343 F.2d 887
LOUISVILLE & NASHVILLE RAILROAD COMPANY and Atlantic Coast
Line Railroad Company, Lessees of the Georgia
Railroad and Banking Company, Operating
under the trade name of
Georgia Railroad, Appellant,
v.
KNOX HOMES CORPORATION, Appellee.
No. 21507.
United States Court of Appeals Fifth Circuit.
April 1, 1965.
J. Walker Harper, Augusta, Ga., for appellant. Fulcher, Fulcher, Hagler & Harper, Augusta, Ga., of counsel.
John Bell Towill, Augusta, Ga., for appellee. Hull, Willingham, Towill & Norman, Augusta, Ga., Robert E. Knox, Thomson, Ga., of counsel.
Before BROWN and BELL, Circuit Judges, and SPEARS, District Judge.
JOHN R. BROWN, Circuit Judge.
Immediately involved here is the question whether the District Court properly directed a verdict for the Shipper and against the Carrier in the Carrier's claim for undercharges. The underlying issue is whether, under the applicable tariff, the Shipper was entitled to substitute carloads of Georgia-South Carolina lumber for the West Coast shipments of fir admittedly entitled to Transit privileges. Upon the completion of the Carrier's evidence before a jury whose presence seemed on all hands to have been a superfluous affectation, the Shipper moved for a directed verdict, and the Carrier followed suit, each party proceeding on the assumption that in the final analysis it was a question of law for the Court. The Trial Court granted the motion of the Shipper on two grounds. The first was on the construction of the Tariff. It seems to have run on a double track, either one of which was sufficient: (a) the tariff justified the Shipper's practice, or (b) if it did not, then the tariff was so ambiguous that the Shipper was entitled to the construction most favorable to it. The second ground was that the Carrier by identified Carrier records of waybills, freight bills, and the like had not sufficiently established the correct weight of the shipments involved to make out a prima facie case. We reverse the judgment in part and in effect render that portion for the Carrier. But as to the more troublesome question of tariff construction, we vacate the judgment and return that aspect to the District Court for initial determination by the Interstate Commerce Commission under the doctrine of primary jurisdiction.
The Transit Point is the Shipper's plant at Thomson, Georgia, situated on the Georgia Railroad. The initial inbound transit shipments came from the West Coast presumably under Transit Rates and billing for ultimate delivery to the Miami, Florida area. There is no question that the West Coast shipments fully qualified for the Transit Privileges if the lumber (or its products) after being held at the Transit Point had moved on to ultimate Destination Points. The problem arises, however, because the West Coast lumber did not move on. What the Shipper did was to substitute 119 cars of Georgia-South Carolina lumber. Of these shipments 107 cars moved via rail to Thomson, Georgia, from various points of origin, and the remaining 12 cars moved to Thomson from the mills by motor truck.
There is agreement that substitution is permitted. The dispute revolves around the tariff restrictions on substitution, what it is that makes a shipment eligible either as a substitute or to be substituted for, and the tariff consequences, rate adjustments, etc. to make a shipment partially eligible for Transit Privileges.
Although, as a sort of reflex to the proposition that merely because Judges can understand the operation of a device does not necessarily establish lack of invention, Hughes Tool Co. v. Varel Mfg. Co., 5 Cir., 1964, 336 F.2d 61, 63, n. 8, citing, Florence-Mayo Nuway Co. v. Hardy, 4 Cir., 1948, 168 F.2d 778, 781, we run a considerable risk that simplicity may sacrifice accuracy, we think it aids such understanding as is within our competence to consider the tariff broadly in a general way apart from each of the particular, and frequently confusing, parts. As thus sublimated, the tariff provides substantially the following. Transit privileges which consist of the forwarding to a specified Transit Point of carload shipments of lumber and forest products (including veneer, plywood and built-up wood) for storage, dressing, resawing, drying, sorting, inspection or conversion into specified wood products, and the forwarding of carload shipments to a subsequent and farther destination will be permitted at the specified Transit Points for such lumber originating at the specified Origin Territory Points and reshipped to specified Destination Territory Points. On shipments from Origin Points not within specified Origin Territory, Transit may be granted on the basis of the local rate to the nearest Point within the specified Origin Territory plus the rate from such Transit Point to Destination. Although a movement into, and a subsequent movement out of, the Transit Point is required to permit these special rates, it is not necessary to preserve the identity of the lumber and substitution is permitted under the tariff rules. The tariff rules restrict substitution to lumber entitled to transit privileges.
