B-129036, MAR. 1, 1957

B-129036: Mar 1, 1957

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INC.: REFERENCE IS MADE TO YOUR LETTER OF AUGUST 20. WAS TENDERED WITHOUT ROUTING INSTRUCTIONS TO THE MOTOR FREIGHT CORPORATION AT TERRE HAUTE FOR TRANSPORTING TO CARSON CITY. THAT THE SHIPMENT WAS DELIVERED BY YOU AT RENO. YOU CLAIMED AND WERE PAID $1. SINCE ONE CONDITION OF THE INVOLVED BILL OF LADING PROVIDED THAT "PAYMENT WILL BE MADE TO THE LAST CARRIER UNLESS OTHERWISE SPECIFICALLY STIPULATED. " AND YOU WERE SO PAID AS THE LAST CARRIER. UPON YOUR FAILURE TO REMIT $704.92 THAT AMOUNT WAS DEDUCTED FROM ONE OF YOUR SUBSEQUENT BILLS. YOU CONTEND THAT YOUR CLAIM IS IN ORDER. SINCE YOU HAVE PROTECTED RAIL CHARGES AS A MAXIMUM FROM POINT OF ORIGIN IN ACCORDANCE WITH YOUR CONTRACT WITH THE GOVERNMENT AND THAT YOU HAVE AT NO TIME MADE A CONTRACT WITH THE GOVERNMENT TO PROTECT TRUCK RATES.

B-129036, MAR. 1, 1957

TO FLYNN FORWARDING COMPANY, INC.:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 20, 1956, FILE SL 1185 F 1, REQUESTING REVIEW OF THE SETTLEMENT CERTIFICATE DATED JULY 31, 1956 (CLAIM NO. TK 619596), IN WHICH WE DISALLOWED YOUR CLAIM FOR $704.92, REPRESENTING ADDITIONAL CHARGES ALLEGED TO BE DUE FOR THE TRANSPORTATION OF A SHIPMENT OF ANTI-AIRCRAFT DIRECTORS FROM TERRE HAUTE, INDIANA, TO RENO, NEVADA, UNDER GOVERNMENT BILL OF LADING NO. WY-1169880, DURING OCTOBER 1952.

THIS BILL OF LADING SHOWS THAT THE SHIPMENT, WEIGHING 11,207 POUNDS, WAS TENDERED WITHOUT ROUTING INSTRUCTIONS TO THE MOTOR FREIGHT CORPORATION AT TERRE HAUTE FOR TRANSPORTING TO CARSON CITY, NEVADA, AND THAT THE SHIPMENT WAS DELIVERED BY YOU AT RENO. FOR THE SERVICES PERFORMED, YOU CLAIMED AND WERE PAID $1,665.36, COMPUTED ON THE BASIS OF A RATE OF $14.86 PER HUNDRED POUNDS APPLIED TO THE ACTUAL WEIGHT OF THE SHIPMENT. INCIDENT TO THE AUDIT OF THE PAYMENT VOUCHER, OUR TRANSPORTATION DIVISION--- AFTER OBTAINING VERIFICATION OF THE OPEN ROUTING FROM THE ADMINISTRATIVE OFFICE- -- DETERMINED THAT THE SHIPMENT HAD BEEN MISROUTED BY THE ORIGIN CARRIER AND ISSUED A NOTICE OF OVERPAYMENT REQUESTING THAT YOU REFUND $704.92. THIS AMOUNT REPRESENTS THE DIFFERENCE BETWEEN THE CHARGES CLAIMED AND PAID AND THE CHARGES COMPUTED BY THE USE OF THE FIRST-CLASS MOTOR RATE OF $8.57 PER HUNDRED POUNDS AT THE ACTUAL WEIGHT OF THE SHIPMENT, AS PROVIDED BY NATIONAL MOTOR FREIGHT CLASSIFICATION NO. 11, MF-I.C.C. NO. 1, ITEM NO. 73380 (MINIMUM TRUCKLOAD WEIGHT OF 10,000 POUNDS), AND ROCKY MOUNTAIN MOTOR TARIFF BUREAU TRANSCONTINENTAL CLASS TARIFF NO. 5-A, MF-I.C.C. NO. 31. SINCE ONE CONDITION OF THE INVOLVED BILL OF LADING PROVIDED THAT "PAYMENT WILL BE MADE TO THE LAST CARRIER UNLESS OTHERWISE SPECIFICALLY STIPULATED," AND YOU WERE SO PAID AS THE LAST CARRIER, UPON YOUR FAILURE TO REMIT $704.92 THAT AMOUNT WAS DEDUCTED FROM ONE OF YOUR SUBSEQUENT BILLS, AS AUTHORIZED BY SECTION 322 OF THE TRANSPORTATION ACT OF 1940, 49 U.S.C. 66.

