Summary
finding that the plaintiff had presented sufficient evidence on the "good condition" element to survive summary judgment when the plaintiff presented testimony from a storage center manager that the machines at issue were in good working order before they were shipped
Summary of this case from Rush Indus., Inc. v. MWP Contractors, L.L.C.Opinion
CIVIL ACTION NO. 06-11168-DPW.
August 8, 2008
MEMORANDUM AND ORDER
Plaintiff Ted A. Center ("Center") filed this lawsuit against Roadway Express, Inc. ("Roadway"), an interstate trucking company, for allegedly damaging his woodworking equipment while transporting it from Texas to Massachusetts in June 2005. Roadway has filed a motion for summary judgment on grounds that Center lacks evidence to establish a prima facie case of liability. Roadway also claims that even if Center is able to establish a liability case, damages are limited to $13,115 for the shipment. I will deny summary judgment to Roadway on the prima facie liability issue and grant summary judgment on the liability limitation issue.
I. Facts
Center has worked in the woodworking business for over thirty years. On August 21, 1997 Center placed his woodworking equipment and other machinery in storage with the Sullivan Transfer Company in Dallas, Texas when he moved to the Boston area to pursue further education in the field of furniture and cabinet making. He had purchased the bulk of the equipment in the early 1980s to start his own shop. Most of the large equipment was from the 1940s era and was reconditioned as new when he purchased it. Center maintained no records of how much he paid for the equipment and has never had it appraised. Center paid Sullivan approximately $225 per month for about eight years to store his equipment.
In a letter dated April 14, 2005, Sullivan notified Center that it was going out of business and that Center had thirty days to move his items out of storage. Center was living in Massachusetts at the time. Around May 12, Center spoke on the telephone with Teia Rosier, a Sullivan employee, and asked her to arrange for the shipping of his woodworking equipment to Massachusetts. Rosier found several carriers, including Roadway, who gave her bids for shipping the equipment. She assured Center that Sullivan dealt with Roadway all the time, that Roadway was reliable, and that the shipping they offered was sealed trailer service. This meant that the equipment would be loaded on the Sullivan dock onto a trailer, the door would be closed and sealed, and would not be reopened again until it arrived at the shipping destination.
Roadway stated on the confirmation quotes it gave to customers that it limited its liability for cargo damage in proportion to the rates for shipment that it charges. The freight charge for Center's shipment was initially $2,238 and was later amended to $2,263.07. Roadway's quote for Center's shipment asserts that Roadway limited its liability to $1 per pound for the shipment with a maximum liability of $100,000. Roadway provided customers with options of increasing the amount of liability, including rates of $2.50, $5 or $10 per pound. Roadway would, however, have increased the price it charged for shipping the freight if the customer chose to increase the amount of liability.
Rosier told Center about the Roadway liability limitation provision of $1 per pound. Center told her that did not sound like very much, and she said she would look into insurance for the shipment, however, she apparently never followed up. Roadway states that neither Center nor Sullivan requested an increase in the amount of liability past the $1 per pound figure quoted on the confirmation for the shipment. Center accepted the conditions for shipping that Rosier described, authorizing her to complete the shipment.
On June 9, 2005, Sullivan loaded the shipment into a trailer, sealed it, and turned it over to Roadway, accompanied by a bill of lading. The bill of lading stated that the shipment contained "1 Lot of Used Machinery" that weighed 13,115 pounds. Center claims Rosier told him the shipment weighed substantially more than this over the telephone when he authorized her to ship it, but he cannot remember specifically how much she said it weighed and has no knowledge as to how much it actually weighed.
Neil Crawley ("Crawley"), the General Manager of Sullivan, assisted in the packaging and oversaw the transfer of the shipment from Sullivan to Roadway. He witnessed and oversaw Rosier, his associate, take photographs of the packaged machinery. Crawley assisted in loading the shipment into a sealed trailer, and asserts that "[w]hen the machinery was transferred to the care and custody of Roadway Express, it was in good, working condition."
Roadway transported the shipment from the Sullivan facility in Dallas, Texas to the Bormann Brothers ("Bormann") facility in Pepperell, Massachusetts. On the way to Massachusetts, the Roadway truck containing the shipment was involved in an accident that resulted in no property damage. The shipment was transferred onto another truck to proceed with the delivery. Roadway delivered the shipment to Bormann on June 20, 2005 and Center paid $2,263.07 for the delivery.
Bormann contacted Center upon the arrival of the equipment to warn him about the damaged condition of his shipment, stating that it did not want to unload the shipment without Center being present and recommended that he bring a camera when he arrived. This was the first time Center had seen the equipment since he placed it in storage in 1997. Center took photographs of the shipment. He paid Bormann $300 to unload the equipment and has since paid them $200 per month to store it.
