Household Goods Carriers' Bureau v. Interstate Commerce Commission

WILKEY, Circuit Judge,

concurring in part and dissenting in part.

I dissent from Part I of Judge Robb’s opinion for the Court concerning the extraordinary value rule. Section 216(b) of the Interstate Commerce Act (the “Act”) authorizes carriers to establish and enforce regulations governing the manner .and method in which shippers are to present, mark, pack and deliver property for transportation.1 Pursuant to this statutory authorization, the household goods carriers (the “Carriers”), petitioners here, adopted a regulation requiring shippers to notify carriers if certain designated items of extraordinary value, such as currency, bullion, and jewelry, are included in shipments by noting such items on the shipping documents.2 The regulation states that a carrier will not assume liability for any such designated items not listed on the shipping document.

The purpose of this notification requirement is evident. The types of articles designated are generally small in size, easy to *294conceal, and high in value. The requirement that a shipper notify a carrier that such items are included in a shipment serves several important functions: first, it enables the carrier to provide the extra degree of protection necessary for safe handling of the article and commensurate with its high value; second, it protects the carrier and its employees against fraudulent assertions of loss by shippers; and third, it provides information necessary for the carrier to maintain proper insurance coverage of its operations.

In its 1 March 1976 order,3 the Interstate Commerce Commission (the “Commission”) struck down the Carriers’ notification requirement on the ground that it was an exemption from, or limitation on, liability and, therefore, was in violation of Section 20(11) of the Act. That Section prohibits a carrier from exempting itself from liability, or limiting its liability, for loss or damage to property received by it for transportation, except with respect to property concerning which the carrier has been expressly authorized or required by the Commission to maintain rates dependent upon the value declared by the shipper in writing, or agreed upon in writing as the released value of the property.4

In my view the Carriers’ notification requirement is not an exemption from, or limitation on, liability prohibited by Section 20(11) of the Act. Rather, the notification requirement is a classic example of a condition of acceptance imposed by the carrier on shippers tendering property for transporta*295tion. Such conditions, designed not to limit liability but to control the risk of loss itself, have always been upheld if reasonable.5 Therefore, I would hold that the Commission exceeded its authority in striking down the Carriers’ notification requirement as violative of Section 20(11).

The majority acknowledges that there is a distinction between a condition of acceptance and a limitation on liability but states that “carriers can so abuse a particular condition that it operates, not as a condition of acceptance, but as a limitation on liability”. This is, of course, true. In such a case the condition would be unreasonable and, hence, a violation of Section 216(b). As I discuss more fully in part III of this dissent, the appropriate response by the Commission would be to strike down that particular condition or delete those features of the condition it deemed unreasonable. But this is not what has happened here. In this case the Commission has found that two or three words in the current version of the carrier’s extraordinary value rule are ambiguous and lend themselves to abuse so that they operate as limitations on liability. On this basis, the Commission has not just struck down this particular version of the rule, rather it has completely outlawed any and all extraordinary value rules; it has declared that all extraordinary value rules, no matter how reasonable and how tightly drawn, are per se violative of Section 20(11). In short, it has exterminated a whole forest because it found a few dead branches on one tree. This is clearly wrong and beyond the authority of the Commission.

I. THE DISTINCTION BETWEEN LIMITATIONS ON LIABILITY AND CONDITIONS OF ACCEPTANCE

The validity of the Carriers’ notification requirement under Section 20(11) of the Act turns on the fundamental distinction between “limitations on liability” and “conditions of acceptance.” Section 20(11) was intended to cover the former and not the latter.

A. Limitations on Liability

At common law, the common carrier was a virtual insurer of the property it accepted for transportation, liable regardless of fault for the full amount of any loss or damage to such property unless it could show that the loss or damage was caused by (1) an act of God, (2) an act of the public enemy, (3) the inherent nature of the property shipped, (4) the act or omission of the shipper, or (5) the act or mandate of public authority.6 The law was well settled, however, that a carrier could, unless forbidden by statute, place limitation and restrictions on this extensive common-law liability by means of a special contract.7 Thus it was generally *296held that a carrier could bargain with a shipper for special terms in the carriage contract discharging the carrier from its broad common law responsibilities and supplanting them with contractual responsibilities of a more limited scope.

