B-120158, B-120561, DEC. 14, 1962

B-120158,B-120561: Dec 14, 1962

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ROBINSON: REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 13. WINTON TRUCK LINES ARE INCONSISTENT WITH AND PRECLUDED BY (1) A COMPROMISE SETTLEMENT REACHED IN MAY OR JUNE 1958. WE HAVE ALSO RECEIVED BY REFERENCE FROM SENATOR RALPH YARBOROUGH AND THE VICE PRESIDENT YOUR LETTERS TO THEM ENCLOSING COPIES OF YOUR LETTER OF NOVEMBER 13. YOU IMPLY THAT SUCH ASSURANCES SHOULD HAVE FOREVER ENDED THE GOVERNMENT'S MAKING FURTHER CLAIMS ON ACCOUNT OF TRANSPORTATION OVERPAYMENTS AGAINST MR. OUR RECORDS SHOW THAT IN THE EARLY PART OF 1958 THERE WERE THE FOLLOWING FOUR SUITS PENDING IN THE UNITED STATES COURT FOR THE WESTERN DISTRICT OF TEXAS. WE WERE ADVISED THAT THE COMPLAINTS WERE DISMISSED WITH PREJUDICE AS A RESULT OF AN OUT-OF -COURT SETTLEMENT UNDER WHICH MR.

B-120158, B-120561, DEC. 14, 1962

TO MR. MAYNARD F. ROBINSON:

REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 13, 1962, TO US IN WHICH YOU IMPLY THAT CERTAIN CIVIL ACTIONS FILED BY THE UNITED STATES DURING 1962 IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS, SAN ANTONIO DIVISION, AGAINST ALAMO MOTOR LINES, AND T. W. WHEELER DOING BUSINESS IN THE NAMES OF ROBERTSON AUTO TRANSPORT CO. AND WINTON TRUCK LINES ARE INCONSISTENT WITH AND PRECLUDED BY (1) A COMPROMISE SETTLEMENT REACHED IN MAY OR JUNE 1958, OF CERTAIN EARLIER SUITS BETWEEN THE PARTIES AND (2) JUDGMENTS ENTERED IN 1955 IN CIVIL ACTIONS 1883 AND 1884 IN THE DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS, SAN ANTONIO DIVISION. WE HAVE ALSO RECEIVED BY REFERENCE FROM SENATOR RALPH YARBOROUGH AND THE VICE PRESIDENT YOUR LETTERS TO THEM ENCLOSING COPIES OF YOUR LETTER OF NOVEMBER 13, 1962, TO OUR OFFICE. YOU INDICATE IN THOSE LETTERS THAT YOU RECEIVED ASSURANCES IN 1958 THAT THE TRANSPORTATION AUDITS HAD BEEN COMPLETED AND THAT "THERE WOULD BE NO HEREAFTER (REOPENING) IN THE MATTER OF FOUR PENDING LAWSUITS" UPON PAYMENT BY MR. WHEELER OF THE SUM OF APPROXIMATELY $33,000 ACCEPTED IN THE COMPROMISE REFERRED TO ABOVE. YOU IMPLY THAT SUCH ASSURANCES SHOULD HAVE FOREVER ENDED THE GOVERNMENT'S MAKING FURTHER CLAIMS ON ACCOUNT OF TRANSPORTATION OVERPAYMENTS AGAINST MR. WHEELER AND ASK WHETHER OUR OFFICE ,MEANT WHAT IT SAID WHEN MR. WHEELER PAID $33,000.' IN YOUR LETTER OF NOVEMBER 13, 1962, YOU REFER TO OUR LETTER OF MARCH 24, 1958, B 111239, TO THE THEN SENATOR LYNDON B. JOHNSON, AS HAVING SOME BEARING ON YOUR CONTENTIONS.

OUR RECORDS SHOW THAT IN THE EARLY PART OF 1958 THERE WERE THE FOLLOWING FOUR SUITS PENDING IN THE UNITED STATES COURT FOR THE WESTERN DISTRICT OF TEXAS, SAN ANTONIO DIVISION:

(1) T. W. WHEELER D/B/A WINTON TRUCK LINES V. UNITED STATES, CIVIL ACTION 2091--- $24,924.54.

(2) UNITED STATES V. T. W. WHEELER D/B/A WINTON TRUCK LINES, CIVIL ACTION 2101--- $67,228.69.

