B-241192, Jun 7, 1991, 91-1 CPD ***

B-241192, Jun 7, 1991, 91-1 CPD ***

PROCUREMENT - Payment/Discharge - Shipment - Storage charges DIGEST: 1. The General Services Administration properly disallowed the claimant's storage charges under Item 1100(1) of the agency's National Rules Tender 100 since none of the shipments appeared to have been held in storage by reason of an act of the consignor or consignee and, for nearly half the shipments, the goods the claimant was to deliver were not in its possession when it made the delivery appointments. 2. The General Services Administration properly disallowed the claimant's storage charges under Item 1100(2) of the agency's National Rules Tender 100 because the shipments were not being stored at the claimant's destination terminal; the claimant was not detained in making its deliveries at the consignees' facilities; and the claimant failed to follow the required notification procedures. 3. The General Services Administration properly disallowed storage charges under Item 375 of the agency's National Rules Tender 100 because storage charges under Item 375 are to be assessed in accordance with Item 1100, and storage charges are not payable under Item 1100.

A-Line, Ltd.:

A-Line, Ltd., an interstate motor common carrier, requests that our Office overrule a General Services Administration (GSA) decision disallowing storage charges in the amount of $21,154, plus interest. For the reasons given below, we concur in GSA's decision.

In February and March of 1990, A-Line assessed storage charges on shipments it picked up at the GSA Federal Supply Service Distribution Center in Belle Mead, New Jersey. Prior to delivery, A-Line stored these shipments at its Philadelphia terminal, which is about 55 miles from Belle Mead. /1/ The shipments were subsequently delivered to Navy Supply Centers in Norfolk, Virginia, and Charleston, South Carolina.

The shipments were made pursuant to government bills of lading, many of which indicated that the carrier was to call the consignee for a delivery appointment. The record indicates that A-Line regularly made these calls from its Philadelphia terminal. The record also suggests that for nearly half of the shipments A-Line scheduled delivery appointments before picking up the shipments at GSA's Belle Mead facility. A-Line typically notified the consignees about the number of trucks it would have for unloading, but did not indicate the shipment weight or the commodities involved.

A-Line asks that we review GSA's decision, made in a prepayment audit of the carrier's bills, to disallow the storage charges.

Item 1100

The shipments were governed by GSA National Rules Tender 100. Item 1100 of Rules Tender 100 covers "Storage," and generally states that freight held in a carrier's possession by reason of an act or omission of the consignor or consignee, through no fault of the carrier, will be considered stored immediately. This general provision is subject to several more specific provisions, two of which are relevant here.

Paragraph (1) of Item 1100 states that storage charges on freight awaiting linehaul transportation will begin at 7:00 a.m. the day after freight is received by the carrier. Paragraph (2) states that storage charges on undelivered freight will begin at 7:00 a.m. the first business day after notice of arrival has been given as provided in Item 125. /2/ Paragraph (2) is further explained by a note (note 2) stating that when a carrier has been given instructions at the time of shipment or prior to giving notice of arrival, as provided in Item 125, that a consignee will not accept freight for more than 24 hours, storage charges are to begin at 7:00 a.m. the first business day after arrival at the carrier's destination terminal.

Item 125 referred to in Item 1100(2) covers "Arrival Notice and Undelivered Freight." Paragraph (2) of Item 125 provides that when a shipment is not actually tendered for delivery, notice of arrival will be given to the consignee no later than the next business day following arrival of the shipment. If convenient and practicable, the notice is to be given by telephone. The notice is to specify the point of origin, consignor, commodity and weight of the shipment.

A-Line states that the applicable bills of lading required it to obtain delivery appointments to find out the date and time the consignee would be able to receive the shipments. A-Line then stored the freight until the delivery date, at what A-Line describes as its destination terminal in Philadelphia.