Thus, a limitation on liability was a stipulation which became part of the carriage contract and which qualified, by its own force, the carrier’s liability for property accepted for transportation by either (1) excluding or excepting from coverage risks of loss or damage to the property caused by specified contingencies or perils, or (2) specifying a limit on the amount of indemnity which the carrier had undertaken to pay the shipper in the event of loss.8 A common example of an exclusion of risk was a stipulation exempting a carrier from liability for loss due to fire or theft — risks otherwise covered by a carriage contract in the absence of agreement to the contrary.9 A common example of a limitation on indemnity was a stipulation providing that the carrier would be liable only for a predetermined amount, called an agreed valuation, in the event of loss or damage to a particular item of property, whether or not the agreed amount corresponded to the actual value of the property damaged.10

It must be emphasized that stipulations limiting the carrier’s common-law liability could not be unilaterally imposed on the shipper by the carrier. Conceptually, the common carrier was under a pre-existing duty to accept the shipper’s goods and transport them at a reasonable rate subject to its full common law responsibility, and therefore, the shipper was entitled to demand that the carrier transport the goods without any exemption from, or limitation on, liability.11 This meant that any limitation on liability had to be bargained for by the carrier. This had three consequences. First, any exemption from, or limitation on, liability had to be assented to by the shipper.12 Second, the exemption or limitation had to be supported by consideration in the form of reduced rates.13 Third, the carrier had to give the shipper the option of shipping its goods under the carrier’s restricted liability in consideration for a lower rate or of shipping its goods under the carrier’s common-law liability at a higher, though presumably still reasonable, rate.14

Although, theoretically, a shipper had the right to insist that a carrier transport goods under its full common-law liability, a problem developed when carriers used their superior bargaining power to insert exemptions and limitations on liability in the carriage contracts. As the United States Supreme Court noted:15

The carrier and his customer do not stand upon a footing of equality. The individual customer has no real freedom of choice. He cannot afford to higgle or stand out, and seek redress in the courts. He prefers rather to accept any bill of lading, or to sign any paper, that the carrier presents; and in most cases he has no alternative but to do this, or to abandon his business.

One particular problem was that many carriers began to publish reduced rates based on agreed values and prohibitively high *297rates based on actual values of property shipped.16 The net result of this practice was that shippers had no effective choice of rates and were denied full and fair recovery for shipments lost or damaged in transit.

Another problem relating to the carriers’ practice of inserting in their carriage contracts restrictions on their common-law liability was the lack of uniformity in the law governing interstate shipments. Prior to federal legislation on the subject of carrier liability for goods carried in interstate shipments, the states were empowered to establish and apply their own laws and policies with respect to such liability and the right of the carrier to limit it by contract.17 The efforts of carriers to limit their common-law liability by contract led to many different limitation provisions in bill of lading forms, and these varying terms were subject to construction by state courts and the application of varying policies by state legislatures and state courts. This lack of uniformity was a source of confusion and controversy in determining the liability of a common carrier on an interstate shipment.

It was in response to this dual problem of carrier overreaching and lack of uniformity that Congress enacted legislation controlling the right of carriers to seek exemptions from, or limitations on, their liability by special contract.18 In 1906 Congress enacted the so-called Carmack Amendment.19 This Amendment, as modified by the First Cummins Amendment of 191520 and the Second Cummins Amendment of 1916,21 became Section 20(11) of the Interstate Commerce Act, and it restricts the right of carriers to limit their liability.22 Its specific provisions will be addressed shortly.23 The point to be made here is that this legislation was directed at problems raised by contractual limitations on the common-law liability of the common carrier. It was not concerned with the entirely separate and distinct carrier practice of imposing reasonable conditions on their acceptance of goods tendered by a shipper — conditions designed not to limit liability, but rather to control the risk of loss itself.

B. Conditions of Acceptance

The rigorous liability which the common law imposed on the carrier (and which the carrier sought to limit by contract) did not attach until the carrier had accepted property for immediate shipment.24 This is important because a carrier was not considered absolutely bound to accept all property tendered for shipment.25 At common law the carrier had an undoubted right to condition its acceptance of goods on shipper compliance with just and reasonable rules and regulations designed to (1) promote efficient operations, (2) insure the safe transportation of property, and (3) protect the carrier from fraud and imposition. Thus, it was generally held that a carrier could make rules fixing the method and forms in which it would receive freight for transportation.26 These rules were usually framed and enforced as conditions of acceptance. A condition of acceptance was a stipulation *298which called for the performance of some act by the shipper before the carriage contract would come into existence. It was a condition precedent to the formation of a contract, and the carrier assumed no liability until there had been compliance with the condition by the shipper.

