Dickerson v. Western Union Telegraph Co.

74 So. 779, 114 Miss. 115

Opinion

Ethridge, J.,

delivered the opinion of the court.

(After stating the facts as above). At the March term, 1916, a motion was made in this case by the Western Union Telegraph Company to dismiss as to it, claiming that any right of appeal of appellant was barred by the statute of limitations, which motion was overruled by the court in an opinion (111 Miss. 264, 71 So. 385), which is the law in so far as the limitation question involved in this appeal is. concerned. The question as to whether or not the Western Union would be liable would depend on whether the clause in the special plea of the Postal Company, in which it alleged that it procured or contracted with the Western Union Company as the agent of appellant or plaintiff, is valid., As we reach the conclusion that this clause in the contract was not valid, on our theory that the local state laws of Mississippi and Alabama would govern this case, and not the laws of the United States, and that the clause would apply only where the Postal Company have no line from the sending office to the receiving office, we decide that the Western Union Company is not liable to the plaintiff, Dickerson, but its liability, 'if any, is to the Postal Company; and on this branch, of the case the action of the lower court is affirmed.

The question of liability between appellant and the Postal Company presented by the record depend upon the question as to whether or not the act of Congress of June 18, 1910, has the effect of suspending and displacing state regulations and laws with reference to the telegraph business. It is argued by the appellant that the act of 1910 did not undertake to regulate the duties and liabilities between the telegraph companies and their patrons and customers, but that it only undertakes to deal with rates, and that Congress had not, therefore, taken full control of the telegraph business, and that consequently the laws of the state apply to transactions of the kind presented by this record. Un der the law of both the states of Mississippi and Alabama the willful and wanton neglect of the telegraph company in sending and delivering a message authorizes punitive damages. It follows that the matters pleaded in defense of this suit do not present a defense, with the exception, possibly, of the sixty day time limit for filing a claim, but the record shows the suit was filed within the sixty days, and that question is not presented for decision here.

The appellant concedes that if the federal law prevails and applies to this case there can be no recovery of punitive damages unless it is shown that the master either participated in the wrong of the servant or after-wards ratified it and, further, the appellant could not establish liability by showing that the master participated in the wrong, or ratified it,'as construed by the federal courts, after it was done. The question must turn upon whether the state or federal law governs the liability in this ease.

The act to regulate commerce was amended by the act •of 1910 so as to make telegraph companies common carriers, and provides that:

“All charges made for . . service rendered or to he rendered in the transportation of passengers or property and for transmission of messages by telegraph, telephone, or cable, as aforesaid, or in connection therewith, shall be just and reasonable; and every unjust and unreasonable charge for such service or any part thereof is prohibited and declared to be unlawful; Provided, that messages by telegraph, telephone, or cable, subject to the provisions of this act, may be classified into day, night, repeated, unrepeated, letter, commercial, press, goverment, and such other classes as are just and reasonable, and different rates may be charged for the different classes of messages.”

The contention of appellee is that by this provision Congress has taken charge of the telegraph and telephone business to the same extent that it has taken charge of common carriers of persons and property under the Carmack Amendment. The Carmack Amendment is as follows:

“That any common carrier, railroad, or transportation company receiving property for transportation from a point in one state .to a point in another state shall issue a receipt or hill of lading therefore and shall he liable to the lawful holder thereof for any loss, damage, or injury to such property caused by it or by any common carrier, railroad, or transportation company to which such property may be delivered or over whose line or lines such property may pass, and no contract, receipt, rule, or regulation shall exempt such common carrier, ráilroad, or transportation company from the liability hereby imposed; Provided, that nothing in this section shall deprive any holder of such receipt or bill of lading' of any remedy or right of action which he has under existing law.

“That the common carrier, railroad, or transportation company issuing such receipt or bill of lading shall be entitled to recover from the common carrier, railroad, or transportation company on whose line the loss, damage, or injury shall have been sustained, the amount of such loss, damage, or injury as it may be required to pay to the owners of such property, as may be evidenced by any receipt, judgment, or transcript thereof.”

