The second Cummins Amendment (August 9, 1916, c. 301, 39 Stat.
441), authorizing carriers to limit liability upon property
received for transportation to the value declared in writing by the
shipper, where the rates are based on such value pursuant to
authority from the Interstate Commerce Commission,
held
applicable, and controlling the state law, in respect of a claim
for damage to goods
Page 267 U. S. 428
shipped intrastate between two points in Texas subject to tariff
and classification adopted by the carrier pursuant to an order of
the Commission requiring the carrier to remove discrimination
against interstate commerce resulting from lower intrastate rates.
Shreveport Case, 234 U. S. 342. P.
267 U. S.
430.
248 S.W. 816 reversed.
Error to a judgment of the Court of Civil Appeals of Texas
sustaining a recovery from the receivers of the Railway for damages
to goods shipped.
MR. CHIEF JUSTICE TAFT delivered the opinion of the Court.
This was a suit for damages in the County Court of Eastland
County, Texas, by the defendants in error, partners as the Cisco
Furniture Company, to recover from the plaintiffs in error, the
receivers of the Texas & Pacific Railway, $198 for injury to
two rugs and to three chairs shipped by the Furniture Company from
Fort Worth, Texas, over the railway to Cisco, Texas, and $20 for
attorney's fees exacted by a state statute for the delay of the
railway in allowing and paying the claim. The real issue here is
whether the amount of the damages for the admitted injury should be
measured by the statutory law of Texas or by the regulations of the
Interstate Commerce Commission with respect to the classification
of traffic and fixing of rates as directed by it in accordance with
the decree by the Commerce Court of the United States, affirmed by
this Court in
Houston East & West Texas Railway Co. v.
United States, 234 U. S. 342,
known as the
Shreveport Case. The damage to the chairs is
not involved. The question arises only as to the two rugs. The
transportation
Page 267 U. S. 429
began at Fort Worth, Texas, and ended at Cisco, Texas. It was
carried on under a bill of lading according to the forms of the
Interstate Commerce Commission, which provided that the rates
should be 70 cents per 100 pounds on rugs classified as not
exceeding in value $75. The bill of lading was stamped with the
following notation: "Valuation on rugs less than $75 per 100
pounds." The rugs in the transit were much damaged by acid, and
were said to be worth but $5 apiece after the damage. The shippers
claim that their value when shipped was $95 apiece. Under the
valuation noted on the bill of lading, their value could not have
exceeded $60, because each rug weighed 40 pounds.
The Texas Court of Civil Appeals, which was the highest court to
which the case could be brought, because the Supreme Court of Texas
held that it had no jurisdiction, relied upon Article 708 of the
Revised Statutes of Texas, which provides that railroad companies
within the state shall not limit or restrict their liability as it
existed at common law by any general or special notice or by
inserting exceptions in the bill of lading, or by memorandum given
upon the receipt of the goods for transportation or in any other
manner, and that any such special agreement shall be invalid. These
rugs were shipped March 13, 1920, after the second Cummins
Amendment to the Interstate Commerce Act (Act Aug. 9, 1916, 39
Stat. 441, c. 301), which permits to carriers a limitation of
liability upon property received for transportation concerning
which the carrier shall have been authorized by order of the
Interstate Commerce Commission to establish and maintain rates
dependent upon the value declared in writing by the shipper, or
agreed upon in writing as the release value of the property. In
such a case, such declaration or agreement shall have no other
effect than to limit liability and recovery to an amount not
exceeding the value so declared or released.
Page 267 U. S. 430
The writ of error is brought here under ยง 237 of the Judicial
Code, on the ground that this order of the Interstate Commerce
Commission fixing the classification and rates thereunder in an
authority exercised under the United States which by the contention
of the shippers was drawn in question and its validity denied by
the state court.
Champion Lumber Co. v. Fisher,
227 U. S. 445,
227 U. S. 451.
It is not disputed, therefore, that, if the order of the Interstate
Commerce Commission and the Western Classification No. 56 apply,
the judgment of the Court of Civil Appeals of Texas should be
reversed; if Article 708, R.S. of Texas, applies, the judgment
should be affirmed.
The
Shreveport Case began by an application of railway
carriers running west from Shreveport across the Texas state line
to Houston and Dallas to set aside an order of the Interstate
Commerce Commission on the ground that it exceeded its authority.
The order was made in a proceeding initiated by the Railroad
Commission of Louisiana before the Commission. The complaint in
that proceeding was that the carriers maintained unreasonable rates
from Shreveport, Louisiana, to various points in Texas, and that
the carriers, in the adjustment of their rates over their
respective lines, discriminated in favor of traffic within the
State of Texas and against similar traffic between Shreveport and
Texas points, that Shreveport competed in business with Houston and
Dallas, and that the rates from Dallas and Houston east to
intermediate points in Texas were much less according to distance
than from Shreveport westward to the same points with conditions
similar in all respects. The difference was substantial, and
injuriously affected the commerce of Shreveport. The Commission
found that interstate rates out of Shreveport to main Texas points
were unreasonable, and it fixed maximum rates for that traffic. It
also found that the rates from Houston and Dallas
Page 267 U. S. 431
eastward to Texas points were so low as to be a discrimination
and an undue and unlawful preference against Shreveport and against
its interstate commerce. Accordingly, the carriers were directed to
desist from charging higher rates from Shreveport to Dallas and
Houston, respectively, and intermediate points than were
contemporaneously charged for the same carriage from Dallas and
Houston to Shreveport for equal distances. The Commerce Court
sustained the order, and so did this Court, leaving it to the
railroad company to bring about the equality required either by
decreasing the rates from Shreveport to the Texas points between
that city and Dallas and Houston, or by increasing the intrastate
rates from Houston and Dallas eastward to the Texas points between
those cities and Shreveport. This Western Classification which the
carrier applied in this case was adopted by the railroads under the
authority of the Interstate Commerce Commission thus sustained in
the
Shreveport Case. That authority rested on the
supremacy of Federal authority in respect to interstate commerce.
The intrastate rates fixed by the Texas State Railway Commission
from Houston and Dallas eastward to Texas points were a
discrimination against the interstate traffic between Shreveport
and those same points, and therefore it was held to be within the
power of the Interstate Commerce Commission in preventing such
unlawful discrimination under the Interstate Commerce Act to direct
the railways to ignore the Texas Commission rates and to establish
rates, not unduly discriminating against interstate commerce, in
intrastate traffic. Such an order, of course, included
classification, as well as rates. The two are so bound together in
the regulation of interstate commerce that the effect of both must
be reasonable, and without undue discrimination. The Interstate
Commerce Commission therefore had full authority to issue this
order for the adoption of the Western Classification
Page 267 U. S. 432
for intrastate points between Houston and Cisco, both in Texas.
The conflict between the revised statutes of Texas and the order of
the Interstate Commerce Commission can only be settled by
recognition of the supremacy of the federal authority. It is plain
from the agreed statements of facts that the only recovery which
could be had under the Western Classification in this case was less
than $60. The limitation of liability was in accordance with the
second Cummins Amendment, was properly agreed to, and was binding
upon the shipper as well as the carrier.
The judgment of the Court of Civil Appeals must be reversed, and
the cause remanded for further proceedings not inconsistent with
this opinion.