Norfolk & Western Railway Co. v. Permaneer Inc.

320 F. Supp. 749, 1970 U.S. Dist. LEXIS 9854
CourtDistrict Court, E.D. Missouri
DecidedOctober 15, 1970
DocketNo. 69 C 4(3)
StatusPublished
Cited by1 cases

This text of 320 F. Supp. 749 (Norfolk & Western Railway Co. v. Permaneer Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. Missouri primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Norfolk & Western Railway Co. v. Permaneer Inc., 320 F. Supp. 749, 1970 U.S. Dist. LEXIS 9854 (E.D. Mo. 1970).

Opinion

MEMORANDUM OPINION AND ORDER

REGAN, District Judge.

Norfolk and Western Railway Company, a common carrier by railroad, brought this action to recover freight charges aggregating in excess of $180,-000 on shipments of 181 carloads of commodities made during the years 1966, 1967 and 1968 by the Wrightson Division of Permaneer Corporation. During the course of the trial, Permaneer conceded that as to 12 of the shipments it was indebted to Norfolk and Western in the sum of $6,748.87, the amount claimed with respect thereto. The issue as to the remaining 169 shipments is whether in preparing the bills of lading Permaneer correctly described the commodities shipped and applied the correct rate under applicable tariffs.

Tariff 17515-G sets forth local rules and charges governing transit privileges on lumber and other forest products in carload lots. The obvious purpose of transit privileges is to enable a shipper to obtain the benefit of a through rate on a commodity from point of origin to ultimate destination, even though there is a disruption in the movement of the shipment, the rate charged being that applicable to the outbound commodity in the form it leaves the transit station.

In 1964, Permaneer began utilizing its vinyl laminating process on various wood products at its plant located at Wright City, Missouri. After discussions between representatives of Permaneer and the railroad, Supplement 4 to Tariff 17515-G was issued November 20, 1964, effective December 23, 1964, granting certain transit privileges with respect to shipments of lumber (boards and sheets) originating at Crossett, Arkansas. Supplement 5 to the Tariff, which was issued June 17, 1965, effective July 19, 1965, added “plywood, boards and sheets” originating on the West Coast to the products entitled to [751]*751the transit privilege.1 These supplements authorize shipments of the designated products to be stopped in transit at Wright City for the privilege of “facing or finishing with decorative or protective covering” and subsequently re-forwarded to stations beyond the transit point at rates authorized in Item 170 2 plus a transit charge of 5 cents per 100 pounds. As a result of these supplements, defendant was enabled to unload shipments of flakewood and plywood (boards and sheets) at Wright City, apply its final laminating process, and then reship the improved product at the applicable through rate plus the transit charge.

Subsequently, Permaneer began the manufacture, at its Wright City plant, of the component parts of various articles of furniture (such as bookcases, record cabinets and storage cabinets) made of the vinyl laminated boards and sheets. However, none of these articles were assembled by defendant, the major portion of the manufacturing process being to bore, cut, groove and fit the boards and sheets. Permaneer then individually packaged all the component parts of each article including (in addition to the “manufactured” boards and sheets) all necessary hardware, a plastic edging, and a metallic resting glide (and in a relatively few instances, glass) together with printed instructions for assembly by the ultimate consumer.

On July 21, 1966, Supplement 7 to Tariff 17515-G, effective August 25, 1966, was issued at Permaneer’s instance, granting the additional transit privilege of “manufacturing” with respect to all its shipments of plywood, boards or sheets which were stopped in transit at Wright City. The privilege of “manufacturing” permitted defendant to drill, bevel, groove, mould and otherwise process the vinyl coated boards and sheets at Wright City, and still to take advantage of the through rate for boards and sheets.

The railroad makes no contention that any of the work done by Permaneer on the boards and sheets at Wright City was not within the privilege of “manufacturing”. The basic controverted question is whether defendant exceeded the transit privilege of “manufacturing,” thereby making inapplicable the “boards and sheets” rates and requiring the application of a furniture rate. As we have indicated, what was shipped by Permaneer were sealed cardboard cartons each of which contained all of the component parts and pieces of the article of furniture, some of the parts being of materials other than the boards and sheets, together with printed instructions for assembling the parts and pieces.

It is at once apparent that unless the description “boards and sheets” is defined in an applicable tariff to cover the articles admittedly shipped, the description “furniture, knocked down flat” in another but higher tariff rate is more apt. That the articles shipped precisely fit the description “furniture, knocked down flat”, is not seriously disputed by defendant. In truth, shipments made prior to the grant of the transit priv[752]*752ilege of “manufacturing” were described by defendant in the bills of lading and paid for as furniture. Moreover, the articles were sold by defendant to various retail stores and discount establishments as furniture (bookcases, storage cabinets and record cabinets) and in turn the stores sold the items to the public as “furniture,” to be assembled by the ultimate consumer.3 The sealed cardboard boxes containing the articles were imprinted with words such as “furniture”, “bookcase”, “storage cabinet”, and other similar designations. This was done at the insistence of Permaneer’s customers in order to make the article more saleable.

Defendant contends with respect to the eastbound shipments that Item 5795 of Tariff 2-F (and other comparable tariffs) applies and, considered together with the transit privileges, authorizes the lower “boards and sheets” rate. Item 5795 is applicable to “Board or Sheets, sawdust, ground wood, ground wood and ground bark mixed, or wood shavings, with or without added resin content not exceeding 10 per cent by weight, compressed, preservatively treated or not treated but not plasticized, veneered or not veneered, laminated or not laminated, edges glued or not glued together, flat, cut or not cut to dimensions and/or shaped but not assembled, grooved or indented or not grooved or indented, bored or not bored, edges plain or beveled, grooved, moulded, slotted or tongued (Subject to Notes 1, S, 9 and 12)”. In circumstances under which this Item applies, Note 12 permits the inclusion in the carload shipments of “nails or fasteners” not to exceed 5 per cent of the total weight. That the weight of such hardware is less than 5 per cent of the gross weight of each shipment is not in dispute.

As to the westbound shipments, defendant seeks to apply Item 7670 of Tariff 1-P. This Item, although otherwise comparable to Item 5795 of the eastbound tariff, contains no provision authorizing the inclusion of hardware in the shipment. We do not agree with defendant’s interpretation that simply because of the relatively “insignificant” weight of the hardware in comparison to the total weight of the shipment, this tariff Item should be construed to permit the inclusion of the hardware. We may not amend the tariff under the guise of construction.

However, without regard to whether the hardware (“nails or fasteners”) could for purposes of the boards and sheets rate, be included in the westbound shipments as well as in those eastbound, it is our view that nothing in either tariff authorized the inclusion of the plastic strips and metallic resting glides, or for that matter the printed assembly instructions.

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Bluebook (online)
320 F. Supp. 749, 1970 U.S. Dist. LEXIS 9854, Counsel Stack Legal Research, https://law.counselstack.com/opinion/norfolk-western-railway-co-v-permaneer-inc-moed-1970.