A-84119, MARCH 1, 1937, 16 COMP. GEN. 792

A-84119: Mar 1, 1937

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ARE HEREBY TRANSFERRED TO AND VESTED IN THE COMMISSION. P.I.THE CONTRACTOR IS REQUIRED TO PROVIDE AND OPERATE VESSELS OF CLASS 3 IN THE PERFORMANCE OF THIS SERVICE. COMPENSATION FOR WHICH IS TO BE MADE AT THE RATE OF $6.00 PER NAUTICAL MILE DURING THE FIRST FIVE YEARS OF THE CONTRACT AND $8.00 PER NAUTICAL MILE THEREAFTER. IDENTICAL PROVISIONS ARE CONTAINED IN THE OCEAN MAIL CONTRACT WITH THE DOLLAR STEAMSHIP LINE ON F.O.M. THERE ARE AVAILABLE FOR THIS PLAN FOUR OR FIVE VESSELS OF A TYPE. THE COMMISSION IS WEIGHING THE QUESTION OF POLICY AS TO WHETHER OR NOT TO AUTHORIZE ADDITIONAL VOYAGES UNDER THE PROPOSED PLAN. IT IS ESSENTIAL TO THE FURTHER CONSIDERATION OF THE PROBLEM BY THE COMMISSION TO HAVE FROM YOU AN ANSWER TO THE QUESTION OF WHETHER OR NOT EMERGENCY VOYAGES SUCH AS HEREIN DESCRIBED ARE.

A-84119, MARCH 1, 1937, 16 COMP. GEN. 792

CONTRACTS - OCEAN MAIL CARRIAGE - ADDITIONAL TRIPS BECAUSE OF MARITIME STRIKE CARGO ACCUMULATION CONDITIONS THE PROVISION APPEARING IN OCEAN MAIL CONTRACTS "THAT THE POSTMASTER GENERAL MAY, IN THE CASE OF EMERGENCY, PERMIT THE SUBSTITUTION FOR A PARTICULAR VOYAGE OF A VESSEL," ETC., RELATES SPECIFICALLY TO EMERGENCIES INCIDENT TO THE CARRYING OF THE MAILS AND NOT TO EMERGENCY CONDITIONS IN REGARD TO AN ACCUMULATION OF CARGO BROUGHT ABOUT BY THE RECENT MARITIME STRIKE ON THE PACIFIC COAST, AND ALTHOUGH ADDITIONAL TRIPS MAY BE REQUIRED OF THE CONTRACTOR FOR THE CARRYING OF THE MAILS OR FOR TRADE PURPOSES UNDER THE PROVISIONS OF THE INVOLVED CONTRACTS, NEVERTHELESS, THE VESSELS SO OPERATED MAY NOT BE OF A CLASS OR AT A RATE NOT COVERED BY THE CONTRACTS.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE CHAIRMAN, UNITED STATES MARITIME COMMISSION, MARCH 1, 1937:

THERE HAS BEEN RECEIVED YOUR LETTER OF FEBRUARY 25, 1937, AS FOLLOWS:

THE MERCHANT MARINE ACT OF 1936, SECTION 404, PROVIDES:

"ALL THE POWERS AND DUTIES NOW VESTED BY LAW IN THE POSTMASTER GENERAL, WITH RESPECT TO EXISTING OCEAN MAIL CONTRACTS, EXECUTED PURSUANT TO TITLE IV OF THE MERCHANT MARINE ACT, 1928, ARE HEREBY TRANSFERRED TO AND VESTED IN THE COMMISSION.

