A-52065, MAY 9, 1935, 14 COMP. GEN. 814

A-52065: May 9, 1935

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AS FOLLOWS: I HAVE TO REFER TO YOUR LETTER TO ME UNDER DATE OF FEBRUARY 27. YOU ARE ADVISED THAT THIS DEPARTMENT HAD ITS REPRESENTATIVES. THE PERFORMANCE OF THE VESSEL WAS OBSERVED OVER THE ROUTE FROM GALVESTON TO PORT-AU-PRINCE AND OVER THE MEASURED MILE OFF GUANTANAMO BAY. THE POSTMASTERS AT THE PORTS OF DEPARTURE OF ROUTE 23 HAVE BEEN INSTRUCTED TO PLACE NO MORE MAIL ON THE S.S. COPIES OF WHICH I BELIEVE HAVE HERETOFORE BEEN FURNISHED YOU. THAT THIS VESSEL HAS BEEN INCAPABLE OF MAINTAINING 13 KNOTS AT SEA IN ORDINARY WEATHER SINCE SHE WAS ACCEPTED FOR SERVICE ON THIS ROUTE AS A CLASS 5 VESSEL ON SEPTEMBER 14. MARGARET LYKES AS A CLASS 5 VESSEL CAPABLE OF MAINTAINING 13 KNOTS AT SEA IN ORDINARY WEATHER ON "SPEED WITHOUT REGARD TO TONNAGE" WAS BASED UPON AN AFFIDAVIT BY MR.

A-52065, MAY 9, 1935, 14 COMP. GEN. 814

TRANSPORTATION OF MAIL - INADEQUACY OF VESSEL WHERE A VESSEL USED FOR CARRYING UNITED STATES MAIL UNDER A CONTRACT PURSUANT TO TITLE IV OF THE MERCHANT MARINE ACT OF 1928 (45 STAT. 692), TOTALLY FAILS THROUGHOUT THE PERIOD OF THE VESSEL'S SERVICE ON THE ROUTE TO MAKE GOOD ITS COVENANTS WITH THE GOVERNMENT, DEMAND SHOULD BE MADE ON THE CONTRACTOR FOR RETURN OF THE FULL AMOUNT PAID UNDER THE CONTRACT.

COMPTROLLER GENERAL MCCARL TO THE POSTMASTER GENERAL, MAY 9, 1935:

THERE HAS BEEN CONSIDERED YOUR LETTER OF MARCH 8, 1935, AS FOLLOWS:

I HAVE TO REFER TO YOUR LETTER TO ME UNDER DATE OF FEBRUARY 27, 1934, AND TO SUBSEQUENT CORRESPONDENCE RESPECTING THE SPEED OF THE S.S. MARGARET LYKES, HERETOFORE EMPLOYED IN SERVICE ON F.O.M. ROUTE 23.

YOU ARE ADVISED THAT THIS DEPARTMENT HAD ITS REPRESENTATIVES, LIEUTENANT COMMANDER ALBERT M. BLEDSOE OF THE NAVY DEPARTMENT, A COMPETENT NAVIGATOR, AND MR. PETER THOMPSON, SENIOR INSPECTOR OF THE U.S. SHIPPING BOARD BUREAU OF NEW ORLEANS, A LICENSED MARINE ENGINEER, ATTEND A TEST OF THIS VESSEL ON THE VOYAGE LEAVING GALVESTON, TEXAS, ON FEBRUARY 10, 1935. THE PERFORMANCE OF THE VESSEL WAS OBSERVED OVER THE ROUTE FROM GALVESTON TO PORT-AU-PRINCE AND OVER THE MEASURED MILE OFF GUANTANAMO BAY, CUBA. THE VESSEL FAILED TO MAKE THE REQUIRED SPEED OF 13 KNOTS EITHER ON THE VOYAGE OR OVER THE MEASURED MILE.

I AM ENCLOSING HEREWITH FOR YOUR INFORMATION A COPY OF THE VERIFIED REPORT OF LIEUTENANT COMMANDER BLEDSOE AND MR. THOMPSON, DATED FEBRUARY 28, 1935, WITH COPIES OF THE EXHIBITS REFERRED TO THEREIN.

THE POSTMASTERS AT THE PORTS OF DEPARTURE OF ROUTE 23 HAVE BEEN INSTRUCTED TO PLACE NO MORE MAIL ON THE S.S. MARGARET LYKES.

IT APPEARS FROM THIS TEST AND OTHER DATA IN THE FILES OF THIS DEPARTMENT, COPIES OF WHICH I BELIEVE HAVE HERETOFORE BEEN FURNISHED YOU, THAT THIS VESSEL HAS BEEN INCAPABLE OF MAINTAINING 13 KNOTS AT SEA IN ORDINARY WEATHER SINCE SHE WAS ACCEPTED FOR SERVICE ON THIS ROUTE AS A CLASS 5 VESSEL ON SEPTEMBER 14, 1929.