Examples of conditions of acceptance were stipulations by the carrier that it would not accept property for transportation unless the shipper tendering the property had packed it according to certain standards,27 marked it according to certain guidelines,28 or identified for the carrier any perishables or extraordinarily valuable items included in the tendered shipment.29

The common law was clear on the consequences of shipper non-compliance with a carrier’s reasonable condition of acceptance. If a shipper tendered property which did not conform to the carriers’ conditions, the carrier could properly reject the shipment.30 Moreover, if a shipper induced a carrier to receive unwittingly a non-conforming shipment, then it was held that no enforceable contract existed between the carrier and shipper as to that shipment and that consequently the carrier could not be held liable for loss or damage thereto.31 It was said that, in such a case, the carrier had never “accepted” the shipment and hence had never assumed liability for the property.32

There was, at common law, a special type of condition of acceptance which called.for the shipper to make representations regarding the nature of property tendered for shipment.33 A regulation, requiring a shipper to notify a carrier if extraordinarily valuable articles were included in a shipment, is an example of such a condition.34 In the landmark case of Hart v. Pennsylvania Railroad Co.;35 the Supreme Court noted the traditional right of carriers to condition their acceptance of goods on shipper compliance with such a rule:36

As a general rule, and in the absence of fraud or imposition, a common carrier is answerable for the loss of a package of goods though he is ignorant of its contents, and though its contents are ever so *299valuable, if he does not make a special acceptance. This is reasonable, because he can always guard himself by a special acceptance, or by insisting on being informed of the nature and value of the articles before receiving them. (Emphasis added.)

If a shipper did not accurately represent the nature of its shipment either by express misrepresentation or by silence, its conduct was deemed such a fraud on the carrier as to invalidate the contract or estop the shipper from making any claim thereon.37 This principle and the policies underlying it have been stated as follows:38

The carrier has a clear right to know the contents of packages offered for shipment, in order that he may fix his compensation and know his risk. The statement of the shipper as to the character of an article not open to inspection is a representation as to a material factor of the contract, upon which the carrier may rely; and, if the value or character of the article actually shipped so varies from the contents of the package as represented as to materially affect the compensation of the carrier or the risk or expense of transportation, the carrier is not liable for the article of greater value received under a misapprehension caused by the shipper’s untrue statement. This is merely the application of the familiar principle that a party to a contract is held only to that liability which falls fairly within the terms of the contract, and it makes no difference if an item which the other party wished to cover was omitted by his fraud or by his negligence.
It is said in Hutchinson on Carriers, § 213: “Fraud may be as effectually practiced upon the carrier by silence as by a positive and express misrepresentation. A neglect or failure to disclose the real value of a package and the nature of the contents, if there be anything in its form, dimensions, or other outward appearance which is calculated to throw the carrier off his guard, whether so designed or not, will be conduct amounting to a fraud upon him. The intention to impose upon him is not material. It is enough if such is the practical effect of the conduct of the shipper, as if a box or package, whether designedly or not, is so disguised as to cause it to resemble such a box or package as usually contains articles of little or no value, whereby the carrier is misled. For by such deception the carrier is thrown off his guard, and neglects to give to the package the care and attention which he would have given it had he known its actual value.”

The rule at issue in this case reads as follows:

(i) No liability need be assumed for loss of or damage to any article of the following kinds UNLESS such article is specifically listed on the shipping document: bills of exchange, bonds, bullion or precious metals, currency, deeds, documents, evidences of debt, credit cards, firearms, money, gems, jewelry, watches, precious stones, pearls, gold, silver or platinum articles, stock certificates, securities, stamp collections, stamps, letters or packets of letters, musical instruments of rare quality or historical significance, first editions or autographed copies of books, antique furniture, heirlooms, paintings, sculptures, works of art, and hobby collections.

This is a classic example of a condition of acceptance requiring shipper representation. Similar regulations have consistently been upheld by the courts as reasonable conditions.39 In the old Pennsylvania case *300of Yaeck v. Adams Express Co.,40 for example, the carrier’s receipt contained the following clause:

3. Said property is accepted as merchandise only, and the company shall not be liable for the loss of money, bullion, bonds, coupons, jewelry, precious stones, valuable papers or other matter of extraordinary value unless such articles are enumerated in the receipt, as the company does not transport such articles except through its money department.

