B-151982, OCT. 11, 1963

B-151982, OCT. 11, 1963

TO ILLINOIS CENTRAL RAILROAD:

REFERENCE IS MADE TO YOUR LETTER OF JULY 1, 1963, FILE G-AFR-31079 BG AFR -55555, REQUESTING REVIEW OF OUR SETTLEMENT CERTIFICATES OF SEPTEMBER 22, 1959, AND JANUARY 21, 1960. THESE CERTIFICATES DISALLOWED CHARGES CLAIMED ON INBOUND TRANSIT SHIPMENTS FOR THE DEFICIT WEIGHTS ADDED TO THE ACTUAL WEIGHTS TO EQUAL THE MINIMUM CARLOAD WEIGHTS GOVERNING THE RATES USED ON SHIPMENTS ACCORDED TRANSIT PRIVILEGES UNDER THE PROVISIONS OF SOUTHERN FREIGHT ASSOCIATION SECTION 22 QUOTATION NO. A-610-A.

YOUR FIRST CLAIM (OUR TK-674831), ON SUPPLEMENTAL BILL NO. AFR-31079 A, WAS FOR $218.96, AND OF THIS AMOUNT $198.95 WAS WITHDRAWN THROUGH YOUR ACCEPTANCE OF OUR BASIS FOR SETTLEMENT OF THE CHARGES ON GOVERNMENT BILLS OF LADING WZ-T-272167 AND WZ-T-148603. YOU CONTINUE TO CLAIM THE REMAINING $20.01 ($218.96 LESS $198.95) ON SUPPLEMENTAL BILL NO. AFR-31079 -A AS ADDITIONAL FREIGHT CHARGES DUE ON AN OUTBOUND TRANSIT SHIPMENT TRANSPORTED FROM GRANITE CITY, ILLINOIS, TO NEW ORLEANS, LOUISIANA, UNDER GOVERNMENT BILL OF LADING WZ-T-148602. THIS SHIPMENT WEIGHED 32,000 POUNDS AND HAD BEEN STORED-IN-TRANSIT AT GRANITE CITY UNDER THE PROVISIONS OF SOUTHERN FREIGHT ASSOCIATION SECTION 22 QUOTATION ADVICE NO. A-610-A. THE INBOUND BILLING FOR THE SHIPMENT SHOWS THAT IT ORIGINATED AT CHICAGO, ILLINOIS, MOVED TO GRANITE CITY UNDER GOVERNMENT BILL OF LADING WY- 1229414, AND THAT CHARGES OF $233.45WERE PAID ON THE BASIS OF ACTUAL WEIGHT OF 32,000 POUNDS AS 35,000 POUNDS MINIMUM WEIGHT AT A RATE OF 58 CENTS PER 100 POUNDS PLUS 15 PERCENT INCREASE. IN THE PAYMENT OF CHARGES ON OUTBOUND BILL OF LADING WZ-T-148602 WE HAVE TAKEN CREDIT FOR THE FULL AMOUNT PAID INTO THE TRANSIT POINT ($233.45). YOU CLAIM $20.01 ADDITIONAL CHARGES, CONTENDING THAT CREDIT FOR ONLY THE CHARGES PAID IN ON THE ACTUAL WEIGHT MAY BE TAKEN IN COMPUTING PAYMENT OF THE OUTBOUND CHARGES (32,000 POUNDS AT 58 CENTS PLUS 15 PERCENT EQUALS $213.44).

YOUR OTHER CLAIM (OUR TK-678715), FOR $88.67 ON SUPPLEMENTAL BILL NO. AFR -55555-B, IS FOR ADDITIONAL FREIGHT CHARGES ON AN OUTBOUND SHIPMENT TRANSPORTED FROM FORT WORTH, TEXAS, TO NEW ORLEANS, LOUISIANA, UNDER GOVERNMENT BILL OF LADING WZ-T-364416. THE SHIPMENT WEIGHED 25,650 POUNDS, OF WHICH 12,297 POUNDS HAD BEEN STORED-IN TRANSIT AT FORT WORTH UNDER THE PROVISIONS OF SFA SECTION 22 QUOTATION ADVICE NO. A-610-A. THE REMAINING 13,353 POUNDS MOVED FROM FORT WORTH TO NEW ORLEANS AS NONTRANSIT TONNAGE AND IS NOT IN DISPUTE. THE 12,297 POUNDS MOVED INBOUND FROM WAUSAU, WISCONSIN, UNDER GOVERNMENT BILL OF LADING WY-5504211. INBOUND CHARGES OF $492 WERE PAID ON THE BASIS OF ACTUAL WEIGHT OF 12,297 POUNDS COMPUTED AS 15,000 POUNDS MINIMUM WEIGHT AT A RATE OF $3.28 PER 100 POUNDS. IN THE SETTLEMENT OF THE CHARGES ON OUTBOUND BILL OF LADING WZ-T- 364416 WE HAVE TAKEN CREDIT FOR THE FULL AMOUNT PAID INTO THE TRANSIT POINT ($492). YOU CONTEND THAT CREDIT MAY BE TAKEN ONLY FOR THE AMOUNT PAID ON THE ACTUAL WEIGHT MOVING INBOUND, THAT IS, 12,297 POUNDS AT $3.28 PER 100 POUNDS, OR $403.34. THE MINIMUM WEIGHT GOVERNING THE THROUGH SHIPMENT IS 12,000 POUNDS. YOUR CLAIM FOR $88.67 RESULTS FROM THE DIFFERENCE BETWEEN THE MINIMUM WEIGHT INBOUND (15,000 POUNDS) AND THE ACTUAL WEIGHT (12,297 POUNDS) OF 2,703 POUNDS COMPUTED AT THE RATE OF $3.28 PER 100 POUNDS.

