National Hispanic Circus, Inc. v. Rex Trucking, Inc.

United States Court of Appeals
Fifth Circuit
F I L E D
REVISED JULY 8, 2005
June 23, 2005
IN THE UNITED STATES COURT OF APPEALS
Charles R. Fulbruge III
FOR THE FIFTH CIRCUIT Clerk

No. 04-41217

THE NATIONAL HISPANIC CIRCUS, INC.,
A New York not-for-profit Corporation,

Plaintiff - Counter Defendant - Appellee

versus

REX TRUCKING INC, ETC; ET AL

Defendants

MASON & DIXON LINES, INC.

Defendant - Counter Claimant - Appellant

Appeal from the United States District Court
for the Southern District of Texas

Before WIENER, DeMOSS, AND PRADO, Circuit Judges.

WIENER, Circuit Judge:

Defendant - Counter Claimant - Appellant Mason & Dixon Lines,

Inc. (“Mason”) challenges a jury verdict and damages awarded in

favor of Plaintiff-Counter Defendant-Appellee the National Hispanic

Circus (the “Circus”). We affirm.

This dispute arises out of a missing set of circus bleachers,

lost somewhere between Texas and Chicago while in the care of

Mason. The Circus regularly employed Mason’s trucks and drivers to

transport its equipment from one show to the next. On this
occasion, however, one of seven trailers —— the one carrying half

of the Circus's bleachers —— never made it to the Chicago show.

Consequently, the Circus was forced to rent replacement bleachers

which provided approximately 600-700 fewer seats than its own

bleachers. Several weeks later, the Circus ordered replacement

bleachers, which had to be custom-made in Italy to fit its tent.

The cost of the replacement bleachers was $87,500.00, which the

Circus was forced to pay in advance. The shipping cost was

$36,104.00. (Approximately three months after its disappearance,

the Circus’s trailer containing its original bleachers was

discovered in Arkansas.)

The Circus brought suit under the Carmack Amendment to the

Interstate Commerce Act, 49 U.S.C. § 14706 et seq., against Mason

and Rex Trucking1 for damages it suffered as a result of the lost

trailer. Mason asserted a counterclaim for the balance of the

Circus’s freight charges for the trailers Mason did deliver timely

to Chicago.

At the completion of the trial, the jury awarded the Circus

damages of $9,000 for rental of replacement bleachers, $123,000 for

the purchase and shipping of the new bleachers, and $16,500 for

lost ticket sales. It awarded Mason $15,600 on its counter-claim

for payment for timely delivery of the six other trailers. Mason

1
Mason acquired Rex approximately two weeks prior to the
events at issue and agreed to answer for any damages the Circus
could establish against Rex. Rex was therefore dismissed from
this suit.

2
then renewed an earlier motion for judgment as a matter of law and

moved alternatively for a new trial. The district court struck the

award for lost ticket sales as too speculative and offset the rest

of the Circus’s award by the amount of Mason’s award, thus granting

total damages to the Circus of $116,400, including pre- and post-

judgment interest, but upheld all other aspects of the jury’s

verdict and its own rulings. Mason appeals the district court’s

denial of its motions for judgment as a matter of law and for a new

trial, as well as one of the district court’s evidentiary rulings

and its calculation of damages.

