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UNIVERSAL COMPUTER SYS. v. ALLEGHENY AIRLINES

August 29, 1979

UNIVERSAL COMPUTER SYSTEMS, INC., Plaintiff,
v.
ALLEGHENY AIRLINES, INC., Defendant



The opinion of the court was delivered by: HERMAN

MEMORANDUM

This case was consolidated for trial with Universal Computer Systems, Inc., v. Medical Services Association of Pennsylvania t/a Pennsylvania Blue Shield, 474 F.Supp. 472 (M.D.Pa.) Civil No. 77-868. On November 9, 1978, a jury rendered a verdict in the amount of $ 13,000 against Allegheny Airlines, Inc. and a verdict in like amount against Medical Services Association of Pennsylvania, trading as Pennsylvania Blue Shield. The Defendant in this action, Allegheny Airlines, Inc. filed motions for judgment notwithstanding the verdict, for a new trial, and to alter or amend the judgment. Subsequently Defendant Allegheny Airlines, Inc. filed a supplemental motion for judgment notwithstanding the verdict. These motions are now before the Court.

 There are significant substantive prerequisites to the consideration of a motion for judgment notwithstanding the verdict pursuant to Rule 50(b) of the Federal Rules of Civil Procedure. A party must make a motion for a directed verdict and a party may not base a motion for judgment notwithstanding the verdict on a ground not advanced in his motion for a directed verdict. Wall v. United States, 592 F.2d 154 (3d Cir. 1979). In reviewing the motion for judgment notwithstanding the verdict the Court must view the evidence most favorably to the party against whom the motion is made. Denneny v. Siegel, 407 F.2d 433 (3d Cir. 1969). We must determine whether as a matter of law the record is critically deficient of that minimum quantum of evidence from which a jury might afford relief. Vizzini v. Ford Motor Co., 569 F.2d 754, 760 (3d Cir. 1977). There exists a different standard for determining a motion for a new trial pursuant to Rule 59 of the Federal Rules of Civil Procedure. A motion for a new trial may be granted on the ground that the verdict is against the clear weight of the evidence or when necessary to prevent a miscarriage of justice. Wright & Miller, Federal Practice and Procedure: Civil § 2505.

 We will briefly recite the facts of this case construed in the light most favorable to the Plaintiff. In July of 1975, Blue Shield solicited bids for the lease of a computer. Pursuant to the bid solicitation, Plaintiff prepared a proposal, which was required by the solicitation to be received by Blue Shield no later than 12:00 noon on August 18, 1975. Plaintiff, through its President, Warren Wilson, contacted Joel Gebert, an employee of Blue Shield, and obtained Gebert's assurance that he would have the bid proposal picked up at the Allegheny Airlines ticket counter in Harrisburg on the morning of August 18, 1975 in time for the Blue Shield 12:00 noon deadline in Camp Hill. Pursuant to the Gebert promise, Plaintiff dispatched his bid proposal by Allegheny Airlines PDQ Service on August 18, 1975, at approximately 8:30 a. m. Wilson called Gebert again to give him the waybill number so that the proposal could be picked up per the agreement. Wilson was informed by Gebert that Gebert had changed his mind regarding his promise to pick up the bid proposal and would not do so. The package arrived at Harrisburg International Airport at approximately 9:30 a. m., August 18, 1975, after having been registered on the plane on the PDQ service for shipment at approximately 8:30 a. m. for Harrisburg. Wilson's son hand delivered the package to LaGuardia and received as a receipt a "small package air bill" with number 2651434. The air bill indicates flight 843, destination "MDT", referring to the Harrisburg International Airport at Middletown, Pennsylvania.

 Upon learning of the Blue Cross refusal to pick up the bid proposal, Wilson obtained the number of the Allegheny manager in Harrisburg, a William N. Hanson. Hanson told Wilson that he would not release the proposal to anyone but Wilson or a direct employee of his or Ray Eichelberger of Blue Shield or possibly a direct employee of Blue Shield. Wilson attempted to convince Hanson that he was who he said he was in an attempt to convince Hanson to release the package to a courier. Wilson expressed to Hanson the gravity of the situation and the 12:00 noon deadline and explained that Blue Shield refused to pick up the bid because they considered it showing bias toward a bidder, and that he, Wilson, was the only employee of Universal. After Hanson refused to release the item to a courier, Wilson and another person in his office attempted to go over Hanson's head to get permission to release the item. The other person in Wilson's office obtained the name of one of the officers of Allegheny and as a result of a call to him and the officer's call to Hanson, Hanson released the proposal to a policeman at the airport who actually delivered the proposal. The proposal arrived after 12:00 noon and was rejected as a late bid by Defendant Blue Shield and returned unopened.

