B-173822, APR 25, 1972

B-173822: Apr 25, 1972

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CLAIMANT CONTENDS THAT ONCE THE TRANSIT BILLING IS TENDERED. THE PRIOR SETTLEMENT MADE ON THE BASIS OF THE LOWEST CHARGES AVAILABLE TO THE GOVERNMENT WAS CLEARLY AUTHORIZED AND MUST BE SUSTAINED. TO ILLINOIS CENTRAL RAILROAD COMPANY: FURTHER REFERENCE IS MADE TO YOUR REQUEST. THE CLAIM IS FOR TRANSPORTATION SERVICES FURNISHED UNDER GOVERNMENT TRANSIT BILL OF LADING NO. THIS IS A SECTION 22 QUOTATION ISSUED BY EXECUTIVE COMMITTEE-WESTERN RAILROAD TRAFFIC ASSOCIATION UNDER SECTION 22 OF THE INTERSTATE COMMERCE ACT. THE BILL OF LADING ALSO SHOWS THAT THE TONNAGE LISTED THEREON WAS RECORDED FOR TRANSIT AT AVONDALE. CHARGES FOR THE SERVICES FURNISHED WERE ASSESSED ON THE BASIS OF A THROUGH TARIFF RATE APPLICABLE ON AMMUNITION FROM VALLEJO TO DOYLINE.

B-173822, APR 25, 1972

TRANSPORTATION - GOVERNMENT TRANSIT BILL OF LADING - APPROPRIATE TARIFF RATE DECISION AFFIRMING PRIOR SETTLEMENT OF A CLAIM OF THE ILLINOIS CENTRAL RAILROAD COMPANY FOR TRANSPORTATION SERVICES ON A THROUGH TARIFF RATE BASIS. THE GRANTING OF TRANSIT PRIVILEGES RESTS ON THE FICTION THAT TWO OR MORE SEPARATE SHIPMENTS MAY BE TREATED AS A SINGLE THROUGH SHIPMENT FOR WHICH CHARGES LESS THAN THOSE APPLICABLE TO SEPARATE SHIPMENTS MAY BE ASSESSED. CLAIMANT CONTENDS THAT ONCE THE TRANSIT BILLING IS TENDERED, THERE EXISTS NO AUTHORITY TO USE A COMBINATION OF RATES TO DEFEAT THE THROUGH RATE. HOWEVER, THE TRANSIT QUOTATION ITSELF SEEMS TO RECOGNIZE THE RIGHT RESERVED TO THE SHIPPER TO ELECT TO DISREGARD THE TRANSIT FICTION AND TO SETTLE THE CHARGES ON THE BASIS OF THE RATES APPLICABLE ON THE SEPARATE SHIPMENTS. ACCORDINGLY, THE PRIOR SETTLEMENT MADE ON THE BASIS OF THE LOWEST CHARGES AVAILABLE TO THE GOVERNMENT WAS CLEARLY AUTHORIZED AND MUST BE SUSTAINED.

TO ILLINOIS CENTRAL RAILROAD COMPANY:

FURTHER REFERENCE IS MADE TO YOUR REQUEST, PER FILE 5-G-MRA 87888-DD, FOR REVIEW OF THE SETTLEMENT (TK-917892) DISALLOWING YOUR CLAIM ON BILL NUMBER MRA-87888-A IN THE AMOUNT OF $1,535.60. THE CLAIM IS FOR TRANSPORTATION SERVICES FURNISHED UNDER GOVERNMENT TRANSIT BILL OF LADING NO. AT-063800, WHICH COVERS A SHIPMENT OF AMMUNITION MOVING OUTBOUND FROM AVONDALE, COLORADO, TO DOYLINE, LOUISIANA. THE TRANSIT RESHIPPING CERTIFICATE BEARS REFERENCE TO 85,820 POUNDS OF INBOUND TRANSIT CREDITS AT AVONDALE, REPRESENTING SHIPMENTS ORIGINATING AT VALLEJO, CALIFORNIA.

BILL OF LADING AT-063800 BEARS REFERENCE, IN THE SPACE PROVIDED FOR TARIFF OR SPECIAL RATE AUTHORITIES, TO THE TERM "ECWTA-82-C." THIS IS A SECTION 22 QUOTATION ISSUED BY EXECUTIVE COMMITTEE-WESTERN RAILROAD TRAFFIC ASSOCIATION UNDER SECTION 22 OF THE INTERSTATE COMMERCE ACT, 49 U.S.C. 22. IT APPLIES TO TRANSIT ARRANGEMENTS ON DOMESTIC AND EXPORT SHIPMENTS OF AMMUNITION, EXPLOSIVES AND OTHER ORDNANCE. THE BILL OF LADING ALSO SHOWS THAT THE TONNAGE LISTED THEREON WAS RECORDED FOR TRANSIT AT AVONDALE.

