B-128799, DEC. 4, 1957

B-128799: Dec 4, 1957

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TO ERIE RAILROAD COMPANY: REFERENCE IS MADE TO YOUR LETTER. THE SHIPMENT WAS TENDERED TO THE CARRIER FOR MOVEMENT FROM LOS ANGELES. FOR THIS SERVICE THE ERIE RAILROAD COMPANY CLAIMED AND WAS PAID $504.69. THE ALLOWABLE CHARGES WERE $192.87. WHICH WAS RECOVERED BY ADMINISTRATIVE SETOFF IN MAY 1952. - WHICH WAS TRANSPORTED FROM SAN BERNARDINO. THE PROPERTY WAS SECURED BY THE UNITED NATIONS FOR THE MINISTERIO DE DEFENSA NATIONAL. WAS REQUISITIONED UNDER THE LEND-LEASE ACT OF MARCH 11. FOR THIS TRANSPORTATION SERVICE THE ERIE RAILROAD COMPANY CLAIMED AND WAS PAID FREIGHT CHARGES IN THE AMOUNT OF $330.12. THE ALLOWABLE FREIGHT CHARGES WERE $220.07. WHICH WAS RECOVERED BY ADMINISTRATIVE SETOFF IN MAY 1952.

B-128799, DEC. 4, 1957

TO ERIE RAILROAD COMPANY:

REFERENCE IS MADE TO YOUR LETTER, WRITTEN UNDER FILE 77-2736-A-6/46, IN WHICH YOU REQUEST REVIEW OF THE SETTLEMENT DATED FEBRUARY 1, 1954, WHICH DISALLOWED YOUR CLAIM, PER BILL NO. 77-2736-A-6/46, FOR $96.23 AND $108.05, REPRESENTING ADDITIONAL FREIGHT CHARGES CLAIMED TO BE DUE FOR THE TRANSPORTATION SERVICES PERFORMED UNDER GOVERNMENT BILLS OF LADING NOS. WV -1396311 AND WV-1460399, RESPECTIVELY.

AS TO YOUR CLAIM ON GOVERNMENT BILL OF LADING NO. WV-1396311, ISSUED JANUARY 10, 1946, THE RECORD SHOWS THAT THIS BILL OF LADING COVERED A SHIPMENT OF METAL AIRPLANE PARTS FOR USE ON A UNITED STATES B-24 LIBERATOR AIRCRAFT. THE SHIPMENT WAS TENDERED TO THE CARRIER FOR MOVEMENT FROM LOS ANGELES, CALIFORNIA, TO NEW YORK CITY FOR DELIVERY TO THE UNITED KINGDOM, THE LATTER HAVING REQUISITIONED THE SUBJECT MATERIAL UNDER THE LEND-LEASE ACT OF MARCH 11, 1941, BY REQUISITION NO. UK-474-VJ. FOR THIS SERVICE THE ERIE RAILROAD COMPANY CLAIMED AND WAS PAID $504.69, COMPUTED ON THE BASIS OF THE GROSS COMMERCIAL RATE OF $12.22 PER HUNDRED POUNDS. ON AUDIT OF THE PAYMENT VOUCHER, OUR OFFICE COMPUTED THE FREIGHT CHARGES ON THE BASIS OF A RATE OF $7 PER HUNDRED POUNDS, BUT REDUCED THE RATE TO $4.66994 PER HUNDRED POUNDS BY TAKING DEDUCTIONS FOR LAND GRANT UNDER SECTION 321 (A) OF THE TRANSPORTATION ACT OF 1940, 54 STAT. 898, 954,49 U.S.C. 65, 1940 EDITION. COMPUTED ON THAT BASIS, THE ALLOWABLE CHARGES WERE $192.87, RESULTING IN AN OVERPAYMENT OF $311.82, WHICH WAS RECOVERED BY ADMINISTRATIVE SETOFF IN MAY 1952.