It is not contended by the appellees in the argument here that this specific provision applies to telephone and telegraph companies, but that the provision of the statute above quoted, on common carriers, is in effect, as broad and comprehensive as the Carmack Amendment, and that it has the necessary effect of the federal government having undertaken full control of this business, and that, as to interstate messages, state laws and decisions are inapplicable, but that the liability is entirely controlled by the federal laws and decisions. It seems to us that the act of 1910 is no broader, when applied to telegraph and telephone companies, than the original act to regulate commerce prior to the Carmack Amendment was to the railroads, and that the same rules would apply to the telegraph business under the present statute as applied to the railroads under the statute prior to the Carmack Amendment. We are aware that the courts of several states, and some of the federal courts, have decided in accordance with the contention of appellee and that this court, in the case of Western Union Telegraph Co. v. Showers, 73 So. 276, followed those decisions in holding that the act of Congress had superseded state laws and decision. In the present case, these authorities have been reviewed and discussed in the arguments, and we have carefully examined them, and have reached the conclusion that these decisions have misconceived the effect of the act of 1910, and have misconstrued the effect and purport of the decision of the United States supreme court in Western Union Telegraph Co. v. Brown, 234 U. S. 542, 34 Sup. Ct. 955, 58 L. Ed. 1457, and Adams Express Co. v. Cronlinger, 226 U. S. 491, 33 Sup. Ct. 148, 57 L. Ed. 314, 44 L. R. A. (N. S.) 257. In Western Union Co. v. Brown, supra, the cause of action sued on was brought under a statute of the state of South Carolina (Civil Code of South Carolina, 1902, section 2223), which imposed liability for the failure to send and deliver telegrams. As construed by the supreme court of that state, it was held that the telegraph company was liable on a message sent from South Carolina to Washington, D. C., where the cause of action arose, because of the negligence of the telegraph company in failing to deliver promptly the telegram after its receipt in Washington. The federal supreme court in deciding this case says:

“ Whatever variations of opinion and practice there may have been, it is established as the law of this court that when a person recovers in one jurisdiction for a tort committed in another, he does so on the ground of an obligation incurred at the place of the tort that accompanies the person of the defendant elsewhere, and that is not only the ground but the measure, of the maximum recovery. . . ; The injustice of imposing a greater liability than that created by the law governing .the conduct of the parties at the time of the act or ommission complained of is obvious; and when a state attempts in this manner to affect conduct outside its jurisdiction or the consequences of such conduct, and to infringe upon the power of the United States, it must fail. The principle would be illustrated by supposing a direct clash between the state and federal statutes; but it is the same whenever the state undertakes to go beyond its jurisdiction into territory where the United States has exclusive control.”

The court then proceeds to say:

“What we have said is enough to dispose of the case. But the act also is objectionable in its aspect of an attempt to regulate commerce among the states. That is, as construed, it attempts to determine the conduct required of the telegraph company in transmitting a message from one state to another or to this district by determining the consequences of not pursuing such conduct, and in that way encounters Western U. T. Co. v. Pendelton. 122 U. S. 347, 7 Sup. Ct. 1126, 30 L. Ed. 1187, 1 Interest. Com. R. 306, a decision in no way qualified by Western U. T. Co. v. Commercial Mill. Co., 218 U. S. 406, 31 Sup. Ct. 59, 54 L. Ed. 1088, 36 L. R. A. (N. S.) 220, 21 Ann. Cas. 815.”

In other words, the supreme court merely held that a state cannot impose, by its statutes or decisions, liability that would extend to conduct beyond the territorial limits of the state. It will readily be seen that if each state could extend its statutes beyond its own borders and impress liability upon a person for acts done outside of its territorial jurisdiction, there would be the utmost confusion. But the federal supreme court, in the case quoted above, did not decide, and, we apprehend, will n.ot decide, that a state cannot enforce the performance of duties within its borders even as to interstate transactions, until Congress shall have provided a rule of liability. In the note to the Lawyers’ Edition report of this case, the learned editor of the report says:

“Had the default occured in South Carolina, however, a different result must have been reached, under the doctrine of Western U. T. Co. v. Crovo, 220 U. S. 364, 31 Sup. Ct. 399, 55 L. Ed. 498, where a state statute,under which a penalty is incurred by a telegraph company which negligently fails to transmit within the state as promptly as practicable a message received at an office in the state for transmission to a person in another state, was held to be a valid exercise of the police power of the state, in the absence of any legislation by Congress on the subject. In Ivy v. Western U. T. Co. [(C. C.) 165 Fed. 371] supra the action was based upon a failure to deliver a message sent to a point in Indiana from a place in Arkansas, in which latter state the suit was brought. The court applied the Arkansas mental anguish statute, and held that, as so applied, the statute, incidentally affecting contracts for the transmission of interstate messages, was not an unconstitutional regulation of interstate commerce. ’ ’

