Eastern Coal & Export Corp. v. Norfolk & Western Railway Co.

138 S.E. 471, 148 Va. 140, 1927 Va. LEXIS 216
CourtSupreme Court of Virginia
DecidedJune 16, 1927
StatusPublished
Cited by4 cases

This text of 138 S.E. 471 (Eastern Coal & Export Corp. v. Norfolk & Western Railway Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Eastern Coal & Export Corp. v. Norfolk & Western Railway Co., 138 S.E. 471, 148 Va. 140, 1927 Va. LEXIS 216 (Va. 1927).

Opinion

Prentis, P.,

delivered the opinion of the court.

The Norfolk and. Western Railway Company, hereafter called the railway company, upon a claim for demurrage, has recovered of the Eastern Coal and Export Corporation, hereafter called the coal company.

The case is one of many growing out of delays in the transshipment of coal consigned to the coal company, care of Lambert’s Point Coal Exchange, at Norfolk, and there pooled'.

So much has been said with reference to such litigation, based upon the railway demurrage tariffs on coal for transshipment by vessel and pooling agreements, that much of detail will be omitted. In the few cases which will be cited these particulars have been sufficiently stated-

The reply brief for the coal company states that in its view it will only be necessary to deal with assignment of error No. 1, because if its contention made with respect to that assignment is adopted, this will finally dispose of the case. It is equally true that, if not adopted, it disposes of the ease in favor of the railway company. In presenting the case for the coal company from this point of view, it is conceded that there is no question now before this court concerning the reasonableness of the tariff, such as was presented to the Interstate Commerce Commission in Smokeless Fuel Company v. Norfolk & Western Railway Co., 85 I. C. C. 395. It is also conceded that there is no question of the mathematical correctness of the demur-rage, or that the demurrage is computed in accordance with the applicable tariff; or of the legality of the tariff; [143]*143or of the application of the so-called substitution rule, such as was reviewed by this court in Smokeless Fuel Co. v. Ches. & Ohio Ry. Co., 142 Va. 355, 128 S. E. 624. That these legal questions and their proper application to this case have been settled is apparent. Pan Handle Coal Co. v. Norfolk & Western Ry. Co., 143 Va. 865, 129 S. E. 321; Norfolk & Western Ry. Co. v. Emmons Coal Mining Co. (D. C.), 287 Fed. 168; Emmons Coal Mining Co. v. Norfolk & Western Ry. Co. (C. C. A.), 3 Fed. (2d) 525; and same case Adv. Ops. Sup. Ct. of the U. S., January 15, 1927, page 345, 46 S. Ct. 254, 71 L. Ed p. -; Meeker v. C. R. R. Co., 46 I. C. C. 657; Tidewater Coal Exchange, &c. v. B. & O. R. R. Co., 96 I. C. C. 612.

The claim is divided into three items.

It is conceded that the first item, 12,922.18, with interest, represents demurrage justly due, according to the principles established'in the cases referred to.

The second'item, $24,429.54, with interest, presents the most important and distinctive question which is here involved. A large amount of coal of the coal company was in the pool at Lambert’s Point, and some demurrage had accrued thereon. Then on November 6, 1920, the coal company exchanged 4,300 tons of its coal in pool five with the Algonquin Coal Company (a member of the exchange) for coal in other pools. The Algonquin Coal Company subsequently transferred this pool five coal to the Lake and Export Corporation, which latter company, with the knowledge and acquiescence of the Eastern Coal and Export Corporation, ultimately had it loaded in two vessels for transshipment.

For the coal company it is here claimed that its liability for demurrage on this coal ceased November 6, 1920, the date of its agreement with the Algonquin [144]*144Coal Company, while for the railway company it is claimed that the coal company cannot so escape its liability for demurrage, because expressly prohibited by the exchange or pooling agreement. The basis for the coal company’s contention is paragraph 3 of rule 3 (b) of Norfolk and Western Demurrage Tariff No. 4056.

This provides: “The dates shipments are transferred by written order and acceptance to another party shall be considered the date of release of the ear for the account of the original consignee, and subsequent detention shall be charged in the account of the new consignee, without any free time allowance.”

On the other hand, for the railway company it is claimed, that rule 6 of the exchange or pooling agreement controls, and- that the paragraph relied upon by the coal company has no application. • This Rule 6 provides:

“6. Delivery .Orders.—The exchange will neither record nor take cognizance of sales of tonnage between members, and, as to distribution of coal once in pool, will only execute orders of a member which call for delivery of tonnage to a vessel, or for reeonsignment by rail to the consuming consignee or retail dealer.”

So that there appears to be little dispute as to the facts, and the question presented is one of law—that is, as to the proper construction of the tariff and pooling agreement, in view of the undisputed facts.

This clause in the tariff (paragraph 3 of rule 3[b]) does not prescribe the demurrage charge. That is otherwise prescribed. All that this clause thereof refers to or undertakes to do, is this: In case there is a transfer of a shipment from an original to a new consignee, it provides that the obligation to pay the demur-rage thereafter accruing is, with the shipment, trans[145]*145ferred to and imposed upon the new consignee. This provision, however, necessarily presupposes and implies that the original consignee has the legal right so to transfer the shipment. If he has by contract legally parted with his right to do so, the clause in the tariff does not apply. It should be emphasized that there was no obligation on the coal company either to enter into the exchange or pooling contract, or to ship its coal to the Lambert’s Point Coal Exchange, as the joint agent of the coal shippers and the railway company, so as to ensure its prompt loading and transportation by water. It entered into this contract voluntarily, for a specific purpose and in the promotion of its own interests. It accepted its benefits and should not be permitted to relieve itself of the consequential burdens, except for most compelling reasons. Among these burdens was that imposed by rule 6 of the exchange agreement, which is relied upon by the railway company—i. e., that coal once in a pool could not be disposed of to any other members of the pool, but could only be disposed of by delivery to a vessel for transshipment by water or for reconsignment by rail to some consuming consignee or to a retail dealer.

The coal company undertook to disregard and violate this contract, claiming that the provision (Rule 6) is invalid as violative' of the tariff which recognizes such transfers.

We are of the opinion that there is no such conflict. The tariff refers to shipments which are both owned and absolutely controlled by the consignee, while the exchange refers to shipments which, while.owned, are not absolutely controlled, by the consignee, because that control has been limited; by the exchange agreement. This distinction was referred to by the Interstate Commerce Commission in Smokeless Fuel Com[146]*146pany v. Norfolk and Western Ry. Co., 85 I. C. C. 395, when this was said: “The tariff covered shipments to non-members of the exchange as- well as to members. Paragraph 3 of rule 3 (b) has reference to transfers of shipments by written order and acceptance, such as are occasionally made outside of any pooling arrangement.”

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Bluebook (online)
138 S.E. 471, 148 Va. 140, 1927 Va. LEXIS 216, Counsel Stack Legal Research, https://law.counselstack.com/opinion/eastern-coal-export-corp-v-norfolk-western-railway-co-va-1927.