B-169537, SEP 3, 1970, 50 COMP GEN 164

B-169537: Sep 3, 1970

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WHICH WAS REFUSED AT DESTINATION WHEN IT WAS DISCOVERED THE SHIPMENT CONTAINED MEAT AS THE VESSEL HAD MADE SEVERAL STOPS AT PORTS CONSIDERED TO BE INFECTED AREAS FOR MEAT PRODUCTS. EVEN THOUGH PART OF THE SHIPMENT WAS RETURNED TO THE ORIGIN POINT IN THE UNITED STATES. THE MEAT HAVING BEEN JETTISONED AT SEA BECAUSE ITS RETURN WAS PROHIBITED UNDER A DEPARTMENT OF AGRICULTURE REGULATION. AS THE CONSIGNEE'S CERTIFICATE OF DELIVERY ON THE GOVERNMENT BILL OF LADING WAS NOT AND COULD NOT HAVE BEEN ACCOMPLISHED WITHOUT DELIVERY OF THE SHIPMENT - A CONDITION PRECEDENT TO LIABILITY FOR FREIGHT CHARGES. 1970: REFERENCE IS MADE TO YOUR LETTERS OF JANUARY 27 AND AUGUST 7. WHICH WILL BE CONSIDERED AS A REQUEST FOR REVIEW OF THE ACTION TAKEN BY OUR TRANSPORTATION DIVISION IN DISALLOWING A CLAIM (BILL NO. 4754.

B-169537, SEP 3, 1970, 50 COMP GEN 164

PROPERTY - PUBLIC - DAMAGE, LOSS, ETC. - FREIGHT CHARGES - DELIVERY ACCOMPLISHMENT THE FREIGHT CHARGES CLAIMED ON AN OVERSEAS SHIPMENT THAT MOVED UNDER A GOVERNMENT BILL OF LADING IDENTIFYING THE SHIPMENT AS FROZEN FOODS, AND WHICH WAS REFUSED AT DESTINATION WHEN IT WAS DISCOVERED THE SHIPMENT CONTAINED MEAT AS THE VESSEL HAD MADE SEVERAL STOPS AT PORTS CONSIDERED TO BE INFECTED AREAS FOR MEAT PRODUCTS, MAY NOT BE ALLOWED, EVEN THOUGH PART OF THE SHIPMENT WAS RETURNED TO THE ORIGIN POINT IN THE UNITED STATES, THE MEAT HAVING BEEN JETTISONED AT SEA BECAUSE ITS RETURN WAS PROHIBITED UNDER A DEPARTMENT OF AGRICULTURE REGULATION, AS THE CONSIGNEE'S CERTIFICATE OF DELIVERY ON THE GOVERNMENT BILL OF LADING WAS NOT AND COULD NOT HAVE BEEN ACCOMPLISHED WITHOUT DELIVERY OF THE SHIPMENT - A CONDITION PRECEDENT TO LIABILITY FOR FREIGHT CHARGES.

TO THE OCEANIC STEAMSHIP COMPANY, SEPTEMBER 3, 1970:

REFERENCE IS MADE TO YOUR LETTERS OF JANUARY 27 AND AUGUST 7, 1970, WHICH WILL BE CONSIDERED AS A REQUEST FOR REVIEW OF THE ACTION TAKEN BY OUR TRANSPORTATION DIVISION IN DISALLOWING A CLAIM (BILL NO. 4754, OUR TK- 877331) BY THE OCEANIC STEAMSHIP COMPANY, A SUBSIDIARY OF MATSON NAVIGATION COMPANY (HEREAFTER REFERRED TO AS MATSON), FOR $616.27 AS FREIGHT CHARGES ON A SHIPMENT OF FROZEN FOODS FROM PIER 35, SAN FRANCISCO, CALIFORNIA, DESTINED FOR DELIVERY TO THE USNS ELTANIN AT AUCKLAND, NEW ZEALAND, UNDER GOVERNMENT BILL OF LADING NO. E-7135585 DATED JANUARY 21, 1968.