The Carrier's case is simple, even though the simplicity is beguiling. Almost as though it were operated by automatic block signals to open and close specific tariff subdivisions, the contention runs this way. Each of the shipments began at a place, such as Four Holes, South Carolina, which was not in Origin Territory. Consequently, such shipment was 'not entitled to Transit privileges.' That being so, the carload of lumber could not be substituted for a carload of West Coast lumber previously received by the Shipper at the Transit Point (Thomson, Georgia). However, the shipment is not perpetually banished beyond the pale of Transit Privilege eligibility. It may acquire at least limited eligibility if-- but only if-- an additional rate is paid as a combination of the local rate from the point of shipment to the nearest place on the route which is within the specified Origin Territory, plus the rate authorized 'from such transit origin' to destination. Indeed, the suit was for this difference between the through-transit rate as actually paid by the Shipper and the higher combination rate for the two short hauls required under Item 1(b).
But we do not think it is that simple.
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343 F.2d 887
LOUISVILLE & NASHVILLE RAILROAD COMPANY and Atlantic Coast
Line Railroad Company, Lessees of the Georgia
Railroad and Banking Company, Operating
under the trade name of
Georgia Railroad, Appellant,
v.
KNOX HOMES CORPORATION, Appellee.
No. 21507.
United States Court of Appeals Fifth Circuit.
April 1, 1965.
J. Walker Harper, Augusta, Ga., for appellant. Fulcher, Fulcher, Hagler & Harper, Augusta, Ga., of counsel.
John Bell Towill, Augusta, Ga., for appellee. Hull, Willingham, Towill & Norman, Augusta, Ga., Robert E. Knox, Thomson, Ga., of counsel.
Before BROWN and BELL, Circuit Judges, and SPEARS, District Judge.
JOHN R. BROWN, Circuit Judge.
Immediately involved here is the question whether the District Court properly directed a verdict for the Shipper and against the Carrier in the Carrier's claim for undercharges. The underlying issue is whether, under the applicable tariff, the Shipper was entitled to substitute carloads of Georgia-South Carolina lumber for the West Coast shipments of fir admittedly entitled to Transit privileges. Upon the completion of the Carrier's evidence before a jury whose presence seemed on all hands to have been a superfluous affectation, the Shipper moved for a directed verdict, and the Carrier followed suit, each party proceeding on the assumption that in the final analysis it was a question of law for the Court. The Trial Court granted the motion of the Shipper on two grounds. The first was on the construction of the Tariff. It seems to have run on a double track, either one of which was sufficient: (a) the tariff justified the Shipper's practice, or (b) if it did not, then the tariff was so ambiguous that the Shipper was entitled to the construction most favorable to it. The second ground was that the Carrier by identified Carrier records of waybills, freight bills, and the like had not sufficiently established the correct weight of the shipments involved to make out a prima facie case. We reverse the judgment in part and in effect render that portion for the Carrier. But as to the more troublesome question of tariff construction, we vacate the judgment and return that aspect to the District Court for initial determination by the Interstate Commerce Commission under the doctrine of primary jurisdiction.
The Transit Point is the Shipper's plant at Thomson, Georgia, situated on the Georgia Railroad. The initial inbound transit shipments came from the West Coast presumably under Transit Rates and billing for ultimate delivery to the Miami, Florida area. There is no question that the West Coast shipments fully qualified for the Transit Privileges if the lumber (or its products) after being held at the Transit Point had moved on to ultimate Destination Points. The problem arises, however, because the West Coast lumber did not move on. What the Shipper did was to substitute 119 cars of Georgia-South Carolina lumber. Of these shipments 107 cars moved via rail to Thomson, Georgia, from various points of origin, and the remaining 12 cars moved to Thomson from the mills by motor truck.
There is agreement that substitution is permitted. The dispute revolves around the tariff restrictions on substitution, what it is that makes a shipment eligible either as a substitute or to be substituted for, and the tariff consequences, rate adjustments, etc. to make a shipment partially eligible for Transit Privileges.
