Opinion
Rehearing Granted Aug. 9, 1928.
Appeal from Superior Court, Los Angeles County; Chas. S. Crail, Judge.
Action for damages for theft of goods in storage by George H. England against the Lyon Fireproof Storage Company. From a judgment for plaintiff, defendant appeals.
Affirmed. COUNSEL
Howard S. Clewett, of Los Angeles, for appellant.
Ben F. Gray and Geo. S. Hupp, both of Los Angeles, for respondent.
OPINION
THOMPSON, Justice pro tem.
This is an appeal from a judgment and verdict of $4,000 damages on account of the theft of goods while stored in the defendant’s warehouse at Los Angeles. The defendant was engaged in warehouse business at that city. The plaintiff and his family were about to leave their residence in Los Angeles to travel abroad, and on December 10, 1920, he packed their household goods in various boxes and containers and hauled them to the warehouse of defendant for storage during their absence. These goods were received by the defendant, and the packages were consecutively numbered from 1 to 57, inclusive, and listed upon duplicate warehouse receipts, one of which was retained by the defendant and the other was delivered to the plaintiff. A few days later other boxes and packages of household goods and effects were also delivered to the defendant. This second consignment included seven cases of whisky, the contents of which were made known to the defendant. These goods were also numbered and listed on the back of defendant’s original warehouse receipt, but a duplicate of this last list was not given to the plaintiff. The entire consignment of goods was stored in a separate room in defendant’s warehouse, and the door to the room was securely locked. No other person’s goods were placed in this same storeroom. Several employees of the defendant held pass-keys to all the rooms of the warehouse, including the room in which plaintiff’s goods were stored. When the pass-keys became worn and failed to operate in the locks, new ones were procured and the old ones were carelessly thrown into the wastebaskets or rubbish. Upon other occasions liquor had been stolen from the warehouse, and once another storeroom had been burglarized. The president of the defendant corporation had been warned that a certain one of his employees was a bootlegger, and, while the president admitted that he had secured a detective to investigate the charge, he retained this man in his employ.
Upon plaintiff’s return after three years’ absence, he called upon the defendant to reclaim his property. On going to his storeroom, the employee who accompanied him fumbled with the lock and complained about the difficulty of opening it. Upon unlocking and entering the storeroom, however, he found three boxes opened, empty, and the contents missing, including a number of valuable pictures, hand-painted china porcelain and Dresden ware, bronze and ivory statues, bric-a-brac, rugs and laces of rare value, together with the entire stock of liquor. The liquor was stipulated to be worth $400. Suit was brought against the defendant for negligently suffering theft of the goods, and a verdict of $4,000 was rendered against the defendant.
The defendant seeks a reversal of the judgment on the ground that (1) the boxes in question were received empty, and asserts that the theft never occurred; (2) the judgment is not supported by the evidence, for the reason that there is a total lack of proof of negligence proximately contributing to the theft; that (3) the liability of the defendant was specifically limited by the provisions of section 1840, Civil Code, and the language of the warehouse receipt to $25 per package; and that (4) the trial court erred in giving and refusing certain instructions.
Defendant’s contentions that the boxes in question were empty when they were delivered for storage, and that the theft did not occur, are without merit. The plaintiff himself testified to the packing and specific contents of these boxes, each item of which is mentioned in the complaint. He accompanied the van which hauled them to the warehouse, and went with them to the sixth floor and saw them packed in the storeroom. Defendant’s manager accepted and listed on the warehouse receipt each of these boxes. The liquor was first brought to the warehouse wrapped in heavy paper and without the necessary government permit for removal. The defendant refused to accept it for storage in this condition, and it was returned and repacked in one of the boxes in question, and then brought back to the warehouse with the government permit, which was exhibited to the foreman. These three boxes weighing about 200 pounds each, were then marked by the foreman Nos. 62, 63, and 65, respectively, and were listed by him on the warehouse receipt, in each instance as "box & con." This clearly implies that the boxes, when received by the defendant, were not empty. Upon the contrary, the indorsement on the receipt is an acknowledgment of the existence of "contents" of some sort, in the boxes. Plaintiff was present when the storeroom was first opened at the time when he went to reclaim his property, and immediately observed the broken and empty boxes and commented upon the theft to the employee. This furnishes ample evidence to support the loss of the goods.
