B-159877, APRIL 19, 1967, 46 COMP. GEN. 740

B-159877, APRIL 19, 1967, 46 COMP. GEN. 740

TRANSPORTATION - FREIGHT FORWARDERS - COMMON CARRIER LIABILITY TO EXONERATE FREIGHT FORWARDERS--- CARRIERS IN DEALING WITH CUSTOMERS, ALTHOUGH SHIPPERS IN THEIR RELATIONSHIP WITH UNDERLYING CARRIERS, AND, THEREFORE, SUBJECT TO SECTION 20 (11) OF THE INTERSTATE COMMERCE ACT--- FROM LIABILITY FOR THE DAMAGE TO ELECTRICAL INSTRUMENTS SHIPPED BY THE MANUFACTURER TO A GOVERNMENT CONTRACTOR, THE FORWARDERS UNDER SECTION 20 (11) MUST AFFIRMATIVELY SHOW THE DAMAGE WAS OCCASIONED BY THE SHIPPER, ACTS OF GOD, THE PUBLIC ENEMY, PUBLIC AUTHORITY, OR THE INHERENT VICE OR NATURE OF THE COMMODITY, AND THE BILLS OF LADING EVIDENCING THAT THE DAMAGE TO THE EQUIPMENT WAS OCCASIONED BY ROUGH HANDLING EN ROUTE, A PRIMA FACIE CASE OF CARRIER LIABILITY IS ESTABLISHED, AND THE FREIGHT FORWARDERS UNABLE TO MEET THE BURDEN OF PROVING THEY WERE FREE OF NEGLIGENCE IN HANDLING THE SHIPMENT ARE LIABLE TO THE GOVERNMENT FOR THE DAMAGE. PROPERTY - PUBLIC - DAMAGE - LOSS, ETC. - PACKING, ETC., SUFFICIENCY TO ESCAPE LIABILITY FOR DAMAGES TO A SHIPMENT ON THE BASIS OF "IMPROPER PACKING," A CARRIER MUST SHOW THE IMPROPER PACKING WAS THE SOLE CAUSE OF DAMAGE, THAT THE DEFECT WAS LATENT AND CONCEALED, AND NOT DISCERNIBLE TO THE ORDINARY OBSERVATION OF AGENTS OF THE CARRIER, AND THAT THE CARRIER WAS FREE OF NEGLIGENCY IN HANDLING THE SHIPMENT. THEREFORE, A CARRIER ACCEPTING A SHIPMENT ALLEGED TO HAVE BEEN DEFECTIVELY PACKAGED--- A DISCERNIBLE AND NOT A LATENT DEFECT--- WHICH IT SHOULD HAVE REFUSED TO ACCEPT, AND UNABLE TO PROVE THAT "NO FAULT ON ITS PART CONTRIBUTED TO THE CAUSE OF THE DAMAGE" IS LIABLE FOR THE DAMAGE CLAIM OF THE GOVERNMENT. CLAIMS - EVIDENCE TO SUPPORT - ADMINISTRATIVE RECORDS CONTRARY TO ALLEGATIONS - DOUBTS RESOLVED IN FAVOR OF GOVERNMENT IN A DISPUTE OVER A QUESTION OF FACT, EVIDENCE FURNISHED BY THE CARRIER CASTING SOME DOUBT ON THE ADEQUACY OF THE PACKING METHODS USED BY THE SHIPPER IS NOT ENOUGH TO SET ASIDE A CONTRARY CONCLUSION IN AN ADMINISTRATIVE REPORT UNDER THE RULE OF THE ACCOUNTING OFFICES OF THE GOVERNMENT TO ACCEPT AN ADMINISTRATIVE REPORT AS CORRECT IN THE ABSENCE OF SUFFICIENTLY CONVINCING CONTRARY EVIDENCE.

TO THE REPUBLIC CARLOADING AND DISTRIBUTING CO. INC., APRIL 19, 1967:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 21, 1967, AND TO EARLIER LETTERS, RELATIVE TO OUR DAMAGE CLAIM TK-826364, FOR $54,404.48 (YOUR CLAIM 74428), WHICH REPRESENTS THE COST OF REPLACING FOUR BRUSH MARK 200 RECORDERS, MODEL 15-1787-71, DAMAGED WHILE BEING TRANSPORTED UNDER GOVERNMENT BILLS OF LADING B-8112193 AND B-8480902.

