1. A State court decision interpreting clauses of a uniform bill
of lading prescribed by the Interstate Commerce Commission under
authority of the Interstate Commerce Act, in a suit by a carrier to
recover charges for an interstate shipment, is reviewable here by
certiorari under Jud.Code § 237(b). P. 320 U. S.
2. The consignor of an interstate shipment upon uniform bill of
lading stipulated that charges were "to be prepaid," and also
signed the "non-recourse" clause. Because of the manner in which
the shipment was handled by the consignee upon delivery, a higher
rate than that specified in the bill of lading became applicable.
that the carrier was not entitled to recover the
additional charges from the consignor. P. 320 U. S.
With respect to the charges here, the prepayment clause did not,
either by its design or by the intention of the parties, curtail
the operation of the "non-recourse" clause. P. 320 U. S.
3. A carrier may insure collection of unanticipated freight
charges by demanding, pursuant to § 7 of the conditions of the
uniform bill of lading, the consignor's guarantee of all charges.
P. 320 U. S.
316 Ill.App. 516, 46 N.E.2d 144, reversed.
p. 721, to review a judgment which
reversed a judgment for the defendant in a suit to recover freight
charges. Leave to appeal to the highest court of the State was
denied by that court.
MR. CHIEF JUSTICE STONE delivered the opinion of the Court.
Decision in this case turns on the proper interpretation to be
given to several clauses of the uniform bill of lading
Page 320 U. S. 509
approved by the Interstate Commerce Commission as authorized by
§§ 1(6), 12, and 15(1) of the Interstate Commerce Act, as amended,
49 U.S.C. §§ 1(6), 12, 15(1), which make it the duty of interstate
rail carriers to adopt and observe the form and substance of bills
of lading approved by the Commission. Matter of Bills of
52 I.C.C. 671, 685, 686; 64 I.C.C. 347, 351, 352; 64
I.C.C. 357; 66 I.C.C. 63; 167 I.C.C. 214; 172 I.C.C. 362; 245
Petitioner was the consignor upon through bills of lading of a
number of rail shipments of sulphate of ammonia for export. The
shipments were from Gary, Indiana, to Baltimore, Maryland, over the
lines of connecting railroads, of which respondent was the terminal
carrier. Each bill of lading [Footnote 1
] contained a clause, inserted by petitioner,
the consignor, in conformity to instructions appearing on the bill,
and providing that freight was "to be prepaid," and also the
so-called non-recourse clause, which petitioner signed and which
"If this shipment is to be delivered to the consignee without
recourse on the consignor, the consignor shall sign the following
statement: The carrier shall not make delivery of this shipment
without payment of freight and all other lawful charges. (See
Section 7 of conditions.) [Footnote
Petitioner, at shipment, paid the freight charges specified in
the bills of lading, which were computed at the export freight
rate. The bills of lading included a receipt for specified sums
Page 320 U. S. 510
to the carrier "to apply in prepayment of the charges." The
record does not disclose who was the owner of the sulphate or what
further relations existed between consignor and consignee.
The parties concede that, upon delivery of the shipments at
Baltimore, the consignee did not handle the sulphate as required by
the provisions of the export tariff, and that the delivery or the
method of handling subjected the shipments to the higher domestic
freight rate. The parties have also stipulated that respondent is
entitled to recover from petitioner additional freight charges to
the extent of the difference between the export rate and the higher
domestic rate unless recovery is barred by the clauses of the bills
of lading to which we have referred.
Respondent brought the present suit in the Illinois Superior
Court to recover the additional freight due upon the shipments. The
Superior Court gave judgment for petitioner, which the Illinois
Appellate Court reversed, 316 Ill.App. 516, 46 N.E.2d 144, and the
Illinois Supreme Court denied leave to appeal. We granted
certiorari, 320 U.S. 721, the interpretation of the uniform bill of
lading in the circumstances of this case being a question of public
Pursuant to Congressional authority, the Interstate Commerce
Commission has prescribed uniform forms of bills of lading,
including that involved in this case. Matter of Bills of
In promulgating them, the Commission has stated
that it was doing so in the interest of uniformity and to prevent
discriminations. 52 I.C.C. 671, 676, 677, 678; 64 I.C.C. 357, 363,
364. It has found that the prescribed forms are just and
reasonable, 52 I.C.C. 671, 740, and that any other would be
unreasonable, 64 I.C.C. 357, 360, 361, 364.
The construction of the clauses of a bill of lading, adopted by
the Commission and prescribed by Congress for interstate rail
shipments, presents a federal question.
Page 320 U. S. 511
Georgia, F. & A. Ry. Co. v. Blish Milling Co.,
241 U. S. 190
241 U. S.
-195; Chesapeake & Ohio R. Co. v.
Martin, 283 U. S. 209
283 U. S.
-213. Such has been the consistent ruling of this
Court where the question presented concerned the conditions in
bills of lading affecting the liability of the carrier such as are
required by the Carmack Amendment, as amended, 49 U.S.C. § 20(11).