GOVERNMENT BILL OF LADING NO. WV-1460399 COVERED A SHIPMENT OF GOVERNMENT -OWNED FREIGHT--- DESCRIBED AS HAND CARTS AND IDENTIFIED IN A REPORT FROM THE DEPARTMENT OF THE ARMY AS DOLLY ASSEMBLIES FOR THE TRUCKING OF AIRPLANE PARTS--- WHICH WAS TRANSPORTED FROM SAN BERNARDINO, CALIFORNIA, TO NEW YORK CITY, FOR DELIVERY TO BOLIVIA. THE PROPERTY WAS SECURED BY THE UNITED NATIONS FOR THE MINISTERIO DE DEFENSA NATIONAL, LA PAZ, AND WAS REQUISITIONED UNDER THE LEND-LEASE ACT OF MARCH 11, 1941, REQUISITION NO. BL-11/VJ). FOR THIS TRANSPORTATION SERVICE THE ERIE RAILROAD COMPANY CLAIMED AND WAS PAID FREIGHT CHARGES IN THE AMOUNT OF $330.12, COMPUTED ON THE BASIS OF THE GROSS COMMERCIAL RATE WITHOUT DEDUCTION FOR LAND GRANT. ON AUDIT OF THE PAYMENT VOUCHER, OUR OFFICE COMPUTED THE FREIGHT CHARGES ON THE BASIS OF THE SAME COMMERCIAL RATE, BUT TOOK DEDUCTIONS FOR LAND GRANT UNDER SECTION 321 (A) OF THE TRANSPORTATION ACT OF 1940, WHICH PRODUCED A NET LAND-GRANT RATE OF $6.1685. ON THAT BASIS, THE ALLOWABLE FREIGHT CHARGES WERE $220.07, RESULTING IN AN OVERPAYMENT OF $108.05, WHICH WAS RECOVERED BY ADMINISTRATIVE SETOFF IN MAY 1952.

SECTION 321 (A) OF THE TRANSPORTATION ACT OF 1940 PROVIDES, IN PERTINENT PART, AS FOLLOWS:

"* * * THE FULL APPLICABLE COMMERCIAL RATES, FARES, OR CHARGES SHALL BE PAID FOR TRANSPORTATION BY ANY COMMON CARRIER * * * OF ANY PERSONS OR PROPERTY FOR THE UNITED STATES, OR ON ITS BEHALF, EXCEPT THAT THE FOREGOING PROVISION SHALL NOT APPLY TO THE TRANSPORTATION OF MILITARY OR NAVAL PROPERTY OF THE UNITED STATES MOVING FOR MILITARY OR NAVAL AND NOT FOR CIVIL USE * * *.'

YOU NOW CLAIM REFUND OF $204.28, REPRESENTING THE DEDUCTIONS OF $96.23 ON GOVERNMENT BILL OF LADING NO. WV-1396311, AND $108.05 ON GOVERNMENT BILL OF LADING NO. WV-1460399, CONTENDING THAT DEDUCTIONS FOR LAND GRANT ARE NOT APPLICABLE BECAUSE THE SHIPMENTS MOVED FROM POINT OF ORIGIN SUBSEQUENT TO V-J DAY. IN THIS CONNECTION, YOU STATE THAT THE CARRIERS WERE ADVISED BY MR. E. H. BUNNELL, VICE PRESIDENT, ASSOCIATION OF AMERICAN RAILROADS, THAT "IN NO INSTANCE ARE SHIPMENTS MOVING AFTER V J DAY TO BE CONSIDERED AS MOVING FOR "MILITARY" USE AND THE GOVERNMENT IS NOT ENTITLED TO LAND- GRANT DEDUCTIONS THEREON.' HOWEVER, THE OPINIONS OF THE OFFICERS OF THE ASSOCIATION OF AMERICAN RAILROADS ARE NOT DETERMINATIVE OF THE FACTS, AND ARE NOT BINDING ON THE GOVERNMENT.