IT IS YOUR CONTENTION THAT THE CHARGES FOR THE INVOLVED CLAIMS SHOULD BE COMPUTED IN ACCORDANCE WITH ITEM 17 OF SFA SECTION 22 QUOTATION 610-A WHICH PROVIDES IN PERTINENT PART, THAT:

"THE GOVERNMENT SHALL PAY THE THROUGH RATE * * * MINUS THE LINE-HAUL RATE * * * PAID ON SUCH SHIPMENT INTO SUCH TRANSIT POINT * * *.' IN THIS CONNECTION YOU STATE THAT:

"IN DETERMINING THE CREDIT DUE ON THE INBOUND MOVEMENT, THE CHARGES MUST BE COMPUTED ON THE RATE AND BILLED WEIGHT RESHIPPED FROM THE TRANSIT POINT. NOWHERE IN THE QUOTATION DO WE FIND THAT THE TRANSIT OPERATION AUTHORIZES THE DEDUCTION OF THE TOTAL CHARGES PAID INTO THE TRANSIT POINT WHICH IN MANY INSTANCES REPRESENT THE MINIMUM WEIGHT NECESSARY TO OBTAIN THE CARLOAD BASIS ON THE INBOUND MOVE.'

UPON THE EXERCISE OF THE TRANSIT PRIVILEGE, THE INBOUND LOSES ITS IDENTITY AS A COMPLETED SHIPMENT AND BECOMES A PART OF THE THROUGH MOVEMENT UPON WHICH THE THROUGH RATE APPLIES. FREDONIA LINSEED OIL WORKS CO. V. ATCHISON, T. AND S.F.RY.CO., 201 I.C.C. 41 (1934); SAWDUST SALES CO. V. BALTIMORE AND O.R.CO., 186 I.C.C. 265, 268 (1932); STALEY MANUFACTURING CO. TERMINAL ALLOWANCE, 245 I.C.C. 383, 392 (1941). THE ENTIRE MOVEMENT IS TREATED AS IF THE SHIPMENT HAD MOVED FROM ORIGIN TO DESTINATION WITHOUT A STOP FOR TRANSIT. BALTIMORE AND O.R.CO. V. UNITED STATES, 24 F.SUPP. 734, 735 (1938). WHEELOCK AND BIERD V. AKRON, C. AND Y.RY.CO., 179 I.C.C. 517, 520-521 (1921). CHICAGO BOARD OF TRADE V. ANN ARBOR R.CO., 39 I.C.C. 643, 651 (1916); LARABEE FLOUR MILLS CO. V. CHICAGO, B. AND O.R.CO., 223 I.C.C. 55, 64 (1937). KANSAS CITY BOARD OF TRADE V. ATCHISON, T. AND S.F.RY. CO., 69 I.C.C. 185, 189 (1922).

THE INBOUND RATE IS NOT APPLICABLE TO THE SHIPMENT, AND THE PRINCIPLES APPLICABLE TO THE THROUGH SHIPMENT GOVERN THE TRANSPORTATION. IN THE ADJUSTMENT OF THE CHARGES THE CARRIERS RECEIVE THE BENEFIT OF THE THROUGH RATE APPLICABLE ON THE THROUGH SHIPMENT--- THE CHARGES FROM ORIGINAL POINT OF ORIGIN TO ULTIMATE DESTINATION, LESS THE INBOUND CHARGES ALREADY PAID. DUCK RIVER GRAIN CO. V. NASHVILLE, C. AND ST.L. RY., 160 I.C.C. 28, 29-30 (1929); BEACON MILLING CO., INC., V. NEW YORK C.R.CO., 157 I.C.C. 635, 636 (1929); JOHN W. ESHELMAN AND SONS V. ARKANSAS, C.R.CO., 87 I.C.C. 285, 290 (1924); SOUTHERN CREOSOTING INDUSTRIES V. ALABAMA G.S.R.CO., 153 I.C.C. 625, 627 (1929).