Although, as a sort of reflex to the proposition that merely because Judges can understand the operation of a device does not necessarily establish lack of invention, Hughes Tool Co. v. Varel Mfg. Co., 5 Cir., 1964, 336 F.2d 61, 63, n. 8, citing, Florence-Mayo Nuway Co. v. Hardy, 4 Cir., 1948, 168 F.2d 778, 781, we run a considerable risk that simplicity may sacrifice accuracy, we think it aids such understanding as is within our competence to consider the tariff broadly in a general way apart from each of the particular, and frequently confusing, parts. As thus sublimated, the tariff provides substantially the following. Transit privileges which consist of the forwarding to a specified Transit Point of carload shipments of lumber and forest products (including veneer, plywood and built-up wood) for storage, dressing, resawing, drying, sorting, inspection or conversion into specified wood products, and the forwarding of carload shipments to a subsequent and farther destination will be permitted at the specified Transit Points for such lumber originating at the specified Origin Territory Points and reshipped to specified Destination Territory Points. On shipments from Origin Points not within specified Origin Territory, Transit may be granted on the basis of the local rate to the nearest Point within the specified Origin Territory plus the rate from such Transit Point to Destination. Although a movement into, and a subsequent movement out of, the Transit Point is required to permit these special rates, it is not necessary to preserve the identity of the lumber and substitution is permitted under the tariff rules. The tariff rules restrict substitution to lumber entitled to transit privileges.
The Carrier's case is simple, even though the simplicity is beguiling. Almost as though it were operated by automatic block signals to open and close specific tariff subdivisions, the contention runs this way. Each of the shipments began at a place, such as Four Holes, South Carolina, which was not in Origin Territory. Consequently, such shipment was 'not entitled to Transit privileges.' That being so, the carload of lumber could not be substituted for a carload of West Coast lumber previously received by the Shipper at the Transit Point (Thomson, Georgia). However, the shipment is not perpetually banished beyond the pale of Transit Privilege eligibility. It may acquire at least limited eligibility if-- but only if-- an additional rate is paid as a combination of the local rate from the point of shipment to the nearest place on the route which is within the specified Origin Territory, plus the rate authorized 'from such transit origin' to destination. Indeed, the suit was for this difference between the through-transit rate as actually paid by the Shipper and the higher combination rate for the two short hauls required under Item 1(b).
But we do not think it is that simple. And, contrary to the importunities of the Shipper, 'we must resist the temptation to take the ambiguity route as an easy and quicker way out' -- and for the Shipper the cheaper way out.
Especially is this true when the claim of ambiguity rests essentially on the dubious proposition that from the strange terminology used, the traditional, highly sectionalized structure of the tariff, the result, resembling a mixture of a section of the Internal Revenue Code and a patent claim, Thermo King Corp. v. White's Trucking Service, Inc., 5 Cir., 1961, 292 F.2d 668, 675 n. 9, is simply impossible to understand. It rests on the doubtful basis that that which is not crystal clear to the judicial mind must perforce be ambiguous. This claims too much for the law, and certainly for Judges as its votaries. It ignores, too, the law's traditional approach which requires, both for the ambiguous and the unambiguous writing, that one seeking to ascertain the meaning must place himself as near as possible in the position of the parties. And the record in our case is way too sketchy both in testimony as to railroad practices and as to the provisions of the tariffs for us-- as nonrailroading Judges-- to divine with safety what was really meant. We must steel ourselves against easy interpretations which make sense. For whether one particular interpretation 'makes sense is beside the point.' Rather, it 'all depends on what kind of sense is being made-- abstract, contractual interpretation sense, or transportation-railroading sense,' Strickland Transp. Co. v. United States, 5 Cir., 1964, 334 F.2d 172, 178.
A brief consideration of the specific terminology of these tariff provisions will bear out these difficulties. Thus, the Carrier's interpretation necessarily reads Item 1(a) into Item 35-C(c) to determine what lumber is entitled to Transit Privileges. And yet Item 35-C(a) is expressly subject to Items 5, 30, and 90. Item 5 (note 7, supra) is the general definition of the term 'Transit Privileges' as referred to in Item 35-C(c). Yet it contains no limitation of the kind set forth in Item 1(a). On the contrary, it is Item 1 which incorporates Item 5, not Item 5 which incorporates Item 1. Unless Item 1(a) is read into both Item 35-C(c) and Item 5, there is no basis for applying Item 1(b) as the Carrier contends. On the other hand, that is putting a high premium on literalness.