The suit was to recover for loss of jewelry contained in plaintiff’s shipment. The court held for the defendant carrier, rejecting plaintiff’s argument that the clause was an improper limitation on liability:41

The clause relating to jewelry in the receipt is a valid regulation of the defendant’s business. It has not the effect to exempt the carrier from liability for negligence but is a proper notice that certain merchandise of unusual value is carried under special conditions only. Gold, jewelry and precious stones are peculiarly the subjects of cupidity and are as a matter of common prudence more carefully handled and securely guarded than ordinary merchandise. It is reasonable therefore that a carrier when called upon to transport such property should make a special acceptance and prescribe the conditions under which it is to be shipped. This right is not inconsistent with the rule that the carrier can not exempt himself from liability for the negligence of himself or his employees. He is entitled to receive compensation proportionate to the risk and to protect himself from fraud or imposition by reasonable rules and regulations: Hart v. Penna. Ry. Co., 112 U.S. 331 [5 S.Ct. 151, 28 L.Ed. 717]; Adams Express Co. v. Croninzer, 226 U.S. 491 [33 S.Ct. 148, 57 L.Ed. 314]. . . .
The evident purpose of the provision was to distinguish the enumerated articles from merchandise generally and to provide that for the shipment of a more valuable class a special method be used which required the statement in the receipt of the particular articles included in the shipment. This was in the interest of both the shipper and carrier as the plan adopted by the company insured greater care and a better means of ascertaining the time and place of losses if any should occur.

Thus, the distinctive feature of a true condition of acceptance at common law was that it did not restrict or limit a carrier’s liability. If the shipper complied with the condition, then the carrier accepted the property subject to its full common-law liability 42 If the shipper did not comply with the condition, then the carrier assumed no liability to start with. The non-liability of the carrier for loss or damage to non-conforming property, therefore, did not result from the operation of the condition but rather from the wrongful conduct of the shipper. Furthermore, conditions of acceptance did not have to be bargained for by the carrier. The carrier had the right to impose such conditions so long as they were reasonable. Therefore, in contrast to limitations on liability, conditions of acceptance did not have to be supported by consideration in the form of reduced rates. Nor was it necessary for the shipper to assent to the conditions; it was enough that the shipper received notice of their terms.43

Finally, the respective purposes of conditions of acceptance and limitations on liability are much different. Limitations on liability were designed to restrict the scope of the risk assumed by a carrier. Conditions of acceptance were designed to control the *301risk by reducing the chances of loss. The carrier assumed risks which included both physical and moral hazards — the physical hazard of actual loss, the moral hazard of fraudulent claim. By imposing reasonable conditions of acceptance the carrier was better able to prevent against the physical hazard and protect against the moral hazard. Thus, reasonable conditions of acceptance did not change the nature of the undertaking of the common carrier, or limit its obligation in the care and management of that which was entrusted to it; rather, they improved the ability of the carrier to meet successfully the full-range of its responsibilities. They were, therefore, to the mutual advantage of the carrier and the shipper.

II. NON-APPLICABILITY OF SECTION 20(11) TO CONDITIONS OF ACCEPTANCE

In my view, the common-law distinction between conditions of acceptance and limitations on liability has been preserved under the Interstate Commerce Act. Section 216(b) of the Act preserves the right of carriers to impose reasonable conditions of acceptance, whereas Section 20(11) restricts the former right of carriers to bargain for limitations on their common-law liability.44

The Commission contends, however, that the proscriptions in Section 20(11) against certain limitations on liability extend to conditions of acceptance such as the carriers’ extraordinary value rule. This position, accepted by the majority, cannot be sustained in light of the language of Section 20(11), the case law construing the provision, and the Commission’s own interpretation of it with respect to carriers’ rules on perishables.

By its terms, Section 20(11) applies only to carriers “receiving property for transportation.” This suggests that the provision is intended to cover cases where the carrier has actually accepted goods for carriage and is seeking limited liability under its carriage contract.45 Conversely, the provision does not cover cases where the carrier has not accepted goods for transportation. A carrier that conditions its acceptance of designated articles on shipper compliance with a rule such as the one here in issue cannot be deemed to have “accepted” such articles where notification has been withheld and the articles have been secreted in the shipment without the carrier’s knowledge. Thus, Section 20(11) does not prevent carriers from adopting, under authority of Section 216(b), reasonable conditions precedent to their acceptance of property; the extraordinary value rule is, therefore, not in conflict with the statute.

This interpretation has been adopted by the few courts that have considered the applicability of Section 20(11) to carrier conditions of acceptance, such as the extraordinary value rule. These courts have held that the extraordinary value rule does not violate Section 20(H).46 In Garrett v. Greyhound Van Lines, Inc.,47 for example, a *302carton containing watch jobs and two pistols with a total value of $10,300.00 was missing from an interstate shipment of household goods at the time of delivery. The court found that the shipper had a full opportunity to disclose these articles of extraordinary value to the carrier but did not do so. In considering the validity of the carrier’s rule relieving it from liability for articles of extraordinary value coming into its possession without its knowledge, the court stated:48

