Opinion
No. C8-97-157.
Filed August 26, 1997.
Appeal from the District Court, Hennepin County, File No. 934148.
Andrew R. Clark, Michael C. Glover, Amanda Cramer DuPont, (for Appellant)
Frank R. Berman, Sandra K. Kensy, James H. Gilbert, (for Respondent)
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1996).
UNPUBLISHED OPINION
Appellant seeks review of the dismissal of its case with prejudice. Because we conclude there was no abuse of discretion, we affirm.
FACTS
Appellant GT Trucking hauled goods for respondent, GFI America, Inc., a/k/a Goldberger Foods, from 1986 until the time of this litigation. Shipping arrangements were handled by Shippers Transportation Services (STS). STS billed respondent for appellant's rate plus a commission; upon receipt, STS deducted its commission and forwarded the balance to appellant. When STS went into bankruptcy in 1992, it had collected 45 freight bills from respondent from which it failed to forward payment to appellant. Unable to collect from STS, appellant sued respondent.
In 1993, during the course of litigation, respondent made numerous requests for evidence of appellant's tariff rate. Appellant refused, claiming that it was suing only for the rate it negotiated with STS. Respondent unsuccessfully moved for a directed verdict on appellant's failure to prove a valid tariff.
In a special verdict, the jury found respondent liable for the unpaid freight bills and ordered it to pay appellant damages. Respondent subsequently appealed both the jury finding of liability and the district court's denial of its motion for directed verdict.
In GT Trucking v. GFI America, Inc , 535 N.W.2d 658 (Minn.App. 1995) ( GT I ), this court affirmed the jury determination that respondent was liable for the unpaid freight bills; it reversed the district court's denial of respondent's motion for a directed verdict, however, holding that under the "filed rate doctrine," the tariff rate was the only rate that appellant could charge and proof of this tariff rate was essential to appellant's case.
The "filed rate doctrine" is based on 49 U.S.C. § 10762, which requires common carriers to file their shipping rates with the ICC and 49 U.S.C. § 10761, which prohibits deviating from those filed rates. The Supreme Court, in explaining the policy behind this doctrine, stated:
The legal rights of shipper as against carrier in respect to a rate are measured by the published tariff. Unless and until suspended or set aside, this rate is made, for all purposes, the legal rate, as between carrier and shipper. The rights as defined by the tariff cannot be varied or enlarged by either contract or tort of the carrier * * *. This stringent rule prevails, because otherwise the paramount purpose of Congress — prevention of unjust discrimination — might be defeated.
Maislin Indus. v. Primary Steel, Inc. , 497 U.S. 116, 126, 110 S.Ct. 2759, 2765-66 (1990) (quoting Keogh v. Chicago Northwestern Ry. Co. , 260 U.S. 156, 163, 43 S.Ct. 47, 49 (1922)).
On remand, the district court was given a broad mandate:
[I]f GT can present evidence of its tariff rate and make the appropriate motions, the trial court must determine whether to allow GT to reopen its damage claim or dismiss the case with prejudice. At the stage of these proceedings reached through the time of the remand, the trial court may believe that vacation of GT's judgment and dismissal of its claim with prejudice is the only fair remedy to deal with its failure to prove filed tariff rates. Alternatively, the court may believe it is fair to simply permit GT to * * * prove its tariff rate [and] * * * amend the damage award and judgment accordingly.
GT I , 535 N.W.2d at 662.
The district court subsequently permitted appellant to reopen the record and present evidence in order to prove the existence of its tariff, known as Tariff ICC GNTK 201 (Tariff 201). After considering expert testimony presented by both parties, the district court found that although Tariff 201 was properly filed with the Interstate Commerce Commission (ICC), the tariff contained a misreference; Tariff 201 failed to refer appropriately to the mileage guide required by 49 C.F.R. § 1312.30 (1995). (Instead of referring to the HGB 100-D mileage guide, Tariff 201 referenced HGB 101-A, a carrier list.) As a result of this misreference, the district court found Tariff 201 incomplete and invalid and dismissed appellant's case with prejudice.
Now known as the Surface Transportation Board.
DECISION
1. Jurisdiction.
Appellant contends that this court must defer to the ICC for a determination of the validity of Tariff 201 because that agency has primary jurisdiction over tariff interpretation. We disagree with appellant's position on this issue.
Respondent asserts that appellant waived its right to assert primary jurisdiction when it failed to raise the issue in the district court. However:
[I]t is well established that the doctrine of primary jurisdiction is not waived by the failure of the parties to present it in the trial court or on appeal.
Atlantis Express, Inc. v. Standard Transp. Serv., Inc. , 955 F.2d 529, 532 (8th Cir. 1992). We agree with the eighth circuit.
Whether an agency has jurisdiction over a matter is a legal question and thus a reviewing court need not defer to the trial court's decision on the issue. Frost-Benco Elec. Ass'n v. Minnesota Pub. Utils. Comm'n , 358 N.W.2d 639, 642 (Minn. 1984).
