B-129664, JUL. 9, 1957

B-129664: Jul 9, 1957

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TO THE VIRGINIAN RAILWAY COMPANY: REFERENCE IS MADE TO YOUR REQUEST. YOU CLAIMED AND WERE PAID FOR THIS SERVICE ON THE BASIS OF A THROUGH RATE OF 70 CENTS PER 100 POUNDS. OUR TRANSPORTATION DIVISION FOUND THAT THE PROPER CHARGES WERE THOSE COMPUTED ON THE BASIS OF A THROUGH RATE OF 51 CENTS PER 100 POUNDS. THE AUDIT BASIS REFLECTED AN OVERPAYMENT OF $133.87 WHICH IS REPORTED TO HAVE BEEN ADJUSTED BY APPROPRIATE DEDUCTION FROM AN AMOUNT OTHERWISE FOUND DUE ON YOUR BILL NO. 35830. APPLIES ONLY ON INTERNAL COMBUSTION ENGINES WHICH ARE USED FOR AGRICULTURAL PURPOSES. THE SHIPMENT OF INTERNAL-COMBUSTION ENGINES (AUTOMOBILE) INVOLVED IN THIS CASE WAS TRANSPORTED FROM DETROIT. WAS ACCORDED TRANSIT AT TOLEDO.

B-129664, JUL. 9, 1957

TO THE VIRGINIAN RAILWAY COMPANY:

REFERENCE IS MADE TO YOUR REQUEST, PER FILE 6055 LT, FOR REVIEW OF THE AUDIT ACTION TAKEN BY OUR TRANSPORTATION DIVISION IN THE SETTLEMENT OF YOUR BILL NO. 31277, COVERING FREIGHT CHARGES ON A SHIPMENT OF INTERNAL COMBUSTION ENGINES (AUTOMOBILE), WEIGHING 70,460 POUNDS, TRANSPORTED FROM DETROIT, MICHIGAN, TO NORFOLK, VIRGINIA, FOR EXPORT, WITH TRANSIT AT TOLEDO, OHIO, AND FORWARDED FROM THE LATTER POINT UNDER BILL OF LADING NO. WZ-T-11706, DATED JUNE 19, 1952.

YOU CLAIMED AND WERE PAID FOR THIS SERVICE ON THE BASIS OF A THROUGH RATE OF 70 CENTS PER 100 POUNDS, PUBLISHED IN ITEM NO. 1055-I OF SUPPLEMENT NO. 340 TO CENTRAL FREIGHT ASSOCIATION TARIFF NO. 218-N. IN THE AUDIT OF THIS PAYMENT, OUR TRANSPORTATION DIVISION FOUND THAT THE PROPER CHARGES WERE THOSE COMPUTED ON THE BASIS OF A THROUGH RATE OF 51 CENTS PER 100 POUNDS, PUBLISHED IN ITEM NO. 16000 OF SUPPLEMENT NO. 360 TO CENTRAL FREIGHT ASSOCIATION TARIFF NO. 218-N. THE AUDIT BASIS REFLECTED AN OVERPAYMENT OF $133.87 WHICH IS REPORTED TO HAVE BEEN ADJUSTED BY APPROPRIATE DEDUCTION FROM AN AMOUNT OTHERWISE FOUND DUE ON YOUR BILL NO. 35830.

IN REQUESTING REVIEW OF THE AUDIT ACTION, YOU CONTEND THAT THE ARTICLES SHIPPED SHOULD BE RATED UNDER ITEM NO. 1055-I, AND THAT THE RATE PUBLISHED IN ITEM NO. 16000, USED IN OUR AUDIT, APPLIES ONLY ON INTERNAL COMBUSTION ENGINES WHICH ARE USED FOR AGRICULTURAL PURPOSES.

THE SHIPMENT OF INTERNAL-COMBUSTION ENGINES (AUTOMOBILE) INVOLVED IN THIS CASE WAS TRANSPORTED FROM DETROIT, MICHIGAN, TO NORFOLK, VIRGINIA, FOR EXPORT, AND WAS ACCORDED TRANSIT AT TOLEDO, OHIO. THE JOINT THROUGH RATE OF 51 CENTS PER 100 POUNDS USED BY OUR TRANSPORTATION DIVISION IS AN EXPORT RATE PUBLISHED IN SECTION 8 OF CENTRAL FREIGHT ASSOCIATION TARIFF NO. 218-N.

