B-130525, JUL. 3, 1958

B-130525, JUL. 3, 1958

TO A. B. JAMES FREIGHT LINES:

WE HAVE CONSIDERED YOUR LETTER OF MAY 21, 1957, FILE N-706/52, SEEKING REVIEW OF OUR AUDIT ACTION WHICH RESULTED IN DEDUCTIONS OF $41.97 AND $65.94, TO ACCOUNT FOR OVERPAYMENTS ON BILLS OF LADING N 30484470 AND N- 17983371, WHICH COVERED SHIPMENTS OF MISCELLANEOUS FREIGHT FROM NORTH ISLAND AND SAN DIEGO, CALIFORNIA, TO ALAMEDA AND EL CENTRO, CALIFORNIA, IN DECEMBER 1951 AND JANUARY 1952.

YOU OBJECT TO THE AUDIT ACTION ON THE GROUND THAT THE EXCLUSIVE USE RULE, RULE 110 OF SOUTHWESTERN MOTOR TARIFF BUREAU, U.S. GOVERNMENT QUOTATION NO. 1, SHOULD BE APPLIED, SINCE EACH BILL OF LADING WAS ANNOTATED TO SHOW THAT A CERTAIN TYPE OF EQUIPMENT WAS ORDERED AND FURNISHED. BILL OF LADING N-30484470 WAS ENDORSED "1 SET OF DOUBLES ORDERED AND FURNISHED; " YOU ASSERT THAT YOU FURNISHED A 44-FOOT SET OF DOUBLES, BUT THE NAVAL ACTIVITY WHICH SHIPPED THE GOODS HAS REPORTED THAT A 35-FOOT TRACTOR- TRAILER WAS FURNISHED AND WAS LOADED TO FULL VISIBLE CAPACITY. BILL OF LADING N-17983371 WAS ENDORSED "TYPE OF EQUIPMENT ORDERED-2 40 FEET FLAT RACKS TYPE OF EQUIPMENT FURNISHED-2 40 FEET FLAT RACKS.' OUR RECORD DOES NOT ESTABLISH WHETHER OR NOT THESE VEHICLES WERE LOADED TO FULL VISIBLE CAPACITY. APPARENTLY IT IS YOUR POSITION THAT THE MERE FACT OF EQUIPMENT- ORDERING BY THE SHIPPER, COUPLED WITH A BILL OF LADING NOTATION THEREOF, IS SUFFICIENT TO CONSTITUTE A DEMAND FOR EXCLUSIVE USE WITHIN THE INTENDMENT OF RULE 110.

RULE 110 ESTABLISHES THE BASIS FOR DETERMINING THE ASSESSABLE CHARGES IN INSTANCES WHERE THE ,EXCLUSIVE USE OF CARRIER'S EQUIPMENT IS REQUIRED OR DEMANDED BY THE SHIPPER TO MEET THE NEEDS OF SPECIAL CONDITIONS * * *.' THE PLAIN MEANING OF THESE WORDS IS SUCH THAT SOMETHING MORE THAN AN ORDER FOR A VEHICLE OR VEHICLES IS NECESSARY FROM THE SHIPPER IN ORDER TO INSURE THAT HIS GOODS WILL BE ACCORDED THE TYPE OF SERVICE CONTEMPLATED BY THE EXCLUSIVE USE RULE. THERE MUST BE A SPECIFIC DEMAND FOR THE EXCLUSIVE USE OF THE EQUIPMENT, OR THERE MUST BE A SPECIFIC REQUIREMENT WHICH CAN BE MET ONLY BY ACCORDING THE SHIPMENT THE EXCLUSIVE USE OF THE EQUIPMENT. THIS CONNECTION, SEE OUR DECISION TO YOU ON AUGUST 7, 1957, B-131798, IN CONNECTION WITH YOUR BILL N-705, AND THE CASES THERE CITED. AS TO THESE SHIPMENTS, THE RESPONSIBLE ADMINISTRATIVE AGENCY HAS REPORTED TO US THAT EXCLUSIVE USE OF THE VEHICLES ORDERED WAS NEITHER REQUIRED NOR DEMANDED. IN THESE CIRCUMSTANCES THERE IS NO JUSTIFICATION FOR A REVISION OF THE AUDIT ACTION AND IT IS SUSTAINED.

YOUR LETTER OF MAY 23, 1957, FILE N-807/53, RAISES THE EXCLUSIVE USE ISSUE WITH RESPECT TO THE AUDIT ACTION ON YOUR BILL N-807. OUR TRANSPORTATION DIVISION HAS BEEN INSTRUCTED TO REVIEW THIS ACTION TO INSURE THAT IT IS CONSISTENT WITH THE INTERPRETATION OF RULE 110 EXPRESSED HEREIN AND IN OUR DECISION B-131798. SHOULD ANY REVISION OF THAT AUDIT ACTION BE NECESSARY, YOU WILL BE ADVISED.