B-132866, B-132772, DEC. 2, 1957

B-132866, B-132772, DEC. 2, 1957

TO THE CENTRAL OF GEORGIA RAILWAY COMPANY:

CONSIDERATION HAS BEEN GIVEN YOUR REQUESTS, FILES N-31004-G-A, N 31105-G- A, N-31107-G-A, AND N-31118-G-A, FOR REVIEW OF OUR SETTLEMENTS WHICH DISALLOWED YOUR CLAIMS FOR ADDITIONAL FREIGHT CHARGES OF $354.37, $56.25, $158.94, AND $17.66, STATED ON SUPPLEMENTAL BILLS NOS. 31104-B-G-R-1291-2, 31105-B-G-R-1293-2, 31107-B-G-R-1295-2, AND 31118-B-G-R-1296-2, RESPECTIVELY.

THESE CLAIMS ARISE FROM GOVERNMENT BILLS OF LADING ISSUED BY THE UNITED STATES TREASURY DEPARTMENT, PROCUREMENT DIVISION, TO COVER SHIPMENTS OF STEEL RODS, INGOTS, AND PLATES, WHICH WERE MOVED DURING JULY 1944 TO VARIOUS PORTS FOR EXPORT TO GREAT BRITAIN UNDER THE LEND LEASE ACT OF MARCH 11, 1941, 55 STAT. 31. EACH BILL OF LADING CONTAINS REFERENCE TO EITHER REQUISITION NO. BSG/19807/DA/T39 OR DSC/19807/DA/T46, WHICH WERE THE SERIAL NUMBERS ASSIGNED TO THE REQUISITIONS FOR DEFENSE ARTICLES UNDER WHICH THE STEEL ARTICLES SHIPPED WERE PROCURED BY THE BRITISH MINISTRY OF SUPPLY MISSION. IT IS STATED IN THE MASTER REQUISITION, ESC/19807, THAT "IT IS IMPOSSIBLE TO SPECIFY PRECISELY THE PURPOSES FOR WHICH ARTICLES TO BE MANUFACTURED FROM THEIR STEEL WILL BE USED, EXCEPT TO STATE THAT THESE ARTICLES WILL BE USED IN THE UNITED KINGDOM FOR PURPOSES ABSOLUTELY ESSENTIAL TO MAINTAIN THE MAXIMUM WAR EFFORT," AND SUB-REQUISITIONS NOS. T39 AND T46 INDICATE THAT THE REQUISITIONED MATERIAL WAS INTENDED TO BE USED BY THE "ARMY, NAVY, AIR AND OTHER GOV-T. AGENCIES.'

YOU CLAIM THAT ONLY 50 PERCENT OF THE WEIGHT OF EACH SHIPMENT CONSISTED OF "MILITARY OR NAVAL PROPERTY OF THE UNITED STATES MOVING FOR MILITARY OR NAVAL AND NOT FOR CIVIL USE" TO WHICH, UNDER SECTION 321 (A) OF THE TRANSPORTATION ACT OF 1940, 54 STAT. 898, 954, LAND GRANT RATES ARE APPLICABLE. OUR SETTLEMENTS WERE BASED ON THE DETERMINATION THAT THE ENTIRE WEIGHT OF EACH SHIPMENT CONSISTED OF MILITARY PROPERTY MOVING FOR MILITARY USE.