THE CITED TARIFF NO. 218-N WAS ISSUED ON NOVEMBER 10, 1942, EFFECTIVE DECEMBER 15, 1942, AND SECTION 8 OF THE TARIFF CONTAINED EXPORT RATES WHICH APPLIED FROM VARIOUS POINTS OF ORIGIN TO NEW YORK, NEW YORK, NORFOLK, VIRGINIA, ETC., ON "AGRICULTURAL IMPLEMENTS AND PARTS, AS DESCRIBED IN NOTE 79, PAGE 130 * * *.' THE RATES ON THE ARTICLES DESCRIBED IN NOTE 79, AND THE POINTS OF ORIGIN AND DESTINATION FROM AND TO WHICH THE RATES APPLIED, WERE PUBLISHED IN TARIFF ITEMS NOS. 16000, 16002, 16004, 16006, 16008, 16010, AND 16012. THUS, THE RATES IN ALL OF THE CITED ITEMS COVERED THE SAME COMMODITY. NOTE 79, ON PAGE 130 OF THE TARIFF, PROVIDED AS FOLLOWS:

"LIST OF AGRICULTURAL IMPLEMENTS AND PARTS

"WHERE REFERENCE IS MADE TO THIS NOTE, RATES APPLY ON THE FOLLOWING ARTICLES:

"AGRICULTURAL IMPLEMENTS, OR PARTS OF, AS DESCRIBED IN OFFICIAL CLASSIFICATION UNDER THE HEADING OF "AGRICULTURAL IMPLEMENTS, HAND, OR PARTS," ALSO "AGRICULTURAL IMPLEMENTS, OTHER THAN HAND," AND "AGRICULTURAL IMPLEMENT PARTS, OTHER THAN HAND; " ALSO THE FOLLOWING:

"ENGINES, INTERNAL COMBUSTION, OR PARTS THEREOF.'

THE RATES PUBLISHED IN SECTION 8 OF CENTRAL FREIGHT ASSOCIATION FREIGHT TARIFF NO. 218-N, APPLICABLE ON "AGRICULTURAL IMPLEMENTS AND PARTS, AS DESCRIBED IN NOTE 79, PAGE 130," CAME UNDER THE SCRUTINY OF THE INTERSTATE COMMERCE COMMISSION WHEN THE CARRIERS SOUGHT TO RESTRICT THE RATES SO THAT THEY WOULD NOT APPLY ON "AIRPLANE ENGINES.' SEE AIRPLANE ENGINES IN OFFICIAL TERRITORY, 258 I.C.C. 226. IN THAT CASE THE INTERSTATE COMMERCE COMMISSION SAID THAT:

"AT THE PRESENT TIME THERE ARE THREE BASES OF RATES APPLICABLE ON INTERNAL-COMBUSTION ENGINES EXPORTED FROM THE ORIGIN TERRITORY THROUGH THE NORTH ATLANTIC AND CANADIAN PORTS, NAMELY, COMMODITY RATES BASED ON ALTERNATIVE MINIMA OF 30,000 AND 40,000 POUNDS, WHICH IN TURN ALTERNATE WITH THE CLASS RATES. THE DESCRIPTION INTERNAL-COMBUSTION ENGINES IN THE COMMODITY EXPORT RATE TARIFF IS ONE OF SEVERAL SUBORDINATE DESCRIPTIONS CONTAINED IN A LIST UNDER THE GENERAL CAPTION ,AGRICULTURAL IMPLEMENTS AND PARTS.'

