A state statute that requires a carrier to settle, within a
specified time, claims for loss of or damage to freight while in
its possession within that state, is not, in the absence of
legislation by Congress on the subject, an unwarrantable
interference with interstate commerce, and so
held that
Act No. 50 of South Carolina of February 23, 1903, to that effect
is not unconstitutional under the commerce law as to goods shipped
from without the state but which actually are in the possession of
the carrier within the state.
A state statute in aid of the performance of the duty of an
interstate carrier which would exist in the absence of the statute,
which does not obstruct the carrier and which relates to the
delivery of goods actually in the carrier's possession within the
state, is not void as a regulation or obstruction to interstate
commerce in the absence of congressional legislation on the
subject.
78 S.C. 36 affirmed.
By the act of the General Assembly of the State of South
Carolina entitled, "An Act to Regulate the Manner in which Common
Carriers Doing Business in This state Shall Adjust Freight Charges
and Claims for Loss of or Damage to Freight," approved February 23,
1903 (No. 50, Acts of S.C. 1903, p. 81), it was enacted:
Page 216 U. S. 123
"SECTION 1.
Be it enacted by the General Assembly of
the State of South Carolina, That from and after the passage of
this act, all common carriers doing business in this state shall
settle their freight charges according to the rate stipulated in
the bill of lading:
Provided, The rate therein stipulated
be in conformity with the classifications and rates made and filed
with the Interstate Commerce Commission, in case of shipments from
without this state, and with those of the railroad commissioners of
this state, in case of shipments wholly within this state; by which
classifications and rates all consignees shall in all cases be
entitled to settle freight charges with such carriers, and it shall
be the duty of such common carrier to inform any consignee or
consignees of the correct amount due for freight, according to such
classifications and rates, and upon payment or tender of the amount
due on any shipment, or on any part of any shipment, which has
arrived at its destination, according to such classifications or
rates, such common carrier shall deliver the freight in question to
the consignee or consignees, and any failure or refusal to comply
with the provisions hereof shall subject each such carrier so
failing or refusing to a penalty of fifty dollars for each such
failure or refusal, to be recovered by any consignee or consignees
aggrieved by suit in any court of competent jurisdiction."
"SEC. 2. That every claim for loss of or damage to property
while in the possession of such common carrier shall be adjusted
and paid within forty days, in case of shipments wholly within this
state, and within ninety days, in case of shipments from without
this state, after the filing of such claim with the agent of such
carrier at the point of destination of such shipment:
Provided, That no such claim shall be filed until after
the arrival of the shipment or of some part thereof at the point of
destination, or until after the lapse of a reasonable time for the
arrival thereof. In every case, such common carrier shall be liable
for the amount of such loss or damage, together with interest
thereon from the date of the filing of the claim therefor
Page 216 U. S. 124
until the payment thereof. Failure to adjust and pay such claim
within the periods respectively herein prescribed shall subject
each common carrier so failing to a penalty of fifty dollars for
each and every such failure, to be recovered by any consignee or
consignees aggrieved in any court of competent jurisdiction:
Provided, That unless such consignee or consignees recover
in such action the full amount claimed, no penalty shall be
recovered, but only the actual amount of the loss or damage, with
interest as aforesaid:
Provided, further, That no common
carrier shall be liable under this act for property which never
came into its possession, if it complies with the provisions of
§ 1710, vol. 1, of the Code of Laws of South Carolina,
1902."
Section 1710, volume 1, of the Code of Laws of South Carolina,
1902, is as follows:
"When under contract for shipment of freight or express over two
or more common carriers, the responsibility of each or any of them
shall cease upon delivery to the connecting line 'in good order,'
and if such freight or express has been lost, damaged, or
destroyed, it shall be the duty of the initial, delivering, or
terminal road, upon notice of such loss, damage, or destruction
being given to it by the shippers, consignee, or their assigns, to
adjust such loss or damage with the owners of said goods within
forty days, and upon failure to discharge such duty within forty
days after such notice, or to trace such freight or express, and
inform the said party so notifying when, where, and by which
carrier the said freight or express was lost, damaged, or
destroyed, within said forty days, then said carrier shall be
liable for all such loss, damage, or destruction in the same manner
and to the same extent as if such loss, damage, or destruction
occurred on its lines:
Provided, That if such initial,
terminal, or delivering road can prove that, by the exercise of due
diligence, it has been unable to trace the line upon which such
loss, damage, or destruction occurred, [it] shall thereupon be
excused from liability under this section."
The above-entitled cases were brought to test the validity
of
Page 216 U. S. 125
the provisions of § 2 of the Act of February, 1903, when
applied to claims for loss or damage to interstate freight.
In each case, the objection that that section was
unconstitutional and invalid was seasonably made. In each case, the
objection was overruled and judgment given in favor of the
respective claimants, plaintiffs, for the value of the undelivered
freight, with the full penalty of fifty dollars added.
