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B-130745, SEP. 6, 1957

B-130745 Sep 06, 1957
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TO LOUISVILLE AND NASHVILLE RAILROAD COMPANY: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 13. ENTITLED "RECORD OF TRANSIT FREIGHT BILLS AND TONNAGE CREDITS" WAS PREPARED AT THE TRANSIT POINT INDICATING THAT THE SHIPMENT WAS RECORDED FOR TRANSIT UNDER BUREAU NO. 2341 AND THE TYPEWRITTEN NOTATION "1/16/54" APPEARS IN THE SPACE ENTITLED "EXPIRATION DATE.'. THE MATERIAL WAS LATER RESHIPPED FROM THE TRANSIT STATION ON MARCH 4. WAS SUBSEQUENTLY TRANSSHIPPED TO AN OVERSEAS DESTINATION. WAS ADDED AT THE TRANSIT STATION AND IS NOT HERE INVOLVED. THAT CLAIM WAS DISALLOWED. OUR TRANSPORTATION DIVISION FURNISHED YOU AN EXPLANATION AS TO THE REASONS YOUR CLAIM WAS DISALLOWED. IN REQUESTING REVIEW OF THE MATTER YOU REITERATE YOUR CONTENTION THAT THE GOVERNMENT IS NOT ENTITLED TO THE TRANSIT PRIVILEGE ON THIS SHIPMENT UNDER THE TERMS OF AMENDMENT NO. 61.

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B-130745, SEP. 6, 1957

TO LOUISVILLE AND NASHVILLE RAILROAD COMPANY:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 13, 1957, FILE NO. 2 11556, 11848, REQUESTING REVIEW OF OUR SETTLEMENT CERTIFICATE DATED JUNE 26, 1956, WHICH DISALLOWED YOUR CLAIM FOR $71.22 ADDITIONAL FREIGHT CHARGES ALLEGED TO BE DUE FOR THE TRANSPORTATION OF ONE CARLOAD OF FREIGHT TRAILERS AND OTHER MISCELLANEOUS PROPERTY FROM BROOKLEY, ALABAMA, TO NEW ORLEANS, LOUISIANA, UNDER GOVERNMENT BILL OF LADING NO. AF-T-14505, DATED MARCH 4, 1953.

A PORTION OF THE SHIPMENT INVOLVED COMPRISED TONNAGE WHICH HAD ORIGINATED AT SHELBY, OHIO, ON JANUARY 16, 1952, AND HAD MOVED TO BROOKLEY, ALABAMA, ON GOVERNMENT BILL OF LADING NO. AF-759232, FOR STORAGE IN TRANSIT. GOVERNMENT WD AGO FORM 55-105, ENTITLED "RECORD OF TRANSIT FREIGHT BILLS AND TONNAGE CREDITS" WAS PREPARED AT THE TRANSIT POINT INDICATING THAT THE SHIPMENT WAS RECORDED FOR TRANSIT UNDER BUREAU NO. 2341 AND THE TYPEWRITTEN NOTATION "1/16/54" APPEARS IN THE SPACE ENTITLED "EXPIRATION DATE.' THE MATERIAL WAS LATER RESHIPPED FROM THE TRANSIT STATION ON MARCH 4, 1953, TO NEW ORLEANS, AS MENTIONED ABOVE, AND WAS SUBSEQUENTLY TRANSSHIPPED TO AN OVERSEAS DESTINATION, AS EVIDENCED BY A CERTIFICATE OF EXPORTATION DATED MARCH 10, 1953, PREPARED BY THE NEW ORLEANS PORT OF EMBARKATION. THE RECORD SHOWS THAT THE TRANSIT TONNAGE, CONSISTING OF 17,160 POUNDS OF FREIGHT TRAILERS, NOIBN, REMAINED AT THE TRANSIT STATION FOR MORE THAN ONE YEAR BUT LESS THAN TWO YEARS. THE NON-TRANSIT WEIGHT OF 12,379 POUNDS CONSISTING OF MISCELLANEOUS FREIGHT, WAS ADDED AT THE TRANSIT STATION AND IS NOT HERE INVOLVED.