Center sent a letter to Rosier on June 21, 2005 to notify Sullivan that his shipment was damaged upon arrival. Rosier then sent him the Roadway quote confirmation, which included the price quote and liability limitation, to show that the shipment was to be sealed trailer service.
Parts of most of the woodworking equipment were broken, bent or missing, though some items arrived in good condition. Center stated that all of his machinery was in great condition and was perfectly maintained prior to shipping. He states that the machinery he owned from the 1940's or 1950's is better and sturdier than any replacement for such machinery would be today.
Richard M. Akins ("Akins"), the president of Akins Machinery, Inc., a dealer in new and used woodworking machinery, has been assessing the fair market value of woodworking machinery for twenty three years. Center provided Akins with a list and photographs of the damaged equipment, and Akins stated that the equipment has no salvage value in that condition and had to be replaced. Akins stated that if the same woodworking equipment was in good condition, it would have been worth at least $15,000 or even as much as $20,000.
II. Summary Judgment Standard
Summary judgment is available "if the pleadings, discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c) (2007). When the nonmoving party has the trial burden of proof, the moving party may discharge its initial summary judgment burden by pointing out to this Court "that there is an absence of evidence to support the nonmoving party's case." Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). The burden then shifts to the nonmoving party to produce specific facts that show that a genuine issue of material facts exists. Anderson v. Liberty Lobby, 477 U.S. 242, 256 (1986). A "genuine factual issue" is one that "may reasonably resolved in favor of either party." Anderson, 477 U.S. at 250. This court must draw all justifiable inferences based on the evidence in favor of the nonmoving party. Adickes v. S.H. Kress Co., 398 U.S. 144, 158-159 (1970). "[T]he judge's function is not himself to weigh the evidence and determine the truth of the matter, but to determine whether there is a genuine issue for trial." Anderson, 477 U.S. at 250.
III. Discussion
Roadway contends that it is entitled to summary judgment because Center is unable to establish a prima facie case of liability. Roadway also states that it limited its liability for the shipment in question and likewise seeks summary judgment on this issue.
A. Prima Facie Case of Liability
Defendant seeks summary judgment contending that Center lacks evidence to show (1) that the woodworking shipment was in good condition when Sullivan gave it to Roadway in Dallas, and (2) the amount of damage to the equipment that Roadway caused.
The so-called Carmack Amendment codified at 49 U.S.C. § 14706 Termination Act of 1995, supercedes all state law in actions against common carriers for lost or damaged goods, and exclusively governs the liability of Roadway in this action. See Rini v. United Van Lines, Inc., 104 F.3d 502, 503, 506 (1st Cir. 1997); Intech, Inc. v. Consolidated Freightways, Inc., 836 F.2d 672, 677 (1st Cir. 1987); see also Adams Express Co. v. Croninger, 226 U.S. 491, 505 (1913). The law makes a carrier liable to the individual entitled to recover under the bill of lading for "actual loss or injury to the property" that the carrier causes during interstate transport of goods. 49 U.S.C. §§ 14706; 49 U.S.C. § 13501 (1995).
To establish a prima facie case of liability against a common carrier under the Carmack Amendment, the plaintiff has the burden to show "delivery in good condition, arrival in damaged condition, and the amount of damages." Missouri Pacific R. Co. v. Elmore Stahl, 377 U.S. 134, 138 (1964); D.P. Apparel Corp. v. Roadway Exp., Inc., 736 F.2d 1, 2 (1st Cir. 1984). If plaintiff succeeds in establishing this, "the burden of proof is upon the carrier to show both that it was free from negligence and that the damage to the cargo was due to one of the excepted causes relieving the carrier of liability." Missouri Pacific R. Co., 377 U.S. at 138 (citing various cases). Such excepted causes include "`(a) the act of God; (b) the public enemy; (c) the act of the shipper himself; (d) public authority; (e) or the inherent vice or nature of the goods.'" Id. at 137 (citing various cases).
First, I find that the plaintiff has presented sufficient evidence to create a genuine issue of fact for trial as to whether Sullivan delivered the woodworking equipment shipment to Roadway in good condition on June 9, 2005. Center testified that his woodworking equipment was in great, working condition when he placed it in storage with Sullivan in 1997. Crawley oversaw and assisted with the packaging of the shipment immediately before Sullivan turned it over to Roadway. He asserts that the machinery was in good, working condition at that time. I must construe the record in a light most favorable to Center and must refrain from weighing the evidence. See Adickes, 398 U.S. at 158-159; Anderson, 477 U.S. at 250. In doing so, I find that Center has plainly presented sufficient evidence to show that the equipment was in good condition to create a genuine issue of fact for trial.