1. General v. Special Damages

We review de novo a district court’s denial of a Federal Rule

of Civil Procedure 50 motion for judgment as a matter of law.2

Under this standard, judgment as a matter of law “is appropriate

only where there is no legally sufficient basis for a reasonable

jury to find for [a] party.”3 Although our review is de novo, we

accord great deference to a jury verdict, evaluating the evidence

in the light most favorable to the non-movant and reversing only if

“the evidence at trial points so strongly and overwhelmingly in the

movant’s favor that reasonable jurors could not reach a contrary

2
Arguello v. Conoco, Inc., 330 F.3d 355, 357 (5th Cir.
2003).
3
Id.

3
conclusion.”4

The Carmack Amendment allows a shipper to recover damages from

a carrier for “actual loss or injury to the property” resulting

from the transportation of cargo in interstate commerce.5 A

carrier’s liability under the Carmack Amendment includes all

reasonably foreseeable damages resulting from the breach of its

contract of carriage, “including those resulting from nondelivery

of the shipped goods as provided by the bill of lading.”6

Both general and special damages may be recovered under the

Carmack Amendment.7 General damages are those that are foreseeable

at the time of contracting.8 Special damages are those that result

from a party’s breach of contract but are not reasonably

foreseeable. Special damages generally are not recoverable in a

breach of contract action absent actual notice to the defendant of

special circumstances from which such damages might arise.9

Mason argues that the district court erred by submitting the

4
Omnitech Int’l, Inc. v. Clorox Co., 11 F.3d 1316, 1323
(5th Cir. 1994).
5
49 U.S.C. § 14706(a)(1).
6
Air Prods. & Chems., Inc. v. Ill. Cent. Gulf R.R. Co., 721
F.2d 483, 485 (5th Cir. 1983).
7
Paper Magic Group, Inc. v. J.B. Hunt Transp., Inc., 318
F.3d 458, 461-62 (3d Cir. 2003).
8
Hector Martinez & Co. v. S. Pac. Transp. Co., 606 F.2d
106, 109 (5th Cir. 1979).
9
Tex. A&M Research Found. v. Magna Transp., Inc., 338 F.3d
394, 404 (5th Cir. 2003).

4
foreseeability of the Circus’s damages to the jury rather than

deciding as a matter of law that the Circus’s damages were special

rather than general. But, “[t]he question whether or not the

defendant did in fact foresee, or had reason to foresee, the injury

that the plaintiff has suffered is a question of fact for the

jury.”10

The jury heard evidence that Mason (actually Rex) had

previously shipped the Circus’s equipment, that Mason employees

filled out the bills of lading without listing the trailer’s

contents, and that Mason knew that it was shipping a “wide variety”

of the Circus’s equipment. This evidence was sufficient to support

the jury’s finding that Mason should have foreseen the injury to

the Circus.11

2. Jury Instructions; Denial of New Trial

As Mason objected to the district court’s jury instructions at

10
11-56 Corbin on Contracts § 1012 (2005). “The
foreseeability of damages is a fact question we review for clear
error,” Texas A&M, 338 F.3d at 405, and “[t]he amount of damages
that was reasonably foreseeable involves a fact question that
[the plaintiff] is entitled to present to a jury.” Martinez, 606
F.2d at 110.
11
See Air Prods., 721 F.2d at 487 (upholding district
court’s factual finding that plaintiff’s damages were foreseeable
because defendant’s employees knew that plaintiff immediately
unloaded deliveries of chemicals into a storage tank, that they
should have reasonably anticipated that delivery of the wrong
chemical would result in contamination of entire contents of the
storage tank, and that it would cost money to clean up the mess).

5
trial, our review is for abuse of discretion.12 A district court

does not abuse its discretion if its instructions, as a whole,

state the law correctly and instruct the jury properly on the legal

principles to be applied to the facts that they will decide.13

Mason also appeals the district court’s denial of its motion for a

new trial based on what it terms inconsistent answers to the jury’s

interrogatories, a decision we review for abuse of discretion.14

Mason asserts that the district court improperly refused to

craft an interrogatory that requested the jury to determine whether

the damages being sought by the Circus were foreseeable in the

absence of actual notice. Instead, the district court separated

the inquiry into two interrogatories, asking the jury, first, to

determine whether the listed injuries were reasonably foreseeable

to Mason at the time of contracting. The jury was instructed that,

if it answered in the negative, it should then determine whether

Mason had actual notice of circumstances that could give rise to

the Circus’s injuries. Posing this inquiry as two separate

questions neither mis-stated the law nor made it impossible to tell

whether the jury awarded general or special damages.

Mason goes on to argue that the jury’s verdict was

12
United States v. Daniels, 281 F.3d 168, 183 (5th Cir.
2002).
13
United States v. Dien Duc Huynh, 246 F.3d 734, 738 (5th
Cir. 2001).
14
Knight v. Texaco, 786 F.2d 1296, 1299 (5th Cir. 1986).

