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Mexican Light & Power Co. v. Texas Mexican Railway Co.
Citations: 67 S. Ct. 1440; 331 U.S. 731; 91 L. Ed. 1779; 1947 U.S. LEXIS 2896Docket: 404
Court: Supreme Court of the United States; June 16, 1947; Federal Supreme Court; Federal Appellate Court
Justice Frankfurter delivered the Court's opinion in a case concerning damages for goods damaged during an export shipment via rail. The Westinghouse Electric and Manufacturing Company consigned goods to the Pennsylvania Railroad in Sharon, Pennsylvania, for delivery to the Mexican Light and Power Company in Laredo, Texas, with the final destination noted as El Oro, Estado de Mexico. The goods were transported under a bill of lading that indicated prepaid export charges covering the shipment to the international boundary. The Texas-Mexican Railway was responsible for moving the goods from Alice, Texas, to Laredo, where a second bill of lading was issued to Fausto Trevino, the customs agent. Although Trevino used this second bill for customs clearance, there was no evidence that the original bill would have been insufficient for this purpose. The Texas-Mexican Railway received no additional payment beyond its share of the prepaid export rate from the Pennsylvania Railroad. The goods were moved to the international boundary where they were transferred to the National Railways of Mexico, where the damage occurred. The initial judgment favored the railroad, but the Texas Court of Civil Appeals reversed it, a decision later overturned by the Texas Supreme Court. The U.S. Supreme Court granted certiorari due to significant issues regarding carrier liability under the Interstate Commerce Act. The Court concluded that the goods were transported under the original bill of lading issued in Sharon, which governed their rights. According to the Carmack Amendment, only the initial carrier is liable for damage occurring during the connections, and the Texas-Mexican Railway could not be deemed an initial carrier for the Mexican Railroad without a new shipment initiation. The Court agreed with the Texas Supreme Court that the duty established at Sharon remained unchanged and that the second bill of lading did not alter the original terms, rendering it without consideration and void. A bill of lading issued by a connecting carrier for a through shipment is rendered void under the Carmack Amendment unless the connecting carrier has received additional consideration beyond that of the initial bill of lading. This provision ensures that the liability of the connecting carrier cannot be expanded nor can it limit the liability of the initiating carrier. The principle, as clarified in the Ward case, emphasizes that the initial carrier retains unified responsibility for transportation to the destination. In Ward, the court determined that a second bill of lading lacked valid consideration, despite claims of a special reduced rate, because it did not alter the original agreed-through rate. The Texas Supreme Court correctly ruled that the shipment remained under the original bill of lading, affirming that the initial carrier's responsibility was not displaced and that the connecting carrier was not liable for damages incurred on the Mexican Railroad.