THE DAMAGE CLAIM WAS REFERRED HERE FOR COLLECTION BY THE NATIONAL AERONAUTICS AND SPACE ADMINISTRATION (NASA). AT YOUR REQUEST, WE WITHHELD COLLECTION ACTION AND HAVE SINCE RECEIVED FROM YOU ADDITIONAL EVIDENCE FURNISHED WITH YOUR LETTERS DATED OCTOBER 7, 11, 28, DECEMBER 22, 1966, AND MARCH 21, 1967. ALSO, NASA SENT US A DETAILED REPORT ON THE DAMAGE CLAIM.

WE HAVE CAREFULLY REVIEWED THE RECORD IN THIS CASE--- INCLUDING THE PHOTOGRAPHS OF THE DAMAGED CONTAINERS ENCLOSED WITH YOUR MARCH 21ST LETTER --- AND HAVE CONCLUDED THAT WE CANNOT EXONERATE REPUBLIC FROM LIABILITY FOR THE DAMAGE CLAIM.

THE CLAIM ARISES FROM DAMAGES DISCOVERED ON TWO SHIPMENTS OF RECORDERS DESCRIBED ON THE BILLS OF LADING AS ELECTRICAL INSTRUMENTS, NOI. THEY WERE TENDERED TO YOUR COMPANY IN JULY 1967 AT CLEVELAND, OHIO, BY THE SHIPPER, BRUSH INSTRUMENTS, WHO CONSIGNED THEM TO GENERAL DYNAMICS) ASTRONAUTICS, SAN DIEGO, CALIFORNIA, A NASA CONTRACTOR. ONE SHIPMENT OF FOUR CARTONS, WEIGHING A TOTAL OF 2,056 POUNDS, IS COVERED BY YOUR COMMERCIAL BILL OF LADING DATED JULY 16, 1964 (SHIPPER'S NO. 71-10620); THE OTHER SHIPMENT OF THREE CARTONS, WEIGHING 1,524 POUNDS, IS COVERED BY YOUR COMMERCIAL BILL OF LADING DATED JULY 31, 1964 (SHIPPER'S NO. 71- 11308). BOTH BILLS OF LADING WERE CONVERTED AT DESTINATION TO GOVERNMENT BILLS OF LADING AND CONTAIN THESE ANNOTATIONS:

CARRIER PLEASE NOTE:

CAUTION--- VERY DELICATE INSTRUMENTS

DO NOT DROP--- PLEASE HANDLE WITH GREAT CARE HIGH

VALUE EQUIPMENT

NOTE: TO BE CONVERTED TO GOV-T BILL OF LADING AT DEST.

THE FIRST SHIPMENT ARRIVED AT THE CONSIGNEE'S PLANT ON JULY 27, 1964, AND REPUBLIC'S DELIVERED RECEIPT OR FREIGHT BILL CONTAINS THE HANDWRITTEN NOTATION "ALL CTNS GOUGED; " THE SECOND SHIPMENT ARRIVED AT THE CONSIGNEE'S PLANT ON AUGUST 11, 1964, AND THE RECEIPT CONTAINS THE HANDWRITTEN PHRASE "3 CTNS SHOW DAMAGE.'

THE SECOND SHIPMENT WAS UNPACKED ON AUGUST 11, 1964, AND A REPORT CONCERNING THE DAMAGE PREPARED ON THAT DATE BY THE CONSIGNEE'S TRAFFIC REPRESENTATIVE INDICATES THAT AN INSPECTION BY AN INSPECTOR OF THE ATCHISON, TOPEKA AND SANTA FE RAILROAD (SANTA FE) WAS SCHEDULED FOR AUGUST 14, 1964. IN THE REPORT, THE TRAFFIC REPRESENTATIVE STATES THAT IN HIS OPINION, THE PACKING WAS ADEQUATE FOR THE MODE OF TRANSPORTATION USED; AND THAT THE DAMAGE WAS CAUSED BY "ROUGH HANDLING, ITEM RECEIVED A SEVERE IMPACT. IT IS POSSIBLE THAT THE ITEMS WERE UP-SET WHILE IN TRANSIT.'

