B-176289, MAY 15, 1974, 53 COMP GEN 866

B-176289, MAY 15, 1974, 53 COMP GEN 866

STATUTES OF LIMITATION - CLAIMS - TRANSPORTATION - SET-OFF RECLAIMS THE RIGHT TO RECOVER AN ERRONEOUS PAYMENT MADE TO A CARRIER FOR A TRANSPORTATION SERVICE CLAIMED TO HAVE BEEN PERFORMED FOR THE UNITED STATES, BUT WHICH IN FACT HAD NOT BEEN PERFORMED FOR THE UNITED STATES, IS NOT SUBJECT TO THE TIME LIMITATION IN 49 U.S.C. 66; AFTER REVIEW AND RECONSIDERATION, PRIOR DECISION AFFIRMED.

IN THE MATTER OF TRANS COUNTRY VAN LINES, INC., MAY 15, 1974:

TRANS COUNTRY VAN LINES, INC., BY LETTER DATED APRIL 2, 1974, FILE 7301-R -21-474/873, ASKS FOR REVIEW AND RECONSIDERATION OF DECISION B 176289, DATED OCTOBER 23, 1973.

THE DECISION ALLOWED THE CARRIER'S CLAIM FOR $674.55, THE AMOUNT THAT HAD BEEN PREVIOUSLY DEDUCTED FROM CARRIER REVENUE TO RECOVER AN ALLEGED OVERCHARGE, BUT DENIED THE CARRIER'S CLAIM FOR $1,743, AN AMOUNT THAT HAD BEEN DEDUCTED FROM CARRIER REVENUE TO RECOVER AN ERRONEOUS PAYMENT MADE BY THE ARMY FINANCE CENTER IN CONNECTION WITH GOVERNMENT BILL OF LADING (GBL) D-0886089. TRANS COUNTRY'S CONTENTION WAS AND IS THAT THE GOVERNMENT'S RIGHT TO MAKE THE SECOND DEDUCTION WAS TIME BARRED BECAUSE THE DEDUCTION WAS MADE AFTER THE EXPIRATION OF THE 3-YEAR PERIOD OF LIMITATION PROVIDED IN 49 U.S.C. 66. THE FACTS IN THE CASE ARE SET FORTH BELOW.

ON JULY 7, 1967, THE GENERAL ELECTRIC COMPANY TENDERED A SHIPMENT OF ELECTRONIC EQUIPMENT TO TRANS COUNTRY FOR TRANSPORTATION FROM SYRACUSE, NEW YORK, TO EGLIN AIR FORCE BASE, FLORIDA, UNDER A COMMERCIAL BILL OF LADING. THE CHARGES FOR THE SHIPMENT, IN THE AMOUNT OF $1,743, BASED ON THE APPLICABLE COMMERCIAL RATE, WERE PAID TO TRANS COUNTRY BY THE GENERAL ELECTRIC COMPANY BY CHECK DATED JULY 27, 1967.

WHEN THE SHIPMENT REACHED EGLIN AIR FORCE BASE, THE BASE TRANSPORTATION OFFICE ISSUED GBL D-0886089 UNDER THE MISTAKEN IMPRESSION THAT THE COMMERCIAL BILL OF LADING WAS TO BE CONVERTED TO A GOVERNMENT BILL OF LADING AT DESTINATION. USING THIS GBL AS SUPPORT, TRANS COUNTRY SUBMITTED A BILL FOR $1,743 TO THE ARMY FINANCE CENTER AND THE BILL WAS PAID APRIL 4, 1968.

WHEN THE BILL WAS AUDITED HERE, A NOTICE OF OVERCHARGE IN THE AMOUNT OF $674.55 WAS ISSUED TO TRANS COUNTRY, BASED ON THE DIFFERENCE BETWEEN THE COMMERCIAL RATE AND A SECTION 22 QUOTATION RATE APPLICABLE TO GOVERNMENT SHIPMENTS. UPON THE CARRIER'S FAILURE TO REFUND, THE AMOUNT OF $674.55 WAS DEDUCTED FROM REVENUE DUE TRANS COUNTRY FOR OTHER SERVICES. THEREAFTER IT WAS LEARNED THAT THE GENERAL ELECTRIC COMPANY HAD PAID THE CHARGES FOR THE SHIPMENT FOR ITS OWN ACCOUNT, THAT THE GOVERNMENT WAS NOT LIABLE FOR THE TRANSPORTATION CHARGES, AND THAT GBL D-0886089 SHOULD NOT HAVE BEEN ISSUED TO COVER THE SHIPMENT. A SECOND DEDUCTION, IN THE AMOUNT OF $1,743, WAS THEN MADE TO RECOVER THE ORIGINAL PAYMENT MADE BY THE ARMY FINANCE CENTER.

