Appeal of Navy Setoff Action

B-202117: May 20, 1981

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A carrier appealed a setoff action by the Navy in the amount of $750 for damage sustained to a mobile home which allegedly occurred while the appellant was transporting it from South Carolina to Florida. The owner, a Navy member, submitted a claim to the Navy because of the damage to the left rear corner of the home at the point of collision with a car. The appellant did not dispute its liability for the left rear damage and has agreed to pay for the repairs. However, a significant portion of the setoff relates to structural repairs to the front exterior and interior of the home. The appellant argued that this damage was not caused by the collision, but was caused by the owner's attempt to lift the home onto blocks. The appellant relied on information provided by its adjuster, who found that after delivery, the owner improperly used an automobile jack to lift the unit, causing damage to the front. Where the Government can establish a prima facie case of carrier liability, the burden of proof shifts to the carrier to show that it was not liable for the damage. However, in this case, the record failed to establish two of the three elements of liability: that the shipment was delivered in the damaged state alleged by the Navy and the amount of damages. The delivery receipt showed that the home arrived in good order except for the damage to the rear corner cause by the collision. Damage to the front was not noted. In a letter from the Navy to the owner, the Navy stated that it was not giving him his full claim because of the apparent uncertainty as to how the damage to his mobile home occurred. This statement and others in the record indicated the lack of a prima facie case of carrier liability. GAO did not believe that the Government established that the carrier delivered the home in the damaged condition claimed. GAO held that the $750, less an amount for repair of the damage to the rear of the home, not in dispute, should be refunded to the appellant.