportation are paid or tendered him, and he
cannot be compelled to give them up sooner. This lien, moreover
extends to all the proper freight and storage charges upon the
goods throughout the whole of a continuous transit over successive
lines, since the last carrier or final warehouseman may advance
what was lawfully due his predecessors, and hold the property as
security for his reimbursement."
In making payment to a connecting carrier of its freight
Page 192 U. S. 188
charges the carrier is not a mere volunteer, such as is referred
to in
Aetna Life Insurance Company v. Middleport,
124 U. S. 534.
All this was matter of common knowledge, and upon this the
legislation in respect to duties was enacted. It is to be supposed
that Congress intended that protection to the carrier should depend
upon the perhaps varying opinions of the courts of the different
states as to whether, in making payment, the carrier was a mere
volunteer, or whether it can be subrogated to the rights and
remedies of the nation? It must be remembered that the importation
of goods is a subject of national, and not of state, regulation,
that such power of regulation continues until the final delivery of
the imported articles, so that over the entire transportation of
these goods to St. Louis, the place of delivery, the power of
Congress was supreme and exclusive. It must also be remembered that
bonded goods are, by § 2993, Rev.Stat., deliverable only to
carriers designated by the Secretary of the Treasury, who are made
responsible to the United States and are required to give bond to
the United States in such form and amount and with such conditions
and security as the Secretary of the Treasury shall require. Is it
not reasonable to hold that Congress, having in mind the duty of
carriers in reference to transportation and delivery, their
customary lien for charges, and their right to retain possession
during transit, in directing the custom house officers to take
goods out of a carrier's possession, inspect and hold until the
duties are paid, intended that, upon payment, the government lien
should pass to the carrier, with a view of enabling it to discharge
its duty of carriage and delivery to the consignee? It was not
necessary to specifically state that the government's lien was
transferred, for when Congress provided by statute for interrupting
the carrier's common law right of possession, it is implied that
the action necessarily taken by the carrier to regain possession
shall work no injury to the rights which flow from possession.
Such, it seems to us, is the fair import of this legislation,
enacted, as it was, in view of the
Page 192 U. S. 189
well recognized rights and duties of carriers. The defendant
should not therefore have been deprived of the possession of the
goods without a repayment of the duties.
It is insisted, however, that the goods were shipped in bond to
St. Louis, that the Canadian Pacific, for its own convenience,
wrongfully changed their bonded destination to the port of St.
Paul, and that, during the examination and inspection at St. Paul,
some of the curios were broken, and some lost, whereas if they had
been shipped in bond to St. Louis, they might have been opened and
examined in the presence of the plaintiff, and injury and loss
prevented. Conceding this, and that the Canadian Pacific, by its
wrongful act, was liable for the injuries resulting to the
plaintiff, the contract of shipment stipulated that each of the
parties employed in the carriage should be liable only for loss or
damage accruing upon its own road, and that such carriers should
not be jointly liable, nor either for any loss or damage accruing
upon the road of the other; so that whatever claim the plaintiff
may have had for such injury and loss was only against the Canadian
Pacific, and could not operate to prevent the defendant company
from receiving that which, by its payment, it was entitled to.
The judgment of the St. Louis court of appeals is reversed
and the case remanded to that court for further proceedings not
inconsistent with this opinion.
