B-157878, FEB. 10, 1966

B-157878, FEB. 10, 1966

TO F. J. BOUTELL DRIVEAWAY CO., INC.:

IN YOUR LETTER OF OCTOBER 19, 1964, AND LATER LETTERS, YOU INFORMED THE ARMY FINANCE CENTER, INDIANAPOLIS, INDIANA, THAT YOU DECLINED TO ACCEPT LIABILITY FOR DAMAGE TO A GOVERNMENT AMBULANCE SUSTAINED WHILE BEING TRANSPORTED BY YOUR COMPANY FROM ROMULUS, NEW YORK, TO BROOKLYN ARMY TERMINAL, BROOKLYN, NEW YORK, UNDER GOVERNMENT BILL OF LADING B 3285983, DATED SEPTEMBER 25, 1962. THE DEPARTMENT OF THE ARMY HAS REFERRED THE MATTER TO US FOR CONSIDERATION AND FURTHER HANDLING.

THE RECORD SHOWS THAT THE AMBULANCE INVOLVED WAS ONE OF SIX TRUCK AMBULANCES LOADED AND SECURED ON YOUR VEHICLE BY THE SHIPPING INSTALLATION. YOUR DRIVER ACCEPTED THE SHIPMENT AS LOADED AND SIGNED THE BILL OF LADING WITHOUT EXCEPTION AS TO THE CONDITION OF ANY OF THE VEHICLES. UPON ARRIVAL OF THE SHIPMENT AT DESTINATION, THE RECEIVING CHECKER NOTICED THAT THE AMBULANCE WAS DAMAGED BEFORE IT WAS REMOVED FROM YOUR CARRIER, AND MADE NOTATION OF THE DAMAGE ON THE DOCK RECEIPT (DA FORM 1663). NOTATION OF THE DAMAGE WAS ALSO MADE ON THE BILL OF LADING BEFORE IT WAS SURRENDERED TO YOU FOR FREIGHT BILLING PURPOSES.

BY LETTER OF OCTOBER 4, 1962, THE BROOKLYN ARMY TERMINAL NOTIFIED YOU OF THE DAMAGE, ESTIMATING THE COST OF REPAIR AT $275, AND REQUESTED THAT YOU ARRANGE FOR AN INSPECTION OR FURNISH WAIVER OF INSPECTION IN WRITING. YOUR REPLY OF OCTOBER 30, 1962, YOU DENIED KNOWLEDGE OF THE DAMAGE AND REQUESTED A PHOTOSTATIC COPY OF ANY EXCEPTIONS TAKEN AT THE TIME OF UNLOADING, ACKNOWLEDGED BY YOUR DRIVER. ON DECEMBER 14, 1962, THE BROOKLYN ARMY TERMINAL FURNISHED YOU A COPY OF THE DOCK RECEIPT SHOWING THE NOTATION OF DAMAGE. YOU WERE ALSO SPECIFICALLY REQUESTED TO ADVISE WHETHER YOU WOULD RETRIEVE THE AMBULANCE FOR REPAIR, OR ACCEPT LIABILITY FOR ANY REPAIRS, MADE BY THE GOVERNMENT, INCLUDING TRANSPORTATION COSTS. BY LETTER OF DECEMBER 24, 1962, YOU DECLINED TO ACCEPT ANY LIABILITY ON THE BASIS THAT THE DAMAGE WAS NOT SHOWN ON YOUR OWN DOCUMENTS OR ACKNOWLEDGED BY YOUR DRIVER IN WRITING. SUBSEQUENTLY THE DEPARTMENT OF THE ARMY DETERMINED THAT THE AMBULANCE FRAME WAS DAMAGED BEYOND REPAIR, THAT THE VEHICLE COULD BE REPAIRED ONLY BY REPLACEMENT OF THE FRAME AT AN ESTIMATED COST OF $434, AND THAT REPAIR OF THE VEHICLE IN SUCH MANNER WAS PRECLUDED BY ADMINISTRATIVE REGULATIONS. SINCE DISPOSAL OF THE VEHICLE BY SALE WAS NOT PRACTICAL--- THERE BEING NO APPARENT MARKET FOR USED MILITARY AMBULANCES--- IT WAS EARMARKED FOR CANNIBALIZATION. THE ADMINISTRATIVE OFFICE DETERMINED THE USED-PARTS VALUE OF THE VEHICLE TO BE $700 AND, SUBTRACTING THAT AMOUNT FROM THE BOOK (DEPRECIATED) VALUE OF THE VEHICLE WHEN SHIPPED, FIXED YOU MONETARY LIABILITY TO THE GOVERNMENT AT $1,942.65.

