B-150290, JUL. 29, 1963

B-150290, JUL. 29, 1963

TO THE ATCHISON, TOPEKA AND SANTA FE RAILWAY COMPANY:

WE REFER TO YOUR LETTER OF NOVEMBER 12, 1962, FILE G-634690, REQUESTING REVIEW OF THE DISALLOWANCE OF YOUR CLAIM FOR $94.97 IN ADDITIONAL FREIGHT CHARGES ON A SHIPMENT OF ENGINES FROM FARMINGDALE, NEW YORK, TO OAKLAND, CALIFORNIA, WHICH WAS ACCORDED TRANSIT PRIVILEGES AT MIDDLETOWN, PENNSYLVANIA, UNDER EXECUTIVE COMMITTEE--- WESTERN TRAFFIC ASSOCIATION SECTION 22 QUOTATION 38.

IN YOUR REPORT FOR REVIEW YOU INDICATE THAT THIS SETTLEMENT IS REPRESENTATIVE OF DISALLOWANCES RECEIVED ON OTHER SUPPLEMENTAL BILLS INVOLVING SHIPMENTS ON WHICH THE ACTUAL WEIGHTS OF BOTH THE INBOUND AND OUTBOUND MOVEMENTS WERE LESS THAN THE MINIMUM WEIGHT GOVERNING THE THROUGH MOVEMENT. YOU REQUEST OUR VIEWS AS TO THE PROPER APPLICATION TO BE GIVEN TO ITEM 15 PARAGRAPH (G) OF QUOTATION 38. SINCE BOTH YOUR COMPUTATIONS AND OURS ARE IN AGREEMENT THAT THE CHARGES ON THE THROUGH MOVEMENT ARE $1,308.44 BASED ON A RATE OF $3.75 PER HUNDRED POUNDS ON A 30,000 POUND MINIMUM (PLUS 15 PERCENT INCREASE) AND PLUS APPLICABLE TRANSIT CHARGES, YOUR INQUIRY PERTAINS SOLELY TO THE AMOUNT OF INBOUND CHARGES TO BE CREDITED AGAINST THE THROUGH CHARGES ON THE SHIPMENT.

THE INBOUND MOVEMENT FROM FARMINGDALE, NEW YORK, TO MIDDLETOWN, PENNSYLVANIA, INCLUDING 300 POUNDS OF DUNNAGE, WEIGHED 26,550 POUNDS (SHOWN IN YOUR LETTER AS 26,580) AND WAS SUBJECT TO A RATE OF 93 CENTS PER HUNDRED POUNDS (PLUS 15 PERCENT INCREASE) ON A MINIMUM WEIGHT OF 38,880 POUNDS. THE OUTBOUND MOVEMENT FROM MIDDLETOWN, PENNSYLVANIA,TO OAKLAND, CALIFORNIA, WEIGHED 25,800 POUNDS, AND WAS SUBJECT TO A THROUGH RATE OF $3.75 PER HUNDRED POUNDS (PLUS 15 PERCENT INCREASE) ON A MINIMUM WEIGHT OF 30,000 POUNDS. IN OUR SETTLEMENT, CREDIT WAS TAKEN FOR ALL OF THE CHARGES OF $415.82 PAID TO THE TRANSIT POINT.

YOU INVITE ATTENTION TO THE PROVISIONS OF ITEM 15 (G) OF QUOTATION 38 WHICH READS AS FOLLOWS:

"WHEN THE ACTUAL TRANSIT WEIGHT OF THE INBOUND AND OUTBOUND SHIPMENT IS LESS THAN THE MINIMUM WEIGHT GOVERNING THE THROUGH RATE, AND THE ACTUAL TRANSIT WEIGHT OF THE OUTBOUND SHIPMENT IS THE SAME OR LESS THAN THE ACTUAL WEIGHT OF THE INBOUND SHIPMENT, THE DIFFERENCE BETWEEN THE ACTUAL AND MINIMUM WEIGHT, INBOUND AND OUTBOUND, WILL BE CONSIDERED TRANSIT TONNAGE. A TRANSIT CREDIT WILL NOT BE ALLOWED FOR ANY INBOUND WEIGHT NOT INCLUDED IN THE OUTBOUND SHIPMENT.' YOU APPARENTLY URGE THAT CREDIT FOR THE INBOUND CHARGES PAID SHOULD BE BASED ON THE 25,800 POUNDS ACTUAL OUTBOUND TONNAGE AND 4,200 POUNDS OF DEFICIT TONNAGE TO MAKE THE THROUGH MINIMUM WEIGHT OF 30,000 POUNDS. YOU ALSO NOTE THAT UNDER THIS ITEM A CREDIT SLIP WILL NOT BE ISSUED FOR THE ADDITIONAL WEIGHT INCLUDED IN THE WEIGHT OF THE INBOUND MOVEMENT BUT WHICH DID NOT MOVE OUTBOUND. THUS IT SEEMS TO BE YOUR CONTENTION THAT CREDIT FOR THE INBOUND CHARGES SHOULD BE COMPUTED ON THE 30,000 POUNDS AT THE 93 CENTS PER HUNDRED POUNDS RATE (PLUS 15 PERCENT INCREASE) PAID TO THE TRANSIT POINT.