• I find that the defendant is not liable for this loss since it did not at any time undertake to transport these valuable items. .
Under the provisions of 49 U.S.C. Sec. 20(11) a common carrier is liable for the full actual loss caused by it to the goods it transports unless it has previously entered into an agreement with the shipper for a released or declared value on those goods. This statute had no application in a situation such as here where the shipper deliberately withholds from the carrier information regarding the existence of goods of extraordinary value and attempts to transport them at the lowest rate available along with goods of ordinary value. Hecker Products Corp. v. Transamerica Freight Lines, Inc. [296 Mich. 381], 296 N.W. 297 (Mich.1941); Allied Van Lines, Inc. v. Smith [28 Colo.App. 85], 470 P.2d 926, (Colo.App.1970). A contrary result may have been reached if some disclosure had been made of the identity of these goods. Thomas Electronics, Inc. v. H. W. Tayton Co., 297 F.Supp. 639 (M.D.Pa.1967).

In addition to the court cases which hold that the extraordinary value rule does not violate Section 20(11), the Commission itself recognizes that a rule of this kind is not a violation of the statute.49 In its 1 March Order here under review the Commission adopted a regulation which expressly authorizes the carriers to establish a tariff rule relieving themselves of liability in the absence of knowledge that a particular type of article is contained in a shipment. The regulation reads as follows:50

Section 1056.16 Liability of carriers.
(i) No liability need be assumed for perishable articles included in the shipment without the knowledge of the carrier; and a carrier accepting for shipment perishable articles may impose reasonable conditions necessary to insure the safe transportation of such commodities.

One need only substitute the words “article of extraordinary value” for the words “perishable items”, and the extraordinary value rule appears in abbreviated form.

This is not an authorization by the Commission to the carrier for publication of a limited liability rule for perishables based on the value declared for such articles, in accordance with the exception in Section 20(11). Rather, it is an authorization to publish a rule completely exonerating the carrier from liability for loss or damage to such articles, where the carrier has no knowledge that the perishable articles are contained in the shipment. The Commission could not have adopted this regulation if the prohibition in Section 20(11) were construed as extending to a rule of this type. Likewise, the Carriers’ extraordinary value rule, which in principle is the same as *303the rule authorized by the Commission for perishables, is not within the prohibition of Section 20(11).

In sum, then, the language of Section 20(11), the reasons for its enactment, the case law, and the Commission’s own interpretation of the provision as exemplified in the rule on perishables, all indicate that Section 20(11) poses no bar to the Carriers’ extraordinary value rule. Justification for the Commission’s action in striking down this longstanding rule must be found elsewhere than in the proscriptions of Section 20(11).

III. THE REASONABLENESS OF EXTRAORDINARY VALUE RULE

The proper standard for evaluating the validity of a carrier-imposed condition of acceptance, such as the extraordinary value rule here at issue, is the “reasonableness ” of the condition. This was the test of validity at common law,51 and this standard has been preserved in Section 216(b) of the Act.52

It may well be that this particular extraordinary value rule unreasonably impinges on the rights of the shipping public by its use of ambiguous and elastic generic terms which lend themselves to abuse. It may be unreasonable to expect shippers to identify “heirlooms”, or “antique furniture”, or even “works of art”. Perhaps these somewhat vague terms do give carriers the opportunity to make bad faith assertions after a loss or damage claim has been filed. If the specific list of items now contained in the Carriers’ extraordinary value rule includes any particular item which the Commission deems unreasonable, the Commission certainly could require that particular item be corrected or deleted. But the Commission has not followed this reasonable approach. Acting on the mistaken belief that the rule was in principle violative of Section 20(11), the Commission has struck down the rule in toto, and implicitly proscribed all such rules no matter how tightly drawn. This action was clearly beyond the Commission s authority.

I respectfully dissent.

. 49 U.S.C. § 316(b). This subsection provides:

It shall be the duty of every common carrier of property by motor vehicle to provide safe and adequate service, equipment, and facilities for the transportation of property in interstate or foreign commerce; to establish, observe, and enforce just and reasonable rates, charges, and classifications, and just and reasonable regulations and practices relating thereto and to the manner and method of presenting, marketing, packing, and delivering property for transportation, the facilities for transportation, and all other matters relating to or connected with the transportation of property in interstate or foreign commerce.

. The rule reads as follows:

(i) No liability need be assumed for loss of or damage to any article of the following kinds UNLESS such article is specifically listed on the shipping document:
bills of exchange, bonds, bullion or precious metals, currency, deeds, documents, evidences of debt, credit cards, firearms, money, gems, jewelry, watches, precious stones, pearls, gold, silver or platinum articles, stock certificates, securities, stamp collections, stamps, letters or packets of letters, musical instruments of rare quality or historical significance, first editions or autographed copies of books, antique furniture, heirlooms, paintings, sculptures, works of art, and hobby collections.