CHARGES FOR THE SERVICES FURNISHED WERE ASSESSED ON THE BASIS OF A THROUGH TARIFF RATE APPLICABLE ON AMMUNITION FROM VALLEJO TO DOYLINE, PLUS A TRANSIT CHARGE, LESS THE INBOUND CHARGES PAID TO AVONDALE. IN OUR AUDIT THE CHARGES WERE COMPUTED ON THE BASIS OF A COMBINATION OF LOCAL RATES MADE OVER AVONDALE. THE CHARGES TO AVONDALE WERE BASED ON A CLASS 40 RATE OF $2.92 PER ONE HUNDRED POUNDS, SUBJECT TO A MINIMUM WEIGHT OF 36,000 POUNDS FOR EACH OF THE TWO CARS IDENTIFIED ON THE BILL OF LADING, IN ACCORDANCE WITH ITEM 69093 OF UNIFORM FREIGHT CLASSIFICATION NO. 8, I.C.C. NO. 4, AND THE RATE PUBLISHED IN TRANS CONTINENTAL FREIGHT BUREAU TARIFF NO. 1015-A, I.C.C. NO. 1688.

BEYOND AVONDALE CHARGES WERE COMPUTED ON THE BASIS OF A CLASS 45 RATE OF $2.07 PER 100 POUNDS FOR THE FIRST 40,000 POUNDS AND 80 PERCENT OF CLASS 45, OR $1.66 PER 100 POUNDS, ON THE WEIGHT IN EXCESS OF 40,000 POUNDS. THIS BASIS IS AUTHORIZED IN SOUTHWESTERN LINES FREIGHT TARIFF SW/W-1006-A, I.C.C. 4629, PURSUANT TO THE PROVISIONS OF SOUTHWESTERN LINES FREIGHT BUREAU RATE QUOTATION NO. 978, APPENDIX B.

YOU DISPUTED OUR TRANSPORTATION DIVISION'S NOTICE OF OVERCHARGE (FORM 1003) REQUESTING REFUND OF $1,535.60, AND THAT AMOUNT SUBSEQUENTLY WAS RECOVERED BY SETOFF FROM AN OPEN ACCOUNT. YOUR CLAIM FOR REFUND OF THE AMOUNT WAS DISALLOWED IN OUR CERTIFICATE OF SETTLEMENT DATED MARCH 5, 1971.

IN YOUR REQUEST FOR REVIEW AND RECLAIM OF THE AMOUNT OF $1,535.60 YOU MAKE NO FURTHER EXPLANATION IN SUPPORT OF YOUR POSITION THAT THE TRANSIT BASIS IS APPLICABLE, AND APPARENTLY YOU ARE RELYING ON THE STATEMENT OF YOUR POSITION SET FORTH IN A LETTER DATED NOVEMBER 13, 1969, TO ESTABLISH YOUR ENTITLEMENT TO THE REFUND. IN THAT LETTER YOU CONTENDED THAT ONCE THE GOVERNMENT HAD TENDERED TRANSIT BILLING AT AVONDALE, AND THE SHIPMENT HAD BEEN BILLED ON THE BASIS OF THE BALANCE OF THE THROUGH RATE APPLICABLE FROM VALLEJO TO DOYLINE, THE GOVERNMENT COULD NOT THEREAFTER RESCIND SUCH BILLING. YOU STATE THAT SUCH ACTION WOULD VOID THE INITIAL TRANSIT TRANSPORTATION CONTRACT BY SUBSTITUTION OF A COMBINATION OF LOCAL RATES OVER THE INITIALLY DECLARED TRANSIT STATION. IT IS THEREFORE YOUR POSITION THAT ONCE THE TRANSIT BILLING WAS TENDERED AT AVONDALE, THE CONTRACT REQUIRED THAT A THROUGH RATE FROM VALLEJO TO DOYLINE BE PROTECTED AND, BECAUSE OF THAT CHOICE, THERE WAS NO AUTHORITY TO USE A COMBINATION OF RATES TO DEFEAT THE THROUGH RATE.

