B-128558, MAR. 26, 1957

B-128558, MAR. 26, 1957

TO STRICKLAND TRANSPORTATION CO., INC.:

REFERENCE IS MADE TO YOUR CLAIM IN THE AMOUNT OF $83.37, FILE STC CLAIM GAO 1108-54, FOR ADDITIONAL FREIGHT CHARGES ALLEGED TO BE OWING FOR THE TRANSPORTATION OF ALUMINUM MACHINERY PARTS FROM WARNER ROBBINS, GEORGIA, TO KELLY AIR FORCE BASE, TEXAS, UNDER GOVERNMENT BILL OF LADING NO. WX- 8501364, DATED SEPTEMBER 24, 1951; AND TO YOUR PROTEST, FILE STC CLAIM NO. 2934-56, TO THE OVERPAYMENT ASSERTED IN THE AMOUNT OF $89.99 AGAINST GOVERNMENT BILL OF LADING NO. WV-1845840, DATED MAY 20, 1953, COVERING SHIPMENTS FROM GADDEN, ALABAMA, TO THE LACKLAND AIR FORCE BASE, TEXAS.

THE RECORD SHOWS THAT YOU ORIGINALLY CLAIMED AND WERE PAID THE AMOUNT OF $1,427.36 ON YOUR BILL NO. 3850--- COMPUTED ON THE BASIS OF A THROUGH RATE OF $5.65 PER HUNDRED POUNDS--- FOR THE SERVICE PERFORMED UNDER BILL OF LADING NO. WX-8501364, AND THE AMOUNT OF $545.55 ON YOUR BILL NO. 4765--- COMPUTED ON THE BASIS OF A THROUGH RATE OF $3.85 PER HUNDRED POUNDS NAMED IN SOUTHERN MOTOR CARRIERS RATE CONFERENCE TARIFF NO. 505, M.F.-ICC NO. 615--- FOR THE SERVICE PERFORMED UNDER BILL OF LADING NO. WV-1845840. THE SUBSEQUENT AUDIT OF YOUR BILLS BY OUR TRANSPORTATION DIVISION, IT WAS DETERMINED THAT IN BOTH CASES THE THROUGH RATES EXCEEDED THE AGGREGATE OF LOCAL RATES BETWEEN POINTS INTERMEDIATE ON ROUTES OVER WHICH THE THROUGH RATES APPLIED. ON THE BASIS OF DECISIONS BY THE INTERSTATE COMMERCE COMMISSION HOLDING THROUGH RATES TO BE PRIMA FACIE UNREASONABLE UNDER SUCH CIRCUMSTANCES, STATEMENTS OF OVERPAYMENT (FORM 1003) WERE ISSUED FOR THE DIFFERENCE BETWEEN CHARGES COMPUTED ON THE BASIS OF THE THROUGH RATE, AND CHARGES COMPUTED ON THE BASIS OF THE LOWEST AGGREGATE OF INTERMEDIATE LOCAL RATES. ON YOUR FAILURE TO REFUND THE FULL AMOUNT OF THE STATED OVERPAYMENTS THE AMOUNT OF $83.37 WAS DEDUCTED FROM MONEY OTHERWISE FOUND DUE IN ORDER TO SATISFY THE OVERPAYMENT STATED AGAINST BILL OF LADING NO. WX-8501364. BY THE STATEMENT OF OVERPAYMENT ISSUED AGAINST BILL OF LADING NO. WV-1845840 YOU WERE ADVISED THAT THE AMOUNT OF $89.99 WOULD ALSO BE ADMINISTRATIVELY COLLECTED BY DEDUCTION OR OTHER AVAILABLE MEANS UNLESS A VOLUNTARY REFUND WAS MADE BY YOU.

YOU NOW CLAIM REFUND OF $83.37 ON BILL OF LADING NO. WX-8501364, AND PROTEST THE ASSERTED OVERPAYMENT OF $89.99 ON BILL OF LADING NO. WV 1845840, CONTENDING THAT IN MOTOR CARRIER CASES THE RULE CONCERNING A THROUGH RATE WHICH EXCEEDS THE AGGREGATE OF INTERMEDIATE LOCAL RATES IS A RULE OF EVIDENCE FOR USE ONLY IN A PROCEEDING BEFORE THE INTERSTATE COMMERCE COMMISSION AND THAT SUCH RULE OF EVIDENCE MAY NOT BE UTILIZED BY A SHIPPER, INCLUDING THE GOVERNMENT, TO AVOID PAYING THE LEGALLY PUBLISHED THROUGH RATE. IN ADDITION, YOU STATE THAT EVEN IF THE INITIAL CARRIER WAS RESPONSIBLE FOR SOME WRONG, THERE IS NO LEGAL AUTHORITY FOR HOLDING YOU, AS DELIVERING CARRIER, LIABLE.