THE FIRST SHIPMENT WAS UNPACKED ON AUGUST 15 AND A SIMILAR REPORT PREPARED BY THE SAME TRAFFIC REPRESENTATIVE INDICATES THAT IT WAS TO BE INSPECTED ON THE SAME DAY AS THE SECOND SHIPMENT; IT ALSO CONTAINS THE SAME OBSERVATION CONCERNING PACKING AND A SIMILAR EXPLANATION OF THE CAUSE OF THE DAMAGE. PHOTOGRAPHS OF THE CARTONS, APPARENTLY SIMILAR TO THE ONES SENT HERE WITH YOUR LETTER OF MARCH 21ST, WERE TAKEN BY THE CONSIGNEE BEFORE AND DURING THE UNPACKING.

THE INSPECTOR'S REPORTS, EACH ON A SANTA FE FROM HEADED "DAMAGE INSPECTED AFTER DELIVERY" SHOW, AMONG OTHER THINGS, THAT IN THE INSPECTOR'S OPINION, THE DAMAGE TO THE CONTAINERS WAS SUFFICIENTLY EVIDENT TO HAVE BEEN NOTED BY NORMAL VISUAL INSPECTION WHEN UNLOADED AND THAT THE CONDITION OF THE CONTENTS WAS A RESULT OF THE ACTION CAUSING THE DAMAGE TO THE CONTAINERS. IN DESCRIBING THE NATURE AND EXTENT OF DAMAGE TO THE SECOND SHIPMENT, THE INSPECTOR STATES THAT "ELEC. CARTRIDGES ARE OUT OF LINE AND BASE HOLDING SAME IS BADLY BENT AND MANY PARTS ARE LYING ON FLOOR OF CRATE. MACHINE IS OUT OF LINE--- WILL HAVE TO BE RETURNED TO SHIPPER FOR REPAIRS.' IN HIS REPORT ON THE FIRST SHIPMENT, THE INSPECTOR MAKES SIMILAR OBSERVATIONS CONCERNING THE CONTAINERS AND STATES THAT "THE ELECTRIC CARTRIDGES IN THESE MACHINES HAVE BEEN DAMAGED AND ARE OUT OF LINE AND MACHINES SEEM TO BE OUT OF SQUARE. CONSIGNEE DOES NOT HAVE ANYONE HERE THAT CAN REPAIR AND WILL HAVE TO BE RETURNED TO SHIPPER FOR REPAIRS.'

THE DAMAGED RECORDERS WERE RETURNED TO THE SHIPPER, WHO DETERMINED THAT THEY WERE NOT REPARABLE BUT THAT THEY WERE SALVAGEABLE. REPLACEMENT RECORDERS WERE PROCURED BY GENERAL DYNAMICS AT A NET COST OF $54,404.48 TO THE GOVERNMENT. DEMAND BY NASA UPON YOUR COMPANY FOR PAYMENT OF THAT AMOUNT PROVED UNAVAILING AND THE CLAIM WAS REFERRED HERE FOR COLLECTION.

REPUBLIC IS A FREIGHT FORWARDER REGULATED UNDER PART IV OF THE INTERSTATE COMMERCE ACT, 49 U.S.C. 1001-1022; SECTION 413 OF THAT ACT, 49 U.S.C. 1013, MAKES SECTION 20 (11) OF PART I OF THE ACT APPLICABLE TO FREIGHT FORWARDERS. THE SUPREME COURT HAS STATED THAT SECTION 20 (11) OF THE INTERSTATE COMMERCE ACT CODIFIED THE COMMON LAW RULE MAKING A CARRIER LIABLE WITHOUT PROOF OF NEGLIGENCE FOR ALL DAMAGE TO THE GOODS TRANSPORTED BY IT UNLESS IT AFFIRMATIVELY SHOWS THAT THE DAMAGE WAS OCCASIONED BY THE SHIPPER, ACTS OF GOD, THE PUBLIC ENEMY, PUBLIC AUTHORITY, OR THE INHERENT VICE OR NATURE OF THE COMMODITY. SECRETARY OF AGRICULTURE V. UNITED STATES, 350 U.S. 162, 165-166, N. 9 (1956).