UPON THE EXERCISE OF THE TRANSIT PRIVILEGE, HOWEVER, THE INBOUND LOSES ITS IDENTITY AS A COMPLETED SHIPMENT AND BECOMES A PART OF THE THROUGH MOVEMENT UPON WHICH THE THROUGH RATE APPLIES. FREDONIA LINSEED OIL WORKS CO. V. ATCHISON, T. AND S.F.RY.CO., 201 I.C.C. 41; SAWDUST SALES CO. V. BALTIMORE AND O.R.CO., 186 I.C.C. 265, 268; STALEY MANUFACTURING CO. TERMINAL ALLOWANCE, 245 I.C.C. 383, 392 (FOOTNOTE). THE ENTIRE MOVEMENT IS TREATED AS IF THE SHIPMENT HAD MOVED FROM ORIGIN TO DESTINATION WITHOUT A STOP FOR TRANSIT. BALTIMORE AND O.R.CO. V. UNITED STATES, 24 F.SUPP. 734, 735. WHEELOCK AND BIERD V. AKRON, C. AND Y.RY. CO., 179 I.C.C. 517, 520-521. CHICAGO BOARD OF TRADE V. ANN ARBOR R.CO., 39 I.C.C. 643, 651; LARABOE FLOUR MILLS CO. V. CHICAGO, B. AND Q.R.CO., 223 I.C.C. 55, 64; KANSAS CITY BOARD OF TRADE V. ATCHISON, T. AND S.F.RY.CO., 69 I.C.C. 185, 189.

THE INBOUND RATE IS NOT APPLICABLE TO THE SHIPMENT, AND THE PRINCIPLES APPLICABLE TO THE THROUGH SHIPMENT GOVERN THE TRANSPORTATION. IN THE ADJUSTMENT OF THE CHARGES THE CARRIERS RECEIVE THE THROUGH RATE APPLICABLE ON THE THROUGH SHIPMENT--- THE CHARGES FROM ORIGINAL POINT OF ORIGIN TO ULTIMATE DESTINATION, LESS THE INBOUND CHARGES ALREADY PAID. DUCK RIVER GRAIN CO. V. NASHVILLE, C. AND ST.L.RY., 160 I.C.C. 28, 29-30; BEACON MILLING CO. , INC., V. NEW YORK C.R.CO., 157 I.C.C. 635, 636; JOHN W. ESHELMAN AND SONS V. ARKANSAS, C.R.CO., 87 I.C.C. 285, 290; SOUTHERN CREOSOTING INDUSTRIES V. ALABAMA C.S.R.CO., 153 I.C.C. 625, 627.

ITEM 6, PARAGRAPH (A) OF QUOTATION 38 PROVIDES THAT WHEN RESHIPPED FROM THE TRANSIT POINT EACH SHIPMENT MADE FROM INITIAL POINT OF ORIGIN SHALL BE SUBJECT AND ENTITLED TO THE CARLOAD RATE FROM SUCH POINT OF ORIGIN TO THE PORT OF TRANSSHIPMENT OR RAILHEAD. ITEM 15 PARAGRAPH (G) OF QUOTATION 38 PROVIDES THAT WHEN THE ACTUAL TRANSIT WEIGHT OF BOTH THE INBOUND AND OUTBOUND MOVEMENTS ARE LESS THAN THE MINIMUM WEIGHT GOVERNING THE THROUGH RATE THE DIFFERENCE BETWEEN THE ACTUAL AND MINIMUM WEIGHTS WILL BE CONSIDERED AS IF TRANSITED AND A CREDIT SLIP WILL NOT BE ISSUED FOR ANY INBOUND WEIGHT NOT INCLUDED IN THE OUTBOUND MOVEMENT. HOWEVER, SUCH PROVISION DOES NOT APPEAR DIRECTLY TO AFFECT THE APPLICABLE CHARGES WHICH SHOULD BE BORNE BY THE GOVERNMENT.

IN THE LIGHT OF THE PRINCIPLES GOVERNING TRANSIT GENERALLY AS SET OUT IN THE DECISIONS OF THE INTERSTATE COMMERCE COMMISSION AND OF THE COURTS REFERRED TO ABOVE, IT IS OUR VIEW THAT THE APPLICABLE CHARGES ARE THOSE BASED ON A THROUGH MOVEMENT, AND THAT TOTAL CHARGES PAID ON THE INBOUND MOVEMENT ARE PROPERLY TO BE CREDITED AGAINST THE THROUGH CHARGES. SUCH THROUGH CHARGES HAVE BEEN PAID AND, UNDER PARAGRAPH 15 (G) OF THE QUOTATION, NO FURTHER ADJUSTMENT OR CREDIT WILL BE GIVEN FOR THE WEIGHT OF THE INBOUND SHIPMENT NOT CARRIED OUTBOUND. THUS THE GOVERNMENT HAS ALREADY PAID TO THE CARRIERS THE THROUGH CHARGES BASED ON THE THROUGH MINIMUM WEIGHT OF 30,000 POUNDS FOR CARRYING 26,550 POUNDS INBOUND AND 25,800 POUNDS OUTBOUND. FOR SUCH CHARGE IT COULD HAVE SHIPPED 30,000 POUNDS INBOUND AND OUTBOUND, A GREATER SERVICE. SEE FRUITS STORED IN TRANSIT IN THE SOUTHWEST, 190 I.C.C. 153, WHERE ON PAGE 157 THE COMMISSION CONDEMNED A TRANSIT MILE WHICH RESULTED IN THE ASSESSMENT OF GREATER CHARGES FOR A LESSER SERVICE. ACCORDINGLY, WE PERCEIVE NO PROPER BASIS FOR ALLOWANCE OF ANY ADDITIONAL CHARGE AND THE SETTLEMENT DISALLOWING YOUR CLAIM FOR $94.97 IN ADDITIONAL CHARGES APPEAR PROPER AND IS SUSTAINED.