IN EACH REQUEST FOR REVIEW YOU URGE THAT THE SETTLEMENT CONCERNED IS INCONSISTENT WITH THE STIPULATION OF FACTS FILED BY THE PARTIES IN ATLANTIC COAST LINE RAILROAD COMPANY V. UNITED STATES, COURT OF CLAIMS NO. 48826, AND WITH THE RULING IN CHICAGO, ROCK ISLAND AND PACIFIC R. CO. V. UNITED STATES, COURT OF CLAIMS NO. 49213, DECIDED JUNE 5, 1957. ALSO, YOU STATE THAT THESE SETTLEMENTS CONFLICT WITH THE ALLOWANCE OF YOUR SUPPLEMENTAL BILL NO. 31106-B-O-R-1294-2, IN A SETTLEMENT DATED DECEMBER 6, 1956 (TK-280406). THAT BILL COVERED MATERIAL SHIPPED UNDER REQUISITION ESG/19807, THE MASTER REQUISITION INVOLVED HERE, AND WAS SETTLED ON THE BASIS YOU ALLEGE IS APPLICABLE TO THE SETTLEMENTS UNDER REVIEW.

IN DETERMINING WHETHER A SHIPMENT CONSISTS OF "MILITARY OR NAVAL PROPERTY OF THE UNITED STATES MOVING FOR MILITARY OR NAVAL USE," THE CONTROLLING TEST UNDER SECTION 321 (A) OF THE TRANSPORTATION ACT OF 1940 IS THE USE TO WHICH THE PROPERTY IS DEDICATED OR DEVOTED. GENERALLY, THIS INTENDED USE CORRESPONDS WITH THE ULTIMATE USE, BUT WHERE THE INTENDED USE IS NOT DEFINITELY INDICATED, A DETERMINATION AS TO THE ULTIMATE USE APPARENTLY MAY REQUIRE CONSIDERATION OF PERTINENT DEVELOPMENTS AT DESTINATION. SEE NORTHERN PACIFIC R. CO. V. UNITED STATES, 330 U.S. 248, 254, 257; CHICAGO, ROCK ISLAND AND PACIFIC R.R. CO. V. UNITED STATES, COURT OF CLAIMS NO. 49213, DECIDED JUNE 5, 1957. HOWEVER, IN THE PRESENT INSTANCES INFORMATION AS TO ONLY THE INTENDED USE IS AVAILABLE, AND THAT INFORMATION, AS CLARIFIED IN THE MASTER REQUISITION, IS THAT THAT MATERIAL WOULD BE USED FOR "PURPOSES ABSOLUTELY ESSENTIAL TO MAINTAIN THE MAXIMUM WAR FORT," BY "ARMY, NAVY, AIR AND OTHER GOV-T. AGENCIES.' IN ADDITION, THE FACT THAT THESE SHIPMENTS WERE MOVED FOR EXPORT TO GREAT BRITAIN DURING A PERIOD WHEN THE ALLIES' EFFORTS WERE BEING DIRECTED TOWARDS A SUCCESSFUL CONCLUSION OF THE WAR, REASONABLY ESTABLISHES THAT THE SHIPMENTS CONCERNED WERE MILITARY PROPERTY MOVING FOR MILITARY USE WITHIN THE PURVIEW OF THE ABOVE SECTION 321 (A) OF THE TRANSPORTATION ACT OF 1940. WE FIND NO SUPPORT FOR THE BASIS OF SETTLEMENT URGED BY YOU GIVING EFFECT TO END USES 50 PERCENT CIVIL AND 50 PERCENT MILITARY.

THE STIPULATION FILED IN THE ABOVE ATLANTIC COAST LINE CASE AS A BASIS FOR JUDGMENT MUST BE LIMITED TO THE FACTS IN THAT CASE AND CANNOT BE REGARDED AS CONTROLLING THE DISPOSITION OF THE PRESENT CLAIMS BY YOUR COMPANY. ASIDE FROM THAT, IT IS DISTINGUISHABLE ON ITS FACTS. THESE CLAIMS INVOLVE SHIPMENTS OF LEND-LEASE STEEL ARTICLES; THAT CASE CONCERNED SHIPMENTS OF LEND-LEASE ARTICLES CONSISTING OF ROSIN, COTTON, TURPENTINE, LARD, DRIED SKIMMED MILK, PEAS AND FRUIT. THE PROCUREMENT REQUISITIONS IN THESE CLAIMS STATE THAT THE PROPERTY WAS INTENDED TO BE USED BY "ARMY, NAVY, AIR AND OTHER GOV-T. AGENCIES; " THOSE IN THE ATLANTIC COAST LINE CASE DESIGNATED THE INTENDED USE OF THE PROPERTY AS "COMMERCIAL," "VARIOUS," "ARMY, NAVY, AIR AND OTHER," AND "NAVY, ARMY, AIR FORCE AND CIVILIAN.'