Roadway claims that Center is unable to prove that the equipment was in good condition because he had not seen the equipment for eight years while it was in storage and because he has no knowledge whether and to what extent Sullivan handled the equipment during that time. These arguments may potentially cast doubt on the personal knowledge Center has regarding the condition at the time of shipment, but they fail to cast any doubt on the personal knowledge of Crawley on which Center relies. Crawley attests that the equipment was in good, working condition "when it was transferred to Roadway."
Second, Roadway does not contest that it delivered the woodworking equipment to Bormann in damaged condition. Bormann contacted Center when it received his shipment. It instructed him to come in to inspect the shipment and to take photographs prior to unloading it because of the damaged condition in which the equipment arrived. Center took pictures of the shipment at that time, and the photographs and testimony that the equipment is in fact damaged in those photographs is part of the record. Evidence of arrival in damaged condition is fully demonstrated and Roadway seems to have conceded this fact since it makes no argument contesting it.
Finally, plaintiff has shown that a genuine issue of fact exists regarding the amount of damage that occurred to the shipment in transit. The proper measure of damages is either the reduction in market value of the shipment from the time of departure from the origin to the time of arrival at the destination, or the replacement or repair costs for the harm defendant caused. Camar Corp. v. Preston Trucking Co., Inc., 221 F.3d 271, 277 (1st Cir. 2000) (citing Fredette v. Allied Van Lines, Inc., 66 F.3d 369, 372 (1st Cir. 1995); see also Chicago, M. ST. P. RY. Co. v. McCaull-Dinsmore Co., 253 U.S. 97, 100 (1920) (Holmes, J.). Common law principles of damages apply to claims under the Carmack Amendment. Camar Corp., 221 F.3d at 277, 279 (citing Hector Martinez Co. v. Southern Pac. Transp. Co., 606 F.2d 106, 108 (5th Cir. 1979)).
Akins, who has been a dealer in the new and used woodworking machinery business for twenty three years, attests that the woodworking machinery in question has no salvage value in its damaged condition. He also attests that if the same machinery had been in good and working condition, it would have a market value of at least $15,000 and possibly as much at $20,000. As discussed above, Center presented sufficient evidence to show that the machinery was in good condition. The fact that the machinery arrived in damaged condition is uncontested. Based on this evidence, Center may be able to show at trial that Roadway reduced the value of his shipment from $15,000-$20,000 to $0. Therefore, Center has created a genuine issue of fact as to the damages portion of his claim.
Center has adduced sufficient evidence to show that a genuine issue of fact exists with respect to each element of the requisite Carmack Amendment prima facie case that governs this claim. Accordingly, I will deny summary judgment to Roadway on this issue.
B. Limitation of Liability
Roadway also seeks summary judgment on its liability limitation provision, claiming that it the maximum liability it accepted for Center's shipment is $13,115. A common carrier may limited its liability for an interstate shipment "by written or electronic declaration of the shipper or by written agreement between the carrier and the shipper if the value would be reasonable under the circumstances surrounding the transportation." 49 U.S.C. § 14706(c)(1)(A). The reasonableness requirement is met if the carrier affords the shipper a "`fair opportunity'" to increase the amount of liability or coverage the carrier will accept for the shipment in exchange for paying a higher rate to ship the goods. Kemper Ins. Companies v. Federal Exp. Corp., 252 F.3d 509, 515 (1st Cir. 2001); Camar Corp., 221 F.3d at 276 (quoting Hollingsworth Rose Co. v. A-P-A Transp. Corp., 158 F.3d 617, 621 (1st Cir. 1998); see also Anton v. Greyhound Van Lines, Inc., 591 F.2d 103, 108 (1st Cir. 1978) (citing New York, N.H. H. R.R. Co. v. Nothnagle, 346 U.S. 128, 135 (1953)).
Center concedes that the liability limitation provision in Roadway's agreement with Center is valid. The concession is well founded.
First, Roadway successfully limited its liability to $1 per pound of the shipment weight. Roadway gave customers the option of increasing the amount of liability the carrier would accept for each shipment in exchange for paying a higher price for shipping. Center was aware of the $1 per pound liability limitation before agreeing to ship the machinery with Roadway and failed to request an increased amount of liability. Accordingly, I find that Roadway afforded Center a fair opportunity to increase the amount of liability in exchange for paying a higher rate for the shipment.
Second, Roadway has demonstrated that its liability is limited to $13,115 for Center's shipment. The bill of lading states that the weight of the shipment is 13,115 pounds. I recognize that Center stated in his deposition that he was under the impression, because Rosier allegedly told him so over the telephone, that the shipment weighed much more than that. However, he offers no admissible non-hearsay evidence to establish an alternate figure for the weight. Consequently, I conclude there is no genuine issue of disputed fact to contest that the weight of the shipment was 13,115 pounds, and that consequently the maximum liability Roadway accepted for the shipment is $13,115.