In Western Union Telegraph Co. v. Crovo, 220 U. S. 364, 31 Sup. Ct. 399, 55 L. Ed. 498, above referred to the court, discussing the proposition of imposing penalties upon interstate messages by state laws, said:

“The only question for decision, is whether a statute of the state of Virginia which imposes a penalty for the failure to transmit a dispatch received at an office of the company in the state for transmission to a person in another state is a valid exercise of the power of the state, the delay occuring in the state. That companies engaged in the telegraph business, whose lines extend from one state to another, are engaged in interstate commerce, and that messages passing from one state to another constitute such commerce, is indisputable. Such companies and such messages come, therefore, under the regulating power of Congress. It follows, then, that if this statute as applied in the state court is to be construed as a regulation of commerce between the states, it is in .excess of the power of the state. ... No attempt is here made to enforce the provisions of the state statute beyond the limits of the state, and no other state could, by legislative enactment, affect in any degree the duty of the company in relation to the delivery of messages within the limits of the state of Georgia. No confusion, therefore, could' be expected in carrying out within the limits of that state the provisions of the statute. It is true it provides a penalty for a violation of its terms and permits a recovery of the amount thereof irrespective of the question whether any actual damages have been sustained by the individual who brings the suit; but that is only a matter in aid of the performance of the general duty owed by the company. It is not a regulation of commerce, but a provision which only incidentally affects it. . . . ‘While it is vitally important that commerce between the states should be unembarrassed by vexatious state regulations regarding it, yet, on the other hand, there are many occasions where the police power of the state can be properly exercised to insure a faithful prompt performance of duty within the limits of the state upon the part of those who are engaged in interstate commerce. We think the statute in question is one of that class, and in the absence of any legislature by Congress the statute is a valid exercise of the power of the state over the subject.’ ”

In the ease of Adams Express Co. v. Croninger, 226 U. S. 491, 33 Sup. Ct. 148, 57 L. Ed. 314, 44 L. R. A. (N. S.) 257, which involved a question as to whether or not Congress had taken over full control of railroad transportation under the Carmack Amendment, the federal supreme court, in analyzing the act as applied to railroad companies contained in the Carmack Amendment above referred to, says:

“The significant and dominating features of that amendments are these:

“First, it affirmatively requires the initial carrier to issue ‘a receipt or bill of lading therefor,’ when it receives property for transportation from a point in one state to a point in another.”

“Second. Such initial carrier is made ‘liable to the lawful holder thereof for any loss, damage, or injury to such property caused by it.’

“Third. It is also made liable for any loss, damage, or injury to such property caused by ‘any common carrier, railroad or transportation company to which such property may be delivered or over whose line or lines such property may pass.’

“Fourth. It affirmatively declares that ‘no contract, receipt, rule or regulation shall exempt such common carrier, railroad, or transportatioii company from the liability hereby imposed.’

“Prior to that amendment the rule of carriers liability, for an interstate shipment of property, as enforced in both federal and state courts, was either that of the general common law as declared by this court and enforced in the federal courts throughout the United States (Hart v. Pennsylvania R. Co., 112 U. S. 331, 5 Sup. Ct. 151, 28 L. Ed. 717), or that determined by the supposed public policy of a particular state (Pennsylvania R. Co. v. Hughes, 191 U. S. 477, 24 Sup. Ct. 132, 48 L. Ed. 268), or that prescribed by statute law of a particular state (Chicago, M. & St. P. R. Co. v. Solan. 169 U. S. 133, 18 Sup. Ct. 289, 42 L. Ed. 688).....