Georgia, F. & A. Ry. Co. v. Blish Milling Co., supra;
Atchison, T. & S.F. Ry. Co. v. Harold, 241 U.
; St. Louis, I.M. & S. Ry. Co. v.
Starbird, 243 U. S. 592
Gulf, C. & S.F. Ry. Co. v. Texas Packing Co.,
244 U. S. 31
244 U. S. 34
American Railway Express Co. v. Lindenburg, 260 U.
; Chesapeake & Ohio Ry. Co. v. Martin,
supra; cf. Peyton v. Railway Express Agency, 316 U.
Since the clauses of the uniform bill of lading govern the
rights of the parties to an interstate shipment and are prescribed
by Congress and the Commission in the exercise of the commerce
power, they have the force of federal law, and questions as to
their meaning arise under the laws and Constitution of the United
States. Hence, we have jurisdiction to review their determination
by the state courts in a suit by the carrier to recover freight
charges. Judicial Code § 237(b), 28 U.S.C. § 344(b);
Pittsburgh, C., C. & St.L. Ry. Co. v. Fink,
250 U. S. 577
250 U. S.
-583; New York Central & H. R. Co. v. York
& Whitney Co., 256 U. S. 406
256 U. S. 408
cf. Sola Electric Co. v. Jefferson Co., 317 U.
, 317 U. S.
-177; Peyton v. Railway Express Agency, supra;
Southern Railway Co. v. Prescott, 240 U.
, 240 U.S.
The shipments by petitioner being in interstate commerce, the
rail freight rates are those stated in the tariffs filed with the
Interstate Commerce Commission. They cannot be lawfully released by
the carrier or altered by others who have assumed the duty to pay
them. See Midstate Horticultural Co., Inc. v. Pennsylvania R.
p. 320 U. S. 356
Pittsburgh, C., C. & St.L. R. Co. v. Fink, supra,
Page 320 U. S. 512
250 U. S.
-583. The tariffs do not prescribe who is to pay the
freight charges, but, subject to the prohibition against unlawful
discrimination. and the limitations imposed by the uniform bill of
lading, the parties to the shipment, as between themselves, are
free to stipulate who shall pay them. See Louisville &
Nashville R. Co. Co. v. Central Iron Co., 265 U. S.
, 265 U. S.
Section 7 of the conditions of the uniform bill of lading
provides that the owner or consignee shall pay the freight and all
other lawful charges upon the transported property, and, except in
those instances where it may be lawfully authorized to do so, that
no railroad carrier shall deliver or relinquish, at destination,
possession of the property covered by the bill of lading until all
tariff rates and charges have been paid. Cf.
§ 3(2) of the
Interstate Commerce Act, as amended, 49 U.S.C. § 3(2). But it
further provides that
"The consignor shall be liable for the freight and all other
lawful charges, except that, if the consignor stipulates, by
signature, in the space provided for that purpose on the face of
this bill of lading that the carrier shall not make delivery
without requiring payment of such charges, and the carrier,
contrary to such stipulation, shall make delivery without requiring
such payment, the consignor (except as hereinafter provided
]) shall not be
liable for such charges. . . . Nothing herein shall limit the right
of the carrier to require at time of shipment the prepayment or
guarantee of the charges. . . . "
Page 320 U. S. 513
Under these provisions, if the non-recourse clause is not signed
by the consignor, he remains liable to the carrier for all lawful
charges. The carrier is free to demand payment in advance by the
consignor, or it may decline to make delivery to the consignee
until the freight charges are paid or guaranteed, or, if delivery
is made to the consignee without payment, the consignee is also
liable for all freight charges. But if the non-recourse clause is
signed by the consignor and no provision is made for prepayment of
freight, delivery of the shipment to the consignee relieves the
consignor of liability, see Louisville & Nashville R. Co.
Co. v. Central Iron Co., supra, 265 U. S. 66
note 3, and acceptance of the delivery establishes the liability of
the consignee to pay all freight charges. Pittsburgh, C., C.
& St.L. Ry. Co. v. Fink, supra; New York Central & H. R.
Co. v. York & Whitney Co., supra.
In the light of these long established rules of liability, the
facts of the present case raise only a single question -- whether
the stipulation in the bills of lading for the prepayment of
freight restricts the operation of the non-recourse clause, so
that, despite its presence in the bills of lading, recourse may be
had to petitioner for charges in addition to those which it prepaid
at shipment, the additional charges arising only by reason of
events which occurred on or after the delivery of the shipments to
The Illinois Appellate Court thought, and respondent argues
here, that this liability was imposed on the consignor only because
the prepayment clause was so in conflict with the non-recourse
clause as to nullify the latter, and thus revive the obligation
which, in the absence of that clause, rests on the consignor to pay
all lawful charges on his shipments. The question is whether there
is such a conflict as to require this result. For we must assume
that both clauses were intended by the parties to have some effect,
and hence, unless unavoidably in conflict, they
Page 320 U. S. 514
must, so far as they reasonably may, be reconciled so that each
will have some scope for operation.