(3) UNITED STATES V. T. W. WHEELER D/B/A ROBERTSON AUTO TRANSPORT CO., CIVIL ACTION 2398--- $$33,238.74.

(4) T. W. WHEELER D/B/A ROBERTSON AUTO TRANSPORT CO. V. UNITED STATES, CIVIL ACTION 2336--- $447.

YOU REPRESENTED MR. WHEELER IN THESE MATTERS AND MADE AN OFFER TO COMPROMISE THE FOUR SUITS BY PAYMENT OF $25,000 UPON WHICH THE DEPARTMENT OF JUSTICE ASKED FOR OUR VIEWS. IN OUR LETTER OF MARCH 24, 1958, B- 111239, TO SENATOR JOHNSON, WHO HAD MADE INQUIRY AS TO THE STATUS OF THE MATTER ON YOUR BEHALF, WE REPORTED THAT "THE OFFER OF $25,000 IN SETTLEMENT OF OUR CLAIMS TOTALING MORE THAN $95,000 SEEMS INADEQUATE" AND THAT WE ACCORDINGLY HAD RECOMMENDED TO THE DEPARTMENT OF JUSTICE THAT THE PRESENT OFFER BE REJECTED. AFTER FURTHER NEGOTIATIONS, WE WERE ADVISED THAT THE COMPLAINTS WERE DISMISSED WITH PREJUDICE AS A RESULT OF AN OUT-OF -COURT SETTLEMENT UNDER WHICH MR. WHEELER PAID $33,000 PLUS COSTS AND EXECUTED A WAIVER OF CERTAIN TAX BENEFITS AND THAT THE DEPARTMENT OF JUSTICE WAS TREATING THE SUITS AS CLOSED. THERE IS NOTHING IN OUR RECORDS TO INDICATE THE $33,000 SETTLEMENT WAS TO COVER ANYTHING BUT THE PARTICULAR ITEMS IN SUIT. ON THE CONTRARY THERE IS INCLUDED IN OUR FILE A COPY OF A LETTER DATED APRIL 7, 1958, FILE GCD:PLC 78-76-23 ET AL. FROM THE CHIEF, GOVERNMENT CLAIMS SECTION, DEPARTMENT OF JUSTICE, TO YOU, WHEREIN IT IS STATED "THE SCOPE OF ANY SETTLEMENT MUST BE CONFINED TO SETTLEMENT OF THE SPECIFIC CLAIMS BEING LITIGATED IN THE ABOVE CAPTIONED CASES" (CIVIL ACTIONS 2091, 2101, 2398 AND 2336). WE HAVE NO RECORD OF ANY ADVICE HAVING BEEN FURNISHED YOU THAT THE TRANSPORTATION AUDIT (WHICH OF COURSE AS TO RECENT SHIPMENTS IS CURRENTLY BEING MADE) AS TO ANY PARTICULAR PERIOD HAD BEEN COMPLETED. ALSO, EVEN ASSUMING INFORMAL ADVICE WAS FURNISHED BY A REPRESENTATIVE OF OUR OFFICE THAT THE AUDIT THROUGH A PARTICULAR PERIOD WAS COMPLETE OR SUBSTANTIALLY COMPLETE, THERE WOULD BE NO PROPER BASIS FOR INFERRING THAT NO OVERCHARGES BY A PARTICULAR CARRIER HAD THEN BEEN DISCOVERED IN THE AUDIT OR MIGHT NOT LATER BE REVEALED. ACCORDINGLY, IT IS OUR VIEW THAT THE COMPROMISE SETTLEMENT REACHED IN MAY OR JUNE 1958, IS NOT INCONSISTENT WITH NOR DID IT PRECLUDE THE FILING OF SUITS IN 1962 BETWEEN THE PARTIES THERETO EXCEPT AS TO ITEMS WHICH HAD BEEN INCLUDED IN THE FOUR SUITS INVOLVED AND WE HAVE BEEN ADVISED THAT THE ITEMS INVOLVED IN THE 1962 SUITS INVOLVE OVERPAYMENTS NOT INCLUDED IN THE FOUR SUITS SETTLED IN 1958.