“That the legislature supersedes all the regulations and policies of a particular state upon the same subject results from its general character. It embraces the subject of the liability of the carrier under a bill of lading which he must issue, and limits his power to exempt himself by rule, regulation, or contract. Almost every detail of the subject is covered so completely that there can be no' rational doubt but that Congress intended to take possession of the subject and spersede all state regulation with reference to it. Only the silence of Congress authorized the exercise of the police power of the state upon the subject of such contracts. But when Congress acted in such a way as to manifest a purpose to exercise its conceded authority, the regulation power of the state ceased to exist. Northern P. R. Co. v. Washington. 222 U. S. 370, 32 Sup. Ct. 160, 56 L. Ed. 237; Southern R. Co. v. Reid, 222 U. S. 424, 32 Sup. Ct. 140, 56 L. Ed. 257; Second Employers’ Liability Cases, Mondou v. New York, N. H. & H. R. Co., 223 U. S. 1, 32 Sup. Ct. 169, 56 L. Ed. 327, 38 L. R. A. (N. S.) 44.”

It will be seen that the Carmack Amendment radically changed the obligations, liabilities, and duties of a common carrier in transportation as existing prior to 1906, and as cited by the court in the above quotation.

On page 505 of 226 U. S., page 152 of 33 Sup. Ct. page 320 of 57 L. Ed. (44 L. R. A. [N. S.] 257), of the above case, the court says:

"That the legislature supersedes all the regulations and policies of a particular state upon the same subject results from its general character. It embraces the subject of the liability of the carrier under a bill of lading which he must issue, and limits his power to exempt himself by rule, regulation, or contract. Almost every detail of the subject is covered so completely that there can be no rational doubt but that Congress intended to take possession of the subject and supersede all state regulation with reference to it. Only the silence of Congress authorized the exercise of the police power of the state upon the subject of such contracts. But when Congress acted in such a way as to manifest a purpose to exercise its conceded authority, the regulating power of the state ceased to exist.”

In the case of Pennsylvania Railroad Co. v. Hughes, referred to in the Croninger Case, supra, the court discussing the right of a state to impose regulations under the federal act to regulate commerce as it then existed, on page 486 of 191 U. S., page 134 of 24 Sup. Ct., on page 271 of 48 L. Ed., used the following language :

“In Grogan v. Adams Exp. Co., 114 Pa. 523, 7 Atl. 134, 60 Am. Rep. 360, the supreme court of Pennsylvania expressly declined to follow the rule laid down in Hart v. Pennsylvania Railroad Company, adhering to its own declared doctrine, denying the right of a common carrier to thus limit its liabilities for injuries resulting from negligence. The cases are numerous and conflicting, different rules prevailing in different states. The federal courts in cases of which they have jurisdiction will doubtless continue to follow the rule of the Hart Case, but the highest court of Pennsylvania may administer the common law according to its understanding and interpretation of it, being only amenable to review in the federal supreme court where some right, title, immunity, or privilege, the creation of the federal power, has been asserted and denied. Bethell v. Demaret, 10 Wall. 537, 19 L. Ed. 1007; Delmas v. Merchants’ Mut. Ins. Co., 14 Wall. 666, 20 L. Ed. 759; New York L. Ins. Co. v. Hendren, 92 U. S. 287, 23 L. Ed. 709; United States v. Thompson, 93 U. S. 586, 23 L. Ed. 982.

“In the supreme court of Pennsylvania a further assignment of error was made as follows: ‘III The learned court below erred in entering judgment in conflict with the act of Congress of February 4, 1887, entitled “An' act to regulate commerce.” Section 1 of said act clearly provides that where the transportation is from one state to another, under a through bill of lading, its provisions shall be carried out, unless it be in conflict with a statute of the state in which it may be performed, or in conflict with the policy of the United States as laid down in the federal courts, and that, as the contract was valid in the place where made, and, as there is no statute in Pennsylvania prohibitory of an agreed valuation to establish a rate, and as it is consistent with the policy of the United States as declared by the federal courts,, the judgment should have been for the valuation mentioned in the contract.’

“Of this assignment of error, Mr Justice Potter, delivering the opinion of the supreme court of Pennsylvania, said: 'The third assignment of error suggests that the entry of judgment is in conflict with the Interstate Commerce Act of Congress. This seems to be an afterthought, as there is no indication in the record that this question was raised or considered in the court below. It is not apparent how the act can have any application to this case. It contains nothing bearing upon the validity of a contract limiting the liability of a railroad for loss or injury caused by negligence. The object of the' act seems to be to secure continuous carriage and uniform rates, and to compel the furnishing of equal facilities. We cannot see that the entry of judgment in this case interferes in any way with the legitimate exercise of interstate commerce.’

