B-157263, DEC. 22, 1965

B-157263: Dec 22, 1965

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TO HOUSEHOLD GOODS CARRIERS' BUREAU: FURTHER REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 2. AN EARLIER LETTER RELATIVE TO THE SETTLEMENT OF CLAIMS OF HOUSEHOLD GOODS CARRIERS FOR REIMBURSEMENT OF TRANSPORTATION CHARGES FOR MILITARY SHIPMENTS TO OVERSEAS AREAS WHICH WERE ROUTED VIA COMMERCIAL WATER TRANSPORTATION RATHER THAN VIA THE MILITARY SEA TRANSPORTATION SERVICE (MSTS). YOU REQUEST THAT WE SETTLE SUCH CLAIMS WITHOUT REQUIRING A CERTIFICATE TO THE EFFECT THAT THERE WAS NO MSTS CONTROLLED SHIPPING SPACE WHICH MIGHT HAVE BEEN USED IN EACH INSTANCE WITHOUT EXPENSE TO THE GOVERNMENT. THERE APPARENTLY ARE SEVERAL HUNDRED SHIPMENTS IN THIS CATEGORY OF HOUSEHOLD GOODS CARRIERS' CLAIMS. THE SHIPMENTS WERE TENDERED TO HOUSEHOLD GOODS CARRIERS UNDER THROUGH GOVERNMENT BILLS OF LADING WHICH SPECIFIED THAT THE OCEAN TRANSPORTATION WAS TO BE VIA MSTS AND THEREBY SUBJECT TO CERTAIN RATES FILED BY THE CARRIERS FOR THAT TYPE OF SERVICE.

B-157263, DEC. 22, 1965

TO HOUSEHOLD GOODS CARRIERS' BUREAU:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 2, 1965, AND AN EARLIER LETTER RELATIVE TO THE SETTLEMENT OF CLAIMS OF HOUSEHOLD GOODS CARRIERS FOR REIMBURSEMENT OF TRANSPORTATION CHARGES FOR MILITARY SHIPMENTS TO OVERSEAS AREAS WHICH WERE ROUTED VIA COMMERCIAL WATER TRANSPORTATION RATHER THAN VIA THE MILITARY SEA TRANSPORTATION SERVICE (MSTS). YOU REQUEST THAT WE SETTLE SUCH CLAIMS WITHOUT REQUIRING A CERTIFICATE TO THE EFFECT THAT THERE WAS NO MSTS CONTROLLED SHIPPING SPACE WHICH MIGHT HAVE BEEN USED IN EACH INSTANCE WITHOUT EXPENSE TO THE GOVERNMENT.

THERE APPARENTLY ARE SEVERAL HUNDRED SHIPMENTS IN THIS CATEGORY OF HOUSEHOLD GOODS CARRIERS' CLAIMS. THE SHIPMENTS WERE TENDERED TO HOUSEHOLD GOODS CARRIERS UNDER THROUGH GOVERNMENT BILLS OF LADING WHICH SPECIFIED THAT THE OCEAN TRANSPORTATION WAS TO BE VIA MSTS AND THEREBY SUBJECT TO CERTAIN RATES FILED BY THE CARRIERS FOR THAT TYPE OF SERVICE. IF THESE INSTRUCTIONS HAD BEEN FOLLOWED, NO CHARGES FOR OCEAN TRANSPORTATION WOULD HAVE BEEN DUE THE CARRIERS. THE CARRIERS, HOWEVER, MOVED THE SHIPMENTS VIA COMMERCIAL WATER TRANSPORTATION AND COLLECTED CHARGES ACCORDINGLY. IN THE ABSENCE OF WRITTEN DIVERSION ORDERS AUTHORIZING A CHANGE IN ROUTING, THE COMMERCIAL OCEAN CHARGES WERE CONSIDERED BY OUR OFFICE TO BE IN EXCESS OF THOSE THAT WOULD HAVE BEEN PROPER HAD THE SERVICES BEEN FURNISHED BY MSTS IN ACCORDANCE WITH THE BILL OF LADING CONTRACT. THEREFORE, OVERCHARGES WERE STATED IN OUR AUDIT OF THE CARRIER'S ACCOUNTS AND COLLECTIONS EFFECTED SO AS TO EXCLUDE THE COMMERCIAL OCEAN FACTOR FROM THE TOTAL CHARGES ORIGINALLY ASSESSED BY THE CARRIERS.