AS TO YOUR SECOND CONTENTION THAT CERTAIN JUDGMENTS IN CIVIL ACTIONS 1883 AND 1884 PRECLUDED THE FILING OF THE ACTIONS IN 1962 AGAINST THE ALAMO TRUCK LINES AND T. W. WHEELER, OUR RECORDS SHOW THAT IN 1954 THERE WERE PENDING IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS, SAN ANTONIO DIVISION THE FOLLOWING ACTIONS, ALAMO MOTOR LINES INC., V. UNITED STATES, CIVIL ACTION NO. 1883; LEE WAY MOTOR FREIGHT INC., V. UNITED STATES, CIVIL ACTION NO. 1885; AND ROBERTSON AUTO TRANSPORT CO. V. UNITED STATES, CIVIL ACTION NO. 1884. THE RECORD SHOWS THAT YOU WERE THE ATTORNEY FOR ALL THREE PLAINTIFFS. THE GENERAL ISSUE PRESENT IN THE THREE CASES WAS WHETHER CERTAIN MILITARY MOTOR VEHICLES SHIPPED EQUIPPED WITH MUD AND SNOW TIRES WERE PROPERLY CLASSIFIED AS FREIGHT MOTOR VEHICLES INCLUDING TRACTORS IN ITEM 93,250 OF NATIONAL FREIGHT CLASSIFICATION 9, WHICH TOOK A HIGHER RATE AS CONTENDED FOR BY THE PLAINTIFFS OR AS MOTOR VEHICLES, DUMPING OR HAULING, WITH LUG WHEELS, OR TRACTOR LUG TIRES IN ITEM 93300 OF THE CLASSIFICATION AS CONTENDED FOR BY THE DEFENDANT WHICH TOOK A LOWER FREIGHT RATE.

THE DISPUTED ISSUE WAS PRESENTED TO THE COURT UNDER A STIPULATION THAT IF JUDGMENT SHOULD BE AWARDED PLAINTIFF IN THE LEE WAY MOTOR FREIGHT CASE, THE AMOUNT OF THE JUDGMENTS IN ALL THREE CASES WOULD BE DETERMINED BY THE PARTIES UPON APPLICATION OF THE CHARGE BASIS FOUND PROPER BY THE COURT. THE DECISION WAS AGAINST THE GOVERNMENT ON THE BASIC ISSUE AND THE CARRIERS THEN SOUGHT AN AGREEMENT THAT THE AMOUNT SUED FOR IN THE RESPECTIVE COMPLAINTS COULD BE ENTERED AS THE AMOUNT OF THE JUDGMENTS SO THAT THE CASES COULD BE CLOSED AND PROCEDURES INSTITUTED TO OBTAIN AN APPROPRIATION FOR PAYMENT OF THE JUDGMENTS. AT THE TIME OF TRIAL THE GOVERNMENT'S RECORDS HAD NOT BEEN COMPLETELY ANALYZED, REPRESENTATIVE SHIPMENTS HAVING BEEN USED FOR TRIAL PURPOSES. THEREFORE, IT WAS IMPOSSIBLE TO VERIFY THE AMOUNT ALLEGEDLY DUE BASED ON THE AVAILABLE RECORDS. IN THESE CIRCUMSTANCES, AS EVIDENCED BY YOUR LETTERS OF JUNE 7, 1955, ADDRESSED TO MR. W. J. MASSIE, THEN AN ASSISTANT GENERAL COUNSEL OF THIS OFFICE, THE UNDERSTANDING WAS THAT THE GOVERNMENT WOULD CONSENT TO ENTRIES OF JUDGMENTS BASED ON CARRIER COMPUTATIONS AND THAT ANY AMOUNTS FOUND IN THE REAUDIT TO HAVE BEEN OVERPAID THE CARRIERS WOULD BE REFUNDED. THE UNDERSTANDING AS TO THE REFUND OF OVERPAYMENTS BY THE CARRIERS WAS MADE A PART OF MR. MASSIE'S LETTER OF AUGUST 24, 1955, B- 117460, B 120157, B-120158 TO YOU. YOUR LETTER OF AUGUST 29, 1955, ACKNOWLEDGED RECEIPT OF THE LETTER OF AUGUST 24, 1955 AND STATED IN PERTINENT PART,

