B-166899, NOVEMBER 25, 1969, 49 COMP. GEN. 352

B-166899: Nov 25, 1969

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SECTION 22 QUOTATIONS AUTHORITY A SHIPMENT OF MILITARY COMMUNICATION OUTFITS THAT MOVED UNDER A GOVERNMENT BILL OF LADING FROM CALIFORNIA TO NORTH CAROLINA AND WAS ACCORDED STORAGE-IN-TRANSIT PRIVILEGES AT AN INTERMEDIATE POINT PROPERLY WAS BILLED AND PAYMENT MADE ON THE BASIS OF A THROUGH RATE. THE CONCEPT OF TRANSIT PRIVILEGES RESTS ON THE FICTION THAT TWO OR MORE SEPARATE SHIPMENTS ARE A SINGLE SHIPMENT ON WHICH THE CHARGES ASSESSED ARE LOWER THAN THE AGGREGATE OF THE CHARGES ON THE SEPARATE SHIPMENTS. ALTHOUGH THE CONCEPT IS ONLY APPLICABLE TO PRIVATE SHIPPERS WHEN PROVIDED BY TARIFF. THE LOWER THROUGH RATE IS ACCORDED THE GOVERNMENT ON ITS VOLUME STORAGE-IN TRANSIT SHIPMENTS ON PRACTICALLY ALL COMMODITIES BY SFA SECTION 22 QUOTATION ADVICE A-610-F.

B-166899, NOVEMBER 25, 1969, 49 COMP. GEN. 352

TRANSPORTATION -- TRANSIT PRIVILEGES -- THROUGH RATES -- SECTION 22 QUOTATIONS AUTHORITY A SHIPMENT OF MILITARY COMMUNICATION OUTFITS THAT MOVED UNDER A GOVERNMENT BILL OF LADING FROM CALIFORNIA TO NORTH CAROLINA AND WAS ACCORDED STORAGE-IN-TRANSIT PRIVILEGES AT AN INTERMEDIATE POINT PROPERLY WAS BILLED AND PAYMENT MADE ON THE BASIS OF A THROUGH RATE, NOTWITHSTANDING THE ABSENCE OF A THROUGH RATE IN THE APPLICABLE TRANSCONTINENTAL TARIFF. THE CONCEPT OF TRANSIT PRIVILEGES RESTS ON THE FICTION THAT TWO OR MORE SEPARATE SHIPMENTS ARE A SINGLE SHIPMENT ON WHICH THE CHARGES ASSESSED ARE LOWER THAN THE AGGREGATE OF THE CHARGES ON THE SEPARATE SHIPMENTS, AND ALTHOUGH THE CONCEPT IS ONLY APPLICABLE TO PRIVATE SHIPPERS WHEN PROVIDED BY TARIFF, THE LOWER THROUGH RATE IS ACCORDED THE GOVERNMENT ON ITS VOLUME STORAGE-IN TRANSIT SHIPMENTS ON PRACTICALLY ALL COMMODITIES BY SFA SECTION 22 QUOTATION ADVICE A-610-F, AS WELL AS OTHERS.

TO THE SEABOARD COAST LINE RAILROAD COMPANY, NOVEMBER 25, 1969:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF MAY 6, 1969, ASKING FOR REVIEW OF THE SETTLEMENT OF YOUR SUPPLEMENTAL BILL 281509-P, OUR CLAIM TK- 885680. THE SHIPMENT IN QUESTION CONSISTED OF A MILITARY COMMUNICATION OUTFIT MOVED UNDER GOVERNMENT BILL OF LADING AT-056387, FROM AVON, KENTUCKY, TO FORT BRAGG, NORTH CAROLINA, WITH PRIOR ORIGIN AT POLK, CALIFORNIA, AND STORAGE IN TRANSIT AT AVON.

