Total Quality Logistics, L.L.C. v. Balance Transp., L.L.C.

2020 Ohio 620

• Court: Ohio Court of Appeals
• Decided: February 24, 2020
• Docket: CA2019-04-035
• Status: Published

Opinion

[Cite as Total Quality Logistics, L.L.C. v. Balance Transp., L.L.C., 2020-Ohio-620.]

IN THE COURT OF APPEALS

TWELFTH APPELLATE DISTRICT OF OHIO

CLERMONT COUNTY

TOTAL QUALITY LOGISTICS, LLC, :

Appellant, : CASE NO. CA2019-04-035

: OPINION - vs - 2/24/2020 :

BALANCE TRANSPORTATION, LLC, :

Appellee. :

CIVIL APPEAL FROM CLERMONT COUNTY COURT OF COMMON PLEAS Case No. 2017CVH000970

Calfee, Halter & Griswold LLP, David T. Bules, Alexandra R. Forkosh, 2800 First Financial Center, 255 East Fifth Street, Cincinnati, Ohio 45202, for appellant

Faulkner & Tepe LLP, John C. Scott, Tracy E. Schwetschenau, One West Fourth Street, Suite 2050, Cincinnati, Ohio 45202 and Tressler LLP, Joanna Maxwell, 6100 Center Drive, Suite 1175, Los Angeles, California 90045, for appellee

RINGLAND, J.

{¶ 1} Appellant, Total Quality Logistics, LLC ("TQL"), appeals a decision of the

Clermont County Court of Common Pleas, denying its motion for summary judgment and

granting summary judgment in favor of appellee, Balance Transportation, LLC ("Balance").

For the reasons detailed below, we affirm the trial court's decision. Clermont CA2019-04-035

{¶ 2} TQL is a freight broker. As such, TQL's customers pay TQL for arranging the

transportation of their products with a carrier, and TQL then pays the carrier to transport the

product. Balance is a carrier that transports such products. In August 2009, TQL and

Balance entered into a broker-carrier agreement ("Agreement") that provided terms for the

transportation of TQL's customers.

{¶ 3} In June 2016, in accordance with the Agreement, TQL arranged with Balance to

deliver one truckload of granite for its customer C&C North America, Inc. ("C&C") from La

Porte, Texas to Sun City Granite ("Sun City") in El Paso, Texas. TQL issued a rate

confirmation for the load, which Balance accepted, thus confirming its agreement to transport

the load. There is no dispute that Balance took possession of the granite in good condition.

{¶ 4} On June 17, 2016, Balance's driver, Adrian Bernal, arrived at Sun City. When

he arrived, Bernal parked his truck on the street in front of Sun City's building and went

inside. There, Bernal met Sun City's representative. Bernal presented the bill of lading to

Sun City's representative who signed, dated, and returned the bill of lading to Bernal. Bernal

then sent an electronic copy of the bill of lading to Balance. The Sun City representative then

instructed Bernal to move his truck forward a short distance from where he had parked and

that "they were going to unload me."

{¶ 5} Bernal returned to his truck, moved it forward a few feet as instructed, and then

placed the truck in park. When he exited the vehicle, Bernal unstrapped the load from the

flatbed trailer and placed the straps back inside his truck. Bernal then watched as the Sun

City employees began unloading the granite.

{¶ 6} At some point, Bernal reentered his truck's cabin. Bernal remained there for a

few minutes until he heard a loud noise. When he stepped out of the cab, Bernal saw that

the slabs of granite located in the front of the trailer were falling off the truck, which, in turn,

caused slabs toward the rear of the trailer to begin falling too. While this was occurring, -2- Clermont CA2019-04-035

Bernal testified that he observed a forklift, being used by a Sun City employee, backing away

from his trailer holding an unbroken slab of granite.

{¶ 7} After the incident, the Sun City representative who signed the bill of lading

asked Bernal to return the bill to her. Bernal testified that the Sun City representative

attempted to alter the bill of lading that she had already signed. After the Sun City

representative made the changes to the bill of lading, Bernal made a written statement on the

bill of lading. The Sun City representative then wrote her own statement below Bernal's.

{¶ 8} Following these events, TQL claimed that Balance breached the Agreement by

failing to properly deliver the cargo or refusing to pay TQL. Specifically, TQL alleged that

Balance failed to timely and properly deliver the load of granite slabs to the intended

destination in good condition as required by the Agreement.

{¶ 9} C&C submitted a cargo claim to TQL for the cost of its damaged cargo in the

amount of $30,641.11. TQL paid that amount to C&C and, in exchange, C&C released and

assigned its claim against Balance to TQL. Under an offset provision in the Agreement, TQL

applied an open invoice of $1,900 owed to Balance as partial payment, thus reducing TQL's

claim to $28,741.11.

{¶ 10} On August 7, 2017, TQL filed a complaint seeking $28,741.11 for recovery

under the Carmack Amendment, breach of contract, and breach of bailment duty. Balance

filed a counterclaim seeking recovery of the $1,900 open invoice, alleging TQL

misappropriated said funds for the claimed loss. Both parties moved for summary judgment.