"AS I NOW UNDERSTAND IT, LEE WAY IS CLEAN--- THAT IS, THERE ARE NO AMOUNTS ASSERTED, ONE WAY OR THE OTHER, INSOFAR AS LEE WAY IS CONCERNED. YOUR LETTER OF THE 24TH SETS OUT THE ROBERTSON MATTER IN DETAIL, AND IS BEING TURNED TO THE AUDITORS. I WILL SAY, HOWEVER, THAT YOUR UNDERSTANDING OF OUR AGREEMENT IS CORRECT AND THAT UPON SETTLEMENT BETWEEN ROBERTSON IN THE MATTER OF THE JUDGMENT AND MYSELF AS ATTORNEY, THAT THE SUM OF $3,266.47 WILL BE PLACED IN A SPECIAL ACCOUNT AND PAID AS SOON AS I CAN GET A REPORT FROM THE AUDITOR. I DO NOT, HOWEVER, HAVE A STATEMENT OF THE ALAMO DISCREPANCIES, AND THAT WILL BE HANDLED IN EXACTLY THE SAME MANNER, IF SATISFACTORY TO YOU.'

FURTHER STATEMENTS OF MUTUAL UNDERSTANDING AND AGREEMENT OF THE REFUND TO HAVE BEEN MADE OF THE OVERPAYMENTS ARE CONTAINED IN YOUR LETTERS OF SEPTEMBER 11, 1955, ADDRESSED TO MR. W. J. MASSIE, IN WHICH YOU STATE "I AM HAVING PREPARED SUFFICIENT INFORMATION FROM THAT LETTER WHEREBY IF--- AS YOU EMPHASIZE--- I AM "UNABLE TO SUSTAIN" THE CONTENTION OF ROBERTSON AUTO TRANSPORT COMPANY, WE WILL OWE YOU SOME MONEY ON THE ORIGINAL JUDGMENT, THE MAXIMUM OF WHICH $3,972.07. I ENCLOSE A NON-NEGOTIABLE INFORMATIONAL COPY OF CASHIER'S CHECK NO. 88426, ISSUED BY THE MISSION CITY BANK, IN THE SUM OF $3,927.07. I ENCLOSE A NON-NEGOTIABLE INFORMATIONAL COPY OF CASHIER'S CHECK NO. 88426, ISSUED BY THE MISSION CITY BANK IN THE SUM OF $3,927.07, PAYABLE TO MAYNARD F. ROBINSON, TRUSTEE, AND WHICH COPY SHOWS THE CHECK TO HAVE BEEN PURCHASED JOINTLY BY MAYNARD ROBINSON AND T. W. WHEELER.' ALSO CONCERNING THE ALAMO AGREEMENT, YOU STATED "I CONSIDER THE AGREEMENT MADE AS COUNSEL A TRUST AND WILL RESERVE ON THE SAME BASIS AS IN THE ROBERTSON CASE, A SUFFICIENT AMOUNT TO ABIDE BY OUR AGREEMENT BOTH TO THE LETTER AND IN THE SPIRIT IN WHICH IT WAS MADE.'

BY LETTERS OF AUGUST 24, 1955, B-117460, B-120157 AND B-120158 AND DECEMBER 1, 1955, B-120157, YOU WERE ADVISED THAT WE WERE AWAITING YOUR REPORT AS TO THE ADJUSTMENTS TO BE MADE IN ALAMO AND ROBERTSON CASES. RESPONSE WAS MADE TO THESE LETTERS. FURTHERMORE, YOU DID NOT RESPOND TO OUR LETTERS OF FEBRUARY 20, 1959 AND FEBRUARY 24, 1960, IN WHICH FURTHER REQUESTS WERE MADE UPON YOU FOR THE REFUNDS DUE, THAT IS, $3,927.07 IN THE ROBERTSON CASE AND $1,420.69 IN THE ALAMO CASE. A DEMAND FOR THE PAYMENT OF THE REFUNDS DUE IN THE ALAMO AND ROBERTSON CASES WERE MADE ALSO UPON MR. T. W. WHEELER. NO RESPONSE WAS RECEIVED FROM MR. WHEELER.

IN VIEW OF YOUR FAILURE TO COMPLETE THE PAYMENT AGREEMENTS AND TO RESPOND TO THE NUMEROUS REQUESTS FOR REFUNDS OF $1,420.69 AND $3,972.07, RESPECTIVELY OWED THE UNITED STATES IN THE CASE OF ALAMO MOTOR LINES, INC., V. UNITED STATES, CIVIL ACTION NO. 1883, AND ROBERTSON AUTO TRANSPORT COMPANY V. UNITED STATES, CIVIL ACTION NO. 1884, BOTH CASES WERE THEN REFERRED TO THE DEPARTMENT OF JUSTICE FOR COLLECTION.