J.A. at 179

. Practices of Motor Carriers of Household Goods (Limitations on Liability), Ex Parte No. MC-19 (Sub-No. 20). 1 March 1976, reproduced in J.A. at 166-198.

. 49 U.S.C. § 20(11):

(11) Any common carrier, railroad, or transportation company subject to the provisions of this chapter receiving property for transportation from a point in one State or Territory or the District of Columbia to a point in another State, Territory, District of Columbia, or from any point in the United States to a point in an adjacent foreign country shall issue a receipt or bill of lading therefor, and shall be liable to the lawful holder thereof for any loss, damage, or injury to such property caused by it or by any common carrier, railroad, or transportation company to which such property may be delivered or over whose line or lines such property may pass within the United States or within an adjacent foreign country when transported on a through bill of lading, and no contract, receipt, rule, regulation, or other limitation of any character whatsoever shall exempt such common carrier, railroad, or transportation company from the liability imposed; and any such common carrier, railroad, or transportation company so receiving property for transportation from a point in one State, Territory, or the District of Columbia to a point in another State or Territory, or from a point in a State or Territory to a point in the District of Columbia, or from any point in the United States to a point in an adjacent foreign country, or for transportation wholly within a Territory, or any common carrier, railroad, or transportation company delivering said property so received and transported shall be liable to the lawful holder of said receipt or bill of lading or to any party entitled to recover thereon, whether such receipt or bill of lading has been issued or not, for the full actual loss, damage, or injury to such property caused by it or by any such common carrier, railroad, or transportation company to which such property may pass within the United States or within an adjacent foreign country when transported on a through bill of lading, notwithstanding any limitation of liability or limitation of the amount of recovery or representation or agreement as to value in any such receipt or bill of lading, or in any contract, rule, regulation, or in any tariff filed with the Interstate Commerce Commission; and any such limitation, without respect to the manner or form in which it is sought to be made is declared to be unlawful and void: . . . Provided, however, That the provisions hereof respecting liability for full actual loss, damage, or injury, notwithstanding any limitation of liability or recovery or representation or agreement or release as to value, and declaring any such limitation to be unlawful and void, shall not apply, first, to baggage carried on passenger trains or boats, or trains or boats carrying passengers; second, to property, except ordinary livestock, received for transportation concerning which the carrier shall have been or shall be expressly authorized or required by order of the Interstate Commerce Commission to establish and maintain rates dependent upon the value declared in writing by the shipper or agreed upon in writing as the released value of the property, in which case such declaration or agreement shall have no other effect than to limit liability and recovery to an amount not exceeding the value so declared or released ....

. See discussion in part I.B. of this opinion.

. E. g., Shapiro v. Pennsylvania R. Co., 65 App.D.C. 324, 83 F.2d 581 (1936).

. E. g., American R. Exp. v. Levee, 263 U.S. 19, 44 S.Ct. 11, 68 L.E.d. 140 (1923); Boston & M. R. Co. v. Piper, 246 U.S. 439, 38 S.Ct. 354, 62 L.Ed. 820 (1918); Adams Exp. Co. v. Allendale Farm, 116 Va. 1, 81 S.E. 42 (1914); Willock v. Pennsylvania R. Co., 166 Pa. 184, 30 A. 948 (1895).

There was, however, a definite limit on the extent to which a carrier could restrict its common-law liability by special contract. It was uniformly held that the carrier could not relieve itself from liability for loss or damage caused by its own willful or negligent acts. E. g., Adams Exp. Co. v. Croninger, 226 U.S. 491, 33 S.Ct. 148, 57 L.Ed. 314 (1913). Any term in a carriage contract purporting to relieve a carrier from such liability was deemed void as against public policy. There was some conflict at common law, however, concerning the validity of special contracts limiting the amount recoverable by a shipper by providing that the carrier’s liability was not to exceed an agreed valuation. Some courts held that such valuation agreements fell under the condemnation of the general principle prohibiting contracts which relieved the carrier from liability for negligence. E. g., Chicago, R. I. & P. R. Co. v. Witty, 32 Neb. 275, 49 N.W. 183 (1891). The majority of courts, however, held that, in the absence of a statutory prohibition, a carrier could restrict by contractual agreement the amount recoverable by the shipper in case of loss or damage to property transported, even where the loss or damage was caused by the negligence of the carrier. E. g., Graves v. Lake Shore & M. S. R. Co., 137 Mass. 33, 50 Am.Rep. 282 (1884). The federal courts adopted this latter position. Hart v. Pennsylvania Railroad Co., 112 U.S. 331, 5 S.Ct. 151, 28 L.Ed. 717 (1884).