THE COURT ALSO HAS HELD THAT UNDER SECTION 20 (11), IN AN ACTION TO RECOVER FROM A CARRIER FOR DAMAGE TO A SHIPMENT, THE SHIPPER ESTABLISHES A PRIMA FACIE CASE WHEN HE SHOWS DELIVERY IN GOOD CONDITION, ARRIVAL IN DAMAGE CONDITION AND THE AMOUNT OF DAMAGES. THEREUPON, THE BURDEN OF PROOF IS UPON THE CARRIER TO SHOW BOTH THAT IT WAS FREE FROM NEGLIGENCE AND THAT THE DAMAGE TO THE CARGO WAS DUE TO ONE OF THE EXCEPTED CAUSES RELIEVING THE CARRIER OF LIABILITY. MISSOURI PACIFIC RAILROAD COMPANY V. ELMORE AND STAHL, 377 U.S. 134, 138 (1964).

WE BELIEVE THAT THE EVIDENCE IN THIS CASE ESTABLISHES FOR THE GOVERNMENT A PRIMA FACIE CASE OF REPUBLIC'S LIABILITY FOR THE DAMAGES TO THE TWO SHIPMENTS. THUS, REPUBLIC HAS THE BURDEN OF PROVING THAT THE SHIPMENT WAS NOT DELIVERED IN GOOD ORDER, THAT IT WAS DELIVERED BY IT IN GOOD CONDITION OR THAT THE EXCEPTED CAUSES ARE APPLICABLE, AND IT WAS FREE OF NEGLIGENCE. L.E. WHITLOCK TRUCK SERVICE, INC. V. REGAL DRILLING COMPANY, 333 F.2D 488 (1964). IN SUPER SERVICE MOTOR FREIGHT CO. V. UNITED STATES, 350 F.2D 541, 543 (1965), THE COURT SAID: * * * ONCE THE SHIPPER HAS PROVED A PRIMA FACIE CASE, THE BURDEN OF PROOF SHIFTS TO THE CARRIER AND REMAINS THERE. IN OUR VIEW, REPUBLIC HAS NOT MET THIS BURDEN.

THE EVIDENCE SENT IN BY YOU AND THE RECORD GENERALLY SHOWS THAT REPUBLIC DOES NOT DISPUTE THE FACT THAT THE GOVERNMENT HAS A PRIMA FACIE CASE OF CARRIER LIABILITY; RATHER, IT SHOWS THAT REPUBLIC BELIEVES THAT THE DAMAGES WERE CAUSED BY ONE OF THE EXCEPTED CAUSES, NAMELY, THE ACT OF THE SHIPPER IN IMPROPERLY PACKING THE RECORDERS FOR TRANSPORTATION.

YOU ORIGINALLY SET FORTH AND HAVE SINCE ABANDONED THE ARGUMENT THAT THE SHIPPER INCORRECTLY DESCRIBED THE SHIPMENTS ON THE BILL OF LADING AND THAT THE CORRECT DESCRIPTION WAS ONE WHICH WOULD RESTRICT THE CARRIER'S LIABILITY FOR THE VALUE OF THE COMMODITY TO AN AMOUNT NOT EXCEEDING $5 PER POUND. WE NOTE THAT THIS ARGUMENT IS NOT DESIGNED TO EXCEPT REPUBLIC FROM LIABILITY; IT MERELY WOULD LIMIT THAT LIABILITY.

IN SUPPORT OF THE ARGUMENT THAT THE SHIPPER IMPROPERLY PACKAGED THE GOODS FOR TRANSPORTATION, YOU FURNISHED EVIDENCE (INCLUDING THE PHOTOGRAPHS REFERRED TO EARLIER) OBTAINED FROM THE SANTA FE, THE UNDERLYING RAIL CARRIER THAT ACTUALLY PERFORMED THE MAJOR PART OF THE TRANSPORTATION; ITS MATERIALITY DEPENDS UPON AN UNDERSTANDING OF THE FUNCTIONAL RELATIONSHIP BETWEEN SURFACE FREIGHT FORWARDERS AND THEIR CUSTOMERS AND BETWEEN THOSE FORWARDERS AND THE CARRIERS WHO ACTUALLY PERFORM THE TRANSPORTATION SERVICE; IT ALSO DEPENDS UPON THE FACT THAT IN THIS PARTICULAR CASE SIMILAR TARIFF PACKING AND PACKAGING SPECIFICATIONS WERE IN EFFECT BETWEEN REPUBLIC AND THE SHIPPER AND BETWEEN REPUBLIC AND SANTA FE.