FOR THIS SERVICE, YOU BILLED ORIGINALLY ON THE BASIS OF A TRANSIT BALANCE BASED ON THE THROUGH RATE PROVIDED IN TRANS-CONTINENTAL FREIGHT TARIFF 1015-A, APPLICABLE FROM POLK TO FORT BRAGG, LESS A RATE SHOWN AS HAVING BEEN PAID FOR THE INBOUND MOVEMENT TO AVON, PLUS A TRANSIT CHARGE AS PROVIDED IN SFA SECTION 22 QUOTATION ADVICE A-610-F. THEREAFTER, YOU SUBMITTED YOUR SUPPLEMENTAL BILL FOR AN ADDITIONAL SUM OF $320.15, BASED ON LOCAL RATES APPLICABLE TO AND FROM AVON, ON THE GROUND THAT THE THROUGH RATE FROM POLK TO FORT BRAGG WAS INAPPLICABLE BECAUSE THERE WAS NO AUTHORIZATION IN THE TRANSCONTINENTAL RATE TARIFF FOR APPLICATION OF THE THROUGH RATE TO A SHIPMENT STORED IN TRANSIT AT AN INTERMEDIATE POINT. SETTLEMENT CERTIFICATE DATED MARCH 19, 1969, YOUR CLAIM WAS DISALLOWED, AND YOU HAVE ASKED FOR REVIEW OF THAT SETTLEMENT.

IN YOUR REQUEST FOR REVIEW, YOU STATE, IN EFFECT, THAT THE ALL-RAIL CARLOAD RATE AUTHORIZED BY THE TRANSIT QUOTATION MUST BE ONE THAT IS APPLICABLE FROM POINT OF ORIGIN TO DESTINATION IN EFFECT BY TARIFF OR AS PROVIDED IN ANY APPLICABLE QUOTATION. YOU FURTHER STATE THAT THERE WAS NO APPLICABLE QUOTATION RATE IN EFFECT AND THAT THE THROUGH TARIFF RATE IN TRANS-CONTINENTAL FREIGHT TARIFF 1015-A WAS INAPPLICABLE BECAUSE THE PROVISIONS IN ITEM 25 OF THAT TARIFF WOULD NOT PERMIT THE RATE TO APPLY ON A SHIPMENT STORED IN TRANSIT AT A POINT INTERMEDIATE BETWEEN ORIGIN AND DESTINATION.

ADDITIONALLY, YOU SAY THAT THE TRANSIT QUOTATION "DOES NOT AT ANY PLACE STATE THAT CONTRARY TO THE TARIFF APPLICATION THAT TRANSIT DOES NOT APPLY, TRANSIT HEREUNDER WILL BE AUTHORIZED." ALSO, YOU REFER TO SFA SECTION 22 QUOTATION ADVICE A-529-B AS ILLUSTRATIVE OF A QUOTATION WHICH EXPRESSLY WAIVES RATE TARIFF PROHIBITIONS AGAINST TRANSIT AND YOU POINT OUT THAT A PROVISION OF THIS KIND IS NOT CARRIED IN SFA SECTION 22 QUOTATION ADVICE A -610-F.

THE ENTIRE CONCEPT OF STOPPING IN TRANSIT AND THE GRANTING OF TRANSIT PRIVILEGES RESTS ON THE FICTION THAT TWO OR MORE SEPARATE SHIPMENTS MAY BE REGARDED AS A SINGLE THROUGH SHIPMENT AND THROUGH CHARGES ASSESSED WHICH ARE LOWER THAN THE AGGREGATE OF THE CHARGES OTHERWISE APPLICABLE TO THE SEPARATE SHIPMENTS. INTERSTATE COMMERCE COMMISSION RULES GOVERNING THE CONSTRUCTION AND FILING OF FREIGHT-RATE PUBLICATIONS PROVIDE THAT EACH CARRIER OR ITS AGENT SHALL PUBLISH, POST, AND FILE TARIFFS WHICH SHALL CONTAIN IN CLEAR, PLAIN, AND SPECIFIC FORM AND TERMS, ALL THE RULES GOVERNING AND RATES AND CHARGES FOR TERMINAL AND TRANSIT SERVICES. TARIFF CIRCULAR NO. 20, RULE 10. THUS, THE THROUGH RATES FOUND IN ANY LINE-HAUL RATE TARIFF WILL NOT APPLY ON SHIPMENTS STORED IN TRANSIT AT INTERMEDIATE POINTS UNLESS THE TARIFF CONTAINING SUCH RATES AUTHORIZES THE APPLICATION OF THE RATES NAMED THEREIN IN CONNECTION WITH A TRANSIT SERVICE AT SUCH INTERMEDIATE POINTS. GOVERNMENT TRAFFIC PATTERNS ARE NOT CREATED AND CONTROLLED BY THE ECONOMIC CONSIDERATIONS WHICH GOVERN THE OPERATIONS OF PRIVATE SHIPPERS. CONSEQUENTLY, GOVERNMENT STORAGE AND REFORWARDING INSTALLATIONS OFTEN ARE LOCATED AT POINTS WHERE STORAGE-IN-TRANSIT PRIVILEGES ARE NOT ACCORDED THE GENERAL PUBLIC. IN ADDITION, GOVERNMENT TRAFFIC OFTEN CONSISTS OF COMMODITIES SUCH AS AMMUNITION, GUNS, COMBAT VEHICLES, ETC., WHICH ORDINARILY DO NOT MOVE IN COMMERCIAL CHANNELS AND FOR WHICH COMMERCIAL STORAGE-IN-TRANSIT PRIVILEGES ARE NOT PROVIDED BY TARIFF. IN CONSEQUENCE, IF THE RATES ASSESSED ON MOST GOVERNMENT SHIPMENTS ACCORDED STORAGE IN TRANSIT WERE ONLY THOSE AVAILABLE BY TARIFF, THE RATES IN MOST CASES WOULD BE THOSE APPLICABLE TO AND FROM THE TRANSIT POINTS BECAUSE THE TARIFFS CONTAINING THE THROUGH RATES ORDINARILY WOULD NOT AUTHORIZE THE APPLICATION OF SUCH THROUGH RATES ON SUCH TRAFFIC.

