B-174236, MAY 5, 1972, 51 COMP GEN 714

B-174236: May 5, 1972

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TRANSPORTATION - RATES - INCREASES - EX-PARTE - EFFECTIVE DATE THE INTRASTATE SHIPMENTS OF SEVERAL CARLOADS OF AVIATION FUEL THAT HAD BEEN ORIGINALLY SHIPPED IN INTERSTATE COMMERCE UNDER GOVERNMENT BILLS OF LADING TO STORAGE AREAS OTHER THAN THE POINTS INVOLVED IN THE RESHIPMENTS AND COMMINGLED WITH OTHER FUEL SHIPMENTS ARE INDEPENDENT SHIPMENTS AND ARE NOT A CONTINUITY OF THE ORIGINAL INTERSTATE TRANSPORTATION. WHICH ENDED WHEN THE FUEL WAS STORED AND. THE RESHIPMENTS ARE NOT SUBJECT TO THE RATE INCREASE AND THE CLAIM FOR ADDITIONAL FREIGHT CHARGES BASED ON THE EX-PARTE RATE INCREASE IS NOT APPLICABLE AND MAY NOT BE ALLOWED. 1972: FURTHER REFERENCE IS MADE TO YOUR LETTER DATED SEPTEMBER 27.

B-174236, MAY 5, 1972, 51 COMP GEN 714

TRANSPORTATION - RATES - INCREASES - EX-PARTE - EFFECTIVE DATE THE INTRASTATE SHIPMENTS OF SEVERAL CARLOADS OF AVIATION FUEL THAT HAD BEEN ORIGINALLY SHIPPED IN INTERSTATE COMMERCE UNDER GOVERNMENT BILLS OF LADING TO STORAGE AREAS OTHER THAN THE POINTS INVOLVED IN THE RESHIPMENTS AND COMMINGLED WITH OTHER FUEL SHIPMENTS ARE INDEPENDENT SHIPMENTS AND ARE NOT A CONTINUITY OF THE ORIGINAL INTERSTATE TRANSPORTATION, WHICH ENDED WHEN THE FUEL WAS STORED AND, IN ADDITION, SINCE THE INTRASTATE RESHIPMENTS MOVED WITHIN THE 30-DAY NOTICE PERIOD OF AN EX-PARTE RATE INCREASES, THE RESHIPMENTS ARE NOT SUBJECT TO THE RATE INCREASE AND THE CLAIM FOR ADDITIONAL FREIGHT CHARGES BASED ON THE EX-PARTE RATE INCREASE IS NOT APPLICABLE AND MAY NOT BE ALLOWED.

TO CAPE FEAR RAILWAYS, INC., MAY 5, 1972:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED SEPTEMBER 27, 1971, IN WHICH YOU REQUEST REVIEW OF THE SETTLEMENT (TK-908952) BY WHICH OUR OFFICE DISALLOWED THE $112.08 IN ADDITIONAL FREIGHT CHARGES CLAIMED ON THE RAIL SHIPMENTS WHICH MOVED UNDER GOVERNMENT BILLS OF LADING F 0703603 THROUGH F -0703606. THOSE SHIPMENTS CONSISTED OF SEVERAL CARLOADS EACH OF JP-4 AVIATION FUEL TRANSPORTED FROM RIVER TERMINAL AT FAYETTEVILLE, N.C., TO POPE AIR FORCE BASE, FORT BRAGG, N.C., DURING NOVEMBER 1969.

IT IS AGREED THAT SOUTHERN FREIGHT ASSOCIATION SECTION 22 QUOTATION A 3941 HAS APPLICATION ON THE FREIGHT MOVEMENTS, BUT THERE IS DISAGREEMENT AS TO WHETHER THE INCREASE PROVIDED IN EX-PARTE 262 IS APPLICABLE.

