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B-155377, DEC. 2, 1964

B-155377 Dec 02, 1964
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DAVIDSON'S FILE REFERENCES ARE OC 597-G. WERE TENDERED TO GENERAL EXPRESSWAYS (APPARENTLY OPERATED BY NAVAJO) ON GOVERNMENT BILLS OF LADING AT THE ROCK ISLAND ARSENAL. THE SHIPMENTS WERE DELIVERED AT ABERDEEN BY DAVIDSON IN DECEMBER 1962 AND APRIL AND MAY 1963. WHO IS INDICATED AS BEING THE CARRIERS' AGENT. THAT EXCLUSIVE USE OF VEHICLE SERVICE WAS FURNISHED FROM ORIGIN TO DESTINATION. - THE CERTIFICATE IS SIGNED BY THE SAME PERSON (A. THERE IS NO INDICATION OF THE BASIS FOR THE CERTIFICATION AS TO EXCLUSIVE -USE PERFORMANCE FROM ROCK ISLAND TO ABERDEEN. ALTHOUGH IT IS INDICATED ON ANOTHER BILL OF LADING. - WERE INTACT AT DESTINATION. THAT TRUCKLOAD RATES AND MINIMUM WEIGHTS WERE APPLICABLE AND THAT THE SHIPMENTS HAD BEEN OVERCHARGED $330.21.

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B-155377, DEC. 2, 1964

TO NAVAJO FREIGHT LINES, INC.:

IN YOUR LETTER OF OCTOBER 6, 1964 (WITH ENCLOSURES), YOU QUESTION THE PROPRIETY OF OVERCHARGES STATED BY OUR TRANSPORTATION DIVISION ON BILLS COVERING FREIGHT CHARGES PAID TO THE DAVIDSON TRANSFER AND STORAGE COMPANY ON THREE SHIPMENTS INTERLINED WITH YOUR COMPANY BUT DELIVERED AT DESTINATION BY DAVIDSON. DAVIDSON'S FILE REFERENCES ARE OC 597-G, 598-G, AND 603-G.

THE THREE SHIPMENTS REFERRED TO IN YOUR LETTER CONSISTED MOSTLY OF GUN MOUNTS, NOI. THEY WEIGHED 18,600 POUNDS, 9,421 POUNDS AND 20,366 POUNDS, AND WERE TENDERED TO GENERAL EXPRESSWAYS (APPARENTLY OPERATED BY NAVAJO) ON GOVERNMENT BILLS OF LADING AT THE ROCK ISLAND ARSENAL, ROCK ISLAND, ILLINOIS, FOR TRANSPORTATION TO ABERDEEN PROVING GROUNDS, MARYLAND. THE SHIPMENTS WERE DELIVERED AT ABERDEEN BY DAVIDSON IN DECEMBER 1962 AND APRIL AND MAY 1963. EACH BILL OF LADING CONTAINS A REQUEST BY AN EMPLOYEE AT THE ARSENAL FOR THE EXCLUSIVE USE OF A VEHICLE AND A CERTIFICATION BY A PERSON, WHO IS INDICATED AS BEING THE CARRIERS' AGENT, THAT EXCLUSIVE USE OF VEHICLE SERVICE WAS FURNISHED FROM ORIGIN TO DESTINATION. IN ONE INSTANCE--- BILL OF LADING C 2166111--- THE CERTIFICATE IS SIGNED BY THE SAME PERSON (A. D. CANNON, GENERAL AUDITOR FOR DAVIDSON) WHO SIGNED THE PAYEE'S CERTIFICATE ON DAVIDSON'S COVERING BILL NO. 50618.

THERE IS NO INDICATION OF THE BASIS FOR THE CERTIFICATION AS TO EXCLUSIVE -USE PERFORMANCE FROM ROCK ISLAND TO ABERDEEN, AND SOME QUESTION ARISES AS TO DAVIDSON'S KNOWLEDGE OF EXCLUSIVE-USE HANDLING FROM ORIGIN TO DESTINATION, SINCE IT APPARENTLY TRANSPORTED THE SHIPMENTS ONLY FROM BALTIMORE TO ABERDEEN, MARYLAND. EACH BILL OF LADING INDICATES THAT THE SHIPMENT DESCRIBED THEREON FULLY LOADED THE VEHICLE USED. ONLY ONE OF THE BILLS OF LADING, B-7155398, SHOWS A SEAL RECORD, ALTHOUGH IT IS INDICATED ON ANOTHER BILL OF LADING, C 2166111, THAT THE SEALS--- NO NUMBERS FURNISHED--- WERE INTACT AT DESTINATION.