TO AVOID THIS CONSEQUENCE, MOST GOVERNMENT STORAGE AND REFORWARDING PROGRAMS ARE ACCORDED STORAGE-IN-TRANSIT PRIVILEGES UNDER SECTION 22 QUOTATIONS. THESE QUOTATIONS, IN EFFECT, PROVIDE REDUCTIONS FROM THE COMBINATIONS OF RATES WHICH WOULD OTHERWISE APPLY TO THE THROUGH RATES AUTHORIZED BY THE QUOTATIONS, PLUS AN APPROPRIATE CHARGE FOR THE TRANSIT SERVICE. THE BASIC PURPOSE OF THESE TRANSIT QUOTATIONS IS TO AFFORD THE GOVERNMENT TRANSIT PRIVILEGES WHICH ARE NOT AUTHORIZED IN THE RATE TARIFFS CONTAINING THE LINE-HAUL RATES APPLICABLE FROM THE INITIAL ORIGINS TO THE ULTIMATE DESTINATIONS OF THE TRANSITED SHIPMENTS.

SFA SECTION 22 QUOTATION ADVICE NO. A-610-F IS OFFERED FOR AND ON BEHALF OF ALL CARRIERS BY RAILROAD PARTIES TO THE UNIFORM FREIGHT CLASSIFICATION AND AUTHORIZES TRANSIT PRIVILEGES AT SOME 91 GOVERNMENT TRANSIT INSTALLATIONS LOCATED THROUGHOUT THE UNITED STATES. WITH MINOR EXCEPTIONS RELATING TO COMMODITIES FOR WHICH TRANSIT PRIVILEGES ARE PROVIDED IN OTHER SECTION 22 QUOTATIONS, THE TRANSIT PRIVILEGES OFFERED ARE APPLICABLE TO PRACTICALLY ALL COMMODITIES. THE QUOTATION (INCLUDING THE APPENDIX), AS ORIGINALLY ISSUED, CONSISTS OF SOME 62 PAGES, OF WHICH SOME 28 PAGES RELATE EXCLUSIVELY TO BACK-HAUL OR OUT-OF ROUTE-HAUL PROVISIONS. IN VIEW OF THE SCOPE AND COMPLEXITY OF THE QUOTATION AS A WHOLE, IT SEEMS UNLIKELY THAT IT WAS INTENDED TO OFFER THROUGH RATES ON TRANSITED COMMODITIES IN ONLY THOSE INSTANCES IN WHICH STORAGE IN TRANSIT WAS AUTHORIZED BY TARIFF IN CONNECTION WITH THE TARIFF RATES. IF TRANSIT PRIVILEGES WERE AUTHORIZED BY TARIFF, THERE WOULD BE NO NEED FOR THE QUOTATION.