"THE OCEAN MAIL CONTRACT ON ROUTE NO. 25 WITH THE DOLLAR STEAMSHIP LINE PROVIDES THAT THE CONTRACTOR SHALL CARRY THE MAILS FROM SAN FRANCISCO TO NAMED PORTS IN JAPAN AND CHINA, AND TO MANILA, P.I.THE CONTRACTOR IS REQUIRED TO PROVIDE AND OPERATE VESSELS OF CLASS 3 IN THE PERFORMANCE OF THIS SERVICE, COMPENSATION FOR WHICH IS TO BE MADE AT THE RATE OF $6.00 PER NAUTICAL MILE DURING THE FIRST FIVE YEARS OF THE CONTRACT AND $8.00 PER NAUTICAL MILE THEREAFTER. THE CONTRACT FURTHER PROVIDES:

"THAT THE POSTMASTER GENERAL MAY, IN THE CASE OF EMERGENCY, PERMIT THE SUBSTITUTION FOR A PARTICULAR VOYAGE OF A VESSEL NOT WITHIN THE PROVISIONS OF THE CONTRACT, EVEN THOUGH NOT CONFORMING TO THE REQUIREMENTS OF SECTION 405 OF THE MERCHANT MARINE ACT, 1928.

"THAT IF MUTUALLY AGREED TO BY THE POSTMASTER GENERAL AND THE CONTRACTOR, THE POST OFFICE DEPARTMENT MAY EXTEND THE SERVICE TO ADDITIONAL PORTS, CURTAIL THE ROUTE TO OMIT PORTS, CHANGE THE SERVICE TO SUBSTITUTE PORTS, OR INCREASE OR REDUCE THE NUMBER OF TRIPS, WITH ALLOWANCE OF NOT EXCEEDING THE CONTRACT RATE FOR THE INCREASED OUTBOUND MILEAGE INVOLVED AND WITH A DEDUCTION AT THE CONTRACT RATE FOR ANY DECREASED OUTBOUND MILEAGE INVOLVED.'

IDENTICAL PROVISIONS ARE CONTAINED IN THE OCEAN MAIL CONTRACT WITH THE DOLLAR STEAMSHIP LINE ON F.O.M. NO. 27.

UPON TERMINATION OF THE MARITIME STRIKE ON THE PACIFIC COAST, THERE HAS BEEN FOUND TO EXIST AN ACCUMULATION OF CARGO FOR SHIPMENT UNDER CONDITIONS WHICH MAY REASONABLY BE DECLARED TO CONSTITUTE AN EMERGENCY. THE SUGGESTION HAS BEEN MADE THAT, AS ONE MEANS OF MEETING THIS EMERGENCY, THE COMMISSION MIGHT AUTHORIZE THE DOLLAR STEAMSHIP LINE TO MAKE ADDITIONAL TRIPS UNDER CONTRACTS NOS. 25 AND 27. THERE ARE AVAILABLE FOR THIS PLAN FOUR OR FIVE VESSELS OF A TYPE, SIZE, AND SPEED SUITABLE FOR MOVING THE CARGO. IT WOULD BE NECESSARY TO REIMBURSE THE CONTRACTOR FOR VOYAGES MADE BY SUCH VESSELS AT THE RATE OF $2.50 PER NAUTICAL MILE.

THE COMMISSION IS WEIGHING THE QUESTION OF POLICY AS TO WHETHER OR NOT TO AUTHORIZE ADDITIONAL VOYAGES UNDER THE PROPOSED PLAN. IT IS ESSENTIAL TO THE FURTHER CONSIDERATION OF THE PROBLEM BY THE COMMISSION TO HAVE FROM YOU AN ANSWER TO THE QUESTION OF WHETHER OR NOT EMERGENCY VOYAGES SUCH AS HEREIN DESCRIBED ARE, IN YOUR OPINION, AUTHORIZED BY THE CONTRACT, SO THAT AN ACCOUNT FOR SUCH A VOYAGE WOULD BE PASSED BY YOU FOR PAYMENT.

THE CONTRACT PROVISION QUOTED IN YOUR LETTER RELATING TO SUBSTITUTION OF VESSELS IN CASES OF EMERGENCY MUST BE CONSTRUED AS RELATING SPECIFICALLY AND ONLY TO EMERGENCIES INCIDENT TO THE CARRYING OF UNITED STATES MAILS AND NOT SUCH EMERGENCY AS APPEARS TO BE INVOLVED IN THE PRESENT MATTER. IT BEING UNDERSTOOD THAT THERE IS NO EMERGENCY EXISTING INSOFAR AS THE TRANSPORTATION OF UNITED STATES MAILS IS CONCERNED THE PROVISION IN QUESTION IS NOT FOR APPLICATION.