“Upon the authority of Missouri, K. & T. R. Co. v. Elliott, 184 U. S. 533, 22 Sup. Ct. 446, 46 L. Ed. 674, it may be admitted that the question of the decision of the state court, being in contravention of the legislation of Congress to regulate intertsate commerce, was sufficiently made, and the adverse decision to the party claiming the benefit of that act gives rise to the right of review here. In refusing to limit the recovery to the valuation agreed upon, did the state court deny to the company a right or privilege secured by the interstate commerce law? It may be assumed that under the broad power conferred upon Congress over interstate commerce as defined in repeated decisions of this court, it would be lawful for that body to make provision as to-contracts for interstate carriage, permitting the carrier to limit its liability to a particular sum in consideration of lower freight rates for transportation. But upon examination of the terms of the law relied upon we fail to find any such provision therein the sections of the interstate commerce law relied upon by the learned counsel for plaintiff in error (24 Stat. at L. 379 —82, c. 104, IT.' S. Comp. Stat. 1901, pp. 3154 — 3159; 25 Stat. at L. 855, e. 382, IT. S. Comp. Stat. 1901, p. 3158) provide for equal facilities to shippers for the interchange of traffic; for nondiscrimination in freight rates; for keeping schedules of rates open to public inspection; for posting -the same in public places, with certain particulars as to charges, rules, and regulations; for the publication of joint tariff rates for continuous transportation over one or more lines to he made public when directed by the Interstate Commerce Commission; against advances in joint tariff rates except after ten days’ notice to the Commission; against reduction of joint tariff rates except after three days like notice; making it unlawful for any party to a joint tariff to receive or demand a greater or less conpensation for the transportation of property between points as to which a joint tariff is made different than is specified in the schedule filed with the commission; giving remedies for the enforcement of the foregoing provisions, and providing penalties for their violation; making it unlawful to prevent continuous carriage, and providing that no break of bulk, stoppage, or • interruption by the carrier, unless made in good faith for some necessary purpose, without intention to evade the act, shall prevent the carriage of freights from being treated as one continuous carriage from the place of shipment to the place of destination.

“While under these provisions it may be said that Congress has made it obligatory to provide proper facilities for interstate carriage of freight, and has prevented carriers from obstructing continuous shipments on interstate lines, we look in vain for any regu lation of the matter here in controversy. There is no sanction of agreements of this character limiting liability to stipulated valuation, and, until Congress shall legislate upon it, is there any valid objection to the state enforcing its own regulations upon the subject, although it may, to this extent, indirectly affect interstate commerce contracts of carriage? '

“It is well settled that the state may make valid enactments in the exercise of its legislative power to promote the welfare and convenience of its citizens, although in their operation they may have an effect upon interstate traffic. .

“The case of Chicago, M. & St. P. R. Co. v. Solan, 169 U. S. 133, 18 Sup. Ct. 289, 42 L. Ed. 688, is, in our opinion, virtually decisive of the question made upon this branch of the case. In that case cattle were loaded at Rock Yalley, Iowa, to be shipped to Chicago. The contract, as here, was for interstate transportation. An injury happened to the drover in charge of the cattle in Iowa, due to the negligence of the transporting company. The shipper had signed a contract providing: ‘That the company shall in no event be liable to the owner or person in charge of said stock for any injury to his person in any amount exceeding the sum of five hundred dollars.’ The company averred and offered to prove that, in view of this limited liability, it had agreed to transport the cattle at a reduced rate. The Statute of Iowa provided: ‘No contract, receipt, rule or regulation shall exempt any corporation engaged in transporting persons or property by railway from liability of a common carrier, or carrier of passengers, which would exist had no contract, receipt, rule or regulation been made or entered into.’ Iowa Code of 1873, section 1308. The trial court charged that the limitation contained in the contract was void, and a verdict of one thousand dollars damages was returned. A judgment on the verdict was affirmed in the supreme court of Iowa. In delivering the opinion of this court Mr. Jus tice Gray said (169 U. S. p. 137 [18 Sup. Ct. 291, 42 L. Ed. 688]): ‘ A carrier exercising his calling within a particular state, although engaged in the business of the interstate commerce, is answerable, according to the law of the state, for acts of nonfeasance or of misfeasance committed within its limits. If he fails to deliver goods to the proper consignee at the right time and place, or if by negligence in transportation he inflicts injury upon the person of a passenger brought from another state, the right of action for the consequent damage is given by the local law. It is equally within the power of the state to prescribe the safeguards oq jedoid puu Nressooau oq oq ueeseioj suoiqnnoejd pun prevent by anticipation those wrongs and injuries which, after they have been inflicted, the state has the power to redress and to punish. The rules prescribed for the construction of railroads, and for their management and operation, designed to protect persons and property, otherwise endangered by their use, are strictly within the scope of the local law. They are not, in themselves, regulations of interstate commerce, although they control, in some degree, the conduct and the liability of those engaged in such commerce. So long as Congress has not legislated upon the particular subject, they are rather to be regarded as legislation in aid of such commerce, and as a rightful exercise of the police power of the state to regulate the relative rights and duties of all persons and corporations within its limits. .

