PAYNE v. ROGERS

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Docket Number

Nos. 4123, 4124.

Attorney(S)

Henry G. Binns, of Columbus, Ohio, for receiver. Webb. I. Vorys, of Columbus, Ohio (Vorys, Sater, Seymour Pease, of Columbus, Ohio, on the brief), for Payne.

Judges

Maurice H. Donahue
Loyal Edwin Knappen

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Smart Summary

Factual and Procedural Background

The action was brought by John Barton Payne, Director General of Railroads (later succeeded by James C. Davis), against J.F. Rogers, receiver of the Dodson Sawmill Lumber Company, to recover $3,731.87 plus interest for storage charges on eight carloads of lumber stored on railroad property from October 13, 1919, to February 29, 1920. The charges were claimed under a schedule of uniform tariffs filed with the Interstate Commerce Commission governing storage rules and charges.

The defendant demurred generally and to each item of the account, which was overruled. The defendant admitted the shipment of seven carloads but contended the lumber was not liable to damage from the elements and was stored on vacant railroad land pending shipment at the owner's risk, under a tariff provision allowing free storage under such conditions if space had been assigned. The plaintiff replied that the permission for free storage had been revoked by October 13, 1919, and no free storage space was then assigned or occupied by the Dodson Company.

At trial, evidence showed the Dodson Company had assigned space and stored lumber there, but after a request by the railroad agent to remove the lumber, the company failed to do so. The agent sent a notice on October 13 warning that lumber not removed would be subject to storage charges at tariff rates. Both parties moved for a directed verdict, and the court directed a verdict for the Director General for $1,502.25. Both parties appealed.

Legal Issues Presented

Whether the District Court had jurisdiction to hear the cause of action without prior resort to the Interstate Commerce Commission.
The proper construction and applicability of the tariff schedule governing storage charges for the lumber stored on railroad property.
Whether the tariff schedule fixed a storage charge applicable to the type of freight and storage involved in this case.

Arguments of the Parties

Receiver's Arguments

The District Court lacked jurisdiction because the plaintiff failed to first seek relief from the Interstate Commerce Commission.
The lumber was not liable to damage from the elements and was stored on vacant railroad land pending shipment at the owner's risk, thus entitled to free storage under the tariff provision.

Plaintiff's Arguments

The amended petition stated a cause of action properly before the court without administrative discretion or factual questions requiring ICC intervention.
The permission for free storage had been revoked by October 13, 1919, and no free storage space was assigned or occupied by Dodson at that time.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Great Northern Ry. Co. et al. v. Merchants' Elevator Co., 259 U.S. 285, 295-296 (1922)	Jurisdiction of federal courts over tariff claims not requiring administrative discretion or factual determinations.	The court held that the demurrer to the petition was properly overruled because the cause of action was stated on its face as a claim for fixed tariff charges, involving no administrative discretion.

Court's Reasoning and Analysis

The court first addressed the receiver's jurisdictional challenge, finding that because the amended petition sought recovery of fixed storage charges under a filed uniform tariff and did not involve questions of administrative discretion or factual interpretation, the District Court had jurisdiction without prior ICC proceedings.

However, the court then analyzed the tariff schedule itself and found that it did not fix storage charges applicable to coarse freight such as lumber stored on vacant railroad land. The tariff’s storage charges were intended for freight of higher value, liable to damage, stored at the carrier’s risk in warehouses or public warehouses.

The tariff included a note providing free storage for freight not liable to damage and not handled through freighthouses, when stored on vacant railroad land at the owner's risk and with assigned space. Since the lumber in question fell into this category and the tariff fixed no charge for such storage, the court concluded the tariff did not authorize the storage charges claimed.

Because the suit was based entirely on tariff charges, the court reversed the judgment. The court expressly declined to decide whether recovery might be had for use and occupation after revocation of permission or whether the shipper could seek ICC relief for discrimination claims.

Holding and Implications

REVERSED AND REMANDED.

The court reversed the District Court's judgment awarding storage charges under the tariff because the tariff did not fix a storage charge applicable to the type of freight and storage involved. The case was remanded for further proceedings consistent with this ruling. This decision directly affects the parties by denying recovery under the tariff but does not establish new precedent on issues such as recovery for use and occupation or ICC claims for discrimination.

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PAYNE, Director General of Railroads, v. ROGERS. ROGERS

PER CURIAM.

It is claimed on behalf of the receiver that the court erred in overruling his demurrer to the amended petition, for the reason that the District Court had no jurisdiction of the cause of action without previous resort to the Interstate Commerce Commission. The amended petition on its face, purports to state a cause of action to recover certain fixed storage charges claimed to be due under a uniform interstate tariff promulgated and filed by the plaintiff with the Interstate Commerce Commission, involving no question of fact, either in aid of construction or in other respect, and as so stated, involves no question of administrative discretion. The demurrer was properly overruled. Great Northern Ry. Co. et al. v. Merchants' Elevator Co., 259 U.S. 285, 295, 296, 42 S. Ct. 477, 66 L. Ed. 943, and cases there cited.

The answer, the reply, and the evidence, particularly the tariff schedule, Exhibit 55, present a wholly different case from the one stated in the amended petition. The tariff schedule upon which plaintiff bases his cause of action does not in terms fix a storage charge for coarse freight of this character. On the contrary, the storage charges fixed in this tariff seem clearly to contemplate and cover only freight of larger value in proportion to bulk, liable to be damaged by the elements and required to be stored, at carrier's risk, either in the carrier's warehouse or, at the option of the carrier, may be sent to a public warehouse. For the storage of this character of freight, including additional service, care, protection, and risk, the carrier is entitled to larger storage charges than would be fair or reasonable for coarse freight to be shipped in carload lots, not intended to pass through carrier's freight-house, and not to be handled by the carrier's agents and practically impossible of being stored in a warehouse, but intended and designed to be stored on the vacant grounds of the carrier at the shipper's risk. That this is the proper construction of this tariff schedule would seem to be recognized by note to rule 1, which provides that freight, not liable to damage from the elements and not to be handled through freighthouses, may be stored free of storage charges, on vacant land of the railroad pending shipments and at owner's risk, provided owner has previously been assigned space as far as available and without distinction.

As the only tariff schedule introduced in evidence fixes no tariff rate for the storage of lumber and other freight of like character, to be shipped in carload lots and not to be stored in warehouses or moved through the carrier's freighthouse at carrier's risk, the judgment must be reversed. Inasmuch as this suit was based entirely upon a tariff, and was for the recovery of tariff charges, we do not determine whether or not, in an action for use and occupation of the ground after the revocation of the license, a recovery could be had, or what, if any, right the shipper might have to secure reparation at the hands of the Interstate Commerce Commission under a claim of discrimination based upon the revocation of the license.

Reversed and remanded.