GOVERNMENT BILL OF LADING E-7,135,585 WAS EXECUTED JANUARY 21, 1968, BY OCEANIC STEAMSHIP COMPANY (MATSON NAVIGATION COMPANY, AGENTS) AND SIGNED BY R. MONTE, ACKNOWLEDGING RECEIPT OF "247 PCS. FREEZE FOODS" AS SHOWN ON THE SHEETS ATTACHED TO THE BILL OF LADING FOR DELIVERY TO AUCKLAND, NEW ZEALAND. THE ATTACHED SHEETS SHOW THAT THE SHIPMENT CONSISTED OF FROZEN MEAT, VEGETABLES, SHRIMP, FISH, AND POULTRY. THE VESSEL USED TO TRANSPORT THE CARGO, THE SS MARIPOSA, VOYAGE 89, MADE AT LEAST THREE STOPS AT FOREIGN PORTS PRIOR TO ITS ARRIVAL AT AUCKLAND; NAMELY, BORA BORA AND PAPEETE (TAHITI), SOCIETY ISLANDS AND RAROTONGA, COOK ISLANDS. ALL THREE OF THE NAMED PORTS WERE CONSIDERED INFECTED AREAS FOR MEAT PRODUCTS BY BOTH THE UNITED STATES AND NEW ZEALAND GOVERNMENTS. EACH OF THE THREE PORTS HAD BEEN CONSIDERED CONTAMINATED FOR MORE THAN A YEAR PRIOR TO THE TRANSPORTATION INVOLVED. DELIVERY WAS NOT PERFORMED BECAUSE THE NEW ZEALAND GOVERNMENT PROHIBITED UNLOADING OF THE CARGO. LATER THE PORTION OF THE SHIPMENT OTHER THAN THE MEATS WAS RETURNED TO THE DEFENSE SUPPLY AGENCY, OAKLAND, CALIFORNIA. THE REMAINDER (THE MEAT PORTION OF THE SHIPMENT) WAS JETTISONED AT SEA ON MARCH 19, 1968, AFTER THE U.S. DEPARTMENT OF AGRICULTURE, PURSUANT TO THE PROVISIONS OF PART 94 TITLE 9 OF THE CODE OF FEDERAL REGULATIONS, PROHIBITED THE RETURN OF THE MEAT PORTION OF THE SHIPMENT TO THE UNITED STATES.

THE MILITARY SEA TRANSPORTATION SERVICE FORWARDED YOUR BILL FOR TRANSPORTATION CHARGES OF $616.27 TO THIS OFFICE FOR DIRECT SETTLEMENT SINCE THE CONSIGNEE'S CERTIFICATE OF DELIVERY WAS NOT ACCOMPLISHED. YOUR CLAIM FOR SUCH CHARGES WAS DISALLOWED BY OUR TRANSPORTATION DIVISION BY SETTLEMENT CERTIFICATE DATED SEPTEMBER 24, 1968, AND SUCH SETTLEMENT WAS REAFFIRMED BY ITS LETTER DATED JANUARY 8, 1970. THE ACTION TAKEN BY OUR TRANSPORTATION DIVISION IN DISALLOWING THE CLAIM WAS BASED UPON THE DECISION OF THE UNITED STATES SUPREME COURT WHICH HELD THAT THE GOVERNMENT BILL OF LADING'S SPECIFIC CONDITIONS FOR PAYMENT OF FREIGHT CHARGES CAN ONLY BE SATISFIED BY DELIVERY OF THE SHIPMENT TO DESTINATION CITING ALCOA STEAMSHIP CO., INC. V UNITED STATES, 338 U.S. 421 (1949), AND STRICKLAND TRANSPORTATION CO. V UNITED STATES, 223 F. 2D 466 (5TH CIR. 1955).