GSA determined that neither Item 1100 nor Item 125 supports paying storage charges to A-Line. GSA concluded that Item 1100(1) applies only when carriers are specifically instructed to stop shipments in route, for reasons such as strikes, riots, reassignments or acts of God, and to hold the shipments until further instructions are given. GSA found paragraph (1) inapplicable to all the shipments because none of the shipments were in A-Line's possession by reason of an act of the consignor or consignee and, for approximately half the shipments, because A-Line made the delivery appointments before it picked up the goods that were to be shipped.

GSA further concluded that storage charges also were not warranted under Item 1100(2), since A-Line neither offered the shipments for delivery nor provided notice to the consignees at destination that the shipments had arrived. GSA found that A-Line's Philadelphia terminal could not be considered a destination terminal for shipments consigned to Norfolk or Charleston; GSA described this terminal as a pick-up terminal used to consolidate the small shipments obtained at Belle Mead into truckload lots.

GSA also maintains that A-Line's notification procedures did not comply with Item 125(2). The calls A-Line made to Norfolk and Charleston really were not notifications of arrival, but were for scheduling delivery appointments and, for about half of the shipments, were made before A-Line had picked up the shipments at Belle Mead. Even assuming the calls were notifications, they were insufficient since A-Line did not provide to the consignees the required information about commodities and shipment weights.

We agree that A-Line should not be paid storage charges under Item 1100.

Item 1100(1) does not apply because none of the shipments appeared to have been held in storage by reason of an act of the consignor or consignee. In every instance, A-Line called the consignees at A-Line's own convenience for delivery appointments for its truckload lots, which A- Line had decided to consolidate from the smaller shipments picked up at Belle Mead. Furthermore, for nearly half the shipments the goods A Line was to deliver were not even in its possession when it made the delivery appointments.

We also find that A-Line's claim is not payable pursuant to paragraph (2) of Item 1100, which addresses storage charges beginning the first business day after arrival at the carrier's destination terminal. A-Line used the Philadelphia terminal to consolidate shipments for making truckload deliveries to the Norfolk and Charleston destinations. This terminal is located some 55 miles from GSA's Belle Mead facility where all the shipments were picked up. On the other hand, the Philadelphia terminal is approximately 265 miles from Norfolk and 625 miles from Charleston. our view, A-Line's facility in Philadelphia cannot be considered a destination terminal for purposes of Item 1100(2). /3/

Another reason payment is not warranted under Item 1100(2) is that, as GSA points out, A-Line did not fulfill the notification requirements of Item 125, which Item 1100(2) incorporates by reference.

Item 375

Item 375 of Rules Tender 100 covers prearranged scheduling of vehicle arrival for loading or unloading. Item 375 provides that upon reasonable request of the consignor or consignee, carriers will prearrange schedules for arrival of vehicles, for loading or unloading shipments, without additional charge. The request for prearranged scheduling may be oral or in writing. The scheduled time for arrival of vehicles for unloading should be prior to the time storage charges would begin to accrue. When arrival for unloading is not so scheduled, storage charges are to be assessed as provided in Item 1100.

A-Line maintains that to the extent Item 375 applied to the shipments, storage charges were appropriately assessed. The scheduled times of arrival for the shipments regularly were after the time storage charges began to accrue.

GSA also determined that A-Line's relations with the consignees substantially followed Item 375. GSA concluded, however, that storage charges allowed by Item 375 were not payable because the consignee never requested A-Line to enter into this arrangement. A-Line initiated the prearranged deliveries for its convenience.

We agree that the course of conduct between A-Line and the consignees generally seems to have been consistent with the prearranged scheduling covered by Item 375. Nevertheless, note (3) of Item 375 provides that storage for prearranged deliveries is to be made as provided in Item 1100. As indicated above, A-Line is not entitled to storage charges under Item 1100; thus, the carrier would not be entitled to the charges under Item 375.

In sum, we agree with GSA's decision not to allow the storage charges in issue.

/1/ A-Line also has terminals in Chicago, and Denton, Texas.

/2/ Under this provision, no charges are to be made when actual tender of delivery is made within 24 hours after notice of arrival has been given.

/3/ We also note there is no evidence in the record to suggest that A- Line was detained in making its deliveries at the consignees' facilities in Norfolk and Charleston.