OUR OFFICE IS ADVISED BY THE DEPARTMENT OF THE AIR FORCE THAT THE SHIPMENTS FROM RIVER TERMINAL TO POPE AIR FORCE BASE WERE NOT A PART OF THROUGH TRANSPORTATION FROM TEXAS. THE SHIPMENTS FROM TEXAS WERE CONSIGNED TO BEAUFORT, N.C., AND TO CHARLESTON, S.C., AND AT THE TIME OF DEPARTURE FROM TEXAS, NO OTHER DESTINATIONS WERE KNOWN. UPON ARRIVAL AT THE TWO NAMED EASTERN SEABOARD POINTS, THE CONTENTS OF THE OCEAN TANKERS WERE PUMPED INTO STORAGE TANKS AND COMMINGLED WITH OTHER JP-4 FUEL WHICH WAS CONTAINED THEREIN. THE TRANSPORTATION SERVICE ENDED AT THOSE POINTS AND THE FUEL CAME TO REST.

AS REQUISITION ORDERS WERE RECEIVED FROM GOVERNMENT CONSUMING INSTALLATIONS AND OTHER BULK STORAGE STATIONS, NEW SHIPMENTS WERE MADE UNDER SEPARATE BILLS OF LADING VIA EITHER PIPELINE, MOTOR, RAIL OR BARGE CONVEYANCES IN THE SPECIFIED QUANTITIES REQUESTED BY EACH INSTALLATION.

AS THE SUPPLIES OF JP-4 FUEL AT RIVER TERMINAL BECAME DEPLETED OR LOW, ADDITIONAL QUANTITIES OF THE FUEL WERE REQUESTED FROM EITHER OR BOTH OF THE INSTALLATIONS LOCATED AT BEAUFORT, N.C., AND/OR CHARLESTON, S.C. WE UNDERSTAND THAT THE SHIPMENTS TO RIVER TERMINAL GENERALLY WERE TRANSPORTED BY BARGE AND THAT THE FUEL WAS PUMPED FROM THE BARGES INTO STORAGE TANKS. THE STORAGE FACILITY WAS OPERATED BY CHEMPHALT OF CAROLINA, INC., FOR THE GOVERNMENT. AT THE TIME OF ARRIVAL AT RIVER TERMINAL, THE ULTIMATE DESTINATION OF THE JP-4 FUEL WAS STILL NOT KNOWN, SINCE BOTH POPE AIR FORCE BASE AND SIMMONS ARMY AIRFIELD REQUISITIONED JP-4 FUEL AS NEEDED FROM RIVER TERMINAL. ON RESHIPMENT FROM RIVER TERMINAL, NEW TRANSPORTATION DOCUMENTS WERE AGAIN ISSUED AND THE SHIPMENTS WERE TREATED AS SEPARATE FREIGHT MOVEMENTS RATHER THAN AS A CONTINUATION OF THE PREVIOUS TRANSPORTATION BY OCEAN TANKER AND BARGE.

THE GOVERNMENT'S WHOLE PLAN WAS TO ARRANGE STORAGE POINTS ON THE EASTERN SEABOARD FROM WHICH DISTRIBUTION MIGHT BE EFFECTED AS REQUIRED, WITHOUT ANY UNNECESSARY DELAYS IN THE SUPPLY. UNDER THE PLAN THERE IS NEITHER NECESSITY NOR PURPOSE IN HAVING CONTINUITY OF TRANSPORTATION. THE STORAGE DEPOTS ARE THE NATURAL PLACES FOR A CHANGE FROM INTERSTATE TO INTRASTATE TRANSPORTATION. THERE IS NOTHING OF RECORD HERE THAT ESTABLISHES AN INTENT BY THE GOVERNMENT FOR CONTINUOUS TRANSPORTATION FROM TEXAS TO POPE AIR FORCE BASE, NORTH CAROLINA.