The statute now in question, so far as it concerns liability for injuries happening within the state of Iowa, which is the only matter presented for decision in this case, clearly comes within the same principles. It is in no just sense a regulation of commerce: It does not undertake to impose any tax upon the company, or to restrict the persons or things to be carried, or to regulate the rate of tolls, fares, or freight. Its whole object and effect are to make it more sure that railroad companies shall perform the duty, resting upon them by virtue of their employment as common carriers, to use the utmost care and diligence in the transportation of passengers and goods.’ ”

Beverting to the act of 1910, set out above, what statute of the United States regulates liabilities,' rights, and duties between the telegraph company and its patrons? It is elementary that there is no federal common law, and that the powers of the federal government are delegated ones, and it must, by statute, prescribe the rules and regulations of a subject committed to its care. United States v. Hudson, 7 Cranch, 32, 3 L. Ed. 259; Hughes Federal Jurisdiction and Procedure, pp. 5, 6, and 22; Wheaton v. Peters, 8 Pet. 591, 8 L. Ed. 1055; Smith v. Alabama, 124 U. S. 465 [8 Sup. Ct. 564] 31 L. Ed. 508. The federal government, in cases where Congress has not acted. Enforces rights in matters brought before it within its jurisdiction according to the laws of the states, but does not, in all cases, follow the state courts’ interpretations of the common law, but uses its own judgment and decides for itself what the common law is. In some of the decisions this would create confusion, unless we bear in mind that the federal government is a government of delegated powers, and that it has never, by statute, adopted the common law as it existed in England or in any particular jurisdiction. Inasmuch as each state is sovereign, and adopts the common law, modified by its local conditions and environment, it would seem that the state court ought to be best able to judge of the common law in matters coming before it or arising within its territory. Certainly the rights, duties, and obligations imposed by the act of 1910’, whatever they may b.e, must he enforced according to the law of the state where the cause of action originated, as Congress has not provided specifically what are those duties and rights, nor provided how and in what courts they should be exercised and enforced.

The government of the United States and the governments of the several states, being independent and interdependent, neither of them having full governmental functions, and being composed, within the limits of a state, of the same citizens, it is of the utmost importance that rights be enforced; and, where the federal government has supreme power, but has not asserted it to its full extent, the state laws should supplement .the federal law so as to secure to all citizens of the country some remedy for wrongs and some plan for the enforcement of rights. And until necessarily there is a conflict, courts should not construe the law so as to deprive a person of his rights of property or person in the enforcement of obligations due him. We think the sound rule is to hold that the telegraph and telephone business now stands practically on the same plane of liability and obligation as railroads stood prior to the Carmack Amendment.

We have examined the authorities which take the contrary view, including Western Union Telegraph Co. v. Showers, in this state, and reach the conclusion that they have announced the wrong rule, and until the federal supreme court, which has final authority in this matter, shall decide otherwise, we hold that the state law applies to the telegraph and telephone business, even though it incidentally may affect interstate commerce, and the Showers Case is hereby overruled.

The court below having reached the contrary conclusion, the judgment is reversed, and the cause remanded.

Reversed and remained.

Stevens, J., dissents. Sykes, J., took no part.