Southern Pacific Co. v. Hyman-Michaels Co.
Southern Pacific Co. v. Hyman-Michaels Co.
Opinion of the Court
The plaintiff, Southern Pacific Company, sued to recover demurrage charges claimed to be due on 365 freight cars containing scrap iron purchased by defendant from plaintiff for overseas shipment. The cause was tried by a jury, and it returned a verdict in favor of the defendant, Plaintiff appeals from the judgment entered upon
The main grounds urged for reversal are that there was no contested issue of fact to be submitted to the determination of the jury; that the evidence established as a matter of law that the demurrage tariffs imposed by plaintiff applied to the factual situation presented, and that therefore the trial court erroneously submitted the cause to the determination of the jury; and that in any event the evidence introduced does not support the verdict. The points made by plaintiff in this behalf are not sustainable.
The circumstances out of which the controversy arises are these: For many years the defendant company was engaged in the business of purchasing large quantities of scrap iron from the western railroads for sale and shipment overseas through the port of San Francisco; and throughout the three-year period immediately preceding March, 1940, it purchased several hundred carloads from plaintiff, which defendant sold and exported to Japan. The price paid for the scrap iron by defendant included transportation “f.o.b.” Southern Pacific tracks, San Francisco. All but two of the ears here involved were loaded at plaintiff’s store yards in Oakland, Sacramento, and El Paso, and the waybills, made out by plaintiff as seller and shipper, named Southern Pacific Company as consignee, care agent for defendant, in care of a certain steamer at a designated dock. However, the Southern Pacific tracks end at Second Street and the Embarcadero; it owns no trackage along the San Francisco waterfront. All of it is owned and controlled by the Belt Line, a state railroad over which the state operates its own engines and switching crews. Consequently, in order to place the scrap iron alongside the ships to be loaded, it was necessary that the loaded ears be transferred to and taken over by the Belt Line at the end of the Southern Pacific tracks and spotted on the docks alongside the ships. The Belt Line had an established rule, which was well known both to plaintiff and defendant, that it would not take over any cars containing overseas shipments unless the ships that were to receive the cargo were not only docked but ready and free to take the cargo. The purpose of the rule was to prevent congestion on the limited trackage along the waterfront; and the delay which is the basis of the demurrage charges herein was brought about by the refusal
The demurrage tariffs assessed and sought to be collected are set forth in a schedule filed by plaintiff with and sanctioned by the California Railroad Commission and the Interstate Commerce Commission, and in cases where such tariffs apply the “free time” permitted thereunder for unloading after notice of arrival is 48 hours. The parties are agreed, however, that published railroad tariffs, whether for movement of goods or for demurrage, by their very nature, may be assessed and collected only when a shipper-carrier relationship exists; that is, when the railroad is acting as a carrier of the goods of another, and that they have no application to the transportation by the railroad of its own property. Hence there is no legal ground upon which it may be held that the car demurrage tariff in and of itself imposes liability on a purchaser from a railroad while the subject of the sale r.emains the property of the railroad and has not been delivered actually or constructively to the purchaser. The general rule is that the question of when title to goods sold passes from the seller to the buyer is one of intention between the parties (Blackwood v. Cutting Packing Co., 76 Cal. 212 [Í8 P. 248, 9 Am.St.Rep. 199] ; Gopcevic v. California Packing Corp., 64 Cal.App. 132 [220 P. 1078]), and in the present case that issue was a disputed one. Plain
The evidence also shows another written provision to which all sales were subject and which must be considered in the determination of the question of the passing of title and delivery. In this respect plaintff’s witness Keane, supervisor of sales in the purchasing department, testified unequivocally that although plaintiff’s form request for bid on material for sale was used only for two carloads, it was understood that all sales were subject to its terms unless contrary conditions were agreed upon; and paragraph 9 of the terms and conditions of that form is as follows: “Seller shall not be obligated to deliver, or Buyer obligated to receive, the property purchased hereunder, when and while, and to the extent that Buyer is prevented from receiving, or Seller from delivering, by act of God, fire, strike, partial or total interruption, or loss or shortage of transportation facilities, commandeering of raw materials, products, plants or facilities or by any other similar or different acts of civil or military authorities or by any cause beyond the control of Seller or Buyer, whether similar to the causes herein specified or not.” (Italics added.)
Furthermore, defendant introduced the testimony of an expert witness whose qualifications were not questioned, from whose testimony it is apparent that the “non-revenue” waybills such as plaintiff here used in consigning the scrap iron to itself, care of the ship on which it was to be exported, were used only in cases of transportation of the railroad company’s own property.