In the absence of a specific agreement to the contrary, a bailee or proprietor of a general warehouse does not become an insurer of property against theft. All that is required of him is the exercise of ordinary care for the protection of the owner’s property such as would be used by the owner himself under similar circumstances. The question as to what constitutes reasonable care on the part of a bailee for hire depends largely upon the circumstances of the particular case and upon the value and character of the property entrusted to him. California Warehouse Receipts Acts, Stats. 1909, c. 290; § 21; 25 Cal.Jur. 957, § 15; 27 R. C. L. 992, § 51; 6 C. J. 1121, § 61; 3 R. C. L. 96, § 23; Runkle v. Southern P. Milling Co., 184 Cal. 174, 195 P. 398, 16 A. L. R. 275; Webber v. Bank of Tracy, 66 Cal.App. 29, 33, 225 P. 41; Firestone Tire & Rubber Co. v. Pacific Transfer Co., 120 Wash. 665, 208 P. 55, 26 A. L. R. 217, and note. Mere evidence of the theft of goods left in the custody of a bailee, even though they were stolen by his servant or employee, is insufficient to charge him with negligence and liability for their loss, and the burden is upon the owner to supply evidence from which it may be reasonably inferred that the bailee was guilty of negligence either in the employment of his servants or the management of his business, which negligence proximately contributed to the loss of the goods. 27 R. C. L. 993, § 51; 40 Cyc. 472, § 6; Firestone Tire & Rubber Co. v. Pacific Transfer Co., supra, 120 Wash. 665, 208 P. 58, 26 A. L. R. 217; Exporters’ & Traders’ C. & W. Co. v. Schulze (Tex. Com. App.) 265 S.W. 133; Balice v. Erie Ry. Co., 208 A.D. 427, 203 N.Y.S. 636. Where, however, the owner of the goods has proved a prima facie case of negligence against the warehouseman, the burden is not on the bailor to establish the fact that the bailee failed to operate his business according to the usual custom of warehousemen. In order that an owner may recover damages from a bailee for hire for the theft of his goods, it is necessary that the bailor should sustain the burden of showing acts, conduct, or omissions on the part of the warehouseman amounting to a lack of ordinary care of the property left in his custody, but this burden does not require the bailor to affirmatively prove the usual custom among warehousemen with relation to the operation of their business, as this is a matter of defense, the burden of which rests upon the bailee. Runkle v. Southern P. Milling Co., 184 Cal. 714, 721, 195 P. 398, 16 A. L. R. 275.
In 27 Ruling Case Law, 992, it is said:
"A warehouseman is bound to exercise reasonable care to avoid the theft of the stored goods. *** Such a company is required to use that degree of care in the safe-keeping of property which is demanded from a bailee for hire in the keeping of valuable property. He must use such care in the protection of the property from thieves without and thieves within, in the selection of its employees, and in the supervision of their conduct."
See Cussen v. Southern California Savings Bank, 133 Cal. 534, 65 P. 1099, 85 Am. St. Rep. 221.
In the case last cited, it was held that a bank was liable to the owner for a theft of valuable articles taken from a safe-deposit box, where it was shown that one of the duplicate keys to the box was left accessible to the employees of the bank, and where the vault had been placed in the custody of a 17-year old lad, employed without previous inquiry as to his honesty, and who was paid but $30 per month for his services, and remained in the service of the bank but three months. In sustaining a verdict of a jury in that case, it was said:
"The jury might well say that proper care was not exercised in the selection" or rejection "of this employee."
In that case Justice Garoutte quoted with approval from the case of Preston v. Prather, 137 U.S. 604, 11 S.Ct. 162, 34 L.Ed. 788, as follows:
"Persons, therefore, depositing valuable articles with them except that such measures will be taken as will ordinarily secure the property from burglars outside and from thieves within, *** and also that they will employ fit men, both in ability and integrity, for the discharge of their duties, and remove those employed whenever found wanting in either of these particulars. An omission of such measures would in most cases be deemed culpable negligence so gross as to amount to a breach of good faith, and constitute a fraud upon the depositor."
