Maryland Casualty Co. v. Southern Pac. Co.

In December, 1932, the Pioneer Truck & Transfer Company of Los Angeles, the Pioneer Truck Company of Los Angeles, and California Truck Company, Inc., as principals, and the defendant Maryland Casualty Company, as surety, executed and delivered to the plaintiffs Southern Pacific Company, Union Pacific Railroad Company and the Atchison, Topeka and Santa Fe Railway Company their joint and several bond in the sum of $15,000, guaranteeing transportation charges. This bond was in effect at all times material to the issues of this case.

For convenience we shall hereinafter refer to the principals on said bond as Truck Companies, to the surety as Surety, and to the plaintiffs as Railway Companies.

The bond contained the following provision:

Between December 1 and December 15, 1937, the Railway Companies delivered to the Truck Companies “collect” shipments of merchandise upon which the transportation charges had not been paid. In this manner the Truck Companies became indebted to the Railway Companies [the aggregate owed to the three companies] in the sum of $71,460.21. On December 24, 1937, the Track Companies were adjudicated bankrupt by the order of the United States District Court.…