. Compare Chicago & N. W. R. Co. v. Chapman, 133 Ill. 96, 24 N.E. 417 (1890), and Tarbell v. Royal Exchange Shipping Co., 110 N.Y. 170, 17 N.E. 721 (1888), with D’Utassy v. Barrett, 219 N.Y. 420, 114 N.E. 786 (1916), and Donlon Bros. v. Southern P. Co., 151 Cal. 763, 91 P. 603 (1907).

. E. g., Arthur v. Texas & P. R. Co., 204 U.S. 505, 27 S.Ct. 338, 51 L.Ed. 590 (1907).

. E. g., Union P. R. Co. v. Burke, 255 U.S. 317, 41 S.Ct. 283, 65 L.Ed. 656 (1921).

. See generally R. Brown, The Law of Personal Property § 12.14 (3rd ed. 1975).

. E. g., Michigan C. R. Co. v. Mineral Springs Mfg. Co., 16 Wall. 318, 83 U.S. 318, 21 L.Ed. 297 (1872).

. E. g., Lake Erie & W. R. Co. v. Holland, 162 Ind. 406, 69 N.E. 138 (1903).

. E. g., F. A. Straus & Co. v. Canadian & P. R. Co., 254 N.Y. 407, 173 N.E. 564 (1930).

. Liverpool & Great Western Stream Co. v. Phenix Insurance Co., 129 U.S. 397, 441, 9 S.Ct. 469, 471, 32 L.Ed. 788 (1889).

. See Rules, Regulations, and Practices of Regulated Carriers With Respect to the Processing of Loss and Damage Claims, 340 I.C.C. 515, 521 (1972).

. See generally R. Sigmon, Miller’s Law of Freight Loss and Damage Claims 7-18 (4th ed. 1974).

. Id.

. 34 Stat. 595.

. 38 Stat. 1197.

. 39 Stat. 441.

. See text of Section 20(11) at note 4, supra.

. See discussion at page 301 of 189 U.S.App. D.C., at page 459 of 584 F.2d, infra.

. E. g., Dugdale Packing Co. v. Atchison, Topeka & Santa Fe R. Co., 347 F.Supp. 1276 (1972).

. E. g., Southern Exp. Co. v. R. M. Rose Co., 124 Ga. 581, 53 S.E. 185 (1906); Kirby v. Western U. Tel. Co., 4 S.D. 105, 55 N.W. 759 (1893).

. See, e. g., Central of Georgia Ry. Co. v. Smith, 31 Ga.App. 135, 120 S.E. 30 (1923); Coupland v. Housatonic R. Co., 61 Conn. 531, 23 A. 870 (1892); Oppenheimer v. U. S. Exp. Co., 69 Ill. 62 (1873).

. E. g., Thompson-Houston Electric Co. v. Simon, 20 Or. 60, 25 P. 147 (1890).

. E. g., Bell Tel. Co. v. American Exp. Co., 92 Pa.Super. 180 (1927).

. E. g., Yaeck v. Adams Exp. Co., 69 Pa.Super. 143 (1918).

. E. g., Southern Exp. Co. v. R. M. Rose Co., 124 Ga. 581, 53 S.E. 185 (1906).

. E. g., Kirwan v. Railway Express Agency, Inc., 718 Pa.Super. 431, 179 A. 924 (1935); Bell Tel. Co. v. American Exp. Co., 92 Pa.Super. 180 (1927), Yaeck v. Adams Exp. Co., 69 Pa.Super. 143 (1918).

. E. g., Charleston & Savannah Ry. Co. v. Moore, 80 Ga. 522, 5 S.E. 769 (1885).

. Such a shipper representation is analogous to a representation made by a prospective insured to an insurer. It may be defined as a statement by the shipper, preceding the contract, and in the nature of an inducement to contract, relating to the existence of facts or conditions concerning the nature of the property tendered for shipment, knowledge of which is necessary for the carrier to form a just estimate of the risk it is assuming so that it may take protective measures commensurate with the risk. Compare 7 Couch on Insurance 2d § 35.3-§ 35.6; 12 Appleman, Insurance Law and Practice, § 7291-§ 7293.