It will thus be seen that a bailee for hire, who conducts a regular business of storing goods for hire, must exercise due diligence and ordinary care commensurate with the value of the goods stored and the circumstances of the case, to protect the bailor’s property from damage or theft from both without and within the storehouse. He must provide buildings, storage apartments, and facilities for locking the doors and windows adequate to safeguard the goods with ordinary care against the depredations of thieves, and he must exercise due care in the employment and retaining of men about the storehouse, of known honesty and ability.
In the present case it may be inferred from the verdict that the jury of necessity found, not only that the plaintiff’s goods were stolen, but that the defendant was guilty of negligence in the hiring and retaining of employees and the conduct of his warehouse business which proximately contributed to the theft. These findings are supported by substantial evidence sufficient to uphold the verdict and the judgment. Among the goods which were stored and stolen were seven cases of liquor. The defendant had previously lost by theft other consignments of liquor. It had been warned that a certain employee who worked about the storehouse was a bootlegger, which charge imputed dishonesty to the employee. The president of the corporation defendant was suspicious of this employee, and hired a detective to watch him, yet he was not discharged. The plaintiff’s goods were stored in a separate room apart from all other goods, and the door to this room was securely locked. There was no occasion for any employee to visit this room or to have access thereto during the absence of the plaintiff, yet master keys, which fitted all the rooms of this warehouse, were supplied to several employees. When these keys became worn so that they would operate in the locks with difficulty, new ones were replaced, and the old ones were carelessly thrown into a wastebasket or in the débris, where they were accessible to the employees or loafers about the place. We are of the opinion that this evidence furnishes substantial proof of negligence sufficient to support the judgment. In actions involving the negligence of a warehouseman, the usual rule applies with respect to what constitutes ordinary diligence for the protection of the owner’s goods, and, where there is substantial evidence in this regard to support the verdict of a jury, its findings will not be disturbed on appeal. 27 R. C. L. 1004, § 65; 40 Cyc. 482, § 8; Garrette v. Grangers’ Business Ass’n, 58 Cal.App. 396, 208 P. 1010.
The case of Firestone Tire & Rubber Co. v. Pacific Transfer Co., supra, is relied upon by appellant in support of its contention that the evidence in the present case does not uphold the findings of negligence on its part. The facts of that case, however, were radically different from those of the present case. The record discloses the fact that plaintiff rented a space in the defendant’s warehouse in which to store a large quantity of automobile tires. This space was inclosed with a lattice partition which extended only to within three feet of the ceiling, thus leaving an aperture over which one could easily climb. The plaintiff was furnished keys to this inclosure and to the warehouse, and always had free access to both. It was not assumed by the parties that this inclosure was burglar proof. It was constructed and maintained as a mere convenience by means of which to keep plaintiff’s tires separate from other goods which were stored in the warehouse. No goods had been previously stolen from the warehouse, and there was neither suspicion on the part of the defendant nor warning received regarding the dishonesty of its employees. Two of the defendant’s servants did, however, steal the tires. The evidence was deemed to be insufficient to uphold a finding of negligence on the part of the defendant. The foregoing recital of facts readily distinguishes that case from the present one without the necessity of comment. It is therefore not authority for the reversal of this case.