At the same time a pretty good argument can be marshalled for reading Item 5 alone. The important thing is the forwarding of a carload of lumber to a Transit Point for storage, processing, or the like, and the forwarding of the carload (or its vicarious substitute) to a subsequent and farther destination. It is the planned movement in, the momentary stay at, and the movement out of the Transit Point which justifies these more favorable transportation privileges. This approach makes it difficult to accept the proposition as conceded by the Carrier (see notes 14 and 22, supra) that had the lumber been discharged and used in Thomson, the lower rate as originally billed (and paid) would be applicable. Particularly is this so since the question at issue here is transportation costs into Thomson, not the absence of transportation charges for the movement out of Thomson onto Miami.
Other factors are pertinent. One certainly worthy of at least some preliminary inquiry is the significance, if any, of the addition of subparagraph (c) in Item 35-C (note 16, supra) in contrast to the more simple provision in the original tariff (see note 15, supra). This is not just the ordinary legal question of the extent to which amendments can, or should, be interpreted in the light of the prior text. The more serious questions from a transportation policy standpoint involve the extent to which the amended provision is either customarily found in Transit Tariffs or is required by reason of some dominating policy consideration reflecting practices, specific rulings, or decisions of the regulatory agency, the ICC. We are left completely in the dark as to these and much more.
Obviously some of these alternative constructions are more plausible than others. Indeed, it is likely that there are even others, many perhaps even more plausible, which we have not even mentioned. And were the consequences left to these adversaries alone, we could pick a path through this tariffese. But the stakes are, or at least may be, much higher.
There is, first, a desirability of uniformity which runs through carrier tariff law. Second, and perhaps more important here, the Commission as well as the Courts recognize that Transit Tariff privileges are subject to much abuse and unless carefully policed may be the very instrument of forbidden discrimination, undue preference as between shippers, points, commodities, and the like.
Lurking in these words carrying their own transportation overtones are basic perils to a sound transportation policy. Lest these be overlooked or submerged, we think the Commission should first interpret and apply this tariff to the situation posed by this record.
We recognize, of course, that ordinarily tariff construction, like the interpretation of any other writing, is a typical judicial function for the Judge even though the divination of the script be a difficult one. Great Northern Railway Co. v. Merchants' Elevator Co., 1922, 259 U.S. 285, 42 S.Ct. 477, 66 L.Ed. 943; W. P. Brown & Sons Lumber Co. v. Louisville & N. Railroad Co., 1937, 299 U.S. 393, 57 S.Ct. 265, 81 L.Ed. 301. Likewise, primary jurisdiction will most frequently be employed where application of tariff provisions turns on factual evaluation of typically transportation matters such as commodity classifications. United States v. Western Pacific R. Co., 1956, 352 U.S. 59, 77 S.Ct. 161, 1 L.Ed.2d 126. But that decision reiterated the broad scope which Far East Conference v. United States, 1952, 342 U.S. 570, 72 S.Ct. 492, 96 L.Ed. 576, infused into the doctrine.
' Uniformity and consistency in the regulation of business entrusted to a particular agency are secured, and the limited functions of review by the judiciary are more rationally exercised, by preliminary resort for ascertaining and interpreting the circumstances underlying legal issues to agencies that are better equipped than courts by specialization, by insight gained through experience, and by more flexible procedure.' 352 U.S. at 64-65, 77 S.Ct. at 165, citing, 342 U.S. at 574, 575, 72 S.Ct. 492.
And manifesting no purpose to except from its reach the 'pure' question of tariff construction, the Court on that same date remanded United States v. Chesapeake & Ohio Ry. Co., 1956, 352 U.S. 77, 77 S.Ct 172, 1 L.Ed.2d 140, for consideration of the primary jurisdiction question by the Court of Appeals.
