Menasha Paper Co. v. Chicago & Northwestern Railway Co.

241 U.S. 55, 36 S. Ct. 501, 60 L. Ed. 885, 1916 U.S. LEXIS 1800
CourtSupreme Court of the United States
DecidedApril 24, 1916
Docket696
StatusPublished
Cited by11 cases

This text of 241 U.S. 55 (Menasha Paper Co. v. Chicago & Northwestern Railway Co.) is published on Counsel Stack Legal Research, covering Supreme Court of the United States primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Menasha Paper Co. v. Chicago & Northwestern Railway Co., 241 U.S. 55, 36 S. Ct. 501, 60 L. Ed. 885, 1916 U.S. LEXIS 1800 (1916).

Opinion

Mr. Justice McKenna

delivered the opinion of the court.

Action for demurrage on cars in interstate and intrastate commerce, the grounds of recovery being set forth in separate counts.

After trial judgment was entered for the railway company in the sum of $1,374.63 and $49.60 costs, being in all the sum of $1,424.23.

The judgment was affirmed by the Supreme Court of the State.

*57 There is no dispute about the facts. The railway company operates a railroad at Menasha, Wisconsin, and elsewhere. The paper company is a corporation and has a place of business adjoining the railroad of the railway company and operated, for the purpose of unloading the cars delivered to it, a sidetrack which was contiguous to its mill and connected with the tracks of the railway company. A delay of forty-eight hours was allowed for unloading; after that time a demurrage charge of $1.00 per car per day was provided by the rules of the railway company.

The sidetrack could accommodate about seven- cars but had an actual capacity, as used during the times with which the action is concerned, of three or four cars, or possibly of five. As the paper company used the sidetrack, more cars could not have been placed upon it and unloaded than were actually placed upon it and unloaded, that is, about two or three cars a day.

Notice of the arrival of each car was given and acknowledged by telephone, and the railway company held the cars for unloading either at Menasha station or after-wards at Snell’s siding, eight miles south of Menasha. The paper company did not ask for them sooner than shown in the complaint because it could not handle any more cars than it did. And there was neither inability nor refusal on the part of the railway company to so place the cars when so ordered.

On March 14, 1908, the railway company, at the request of the paper company, notified its agents in Wisconsin and Michigan “until further advised” to discontinue to furnish equipment to load with bolts (logs less than 8 feet in length) for the paper company. This arrangement, called an “embargo,” did not run out until the close of the year and did not by its terms cover logs, nor was it modified afterwards to cover logs. The embargo was raised at the paper company’s request as to a certain *58 number of cars but was applied again and bolts were shipped in violation thereof and without any notice from the railway company to the paper company of the intention to ship the same, resulting in the arrival of cars in great numbers on certain days.

From these facts it was concluded by the referee, to whom the case was referred; the'trial court and the-Supreme Court that the paper company was estopped from urging any defense-other than the existence of the embargo and that the embargo was “illegal, contrary to public policy, and void"/’'

The latter conclusion the court based on the Hepburn Act (June 29, 1906, c. 3591, 34 Stat. 584) and certain sections of the Wisconsin laws.

The case is in short compass. The first cause of action was for intrastate demurrage on logs; the second cause of action was for interstate demurrage on logs and bolts. The so-called embargo is applicable only to the bolts. The Supreme Court disposed of it, as we have seen, on the ground that it was opposed to the policy of the Federal and state laws and justified the railway company in removing it. And the court found that there was no agreement that notice should be given of its removal. The removal of the embargo undoubtedly produced a congestion of cars beyond the ability of the paper company to handle on its sidetrack in its usuahway.

Two questions arise on the embargo: (1) Was it a violation of the Hepburn Act? (2) If so, could the railway company recover on account of the congestion of cars resulting from its removal? That act requires railroad companies to provide and furnish transportation to shippers upon reasonable request therefor, and to exact this duty of the railway company was the right of the shippers of the bolts to the paper company. Chicago, R. I. & Pac. Ry. v. Hardwick Elevator Co., 226 U. S. 426. This is not denied by the paper company nor did that company re *59 fuse to receive the ears. It is an inference from this that the paper company recognized it was under contract obligations to the shippers to receive the bolts; indeed, the whole case supposes it. It is alleged that “between June 3, 1908, and July 20, 1908, both dates included, plaintiff [the railway company], as the last carrier, carried and delivered in interstate commerce certain freight in carload” lots (meaning the bolts). There is no denial that they were so carried. If the shippers had a right to send the bolts necessarily the railway company was under a duty to transport them. The contention of the paper company, therefore, is tantamount to saying that the railway company performed its duty at the sacrifice of its rights. We are unable to concur in this view. The railway company violated its duty when it agreed to -the. embargo; it returned to its duty when it removed the embargo, and the rights which it exercised where those which it would have had if there had been no agreement between it and the paper company. The paper company had a direct remedy if it had been under no obligation to receive the bolts; it could have peremptorily notified the shippers not to send them, and such notice, under the circumstances, was an obvious course. It could not be protected from their receipt nor relieved from the obligation of their receipt by an agreement with the railway company against the duty which the law devolved upon the latter company. This duty it was deemed necessary to impose. It is positive and should be kept clear from agreements with others than the shippers which in effect stipulate for its violation. And this is the basis of our decision. If the paper company was under no obligation to receive the bolts from the shippers of them it undoubtedly had the right to effectually notify the railway company not to receive them for shipment on its account except as it should direct.' But, ás we have seen, it received the cars, and this, we have said, was a recognition of the rights of *60 the shippers. The cars did not arrive all at once, and a protest made at the first delivery of cars would have notified the railway company that the paper company was under no obligations to the shippers. And this certainly was the more imperative, as the railway company was the last carrier, the shipments originating on other roads.

It seems that in the state court the paper company did not contend so much against the raising of the embargo as against the failure to give notice of it, with the consequence, it was asserted and is asserted here, of the “dumping of a large number of cars” on the paper company “and causing the accrual of the alleged demurrage sued for.” But the contention is based upon the legality of the embargo, it being tantamount, it is insisted, to a consignee refusing freight consigned to it or the designation of those from whom it would receive freight.

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Bluebook (online)
241 U.S. 55, 36 S. Ct. 501, 60 L. Ed. 885, 1916 U.S. LEXIS 1800, Counsel Stack Legal Research, https://law.counselstack.com/opinion/menasha-paper-co-v-chicago-northwestern-railway-co-scotus-1916.