The appellant claims that the damages for loss of the goods in question was limited by contract to the sum of $25 per package. It is true that when the first 57 packages were received and listed a duplicate warehouse receipt signed by respondent was given to him, and contained the following provision:
"It is agreed that said goods shall be stored at owner’s risk of damage by moth, vermin, rust, fire, heat, leakage or injury to fragile articles that are not packed. *** The responsibility of this warehouse for any piece or package, or its contents, is limited to the sum of $25, unless the value thereof is made known at the time of the storing, and receipted for in the schedule, and an additional charge made for the higher valuation. ***"
This provision was not called to the respondent’s attention, and, in listing the packages on the receipt, the foreman of appellant made no inquiry regarding the valuation of the contents of the boxes. There is no affirmative evidence in the record showing that a contract or duplicate receipt similar to the one which was issued affecting the first 57 packages was ever signed by or delivered to the respondent. No such contract appears to have been executed regarding appellant’s limitation of liability for loss of the contents of boxes numbered 62, 63 and 65, which were involved in this action. It does, however, appear that, when the packages which were delivered by respondent subsequent to those which were numbered from 1 to 57, inclusive, the foreman listed the boxes and packages on the back of the original receipt held by appellant, but delivered no copy thereof to the respondent. Moreover, it appears that the nature of the contents of these boxes in question was made known to the foreman, although he neither asked for the value thereof nor indorsed it upon his receipt. The respondent testified:
"Q. You didn’t tell anybody what was in those boxes, did you? A. It wasn’t necessary; they knew. *** The foreman and the men that were-"
The court, interrupting, said:
"He asked you a question. *** A. Yes; I did (tell him the nature of the contents). *** I judged at the time, and have always been under the impression that he (the man who received the goods) was the foreman; he seemed to have authority; he was around with the men and superintended the unloading of the goods. I took it for granted he was the foreman."
Regarding the appellant’s failure to supply respondent with a receipt for the boxes in question, or any package subsequent to that which was numbered 57, the following colloquy occurred at the trial:
Mr. Clewett, attorney for appellant, said: "(All the boxes) numbered up to 57, are on the original receipt."
Mr. Hupp, attorney for respondent, replied: "There is no question about those articles. The only question, as I understand it, is as to articles 62, 63, and 65." Mr. Clewett responded: "Yes; the three boxes which Mr. England has testified were robbed, are the article 62, 63, and 65 on this receipt, which the testimony shows came in later, and, of course, did not appear on the receipt when issued to him."
When the owner of goods which are stored with a warehouseman signs a receipt, which is not in conflict with the provisions of the statute, but which contains limitations as to the liability of the bailee, as to the value of the property, or otherwise, the owner ordinarily becomes bound thereby. 25 Cal.Jur. 962, § 18; 27 R. C. L. 997, § 57; Taussig v. Bode, 134 Cal. 260, 66 P. 259, 54 L. R. A. 774, 86 Am. St. Rep. 250; McMullin v. Lyon Fireproof Storage Co., 74 Cal.App. 87, 95, 239 P. 422; Cunningham v. International Committee of Y. M. C. A., 51 Cal.App. 487, 197 P. 140; Wilson v. Transfer & Storage Co., 201 Cal. 701, 258 P. 596. But the contract of a bailee for hire, which seeks to exempt him from liability resulting from his own negligence, or which seeks unfairly or in bad faith to limit the amount of his liability, will be cautiously scrutinized, and such provisions will not be upheld unless they clearly appear to conform to the intention of the contracting parties. 27 R. C. L. 998, § 57. The contract of a bailee which purports to exempt him from liability for loss or damage resulting from specified causes will not relieve him from the necessity of exercising ordinary care for the protection of the property intrusted to him. 27 R. C. L. 998, § 57; Langford v. Nevin (Tex. Com. App.) 298 S.W. 536. In the present case, since there was no contract limiting the liability of the appellant with respect to the contents of the particular three boxes in question, and since the contents of these boxes was made known to its foreman, who made no inquiry as to their actual value, but who must be presumed to have known from the character of the contents that the value of each box was greatly in excess of $25, the appellant is not entitled to claim the benefit of this limitation of value. Nor is the appellant relieved from liability pursuant to section 1840, Civil Code, which declares:
"The liability of a depositary for negligence cannot exceed the amount which he is informed by the depositor, or has reason to suppose, the thing deposited to be worth."
Knowing the character of the contents of these boxes in question, the appellant had reason to suppose they were worth vastly more than $25 per box. It was stipulated that the liquor alone was worth $400. There is no evidence to indicate that appellant had reason to suppose the value of the contents of these boxes was worth less than the amount of the verdict.
Finally, the appellant assigns as error the giving and refusing of certain instructions by the court. Defendant’s instruction No. 17, which was refused, charged the jury that:
"*** An employer is presumed to have exercised due care in the choice of his employees, and the burden of proof is on the plaintiff to show that the defendant failed to exercise such care, and the mere fact that an employee may prove to be dishonest is no evidence of negligence on the part of the employer, or of failure to exercise due care in the choice of such employee."