. See, e. g., Kirwan v. Railway Express Agency, Inc., 118 Pa.Super. 431, 179 A. 924 (1935); Yaeck v. Adams Exp. Co., 69 Pa.Super. 143 (1918). Coupland v. Housatonic R. Co., 61 Conn. 531, 549, 23 A. 870, 875 (1892) (“Actual notice, given by a common carrier to his customer, specifying the terms on which he receives and carries goods, becomes parcel of the contract when it is proved that the property was delivered on the terms thus offered. And, though it be not made the basis of a contract, it often becomes effective to shield the carrier from liability for things of special and peculiar value, not disclosed at the time of delivery; for it appears to be agreed that the carrier may in this manner require the shipper to state the nature or value of the property at the risk of having it received and carried as an article of ordinary value. The carrier does not impose an illegal condition. He asks for reasonable information bearing on the transaction; and the shipper is left free to act on his own discretion, accepting the legitimate consequences of his conduct.”)

. 112 U.S. 331, 5 S.Ct. 151, 28 L.Ed. 717 (1884).

. Id. at 340, 5 S.Ct. at 155.

. See, e. g., Southern Exp. Co. v. Hanaw, 134 Ga. 445, 67 S.E. 944 (1910); Chesapeake & O. R. Co. v. Hall, 136 Ky. 379, 124 S.W. 372 (1910); Magnin v. Dinsmore, 62 N.Y. 35 (1875); Bottum v. Charleston & W. C. R. Co., 72 S.C. 375, 51 S.E. 985 (1905); Chesapeake & O. R. Co. v. Osborne, 154 Va. 477, 153 S.E. 865 (1930).

. Bottum v. Charleston & W. C. R. Co., 72 S.C. 375, 51 S.E. 985, 986 (1905).

. See cases citea at notes 34-38, supra.

. 69 Pa. Super. 143 (1918).

. Id at 146.

. Such true conditions of acceptance are to be distinguished from provisions which actually limit liability although they are framed as conditions. See, e. g., Atchison, Topeka & Santa Fe R. Co. v. United States, No. T-4926 (D.Kan., 9 August 1972).

. E. g., Coupland v. Housatonic R. Co., 61 Conn. 531, 23 A. 870 (1892); Oppenheimer v. United States Exp. Co., 69 Ill. 62 (1873); McMillan v. Michigan S. & N. I. R. Co., 16 Mich. 79, 93 Am.Dec. 208 (Mich.1867).

. The text of 49 U.S.C. § 20(11) is set forth at note 4, supra.

. This appears to have been the interpretation placed on the word “receiving” by the Commission itself. In an extensive investigation entitled Ex Parte No. 263, Rules, Regulations, and Practices of Regulated Carriers With Respect to the Processing of Laws and Damage Claims, 340 I.C.C. 515, 522 (1972), the Commission examined Section 20(11) and congressional intent with respect thereto in detail, concluding:

The substance of section 20(11) of the act, then, as it now applies to carriers other than those by water (which will be considered next), represents a restatement of the common law rule that a common carrier is ordinarily a virtual insurer against loss, damage, or injury to property it accepts for transportation, and that only this Commission has the authority to modify this general rule by granting partial exemptions from full liability in cases where the applicable rates depend upon and vary with the declared or agreed values of the goods to be transported (released rates). (Emphasis added).

. Garrett v. Greyhound Van Lines, Inc., No. 70-821 (D.Or., 8 February 1972); Hecker Products Corp. v. Trans-American Freight Lines, Inc., 296 Mich. 381, 296 N.W. 297 (1941). Cf. Allied Van Lines, Inc. v. Smith, 28 Colo.App. 85, 470 P.2d 926 (1970).

. See note 46, supra; opinion reproduced in Petitioner’s Brief, Appendix at la~4a.

. Id. at 3a.

. Indeed, the extraordinary value rule and Section 20(11) have coexisted under the Commission’s watchful eye for over 40 years. Section 20(11) in its present form has been in the Interstate Commerce Act since the Second Cummins Amendment in 1916 (39 Stat. 441). The household goods carriers, along with other motor carriers, were brought under the jurisdiction of the Commission by the Motor Carrier Act of 1935 (Interstate Commerce Act — Part II). On 23 March 1936 the initial household goods carrier tariff was filed by the Household Goods Carriers’ Bureau on behalf of its member carriers. That original tariff contained the extraordinary value rule; and every tariff since that date has contained that rule. Thus, the extraordinary value rule has been a part of the household goods carriers’ tariff and operations for over forty years. Yet, during that entire period of forty years, neither the Commission nor any court has ever held the extraordinary value rule of the household goods carriers to be in violation of section 20(11).

.J.A. at 193 (Emphasis added).

. E. g., Platt v. Lecocq, 158 F. 723 (8th Cir. 1907).

. 49 U.S.C. § 316(b) expressly authorizes “just and reasonable regulations.”