Western Union Telegraph Co. v. Jacobs, 280 S.W. 733 (Tex. Ct. App. 1926)

Statement of the Case.

NICKELS, J.

Jacobs filed with the telegraph company at Navasota, Tex., an unrepeated collect telegram to be- delivered to Atkinson &• Co. at New Orleans, La., and reading as follows: “Buy one Jan.” As delivered at New Orleans, the message read: “Sell one Jan.” The message related to a cotton transaction, and the change in the wording of the telegram caused an actual loss to Jacobs of $144. For this loss, as damages, he sued.

The telegraph company answered generally, and specially pleaded certain of the stipulations printed on the telegram form used, which, according to the face of the form, were made a part of the contract. Those stipulations read as follows:

Prior to the time in question, and with the approval of the Interstate Commerce Commission, the company had prepared and filed tariffs and classifications fixing one basis of rates for unrepeated messages and a higher basis for repeated ones, and, also, one basis of rates for nonspecially valued messages and a higher basis for specially valued ones. The telegram in question was an.unrepeated and a nonspecially valued one, and the rate charged (and collected from the addressees at New Orleans) was 70 cents.

The trial court rendered judgment for Jacobs in the sum of $50. On appeal the Court of Civil Appeals reversed that judgment, and rendered judgment for the telegraph company; holding that the $50 valuation clause did not apply, and that, since Jacobs did not pay for the message, he could not recover its cost. 245 S. W. 942. That court overruled a motion to certify for conflict betw'een its decision and that of the Court of Civil Appeals in Telegraph Co. v. McDavid, 219 S. W. 853. Upon application to the Supreme Court, mandamus issued, on recommendation of the Commission of Appeals, Section B, requiring certification. Jacobs v. Pleasants, 267 S. W. 251. In response, the Court of Civil Appeals has certified the following question:

In explanation of its prior refusal to certify, the Court of Civil Appeals states that it realized the fact of conflict between its decision and that in Telegraph Company v. McDavid, but that it regarded the decisions of the Supreme Court of the United States in Postal Telegraph Co. v. Warren-Godwin Lumber Co., 251 U. S. 27, 40 S. Ct. 69, 64 L. Ed. 118, and in Western Union Telegraph Co. v. Esteve Bros., 41 S. Ct. 584, 256 U. S. 566, 65 L. Ed. 1094, as being controlling and conclusive upon all other courts, and, hence, it did not believe it proper or necessary to certify as to- “the conflict between the Supreme Court of the United States -and the Court of Civil Appeals for the Second Supreme Judicial District of Texas.”

[1, 21 The transaction was interstate. Congress, and its agency, the Interstate Commerce Commission, with the help of the telegraph company as “primary” rate maker, had, under and pursuant to the act of 1910 (36 Stat. L. 539), established regulations which required the telegram in question to be sent on the conditions named on the form used. Those terms, during the period of nonaction by Congress and its agency, were invalid and unenforceable according to the state law. Western Union Telegraph Co. v. Bailey, 196 S. W. 516, 108 Tex. 427; Adams Ex. Co. v. Croninger, 33 S. Ct. 148, 226 U. S. 491, 500, 57 L. Ed. 314, 44 L. R. A. (N. S.) 257; Minnesota Rate Cases, 33 S. Ct. 729, 230 U. S. 352, 409, 433, 57 L. Ed. 1511, 48 L. R. A. (N. S.) 1151, Ann. Cas. 1916A, 18; Western Union Tel. Co. v. James, 16 S. Ct. 934, 162 U. S. 650, 40 L. Ed. 1105; New York, N. H. & H. Ry. Co. v. New York, 17 S. Ct. 418, 165 U. S. 628, 41 L. Ed. 853; M., K. & T. Ry. Co. v. Harris, 34 S. Ct. 790, 234 U. S. 419, 58 L. Ed. 1377, L. R. A. 1915E, 942. But “it is of the essence” of the federal power to regulate interstate commerce “that, where it exists, it dominates” (H. E. & W. T. Ry. Co. v. U. S., 34 S. Ct. 833, 234 U. S. 342, 58 L. Ed. 1341), and, when exerted, as here, it supersedes “all the regulations and policies of a particular state upon the same subject.” Adams Ex. Co. v. Croninger, supra; Postal Tel. Co. v. Warren-Godwin Lbr. Co., 251 U. S. 27, 40 S. Ct. 69, 64 L. Ed. 118; Western Union Tel. Co. v. Esteve Bros., 41 S. Ct. 584, 256 U. S. 566, 65 L. Ed. 1094; Western Union Tel. Co. v. Southwick, 41 S. Ct. 446, 255 U. S. 565, 65 L. Ed. 788 (reversing judgment of the Court of Civil Appeals reported in 214 S. W. 9S7; Western Union Tel. Co. v. Czizek, 44 S. Ct. 328, 264 U. S. 281, 68 L. Ed. 682). The cases cited must be regarded as being final on the question of the inapplicability of contrary state policy in respect to transactions such as here involved, and, consequently, of the validity of the stipulations as controlling interstate messages.

The interpretation of the stipulations, then, is the only present concern. And in that aspect we regard the case as being ruled by Western Union Tel. Co. v. Czizek, supra. An agent of Czizek filed with the telegraph company, at its office in Boise, Idaho, an unrepeated nonspecially valued telegram for transmission and delivery to Czizek at Oakland, Cal. The clerk who received the message at Boise, through inadvertence, etc., placed it in a file of previously handled telegrams, with the result that it was not transmitted at all. On the next day inquiry about the contemplated reply was made at Boise, and Czizek’s agent was told that the telegram had been sent, but that no answer had come. Three days later another inquiry was made at the Boise office, and Czizek’s agent was told that he (Czizek) had received the message. Suit was brought to recover actual damages for resulting injury, and the telegraph company pleaded limitations of liability provided for in stipulations in all respects like those on the form used by Jacobs. The Circuit Court of Appeals “distinguished between a failure to take the first step toward transmission and some later neglect,” and “held that the failure was not, and, as a matter of public policy, could not be, within the protection” of the stipulations. The distinction was not favored by the Supreme Court, and in respect to the matter that court said:

[3] And it was held that the company’s liability was restricted to $50 by the second clause; the first clause being too narrow to relieve the company above the charges exacted. Both clauses, as will be noted, in terms apply to “mistakes or delays in the transmission or delivery or for nondelivery” ; the second adding immediately, “whether caused by the negligence of its servants or otherwise.” In the Czizek Case it was held that “the transit begins” when the message is given to the “receiving clerk” at the sending office. If so, whatever then happens pertains as much to “transmission” as to “receipt,” “delivery” or “nondelivery,” and we perceive, no ground upon which to rest a distinction between a “mistake,” “neglect,” or “inadvertence” which produces a failure to forward and one which causes a change of a word intervening moments of “receipt” and “delivery.” Since one or the other of the stipulations here presented must be enforced, and since application of the second to the exclusion of the first approaches as nearly as possible to harmony with that general policy of the state announced in Western Union Tel. Co. v. Bailey, supra, and upon the authority of Western Union Tel. Co. v. Czizek, supra, we hold that the stipulations pleaded are obligatory upon Jacobs, but that he is entitled to recover his damages within the $50 valuation. Accordingly, the quest tion certified should be answered “yes.”

OURBTON, C. J.

The opinion of the Commission of Appeals answering certified questions is adopted, and ordered certified to the Court of Civil Appeals.