ONE OF THE INVOLVED CARRIERS--- U.S. VAN LINES, INC.--- FILED SUIT IN THE UNITED STATES COURT OF CLAIMS (NO. 272-64) TO RECOVER AMOUNTS DEDUCTED BY OUR OFFICE ON THE BASIS OF FREIGHT CHARGES ESTABLISHED IN THE GOVERNING RATE TENDER FOR COMMERCIAL STEAMSHIP SERVICES. THIS SUIT WAS SETTLED OUT OF COURT RESULTING IN PAYMENT OF OCEAN CHARGES BASED ON THE SHIPPING CONTRACT RATES MAINTAINED BY MSTS. NO ADDITIONAL PORT HANDLING CHARGES WERE INCLUDED IN THE SETTLEMENT SINCE AN ADEQUATE ALLOWANCE HAD BEEN MADE IN/THE GOVERNMENT AUDIT OF THE TRANSPORTATION CHARGES FOR LOADING AND UNLOADING THE CONTAINERS INVOLVED. THE PROPOSED SETTLEMENT IN THIS SUIT RESTED ON A GIVEN SET OF FACTS FOR THE SHIPMENTS INVOLVED FOR WHICH THE RECORD HAD BEEN DEVELOPED BY THE PLAINTIFF AND MSTS. THE RECORD INCLUDED (1) COPIES OF COMMERCIAL OCEAN BILLS OF LADING SUPPLIED BY THE PLAINTIFF EVIDENCING THE OCEAN SEGMENT OF THE THROUGH MOVEMENT AND SHOWING THE DIMENSIONS OF THE CONTAINERS USED FOR THE PROPERTY SHIPPED, (2) A LETTER FROM MSTS SHOWING THE WEIGHT OF THE SHIPMENTS CONVERTED TO CUBIC DISPLACEMENT THROUGH USE OF AN ESTIMATED WEIGHT FACTOR OF 6 1/2 POUNDS PER CUBIC FOOT AND THE SHIPPING CONTRACT RATES APPLICABLE TO THE SHIPMENTS HAD THEY BEEN ROUTED BY MSTS, AND (3) A STATEMENT BY MSTS THAT THEY WERE UNABLE AT THAT DATE TO DETERMINE THE APPLICABLE OCEAN SHIPPING CHARGES HAD THE BILL OF LADING ROUTING BEEN OBSERVED BECAUSE OF THE POSSIBILITY OF A REDUCTION IN THE OCEAN CHARGES UNDER THE SHIPPING AGREEMENT WHEN THE TONNAGE SHIPPED REACHED A CERTAIN VOLUME.

THUS IT MAY BE SEEN THAT IN REACHING THE COMPROMISE AGREEMENT IN THE U.S. VAN LINES CASE, THE GOVERNMENT USED CERTAIN CRITICAL FACTORS IN ORDER TO ARRIVE AT A REASONABLE APPROXIMATION OF THE OCEAN FREIGHT CHARGES ON A CONSTRUCTED BASIS. WE WOULD BE WILLING TO APPLY A SIMILAR FORMULA TO SETTLE OTHER CLAIMS FROM HOUSEHOLD GOODS CARRIERS INVOLVING COMPARABLE FACTUAL SITUATIONS.

IN REACHING THE COMPROMISE AGREEMENT IN THE U.S. VAN LINES CASE, HOWEVER, NO ATTEMPT WAS MADE TO PROCURE A CERTIFICATE FROM MSTS THAT THERE WAS NO MSTS CONTROLLED SHIPPING SPACE WHICH MIGHT HAVE BEEN USED FOR THE SEVERAL SHIPMENTS WITHOUT EXPENSE TO THE GOVERNMENT. THIS MAY NOT HAVE BEEN FELT NECESSARY AT THAT TIME SINCE PRIOR EXPERIENCE INDICATED NO INSTANCES OF THE AVAILABILITY OF MSTS CONTROLLED SHIPPING WITHOUT EXPENSE TO THE GOVERNMENT. WE HAVE SINCE LEARNED FROM MSTS THAT BETWEEN CERTAIN ORIGINS AND DESTINATIONS THIS TYPE OF SHIPPING WAS AVAILABLE TO THE GOVERNMENT. IN SUCH CASES, THEREFORE, NO ALLOWANCES FOR OCEAN CHARGES COULD BE MADE TO THE HOUSEHOLD GOODS CARRIERS, AND THE NEED FOR THE INDICATED CERTIFICATE CONTINUES.

IN ANY EVENT, MSTS WILL HAVE TO BE CONTACTED TO DETERMINE THE APPLICABLE SHIPPING CONTRACT RATES AND THE PORT HANDLING CHARGES FOR EACH INDIVIDUAL MOVEMENT INVOLVED BEFORE WE WILL BE ABLE TO SETTLE PARTICULAR CLAIMS. WILL ALSO BE NECESSARY TO ASCERTAIN WHETHER OR NOT MSTS CONTROLLED SHIPPING WAS AVAILABLE. FURTHER HANDLING OF THE CLAIMS FILED OR TO BE FILED WITH OUR OFFICE BY HOUSEHOLD GOODS CARRIERS FOR OCEAN CHARGES ON SHIPMENTS OF THE INDICATED NATURE THUS WILL DEPEND ON THE ADEQUACY OF THE RECORD MADE AVAILABLE CONSISTENT WITH THE BASIC REQUIREMENTS WE HAVE SET FORTH IN THIS LETTER.