Plaintiff attaches much significance to the use of the term “f.o.b.” Southern Pacific tracks, San Francisco, contending. in effect that it is in itself proof that title passed when the cars reached the Southern Pacific tracks in San Francisco. . It has .been held, however, that while the expression “f.o.b.” signifies generally an intention to pass title, such meaning is not conclusive on that question. (Gopcevic v. California Packing Corp., supra; Gianelli v. Globe Grain & Milling Co., supra.) In the latter case the court after reviewing several earlier decisions went on to say: “It is held in all of the above cases that whatever may be the general trade meaning,of the phrase ‘payable f.o.b.’ or other trade phrases peculiar to commercial contracts or the characters ‘f.o.b.,’ the fact remains that such trade or commercial signification or meaning is. always controlled by the express contract of the parties; and that parol evidence may be received to show what effect such phrases or characters have on such contracts as in fixing the nature, scope, or effect thereof, or as in disclosing the intention of the parties as to such scope and effect.”
It is true that in the present case no oral testimony was produced concerning the meaning of the term “f.o.b”; but when its use is considered in the light of the other facts and circumstances hereinabove set forth, it reasonably may be construed as meaning merely that the purchase price of the scrap iron was fixed on the basis that plaintiff would transport it free of charge from the' places where it was loaded into plaintiff’s cars to plaintiff’s tracks in San Francisco and not beyond; and that the expression was not used as indicating the point of the passage of title. (American Factors, Ltd. v. Goss, 72 Cal.App. 742 [238 P. 121].)
Plaintiff argues that the question of whether the
After testifying at some length in explaining the operation of railroad tariffs and the meaning of certain technic cal terms employed therein, defendant’s expert witness was permitted, over plaintiff’s objection, to give his opinion that the tariffs did not apply to a situation of the kind here presented. Assuming that the objection should have been sustained, it would appear that the negative answer given by the witness cannot be deemed prejudicial, for as stated by the witness, his opinion was based entirely upon the fact, which both sides here agree upon, that the tariffs in question do not apply to cases where the railroad company is transporting its own property.
Plaintiff further contends that in any event judgment for some amount should have been entered in its favor, since the sum for which it sued admittedly included in some instances demurrage charges for the time the cars- were detained after transfer to the Belt Line and before they were unloaded at the dock, for which defendant conceded liability at the trial. However, plaintiff made no attempt whatever to show what portion of its claim was for demurrage on the Belt Line, nor on this appeal does it state the amount it claims thus to be due. In fact at the conclusion of the trial plaintiff’s counsel stated that it would be difficult to stipulate as to the matter because in some instances there was delay both in the Bayshore yards and on the Belt Line. In that
The judgment and order appealed from are affirmed.
Ward, J., concurred.
Concurring Opinion
I concur. I agree that, if the question presented on this appeal presents a question of fact, the evidence supports the implied finding of the jury that title to these goods did not pass until they were delivered to the Belt Line Railroad. Indeed, in my opinion, a finding to the contrary would not be supported.
As the main opinion points out, appellant urges that the question of when title passed was a question of law and not of fact and should not have been submitted to the jury. There may be merit in this contention. It seems to be the rule that where the construction of a contract is involved, and there is either no extrinsic evidence or such evidence is uncontradicted, the question of construction is one of law. But it does not follow that submitting such a question to the jury was necessarily prejudicial to appellant. Under the circumstances above outlined, it is the duty of the appellate court to interpret the contract independent of the construction given to it by the trier of the fact, and to make a final determination of the controversy in accordance with the applicable principles of law. (Estate of Platt, 21 Cal.2d 343, 352 [131 P.2d 825].) If this question is one of law, and I am inclined to believe it is, it seems to be that the reasonable construction of the contract is that the parties intended title to pass only upon delivery to the Belt Line. Since this is in accord with the determination of the jury, it is obvious that whether the question is one of fact or law, since both reach the same result, no prejudice can have been suffered by treating it as a question of fact, even though it be a question of law.
Treating the question as one of law, it seems to me that the' only reasonable construction of the contract of the parties, and of the uncontradicted evidence, is that they intended title to pass only upon delivery to the Belt Line. The phrase “fob your tracks San Francisco” is admittedly ambiguous as to the exact time of passage of title. But there are other provisions of the contract which clearly disclose the intent of the parties. As pointed out in the main opinion, the waybills designated the Southern Pacific Company as consignee
For these reasons I concur in the order affirming the judgment.
A petition for a rehearing was denied May 13, 1944, and appellant’s petition for a hearing by the Supreme Court was denied June 12, 1944.
Reference
- Full Case Name
- SOUTHERN PACIFIC COMPANY (A Corporation), Appellant, v. HYMAN-MICHAELS COMPANY (A Corporation), Respondent
- Cited By
- 12 cases
- Status
- Published