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Upjohn Co. v. Timpany

Decided: May 15, 1979.

THE UPJOHN COMPANY, A CORPORATION, PLAINTIFF-APPELLANT,
v.
R. D. TIMPANY, TRUSTEE OF THE CENTRAL RAILROAD OF NEW JERSEY, DEFENDANT-RESPONDENT



On appeal from the Superior Court of New Jersey, Law Division, Essex County.

Conford, Pressler and King. The opinion of the court was delivered by King, J.A.D.

King

[168 NJSuper Page 285] This is an appeal from a summary judgment in favor of defendant dismissing plaintiff's complaint claiming damages to an interstate rail shipment. The trial

judge held that the claim was barred by plaintiff's failure to submit a timely notice to the carrier, Central Railroad of New Jersey (CRNJ), within the time required in the bill of lading. Plaintiff contends that the nine-month time limitation was inapplicable because the bill of lading was not in effect at the time of loss.

On March 13, 1973 plaintiff, The Upjohn Company, shipped a tank car of PAPI (a synthetic plastic liquid) from its Houston plant to a terminal and trans-shipping facility in Elizabethport, New Jersey. This facility was known as Through Bulk Service (TBS) and was an operating division of CRNJ. The goods were consigned to "The Upjohn Company, c/o T.B.S. Terminal, Ramp Track, Elizabethport, New Jersey" and arrived on March 22, 1973. Upjohn instructed TBS to hold the tank car at the Elizabethport facility and per instructions to trans-ship piecemeal quantities of the PAPI to tank trucks for shipment to its ultimate customers in interstate commerce. The off-loading of the PAPI was to be done by the carrier's employees.

On April 10, April 23 and May 3 portions of the PAPI were off-loaded and trans-shipped to Upjohn's customer, Bally Case and Cooler, in Bally, Pennsylvania. Each shipment was by truck pursuant to a separate bill of lading. Bally rejected the last two shipments as unsuitable. Samples of the PAPI were then tested by Upjohn and found to be contaminated by moisture. The partially-full tank car was thereafter returned to Upjohn at Houston, arriving on May 31, 1973, and could not be salvaged.

Plaintiff submitted its claim for $32,449.74 in damages on April 23, 1974, more than nine months after the goods were returned to it in Houston. The claim was thereafter rejected by CRNJ on the ground that it had not been presented within nine months after delivery

Plaintiff contends that the time limitation of the bill of lading issued in Texas did not apply once the goods reached the TBS terminal in Elizabethport. Plaintiff asserts that it appointed TBS as its agent to receive the goods on its behalf

and that upon arrival the bill of lading expired. Plaintiff argues that this intent was expressed by the consignment to itself, "c/o TBS", and that after delivery a common law bailment was created, ungoverned by the bill of lading.

Liability for damage to interstate shipment of goods is governed by the Carmack Amendment of 1906 to the Interstate Commerce Act, 34 Stat. 595, 49 U.S.C.A. § 20(11):

The Carmack Amendment of 1906, § 20(11) of the Interstate Commerce Act, makes carriers liable "for the full actual loss, damage or injury . . . caused by" them to property they transport, and declares unlawful and void any contract, regulation, tariff, or other attempted means of limiting this liability. It is settled that this statute has two undisputed effects crucial to the issue in this case: First, the statute codifies the common-law rule that a carrier, though not an absolute insurer, is liable for damage to goods transported by it unless it can show that the damage was caused by "(a) the act of God; (b) the public enemy; (c) the act of the shipper himself; (d) public authority; (e) or the inherent vice or nature of the goods." * * * Second, the statute declares unlawful and void any "rule, regulation, or other limitation of any character whatsoever" purporting to limit this liability. * * * Accordingly, under federal law, in an action to recover from a carrier for damage to a shipment, the shipper establishes his prima facie case when he shows delivery in good condition, arrival in damaged condition, and the amount of damages. Thereupon, the burden of proof is upon the carrier to show both that it was free from negligence and that the damage to the cargo was due to one of the excepted causes relieving the carrier of liability. [ Missouri P.R. Co. v. Elmore & Stahl , 377 U.S. 134, 137-138, 84 S. Ct. 1142, 1144, 1145, 12 L. Ed. 2d 194 (1964)]

Initiating carriers are liable for the full amount of any loss, regardless of whether it occurs on the routes of the initiating carrier, any connecting carrier or the delivering carrier. The shipper has the option of proceeding against either the initiating or delivering carrier. Semi Metals, Inc. v. Pinter Bros. , 126 N.J. Super. 124, 128 (Law Div. 1973), ...


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