UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT
decided: February 20, 1973.
BLUE BIRD FOOD PRODUCTS CO., APPELLANT,
BALTIMORE & OHIO RAILROAD COMPANY
(D.C. Civil Action Nos. 70-1699, 70-1744, 70-1880 and 70-2661) Appeal from the United States District Court for the Eastern District of Pennsylvania. Resubmitted under 3rd Cir. Rule 12(6) on November 20, 1972, as a result of Orders of July 19, 1972, July 28 1972 and October 30, 1972.
Biggs, Van Dusen and Aldisert, Circuit Judges. Aldisert, Circuit Judge (dissenting).
Author: Van Dusen
Opinion OF THE COURT
VAN DUSEN, Circuit Judge.
Blue Bird Food Products Co. ("Blue Bird") appeals from the district court's entry of judgment for the Baltimore & Ohio Railroad Company ("B & O") with respect to four actions filed by Blue Bird against B & O.*fn1 Blue Bird claimed damages from B & O under the Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. § 20(11), in connection with four carloads of fresh hams shipped to it from a midwest packing company via the B & O.*fn2 After a non-jury trial extending through three days, the district court entered judgment in favor of B & O, apparently on the ground that Blue Bird had not made out a prima facie case. For the reasons to be stated, we will vacate the judgment and remand the case to the district court for further proceedings consistent with this opinion.
In Missouri Pacific Railroad Company v. Elmore & Stahl, 377 U.S. 134, 12 L. Ed. 2d 194, 84 S. Ct. 1142 (1964), the Court set forth the circumstances in which a carrier may be held liable for damages pursuant to 49 U.S.C. § 20(11):
"Under federal law, in an action to recover from a carrier for damage to a shipment, the shipper establishes his prima facie case when he shows delivery in good condition, arrival in damaged condition, and the amount of damages. Thereupon, 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." 377 U.S. at 138. (Emphasis added.)
The disagreement between the parties to the instant appeal revolves around the first requirement for a prima facie case set forth in Elmore & Stahl, supra, that is, whether the hams were in good condition when delivered from the shipper to the initial carrier.
Blue Bird introduced no direct testimony before the district court that the hams involved in these suits were delivered to the carrier in good condition. Instead, Blue Bird proposed to satisfy this requirement by the introduction into evidence of the bill of lading for each of the four ham shipments. The following language appeared in each of the four bills of lading:
"RECEIVED, subject to the classifications and tariffs in effect on the date of the issue of this Bill of Lading, . . . the property described below, in apparent good order, except as noted (contents and condition of contents of packages unknown) . . . ." (Emphasis added.)
The "property" referred to in this language was variously described in the body of each bill of lading as "4 LONG HOOKS 58 RACKS" weighing 40046 pounds,*fn3 "2527 pea Fresh Meats" weighing 36047 pounds,*fn4 "1 LOT GRN MT PK CUTS" weighing 39712 pounds,*fn5 and "loose fresh pork picnics" weighing 39478 pounds.*fn6 None of the bills of lading listed an exception to the "apparent good order" of the hams when delivered to the initial carrier. Three of the four bills of lading indicated that the hams were being shipped pursuant to "Plan 2-1/4"; the fourth did not indicate a routing plan.*fn7
In Tuschman v. Pennsylvania Railroad, 230 F.2d 787 (3d Cir. 1956), this court held that a representation in a bill of lading that goods were received "in apparent good order" establishes a prima facie case of delivery in good order with respect to all aspects of the goods which were open to inspection and visible, but that the carrier may show that the alleged damage was caused in whole or in part by a condition which was not apparent when it received the goods:
"The acknowledgment by the bill of lading of the crane's apparent good order was prima facie evidence that, as to all parts which were open to inspection and visible, the crane was in good order at the point of origin. This did not preclude the railroad from showing that the alleged damage in whole or part proceeded from some cause or causes which existed, but which were not apparent when it received the crane." 230 F.2d at 791.
See also Nelson v. Woodruff, 66 U.S. (1 Black) 156, 160, 162, 17 L. Ed. 97 (1861). This evidentiary rule set forth in Tuschman is consistent with the language contained in the bill of lading, since this language represents only that the goods were received from the shipper in "apparent" good order; any defects in those parts of the goods which were not open to inspection and visible would presumably not be "apparent" to the carrier and thus would not be included within the carrier's representation.