 The motion for judgment notwithstanding the verdict raises a number of grounds. The Defendant claims that the applicable tariff provision provides that all claims must be made in writing within a period of nine months and nine days after acceptance of the shipment. The Defendant asserts that the applicable tariff provides that the Defendant shall not be liable for consequential or special damages whether or not the carrier had knowledge that such damages might be incurred, and that the applicable tariff provides that the Defendant shall not be liable for damage caused by the act or default of the consignor (Plaintiff) or the consignee (Medical Services Association of Pennsylvania, trading as Pennsylvania Blue Shield). The motion further asserts that the evidence will not support a finding that Allegheny Airlines, Inc. was negligent or that any negligence or conduct on its part was a proximate cause of any injury or damages to the Plaintiff. In relation to these assertions the Defendant asserts that Plaintiff failed to establish that it in fact would have been awarded a contract for the 155 computer rental, that said computer was available to enable it to comply with a contract had a contract been awarded, or that the computer would have complied with the technical specifications and performance specifications set forth in the invitation for proposals. It is further asserted that Plaintiff failed to establish that if its bid proposal had been recommended by Pennsylvania Blue Shield that it would have been approved by the Federal Bureau of Health Insurance, or that if Plaintiff had received the initial award the final terms of the contract would have been approved by Pennsylvania Blue Shield.

 The motion for a new trial asserts that the verdict was contrary to the law and evidence, against the weight of the evidence, excessive, ambiguous and inconsistent.

 If the restrictions which are contained in Defendant's tariff are applicable and enforceable then the Defendant would be entitled to a judgment notwithstanding the verdict. This action by the Plaintiff involves a claim for damages against an interstate air carrier. The transportation by air of property in interstate commerce is subject to federal law, specifically the Federal Aviation Act of 1958, 49 U.S.C. § 1301 et seq. An air carrier is required by 49 U.S.C. § 1373(a) to file its tariff with the Civil Aeronautics Board. It is standard operating procedure for the carriers to insert various self-serving disclaimers for liability in the tariffs which are filed, provisions which the customer becomes all too aware of after a claim arises.

 The provisions at issue are contained in Allegheny's Airfreight Rules Tariff No. 1-B (Defendant Allegheny's Exhibit No. 1), Allegheny's Official Air Freight Small Package Tariff No. SPR-1, and Allegheny's Small Package Airbill. Rule 60(B)(1) of Airfreight Rules Tariff No. 1-B provides:

 
"(1) All claims, except for overcharges, must be made in writing to the originating or delivering carrier within a period of nine months and nine days after the date of acceptance of the shipment by the originating carrier. Claims for overcharges must be made in writing to the originating or delivering carrier within two years after the date of acceptance of the shipment by the originating carrier. In computing the time periods under this paragraph, the first day of the period shall be the day after acceptance of the shipment by the originating carrier."

 Rule 30(B)(1) of the same rules provided:

 
"(d) The carrier shall not be liable for any consequential or special damages whether or not the carrier had knowledge that such damages might be incurred."

 Rule 45(B) of Allegheny's Official Air Freight Small Package Tariff No. SPR-1 provides as follows:

 
"A shipment shall have a declared value of $ 50.00 unless a higher value (not to exceed $ 500.00) is declared on the airbill at the time of receipt of the shipment from the shipper. Shipments with a declared value in excess of $ 500.00 are not acceptable for transportation under this tariff."

 On the back of Allegheny's Small Package Airbill are five printed paragraphs containing terms and conditions of the airbill. Paragraphs two and three provide as follows:

 
"2. It is mutually agreed that the shipment described herein is accepted on the validation date hereof in apparent good order (except as noted) for carriage as specified herein, subject to governing classifications and tariffs in effect as of the date hereof which are filed in accordance with law. Said classifications and tariffs are available for ...

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