Request for Review of Deduction Action

A firm requested a review of a deduction action taken by the General Services Administration (GSA) for an alleged overcharge in connection with a shipment moving under a Government bill of lading (GBL). Exclusive vehicle service was requested by the Government and furnished by the carrier. The requester originally billed and was paid transportation charges on the basis of tariff rates. The GSA audit action was based on lower rates than in the requester's tender. It was the requester's position that the tender was not applicable because it required the shipper to seal the vehicle as a condition of applicability, and the shipper undisputedly did not perform this function. However, GSA contended that, under the tender, the application of seals to the carrier's vehicle by the shipper was optional, not mandatory, and therefore the lower tender rates were applicable to this shipment. In the GAO view, one item in the tender was intended to apply where the shipper, the Government, sealed the vehicle, performed the load and count of freight, and applied the numbered seal. Thus, in exchange for reduced tender rates, the carrier was relieved of loading and unloading the shipment, of the duty to count the freight, and of the need to inspect the shipment as a means of protecting itself from potential loss and damage liability. With respect to establishing the carrier's liability for loss and damage, shipper load and count place the burden of proof on the shipper regarding the number and condition of the shipment when accepted by the carrier. On the other hand, the exclusive-use item offered the shipper additional rights when requesting exclusive use; that is, the option to seal the vehicle with specific instructions consistent with maintaining the integrity of the seal to ensure the performance of the exclusive-use service. In view of the language and purpose of the first item, GAO could not accept the theory of GSA that the exclusive-use item, which was usually requested as an additional security measure, was intended as an exception to the general tender requirement for seals which also concerned security and protection of the shipment. Accordingly, GAO reversed the GSA audit action.