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Semi Metals v. Pinter Brothers

Decided: November 29, 1973.

SEMI METALS INC. AND GENERAL INSTRUMENT CORP., PLAINTIFFS,
v.
PINTER BROTHERS AND EASTERN FREIGHTWAYS, INC., DEFENDANTS



Gascoyne, J.c.c.

Gascoyne

Temporarily Assigned. Since this is a matter of first impression in this State, a thorough review of the facts and law would be appropriate.

There seems to be no question that on August 17, 1970 Semi Metals, Inc. delivered a shipment of "2 ctns Electronic Material", with a weight of 225 lbs. to Pinter Brothers (Pinter) for consignment to Sylvania Electric Co., Chemical and Metallurgical Division (Sylvania), Towanda, Pa. The shipment was sent collect from plaintiff's place of business at 172 Spruce Street, Westbury, New York. The shipment was placed in a sealed trailer with other freight and was delivered

to Eastern Freightways, Inc. (Eastern) at Carlstadt, New Jersey on August 18, 1970. Thereafter, when the trailer was unloaded and a count made, it was found that the two cartons were missing. They have never been recovered and plaintiff sues for full value. If plaintiff is entitled to full value, it is stipulated that this would be in the sum of $19,280. Defendants contend that plaintiff is limited by controlling tariffs to the description as set forth on the bill of lading upon which the carriers relied and based their charges.

The proofs before the court established that the shipment was germanium scrap, a semi-precious metal, used in the manufacture of certain solid state components for electronic equipment. The particular germanium in question had been purchased by plaintiff for delivery to Sylvania. At no time did Pinter inquire as to the value of the goods being shipped, nor was any value declared in writing by the shipper on the bill of lading, this being left blank. No value was agreed in writing as to the released value of the property prior to shipment. The court is satisfied that Pinter could have made itself aware of the extent of its liability merely by instructing its employees not to accept any shipment unless a value was declared on the bill of lading For reasons that will become apparent later, it should be noted that defendants' expert testified that the germanium shipment was of "high value" and not "extraordinary value."

The questions to be decided by this court are twofold: (1) Is plaintiff entitled to full value or a sum less than full value? (2) What is the liability inter sese of the carriers in answering to damages?

For the purpose of convenience the court elects to answer the second question first.

Prior to the enactment of the Interstate Commerce Act with amendments culminating in 49 U.S.C.A. ยง 20 (11), a shipper had the obligation of proving which carrier was responsible for the damage or loss. Since the adoption of

the Act, the initial carrier is liable for any damage or loss caused by it or any connecting or succeeding carrier. The final or delivering carrier is responsible for any damage or loss by it or the preceding connecting carriers Thus, the shipper has option of proceeding against either the initial, delivering carrier, or both for any damage or loss of property, since both are jointly liable. Atlantic Coast Line R. Co. v. Riverside Mills, 219 U.S. 186, 31 S. Ct. 164, 55 L. Ed. 167 (1910); New York, Philadelphia & Norfolk R.R. Co. v. Peninsula Produce Exchange, 240 U.S. 34, 36 S. Ct. 230, 60 L. Ed. 511 (1915); Whitlock Truck Service, Inc. v. Regal Drilling Co., 333 F. 2d 488 (10 Cir. 1964). As between the carriers, the initial carrier is responsible unless it proves that a subsequent carrier was guilty of negligence which proximately caused the damage to or loss of the property. Southern Express, Inc. v. Motor Freight Lines, Inc., 200 F. 2d 797 (5 Cir. 1952). There being no proofs that the loss of the goods was due to the negligence of the terminal carrier, Eastern, the liability rests solely with the initial carrier, Pinter.

The question of damages presents a far more difficult problem. This court is convinced that plaintiff intentionally misdescribed the shipment solely for the purpose of obtaining the lowest rate possible at no risk to it, since plaintiff was insured. The description of the shipment as "electronic equipment" bears as much relationship to the nature of the cargo as describing a shipment of diamonds as watches simply because diamonds are used in the manufacture of watches.

Prior to the enactment of the Interstate Commerce Act by Congress the subject of liability of carriers for loss or damages to goods was left to the states to establish, leaving the states free to permit the carrier to limit its liability by contract. However, Congress, exercising its power to regulate interstate commerce, having ...


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