The obvious purpose and effect of the non-recourse clause is to
relieve the shipper from liability for freight charges upon
delivery to the consignee. Such a purpose is consistent with an
intention that, in case of prepayment of a portion of the freight
charge, the carrier should, after delivery, look solely to the
consignee for the remainder of the charge. Since, by the uniform
bill of lading, the parties to a rail shipment are left free to
relieve the consignor from liability by their contract, such an
arrangement would be within their competence, and would release the
consignor from liability to the extent of the unpaid freight
It could not be said that, by agreeing to pay a part of the
charges in advance, the consignor has agreed to pay more, or that
the non-recourse clause would cease to be effective as to the
unpaid charges because the consignor had paid or undertaken to pay
some of them. The words of § 7 of the conditions of the bill of
lading are to the effect that, if the consignor stipulates that the
carrier shall not deliver "without requiring payment of such
charges" and the carrier makes delivery, the consignor "shall not
be liable for such charges." In this context, "such charges" are
the lawful charges which the consignor has not paid or stipulated
to pay in advance.
We discern no policy underlying the uniform bill of lading or in
the provisions of § 7 which would deny the application of the
non-recourse clause where the consignor has stipulated for advance
payment of some, but less than all, of the lawful charges. And no
plausible reason is advanced why an agreement by the consignor to
pay a part of the lawful charges should be deemed to deprive him of
the benefit of the non-recourse clause beyond the amount he has
undertaken to pay.
Page 320 U. S. 515
We think that the same considerations point here to the
reconciliation of the conflict which the Illinois court thought to
exist in this case. For, in the present circumstances, we cannot
say that the prepayment clause contemplated payment by the
consignor of the additional charges demanded at the domestic tariff
rate, and hence we find no irreconcilable conflict between the
prepayment and non-recourse clauses.
Petitioner's stipulation was that the freight charges were "to
be prepaid," and the bill of lading acknowledged receipt of
specified sums "to apply in prepayment of the charges." Hence, the
stipulation was for an obligation to be performed in advance of the
transportation, or, at the most, in advance of delivery to the
consignee. This obligation could not have contemplated payment of
more than all the lawful charges upon the consignor's shipment as
tendered and transported in conformity to the billing. No more
could prepayment be made, before either shipment or delivery, of a
charge which might never be incurred and which could be only after
the transportation was completed and delivery made to the
It is familiar experience, as in this case, that undercharges
may occur which could not be subject to prepayment, either because
they are not lawful charges on the shipment as tendered and billed
or because they depend upon events occurring after the
transportation has been completed. In either case, we conclude that
the reasonable construction of the prepayment clause is that, with
respect to these charges, it did not, either by its design or by
the intention of the parties, curtail the operation of the
non-recourse clause so as to deprive petitioner, the consignor, of
the immunity from liability for which it was entitled to stipulate
by the non-recourse clause. See Chicago Great Western R. Co. v.
Hopkins, 48 F. Supp.
. This construction does not leave the carrier unprotected
with respect to the collection of unanticipated
Page 320 U. S. 516
freight charges, for it may always insure their collection by
demanding the consignor's guarantee of all charges, pursuant to § 7
of the conditions of the uniform bill of lading, a provision which
presupposes that the prepayment of freight clause is not as broad
as the authorized guarantee.
In the special circumstances of this case, we have no occasion
to consider the broader contention of petitioner that the
prepayment clause contemplated an undertaking upon its part to pay
only the amount of freight charges specified on the face of the
bill of lading, whether or not they were computed at the lawful
rate on the shipments as tendered and billed.
MR. JUSTICE ROBERTS concurs in the result.
Specimen forms of the uniform bills of lading, prescribed for
interstate rail shipments during the period when the shipments
concerned in this action were made, may be found in Consolidated
Freight Classification No. 7 (1932) pp. 52-56.
Section 7 of the conditions of the bill of lading, so far as
relevant, is set out at page 320 U. S. 512
The parties have stipulated that the non-recourse
clause contained in the bills of lading in this case were in the
form quoted in the text. The form approved by the Commission varies
slightly in details immaterial here. See
Freight Classification No. 7, supra,
The exception, inapplicable here, is in the case where a
consignee, other than the consignor, is an agent with no beneficial
title in the goods, and has notified the carrier of these facts. In
such a case, the consignee is not
"liable for transportation charges . . . (beyond those billed
against him at the time of delivery for which he is otherwise
liable) which may be found to be due after the property has been
delivered to him,"
but the consignor is liable for such charges. Cf.
3(2) of the Interstate Commerce Act, as amended, 49 U.S.C. §