The district court, however, concluded that the "apparent good order" representation in the bill of lading did not create a prima facie case with respect to the four ham shipments involved in the case sub judice. The basis for this judgment by the district court was its implicit finding that in these four cases the shipper loaded the hams in a trailer provided by the shipper and then "sealed" the trailer before delivering it back to the carrier for shipment to the consignee.*fn8 The district court determined that when merchandise is delivered to a carrier in a "sealed" trailer it is not "open and visible,"*fn9 and held that in these circumstances the consignee who sues the carrier for damage to the goods cannot establish his prima facie case by means of the "apparent good order" representation in the bill of lading but must instead "establish by direct evidence that the goods were delivered to the carrier in good order." 329 F. Supp. at 1118.
After the initial argument in this case and the filing of majority and dissenting opinions, which were vacated by the panel following consideration of a Petition for Rehearing, a pre-hearing conference was held in September 1972*fn10 and, thereafter, a supplemental stipulation was filed at the direction of this court (see F.R.A.P. 10(e)) amplifying the description of Plan 2-1/4,*fn11 which had been contained in the trial court record in a one-sentence stipulation (see note 8 above).
Because the comments of counsel at the September pre-hearing conference (see note 8 above) and the Stipulation and statements*fn12 thereafter filed make clear that there is no agreement between counsel on the facts concerning the sealing of these trailers and the existence or nonexistence of a "custom in the industry for the party loading the shipment into the trailer to place its seal upon the trailer,"*fn13 we have concluded that the equivocal last sentence of Mr. Roeder's testimony quoted in note 8 above does not constitute a sufficient evidentiary basis to support a finding that these trailers were sealed in view of the burden resting on the carrier to come forward with evidence showing a sealing of the trailers, making the condition of their contents non-apparent when received, under Tuschman above at page 4. Since 1966 Mr. Roeder has been assigned to Philadelphia and the trailers were delivered to the carrier in the midwest in 1968. As stated by Judge Aldisert, speaking for the court, in Krasnov v. Dinan, 465 F.2d 1298, 1302 (3d Cir. 1972), a finding bearing "no rational relationship to the supporting evidentiary data" is clearly erroneous.*fn14 Hence there was no proper basis for the conclusion of the district court that no part of the contents of the trailers was "open and visible,"*fn15 as well as the conclusion that the shipper cannot establish his prima facie case by means of the "apparent good order" representation in the bill of lading.*fn16
The district court received evidence on many factual issues which it did not determine*fn17 because of its findings that the contents of the trailer were not open and visible. For example, there was testimony indicating that a visual inspection at the point of shipment would not have disclosed the defects in the hams because spoilage is caused by a micro-organism not apparent to the naked eye, even though present in sufficient quantity to effect such spoilage. This contention is opposed by plaintiff-appellant. Also, because of the rear door on the trailer and the manner of loading, there was testimony that only the hams adjacent to those doors would have been subject to examination.
For the foregoing reasons, the district court judgment will be vacated and the case remanded for further proceedings consistent with this opinion.
ALDISERT, Circuit Judge (dissenting).
This is the second time this panel has considered this appeal. When it was first before us, the majority filed an opinion reversing the district court, charging that court with making a finding which was clearly erroneous. I filed a dissenting opinion. Following a petition for rehearing, there was a reconsideration by the same panel. The majority now find as clearly erroneous that which they specifically found in their first opinion as "not clearly erroneous." I again dissent. This time I dissent not only from the conclusion reached by the majority but also the method utilized to reach it.
This appeal requires review of a non-jury determination that a shipper failed to establish a prima facie case that shipments of hams were in good condition at the time of delivery to a railroad carrier. At trial, the shipper relied upon an acknowledgment in the railroad's bill of lading that the goods were "in apparent good order." The railroad contended that this acknowledgment in the bill of lading fails to satisfy the prima facie evidence rule because the phrase refers only to shipments "which were open to inspection and visible," Tuschman v. Pennsylvania Railroad Co., 230 F.2d 787, 791 (3d Cir. 1956), whereas here the hams were received by the railroad in sealed trailers.
The district court found that the goods were loaded into trailers by the shippers, and that these trailers were then sealed and placed on the railroad's freight cars for transportation. Based on its finding that the trailers were sealed, the court concluded that the railroad was not bound by the "apparent good order" statement on the bill of lading because "where merchandise is sealed in a trailer . . . the contents are not open and visible." 329 F. Supp. 1118.
The majority determine that application of the clearly erroneous rule dictates rejection of this critical finding. When this appeal was before this panel for original consideration, the majority stated that "the district court's finding that the trailers were 'sealed' by the shipper before delivery to the carrier is supported by substantial evidence and is not clearly erroneous." The majority properly observed in their first opinion that the "later stipulation of the parties concerning Plan 2-1/4 did not by its terms negate the testimony of Mr. Roeder." The majority now hold there is not "a sufficient evidentiary basis to support a finding that these trailers were sealed." (page 107.)