IN COMPUTING THE THROUGH CHARGES ON THE TRANSIT WEIGHT OF 17,160 POUNDS, OUR TRANSPORTATION DIVISION ADJUSTED YOUR ACCOUNT ON THE BASIS OF THE THROUGH RATES AND CHARGES APPLICABLE ON JANUARY 16, 1952, THE DATE THE TRANSIT TONNAGE ORIGINATED AT SHELBY, OHIO. THEREAFTER, YOU SUBMITTED SUPPLEMENTAL BILL NO. 3950-130-A, CLAIMING ADDITIONAL CHARGES OF $71.22, BASED UPON THROUGH RATES AND CHARGES APPLICABLE ON MARCH 4, 1953, THE DATE THE SHIPMENT INVOLVED MOVED FROM THE TRANSIT STATION. BY OUR SETTLEMENT DATED JUNE 26, 1956, THAT CLAIM WAS DISALLOWED, AND BY LETTER DATED DECEMBER 27, 1956, OUR TRANSPORTATION DIVISION FURNISHED YOU AN EXPLANATION AS TO THE REASONS YOUR CLAIM WAS DISALLOWED.

IN REQUESTING REVIEW OF THE MATTER YOU REITERATE YOUR CONTENTION THAT THE GOVERNMENT IS NOT ENTITLED TO THE TRANSIT PRIVILEGE ON THIS SHIPMENT UNDER THE TERMS OF AMENDMENT NO. 61, ITEM NO. 6 OF ASSOCIATION OF AMERICAN RAILROADS SECTION 22 QUOTATION NO. 16-F. THIS AMENDMENT WAS ISSUED ON DECEMBER 30, 1952, AND BY ITS TERMS WAS MADE EFFECTIVE AND "APPLICABLE TO ALL SHIPMENTS MOVING UNDER A.A.R. SECTION 22 QUOTATION NO. 16-F, AS AMENDED, ON HAND AT A TRANSIT POINT OR EN ROUTE TO A TRANSIT POINT ON DECEMBER 31, 1952.' YOUR POSITION IS THAT THIS AMENDMENT HAD THE EFFECT OF INCREASING THE CHARGES ON THE SHIPMENT HERE INVOLVED WHICH WAS ACTUALLY ON HAND AT A TRANSIT POINT ON DECEMBER 31, 1952, BUT WAS NOT RESHIPPED FROM THE TRANSIT STATION UNTIL MARCH 4, 1953, WHICH WAS WITHIN 24 MONTHS (TRANSIT TIME LIMIT) FROM THE DATE OF THE INBOUND FREIGHT BILL.

THE INTERSTATE COMMERCE COMMISSION HAS CONSISTENTLY HELD THAT AS TO SHIPMENTS WHICH ARE ACCORDED TRANSIT THE ONLY APPLICABLE RATES ARE THOSE IN EFFECT AT THE TIME OF THE INITIAL SHIPMENT. PACIFIC CHEMICAL AND FERTILIZER CO. V. PENNSYLVANIA RAILROAD CO., 270 I.C.C. 193, 195. WITH RESPECT TO RATES ESTABLISHED WHILE A SHIPMENT WAS AT THE TRANSIT POINT THE COMMISSION HAS HELD THAT SUCH RATES ARE NOT APPLICABLE TO THE THROUGH CHARGES AS THEY ARE NOT IN EFFECT AT THE TIME THE SHIPMENT ORIGINATES. GERRARD CO. V. BELT RAILWAY CO. OF CHICAGO, 270 I.C.C. 59, 62; BLAIR MOTOR CO. V. ALTON RAILROAD CO., 243 I.C.C. 154, 156; SOUTHWESTERN MILLING CO., INC. V. CHICAGO, BURLINGTON AND QUINCY RAILROAD CO., 159 I.C.C. 372; BOARD OF TRADE OF THE CITY OF CHICAGO V. ANN ARBOR RAILROAD CO., 39 I.C.C. 643, 651. NO REASON IS APPARENT WHY THE SAME PRINCIPLES SHOULD NOT BE APPLIED TO TRANSIT ARRANGEMENTS PROVIDED UNDER QUOTATION NO. 16-F.

THE ARRIVAL OF THE SHIPMENT HERE INVOLVED AT THE TRANSIT POINT DID NOT COMPLETE THE CONTRACT OF TRANSPORTATION, AS TRANSIT IS BASED ON THE THEORY THAT THE TRANSPORTATION CONTRACT HAS NOT BEEN COMPLETED, AND THAT THE ENTIRE SHIPMENT FROM ORIGIN THROUGH THE TRANSIT POINT TO FINAL DESTINATION IS THE SAME IN PRINCIPLE AS IF THE SHIPMENT HAD MOVED WITHOUT TRANSIT. CENTRAL RAILROAD OF NEW JERSEY V. UNITED STATES, 257 U.S. 247, 257; LARABEE FLOUR MILLS CO., V. CHICAGO, BURLINGTON AND QUINCY RAILROAD CO., 223 I.C.C. 55, 64; WHEELOCK AND BIERD V. AKRON, CANTON AND YOUNGSTOWN RAILWAY CO., 179 I.C.C. 517, 520.

