Southern Railway Co. v. Prescott

Background

A shoe consignee, W. E. Prescott, received thirteen boxes shipped interstate; four boxes were picked up and nine boxes remained at the railroad’s depot. Those nine boxes were destroyed by a warehouse fire while held by a railroad company. The consignee sued the railroad first as a carrier, then withdrew that claim and pursued only a claim that the railroad was liable as a warehouseman under state law. A jury and the state supreme court found for the consignee.

Reasoning

The Court considered whether payment of freight and a receipt ended the federal contract so state warehouse rules could apply. It held the service of holding goods after arrival is part of “transportation” under the federal shipping law and that the carrier’s filed bill of lading and published rules controlled. The parties could not by private agreement replace the filed terms. Under the bill of lading the railroad’s liability while holding undelivered goods was that of a warehouseman governed by federal rules, meaning the plaintiff had to prove negligence. Because the loss was from a mysterious fire with no evidence of careless conduct, the Court concluded the state-court instructions and judgment were wrong.

Real world impact

The decision makes filed federal shipping rules — not separate local bargains or state law — the guide for a carrier’s storage responsibility for interstate shipments. It requires those suing for loss while goods remain undelivered to prove carrier negligence rather than relying on exceptional state presumptions.