SURFACE FREIGHT FORWARDERS GENERALLY ARE CONSIDERED AS CARRIERS IN THEIR DEALINGS WITH THEIR CUSTOMERS AND AS SHIPPERS IN THEIR RELATIONSHIPS WITH UNDERLYING CARRIERS. CHICAGO, MILWAUKEE, ST. PAUL AND PACIFIC RAILROAD CO. V. ACME FAST FREIGHT, 336 U.S. 465 (1949). WHILE OUR CLAIM FOR DAMAGES IS AGAINST REPUBLIC, THE EVIDENCE SUBMITTED BY REPUBLIC CONCERNS REPUBLIC'S CLAIM FOR DAMAGES AGAINST SANTA FE.

THE DAMAGED ARTICLES WERE ELECTRONIC RECORDERS (OSCILLOGRAPHS) AND, AS BETWEEN REPUBLIC AND SANTA FE, ARE CLASSIFIED UNDER ITEM 34580 OF UNIFORM CLASSIFICATION 6, I.C.C. A-6. IN THAT CONNECTION, YOU FURNISHEDA LETTER DATED OCTOBER 6, 1966, TO REPUBLIC FROM SANTA FE, WHICH SAYS IN PART:

OUR INVESTIGATION HAS DISCLOSED THAT THESE EXPENSIVE ELECTRONIC INSTRUMENTS WERE SHIPPED IN INADEQUATE CONTAINERS, NOT MEETING UNIFORM FREIGHT CLASSIFICATION TARIFF REQUIREMENTS, HENCE NO RESPONSIBILITY RESTS WITH RAIL CARRIERS, AND YOUR CLAIM IS RESPECTFULLY DISALLOWED. YOU ALSO FURNISHED A COPY OF A LETTER DATED MAY 30, 1966, FROM THE UNIFORM CLASSIFICATION COMMITTEE TO SANTA FE, IN WHICH THE CHAIRMAN OF THE COMMITTEE CONCLUDES THAT THE OSCILLOGRAPHS WERE IMPROPERLY PACKED AND SHOULD HAVE BEEN SHIPPED IN BOXES MADE OF METAL OR WOOD, WHICH COMPLY WITH RULE 140, SECTION 120, UFC 6.

THE TARIFF APPLICABLE TO THE SERVICES FURNISHED BY REPUBLIC IS FREIGHT FORWARDERS TARIFF BUREAU WESTBOUND TARIFF NO. 2-A, I.C.C.-F.F. NO. 58. THAT TARIFF IS GOVERNED BY THE LCL RATINGS AND THE RULES IN CONSOLIDATED FREIGHT CLASSIFICATION NO. 22, I.C.C. OC-66; ITEM 34580 AND THE PERTINENT PACKING SPECIFICATIONS IN CFC 22 READ SUBSTANTIALLY THE SAME AS ITEM 34580 AND THE PERTINENT PACKING SPECIFICATIONS IN UFC 6. THUS, THE EVIDENCE SUBMITTED TO YOU BY SANTA FE COULD BE SAID TO ALSO SUPPORT THE CONCLUSION THAT THE SHIPMENTS WERE IMPROPERLY PACKED WHEN TENDERED TO REPUBLIC BY THE SHIPPER. HOWEVER, THIS CONCLUSION IS QUESTIONED BY THE LEWIS RESEARCH CENTER, NASA, THE AGENCY ADMINISTERING THE GENERAL DYNAMICS/ASTRONAUTICS CONTRACT. IN ITS REPORT TO US, NASA SAYS IN PART:

OUR REVIEW REVEALS THAT THE TIME THE DAMAGE WAS SURVEYED BY APPROPRIATE GOVERNMENT PERSONNEL, WE FOUND THAT THE SHIPMENT WAS PACKAGED PROPERLY IN ACCORDANCE WITH THE NATIONAL MOTOR FREIGHT CLASSIFICATION (NMFC) AND UNIFORM FREIGHT CLASSIFICATION (UFC/--- THIS BEING VERIFIED BY THE GOVERNMENT TRANSPORTATION OFFICER AT CONVAIR. FURTHERMORE, THE VENDOR (BRUSH INSTRUMENTS) HAS SHIPPED APPROXIMATELY 2,000 SIMILAR CONSOLES IN THE SAME OR SIMILAR TYPE PACKAGING. THE PACKAGING INVOLVED MEETS OR EXCEEDS THE REQUIREMENT OF THE UFC CODE. BRUSH INSTRUMENTS HAD INDICATED THAT THE CONSOLES HAVE BEEN DAMAGED IN THE PAST; HOWEVER, IN EACH INSTANCE, THE DAMAGE HAS BEEN ASSESSED TO THE CARIER DUE TO IMPROPER HANDLING AND NOT DUE TO IMPROPER PACKAGING. THIS RAISES A DISPUTE OVER A QUESTION OF FACT; IN SUCH CASES IT HAS LONG BEEN THE RULE OF THE ACCOUNTING OFFICES OF THE GOVERNMENT TO ACCEPT THE ADMINISTRATIVE REPORT AS CORRECT IN THE ABSENCE OF SUFFICIENTLY CONVINCING CONTRARY EVIDENCE. 41 COMP. GEN. 47, 54 (1961). ALTHOUGH THE EVIDENCE FURNISHED BY YOU CAST SOME DOUBT ON THE ADEQUACY OF THE PACKAGING METHODS USED BY THE SHIPPER, WE ARE NOT CONVINCED THAT IT IS ENOUGH TO SET ASIDE THE CONTRARY CONCLUSION IN THE ADMINISTRATIVE REPORT.