The opinion of the Supreme Court of South Carolina, construing
and applying the provisions of the state statute, appears in the
printed transcript of the record in case No. 60,
Atlantic Coast
Line Railroad Company v. Charles, 78 S.C. 36. In each of the
other cases, the principles assumed to have been settled in and by
that opinion were made the basis of the judgment of the state
supreme court.
The cases were submitted to this Court December 9, 1909, as one
case, and argued as such on one side only. On the twentieth of
December, this Court entered an order that notice of the pendency
of these cases should be given to the Attorney General of South
Carolina, and leave was given to him to file a brief as
amicus
curiae on or before the third day of January, if he should be
so advised. The Attorney General filed a brief accordingly January
3, 1910; Townsend was with him on the brief.
Page 216 U. S. 129
MR. CHIEF JUSTICE FULLER delivered the opinion of the Court.
In No. 60,
Atlantic Coast Line R. Co. v. Charles, which
was assumed by the Supreme Court of South Carolina to settle all
the others, and to have been made the basis for the judgment of
that court in all the cases, the state court found as matter of
fact, "the evidence showed that defendant was in possession of the
goods lost," and held as matter of law
"that the statute in question, as it affects carriers doing
business in this state who fail or refuse to adjust and pay the
loss of or damage to goods while in their possession, is no
unlawful interference with interstate commerce, even as applied to
an interstate shipment."
It is thus apparent that the statute is construed by the court
as only concerning property lost or damaged while in the possession
of a carrier in the State of South Carolina.
It is this conclusion of law that the plaintiff in error asks
this Court to review.
In
Venning v. Atlantic Coast Line R. Co., 78 S.C. 55,
it was expressly decided that the act did not apply to claims
Page 216 U. S. 130
for loss of property which never came into the possession of the
defendant. In that case, the state supreme court considered an act
of May, 1903, and held it, for the reason given, to be
unconstitutional, not as obnoxious to the Fourteenth Amendment of
the Constitution of the United States and the Constitution of South
Carolina, but as amounting to an illegal attempt to regulate
interstate commerce. And that,
"on principle, as well as under the authority of
Central R.
Co. v. Murphey, 196 U. S. 194, it is impossible
to avoid the conclusion that the act of May, 1903, here under
consideration, is unconstitutional."
And further, that it was evident from the complaint that the
action was intended to rest on the invalidity, under the act of
May, 1903, of such a contract as § 1710 contemplates, and that
therefore that section could have no application.
The court then considered the act of February, 1903, and said
(78 S.C. 55):
"The section of main importance here is the second, which
provides for the recovery for loss of or damage to freight, and
penalties for failure to adjust and pay such loss or damage within
a certain time. The question vital to this case is whether the
statute can be construed to impose upon one connecting carrier,
liability for the default of another, unless such carrier obtains
and gives the information, or uses due diligence to obtain it, as
provided in § 1710 of the Civil Code. We do not think it can
be so construed."
"The main enactment as to the recovery of damages and penalties
thus begins in § 2: 'That every claim for loss of or damage to
property
while in the possession of such common carrier
shall be adjusted and paid within forty days,' etc. The words we
have italicized clearly limit the loss and damage which a carrier
is required to adjust and pay for to that which befalls while the
goods are in the possession of such carrier, and excludes the idea
of liability for loss or damage to the goods while in the
possession of another carrier."
"It is true there is a proviso at the end of this section,"
"that
Page 216 U. S. 131
no common carrier shall be liable under this act for property
which never came into its possession, if it complies with the
provisions of § 1710, vol. I, of the Code of Laws of South
Carolina, 1902."
"But as the body of the act does not make the carrier liable at
all 'for goods which never came into its possession,' a proviso
which exempts from liability for loss of or damage to such goods on
certain conditions can have no effect. The act imposes no liability
to which the exemption can be applied."
"The rule is that all parts of a statute, including provisos,
are to be construed together, and effect given, if possible, to
all. But it is contrary to reason as well as authority to
extend by implication a proviso to cover that which is
opposed to the express language of the main enactment.
Southgate v. Goldthwaite, 1 Bail 367;
United States v.
Dickson, 15 Pet. 141;
The
Irresistible, 7 Wheat. 551; 26 Am. & Eng.
Enc.Law, p. 681; Endlich, Interpretation of Statutes, §§
184, 185. The fact that the statute is penal adds force to this
conclusion. We are of the opinion that the proviso of § 2 has
no effect, and the act only imposes penalties upon the carrier for
failing to adjust claims for loss occurring while the goods are in
its own possession."
"It follows, the plaintiff in this case cannot sustain his
recovery on the ground that the defendant was liable, under the act
of February, 1903, for goods lost by a connecting carrier, because
it failed to obtain and give information of the kind required in
cases falling under that act, or to use due diligence to obtain
such information."