Any question concerning construction of a tariff is a question of law ultimately reviewable by the courts. Great N. Ry. Co., et al. v. Merchants' Elevator Co. , 259 U.S. 285, 290, 42 S.Ct. 477, 479 (1922). However, where any rate, rule, or practice is attacked as unreasonable or unjustly discriminatory, or where the question is highly technical, then a question of fact exists which is properly heard by the ICC. Id. at 291, 42 S.Ct. at 479; see, e.g., United States v. Western Pac. R.R. Co. , 352 U.S. 59, 68, 77 S.Ct. 161, 167 (1956) (holding that fixing the limits of a technical tariff without a better understanding of the factors that go into the rate-making process would be tantamount to judicial guesswork).
The question we must answer regarding Tariff 201 does not involve reasonableness or unjust discrimination, nor does it require substantial technical expertise; the only issue is statutory interpretation. The validity of Tariff 201 hinges on whether it meets the statutory requirements established by 49 C.F.R. § 1312.30 (1995).
Whether Tariff 201 is valid under 49 C.F.R. § 1312.30 is a question of tariff construction; questions of tariff construction are clearly within the discretion of this court. Merchants' Elevator Co. , 259 U.S. at 290, 42 S.Ct. at 479. We conclude that the district court had, and this court has, jurisdiction.
2. Tariff 201.
Tariff 201 raises two distinct questions for review:
(1) Is Tariff 201 valid?
(2) If the tariff is valid, did the district court act within the mandate of this court's decision in GT I when it dismissed this case with prejudice?
Validity
Experts for respondent and appellant differed greatly in their interpretation of the misreference in Tariff 201. Respondent's expert testified that the misreference made it impossible to discern which mileage guide applied; appellant's expert contended that anyone with experience in the shipping field could interpret the applicable mileage guide.
Respondent cites two recent cases that invalidated tariffs and argues that the decisions in these cases support the trial court's invalidation of the tariff here. In Security Serv., Inc. v. Kmart Corp. , 511 U.S. 431, 114 S.Ct. 1702 (1994), the court held a tariff invalid because the carrier failed to pay annual dues necessary for participation in a carrier list. In Atlantis Express, Inc. v. Associated Wholesale Grocers, Inc. , 989 F.2d 281 (8th Cir. 1993), the court held a tariff invalid because the carrier failed to provide power of attorney as required. Both Security Serv. and Atlantis are distinguishable and provide no support for respondent's argument that Tariff 201 was invalid. Both Security Serv. and Atlantis involve failure to file a tariff rate properly, a clear violation of 49 C.F.R. § 1312.30. In this case, the trial court specifically found that appellant properly filed the tariff; the only issue is appellant's failure to reference the appropriate mileage guide in Tariff 201.
We believe the district court erred in concluding that the misreference in Tariff 201 rendered the tariff invalid. A review of case law indicates that the misreference actually rendered the tariff only ambiguous. See National Van Lines v. United States , 355 F.2d 326, 332 (7th Cir. 1966) (inadvertent omission in a chart does not change the meaning of the tariff; it is ambiguous, not void).
We reject appellant's contention that even if the district court failed to find a valid tariff rate, it should have used the negotiated rate initially applied by the jury. Appellant's reliance on a line of undercharge cases in which bankrupt carriers sued shippers to collect the difference between the negotiated rate and the tariff rate is misplaced. See, e.g., Security Serv.; Atlantis Express . In each of these cases, the negotiated rate had already been paid and the carrier was attempting, after the fact, to collect the difference between it and the tariff rate. Presumably (though no court holds specifically), the carrier was not expected to refund the negotiated rate when the court refused to apply the tariff rate. Security Serv., 511 U.S. at 451, 114 S.Ct. at 1714 (Thomas, J. dissenting).
Appellant's argument that this court should apply the negotiated rate is further weakened by GT I :
The shipper and the carrier cannot legally negotiate a rate different from the tariff rate. * * * When a common carrier sues to collect unpaid shipping charges, the carrier must sue to collect the rate contained in its tariff, notwithstanding the fact that it may have negotiated a different rate with the shipper * * *. [I]t would be inappropriate under any circumstances for a court to enforce an agreement that is illegal under federal law.
Id. at 660-61 (citations omitted).
The filed tariff rate is the only rate that can legally be collected. Without such a rate, the parties are left to suffer the consequences of negotiating in violation of federal law.
Trial court discretion
Our conclusion that the tariff is ambiguous, not void, cannot end our inquiry, however.
Although the district court could have resolved the ambiguity in Tariff 201 and given effect to the jury award, was it required to do so pursuant to the instructions of GT I ? We think not. The decision from an earlier appeal becomes the law of the case in subsequent appeals. Chippewa County Bank v. Kief , 179 Minn. 284, 288, 229 N.W. 130, 132 (1930). This court's GT I remand, we believe, granted broad discretion to the district court: if appellant could introduce evidence of its tariff rate, the court could either modify the jury award to correspond to the tariff rate or dismiss the case with prejudice. When appellant's evidence failed to demonstrate clearly to the court an applicable tariff rate, dismissal of the case with prejudice was one of the options available. Given the broad mandate of GT I , we do not find reversible error in the decision of the district court on remand.
Given our resolution of the other issues, we do not address respondent's argument that the district court erred in reopening the record for receipt of additional evidence.