AS TO THE FEATURE OF AUTHORIZING AN INCREASE IN THE NUMBER OF TRIPS UNDER THE TWO CONTRACTS UNDER CONSIDERATION IT IS NOTED THAT BOTH CONTRACTS UNDER ROUTES NOS. 25 AND 27 PROVIDE THAT THE CONTRACTOR SHALL TRANSPORT MAILS TO SUCH PORTS AS ARE SPECIFICALLY NAMED IN THE CONTRACTS 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 TWENTY-SIX (26) TRIPS PER ANNUM.' THE POWERS AND DUTIES VESTED IN THE POSTMASTER GENERAL BY THE MERCHANT MARINE ACT OF 1928, HAVING BEEN TRANSFERRED TO YOUR COMMISSION BY SECTION 404 OF THE MERCHANT MARINE ACT OF 1936, THE SCHEDULES OF TRIPS ARE NOW FOR THE CONSIDERATION OF YOUR COMMISSION, AND IN SUCH CIRCUMSTANCES THERE APPEARS TO BE AUTHORITY IN THE COMMISSION NOT ONLY TO MODIFY THE SCHEDULES BUT TO INCREASE THE NUMBER OF TRIPS IF THE COMMISSION FINDS THAT SUCH INCREASE IS NECESSARY, EITHER FOR THE PURPOSE OF CARRYING THE MAILS OR FOR TRADE PURPOSES. HOWEVER, THE CONTRACTS PROVIDE FOR THE OPERATION IN THE PERFORMANCE OF SERVICES THEREUNDER OF VESSELS OF CERTAIN CLASSES AND THE ADDITIONAL TRIPS AUTHORIZED TO BE COVERED BY THE CONTRACT MUST BE OF VESSELS SPECIFICALLY PROVIDED TO BE OPERATED UNDER SUCH CONTRACTS. THERE IS NO AUTHORITY UNDER THE CONTRACTS OR UNDER THE LAW TO OPERATE VESSELS OF A CLASS NOT COVERED BY THE CONTRACTS ON THE BASIS OF COMPENSATION AS PROVIDED FOR IN THE CONTRACT OR OTHERWISE UNDER THE MERCHANT MARINE ACT OF 1928.

IT IS STATED IN YOUR LETTER THAT THERE ARE AVAILABLE FOR THE PLAN PROPOSED, FOUR OR FIVE VESSELS OF A TYPE, SIZE, AND SPEED SUITABLE FOR MOVING THE CARGO. IT IS NOT STATED, HOWEVER, WHETHER SUCH VESSELS ARE OF A TYPE, SIZE, AND SPEED OR OTHERWISE OF A CLASS PROVIDED FOR IN THESE CONTRACTS, BUT THE FURTHER STATEMENT IN YOUR LETTER THAT REIMBURSEMENT TO THE CONTRACTOR FOR VOYAGES MADE BY SUCH VESSELS WOULD BE AT A RATE OF $2.50 PER NAUTICAL MILE, A RATE NOT PROVIDED FOR IN EITHER OF THE CONTRACTS HERE UNDER CONSIDERATION, WOULD APPEAR TO INDICATE THAT THE VESSELS ARE NOT VESSELS AUTHORIZED TO BE OPERATED UNDER SAID CONTRACTS BUT APPARENTLY VESSELS OF CLASS 6 AS DEFINED UNDER SECTIONS 408 AND 409 OF THE MERCHANT MARINE ACT OF 1928, 45 STAT. 694 AND 695. IF SUCH BE THE CASE THERE WOULD APPEAR NO AUTHORITY OF LAW FOR OPERATING THE VESSELS IN QUESTION UNDER THE CONTRACTS AT THE RATE OF COMPENSATION PROPOSED. IT IS, OF COURSE, OPEN TO THE COMMISSION TO ACCOMPLISH THE PURPOSE OTHERWISE IF IT HAS STATUTORY AUTHORITY THEREFOR.