ITEM 6, PARAGRAPH (A), OF QUOTATION 610-A PROVIDES THAT WHEN RESHIPPED FROM THE TRANSIT POINT EACH SHIPMENT MADE FROM INITIAL POINT OF ORIGIN SHALL BE SUBJECT AND ENTITLED TO THE CARLOAD RATE FROM SUCH POINT OF ORIGIN TO THE PORT OF TRANSSHIPMENT OR RAILHEAD. AS USED IN THE INTERSTATE COMMERCE ACT, THE WORD RATE MEANS THE CHARGE AS FINALLY COMPUTED ON THE BASIS OF DOLLARS AND CENTS PER 100 POUNDS AND THE MINIMUM WEIGHT WHICH IS A PART OF THE RATE. BENNETT COMMISSION CO. V. NORTHERN P.RY.CO., 271 N.W. 468, 471 (1937). SEE ALSO, CLARK V. SOUTHERN RY.CO., 119 N.E. 539, 542 (1918); GREAT NORTHERN RY.CO. V. ARMOUR AND CO., 26 F.SUPP. 964, 967 (1939); AND UNITED STATES V. CHICAGO AND A.RY.CO., 148 F. 646, 647 (1906). THUS, THE HEADING "THROUGH RATE" TO PARAGRAPH (A) OF ITEM 6 OF QUOTATION 610-A SEEMS TO MEAN THROUGH CHARGES.

ON THE SHIPMENTS UNDER CONSIDERATION, THE MINIMUM WEIGHT GOVERNING THE LOCAL RATE TO THE TRANSIT POINT EQUALLED OR EXCEEDED THE MINIMUM WEIGHT PROVIDED IN CONNECTION WITH THE THROUGH RATE, AND THE INBOUND CHARGES TO THE TRANSIT POINT WERE ASSESSED ON THE TOTAL OF BOTH THE ACTUAL INBOUND WEIGHT OF THE SHIPMENT AND SUFFICIENT DEFICIT WEIGHT TO MAKE UP THE HIGHER INBOUND MINIMUM WEIGHT APPLYING TO THE TRANSIT POINT. HOWEVER, UNDER THE TRANSIT ARRANGEMENT, THE PRINCIPLES APPLICABLE TO THE THROUGH SHIPMENT GOVERN THE TRANSPORTATION MOVEMENT, AND IN THE ADJUSTMENT OF THE FREIGHT CHARGES THE CARRIERS ARE ENTITLED TO THE RATE AND MINIMUM WEIGHT APPLICABLE TO THE THROUGH MOVEMENT OF THE TRANSITED COMMODITY. DUCK RIVER GRAIN CO., SUPRA.

IN THE LIGHT OF THE PRINCIPLES GOVERNING TRANSIT GENERALLY, AS SET OUT IN THE DECISIONS OF THE INTERSTATE COMMERCE COMMISSION AND OF THE COURTS REFERRED TO ABOVE, IT IS OUR VIEW THAT THE APPLICABLE CHARGES ARE THOSE BASED ON A THROUGH MOVEMENT, AND THAT TOTAL CHARGES PAID ON THE INBOUND MOVEMENT ARE PROPERLY TO BE CREDITED AGAINST THE THROUGH CHARGES. SUCH THROUGH CHARGES HAVE BEEN PAID, AND THUS THE GOVERNMENT HAS ALREADY PAID TO THE CARRIERS THE THROUGH CHARGES BASED ON THE THROUGH MINIMUM WEIGHT FOR CARRYING THE SAME WEIGHT INBOUND AND OUTBOUND. FOR SUCH CHARGES IT COULD HAVE SHIPPED THE MINIMUM WEIGHT INBOUND AND OUTBOUND, A GREATER SERVICE. SEE FRUIT STORED IN TRANSIT IN THE SOUTHWEST, 190 I.C.C. 153 (1932), WHERE ON PAGE 157 THE COMMISSION CONDEMNED A TRANSIT RULE WHICH RESULTED IN THE ASSESSMENT OF GREATER CHARGES FOR A LESSER SERVICE. ACCORDINGLY, WE PERCEIVE NO PROPER BASIS FOR ALLOWANCE OF ANY ADDITIONAL CHARGES AND THE SETTLEMENTS DISALLOWING YOUR CLAIMS FOR $20.01 AND $88.67 IN ADDITIONAL CHARGES APPEAR PROPER AND ARE SUSTAINED.