The majority attempt to justify this oscillation by ascribing some significance to certain statements made by appellate counsel, not at trial in the district court, but adduced at a pre-argument hearing conducted after the original decision by this court, thirteen months after the district court trial took place. I am in total disagreement with this approach and would affirm the judgment of the district court.
What divides this court, after reconsideration, is basically the same difference in jurisprudential philosophy which divided it upon initial consideration. Ours is a fundamental difference in what we perceive to be the appropriate role of an appellate court in reviewing facts found by a trial court sitting without a jury. Regretfully, there is very little in the approach taken by the majority with which I can generate even a modicum of agreement.
The district court observed:
Critical to our decision are these facts. The rail carrier furnishes a piggyback trailer to the shipper, who cools and loads the shipment in a trailer which he is required to pre-cool. The shipper then seals the trailer. The trailer is then delivered to the piggyback train for cross country transit.
329 F. Supp. at 1117-1118.
The majority view, as clearly erroneous, the finding that the trailers were sealed. This was an important finding, for it was on this basis that the district court was able to draw the distinction "between those cases in which the merchandise being shipped were open to inspection and visible. Tuschman v. Pennsylvania Railroad Co., [230 F.2d 787, 3d Cir. 1956], and a situation wherein a loaded and sealed trailer is delivered to a carrier. Lincoln Farm Products Corp. v. Central Railroad Co. of New Jersey [81 N.J. Super. 161, 195 A.2d 200 (1963)]." 329 F. Supp. at 1118.
I find sufficient evidence in the record to sustain the trial court's finding that the trailers were sealed. As the majority concede: (1) the shipments were made under "Plan 2-1/4" (page 104); and (2) it was the uncontradicted testimony of Mr. Roeder, a witness for the railroad: "In a plan two and a quarter, the shipper would affix the seal to the rear door, that trailer would be received at the ramp, or the trailer received under seal."
Notwithstanding the uncontradicted record before the district court, the majority would by judicial fiat distort the trial record and infect it with dubious matters adduced at a F.R.A.P. 33 pre-hearing conference before an appellate court. With all due respects, I cannot detect the faintest tint of the relevancy of a post-trial, post-appellate argument disagreement "between counsel on the facts concerning the sealing of these trailers." The function of an appellate court is to review only the record which was before the district court in order to determine whether that court committed error. Thus, I consider it highly improper for an appellate court to consider any evidence, stipulation, or statements of counsel which were not before the trial court at the time the decision under review was made. F.R.A.P. 10. Hunt v. Local Board No. 197, 438 F.2d 1128, 1146 (3d Cir. 1971), (dissenting opinion, Aldisert, J., joined by Van Dusen, J.).
Yet, that is precisely what the majority has done in reaching its conclusion. In an attempt to fashion some basis for the conclusion that there was insufficient evidence at trial "to support a finding that these trailers were sealed" (page 107), the majority rely on matters presented to an appellate court which were not before the district court. They rely on "comments of counsel" and "the Stipulation and statements thereafter filed [which] make clear there is no agreement between counsel on the facts concerning the sealing of these trailers and the existence or non-existence of a 'custom in the industry for the party loading the shipment into the trailer to place its seal upon the trailer,' . . ." (pages 106-107.) Moreover, even if such a procedure did not offend my concepts of appellate review, the substance of post-trial disagreement of facts by trial counsel is totally inconsequential.
In concluding "there was not a sufficient evidentiary basis to support a finding that these trailers were sealed," (page 107) the majority pointedly ignore Mr. Roeder's testimony:
Q. Do you ever break the seals on those trailers?
A. Once in a while we do break the seals.
Q. For what purpose would you break the seals?
A. [A description of the circumstances.]
Q. Do you inspect all the loads that come into Philadelphia?
A. No, we don't.
Q. Where would that notation be if the seal were broken?
A. We would make a notation on the waybill, and we would also make a notation in our seal record book.
Q. If you know, were the seals broken in any of these four cases ?
A. Not to my knowledge.
(Record at 132-133.) (Emphasis supplied.)
The irrefutable and controlling fact is, as the majority explicitly conceded in their original opinion, that no evidence was introduced at trial to offset the critical evidence that the trailers were shipped under Rule 2 1/4, and Mr. Roeder's testimony that the trailers shipped under Rule 2 1/4 were sealed.
Accordingly, I would affirm the judgment of the district court.