B-128721, NOV. 2, 1956

B-128721, NOV. 2, 1956

TO SUNSET MOTOR LINES:

REFERENCE IS MADE TO YOUR LETTER OF JULY 19, 1956, REQUESTING REVIEW OF OUR SETTLEMENT CERTIFICATE DATED JUNE 1, 1956, DISALLOWING CLAIM NO. 11495 BY SUNSET MOTOR LINES FOR $186 AS ADDITIONAL CHARGES ALLEGED TO BE DUE FOR THE TRANSPORTATION OF 307 CARTONS OF PRINTING PAPER, NOT NEWSPRINT, FROM LOS ANGELES, CALIFORNIA, TO RANDOLPH FIELD, TEXAS, UNDER GOVERNMENT BILL OF LADING NO. AF-971187, IN OCTOBER 1951.

THIS SHIPMENT WAS TENDERED WITHOUT DETAILED ROUTING INSTRUCTIONS TO SOUTHWESTERN FREIGHT LINES--- ADOPTED BY T.I.M.E., INC.--- AND YOU PARTICIPATED IN THE JOINT MOVEMENT AS DELIVERING CARRIER. FOR THE INVOLVED SERVICES, YOU CLAIMED AND WERE PAID $720 BASED ON THE USE OF A THROUGH RATE OF $3.60 PER 100 POUNDS ON A MINIMUM WEIGHT OF 20,000 POUNDS. IN THE AUDIT OF THE CHARGES PAID, OUR TRANSPORTATION DIVISION DETERMINED THAT LESSER CHARGES, COMPUTED AT $2.67 PER 100 POUNDS, WOULD HAVE RESULTED FROM THE USE OF A COMBINATION OF LOCAL RATES MADE OVER EL PASO, TEXAS. OUR TRANSPORTATION DIVISION REPORTS THAT THIS APPEARS TO BE THE ACTUAL ROUTING SINCE EL PASO IS THE ONLY COMMON INTERCHANGE POINT NAMED IN ROCKY MOUNTAIN MOTOR TARIFF BUREAU TRANSCONTINENTAL ROUTING GUIDE NO. 28, MF-I.C.C. NO. 54, FOR YOU AND T.I.M.E., INC. A NOTICE OF OVERPAYMENT WAS ISSUED AND UPON YOUR FAILURE TO REFUND THE $186 REQUESTED, THAT AMOUNT WAS DEDUCTED FROM MONIES OTHERWISE DUE.

IN YOUR REQUEST FOR REVIEW YOU OBJECT TO THE USE OF COMBINATION RATES WHEN IT IS FOUND THAT THEIR APPLICATION PRODUCES A LOWER CHARGE THAN THAT BASED ON THE JOINT THROUGH RATE. YOU ASSERT THAT ONLY IN A PROPER PROCEEDING BEFORE THE INTERSTATE COMMERCE COMMISSION CHALLENGING A THROUGH RATE ESTABLISHED BY INTERSTATE MOTOR CARRIERS, IN THE ABSENCE OF EVIDENCE CONCERNING THE REASONABLENESS OF AN ASSAILED THROUGH (JOINT) RATE, CAN A JOINT RATE BE PRESUMED TO BE UNREASONABLE TO THE EXTENT THAT IT EXCEEDS THE CORRESPONDING AGGREGATE OF INTERMEDIATE RATES. YOU ALSO OBJECT TO OUR DEDUCTING THE TOTAL AMOUNT OF THE OVERPAYMENT FROM AMOUNTS OTHERWISE DUE THE DELIVERING CARRIER BECAUSE THE OVERPAYMENT DEDUCTED IS "GROSSLY DISPROPORTIONATE TO THE AMOUNT OF REVENUE ORIGINALLY RECEIVED BY SUCH CARRIER FROM THE SHIPMENT INVOLVED.'

THE GENERAL ACCOUNTING OFFICE, IN THE DISCHARGE OF THE DUTY IMPOSED UPON IT BY THE BUDGET AND ACCOUNTING ACT OF 1921, 31 U.S.C. 71, IS GOVERNED IN THE AUDIT OF TRANSPORTATION ACCOUNTS BY DULY FILED AND PUBLISHED TARIFF RATES, WHERE APPLICABLE, EXCEPT IN SUCH INSTANCES AS THOSE IN WHICH THE INTERSTATE COMMERCE COMMISSION MAY HAVE MADE A DETERMINATION ESTABLISHING THE UNREASONABLENESS OF SUCH APPLICABLE TARIFF RATES, OR WHERE SUCH APPLICABLE TARIFF RATES ARE PRIMA FACIE UNREASONABLE IN THE LIGHT OF ESTABLISHED PRINCIPLES ENUNCIATED BY THE COMMISSION. OUR OFFICE DOES NOT MAKE DETERMINATIONS AS TO THE REASONABLENESS OR UNREASONABLENESS OF TARIFF RATES. WE DO, HOWEVER, DETERMINE WHETHER THE FACTS AND CIRCUMSTANCES IN CONNECTION WITH A GIVEN CLAIM SHOW THAT THE CLAIM IS BASED ON A RATE APPLIED IN SITUATIONS WHERE SIMILAR RATES IN SIMILAR CIRCUMSTANCES HAVE BEEN DETERMINED BY THE COMMISSION TO BE PRIMA FACIE UNREASONABLE. SANCTION THE AVAILABILITY OF PUBLIC FUNDS FOR PAYMENT OF CHARGES CLAIMED IN SUCH SITUATIONS WOULD APPEAR TO VIOLATE OUR DUTY TO CONSIDER SUBSTANTIVE DEFENSES IN LAW IN THE SETTLEMENT OF CLAIMS.