DAVIDSON BILLED AND COLLECTED FREIGHT CHARGES OF $822.60 ON EACH SHIPMENT, AS FOR EXCLUSIVE USE OF VEHICLE SERVICE. DURING OUR AUDIT OF THE PAID BILLS, WE DETERMINED AND NOTIFIED DAVIDSON ON NOTICES OF OVERCHARGE (USGAO FORM 1003), THAT TRUCKLOAD RATES AND MINIMUM WEIGHTS WERE APPLICABLE AND THAT THE SHIPMENTS HAD BEEN OVERCHARGED $330.21, $348.80, AND $364.80. THE OVERCHARGES ARE BASED ON CURTIS LIGHTING, INC. V. MID-STATES FREIGHT LINES, INC., 303 I.C.C. 576 (1958), IN WHICH THE INTERSTATE COMMERCE COMMISSION HELD THAT ONCE A VEHICLE IS LOADED TO CAPACITY THE SHIPPER DERIVES NO BENEFIT FROM EXCLUSIVE USE, A PREMIUM SERVICE DESIGNED TO ACCORD TRUCKLOAD SERVICE TO LESS-THAN TRUCKLOAD SHIPMENTS.

AS THE INTERLINING OR CONNECTING CARRIER ON THESE THREE SHIPMENTS, YOU STATE THAT YOU WILL BE RESPONSIBLE FOR 80 PERCENT OF THE AMOUNT OF EACH OVERCHARGE; BECAUSE OF THAT SITUATION YOU ASK THAT WE WITHDRAW THE OVERCHARGES CLAIMS STATED AGAINST DAVIDSON. WHILE YOU ARE AWARE THAT THE QUESTION OF THE PROPRIETY OF EXCLUSIVE USE CHARGES ON SHIPMENTS MOVING IN FULLY LOADED TRAILERS IS NOW BEING LITIGATED IN GARRETT FREIGHT LINES, INC. V. UNITED STATES, NOW PENDING IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF IDAHO, EASTERN DIVISION, NO. 2297, YOU URGE THE CLAIMS AGAINST DAVIDSON BE WITHDRAWN. YOUR POSITION IS THAT WITHDRAWAL IS REQUIRED BECAUSE THE GOVERNMENT'S RELIANCE ON THE CURTIS LIGHTING CASE HAS BEEN REJECTED AS A DEFENSE IN CAMPBELL "66" EXPRESS, INC. V. UNITED STATES, 302 F.2D 270 (1962); NAVAJO FREIGHT LINES, INC. V. UNITED STATES, UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO, CIVIL ACTION NO. 6753, DECIDED AUGUST 17, 1962; AND NAVAJO FREIGHT LINES, INC. V. UNITED STATES, UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW MEXICO, CIVIL ACTION NO. 5147, DECIDED SEPTEMBER 19, 1963. ALSO, YOU SAY THAT SOME OVERCHARGE CLAIMS AGAINST YOUR COMPANY ON OTHER SHIPMENTS, WHICH ALLEGEDLY ARE SIMILAR TO THESE SHIPMENTS, HAVE BEEN WITHDRAWN BY OUR TRANSPORTATION DIVISION. YOU SUGGEST THAT WE HOLD IN ABEYANCE ANY OVERCHARGE CLAIMS INVOLVING THE CURTIS LIGHTING CASE PRINCIPLE, PENDING THE FINAL JUDICIAL RESOLUTION OF THE ISSUE.

BECAUSE THE PROPRIETY OF PAYING EXCLUSIVE USE CHARGES ON SHIPMENTS MOVING IN FULLY LOADED TRAILERS IS AN ISSUE NOW BEING LITIGATED IN THE GARRETT FREIGHT LINES SUIT, AND CONSISTENT WITH OUR STATUTORY DUTIES TO SETTLE AND ADJUST CLAIMS BY AND AGAINST THE UNITED STATES,WE WOULD NOT BE JUSTIFIED, ON THE BASIS URGED BY YOU, IN POSTPONING ADJUSTMENT OF OVERCHARGE CLAIMS SUCH AS THE ONES NOW IN DISPUTE. IT MAY BE THAT SOME OVERCHARGE CLAIMS STATED AGAINST NAVAJO, SUPERFICIALLY SIMILAR TO THOSE HERE INVOLVED, HAVE BEEN WITHDRAWN BY OUR TRANSPORTATION DIVISION. POSSIBLY HOWEVER, THERE ARE MATERIAL POINTS OF DIFFERENCE WHICH JUSTIFIED FINAL HANDLING FAVORABLE TO THE CARRIER.

DIFFERENCES IN THE FACTS OF EXCLUSIVE-USE CASES REQUIRE THAT EACH OF THEM BE CONSIDERED ON THE BASIS OF THE RECORD PERTAINING TO THE PARTICULAR TRANSACTION INVOLVED. OUR OFFICE HAS BEEN CONSISTENT IN REINSTATING ALLOWANCES OF EXCLUSIVE-USE CHARGES IN THOSE INSTANCES WHERE THE ARTICLES TRANSPORTED DID NOT FULLY LOAD THE VEHICLE USED SO THAT NO MORE OF THE SAME ARTICLE COULD HAVE BEEN LOADED ON THAT VEHICLE. IN OTHER WORDS, IF OTHERWISE PROPER, WE ARE LIMITING THE APPLICATION OF THE CURTIS LIGHTING CASE PRINCIPLE TO THOSE INSTANCES WHERE THE VEHICLE USED IS A CAPACITY LOAD AND NO OTHER ARTICLE OF THE SAME NATURE IN THE SHIPPING FORM TENDERED COULD BE LOADED ON THAT VEHICLE. THIS MIGHT EXPLAIN SOME OF THE WITHDRAWALS OF PAST OVERCHARGE CLAIMS.