A SUIT TO RECOVER THE OVERPAYMENT OF $1,420.69 DUE THE UNITED STATES WAS FILED IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS, UNITED STATES V. ALAMO MOTOR LINES, INC., CIVIL ACTION NO. 3129. IT IS OUR UNDERSTANDING THAT THE CASE WAS DISMISSED BECAUSE THE CORPORATION, ALAMO MOTOR LINES, INC., WAS DISSOLVED ON JUNE 2, 1958. THE OVERPAYMENT OF $1,420.69, LESS CREDITS OF $90.75 AND $564.36, NET $765.58 IS STILL A DEBT OWED THE UNITED STATES AND WE HAVE SUGGESTED TO THE DEPARTMENT OF JUSTICE THAT CONSIDERATION SHOULD BE GIVEN TO THE COLLECTION OF THIS INDEBTEDNESS FROM T. W. WHEELER, WHO APPEARS TO HAVE HAD THE CONTROLLING FINANCIAL INTEREST IN THE OPERATION OF THE CORPORATION, ALAMO MOTOR LINES, INC., IN 1955, WHEN PAYMENT OF THE JUDGMENT WAS MADE TO YOU WITH THE MUTUAL UNDERSTANDING THAT ANY OVERPAYMENT WAS TO BE REFUNDED.

A SUIT TO RECOVER THE OVERPAYMENT OF $3,972.07 DUE THE UNITED STATES WAS FILED IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS, UNITED STATES V. ROBERTSON AUTO TRANSPORT CO., CIVIL ACTION NO. 3130. ON NOVEMBER 9, 1962, THE CASE OF UNITED STATES V. T. W. WHEELER, D/B/A WINTON TRUCK LINES, CIVIL ACTION NO. 3196, WAS FILED BY THE DEPARTMENT OF JUSTICE IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS, SAN ANTONIO DIVISION.

THE PAYMENT OF THE JUDGMENTS IN CIVIL ACTIONS 1883 AND 1884 UNDER THE UNDERSTANDINGS REFERRED TO ABOVE THAT REFUND WOULD BE MADE OF THE AMOUNT PAID BUT NOT DUE CLEARLY WOULD NOT PRECLUDE THE FILING OF THE 1962 ACTIONS MADE NECESSARY BY YOUR FAILURE TO MAKE THE REFUNDS AGREED UPON.

SINCE THE OVERPAYMENTS INVOLVED HAVE BEEN REFERRED FOR COLLECTION TO THE DEPARTMENT OF JUSTICE, WHICH DEPARTMENT IS RESPONSIBLE FOR THE CURRENT PROCEEDINGS, ANY ARGUMENT OR PROPOSAL THAT YOU MAY HAVE CONCERNING SETTLEMENT OF THESE CASES SHOULD BE PRESENTED TO THE UNITED STATES ATTORNEY, SAN ANTONIO, TEXAS, FOR HIS CONSIDERATION.

WE TRUST THAT WHAT IS SAID ABOVE WILL SATISFY YOU THAT OUR OFFICE WHICH IS CHARGED BY LAW, 31 U.S.C. 71 AND 93, WITH THE SETTLEMENT OF CLAIMS BOTH IN FAVOR OF AND AGAINST THE UNITED STATES AND THE SUPERINTENDENCE OF DEBTS CERTIFIED TO BE DUE THE UNITED STATES, IN REPORTING THE OVERPAYMENTS TO THE DEPARTMENT OF JUSTICE FOR COLLECTION WAS MERELY CARRYING OUT ITS DUTIES IN THE INTERESTS OF YOU AND OTHER TAXPAYERS AND, OF COURSE, SUCH ACTION DOES NOT PRECLUDE YOUR CONTESTING, IF YOU CHOOSE TO DO SO, IN THE COURT ACTIONS, THE PROPRIETY OF OUR DETERMINATIONS THAT YOUR CLIENT IS INDEBTED TO THE UNITED STATES IN THE AMOUNTS SUED FOR OR AS OTHERWISE INDICATED HEREIN.