IT APPEARS THAT THE ORIGINAL ACCEPTANCE AND CLASSIFICATION OF THE S.S. MARGARET LYKES AS A CLASS 5 VESSEL CAPABLE OF MAINTAINING 13 KNOTS AT SEA IN ORDINARY WEATHER ON "SPEED WITHOUT REGARD TO TONNAGE" WAS BASED UPON AN AFFIDAVIT BY MR. JAMES M. LYKES UNDER DATE OF NOVEMBER 8, 1929, FURNISHED TO THE SHIPPING BOARD TO THE EFFECT THAT THE VESSEL WAS THEN "CAPABLE OF MAINTAINING A SPEED OF 13 KNOTS AT SEA IN ORDINARY WEATHER.'

THE PROVISION IN THE CONTRACT COVERING SERVICE ON THIS ROUTE UNDER WHICH THIS VESSEL WAS OFFERED FOR SERVICE DESIGNATES A VESSEL OF "CLASS 5" AND DESCRIBES IT AS ONE CAPABLE OF MAINTAINING A SPEED OF 13 KNOTS AT SEA IN ORDINARY WEATHER AND OF A GROSS REGISTERED TONNAGE OF NOT LESS THAN 4,000 TONS. THE S.S. MARGARET LYKES IS OF LESS THAN 4,000 TONS. THE LAW (SECTION 408 (B) OF THE MERCHANT MARINE ACT OF 1928) PERMITS THE CLASSIFICATION OF VESSELS ON SPEED WITHOUT REGARD TO TONNAGE.

"IF THE POSTMASTER GENERAL IS OF OPINION THAT SPEED IS ESPECIALLY IMPORTANT ON THE PARTICULAR ROUTE ON WHICH THE VESSEL IS TO BE EMPLOYED, AND THAT A SUITABLE VESSEL DOCUMENTED UNDER THE LAWS OF THE UNITED STATES OF A HIGHER CLASSIFICATION IS NOT AVAILABLE ON REASONABLE TERMS AND CONDITIONS, OR, ON ACCOUNT OF THE CHARACTER OF THE PORTS SERVED OR FOR OTHER REASONS, CANNOT BE SAFELY OR ECONOMICALLY EMPLOYED ON SUCH ROUTE.'

IN YOUR LETTER TO THIS DEPARTMENT UNDER DATE OF JANUARY 2, 1929 (A 25473), YOU STATED THAT:

"IF THE POSTMASTER GENERAL SHOULD DETERMINE THAT A VESSEL OF 3,658 TONS MAKING A SPEED OF 13 KNOTS AT SEA IN ORDINARY WEATHER IS A CLASS 5 VESSEL, SUCH DETERMINATION IS AUTHORIZED UNDER SECTION 408 (B) OF THE MERCHANT MARINE ACT OF 1928, AND SUCH VESSEL MAY BE ACCEPTED IF ADMINISTRATIVELY DETERMINED DESIRABLE IN LIEU OF A VESSEL CLASSIFIED ON THE BASIS OF BOTH SPEED AND TONNAGE.'

THE FILES AND RECORDS OF THIS DEPARTMENT DISCLOSE NO REASON WHATSOEVER FOR THE WAIVING OF THE TONNAGE REQUIREMENT OF THE LAW IN THE CLASSIFICATION OF THIS VESSEL. THE OTHER VESSELS EMPLOYED ON THIS ROUTE HAVE A SPEED OF 10 KNOTS OR LESS.

I AM TRANSMITTING HEREWITH A CHRONOLOGICAL INDEX OF THE PAPERS IN THE FILES OF THIS DEPARTMENT RESPECTING THE S.S. MARGARET LYKES. I WILL BE GLAD TO FORWARD TO YOU COPIES OF ANY OF THESE PAPERS YOU MAY DESIRE.

SINCE IT APPEARS THAT THIS VESSEL HAS NEVER BEEN CAPABLE OF MAINTAINING 13 KNOTS AT SEA IN ORDINARY WEATHER, YOU ARE REQUESTED TO ADVISE ME WHETHER THE DEPARTMENT SHOULD TAKE STEPS TO RECOVER THE PAYMENTS MADE TO THE CONTRACTOR FOR SERVICE BY THIS VESSEL.

CONTRACT F.O.M. ROUTE NO. 23 ENTERED INTO ON AUGUST 28, 1928, WITH THE LYKES BROTHERS STEAMSHIP CO., INC., FOR A PERIOD OF 10 YEARS BEGINNING OCTOBER 1, 1928, PROVIDES FOR CARRYING THE MAILS OF THE UNITED STATES FROM GALVESTON, OR PORT ARTHUR, TEX., TO PORT-AU-PRINCE, HAITI, AND SANTO DOMINGO CITY, DOMINICAN REPUBLIC, AND TO SUCH OTHER PORTS AT WHICH THE CONTRACTOR'S VESSELS MAY CALL ON A SCHEDULE SATISFACTORY TO THE POSTMASTER GENERAL, OF NOT LESS THAN 52 TRIPS PER ANNUM, IT BEING STIPULATED THEREIN, AMONG OTHER THINGS, THAT IN THE PERFORMANCE OF THE SERVICE COVERED THEREUNDER THE STEAMSHIP COMPANY WAS:

* * * TO PROVIDE AND OPERATE * * * VESSELS OF CLASS 6, CAPABLE OF MAINTAINING A SPEED OF 10 KNOTS AT SEA IN ORDINARY WEATHER; PROVIDED, THAT THE CONTRACTOR MAY BE REQUIRED TO SUBSTITUTE ONE VESSEL OF CLASS 5, CAPABLE OF MAINTAINING A SPEED OF 13 KNOTS AT SEA IN ORDINARY WEATHER AND OF A GROSS REGISTERED TONNAGE OF NOT LESS THAN 4,000 TONS, WITHIN FOUR YEARS FROM THE BEGINNING OF SERVICE UNDER THIS CONTRACT * * *.

