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Public Service Electric & Gas Co. v. Reading Co.

Decided: December 24, 1951.


Colie, J.s.c.


By agreement of counsel this cause was tried without a jury. The plaintiff seeks recovery for damages to three current limiting reactors manufactured by General Electric Company and admittedly damaged in transit between Pittsfield, Massachusetts, the point of origin, to Port Reading, New Jersey, the terminal point. The three reactors passed over the lines of other carriers. Two of the reactors were delivered on June 6, 1948, to the plaintiff's siding at Port Reading. On June 9, the third reactor was delivered at the same place. Ultimately, the three reactors were returned to the General Electric Company at Pittsfield, Massachusetts, where, excepting for salvage value, they were scrapped and new reactors manufactured in their stead. In the damaged condition, the reactors were useless to the plaintiff. The original cost of the three reactors was $20,982. The cost of the replacements, after allowing for the salvage value, was $20,858.62.

The reactors were shipped under uniform straight bills of lading as required by 49 U.S.C.A., sec. 20 (11), on the back of which, as sec. 2 (b), appears the following: "As a condition precedent to recovery, claims must be filed in writing with the receiving or delivering carrier, or carrier issuing this bill of lading, or carrier on whose line the loss, damage, injury or delay occurred, within nine months after delivery of the property * * *. Where claims are not filed * * * in accordance with the foregoing provisions, no carrier hereunder shall be liable, and such claims will not be paid." The reverse side of the bill of lading is entitled "Contract terms and conditions" and the rights and liabilities as between the plaintiff and defendant arise from that contract. The issue submitted to the court was whether or not the plaintiff was

entitled to maintain this suit in light of the undisputed fact that written claims for the losses were not filed until December 19, 1949, a period of approximately 18 months after the delivery of the three reactors.

Prior to the trial, the defendant moved for summary judgment for failure of the plaintiff to file a claim or claims for damage in writing within nine months. That motion was denied. Public Service Electric & Gas Co. v. Reading Company , 13 N.J. Super. 383 (Law Div. 1951). At the trial it appeared without question that upon arrival of the first two reactors at Port Reading, representatives of both plaintiff and defendant examined the damaged reactors. Thereafter, when the third reactor arrived, there was an examination by representatives of both of the parties on June 28, 1948. At the trial of the case, Henry W. Codding, an engineer in the electric department of the plaintiff testified as follows:

"Q. In that connection, with respect to the usability of these reactors, did you say anything to any of the railroad officials as to whether or not these concrete reactors could be used in a damaged condition?

A. We had some conversation about it and on my first glance when I saw the condition, to my mind they were useless, could not be used, and since I never heard of anyone being able to repair the concrete there was nothing else to be done except to have them remanufactured and I think I expressed that opinion in their presence, that the reactors were useless, to the best of my recollection about that."

There is, in the entire record, no testimony which, by any reasonable construction, can be construed as a claim.

In Anchor Line, Limited, v. Jackson , 9 F.2d 543 (C.C.A. 2, 1925), that court, speaking through Judge Hand, said after reviewing a number of federal decisions:

"The upshot of these cases is that notice that the goods have been damaged is not notice of a claim for recoupment. The result is perhaps a narrow interpretation, and has not been established in this circuit without strong opposition. Its existence is, however, unquestioned, and it seems to us undesirable by nice distinctions to invite

perpetual litigation in its application. There can, indeed, be no doubt that it is one thing to advise a ship of the fact that she has discharged damaged goods and another that you mean to hold her for the loss. The two may shade into each other, but they are quite distinct. We may concede that notice of damage ordinarily presupposes that the consignee is contemplating a claim, but it is not equivalent even to an assertion that he will make one in the future; certainly it is not a claim in praesenti. He may conclude that he has no rights against the ...

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