IN THE PRESENT CASE IT IS OUR DUTY TO DECIDE WHETHER APPROPRIATED FUNDS ARE PROPERLY AVAILABLE FOR THE PAYMENT OF CHARGES ON THE BASIS OF A THROUGH RATE WHEN WE KNOW THAT IN PROCEEDINGS BEFORE THE INTERSTATE COMMERCE COMMISSION INVOLVING A SIMILAR SITUATION SUCH RATE HAS BEEN FOUND PRESUMPTIVELY UNREASONABLE TO THE EXTENT THAT IT EXCEEDS THE CORRESPONDING AGGREGATE OF INTERMEDIATE RATES. SEE KINGAN AND COMPANY V. OLSON TRANSPORTATION COMPANY, 32 M.C.C. 10; VICTORY GRANITE COMPANY, V. CENTRAL TRUCK LINES, 44 M.C.C. 320, 324; AND STOKELY FOODS, INC. V. FOSTER FREIGHT LINES, INC., 62 M.C.C. 179, 182. THOSE CASES, CONTRARY TO YOUR ASSERTION, DO NOT SPECIFICALLY REQUIRE AN "ABSENCE OF EVIDENCE CONCERNING THE REASONABLENESS OF THE ASSAILED THROUGH RATE" AS A CONDITION PRECEDENT TO THE PRESUMPTION OF UNREASONABLENESS. IN ANY CASE INVOLVING CLAIMS OF DOUBTFUL VALIDITY THE ACCOUNTING OFFICERS OF THE GOVERNMENT ARE REQUIRED TO RESOLVE THE DOUBT IN FAVOR OF THE GOVERNMENT. IN LONGWILL AND JOHNSON'S CASES, 17 C.CLS. 288, 291, THE COURT SAID:

"THE ACCOUNTING OFFICERS OF THE TREASURY ARE IN DUTY BOUND TO SCRUTINIZE CLAIMS AND ACCOUNTS WITH GREAT CARE, AS IS THEIR CUSTOM; AND IT IS THE UNDOUBTED RIGHT AND DUTY OF THE COMPTROLLERS * * * WHO ALONE OF THE ACCOUNTING OFFICERS HAVE AUTHORITY TO DECIDE THEREON, TO REJECT, IN WHOLE OR IN PART, AS THEIR JUDGMENT DICTATES, ALL THOSE CLAIMS WHICH THEY HAVE REASONABLE CAUSE TO SUSPECT TO BE TAINTED WITH FRAUD, OR TO WHICH THEY BELIEVE THERE MAY BE SUBSTANTIAL DEFENSES IN LAW, OR AS TO THE VALIDITY OF WHICH THEY ARE IN DOUBT.'

AND IN CHARLES V. UNITED STATES, 19 C.CLS. 316, 319:

"WHEN, IN THE COURSE OF THE EXAMINATION OF ACCOUNTS IN THE DEPARTMENTS, SUSPICIONS ARE AROUSED OR DOUBTS ARE ENTERTAINED AS TO THE VALIDITY OF THE DEMANDS OF CLAIMANTS, THE PARTIES MAY BE SENT TO THIS COURT TO PROVE THEIR CASES UNDER THE RULES AND FORMS OF LAW, UPON LEGAL AND COMPETENT EVIDENCE, OR THEIR DEMANDS MAY BE REJECTED ALTOGETHER, LEAVING THE CLAIMANTS TO PROSECUTE THEM HERE UPON THEIR VOLUNTARY PETITIONS, IF THEY SO DESIRE. THAT IS THE MAIN PROTECTION WHICH THE ACCOUNTING OFFICERS CAN SECURE FOR THEMSELVES AND FOR THE GOVERNMENT IN THE CASE OF CLAIMS OF DOUBTFUL VALIDITY IN FACT OR IN LAW * * *.'

IN THE INSTANT MATTER THERE APPEARS NOT MERELY A DOUBT AS TO THE VALIDITY OF THE CHARGES CLAIMED, BUT RATHER A PRESUMPTION OF PARTIAL INVALIDITY ARISING FROM THE PRIMA FACIE UNREASONABLENESS OF THE RATE EMPLOYED AS A BASIS FOR THE CLAIM. UNDER THE CIRCUMSTANCES, THEREFORE, IT DOES NOT APPEAR THAT WE WOULD BE JUSTIFIED IN HOLDING APPROPRIATED FUNDS TO BE AVAILABLE FOR THE PAYMENT OF THE TOTAL CHARGES CLAIMED.

SECTION 322 OF THE TRANSPORTATION ACT OF 1940, 49 U.S.C. 66, PROVIDES THAT:

"PAYMENT FOR TRANSPORTATION OF UNITED STATES * * * FOR OR ON BEHALF OF THE UNITED STATES BY ANY COMMON CARRIER * * * 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 OVERPAYMENT TO ANY SUCH CARRIER FROM ANY AMOUNT SUBSEQUENTLY FOUND TO BE DUE SUCH CARRIER.'

SINCE ONE CONDITION OF THE INVOLVED BILL OF LADING PROVIDED THAT "PAYMENT WILL BE MADE TO THE LAST CARRIER, UNLESS OTHERWISE SPECIFICALLY STIPULATED," AND SINCE YOU WERE SO PAID AS THE LAST CARRIER, OUR DEDUCTION ACTION APPEARS TO BE PROPER.

ACCORDINGLY, SINCE OUR SETTLEMENT IS CONSISTENT WITH (WORD ILLEGIBLE) VIEW AND IS NOT OTHERWISE IN ERROR WE WOULD NOT BE WARRANTED IN MODIFYING IT. ..END :