B-243477, Jun 6, 1991, 91-1 CPD ***

B-243477, Jun 6, 1991, 91-1 CPD ***

PROCUREMENT - Payment/Discharge - Shipment - Carrier liability - Burden of proof DIGEST: A carrier who picked up an Army member's household goods, stored them in its own warehouse, and subsequently delivered them to the member's new address, is not automatically relieved of liability as a carrier for loss/damage, to be held to a warehouse's more limited liability, simply because it listed exceptions for loss/damage on the warehouse's inventory.

A-1 Ace Moving and Storage, Inc.:

The Air Force appeals a January 22, 1991, settlement by our Claims Group denying setoff of $722 against A-1 Ace Moving and Storage, Inc. for unexplained damage to MSgt. John Scoppetta's household goods. We reverse the Claims Group's settlement.

A-1 picked the goods up from the member, stored them in a warehouse for 2 months and then delivered them from its warehouse to MSgt. Scoppetta. A-1 took numerous exceptions for damage to the goods upon taking them out of its warehouse.

The carrier's liability under the Government Bill of Lading was $1.25 per pounds, whereas the liability of a warehouseman is limited by Air Force regulations to $50 per article. Although A-1 was the sole carrier and warehouseman, it maintained that the exceptions it noted when picking the goods up for final delivery limited its liability to that of a warehouseman. Our Claims Group agreed, finding that since the property changed hands from A-1 as carrier under one contract to that of a warehouseman under another, its liability was so limited.

The Air Force contends that since the property in fact never left A 1's custody, the regulation is inapplicable. The Air Force concedes that the exception would have properly limited A-1 liability if the warehouse belonged to a third party.

We agree with the Air Force, as explained in paragraph 6-57 of Air Force Regulation (AFR) 112-1(c)(2)), where more than one carrier is involved in transporting a shipment of household goods, each carrier is held responsible only for the portion it actually controlled. Each carrier, in order to protect itself against liability for loss of or damage to goods that already were lost or damaged when the carrier took custody of them, generally records the shipments condition in writing at that time. The regulation specifies that when removing a shipment from a warehouse for delivery, the carrier may prepare an exception sheet (known as a "rider") to the warehouse's inventory, to be signed by both parties, which will control liability for the items listed. The last carrier is-- responsible for loss/damage to items not included on an exception sheet.

When goods moved by a carrier were delivered in poorer condition than when they were picked up, to avoid liability the carrier must show that the damage or loss did not occur while in its custody. 57 Comp.Gen. 415, 418 (1978). Hence, however, the same party was both warehouseman and delivered carrier. We do not think it makes sense in that case to permit the carrier to limit its liability simply by listing exceptions to its own warehouse's inventory, despite the fact that the carrier held separate contract for each service.

As the Air Force points out in its appeal, that to find otherwise would permit carriers who are also warehousemen escape full liability for loss/damage items of which it never lost custody irrespective of when or where the loss or damage in fact occurred.

Since there is no such showing here the only evidence of place of damage being A-1's rider we reverse the Claims group's decision.

In our view, then, in cases like these the burden necessarily remains on the carrier to show that the goods were damaged during storage rather than during deliver to or from its warehouse.