THE RESHIPMENT OF AN INTERSTATE SHIPMENT DOES NOT NECESSARILY ESTABLISH A CONTINUITY OF MOVEMENT OR PRESENT THE SHIPMENT TO A POINT WITHIN THE SAME STATE FROM HAVING AN INDEPENDENT OR INTRASTATE CHARACTER. CHICAGO, M. & ST. P. RY. CO. V. IOWA, 233 U.S. 334 (1914); ATLANTIC COAST LINE R. V. STANDARD OIL CO., 275 U.S. 257 (1927). OWNERSHIP OF THE PROPERTY OR THE POINT OF PASSAGE OF TITLE ALSO IS NOT DETERMINATIVE OF WHETHER THE SHIPMENT IS AN INTERSTATE OR INTRASTATE MOVEMENT. PENNSYLVANIA R. V. CLARK BROS., 238 U.S. 456, 466 (1915); B.&O. S.W.R. V. SETTLE, 260 U.S. 166 (1922). WHEN THE JP-4 FUEL WAS UNLOADED FROM THE OCEAN TANKERS, MIXED WITH OTHER FUEL IN THE STORAGE TANKS, AND THEREIN STORED, THE INTERSTATE COMMERCE ENDED FOR ALL PURPOSES. GENERAL OIL V. CRAIN, 209 U.S. 211 (1908); SONNEBORN BROS. V. CURETON, 262 U.S. 506 (1923); PETROLEUM PRODUCTS TRANSPORTED WITHIN A SINGLE STATE, 71 I.C.C. 17, 26-32 (1957). THUS, WE CONCLUDE THAT THE FREIGHT MOVEMENTS FROM RIVER TERMINAL TO POPE AIR FORCE BASE ARE INTRASTATE IN CHARACTER.

BUT WHETHER THE PARTICULAR SHIPMENTS FROM RIVER TERMINAL TO POPE AIR FORCE BASE ARE INTERSTATE OR INTRASTATE IN CHARACTER IS NOT IN OUR VIEW CONTROLLING AS TO THE VALIDITY OF YOUR CLAIM FOR ADDITIONAL CHARGES AS TO THE INSTANT SHIPMENTS. BY AMENDMENT 5 TO QUOTATION SFA-3941, ISSUED ON NOVEMBER 11, 1969, THE RAILROADS PARTIES TO THE QUOTATION PURPORT TO MAKE THE RATES NAMED THEREIN SUBJECT TO THE INCREASE IN EX-PARTE 262 EFFECTIVE NOVEMBER 18, 1969. BUT APPENDIX "A" TO QUOTATION A-3941 IN A PARAGRAPH HEADED "TERMINATION OR MODIFICATION OF QUOTATION" AUTHORIZES CANCELLATION OR MODIFICATION OF THE QUOTATION BY EITHER PARTY ON 30 DAYS WRITTEN NOTICE TO THE OTHER. IT ALSO PROVIDES THAT MODIFICATION OF THE QUOTATION MAY BE ACCOMPLISHED BY THE RAILROAD PARTIES TO THE QUOTATION UPON SHORTER NOTICE SUBJECT TO THE MUTUAL AGREEMENT OF THE PARTIES. THERE IS NOTHING OF RECORD, HOWEVER, TO ESTABLISH THAT THE MILITARY TRAFFIC MANAGEMENT AND TERMINAL SERVICE (MTMTS) CONCURRED IN THE INCREASE ON ANY SHORTER NOTICE THAN 30 DAYS. THEREFORE, THE INCREASE WAS NOT EFFECTIVE UNTIL 30 DAYS AFTER NOTICE OF THE INCREASE WAS FURNISHED MTMTS BY THE CARRIERS.

SINCE THE NOTICE WAS NOT GIVEN EARLIER THAN NOVEMBER 11, 1969, IT WAS NOT EFFECTIVE AS TO SHIPMENTS MOVING WITHIN 30 DAYS OF SUCH DATE. THE INCREASE THUS IS NOT APPLICABLE ON THE SHIPMENTS INVOLVED WHICH AS INDICATED ABOVE MOVED DURING NOVEMBER 1969.

THE DISALLOWANCE OF YOUR CLAIM FOR $112.08 THEREFORE WAS PROPER AND IS SUSTAINED.