IN YOUR REQUEST FOR REVIEW, YOU CONTEND THAT YOUR CLAIM IS IN ORDER, SINCE YOU HAVE PROTECTED RAIL CHARGES AS A MAXIMUM FROM POINT OF ORIGIN IN ACCORDANCE WITH YOUR CONTRACT WITH THE GOVERNMENT AND THAT YOU HAVE AT NO TIME MADE A CONTRACT WITH THE GOVERNMENT TO PROTECT TRUCK RATES. THE CONTRACT TO WHICH YOU REFER APPARENTLY IS A FREIGHT FORWARDER'S AGREEMENT MADE WITH THE WAR DEPARTMENT, DATED JULY 24, 1942, AND IN EFFECT IN AMENDED FORM AT THE TIME OF SHIPMENT. PARAGRAPH 1 OF THIS AGREEMENT PROVIDES, IN PERTINENT PART, THAT:

"THE UNDERSIGNED HEREBY AGREES TO ACCEPT ALL SHIPMENTS TENDERED BY THE WAR DEPARTMENT, IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT AND SUBJECT TO THE QUALIFICATIONS SPECIFIED IN EXHIBIT A * * *.'

SINCE THE INVOLVED SHIPMENT WAS NOT TENDERED TO YOU BY THE WAR DEPARTMENT --- IT HAVING BEEN TENDERED TO THE MOTOR FREIGHT CORPORATION- - THIS AGREEMENT HAS NO BEARING ON THE PRESENT MATTER. SEE SOUTHERN CALIFORNIA FREIGHT FORWARDERS--- FREIGHT FORWARDER APPLICATION, 265 I.C.C. 473, 476.

IT IS A WELL-ESTABLISHED RULE THAT WHEN A SHIPMENT IS TENDERED TO A MOTOR CARRIER WITHOUT ROUTING INSTRUCTIONS THE CARRIER HAS THE DUTY TO FORWARD THE SHIPMENT VIA THE LEAST EXPENSIVE ROUTE REASONABLY AVAILABLE. MURRAY CO. OF TEXAS, INC., V. MORROW, INC., 54 M.C.C. 442, 444-445; METZNER STOVE REPAIR CO. V. RANFT, 47 M.C.C. 151, 154. SINCE THE INVOLVED BILL OF LADING WAS NOT ROUTED, THE MOTOR FREIGHT CORPORATION WAS NOT AUTHORIZED TO DELIVER THE SHIPMENT TO A CONNECTING CARRIER OR A FREIGHT FORWARDER NOT PROTECTING THE LOWEST AVAILABLE MOTOR FREIGHT CHARGES. MOREOVER, THE FORM OF BILLING WAS NOT CONSISTENT WITH FREIGHT FORWARDER PROCEDURES. THE INTERSTATE COMMERCE COMMISSION, PURSUANT TO ITS FINDINGS IN BILLS OF LADING OF FREIGHT FORWARDERS, 259 I.C.C. 277, ISSUED AN ORDER (10 F.R. 51; 49 C.F.R. 431.1) WHICH PROVIDED THAT:

"ALL FREIGHT FORWARDERS SUBJECT TO PART IV OF THE INTERSTATE COMMERCE ACT PARTICIPATING IN THE TRANSPORTATION OF PROPERTY IN INTERSTATE COMMERCE ARE REQUIRED, ON OR BEFORE APRIL 1, 1945, AND THEREAFTER, TO MAINTAIN AND APPLY ON ALL SHIPMENTS MOVING UNDER FORWARDER RATES IN INTERSTATE COMMERCE, RULES, REGULATIONS, AND PRACTICES PROVIDING FOR THE ISSUANCE TO THE SHIPPER, AT THE INITIAL POINT OF ORIGIN, OF A THROUGH BILL OF LADING, COVERING THE TRANSPORTATION FROM INITIAL POINT OF ORIGIN TO ULTIMATE DESTINATION, EITHER BY THE FREIGHT FORWARDER ON ITS FORM, OR BY A MOTOR CARRIER ON ITS FORM WITH A NOTATION THEREON SHOWING THE NAME OF THE FREIGHT FORWARDER IN WHOSE SERVICE THE SHIPMENT IS MOVING.'

SINCE THE INVOLVED BILL OF LADING DID NOT INDICATE THAT THIS SHIPMENT HAD BEEN TENDERED TO THE MOTOR FREIGHT CORPORATION FOR TRANSPORTATION EITHER IN FREIGHT-FORWARDER SERVICE OR AS A JOINT MOTOR FORWARDER MOVEMENT, YOUR CONTENTIONS THAT THE SHIPMENT WAS RECEIVED IN GOOD FAITH IN THE BELIEF THAT THE LEGAL CHARGES OF FREIGHT FORWARDERS WOULD APPLY AND THAT IT WAS NOT INCUMBENT UPON YOU TO ASCERTAIN THE EXTENT OF THE AUTHORITY OF THE CONNECTING CARRIER APPEAR TO BE WITHOUT MERIT. FURTHERMORE, THE INTERSTATE COMMERCE COMMISSION HAS HELD THAT IT WOULD BE IMPROPER FOR COMMON CARRIERS TO EMPLOY FREIGHT FORWARDERS TO PERFORM LINE-HAUL SERVICE IN ORDER TO EFFECT COMPLETION OF THE CARRIERS' BILL OF LADING OBLIGATIONS. SOUTHERN CALIFORNIA FREIGHT FORWARDERS--- FREIGHT, FORWARDER APPLICATION, 265 I.C.C. 473, 476. THEREFORE, THE CHARGES APPLICABLE ON THIS SHIPMENT ARE THOSE COMPUTED ON THE BASIS OF THE RATES SHOWN IN THE RELEVANT MOTOR CARRIER FREIGHT TARIFFS.