The refusal of this instruction was not error, since it was fully covered by other instructions which were given. The court charged the jury that a bailee for hire was not an insurer of the safety of property intrusted to him, but was required to use only ordinary care to protect it from damage or loss such as a prudent man would exercise for the preservation of his own property. And the jury was further instructed:
That the defendant "was required to use such (ordinary) care in the selection of its employees and in the supervision of their conduct after they were employed."
And further that, "if it is established that the property was stolen *** by the servants of the bailee, *** it is then incumbent upon the bailor to introduce evidence from which the jury might legitimately infer that the loss or theft was due to lack of ordinary care on the part of the bailee."
And also that "the burden *** is on the plaintiff to show that the defendant failed to exercise due care in the choice of its employees, and the mere fact that an employee may prove to be dishonest, is no evidence of neglect on the part of the employer, or of failure to exercise due care in the choice of such employee."
These and other instructions along this line, fully advised the jury that the burden was upon the plaintiff to prove the negligence of the defendant in the employment of dishonest servants, before it could be held liable on that score.
The court also refused to give defendant’s instructions numbered 2D, 13, 13A, and 15, to the effect that, by delivering to respondent the duplicate warehouse receipt upon which was listed the first delivery of packages numbered from 1 to 57, inclusive, together with the printed notice of a $25 limitation of liability thereto attached, he acquiesced in such limitation of value as to all subsequent boxes delivered, for the reason that all the goods were stored in the same room, and the plaintiff failed to disclose to the defendant the actual value of the property. The refusal to so instruct the jury was not error, since there was no evidence in the record that such limitation of value applied to the boxes and packages subsequently delivered, among which were the three involved in this action. The limitation of liability on the part of a bailee depends entirely upon contract, and the mutual understanding and intention of the parties. It would be a violent presumption which would limit an owner of three boxes of valuable art goods worth $4,000, to a recovery of $75 for their theft, through the negligence of a bailee, merely because a warehouse receipt was issued for a previous consignment of goods containing a stereotype limitation, even though all the goods were stored in the same room. This is particularly true when no receipt is given for the subsequent consignment, and the character of the goods is made known to the bailee, who lists them and makes no inquiry regarding their actual value. The facts of the present case completely refute the inference that there was an agreed limitation of valuation of the contents of the three boxes in question.
The record is absolutely devoid of evidence indicating that either an oral or a written agreement existed between the parties respecting a limitation of liability for the loss of the contents of the three boxes numbered 62, 63, and 65. Therefore there was no harm in the court instructing the jury, as it did, that:
"The defendant cannot limit its liability against its own negligence by contract, and any contract to that effect would be void."
A judgment will not be reversed for the giving of an instruction which does not harm the appellant, or for the giving of an erroneous instruction upon a matter regarding which there is no conflict in the evidence, where it clearly appears that the jury was not misled to thereby render an erroneous verdict. 2 Cal.Jur. 1026, § 611; Estate of Gharky, 57 Cal. 274. Moreover, the jury was fully, fairly, and correctly instructed regarding the measure of damages for the loss of goods resulting from the negligence of a bailee, as follows:
"It is an express provision of the law that the liability of a depositary for negligence cannot exceed the amount which he is informed by the depositor, or has reason to suppose the thing deposited to be worth." Section 1840, Civil Code.
And, "if you believe from the evidence that the plaintiff did not inform the defendant of the value of the contents of the boxes in question, its liability cannot exceed the amount which it had reason to suppose the contents of the box to be worth."
And also that, "if you believe from the evidence that the plaintiff did inform the defendant that said boxes contained whisky, but did not inform the defendant that they contained any other valuable articles, and that the defendant did not have reason to suppose that they contained other valuable articles, then, even if you find the defendant was negligent, nevertheless, its liability cannot exceed the value of the whisky which was stipulated to be $400."
For the foregoing reasons, the judgment is affirmed.
We concur: FINCH, P. J.; PLUMMER, J.