IN YOUR LETTER OF OCTOBER 19, 1964, YOU BASE YOUR DENIAL OF LIABILITY PRIMARILY ON THE FACT THAT THE VEHICLES WERE LOADED ON YOUR VEHICLE AT ORIGIN AND UNLOADED AT DESTINATION BY GOVERNMENT PERSONNEL, UPON THE CONTENTION THAT THE ALLEGED DAMAGE COULD NOT POSSIBLY HAVE OCCURRED DURING THE MOVEMENT, AND UPON THE AFOREMENTIONED CONTENTION THAT THE DELIVERY RECEIPT CONTAINS NO WRITTEN ACKNOWLEDGMENT BY YOUR DRIVER OF THE EXISTENCE OF THE DAMAGE AT THE TIME OF DELIVERY.

WE ARE OF THE VIEW THAT THE FACT THAT THE AMBULANCES WERE LOADED ON YOUR VEHICLE BY THE SHIPPING INSTALLATION DOES NOT ABSOLVE YOUR COMPANY FROM THE LIABILITY OTHERWISE IMPOSED ON IT BY LAW. YOU SUGGEST THAT THE DAMAGE TO THE AMBULANCE MAY HAVE OCCURRED AS IT WAS BEING PLACED UPON YOUR CARRIER UNIT; HOWEVER, YOUR DRIVER, AFTER FULL OPPORTUNITY TO OBSERVE THE LOADED CARGO AND TO DISCOVER THE DAMAGE, HAD IT THEN BEEN APPARENT, SIGNED THE GOVERNMENT BILL OF LADING CERTIFICATE ACKNOWLEDGING RECEIPT OF THE SHIPMENT IN APPARENT GOOD ORDER AND CONDITION. THERE IS NO EVIDENCE IN THE RECORD TO SUGGEST THAT THE DAMAGE RESULTED FROM THE METHOD OF LOADING OR SECURING THE AMBULANCE; IN FACT, AN INSPECTOR AT POINT OF ORIGIN CERTIFIED THAT THE VEHICLES WERE IN EXCELLENT CONDITION AND PROPERLY LOADED, BLOCKED AND BRACED ON YOUR EQUIPMENT.

IN ANY EVENT THE LAW IS WELL SETTLED THAT THE PRIMARY RESPONSIBILITY FOR THE SAFE LOADING AND PACKING OF GOODS FOR SHIPMENT IS THAT OF THE CARRIER, WHO IS LIABLE FOR ITS NEGLIGENCE IN FAILING TO CARRY OUT THAT RESPONSIBILITY. EVEN WHERE THE SHIPPER ASSUMES RESPONSIBILITY FOR LOADING THE CARRIER IS NEVERTHELESS LIABLE IF THE LOADING DEFECTS COULD HAVE BEEN DISCERNED THROUGH ORDINARY OBSERVATION. SEE HANNIBAL V. SWIFT, 79 U.S. 262 (1870) AND UNITED STATES V. SAVAGE TRUCK LINES, 209 F.2D 442 (1953), CERTIORARI DENIED 347 U.S. 952.

OUR FILE CONTAINS A SWORN STATEMENT BY THE RECEIVING CHECKER, MR. JOSEPH BELMONTE, TO THE EFFECT THAT UPON ARRIVAL OF THE SHIPMENT AT DESTINATION THE DAMAGE WAS NOTED AND MARKED ON THE AFOREMENTIONED DOCK RECEIPT WHILE THE "PIECE WAS STILL ON CARRIER," AND THAT THE INSPECTOR WAS NOTIFIED AND VERIFIED THE DAMAGE. THUS IT IS CLEAR THAT THE DOCK RECEIPT AND THE BILL OF LADING RECORD CAN BE CORROBORATED BY THE PERSONAL TESTIMONY OF BOTH THE CHECKER AND THE INSPECTOR. IT IS TRUE THAT THE DOCK RECEIPT DOES NOT CONTAIN THE SIGNATURE OF YOUR DRIVER ACKNOWLEDGING THE AMAGE; BUT THE FUNCTION OF THE FORM IS THAT OF A DELIVERY RECEIPT, NOT AN INSPECTION REPORT. NO PROVISION IS MADE EITHER ON THE FORM OR IN THE ESTABLISHED PROCEDURE FOR OBTAINING THE DRIVER'S SIGNATURE. MOREOVER, WE ARE AWARE OF NO LEGAL AUTHORITIES SUPPORTING THE PROPOSITION THAT A CARRIER IS LEGALLY LIABLE ONLY FOR SUCH DAMAGE AS MAY HAVE BEEN ACKNOWLEDGED BY ITS DRIVER IN WRITING.