ITEM NO. 6 OF THE QUOTATION SPECIFIES THE RATES AND CHARGES TO BE APPLIED TO SHIPMENTS ACCORDED STORAGE IN TRANSIT UNDER THE QUOTATION. THE FIRST PART OF THE ITEM SPECIFIES THE INBOUND RATES TO BE APPLIED ON INBOUND SHIPMENTS TO THE TRANSIT POINTS. THE SECOND PART OF THE ITEM IDENTIFIES THE THROUGH RATES TO BE APPLIED ON SHIPMENTS RESHIPPED FROM THE TRANSIT POINTS. FOR THROUGH RATES, THE ITEM PROVIDES, IN PERTINENT PART, AS TO COMMODITIES RESHIPPED FROM A TRANSIT POINT WITHIN 12 MONTHS FROM THE DATE OF THE INBOUND FREIGHT BILL:

EACH SHIPMENT MADE FROM ITS INITIAL POINT OR PORT OF ORIGIN AND AFTER THE EFFECTIVE DATE HEREOF SHALL BE SUBJECT AND ENTITLED TO THE ALL-RAIL CARLOAD RATE APPLICABLE TO THE INBOUND OR OUTBOUND COMMODITY WHICHEVER IS HIGHER, FROM SUCH POINT OR PORT OF ORIGIN TO THE PORT, DESTINATION OR RAILHEAD, IN EFFECT BY TARIFF OR AS PROVIDED IN ANY APPLICABLE QUOTATION ON THE DATE OF SUCH SHIPMENT FROM INITIAL POINT OR PORT OR ORIGIN.

WHILE, AS YOU POINT OUT, THE THROUGH RATE SO AUTHORIZED IS NOT EXPRESSLY IDENTIFIED AS ONE "IN EFFECT BY TARIFF" WITHOUT REGARD TO TARIFF RESTRICTIONS AGAINST STORAGE AT INTERMEDIATE POINTS, NEITHER IS IT EXPRESSLY IDENTIFIED AS ONE SUBJECT TO SUCH RESTRICTIONS. IN OUR VIEW, THE THROUGH RATE INTENDED TO BE OFFERED BY THE QUOTATION IS ONE "IN EFFECT BY TARIFF" THAT WOULD BE APPLICABLE ON A THROUGH SHIPMENT FROM INITIAL THE RATE NEED NOT NECESSARILY APPLY VIA A DIRECT ROUTE THROUGH THE TRANSIT ORIGIN TO ULTIMATE DESTINATION IF THERE HAD BEEN NO STOP IN TRANSIT. POINT BUT CAN ALSO APPLY VIA INDIRECT ROUTES BY MEANS OF OUT-OF-LINE-HAUL AND BACK-HAUL PROVISIONS CONTAINED IN THE QUOTATION.

IN VIEW OF THESE PROVISIONS, THE ONLY RULES, REGULATIONS AND RESTRICTIONS CONTAINED IN THE PERTINENT RATE TARIFFS TO BE OBSERVED IN DETERMINING THE RATE TO BE USED UNDER THE QUOTATION ARE THOSE AFFECTING THE APPLICATION OF THE RATE AS A THROUGH RATE ON A SHIPMENT WHICH HAS NOT BEEN STOPPED IN TRANSIT. ANY RESTRICTION IN THE RATE TARIFF AFFECTING THE APPLICATION OF THE RATE BECAUSE OF AN UNAUTHORIZED STOP IN TRANSIT OBVIOUSLY IS WAIVED BY THE QUOTATION; IF THIS WERE NOT TRUE, THE TRANSIT PRIVILEGE INTENDED UNDER THE QUOTATION WOULD SELDOM, IF EVER, APPLY TO SHIPMENTS MOVING TO AND FROM GOVERNMENT TRANSIT INSTALLATIONS. IN OUR VIEW, THE EXPRESS PROVISIONS OF SFA SECTION 22 QUOTATION ADVICE A-529-B, TO WHICH YOU REFER, ARE MERELY DECLARATORY OF THE SAME INTENTION WHICH MUST BE ACCORDED THE SUBJECT QUOTATION BY NECESSARY IMPLICATION.

FOR THE REASONS STATED, SETTLEMENT OF YOUR SUPPLEMENTAL BILL ON THE BASIS OF THE THROUGH RATE APPLICABLE FROM POLK TO FORT BRAGG IS SUSTAINED. IS NOTED, HOWEVER, THAT THE INBOUND CHARGES CREDITED IN YOUR ORIGINAL BILL, AND ALSO APPLIED AS A CREDIT IN THE SETTLEMENT ISSUED HERE, EXCEEDED THE AMOUNT OF THE INBOUND CHARGES ACTUALLY PAID BY THE SUM OF $292.60. REVISED SETTLEMENT WILL BE ISSUED FOR THIS AMOUNT AND PAYMENT SHOULD REACH YOU IN DUE COURSE.