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 TREATED AS A SINGLE THROUGH SHIPMENT AND THROUGH CHARGES ASSESSED WHICH ARE LOWER THAN THE AGGREGATE OF THE CHARGES OTHERWISE APPLICABLE TO THE SEPARATE SHIPMENTS. WHEN THE AMMUNITION IN QUESTION WAS TENDERED FOR SHIPMENT FROM AVONDALE TO DOYLINE, THERE WAS NO ELECTION ON THE PART OF THE TRANSPORTATION OFFICER TO SUBJECT THE SHIPMENT TO THE PROVISIONS OF THE TRANSIT QUOTATION FOR SETTLEMENT OF THE TRANSIT CHARGES ON THE BASIS OF A FICTITIOUS MOVEMENT FROM VALLEJO TO DOYLINE. IF THIS WERE TRUE, THE TRANSPORTATION OFFICER COULD BE SAID TO HAVE OPTED FOR A TRANSIT LIABILITY, RATHER THAN A TRANSIT PRIVILEGE, BECAUSE THE CHARGES APPLICABLE TO THE FICTIONAL THROUGH SHIPMENT WOULD HAVE EXCEEDED THE AGGREGATE OF THE CHARGES APPLICABLE TO THE SEPARATE SHIPMENTS.

THE SHIPMENT IN QUESTION WAS TENDERED FOR TRANSPORTATION FROM AVONDALE TO DOYLINE, AND THE TRANSPORTATION OFFICER COULD HAVE CANCELLED THE INBOUND TRANSIT CREDITS AT AVONDALE, AND COULD HAVE SHIPPED TO DOYLINE UNDER A STANDARD GOVERNMENT BILL OF LADING. IN THAT CASE, THE APPLICABLE CHARGES ON THE SEPARATE SHIPMENTS UNQUESTIONABLY WOULD HAVE BEEN THE LOCAL RATES TO AND FROM AVONDALE AS SET FORTH IN THE NOTICE OF OVERCHARGE ISSUED TO YOUR COMPANY.

TRANSIT QUOTATION NO. 82-C ITSELF SEEMS TO RECOGNIZE THE RIGHT RESERVED TO THE SHIPPER TO ELECT TO DISREGARD THE TRANSIT FICTION AND TO SETTLE THE CHARGES ON THE BASIS OF THE RATES APPLICABLE ON THE SEPARATE SHIPMENTS. ITEM 27 OF QUOTATION NO. 82-C STATES

"THIS QUOTATION, WHEN ACCEPTED BY THE GOVERNMENT BY MAKING ANY SHIPMENT OR SETTLEMENT UNDER THE TERMS HEREOF OR OTHERWISE, WILL CONSTITUTE AN AGREEMENT BETWEEN THE PARTIES HERETO AS TO THE TRANSPORTATION SERVICES HEREIN DESCRIBED *** ."

THUS THE QUOTATION EXPRESSLY RECOGNIZES THAT SETTLEMENTS MAY BE MADE FOR TRANSPORTATION SERVICES COVERED THEREBY OTHERWISE THAN UNDER THE TERMS OF THE QUOTATION.

ALTHOUGH THE CHARGES FOR THE SHIPMENT IN QUESTION WERE BILLED AND PAID ON THE BASIS OF TRANSIT BALANCES APPLICABLE TO A FICTIONAL THROUGH SHIPMENT, SUCH PAYMENT WAS NOT A SETTLEMENT BECAUSE IT WAS REQUIRED BY LAW TO BE MADE UPON PRESENTATION OF THE BILLS FOR PAYMENT PRIOR TO AUDIT OR SETTLEMENT BY THE GENERAL ACCOUNTING OFFICE. 49 U.S.C. 66. THE SETTLEMENT WAS MADE HERE ON THE BASIS OF THE LOWEST CHARGES AVAILABLE TO THE GOVERNMENT ON THE KIND OF SHIPMENT MADE, THAT IS, BY USE OF A COMBINATION OF RATES MADE OVER AVONDALE, AND THE RIGHT TO MAKE THAT SETTLEMENT WAS RESERVED TO THE GOVERNMENT UNDER THE TERMS OF THE SECTION 22 QUOTATION INVOLVED. IT SEEMS OBVIOUS THAT IN THE ABSENCE OF THE SECTION 22 QUOTATION WHICH EXTENDED THE TRANSIT PRIVILEGE TO THE GOVERNMENT, THE CHARGES NECESSARILY WOULD HAVE TO BE BASED ON A COMBINATION OF RATES FROM AND TO AVONDALE.

FOR THE REASONS STATED, THE SETTLEMENT (TK-917892) DISALLOWING YOUR CLAIM FOR $1,535.60 IS SUSTAINED AND YOUR REFUND CLAIM ACCORDINGLY IS DENIED.