B-138622, DEC. 16, 1959

B-138622, DEC. 16, 1959

TO NAVAJO FREIGHT LINES, INC.:

REFERENCE IS MADE TO YOUR LETTER OF SEPTEMBER 4, 1959, REQUESTING RECONSIDERATION OF OUR DECISION DATED AUGUST 13, 1959, B-138622, SUSTAINING THE USE OF THE $3.43 RATE PUBLISHED IN ROCKY MOUNTAIN MOTOR TARIFF BUREAU, INC. U.S. GOVERNMENT QUOTATION NO. 43-D, 2ND REVISED PAGE 78-B, EFFECTIVE DECEMBER 27, 1955, IN THE AUDIT OF YOUR BILL NO. 277-4236- A, COVERING SHIPMENTS OF AMMUNITION FOR CANNON WITH EXPLOSIVE PROJECTILES MOVING FROM SAVANNA, OKLAHOMA, TO HAWTHORNE, NEVADA, IN MARCH 1956.

IN OUR DECISION OF AUGUST 13, 1959, THE FACTS AND CIRCUMSTANCES GIVING RISE TO YOUR CLAIM, AS WELL AS THE BASIS FOR OUR ACTION WERE SET FORTH IN DETAIL. IT WAS HELD THAT WHEN A BIDDER HAS MADE A MISTAKE IN THE SUBMISSION OF A BID, AND THE BID HAS BEEN ACCEPTED, HE MUST BEAR THE CONSEQUENCES THEREOF, UNLESS THE MISTAKE WAS MUTUAL OR THE ERROR WAS SO APPARENT THAT IT MUST BE PRESUMED THE CONTRACTING OFFICER KNEW OF THE MISTAKE AND SOUGHT TO TAKE ADVANTAGE THEREOF, AND THAT NO EVIDENCE OF MUTUAL MISTAKE--- NOT UNILATERAL--- HAD BEEN PRESENTED WHICH WOULD AFFORD THE ONLY LEGAL JUSTIFICATION FOR THE MODIFICATION OR REVISION OF AN OTHERWISE VALID CONTRACT.

IN YOUR REQUEST FOR RECONSIDERATION OF THE MATTER, YOU URGE THAT THE PRINCIPLES OF CONTRACT LAW ARE NOT APPLICABLE IN THIS CASE BECAUSE THE RATE PUBLICATION HERE INVOLVED--- ROCKY MOUNTAIN MOTOR TARIFF BUREAU, INC. U.S. GOVERNMENT QUOTATION NO. 43-D--- "WAS IN NO SENSE A CONTRACT BETWEEN THE UNITED STATES AND THE CARRIERS PARTICIPATING IN THAT PUBLICATION.'

THE DECISION OF AUGUST 13, 1959, WAS NOT INTENDED TO IMPLY THAT THE RATE PUBLICATION ITSELF WAS A CONTRACT, BUT RATHER THAT SUCH PUBLICATION CONSISTED OF A SERIES OF CONTINUING UNILATERAL OFFERS WHICH ARE ACCEPTED BY THE GOVERNMENT FOR EACH PARTICULAR SHIPMENT UPON TENDER OF THAT SHIPMENT--- THE BILL OF LADING CONSTITUTING THE CONTRACT BETWEEN THE PARTIES. SEE LOUISVILLE AND NASHVILLE RAILROAD CO. V. UNITED STATES, 106 F.SUPP. 999, AFFIRMED 221 F.2D 698, WHEREIN IT WAS HELD THAT A SECTION 22 QUOTATION WAS, IN EFFECT, AN IMPLIED CONTRACT WHEN ACCEPTED BY THE GOVERNMENT BY TENDER OF SHIPMENTS THEREUNDER. YOUR PRESENT OBJECTIONS APPEAR TO BE SQUARELY MET IN THE DECISION OF AUGUST 13, 1959, WHEREIN IT WAS STATED, IN PERTINENT PART, AS FOLLOWS:

"ROCKY MOUNTAIN MOTOR TARIFF BUREAU, INC., U.S. GOVERNMENT QUOTATION NO. 43-D, WHICH WAS VOLUNTARILY PROMULGATED PURSUANT TO SECTION 22 OF THE INTERSTATE COMMERCE ACT, 49 U.S.C.A. 22, CONSISTS OF A SERIES OF CONTINUING UNILATERAL OFFERS BY ITS PARTICIPANTS TO TRANSPORT FREIGHT FOR THE UNITED STATES, ON AND AFTER SPECIFIED DATES, AT RATES AND CHARGES NAMED THEREIN. ITEM 600 ON 2ND REVISED PAGE 78-B, OFFERED, ON AND AFTER DECEMBER 27, 1955, A RATE OF $3.43 PER 100 POUNDS, SUBJECT TO 30,000 POUNDS VOLUME MINIMUM WEIGHTS, FOR THE CARRIAGE OF AMMUNITION AND/OR EXPLOSIVES AND/OR FIREWORKS, BETWEEN THE NAVAL AMMUNITION DEPOT, MCALESTER (SAVANNA, HAYWOOD), OKLAHOMA, AND THE NAVAL AMMUNITION DEPOT, HAWTHORNE, NEVADA. THE GOVERNMENT'S TENDER AT MCALESTER (SAVANNA), OKLAHOMA, ON MARCH 13, 14 AND 16, 1956, OF SIX SHIPMENTS OF AMMUNITION FOR CANNON WITH EXPLOSIVE PROJECTILES--- WEIGHING IN EXCESS OF 30,000 POUNDS EACH--- FOR TRANSPORTATION TO HAWTHORNE, NEVADA, OPERATED AS ACCEPTANCE OF THIS OFFER. THE CARRIER'S UNDERTAKING, PURSUANT TO THE TERMS OF THE BILL OF LADING CONTRACT, WAS FULLY EXECUTED WHEN THE SHIPMENTS WERE DELIVERED AT HAWTHORNE ON MARCH 09, 20 AND 27, 1956, AT WHICH TIME YOU WERE ENTITLED TO, CLAIMED, AND DID COLLECT, CHARGES IN ACCORDANCE WITH THE OFFER HELD OUT IN ITEM 600 ON 2ND REVISED PAGE 78-B, EFFECTIVE DECEMBER 27, 1955.'

AS TO THE OTHER POINTS MENTIONED IN YOUR LETTERS, AT THE TIME THE SHIPMENTS WERE MADE, SECTION 22 OF THE INTERSTATE COMMERCE ACT WAS SILENT AS TO THE FORMAT OF OFFERS MADE THEREUNDER. CONSEQUENTLY, THE OMISSION OF THE STANDARD REFERENCE MARK DENOTING A REDUCTION, WHICH IS REQUIRED TO BE SHOWN IN CONNECTION WITH THE REDUCTION OF RATES IN DULY PUBLISHED AND FILED TARIFFS, IS OF NO SIGNIFICANCE. ALSO, SECTION 22 OF THE ACT (49 U.S.C. 22) PROVIDED "NOTHING IN THIS CHAPTER SHALL PREVENT THE STORAGE, OR HANDLING OF PROPERTY FREE OR AT REDUCED RATES FOR THE UNITED TES.' NOTHING THEREIN WOULD HAVE OPERATED TO PREVENT A RETROACTIVE REDUCTION IN RATE OFFERS TENDERED TO THE GOVERNMENT. HOWEVER, RETROACTIVE INCREASES, AS INDICATED IN OUR PRIOR DECISION TO YOU MAY NOT BE RECOGNIZED SINCE GOVERNMENT OFFICERS ARE WITHOUT AUTHORITY TO CHANGE OR MODIFY EXISTING CONTRACTS SO AS TO INCREASE THE GOVERNMENT'S LIABILITY WITHOUT A CORRESPONDING BENEFIT TO THE UNITED STATES. THE FACT THAT, SUBSEQUENT TO THE DATE OF THE SHIPMENT, THE NAVY DEPARTMENT WAS NOTIFIED OF THE UNILATERAL ERROR IN PUBLISHING THE RATE AND FILED THE PAGE PURPORTING TO INCREASE RETROACTIVELY THE RATE THUS IS WITHOUT LEGAL SIGNIFICANCE SO FAR AS CONCERNS THE RATES REQUIRED TO BE APPLIED AS TO INVOLVED SHIPMENT.

THE CONTENTS OF YOUR LETTER OF SEPTEMBER 4, 1959, HAVE BEEN CAREFULLY CONSIDERED BUT SUCH LETTER AFFORDS NO PROPER BASIS TO MODIFY THE CONCLUSIONS PREVIOUSLY REACHED IN THIS MATTER, AND THE OVERPAYMENT OF $909.40 ON YOUR SUPPLEMENTAL BILL NO. 277-4236-A SHOULD BE REFUNDED PROMPTLY ..END :