UNDER THE BUDGET AND ACCOUNTING ACT OF 1921, 42 STAT. 24, AS AMENDED, 31 U.S.C. 71, THE GENERAL ACCOUNTING OFFICE IS CHARGED BY LAW WITH THE DUTY OF SETTLING AND ADJUSTING ALL CLAIMS AND ACCOUNTS IN WHICH THE GOVERNMENT OF THE UNITED STATES IS CONCERNED. IN THE PERFORMANCE OF THIS DUTY THE ACCOUNTING OFFICERS OF THE GOVERNMENT ARE BOUND TO SCRUTINIZE CLAIMS AND ACCOUNTS WITH GREAT CARE, AND IT IS THE RIGHT AND DUTY OF THE ACCOUNTING OFFICERS TO REJECT, IN WHOLE OR IN PART, AS THEIR JUDGMENT DICTATES, ALL THOSE CLAIMS AS TO THE VALIDITY OF WHICH THERE EXISTS DOUBTS. SEE CHARLES V. UNITED STATES, 19 C.CLS. 316, 319; LONGWILL V. UNITED STATES, 17 C.CLS. 288, 291. THE INTERSTATE COMMERCE COMMISSION HAS HELD IN MOTOR CARRIER CASES THAT A THROUGH JOINT RATE WHICH EXCEEDS THE AGGREGATE OF INTERMEDIATE LOCAL RATES IS PRIMA FACIE UNREASONABLE AND, THEREFORE, UNLAWFUL UNDER SECTION 216 OF THE INTERSTATE COMMERCE ACT, 49 U.S.C. 316. SEE RITEFIT MFG. CORP. V. HOLLAND MOTOR EXP., 67 MCC 48; STOKELY FOODS, INC. V. FOSTER FREIGHT LINES, 62 MCC 179; VICTORY GRANITE CO. V. CENTRAL TRUCK LINES, INC., 44 MCC 320; KINGAN AND CO. V. OLSON TRANSP. CO., 32 MCC 10. IN THE LIGHT OF THESE DECISIONS, WHICH RAISE, NOT ONLY A DOUBT AS TO THE LAWFULNESS OF THE CHARGES, BUT A PRIMA FACIE CASE FOR THEIR UNLAWFULNESS, THE ACCOUNTING OFFICERS OF THE GOVERNMENT WOULD NOT BE JUSTIFIED IN PERMITTING PAYMENT WITH PUBLIC FUNDS. SEE 32 COMP. GEN. 1. SECTION 322 OF THE TRANSPORTATION ACT OF 1940, 54 STAT. 955, 49 U.S.C. 66, PROVIDES FOR THE PAYMENT OF TRANSPORTATION CHARGES BEFORE AUDIT AND UPON PRESENTATION OF THE BILL, BUT RESERVES TO THE GOVERNMENT THE RIGHT TO DEDUCT THE AMOUNT OF ANY SUBSEQUENTLY DISCOVERED OVERPAYMENT FROM ANY MONEY SUBSEQUENTLY FOUND TO BE DUE THE CARRIER TO WHOM THE ORIGINAL PAYMENT WAS MADE. THE GENERAL ACCOUNTING OFFICE DOES NOT DETERMINE THE REASONABLENESS OF RATES, AND DOES NOT USURP THE FUNCTIONS OF THE INTERSTATE COMMERCE COMMISSION, BUT IN THE PERFORMANCE OF ITS DUTIES UNDER THE BUDGET AND ACCOUNTING ACT, AND SECTION 322 OF THE TRANSPORTATION ACT OF 1940, IT AUDITS TRANSPORTATION BILLS AFTER PAYMENT, IT ASSERTS OVERPAYMENTS IN THE LIGHT OF THE DECISIONS OF THE INTERSTATE COMMERCE COMMISSION, AND IT RECOVERS THE ASSERTED OVERPAYMENTS FROM MONEY OTHERWISE FOUND DUE THE CARRIER. SEE 32 COMP. GEN. 1.

CONDITION NO. 1 ON THE REVERSE OF THE GOVERNMENT BILL OF LADING PROVIDES THAT IN THE ABSENCE OF SPECIFIC STIPULATION TO THE CONTRARY, PAYMENT WILL BE MADE TO THE DESTINATION CARRIER. SINCE THE DESTINATION CARRIER, UNDER SUCH PROVISION, ACTS AS AGENT OF ALL OTHER CARRIERS PARTICIPATING IN A JOINT HAUL FOR THE PURPOSE OF RECEIVING PAYMENT OF THE CHARGES, THE GOVERNMENT IS ENTITLED TO TREAT THE DESTINATION CARRIER AS THE AGENT OF ALL THE CARRIERS FOR THE PURPOSE OF RECOVERING OVERPAYMENTS. SEE 35 COMP. GEN. 358; 31 ID. 605; AND THE COURT CASES CITED. IN THE ABSENCE OF AN AGREEMENT TO THE CONTRARY APPEARING IN THE RECORD, IT IS PRESUMED THAT THE DESTINATION CARRIER RECEIVED PAYMENT, AND THEREFORE, ANY ADJUSTMENTS ARE MADE WITH THE DESTINATION CARRIER.

FINALLY, AS TO BOTH BILLS OF LADING YOU PROTEST THE COMPUTATION OF OVERPAYMENTS BY THE COMBINATION OF INTERMEDIATE LOCAL RATES VIA ROUTES OTHER THAN THE ROUTES OF ACTUAL MOVEMENT. INSTRUCTIONS HAVE BEEN GIVEN TO OUR TRANSPORTATION DIVISION CONCERNING THE MANNER OF THE COMPUTATION OF THE AGGREGATE OF INTERMEDIATE RATES, AND YOU WILL BE NOTIFIED BY THEM OF THE FINAL RESULT.

EXCEPT FOR THE COMBINATION OF INTERMEDIATE RATES, THE ACTION OF OUR TRANSPORTATION DIVISION APPEARS TO BE CORRECT FOR THE REASONS STATED ABOVE, AND IS, ACCORDINGLY, SUSTAINED.