THE RATE OF COMPENSATION PROVIDED FOR IN THE CONTRACT IS $2.50 PER NAUTICAL MILE FOR VESSELS OF CLASS 6, AND $4 PER NAUTICAL MILE FOR VESSELS OF CLASS 5, SHOULD THE OPERATION OF SUCH LATTER CLASS OF VESSELS BE AGREED UPON. CF. SEC. 409 (A), 45 STAT. 694.

WITH RESPECT TO THE CLASSIFICATION OF VESSELS, IT IS PROVIDED IN THE CONTRACT THAT "ALL CLASSIFICATIONS OF VESSELS ON THIS ROUTE TO BE BASED UPON SPEED WITHOUT REGARD TO TONNAGE.' CF. SEC. 408 (B), 45 STAT. 694.

PAYMENTS UNDER THE CONTRACT ARE REQUIRED TO BE MADE MONTHLY WITH STIPULATION:

* * * THAT SUITABLE DEDUCTIONS, TO BE DETERMINED BY THE POSTMASTER GENERAL, MAY BE MADE FROM THE COMPENSATION PAYABLE UNDER THE CONTRACT FOR DELAYS, FAILURES TO PROPERLY SAFEGUARD THE MAILS, OR OTHER IRREGULARITIES IN THE PERFORMANCE OF THE CONTRACT. CF. SEC. 410, 45 STAT. 695.

IT IS FURTHER STIPULATED IN THE CONTRACT:

THAT THE POSTMASTER GENERAL MAY ANNUL THIS CONTRACT OR IMPOSE FINES AND PENALTIES, IN HIS DISCRETION * * * FOR FAILURE TO PROVIDE AND OPERATE ANY VESSEL IN ACCORDANCE WITH THE REQUIREMENT OF THE * * * CONTRACT; * * *

THE CONTRACT WAS ENTERED INTO PURSUANT TO THE PROVISIONS OF TITLE IV OF THE MERCHANT MARINE ACT OF 1928 (45 STAT. 692). IT IS REQUIRED BY SECTION 408 (A) OF SAID ACT THAT THE VESSELS EMPLOYED IN OCEAN MAIL SERVICE SHALL BE CLASSIFIED INTO CERTAIN CLASSES, TO BE DETERMINED BY TWO FACTORS, TO WIT: (1) GROSS REGISTERED TONNAGE OF THE VESSEL, AND (2) THE CAPACITY OF THE VESSEL TO MAINTAIN A CERTAIN SPEED AT SEA IN ORDINARY WEATHER. SECTION 408 (B) OF THE ACT, HOWEVER, ALLOWS THE POSTMASTER GENERAL TO CLASSIFY A VESSEL "WITHOUT REGARD TO TONNAGE" WHERE IN HIS OPINION ,SPEED IS ESPECIALLY IMPORTANT ON THE PARTICULAR ROUTE.'

SINCE THE VESSEL WAS REPRESENTED TO BE CAPABLE OF MAINTAINING A SPEED OF 13 KNOTS AT SEA IN ORDINARY WEATHER, AND BEING A VESSEL OF GROSS REGISTERED TONNAGE LESS THAN 4,000 TONS, WAS ACCEPTED FOR OPERATION ON THE ROUTE AS A CLASS 5 VESSEL "WITHOUT REGARD TO TONNAGE," AND BECAUSE ,SPEED IS ESPECIALLY IMPORTANT ON THE PARTICULAR ROUTE," AND SINCE IT IS NOW ESTABLISHED TO YOUR SATISFACTION THAT THE VESSEL IS NOT NOW AND HAS NOT BEEN AT ANY TIME DURING THE PERIOD OF ITS SERVICE ON THE ROUTE CAPABLE OF MAINTAINING A SPEED OF 13 KNOTS AT SEA IN ORDINARY WEATHER, ON SUCH BASIS IT APPEARING THAT CONTRACTOR HAS TOTALLY FAILED THROUGHOUT THE PERIOD OF THE VESSEL'S SERVICE ON THE ROUTE TO MAKE GOOD ITS COVENANTS WITH THE GOVERNMENT, THERE HAVE BEEN OVERPAID TO CONTRACTOR ALL MONEYS PAID ON ACCOUNT OF THE OPERATION OF SUCH VESSEL ON SAID ROUTE AND DEMAND SHOULD BE PROMPTLY MADE FOR RETURN OF THE FULL AMOUNT SO PAID CONTRACTOR, REPORT TO THIS OFFICE TO BE MADE ACCORDINGLY.