B-143048, SEP. 1, 1960

B-143048, SEP. 1, 1960

TO BRYCE REA, JR., ESQUIRE:

WE HAVE REVIEWED THE RECORD OF THE SETTLEMENT ISSUED IN CLAIM TK 689747, AS REQUESTED IN YOUR LETTER OF MAY 27, 1960, WRITTEN ON BEHALF OF THE CLAIMANT, COOPER-JARRETT, INC.

THE RECORD SHOWS THAT BILLS OF LADING AF-5072627 AND AF-5072670, ISSUED IN DECEMBER 1955, COVERED TWO SHIPMENTS OF HOUSEHOLD GOODS FROM SPOKANE, WASHINGTON, FOR EXPORT THROUGH THE BROOKLYN ARMY TERMINAL, NEW YORK PORT OF EMBARKATION, TENDERED AT ORIGIN TO UNITED TRUCK LINES, INC., AND ROUTED "UTL OR NECESSARY (CONNECTIONS).' THE RECORD DOES NOT SHOW THE ACTUAL ROUTE OF MOVEMENT; THE SHIPMENTS, HOWEVER, WERE DELIVERED BY COOPER- JARRETT, INC., WHICH SUBMITTED ITS BILL NO. 1714 TO COLLECT CHARGES COMPUTED AT A RATE OF $10.69 PER HUNDRED POUNDS. WHEN THE PAID BILL WAS AUDITED IN OUR TRANSPORTATION DIVISION, IT WAS DETERMINED THAT THE INITIAL CARRIER SHOULD HAVE FORWARDED THE GOODS VIA A ROUTE OVER WHICH APPLIED A RATE OF $7.65 PER HUNDRED POUNDS, PROVIDED IN ITEM 6980, ROCKY MOUNTAIN MOTOR TARIFF BUREAU U.S. GOVERNMENT QUOTATION NO. 43-D, AND COOPER- JARRETT, INC., WAS ASKED TO REFUND THE OVERCHARGE, WHICH TOTALED $130.30. UPON ITS FAILURE TO DO SO, THE AMOUNT WAS ADMINISTRATIVELY DEDUCTED, PURSUANT TO 49 U.S.C. 66, WHEREUPON A CLAIM FOR THE DEDUCTION WAS PRESENTED ON BEHALF OF COOPER-JARRETT, INC., INDICATING THAT THE OVERCHARGE WAS BASED UPON THE UNREASONABLENESS OF THE CHARGES ORIGINALLY PAID AND THAT, THEREFORE, UNDER THE RULE EXPOUNDED IN DAVIDSON TRANSFER AND STORAGE, INC. V. UNITED STATES, 359 U.S. 464, THE DEDUCTION WAS WRONGFULLY MADE. THIS CLAIM WAS DISALLOWED ON THE GROUND THAT IT WAS THE DUTY OF THE INITIAL CARRIER TO FORWARD THESHIPMENTS VIA THE CHEAPEST AVAILABLE ROUTE AND THAT, SINCE REASONABLENESS WAS NOT IN ISSUE, THE DAVIDSON CASE WAS NOT CONTROLLING.

IN YOUR LETTER OF MAY 27, YOU VIEW THE GOVERNMENT'S POSITION AS BEING THAT THE CHARGES CORRECTLY COMPUTED AT RATES APPLICABLE VIA THE ACTUAL ROUTE OF MOVEMENT ARE UNREASONABLE AND SUBJECT TO RECOUPMENT TO THE EXTENT THAT THEY EXCEED CHARGES COMPUTED AT RATES APPLICABLE VIA OTHER AVAILABLE ROUTES. THIS IS NOT THE GOVERNMENT'S POSITION. YOU SAY THAT OUR OFFICE "HAS UNTIL NOW AGREED WITH" YOUR VIEW THAT THE HOLDING IN THE DAVIDSON CASE GOVERNED THIS TYPE OF SITUATION; THAT WE REFUNDED SIMILAR DEDUCTIONS ON WHICH SUIT HAD BEEN BROUGHT IN HORN'S MOTOR EXPRESS, INC., ET AL. V. UNITED STATES, IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND, CIVIL ACTION NO. 10323; AND THAT YOU THEN DISMISSED THIS SUIT ON THE UNDERSTANDING THAT OUR OFFICE WOULD CONTINUE TO CONSIDER THE DAVIDSON CASE AS CONTROLLING. YOU CONCLUDE THAT UNLESS THE SETTLEMENT DISALLOWING CLAIM TK-689747, ISSUED MAY 23, 1960, APPROXIMATELY A MONTH AFTER THE DISMISSAL OF CIVIL ACTION NO. 10323 ON APRIL 18, WAS A COINCIDENCE, IT IS "AN UNSEEMLY BREACH OF FAITH BENEATH THE DIGNITY OF THE UNITED STATES.'