ASSUMING THAT THE RECORDERS WERE IMPROPERLY PACKED AND THAT THE IMPROPER PACKING WAS THE PROXIMATE CAUSE OF THE DAMAGE (AND NOTHING IN THE RECORD SO INDICATES), TO EXONERATE REPUBLIC FROM LIABILITY, THE EVIDENCE MUST SHOW THAT THE IMPROPER PACKING WAS THE SOLE CAUSE OF THE DAMAGE, THAT THE DEFECT WAS LATENT AND CONCEALED AND NOT DISCERNIBLE TO THE ORDINARY OBSERVATION OF AGENTS OF THE CARRIER, AND THAT REPUBLIC (OR ITS AGENTS) WAS FREE OF NEGLIGENCE IN HANDLING THE SHIPMENT. SEE THE SUPER SERVICE MOTOR FREIGHT AND L.E. WHITLOCK TRUCK SERVICE CASES CITED ABOVE. SEE, ALSO, WELLS LAUNDRY AND LINEN SUPPLY CO. V. ACME FAST FREIGHT, INC., 85 A.2D 907, 909 (1952): "TO ESCAPE LIABILITY, IT IS INCUMBENT UPON THE CARRIER * * * TO PROVE THAT THE SHIPMENT FALLS WITHIN ONE OF THE CATEGORIES REFERRED TO (THE EXCEPTIONS) AND THAT NO FAULT ON ITS PART CONTRIBUTED TO CAUSE THE DAMAGE; " AND NORTHWESTERN MARBLE AND TILE CO. V. WILLIAMS, 151 N.W. 419, 420 (1915): ,THE PROOF MUST BRING THE CASE - ENTIRELY AND PERFECTLY WITHIN THE EXCEPTION.-"

IN OUR VIEW, THE EVIDENCE OF RECORD DOES NOT SHOW THAT "NO FAULT ON ITS (REPUBLIC-S) PART CONTRIBUTED TO CAUSE THE DAMAGE; " IN FACT, THE INSPECTION REPORTS PREPARED BY GENERAL DYNAMIC'S TRAFFIC REPRESENTATIVE AND BY THE SANTA FE INSPECTOR RAISE AN INFLUENCE THAT THE SHIPMENTS WERE SUBJECTED TO ROUGH HANDLING WHILE IN THE HANDS OF THE CARRIERS. FURTHER, THE ASSUMPTION THAT THE GOODS WERE IMPROPERLY PACKED FOR SHIPMENT IS BASED PRIMARILY ON THE FACT THAT EACH RECORDER WEIGHED OVER 500 POUNDS AND THAT UNDER THE APPLICABLE FREIGHT CLASSIFICATION THEY SHOULD HAVE BEEN PACKED IN BOXES MADE OF METAL OR WOOD. IF TRUE, QUESTION ARISES WHETHER THE DEFECTIVE PACKAGING WAS IN FACT LATENT AND NOT DISCERNIBLE TO THE CARRIERS' AGENTS OR WHETHER THE CARRIERS' AGENTS SHOULD HAVE REFUSED THE SHIPMENTS. FOR THESE REASONS AND AS INDICATED ABOVE WE BELIEVE THAT REPUBLIC IS LIABLE FOR THE DAMAGE CLAIM OF $54,404.48 AND WE THEREFORE WILL RESUME OUR COLLECTION ACTION.