IN REQUESTING REVIEW OF THE MATTER, YOU ASSERT THAT YOU HAD NO KNOWLEDGE THE SHIPMENT CONTAINED MEAT PRODUCTS SINCE THE SHIPMENT WAS TENDERED AS FROZEN FOODS, AND THAT IT WAS ONLY WHEN DISCHARGE WAS ATTEMPTED AT AUCKLAND THAT IT WAS DISCOVERED THAT THE SHIPMENT CONSISTED CHIEFLY OF MEAT. YOU EXPRESS THE OPINION THAT THE REAL REASON THE SHIPMENT WAS NOT ALLOWED INTO NEW ZEALAND WAS THE LACK OF AN ENTRY PERMIT FROM THE NEW ZEALAND GOVERNMENT, AND THAT IT WAS THE DUTY OF THE SHIPPER TO OBTAIN SUCH ENTRY PERMIT. WITH YOUR LETTER OF AUGUST 7, 1970, YOU ENCLOSE A COPY OF THE APPLICABLE REGULATIONS FOR THE PREVENTION OF THE INTRODUCTION INTO NEW ZEALAND OF DISEASES AFFECTING STOCK MADE UNDER THAT COUNTRY'S STOCK ACT OF 1908, WHICH MAY BE CITED AS THE STOCK IMPORTATION AMENDING REGULATIONS 1966, AS WELL AS A COPY OF A LETTER DATED FEBRUARY 26, 1968, FROM THE DIRECTOR OF ANIMAL HEALTH, N.Z. DEPARTMENT OF AGRICULTURE, WELLINGTON, NEW ZEALAND.

THE CITED REGULATIONS MAKE CERTAIN EXCEPTIONS TO AUTHORIZE THE IMPORTATION OF COOKED MEAT AND MEAT IN SEALED CONTAINERS PROVIDED A PRIOR PERMIT IS OBTAINED BUT SPECIFICALLY PROHIBIT THE IMPORTATION OF RAW MEAT OR COOKED MEAT WHICH MAY HAVE BEEN EXPOSED TO INFECTION. FROM THE RECORD AVAILABLE IT MUST BE CONCLUDED THAT THE STOPPING AT THE CONTAMINATED PORTS WOULD HAVE FRUSTRATED DELIVERY AT NEW ZEALAND EVEN IF A PRIOR ENTRY PERMIT HAD BEEN OBTAINED.

THERE IS NO QUESTION THAT THE "CONSIGNEE'S CERTIFICATE OF DELIVERY" ON GOVERNMENT BILL OF LADING NO. E-7,135,585 WAS NOT AND, UNDER THE CIRCUMSTANCES, COULD NOT HAVE BEEN ACCOMPLISHED. IT NOW APPEARS CLEAR THAT THE "GOODS OR VESSEL LOST OR NOT LOST" PROVISION IN THE STANDARD OCEAN CARRIER'S COMMERCIAL BILL OF LADING WOULD HAVE ENTITLED MATSON TO PAYMENT OF THE FREIGHT CHARGES INVOLVED HAD THE SHIPMENT BEEN A COMMERCIAL ONE. HOWEVER, THE SUPREME COURT EMPHASIZED THE FACT IN THE ALCOA CASE, 338 U.S. 421, AT PAGE 427 THAT, UNDER THE TERMS OF THE GOVERNMENT BILL OF LADING,

*** WITHOUT RECEIPT OF THE GOODS, THE BILL WAS NOT, AND COULD NOT HAVE BEEN, FILLED IN UNDER THE STRICT TERMS OF THE STANDARD FORM WHICH WE HAVE STRESSED, SO AS TO BE "PROPERLY ACCOMPLISHED" FOR PURPOSES OF PAYMENT TO THE CARRIER.

ALSO, IN THE STRICKLAND CASE CITED ABOVE, AT PAGE 468, CONCERNING SHIPMENTS UNDER GOVERNMENT BILLS OF LADING, THE COURT OF APPEALS, FIFTH CIRCUIT, STATED:

THE BILL OF LADING CANNOT BE "PROPERLY ACCOMPLISHED" UNTIL THERE HAS BEEN A RECEIPT OF THE SHIPMENT BY THE CONSIGNEE AT DESTINATION. DELIVERY OF THE SHIPMENT IS A CONDITION PRECEDENT TO LIABILITY FOR FREIGHT.

CONSEQUENTLY, THERE APPEARS TO BE NO PROPER LEGAL BASIS FOR THE PAYMENT OF THE FREIGHT CHARGES INVOLVED. ACCORDINGLY, THE DISALLOWANCE OF YOUR CLAIM MUST BE, AND IS, SUSTAINED.