B-138161, B-142619, OCT. 6, 1960

B-138161, B-142619, OCT. 6, 1960

TO CAKE AND NEGUS:

REFERENCE IS MADE TO YOUR LETTERS OF APRIL 26 AND AUGUST 9, 1960, RELATIVE TO THE INDEBTEDNESS TO THE UNITED STATES OF THE J. H. ROSE TRUCK LINES, INC., BECAUSE OF OVERCHARGES MADE FOR TRANSPORTATION SERVICE RENDERED. YOU REQUEST THAT THE NAME OF THIS DEBTOR BE REMOVED FROM THE LIST OF CONTRACTORS INDEBTED TO THE UNITED STATES, THAT THE AMOUNT WITHHELD FROM BILLS OTHERWISE PAYABLE TO IT BE REFUNDED, AND THAT NO FURTHER DEDUCTIONS BE MADE TO EFFECT COLLECTION OF AMOUNTS DUE THE UNITED STATES PENDING A JUDICIAL DETERMINATION OF THE ASSERTED INDEBTEDNESS BY DECISION IN THE CASE OF J. H. ROSE TRUCK LINES, INC. V. UNITED STATES, COURT OF CLAIMS NO. 130-60, FILED APRIL 14, 1960.

THE DEBT OF THE J. H. ROSE TRUCK LINES, INC., TO THE UNITED STATES AS OF SEPTEMBER 15, 1960, WAS $89,444.48. WE ARE HOLDING $31,641.80 FOR APPLICATION TO SUCH DEBT. THE SUM OF $45,995.04 OF THE INDEBTEDNESS RELATES TO BILLS PAID PRIOR TO SEPTEMBER 1, 1958; AND $43,449.44 TO BILLS PAID AFTER THAT DATE. THE AMOUNT OF $45,995.04 OVERPAID THIS CARRIER PRIOR TO SEPTEMBER 1, 1958, INCLUDES THE AMOUNT OF $37,207.04 WHICH CONCERNS THE QUESTION OF LIGHT AND BULKY ARTICLES UNDER ITEM 145 OF THE DEBTOR'S TARIFF MF-I.C.C. NO. 3, RAISED IN COURT OF CLAIMS NO. 130-60. THE REMAINDER OF THIS AMOUNT $8,788 ($45,995.04 MINUS $37,207.04) CONCERNS MATTERS NOT COVERED BY THAT SUIT. THUS, THIS CARRIER'S INDEBTEDNESS TO THE UNITED STATES ON MATTERS OTHER THAN THOSE INVOLVED IN THE SUIT, AS OF SEPTEMBER 15, 1960, IS $52,237.44 ($43,449.44 PLUS $8,788).

THE RECORD INDICATES THE CARRIER HAS NOT LIQUIDATED THE INDEBTEDNESS OF $8,788. NEITHER HAS IT REFUNDED THE OVERPAYMENTS AGGREGATING $43,449.44 MADE AFTER AUGUST 26, 1958. COLLECTION OF THIS LATTER AMOUNT OF $43,449.44 IS SUBJECT TO THE TIME LIMITATION PRESCRIBED IN THE ACT OF AUGUST 28, 1958, PUBLIC LAW NO. 58-762, 72 STAT. 859, REDUCING TO A PERIOD OF THREE YEARS THE TIME WITHIN WHICH DEDUCTIONS MAY BE MADE FOR OVERCHARGES DETERMINED IN OUR AUDIT OF TRANSPORTATION CHARGES. IF SUCH DEDUCTIONS ARE NOT SO MADE, THE RIGHT APPEARS TO BE LOST. SEE, IN THIS CONNECTION OUR DECISION OF AUGUST 15, 1960, B 143594, 40 COMP. GEN. 101, TO THE STRICKLAND TRANSPORTATION COMPANY, INC., COPY ATTACHED.

THUS, THE AMOUNT WITHHELD, $31,641.80, IS CONSIDERABLY LESS THAN THE INDEBTEDNESS OF $52,237.44 WHICH IS NOT IN ISSUE AND WILL NOT BE DECIDED BY THE COURT OF CLAIMS ACTION. IF COLLECTION OF $43,449.44 OF SUCH $52,237.44 IS NOT EFFECTED WITHIN THREE YEARS OF THE DATES OF THE PAYMENTS, THE RIGHT TO DEDUCT WILL APPARENTLY BE EXTINGUISHED. ALSO, NO ARRANGEMENT HAS BEEN SUGGESTED BY YOU WHEREBY THE GOVERNMENT WOULD BE PROTECTED AS TO THE AMOUNTS OVERPAID PRIOR TO THE EFFECTIVE DATE OF PUBLIC LAW 58-762 AND THE FACT THAT A SUIT INVOLVING THE SAME ISSUE IS PRESENTLY BEFORE A COURT CONSTITUTES NO BASIS FOR WITHHOLDING DEDUCTION ACTION AS TO OTHER AMOUNTS DETERMINED IN OUR AUDIT TO HAVE BEEN OVERPAID. AS YOU KNOW SUCH SUITS OFTEN ARE DISCONTINUED, WITHDRAWN OR COMPROMISED SO THAT NO FINAL JUDICIAL DETERMINATION RESULTS THEREFROM WHICH COULD BE APPLIED TO SUCH OVERPAYMENTS. AND, IF DEDUCTION ACTION WERE DELAYED PENDING A JUDICIAL DETERMINATION OF THE ISSUE IN OTHER CASES--- WHICH MIGHT NOT RESULT THEREFROM--- IT IS ENTIRELY LIKELY THAT THE INTERESTS OF THE UNITED STATES WOULD SUFFER DUE TO CHANGE IN THE CARRIER'S FINANCIAL CONDITION, BECAUSE IT HAS DISCONTINUED BUSINESS, OR BECAUSE THE VOLUME OF BUSINESS DONE BY IT WITH THE GOVERNMENT HAS SO DECREASED THAT BILLS THEN DUE THE CARRIER FROM WHICH DEDUCTION COULD BE MADE UNDER 49 U.S.C. 66 WOULD BE INSUFFICIENT TO PERMIT RECOVERY OF THE OVERPAYMENTS. PARTICULARLY IS THIS SO WHERE, AS IN THIS CASE, THE OVERPAYMENTS ARE IN SUBSTANTIAL AMOUNTS.

THUS, SINCE THE INTERESTS OF THE UNITED STATES PRECLUDE THE REFUND OF THE AMOUNTS WITHHELD BY DEDUCTION AND THE REMOVAL OF THE DEBTOR'S NAME FROM THE "HOLD-UP LIST," YOUR REQUEST MUST BE DENIED. THE AMOUNT WITHHELD TO DATE WILL BE APPLIED TO PARTIALLY LIQUIDATE THE OVERPAYMENTS, AS AUTHORIZED AND REQUITED BY 49 U.S.C. 66.