In a final judgment entry dated April 1, 2019, the trial court denied TQL's motion for

summary judgment and granted summary judgment to Balance. TQL now appeals, raising

three assignments of error for review.

{¶ 11} Assignment of Error No. 1:

{¶ 12} THE TRIAL COURT ERRED AS A MATTER OF LAW WHEN IT FAILED TO -3- Clermont CA2019-04-035

APPLY THE EXPRESS LANGUAGE OF THE AGREEMENT (PARAGRAPH 8), WHICH

REQUIRES DELIVERY OF THE SHIPMENT TO THE CONSIGNEE BEFORE THE

CARRIER'S CARGO CLAIM LIABILITY ENDS.

{¶ 13} Assignment of Error No. 2:

{¶ 14} THE TRIAL COURT ERRED AS A MATTER OF LAW BY FAILING TO APPLY

THE PROVISION IN PARAGRAPH 8 OF THE AGREEMENT STATING THAT ALL

LIABILITY STANDARDS AND BURDENS OF PROOF SHALL BE GOVERNED BY THE

CARMACK AMENDMENT.

{¶ 15} Assignment of Error No. 3:

{¶ 16} THE TRIAL COURT ERRED BY FAILING TO PROPERLY CONSIDER ALL

EVIDENCE OF DELIVERY FAILURE WHEN GRANTING BALANCE TRANSPORTATION'S

MOTION FOR SUMMARY JUDGMENT AND DENYING TQL'S MOTION FOR SUMMARY

JUDGMENT ON ALL OF TQL'S CLAIMS.

{¶ 17} TQL's assignments of error are interrelated and will be addressed together.

TQL argues the trial court erred by denying its motion for summary judgment and instead

granting summary judgment to Balance. In so doing, TQL argues it is entitled damages

under three theories of liability: (1) a cargo damage claim under the Carmack Amendment,

(2) a breach of contract claim pursuant to the terms of the Agreement, and (3) breach of

bailment duties.

{¶ 18} This court reviews summary judgment decisions de novo. Ludwigsen v.

Lakeside Plaza, L.L.C., 12th Dist. Madison No. CA2014-03-008, 2014-Ohio-5493, ¶ 8.

Pursuant to Civ.R. 56(C), summary judgment is proper when (1) there are no genuine issues

of material fact to be litigated, (2) the moving party is entitled to judgment as a matter of law

and, (3) when all evidence is construed most strongly in favor of the nonmoving party,

reasonable minds can come to only one conclusion, and that conclusion is adverse to the -4- Clermont CA2019-04-035

nonmoving party. Zivich v. Mentor Soccer Club, Inc., 82 Ohio St. 3d 367, 369-70 (1998).

{¶ 19} The moving party bears the initial burden of informing the court of the basis for

the motion and demonstrating the absence of a genuine issue of material fact. Robinson v.

Cameron, 12th Dist. Butler No. CA2014-09-191, 2015-Ohio-1486, ¶ 9. Once this burden is

met, the nonmoving party has a reciprocal burden to set forth specific facts showing there is

some genuine issue of material fact yet remaining for the trier of fact to resolve. Id. In

determining whether a genuine issue of material fact exists, the evidence must be construed

in favor of the nonmoving party. Vanderbilt v. Pier 27, L.L.C., 12th Dist. Butler No. CA2013-

02-029, 2013-Ohio-5205, ¶ 8.

{¶ 20} Pursuant to well-established principles of transportation law, cargo damage

claims against interstate motor carriers are determined under the Carmack Amendment.

Total Quality Logistics, L.L.C. v. Red Chamber Co., 12th Dist. Clermont No. CA2016-09-062,

2017-Ohio-4369, ¶ 11. The Carmack Amendment provides that:

[a] carrier providing transportation or service * * * shall issue a receipt or bill of lading for property it receives for transportation under this part. That carrier and any other carrier that delivers the property and is providing transportation or service * * * are liable to the person entitled to recover under the receipt or bill of lading. The liability imposed under this paragraph is for the actual loss or injury to the property caused by (A) the receiving carrier, (B) the delivering carrier, or (C) another carrier over whose line or route the property is transported in the United States * * *.

Id., citing 49 U.S.C. 14706(a)(1). Accordingly, the Carmack Amendment creates a federal

statutory remedy on a bill of lading against both the originating and destination carrier. Id.

To assert a prima facie case pursuant to the Carmack Amendment, one must demonstrate:

(1) delivery to the carrier in good condition, (2) delivery failure or arrival in damaged

condition, and (3) the amount of damages caused by the loss. Id., citing Camar Corp. v.

Preston Trucking Co., 221 F.3d 271, 274 (1st Cir.2000).

{¶ 21} In addition to claims under the Carmack Amendment, TQL also raises a breach -5- Clermont CA2019-04-035

of contract claim against Balance pursuant to the terms under the Agreement. Pursuant to

Paragraph 8 of the Agreement:

Unless otherwise agreed in writing, CARRIER shall become fully responsible/liable for the freight when it takes/receives possession thereof, and the trailer(s) is loaded, regardless of whether a bill of lading has been issued, and/or signed, and/or delivered to CARRIER, and which responsibility/liability shall continue until delivery of the shipment to the consignee and the consignee signs the bill of lading or delivery receipt.