OUR TRANSPORTATION DIVISION IS CONTINUING TO DEVELOP THE RECORD FURTHER IN CONNECTION WITH THE PRESENT THREE SHIPMENTS IN ORDER TO AGAIN CONFIRM ITS DETERMINATION THAT THE CHARGES PROPERLY ALLOWABLE ARE THOSE DERIVED FROM ITEM 4110 OF EASTERN CENTRAL MOTOR CARRIERS ASSOCIATION GOVERNMENT RATE TARIFF NO. 1. DAVIDSON WILL AGAIN BE CONTACTED BY OUR TRANSPORTATION DIVISION AS TO ITS LIABILITY FOR OVERCHARGES ON THE THREE SHIPMENTS.

SOME OF THE PROBLEMS THAT ARISE IN CONNECTION WITH SHIPMENTS DESIGNATED FOR EXCLUSIVE USE MAY BE CAUSED BY COMPLICATING REFERENCES IN THE PERTINENT GOVERNMENT BILL OF LADING. WE NOTE, FOR EXAMPLE, THAT GOVERNMENT RATE TARIFF NO. 1 IS SPECIFICALLY MENTIONED IN BILL OF LADING C -2166111. SUCH A SPECIFIC REFERENCE REFLECTS THE PARTIES' INTENTION THAT THE RATE BASES THEREIN NAMED BE USED TO COMPUTE THE ALLOWABLE CHARGES. THE TWO RATES NAMED IN ITEM 4110 OF GOVERNMENT RATE TARIFF NO. 1 SPECIFICALLY COVER TRUCKLOAD MOVEMENTS OF GUN MOUNTS FROM ROCK ISLAND ARSENAL TO THE ABERDEEN PROVING GROUNDS, AND THE RATES PRESUMABLY WERE ESTABLISHED FOR THE PARTICULAR PURPOSE OF APPLYING TO ALL MOVEMENTS OF GUN MOUNTS IN TRUCKLOAD QUANTITIES FROM THE ROCK ISLAND ARSENAL TO THE ABERDEEN PROVING GROUNDS.

WHILE WE CONTINUE TO ADHERE TO THE CURTIS LIGHTING CASE PRINCIPLE IN APPROPRIATE INSTANCES AND THUS TO USE A TRUCKLOAD CHARGE BASIS ON CAPACITY LOADS, WE NOTE THAT GOVERNMENT RATE TARIFF NO. 1, IN ITEM 130, ALSO PROVIDES A CHARGE BASIS FOR "SPECIAL MILITARY SERVICES," CONSIDERABLY LOWER THAN THE SO-CALLED EXCLUSIVE-USE BASIS FOR WHICH YOU CLAIMED AND WERE PAID CHARGES ON THE THREE SHIPMENTS HERE INVOLVED. IN ADDITION TO AN ASSURANCE OF EXCLUSIVE USE, THE SPECIAL MILITARY SERVICES PROVISION HAS OTHER TERMS AND CONDITIONS FURNISHING ASSURANCES GOING BEYOND THOSE FOUND IN THE EXCLUSIVE-USE TARIFF PROVISIONS. FOR EXAMPLE, WHILE EXCLUSIVE-USE PROVISIONS GENERALLY DO NOT CONTAIN SPECIFIC ASSURANCE AS TO EXPEDITED TRANSPORTATION, ITEM 130 STATES THAT SHIPMENTS ACCORDED SPECIAL MILITARY SERVICE "WILL BE TRANSPORTED FASTER THAN WITH REASONABLE DISPATCH TO MEET SPECIFIC PICKUP OR DELIVERY TIMES OR CONDITIONS.' CONSIDERING THE FACT THAT ITEM 130 ALSO PROVIDES FOR EXCLUSIVE-USE SERVICE WITH ADDITIONAL GUARANTEES BY THE CARRIERS, THERE IS NO APPARENT REASON WHY THE MORE ECONOMICAL CHARGES BASIS THERE PRESCRIBED SHOULD NOT BE AVAILABLE TO THE GOVERNMENT IN PREFERENCE TO THE EXCLUSIVE USE CHARGE BASIS, IF THE CURTIS LIGHTING CASE PRINCIPLE IS FOUND TO BE INAPPROPRIATE FOR APPLICATION TO THE THREE SHIPMENTS IN QUESTION.

IN THE EVENT COLLECTION IS MADE BY OUR TRANSPORTATION DIVISION OF THE OVERCHARGES DETERMINED TO HAVE BEEN PAID, AND THE FINAL JUDICIAL DETERMINATION OF THE QUESTIONS IN THE GARRETT FREIGHT LINES CASE IS AGAINST THE GOVERNMENT, DAVIDSON'S TIMELY FILED CLAIMS FOR SUCH COLLECTED AMOUNTS AS IT DEEMS ARE DUE WILL BE GIVEN CONSIDERATION. WE ARE FURNISHING A COPY OF THIS LETTER TO DAVIDSON TRANSFER AND STORAGE COMPANY.

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