YOUR CONTENTION THAT THE ALLEGED DAMAGE COULD NOT POSSIBLY HAVE OCCURRED WHILE IN YOUR POSSESSION REFLECTS YOUR IMPRESSION THAT IT IS FIRST INCUMBENT ON THE GOVERNMENT TO SHOW SOME SPECIFIC NEGLIGENCE ON THE PART OF YOUR COMPANY WHICH COULD HAVE CAUSED THE DAMAGE. SUCH IS NOT THE CASE. THE LAW IS WELL SETTLED THAT UNDER 49 U.S.C. 20 (11), MADE APPLICABLE TO CARRIERS BY MOTOR VEHICLE BY 49 U.S.C. 319, EVIDENCE THAT GOODS ARE DELIVERED TO A CARRIER IN GOOD CONDITION AND THAT THE CARRIER DELIVERED THEM IN DAMAGED CONDITION RAISES THE PRESUMPTION THAT THE DAMAGE RESULTED FROM THE CARRIER'S NEGLIGENCE, AND THE BURDEN OF PROOF IS THEN ON THE CARRIER TO SHOW THAT THE DAMAGE RESULTED FROM SOME FACTOR FOR WHICH IT IS HELD NOT LEGALLY RESPONSIBLE. SILVER LINING, INC. V. SHEIN, 117 A.2D 182 (1955); TUSCHMAN V. PENNSYLVANIA R.CO., 230 F.2D 787 (1956); UNITED STATES V. MISSISSIPPI VALLEY BARGE LINE CO., 285 F.2D 381 (1960); HAMILTON FOODS, INC. V. ATCHISON, TOPEKA AND SANTA FE RAILWAY CO., 83 F.SUPP. 478 (1948); MISSOURI PACIFIC RAILROAD COMPANY V. ELMORE AND STAHL, 377 U.S. 134 (1964).

THE BILL OF LADING RECORD HERE INVOLVED ESTABLISHES SUCH A PRIMA FACIE CASE, AND IS SUPPORTED BY STATEMENTS THAT ALL THE AUTOMOBILES WERE CAREFULLY INSPECTED AND FOUND IN GOOD CONDITION BOTH BEFORE AND AFTER LOADING, AND BY THE AFOREMENTIONED STATEMENT OF MR. BELMONTE AS TO HIS DISCOVERY OF THE DAMAGE BEFORE THE VEHICLE WAS REMOVED FROM YOUR CARRIER UNIT. WE CONCLUDE, THEREFORE, THAT THE PRESENT RECORD ESTABLISHES YOUR LEGAL LIABILITY FOR THE DAMAGE TO THE AMBULANCE.

WE BELIEVE, HOWEVER, THAT THE CORRECTNESS OF THE ADMINISTRATIVE DETERMINATION AS TO THE AMOUNT OF THE DAMAGES IS OPEN TO DOUBT. UNDER THE LANGUAGE OF 49 U.S.C. 20 (11) CARRIERS ARE MADE LIABLE TO SHIPPERS FOR THE "FULL, ACTUAL LOSS" SUSTAINED. GULF, COLORADO AND SANTA FE RAILWAY COMPANY V. TEXAS PACKING COMPANY, 244 U.S. 31, 37 (1917); REIDER V. THOMPSON, 197 F.2D 158 (1952). IN ORDER THAT THIS MATTER MAY BE TERMINATED WITHOUT FURTHER PROCESSING IT SEEMS APPROPRIATE THAT THE "FULL, ACTUAL LOSS" MAY BE RECOGNIZED FOR THIS PURPOSE AS BEING $434, ESTIMATED AS THE BASIC COST OF REPAIRS BY A RARITAN ARSENAL INSPECTOR IN DECEMBER 1962.

ACCORDINGLY, YOUR CHECK IN THAT AMOUNT WILL BE ACCEPTED IN FULL SETTLEMENT OF THE GOVERNMENT'S CLAIM. SUCH CHECK, TO BE SUBMITTED IN 60 DAYS, SHOULD BE MADE PAYABLE TO THE "UNITED STATES GENERAL ACCOUNTING OFFICE" AND FORWARDED TO THE TRANSPORTATION DIVISION, UNITED STATES GENERAL ACCOUNTING OFFICE, WASHINGTON, D.C., 20548, WITH CITATION TO FILE B-157878.