"THE PRESENT COMMODITY RATES, AS WERE BOTH THE CLASS AND COMMODITY RATES PRIOR TO THE EASTERN CLASS RATE INVESTIGATION, ARE MADE ON THE MCGRAHAM FORMULA, UNDER WHICH THE RATE FROM CHICAGO, L., TO NEW YORK IS TREATED AS A KEY RATE, RATES FROM OTHER ORIGINS MADE SPECIFIC PERCENTAGES THEREOF, AND RATES TO THE NORTH ATLANTIC PORTS SOUTH OF NEW YORK, MADE DIFFERENTIALLY UNDER THE RATES TO NEW YORK. THE PRESENT EXPORT COMMODITY RATES ON INTERNAL-COMBUSTION ENGINES FROM CHICAGO TO NEW YORK, WHICH ARE USED HEREIN AS TYPICAL OF THOSE FROM OTHER ORIGINS, ARE 52.5 CENTS, MINIMUM 30,000 POUNDS, AND 45 CENTS, MINIMUM 40,000 POUNDS. THE COLUMN 40 CLASS RATE IS 65 CENTS. IT IS PROPOSED TO RESTRICT THE APPLICATION OF THE COMMODITY RATES SO THAT THEY WILL NOT APPLY ON AIRPLANE ENGINES, THEREBY LEAVING ALL THREE RATES EFFECTIVE FOR ALTERNATIVE APPLICATION ON ALL INTERNAL-COMBUSTION ENGINES EXCEPT AIRPLANE ENGINES, AND ONLY THE CLASS RATES APPLICABLE ON THE LATTER.'

THE COMMISSION FOUND THAT THE PROPOSED SCHEDULES, BY WHICH THE CARRIERS SOUGHT TO MAKE THE CITED RATES INAPPLICABLE ON "AIRPLANE ENGINES," HAD NOT BEEN SHOWN TO BE JUST AND REASONABLE AND ORDERED THEIR CANCELATION.

THE RATES OF 52.5 CENTS AND 45 CENTS, WHICH WERE REFERRED TO BY THE COMMISSION AS APPLYING FROM CHICAGO TO NEW YORK, WERE PUBLISHED IN ITEM NO. 16006 OF THE CITED TARIFF NO. 218-N, AND THE COMPANION RATES APPLYING FROM DETROIT TO NORFOLK--- THE MOVEMENT HERE INVOLVED--- WERE PUBLISHED IN ITEM NO. 16000. THUS, BOTH THE CARRIERS AND THE COMMISSION--- THE FORMER AS EVIDENCED BY THE ATTEMPT TO RESTRICT THE APPLICATION OF THE RATES, AND THE LATTER BY ITS STATEMENTS IN THE CITED REPORT--- RECOGNIZED THE FACT THAT THE RATES REFERRED TO ABOVE WERE NOT RESTRICTED TO APPLY ONLY ON INTERNAL-COMBUSTION ENGINES USED FOR AGRICULTURAL PURPOSES, BUT APPLIED ON INTERNAL-COMBUSTION ENGINES GENERALLY.

THE RATES PUBLISHED IN ITEMS NOS. 16000 AND 16006 OF THE ORIGINAL TARIFF NO. 218-N HAVE BEEN BROUGHT FORWARD--- WITH THE ADDITION THERETO OF AUTHORIZED INCREASES--- IN REISSUES OF THE SAME ITEMS IN SUPPLEMENT NO. 360 TO THE TARIFF, AND NOTE 79 HAS BEEN BROUGHT FORWARD UNCHANGED IN ALL MATERIAL RESPECTS IN SUPPLEMENT NO. 340 TO THE TARIFF. THEREFORE, IT SEEMS APPARENT THAT THE RATES PUBLISHED IN SECTION 8 OF CENTRAL FREIGHT ASSOCIATION FREIGHT TARIFF NO. 218-N FOR APPLICATION ON "AGRICULTURAL IMPLEMENTS AND PARTS, AS DESCRIBED IN NOTE 79, PAGE 130," WERE RECOGNIZED BOTH BY THE CARRIERS AND THE COMMISSION AS APPLYING ON "ALL INTERNAL- COMBUSTION NGINES" (AIRPLANE ENGINES IN OFFICIAL TERRITORY, 258 I.C.C. 226, 227), AND NOTHING HAS BEEN FOUND TO INDICATE OTHER THAN THAT THE RATES STILL APPLIED ON INTERNAL COMBUSTION ENGINES GENERALLY AT THE TIME THAT THE SUBJECT SHIPMENT MOVED. REFERENCE IS MADE, ALSO, TO THE APPLICATION OF SECTION 8 ON PAGE 349 OF THE TARIFF, SHOWING THAT THE RATES IN THAT SECTION TAKE PRECEDENCE OVER THE RATES IN SECTION 1 OF THE TARIFF, ON EXPORT TRAFFIC.

ACCORDINGLY, FOR THE REASONS GIVEN ABOVE, THE AUDIT ACTION OF OUR TRANSPORTATION DIVISION IS SUSTAINED.