IT SEEMS CLEAR THAT THE ULTIMATE USE OF THE PROPERTY IN THAT CASE WAS NOT DEFINITELY DETERMINABLE AND THAT SOME CIVILIAN USES WERE INVOLVED AND THE STIPULATED SETTLEMENT, BASED ON AGREEMENTS DERIVED FROM THE INTENDED USE AS SHOWN IN THE REQUISITIONS, RANGED FROM PAYMENT ON THE BASIS OF 50 PERCENT CIVIL, 50 PERCENT MILITARY, ON REQUISITIONS SHOWING THE USE OF THE PROPERTY AS "COMMERCIAL," OR "VARIOUS," TO PAYMENT ON THE BASIS OF 5 PERCENT CIVIL, 95 PERCENT MILITARY, ON REQUISITIONS SHOWING THE USE OF THE PROPERTY AS "ARMY, NAVY, AIR FORCE AND OTHER.'

THE MENTIONED ROCK ISLAND CASE DID NOT INVOLVE THE PROCUREMENT OF SHIPMENTS OF PROPERTY UNDER THE LEND-LEASE ACT. IT DEALT WITH SHIPMENTS OF SURPLUS SCRAP STEEL CONSIGNED BY THE MARITIME COMMISSION FROM THE PACIFIC COAST TO STEEL COMPANIES IN THE MID-WEST. FROM THE EVIDENCE OF ULTIMATE USE PRESENTED IN THAT CASE, THE COURT CONCLUDED THAT A CERTAIN PERCENTAGE OF THE SURPLUS SCRAP STEEL WAS INTENDED TO BE USED FOR CIVILIAN PURPOSES AND THAT A CERTAIN PERCENTAGE WAS INTENDED TO BE USED FOR MILITARY PURPOSES. OUR RECORD IN THE PRESENT CASE DOES NOT SHOW ANY EVIDENCE INCONSISTENT WITH THE MILITARY CHARACTERIZATION OF THE MATERIAL, AS REFLECTED IN THE REQUISITIONS.

WE NOTE THAT YOUR SUPPLEMENTAL BILL NO. 31306-B-G-R, UPON WHICH WE ISSUED OUR SETTLEMENT OF DECEMBER 6, 1956 (TK-280406), IS INCLUDED AS ONE OF THE CLAIMS FILED BY THE CARRIER IN CENTRAL OF GEORGIA RAILWAY COMPANY V. UNITED STATES, COURT OF CLAIMS NO. 316-57. IN THAT SUIT THE CARRIER IS ALLEGING THAT THE FULL COMMERCIAL TARIFF RATES APPLY TO THE SHIPMENTS COVERED BY THE BILLS OF LADING IN THE SUPPLEMENTAL BILL. THIS WOULD INDICATE DISAGREEMENT WITH THE BASIS USED IN THAT SETTLEMENT WHICH, IT SHOULD BE NOTED, DOES NOT PROPERLY REFLECT THE BASIS USED IN OUR AUDIT IN CONNECTION WITH LEND-LEASE REQUISITIONS OF THE TYPE INVOLVED. CONSISTENT WITH THE VIEW MAINTAINED HERE, THE AMOUNT ALLOWED IN THE SETTLEMENT SHOULD BE REFUNDED.

FOR THE REASONS GIVEN ABOVE, THE SETTLEMENTS WHICH ARE THE SUBJECT OF YOUR REQUESTS FOR REVIEW ..END :