6
inconsistent. Rather than awarding money damages after determining

that the Circus’s damages were reasonably foreseeable, the jury

instead determined that Mason also had actual notice of the

Circus’s potential damages. Mason contends that this mistake

requires a new trial, as the Circus presented no evidence showing

that Mason had actual notice of the possibility of special damages;

thus, it asserts, the jury’s verdict may have rested on a theory

that lacked adequate support in the record.15

Even if the jury’s answers were inconsistent, —— a highly

implausible contention ——16 a new trial still was not required if

the verdict can be explained by assuming that the jury

misunderstood the question.17 If the jury’s answer to a question

that was supposed to pretermit further inquiry is clear and

disposes of the legal issues, we must ignore the jury’s conflicting

15
See Braun v. Flynt, 731 F.2d 1205, 1206 (5th Cir.
1984)(“When two claims have been submitted to the jury, whether
on a general verdict or, as here, in a single interrogatory, a
new trial may be required if one of the claims was submitted
erroneously.”)(quoting United N. Y. & N. J. Sandy Hook Pilot
Ass'n v. Halecki, 358 U.S. 613 (1959)).
16
A jury's answers “should be considered inconsistent. . .
only if there is no way to reconcile them.” Willard v. The John
Hayward, 577 F.2d 1009, 1011 (5th Cir. 1978). In this case, it
is conceivable that the jury found both that the damages at issue
were reasonably foreseeable and that Mason had actual notice of
the possibility of this kind of injury.
17
Smith v. Tidewater Marine Towing, 927 F.2d 838, 843 (5th
Cir. 1991)(citing Willard, 577 F.2d at 1011).

7
answers to any other questions, as they are irrelevant.18 As the

jury’s answer to the second question was superfluous to its finding

that Mason could reasonably have foreseen the damages to the

Circus, Mason is not entitled to a new trial or a judgment as a

matter of law.19

3. Exclusion of Witness’s Testimony Under Rule 701

We review a district court’s decision to exclude evidence for

abuse of discretion.20 If we find an abuse of discretion, we apply

the harmless error rule to determine whether the error affected the

substantial rights of the complaining party.21

Mason complains that a portion of the testimony of its

corporate claims manager, Ralph Castile, was improperly excluded.

Castile’s job is, in large part, to sell at salvage cargo that has

been refused by the consignee or damaged in transit. Castile was

permitted to describe the process by which he conducts those sales

and stated that he had been able to determine the market value of

the bleachers. The district court nevertheless excluded Castile’s

18
White v. Grinfas, 809 F.2d 1157, 1161 (5th Cir. 1987);
Carr v. Wal-Mart Stores, Inc., 312 F.3d 667, 674 (5th Cir. 2002).
19
As we may ignore the jury’s answer to the second
interrogatory, asking whether Mason had actual notice of the
Circus’s damages, we do not consider Mason’s argument that this
finding was not supported by the evidence.
20
Green v. Adm’rs of the Tulane Educ. Fund, 284 F.3d 642,
660 (5th Cir. 2002)
21
United States v. Asibor, 109 F.3d 1023, 1032 (5th Cir.
1997).

8
opinion testimony on the re-sale value of the bleachers.

Under Rule 701, “[a] lay opinion must be based on personal

perception, must be one that a normal person would form from those

perceptions, and must be helpful to the [fact finder].’”22 “In

particular, the witness must have personalized knowledge of the

facts underlying the opinion and the opinion must have a rational

connection to those facts.”23 Rule 701 does not exclude testimony

by corporate officers or business owners on matters that relate to

their business affairs, such as industry practices and pricing.24

Castile was allowed to testify on matters relating to his own

business experience, as permitted by Rule 701. The district court

properly excluded his testimony on matters, including the re-sale

value of used, custom-made bleachers, about which he had no first-

hand knowledge or experience. The district court’s ruling on

Castile’s testimony was an appropriate exercise of its discretion.

4. Calculation of Damages

We review legal conclusions underlying an award of damages de

22
Miss. Chem. Corp. v. Dresser-Rand Co., 287 F.3d 359, 373
(5th Cir. 2002) (quoting United States v. Riddle, 103 F.3d 423,
428 (5th Cir. 1997)).
23
Id. at 373-74 (allowing corporation's director of risk
management to testify to lost profits, and collecting cases from
other circuits holding likewise).
24
Tex. A&M Research Found. v. Magna Transp., Inc., 338
F.3d 394, 403 (5th Cir. 2003)(citation omitted).