Even more significant was the action in Southwestern Sugar & Molasses Co., Inc. v. River Terminals Corp., 1959, 360 U.S. 411, 79 S.Ct. 1210, 3 L.Ed.2d 1334, which approved the earlier action of this Court in sending to the ICC the question of interpretation and legal validity of tariff provisions which purported to exculpate a common carrier tug from liability for loss or damage to shipperowned barges and cargo aboard. The dispute calling for transportation evaluation was not about evidentiary 'facts' in the occurrence giving rise to the claim or the status of the craft as carrier or shipper-owned. Rather, it was whether that were transportation policies reflected by tariff and statutory provisions which would make inapplicable the sweeping denunciation of exclupatory towage contracts in Bisso v. Inland Waterways Corp., 1955, 349 U.S. 85, 75 S.Ct. 629, 99 L.Ed. 911.
Although primary jurisdiction may properly, and should here, be invoked, Southwestern Sugar & Molasses also teaches quite positively that the judiciary is to complete its own homework. Matters not requiring agency evaluation are therefore to be determined by the Court. Conceivably the non-referred aspects might have to await receipt of the administrative determination, but here, as there, they are quite distinct and no delay is necessary or desirable. Consequently, we must make a judicial examination and doing so we reject the other basis on which the District Court granted the Shipper's motion for directed verdict.
The District Court held that the Carrier failed to make out a case on the weight of the shipments, and since the additional charges were geared to weights, there was a failure to establish a prima facie case even assuming the Carrier's construction of the tariff was correct.
In addition to the verified complaint which included five pages of incorporated exhibits listing in detail all pertinent data covering each of the 119 carloads, the Carrier offered in evidence, without objection as to authentication, file copies of the Freight Waybills kept by the Carriers in the regular course of business covering the movement of (a) the cars from point of origin into Thomson, Georgia, (b) the outward movement from Thomson, Georgia, to the destination points in the Miami, Florida, area, and (c) the corrected billing for the undercharges sued for.
These documents, having been properly authenticated and objections to authenticity having been categorically waived, were obviously admissible without limitation of use under the Business Records Act, 28 U.S.C.A. 1732. They were not only admissible, but they were enough to carry the day. And the Shipper's effort, whether belatedly or not, to negative a concession on correctness of weight did not affect either the admissibility or the judicial weight to be accorded to them. As there is no question that the record bore out that these papers were kept in the respective Carrier's regular course of business and used by them as the basis for further commercial action in relation to the movement of the shipments, the billing and payment of freight therefor, there is no merit to the objection now urged by the Shipper in its brief that none of the Carrier witnesses identifying the papers knew who weighed the shipments. Indeed, it is the purpose of the Business Records Act to dispense with the necessity of proving each and every entry by the person or persons actually making them. The probative reliability of these papers as proof of the matters reflected therein was established by the system under which they are made. It is the business record in the form regularly kept by the particular business and reliance thereon that gives the trustworthiness and hence legal admissibility to such records. Missouri Pacific R.R. Co. v. Austin, 5 Cir., 1961, 292 F.2d 415.
Moreover, these records were such that the Shipper was not free to even impugn their accuracy. They were not only admissible, they were binding on this particular Shipper for these shipments. This is because the Shipper had actually paid the charges as originally billed covering the movement from points of origin to Thomson, Georgia. In so doing, the Shipper placed its own imprimatur of accuracy on these very same weights. There was neither suggestion nor proof that having made payment based upon these weights in the regular course of its affairs, the Shipper had been misled or acted inadvertently or erroneously. Indeed, in view of the statute of limitations, 49 U.S.C.A. 16(3)(c), time had effectively cut off the Shipper's right of contest.
Under the peculiar circumstances of this case, these business records were admissible and merely proved again what the Shipper by its conduct had already demonstrated beyond question-- that the weights were those shown. The instructed verdict on this score should therefor have gone for the Carrier, not the Shipper, and the simple general denial in the answer cannot make this 'paper' issue into a real one. Cf. Bruce Construction Corp. v. United States for the use of Westinghouse Elec. Supply Co., 5 Cir., 1957, 242 F.2d 873, 878; Carss v. Outboard Marine Corp., 5 Cir., 1958, 252 F.2d 690, 693.
The result is that we reverse and render so much of the judgment as held the proof on weights inadequate. On this aspect, the District Court shall enter an appropriate order. The balance of the judgment as to the construction and application of the tariff is vacated with directions to the Trial Court to hold the cause in abeyance while the parties seek the views of the ICC in any form of proceeding which that body may deem appropriate and for further proceedings consistent with this opinion.
Reversed and remanded in part; vacated and remanded with directions in part.