WE DO NOT UNDERSTAND THAT THERE HAS BEEN A BREACH OF FAITH IN THIS MATTER. THE SETTLEMENT AND DISMISSAL OF THE PENDING SUIT PRIOR TO TRIAL BY NEGOTIATION BETWEEN YOU AND THE DEPARTMENT OF JUSTICE WERE NOT, SO FAR AS OUR RECORDS DISCLOSE, CONDITIONED ON ANY AGREEMENT OR UNDERSTANDING THAT THE ISSUE WOULD NEVER THEREAFTER BE RAISED IN OUR AUDIT AND CLAIMS SETTLEMENT FUNCTIONS OR BY THE GOVERNMENT IN ANOTHER SUIT ON OTHER TRANSACTIONS. OUR CONCURRENCE IN THE ADMINISTRATIVE SETTLEMENT HANDLING OF THE ITEMS IN THE HORN'S MOTOR EXPRESS CASE DID NOT CONTEMPLATE SUCH AN AGREEMENT, THE PROPRIETY OF WHICH WOULD BE QUESTIONABLE IN ANY EVENT. WE, THEREFORE, DO NOT RECOGNIZE THE EXISTENCE OF ANY COMMITMENT TO ADHERE TO ANY PARTICULAR POSITION ON THE MISROUTE ISSUE AND WE FEEL THAT THE ARRANGEMENT FOR SETTLEMENT OF THE HORN'S MOTOR EXPRESS CASE WITHOUT TRIAL WAS BINDING AS TO THAT SUIT ONLY AND CANNOT OPERATE TO PRECLUDE THE UNITED STATES FROM DEFENDING ON THE SAME ISSUE IN ANOTHER SUIT OR TO PREJUDICE THE GENERAL ACCOUNTING OFFICE IN ITS SETTLEMENT OF OTHER CLAIMS RAISING THE SAME ISSUE. OUR REJECTION OF THE SUBJECT COOPER-JARRETT CLAIM WAS NOT PURPOSELY DELAYED UNTIL ISSUANCE OF THE ORDER OF SATISFACTION IN THE HORN'S MOTOR EXPRESS CASE, THE CLAIMS IN WHICH, IT SHOULD BE NOTED, WERE AUTHORIZED FOR PAYMENT BY OUR OFFICE IN EARLY NOVEMBER 1959. IT SHOULD BE NOTED, ALSO, THAT THE MISROUTE ISSUE IS PRESENTLY INVOLVED IN RISS AND CO. V. UNITED STATES, CT.CL. 326-59, AND IN HEWITT-ROBINS, INC. V. EASTERN FREIGHT WAYS, INC., CIVIL NO. 107-319, PENDING IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK.

WE RECOGNIZE, WHERE APPLICABLE, THE BINDING EFFECT OF THE PRINCIPLE ESTABLISHED IN THE DAVIDSON CASE THAT, SINCE THE PASSAGE OF THE MOTOR CARRIER ACT, SHIPPERS BY MOTOR COMMON CARRIER POSSESS NO JUDICIALLY COGNIZABLE RIGHT TO DAMAGES FOR THE EXACTION OF UNREASONABLE BUT LEGALLY APPLICABLE MOTOR COMMON CARRIER RATES AND CHARGES. THE DAVIDSON CASE, HOWEVER, MUST BE LIMITED TO ITS OWN PECULIAR FACTS; ITS SWEEP IS NOT COEXTENSIVE WITH THE MOTOR CARRIER ACT. WE VIEW THE PRINCIPLE OF THAT CASE AS UNRELATED TO, AND AS NOT GOVERNING A SITUATION SUCH AS THAT PRESENTED HERE, WHERE THE ISSUE RAISED DOES NOT PUT IN QUESTION THE INTRINSIC REASONABLENESS OF THE TWO RATES INVOLVED, BUT ONLY WHICH OF THE TWO SHOULD HAVE BEEN CHARGED: THE HIGHER RATE APPLICABLE VIA A ROUTE NOT IDENTIFIED IN THE RECORD BUT ALLEGED TO BE THE ROUTE THE SHIPMENTS TRAVELED, OR THE LOWER JOINT RATE APPLICABLE VIA A THROUGH ROUTE CONFORMING TO THE BILL OF LADING INSTRUCTIONS.

THE RECORD IN THIS CASE SHOWS THAT THE SHIPMENTS WERE TENDERED ORIGINALLY TO THE UNITED TRUCK LINES, INC., WHICH HELD ITSELF OUT, IN ITEM 6980 OF QUOTATION NO. 43-D, AS A PARTICIPANT WITH OTHER CARRIERS IN A THROUGH ROUTE FOR THE TRANSPORTATION OF HOUSEHOLD GOODS FROM SPOKANE, WASHINGTON, TO THE NEW YORK PORT OF EMBARKATION AT A RATE OF $7.65 PER HUNDRED POUNDS. THIS HOLDING OUT BECAME PART OF THE CARRIER'S UNDERTAKING WHEN IT ACCEPTED THE GOODS FOR TRANSPORTATION. WHETHER THE UNITED TRUCK LINES BREACHED THIS UNDERTAKING BY FAILING TO FORWARD THE GOODS OVER THE ROUTE PROVIDED IN CONNECTION WITH THE $7.65 RATE, OR WHETHER THE BREACH WAS EFFECTED BY THE FAILURE OF A CONNECTING CARRIER TO FORWARD OVER THIS ROUTE, IS IMMATERIAL. IN ANY EVENT, THE GOVERNMENT IS NOT LIABLE FOR CHARGES IN EXCESS OF THOSE BASED UPON THE $7.65 RATE APPLICABLE VIA THE ROUTE WHICH THE UNITED TRUCK LINES WAS OBLIGATED TO OBSERVE IN FORWARDING THE GOODS BEYOND ITS OWN LINE.

ACCORDINGLY, THE SETTLEMENT ISSUED IN CLAIM TK-689747 WAS CORRECT AND IT IS SUSTAINED.