9
novo.25 If the district court committed no legal error, we review

its factual findings for clear error.26

Mason insists that the district court erred in awarding the

Circus the cost of its new bleachers. As it did not actually lose

the bleachers but only misplaced them for several months, Mason

argues, it should be liable only for damages resulting from the

rental of temporary bleachers and any diminution in the bleachers’

value during the time that Mason possessed them.

The Carmack Amendment incorporates common law principles for

calculation of damages.27 “Ordinarily the measure of damages where

the carrier fails to deliver a shipment at destination within a

reasonable time is the difference between the market value of the

goods at the time of delivery and the time when they should have

been delivered.”28 This method, however, is not the exclusive means

by which damages may be measured in Carmack Amendment cases: It is

not applied when another method will more accurately reflect the

25
Id. at 404 (citing Harken Exploration Co. v. Sphere Drake
Ins. P.L.C., 261 F.3d 466, 477 (5th Cir. 2001)).
26
Id. (citing Tyler v. Union Oil Co., 304 F.3d 379, 401
(5th Cir. 2002)).
27
Hector Martinez & Co. v. S. Pac. Transp. Co., 606 F.2d
106, 108 (5th Cir. 1979).
28
Richard A. Lord, 24 Williston on Contracts § 64:12 (4th
ed. 2004). See also Oak Hall Cap & Gown Co. v. Old Dominion
Freight Line, Inc., 899 F.2d 291, 296 (4th Cir. 1990); Martinez,
606 F.2d at 110.

10
loss actually suffered by the plaintiff.29

Under particular circumstances, replacement cost can be a

legitimate measure of Carmack Amendment damages.30 Here, the

district court was required to determine the Circus’s actual loss,

using the most appropriate method.31 This case presents a

circumstance in which awarding “market value” diminution or rental

price of substitute equipment would not be appropriate, because the

award would not fairly compensate the plaintiff for its actual

loss.32

The Circus requires custom-made bleachers to fit its tent.

29
Project Hope v. M/V Ibn Sina, et al., 250 F.3d 67, 77 (2d
Cir. 2001)(admiralty case)(holding that district court did not
abuse its discretion when it ordered the defendant to pay
replacement cost of lost cargo, as that was the most accurate
measure of the plaintiff’s damages); Oak Hall, 899 F.2d at 296
(approving award of replacement cost of damaged academic robes,
as the plaintiff secured substitute goods after the accident,
lost no sales, and had no opportunity for sales with the damaged
goods); Martinez, 606 F.2d at 110-11.
30
See Am. Nat’l Fire Ins. Co. v. Yellow Freight Sys., 325
F.3d 924, 935 (7th Cir. 2003)(“The other measure commonly used is
the replacement cost of the damaged goods to the shipper --
particularly when the shipper has not lost a sale, but was able
to timely purchase replacements.”); Project Hope, 250 F.3d at 77;
Oak Hall, 899 F.2d at 296.
31
See Martinez, 606 F.2d at 110.
32
See Air Prods. & Chems., Inc. v. Ill. Cent. Gulf R.R.
Co., 721 F.2d 483, 485 (5th Cir. 1983)(holding defendant carrier
liable for the cost of cleaning plaintiff’s chemical storage tank
after carrier had mistakenly delivered the wrong chemical,
plaintiff had emptied the chemical into the tank, and massive
clean-up was required).

11
Although its bleachers were eventually found,33 the Circus had

already fully paid for its new bleachers by that time, and the jury

implicitly rejected Mason’s argument that the Circus should have

mitigated its damages by selling the old bleachers once they were

recovered. The Circus had no reason to believe that the bleachers

would be found or returned and, under these circumstances, made a

reasonable decision to purchase new ones. The Circus was properly

compensated for its actual loss, the cost of the new bleachers.

For these reasons, the district court’s judgment is, in all

respects,

AFFIRMED.

33
Mason did not even deliver the bleachers to the Circus,
however; it merely notified the Circus of the found trailer,
requiring the Circus to send a tow truck to fetch its bleachers
from Arkansas.

12