IF EFFECT WERE TO BE GIVEN TO YOUR CONTENTION IN THIS MATTER THE CITED AMENDMENT NO. 61 WOULD, WITHOUT ANY APPARENT CONSIDERATION BEING EXTENDED TO THE GOVERNMENT, MATERIALLY MODIFY THE CONTRACT OF TRANSPORTATION AS FORMED WHEN THE SHIPMENT WAS ORIGINALLY MADE FROM POINT OF ORIGIN UNDER THE CONTRACTUAL TERMS AND CONDITIONS THEN IN FORCE. FOR THE MODIFICATION, SUCH AS IS HERE INVOLVED, OF A CONTRACT OF CARRIAGE GOVERNED BY A SECTION 22 RATE QUOTATION TO HAVE THE EFFECT YOU DESIRE AT LEAST THREE ELEMENTS GENERALLY APPEAR TO BE NECESSARY; NAMELY, THAT BOTH PARTIES AGREED TO THE MODIFICATION, THAT PROPER CONSIDERATION EXISTS, AND THAT THE RESULTING RATES ARE NOT IN EXCESS OF DULY FILED TARIFF RATES. APART FROM A QUESTION AS TO THE LEGALITY OF SUCH AN AGREEMENT, THE PRESENT RECORD DOES NOT INDICATE THAT THE GOVERNMENT EXPRESSLY AGREED TO THE INCREASE OR ACTUALLY MADE SHIPMENTS UNDER AMENDMENT NO. 61. THE MERE FACT THAT THE BILL OF LADING INDICATES THIS SHIPMENT WAS TRANSITED UNDER QUOTATION NO. 16-F CANNOT BE INTERPRETED TO MEAN THAT THE ADMINISTRATIVE AGENCY AGREED TO MOVE THE SHIPMENT FROM THE TRANSIT POINT PURSUANT TO THE TERMS OF AMENDMENT NO. 61, ITEM NO. 6. THE PROPOSED MODIFICATION IS ALSO LACKING AN ESSENTIAL CONSIDERATION. WHILE THE CARRIERS PROMISED TO DO NO MORE THAN CONTEMPLATED WHEN THE SHIPMENT WAS ORIGINALLY TENDERED FOR TRANSPORTATION, THE GOVERNMENT HAS RECEIVED NO RIGHTS OR PRIVILEGES IN ADDITION TO THOSE IT POSSESSED AT THE TIME OF SHIPMENT FROM POINT OF ORIGIN. IN THIS SITUATION, IT MUST BE CONCLUDED THAT THE AMENDMENT IN QUESTION WITH RESPECT TO ITEM NO. 6 OF QUOTATION NO. 16-F IS NOT VALID INSOFAR AS IT PURPORTS TO AUTHORIZE A RETROACTIVE INCREASE OF THROUGH FREIGHT CHARGES AS APPLICABLE AT THE TIME THE INBOUND SHIPMENT WAS MADE TO BROOKLEY.

IN VIEW OF THE WELL-ESTABLISHED RULE THAT THE RATE IN EFFECT AT THE TIME A SHIPMENT IS TENDERED FOR TRANSPORTATION AT THE POINT OF ORIGIN IS THE APPLICABLE RATE FOR SHIPMENTS ACCORDED TRANSIT, AND SINCE, IF AMENDMENT NO. 61 OF QUOTATION NO. 16-F WERE CONSTRUED AS URGED BY YOU, IT WOULD, WITHOUT CONSIDERATION AND THE CONCURRENCE OF THE GOVERNMENT, DEPRIVE IT OF A BENEFIT WHICH ACCRUED AT THE TIME THE ORIGINAL SHIPMENT WAS MADE, WE WOULD NOT BE WARRANTED IN RECOGNIZING AS VALID ANY CHARGE BASIS HIGHER THAN THAT AUTHORIZED FOR APPLICATION WHEN THIS SHIPMENT ORIGINATED. ACCORDINGLY, OUR SETTLEMENT OF JUNE 26, 1956, WAS PROPER AND IS SUSTAINED.

REGARDING YOUR SUPPLEMENTAL BILL NO. 3950-130-B, WHICH WAS FORWARDED HERE BY YOUR LETTER DATED MARCH 8, 1957, FILE NO. 85-RLB-11838, YOU ARE ADVISED THAT THE MATTER HAD BEEN REFERRED TO OUR TRANSPORTATION DIVISION FOR DIRECT SETTLEMENT CONSISTENT WITH THE FOREGOING AND YOU WILL BE ADVISED OF THEIR ACTION IN DUE COURSE.

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