TQL claims that Paragraph 8 mandates two conditions before the carrier's liability ends: (1)

delivery of the shipment to the consignee, and (2) consignee's signature on a bill of lading or

delivery receipt.

{¶ 22} Finally, TQL also claimed Balance breached its bailment duties. The general

and accepted rule in bailment cases is that the bailee has two basic duties to the bailor: (1)

he must exercise ordinary care in safeguarding the bailed property; and (2) he must return

the bailed property, or the product thereof, undamaged. If the bailee fails to redeliver the

bailed property, he has breached both of these duties and is liable to the bailor, in tort and

contract, for the value of the property. In order to establish a prima facie case, the bailor

must prove: (1) the existence of a bailment contract; (2) the delivery of the bailed property to

the bailee; and (3) the failure of the bailee to redeliver the bailed property undamaged at the

termination of the bailment. Collins v. Click Camera & Video, Inc., 86 Ohio App.3d 826, 831

(2d Dist.1993)

{¶ 23} Following review, we find the undisputed evidence supports the finding that

Balance successfully delivered the cargo and Sun City signed the bill of lading prior to any

damage to the cargo. Thus, the loss of cargo occurred after the risk of loss had shifted from

Balance. This finding is dispositive as to all claims raised by TQL.

{¶ 24} On appeal, TQL cleverly dissects the trial court's decision to argue that the trial

court ignored the "delivery" requirement and instead placed undue emphasis on the signed -6- Clermont CA2019-04-035

bill of lading. TQL maintains that, although Sun City's representative signed the bill of lading,

Balance had not yet successfully delivered the cargo. In so doing, TQL denies that delivery

was complete when Bernal parked his truck in the street or when the bill of lading was

signed. TQL also alleges that delivery could not have been complete at the signing of the bill

of lading because Bernal still had to move the truck, repark the truck, and unstrap the granite.

{¶ 25} However, contrary to TQL's argument, we do not find the trial court merged or

eliminated the delivery requirement. Though the parties present argument as to the precise

moment that delivery occurred, the operative facts are straightforward and not in dispute. As

noted above, Bernal accepted and transported the cargo from its original destination to Sun

City. Since there was no place to park his truck, Bernal testified that he parked in the street

near the sidewalk and went into the office where a Sun City representative signed and dated

the bill of lading and gave it back to him. Bernal then sent a copy of the bill of lading to

Balance. The Sun City representative then instructed Bernal to move his truck forward a

short distance and Bernal understood that "they were going to unload me." In accordance

with the instructions, Bernal testified that he moved his truck up a few feet and parked the

truck. Thereafter, Bernal stated that he unstrapped the load from the flatbed trailer and

placed the straps inside the truck's cabin. Up until this point, there is no dispute that the

cargo was in good condition.

{¶ 26} Soon thereafter, Sun City began unloading the granite from the truck.

Ultimately, the granite was badly damaged during the unloading process. However, since the

damage occurred subsequent to delivery and receipt of the signed bill of lading, we agree

with the trial court that Balance was no longer responsible for the risk of loss in accordance

with the Carmack Amendment and the parties' contractual and bailment obligations. As a

result, we find the trial court appropriately granted summary judgment in favor of Balance.

-7- Clermont CA2019-04-035

{¶ 27} Finally, we note that TQL argues that its claim for breach of bailment duty must

be reversed because Balance allegedly did not move for summary judgment or present

argument of evidence on that claim. This court has previously stated, "[a] party seeking

summary judgment must specifically delineate the basis upon which summary judgment is

sought in order to allow the opposing party a meaningful opportunity to respond." Total

Quality Logistics, 2017-Ohio-4369 at ¶ 9; Total Quality Logistics, L.L.C. v. JK & R Express,

L.L.C., 12th Dist. Clermont No. CA2018-05-034, 2019-Ohio-20, ¶ 25. "A trial court, generally,

may not sua sponte grant summary judgment upon grounds not raised by the prevailing

party." Id. However, a trial court does not deprive a party of a meaningful opportunity to

respond where the party has notice of an issue. Ballinger v. Leaniz Roofing, Ltd., 10th Dist.

Franklin No. 07AP-696, 2008-Ohio-1421, ¶ 22.

{¶ 28} TQL's claim that Balance did not move for summary judgment on the bailment

claim is contradicted by the record. Balance's motion clearly states that it sought summary

judgment on all claims including specific reference to the breach of bailment duties that TQL

complains of on appeal. Furthermore, since Balance argued that it had successfully

delivered the cargo and had a signed bill of lading, TQL was on notice that its claim for

breach of bailment duty was at issue. As a result, we find TQL's three assignments of error

are without merit and are hereby overruled.

{¶ 29} Judgment affirmed.

HENDRICKSON, P.J., and PIPER, J., concur.

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