THE OCCURRENCE OF V-J DAY DOES NOT OF ITSELF PRECLUDE A SHIPMENT TO FOREIGN COUNTRIES UNDER LEND-LEASE BEING MILITARY OR NAVAL PROPERTY OF THE UNITED STATES MOVING FOR MILITARY OR NAVAL AND NOT FOR CIVIL USE, WITHIN THE MEANING OF SECTION 321 (A) OF THE TRANSPORTATION ACT OF 1940, AND SUBJECT TO DEDUCTIONS FOR LAND GRANT. MATERIAL SHIPPED BY THE UNITED STATES MAY BE MILITARY OR NAVAL PROPERTY OF THE UNITED STATES, WHETHER OR NOT IT IS SECURED BY A MILITARY OR NAVAL DEPARTMENT (SOUTHERN PAC.CO. V. DEFENSE SUPPLIES CORP., 64 F.SUPP. 605), AND MAY MOVE FOR MILITARY OR NAVAL USE WHETHER OR NOT INTENDED FOR THE DIRECT USE OF A MILITARY OR NAVAL DEPARTMENT OF THE UNITED STATES. NORTHERN PACIFIC RY. V. UNITED STATES, 330 U.S. 248; POWELL V. UNITED STATES, 60 F.SUPP. 433. THE MILITARY OR NAVAL CHARACTER OF PROPERTY IS DETERMINED BY THE USE FOR WHICH IT IS PRIMARILY INTENDED. IN NORTHERN PACIFIC RY. V. UNITED STATES, PROPERTY FOR MILITARY OR NAVAL USE IS DEFINED ON PAGE 254 AS:

"* * * ALL PROPERTY CONSUMED BY THE ARMED FORCES OR BY THEIR ADJUNCTS, ALL PROPERTY WHICH THEY USE TO FURTHER THEIR PROJECTS, ALL PROPERTY WHICH SERVES THEIR MANY NEEDS OR WANTS IN TRAINING OR PREPARATION FOR WAR, IN COMBAT, IN MAINTAINING THEM AT HOME OR ABROAD, IN THEIR OCCUPATION AFTER VICTORY IS WON.'

AFTER THE VICTORY IN EUROPE AND IN JAPAN, THE UNITED KINGDOM WAS ENGAGED WITH THE UNITED STATES AND OTHER ALLIES IN THE OCCUPATION OF DEFEATED COUNTRIES AND THE INVASION AND OCCUPATION OF A TERRITORY BY A HOSTILE ARMY IS AN INCIDENT OF WAR AND MILITARY OPERATION. SEE ARTICLE 42, ET Q., HAGUE CONVENTION OF 1907, 36 STAT. 2306, 31 COMP. GEN. 629.

A NOTATION ON BOTH GOVERNMENT BILLS OF LADING STATES THAT THE MATERIAL WAS UNITED STATES PROPERTY. BILL OF LADING NO. WV-1396311 ALSO SHOWS THAT THE SHIPMENT CONSISTED OF AIRPLANE PARTS WHICH THE GOVERNING REQUISITION SHOWS WERE SECURED FOR USE BY THE ROYAL AIR FORCE, A MILITARY AGENCY, FOR THE REPAIR OF A "LIBERATOR AIRCRAFT.' REPORTS FROM THE DEPARTMENT OF THE ARMY STATE, CONCERNING BOTH SHIPMENTS, THAT THE MATERIAL WAS MILITARY PROPERTY FOR MILITARY USE. ON THE BASIS OF OUR RECORD, THEREFORE, IT APPEARS THAT THE PROPERTY WAS MILITARY PROPERTY OF THE UNITED STATES MOVING FOR MILITARY USE, WITHIN THE MEANING OF SECTION 321 (A) OF THE TRANSPORTATION ACT OF 1940, AND WAS SUBJECT TO DEDUCTIONS FOR LAND GRANT.

ACCORDINGLY, THE DISALLOWANCE OF YOUR CLAIM FOR $204.28 WAS PROPER, AND IS SUSTAINED.