B-135607, OCT. 14, 1963
Highlights
FURTHER DEMAND WAS MADE FOR PAYMENT OF OUR CLAIM FOR $1. SINCE THAT TIME WE HAVE BEEN INFORMED OF YOUR POSITION THAT OUR FAILURE TO TIMELY NOTIFY INSURERS POTENTIALLY LIABLE UNDER INTERSTATE COMMERCE COMMISSION FORM BMC 32 ENDORSEMENTS FOR LOSS AND DAMAGE CLAIMS PENDING HERE AGAINST COMMON CARRIERS OF PROPERTY BY MOTOR VEHICLE HAS RESULTED IN PREJUDICE TO THE RIGHTS OF YOUR CLIENTS. SUCH AGENCIES DETERMINE THAT GIVEN CLAIMS ARE ADMINISTRATIVELY UNCOLLECTIBLE. THE CLAIMS ARE REQUIRED TO BE FORWARDED HERE FOR DIRECT SETTLEMENT. IT WAS OUR VIEW THAT THE INSURERS OUGHT NOT TO BE FORCED TO CONSIDERATION OF THESE CLAIMS UNLESS IT APPEARED THAT COLLECTION FROM THE CARRIERS CONCERNED WAS NOT REASONABLY POSSIBLE.
B-135607, OCT. 14, 1963
TO SCHINDEL AND COOPER:
BY LETTER OF JUNE 21, 1963, FURTHER DEMAND WAS MADE FOR PAYMENT OF OUR CLAIM FOR $1,692.24 AGAINST THE RED TOP TRANSFER COMPANY, INC., AND YOUR CLIENT, THE UNITED STATES FIRE INSURANCE COMPANY, A/C APPLETON AND COX, INC. SINCE THAT TIME WE HAVE BEEN INFORMED OF YOUR POSITION THAT OUR FAILURE TO TIMELY NOTIFY INSURERS POTENTIALLY LIABLE UNDER INTERSTATE COMMERCE COMMISSION FORM BMC 32 ENDORSEMENTS FOR LOSS AND DAMAGE CLAIMS PENDING HERE AGAINST COMMON CARRIERS OF PROPERTY BY MOTOR VEHICLE HAS RESULTED IN PREJUDICE TO THE RIGHTS OF YOUR CLIENTS.
THE INITIAL RESPONSIBILITY FOR COLLECTION OF LOSS AND DAMAGE CLAIMS AGAINST THESE CARRIERS RESTS WITH THE ADMINISTRATIVE AGENCIES MAKING THE SHIPMENTS GIVING RISE TO THE CLAIMS. WHEN, HOWEVER, SUCH AGENCIES DETERMINE THAT GIVEN CLAIMS ARE ADMINISTRATIVELY UNCOLLECTIBLE, OR THAT SUCH CLAIMS POSE DOUBTFUL QUESTIONS OF FACT OR LAW, THE CLAIMS ARE REQUIRED TO BE FORWARDED HERE FOR DIRECT SETTLEMENT. IT HAS BEEN OUR PRACTICE TO EXHAUST ALL AVAILABLE MEANS FOR COLLECTING THESE CLAIMS FROM THE CARRIERS RESPONSIBLE FOR THE LOSS OR DAMAGE BEFORE MAKING DEMAND UPON THE INSURERS AS A LAST RESORT. IT WAS OUR VIEW THAT THE INSURERS OUGHT NOT TO BE FORCED TO CONSIDERATION OF THESE CLAIMS UNLESS IT APPEARED THAT COLLECTION FROM THE CARRIERS CONCERNED WAS NOT REASONABLY POSSIBLE. THIS PRACTICE SOMETIMES HAS RESULTED IN A LENGTHY POSTPONEMENT OF NOTICE OF UNSATISFIED LIABILITY TO THE INSURERS CONCERNED.
IN ORDER TO ALLEVIATE THIS SITUATION, OUR TRANSPORTATION DIVISION HAS ISSUED INSTRUCTIONS REQUIRING THAT IF ITS OPERATIONS BRANCH HAS BEEN UNABLE TO EFFECT COLLECTION OF A LOSS AND DAMAGE DEBT BY REFUND OR SETOFF WITHIN A REASONABLE TIME (IN NO INSTANCE LATER THAN ONE YEAR FROM THE DATE OF RECEIPT OF THE CLAIM IN THE GENERAL ACCOUNTING OFFICE) IT WILL REFER THE CLAIM TO THE REPORTS BRANCH OF THE DIVISION. THE INSTRUCTIONS FURTHER PROVIDE THAT THE REPORTS BRANCH, WHEN IT SENDS A DEMAND LETTER TO THE CARRIER, WILL CONCURRENTLY SEND A COPY OF SUCH LETTER TO THE INSURER OR INSURERS WHO MIGHT BE INVOLVED. IT IS HOPED THAT AS TO FUTURE CASES THIS PROCEDURE WILL REMOVE THE OBJECTION OF UNDUE DELAY IN NOTIFYING THE INSURER OF THE INSURED'S PRIMARY RESPONSIBILITY FOR ADJUSTING THE LOSS OR DAMAGE CLAIM. IF YOU HAVE ANY SUGGESTIONS FOR ANY FURTHER ACTION BY OUR OFFICE, WE WILL BE GLAD TO CONSIDER THEM.
THE RED TOP TRANSFER MATTER IS BELIEVED TO BE AN UNUSUAL ONE, IN POINT OF TIME INVOLVED, AMONG THE MANY CLAIMS FOR WHICH OUR OFFICE HAS COLLECTION RESPONSIBILITY. IT IS NOTED AGAIN THAT A JUDGMENT OF $5,230.07, INCLUDING AN ALLOWANCE OF $1,692.24 FOR THE DAMAGE HERE CONCERNED, WAS OBTAINED AGAINST THE CARRIER IN A CONTESTED COURT ACTION BROUGHT BY THE UNITED STATES. NOTWITHSTANDING THE DELAY IN NOTIFYING THE INSURANCE COMPANY IN THIS INSTANCE, WE ARE OBLIGED TO SEEK ENFORCEMENT OF THE UNCONDITIONAL AND ABSOLUTE PROMISE IN THE FORM BMC 32 ENDORSEMENT OF THE UNITED STATES FIRE INSURANCE COMPANY TO PAY FOR LOSS AND DAMAGE WITHIN ITS TERMS.
YOUR FURTHER CONSIDERATION OF OUR CLAIM AGAINST RED TOP TRANSFER, INC., WILL BE APPRECIATED AND PAYMENT OF SUCH AMOUNT AS THE CARGO INSURER IS LIABLE FOR UNDER THE FORM BMC 32 ENDORSEMENT IS REQUESTED.