TRANS COUNTRY FILED CLAIMS FOR RECOVERY OF BOTH DEDUCTIONS AND THE DECISION OF OCTOBER 23, 1973, ALLOWED RECOVERY OF THE FIRST DEDUCTION, IN THE AMOUNT OF $674.55, BUT DENIED RECOVERY OF THE SECOND DEDUCTION, IN THE AMOUNT OF $1,743.

AS INDICATED, TRANS COUNTRY ASKS FOR REVIEW AND RECONSIDERATION ON THE SOLE GROUND THAT THE SECOND DEDUCTION WAS MADE MORE THAN THREE YEARS AFTER THE ORIGINAL PAYMENT AND WAS THEREFORE BARRED BY THE 3-YEAR PERIOD OF LIMITATION CONTAINED IN 49 U.S.C. 66. THE CARRIER'S CONTENTION IS WITHOUT MERIT BECAUSE THE DEDUCTION IN QUESTION WAS NOT MADE PURSUANT TO THE PROVISIONS OF 49 U.S.C. 66. THAT STATUTE PROVIDES THAT PAYMENT FOR TRANSPORTATION OF PROPERTY FOR OR ON BEHALF OF THE UNITED STATES BY ANY CARRIER OR FORWARDER SHALL BE MADE UPON PRESENTATION OF BILLS THEREFOR, PRIOR TO AUDIT OR SETTLEMENT BY THE GENERAL ACCOUNTING OFFICE, BUT THE RIGHT IS RESERVED TO THE UNITED STATES GOVERNMENT TO DEDUCT THE AMOUNT OF ANY OVERCHARGE BY ANY CARRIER OR FORWARDER FROM ANY AMOUNT SUBSEQUENTLY FOUND TO BE DUE SUCH CARRIER OR FORWARDER PROVIDED THE DEDUCTION IS MADE WITHIN THREE YEARS FROM THE TIME OF PAYMENT OF BILLS.

IN THE SUBJECT CASE, NO TRANSPORTATION FOR OR ON BEHALF OF THE UNITED STATES WAS PERFORMED BY TRANS COUNTRY. THE SERVICE WAS PERFORMED FOR THE GENERAL ELECTRIC COMPANY AND THAT COMPANY PAID THE CHARGES. THE PAYMENT THAT WAS MADE TO TRANS COUNTRY BY THE ARMY FINANCE CENTER WAS MADE PURSUANT TO A VOUCHER SUBMITTED BY THE CARRIER BEARING A CERTIFICATION THAT THE ACCOUNT STATED WAS CORRECT AND JUST, THAT SERVICES HAD BEEN RENDERED AS INDICATED, AND THAT PAYMENT HAD NOT BEEN RECEIVED. IN FACT, THE SERVICES HAD BEEN RENDERED FOR THE GENERAL ELECTRIC COMPANY AND PAYMENT HAD BEEN RECEIVED FROM THAT COMPANY LONG BEFORE THE VOUCHER WAS PRESENTED TO THE ARMY FINANCE CENTER FOR PAYMENT.

IN THESE CIRCUMSTANCES, THE DEDUCTION MADE TO RECOVER THE ERRONEOUS PAYMENT WAS NOT A DEDUCTION FOR RECOVERY OF AN OVERCHARGE WITHIN THE MEANING OF 49 U.S.C. 66, AND CONSEQUENTLY WAS NOT SUBJECT TO THE TIME LIMITATION CONTAINED THEREIN. THE RIGHT TO RECOVER THE ERRONEOUS PAYMENT AROSE BECAUSE THE CARRIER WAS PAID FOR A SERVICE THAT IT DID NOT PERFORM AND THE DEDUCTION WAS MADE PURSUANT TO THE COMMON-LAW RIGHT OF SETOFF APPROVED IN UNITED STATES V. MUNSEY TRUST COMPANY, 332 U.S. 234 (1947). WE ARE NOT AWARE OF ANY STATUTORY TIME LIMITATION THAT WOULD BAR RECOVERY OF THE ILLEGAL PAYMENT MADE IN THIS CASE PURSUANT TO MISTAKE OF FACT.

FOR THE REASONS STATED, AFTER REVIEW AND RECONSIDERATION, THE PRIOR DECISION IS AFFIRMED.