"This penalty act of February will apply to the case, if the
finding on the new trial should be that the loss occurred on the
defendant's road, but not otherwise. It is attacked as
unconstitutional under the interstate commerce clause of the
Constitution of the United States. That question is discussed and
decided against the defendants contention in
Charles v. A.C.L.
R. Co., 78 S.C. 36."
In
Charles v. Railroad Company, 78 S.C. 36, the action
was brought in a magistrate court to recover the value of four
Page 216 U. S. 132
sacks of rice, alleged to have been shipped from New Orleans,
Louisiana, by Martin J. Wynne, to the plaintiff at Timmonsville,
South Carolina, and to have been lost while in the possession of
the defendant carrier, and also to recover fifty dollars' penalty
for failure to adjust and pay the claim within ninety days, as
prescribed by the Act of February 23, 1903. The magistrate gave
judgment against defendant for the amount claimed, and that
judgment, on appeal, was affirmed by the circuit court, and then
again by the supreme court of the state in this case. The supreme
court held that the last proviso of the second section of the act
of February, 1903, had no application to carriers into whose
possession the goods had come, and referred to the opinion of the
court in
Seegers v. Railway, 73 S.C. 71, 73, where it was
said:
"The duty to make prompt settlement for loss or damage to goods
is but an incident of the duty to transport and deliver safely and
with reasonable diligence. The statute in question was designed to
effectuate an important public purpose;
viz., to compel
the common carrier to perform with reasonable diligence the duty
which peculiarly appertains to his business as a carrier of
freight. The penalty is but a means to that end."
And see same case,
207 U. S. 207 U.S.
73.
The supreme court, after making that quotation, thus
proceeded:
"While it is not easy to define the exact limits of the
operation of state laws as affecting interstate commerce, we have
no hesitation in saying that the statute in question, as it affects
carriers doing business in this state, who fail or refuse to adjust
and pay the loss of or damage to goods while in their possession,
is no unlawful interference with interstate commerce, even as
applied to an interstate shipment. The penalty imposed is for a
delict of duty appertaining to the business of a common carrier,
and insofar as it may affect interstate commerce, it is an aid
thereto by its tendency to promote safe and prompt delivery of
goods, or its legal equivalent -- prompt settlement of proper claim
for damages. No penalty can attach
Page 216 U. S. 133
except upon the establishment in a court of a default of duty
imposed by statute. The statute does not attempt to regulate
interstate commerce, and imposes no tax or burden thereon. It is
supported by the general principle declared in
Sherlock v.
Alling, 93 U. S. 99,
93 U. S.
104, and enforced in
Smith v. Alabama,
124 U. S.
465, and
Nashville &c. R. Co. v. Alabama,
128 U. S.
96, that state legislation"
"relating to the rights, duties, and liabilities of citizens,
and only indirectly and remotely affecting the operations of
commerce, is of obligatory force upon citizens within the
territorial jurisdiction, whether on land or water, or engaged in
commerce, foreign or interstate, or in any other pursuit."
In the case of
Western Union Telegraph Co. v. James,
162 U. S. 650, a
statute of Georgia requiring telegraph companies to transmit and
deliver dispatches with impartiality, good faith, and diligence,
under penalty of $100 in each case, in the absence of legislation
by Congress on the subject, was held not to be an unwarrantable
interference with interstate commerce as to messages without the
state, and Mr. Justice Peckham, delivering the opinion of the
Court, said, p.
162 U. S.
660:
"The statute in question is of a nature that is in aid of the
performance of a duty of the company that would exist in the
absence of any such statute, and it is in nowise obstructive of its
duty as a telegraph company. It imposes a penalty for the purpose
of enforcing this general duty of the company. The direction that
the delivery of the message shall be made with impartiality and in
good faith and with due diligence is not an addition to the duty
which it would owe in the absence of such a statute. Can it be said
that the imposition of a penalty for the violation of a duty which
the company owed by the general law of the land is a regulation of
or an obstruction to interstate commerce within the meaning of that
clause of the federal Constitution under discussion? We think
not."
And see Chicago, Milwaukee & St. Paul Ry. Co. v.
Solan, 169 U. S. 137;
Pennsylvania R. Co. v. Hughes, 191
U. S. 491;
Missouri Pacific Ry. Co.
v. Larabee Flour Mills Co.,
Page 216 U. S. 134
211 U. S. 624.
The present cases fall within the rules there laid down, and
Central of Georgia Ry. Co. v. Murphey, 196
U. S. 195;
Houston & Texas Central R. Co. v.
Mayes, 201 U. S. 321, and
McNeill v. Southern Ry. Co., 202 U.
S. 543, cited to the contrary, are really not in
conflict therewith.
Judgments affirmed.
