B-134259, AUG 5, 1959

B-134259, AUG 5, 1959

TO CENTRAL OF GEORGIA RAILWAY COMPANY:

REFERENCE IS MADE TO YOUR LETTERS OF DECEMBER 2, 1958, APRIL 22 AND APRIL 23, 1959, ADDRESSED TO OUR TRANSPORTATION DIVISION, CONCERNING YOUR FILES NUMBERED N-28774-G-A, N-19324-G-A AND N-23101-G-A, RESPECTIVELY.

YOUR LETTER OF DECEMBER 2, 1958, IS A REQUEST FOR FURTHER CONSIDERATION OF OUR DECISIONS OF MARCH 27, MAY 14 AND NOVEMBER 4, 1958, IN WHICH WE SUSTAINED THE DISALLOWANCE OF YOUR SUPPLEMENTAL CLAIMS 28774-A AND 28774- B. THESE CLAIMS ARE FOR ADDITIONAL FREIGHT CHARGES FOR THE TRANSPORTATION OF "UTILITY LIGHT HARDWOODS" WHICH MOVED FROM MONTGOMERY, ALABAMA, TO SAVANNAH, GEORGIA, FOR EXPORT TO GREAT BRITAIN UNDER LEND-LEASE REQUISITION NO. UK-19000.

YOUR REQUEST FOR FURTHER CONSIDERATION IS BASED UPON THE CONTENTION THAT THE MATERIAL DEVOTED TO "SHIPYARD PLANT AND CONSTRUCTION" WAS FOR CIVIL USE AND THAT NO PROOF OR OTHER SATISFACTORY EVIDENCE HAS BEEN FURNISHED TO THE CONTRARY.

IN DETERMINING THE APPLICABILITY OF LAND-GRANT RATES, THE PROPERTY MOVES FOR "MILITARY OR NAVAL AND NOT FOR CIVIL USE" IF THAT WAS THE INTENDED USE AT THE TIME THE SHIPMENT WAS MADE AND THE ACTUAL USE IS IMMATERIAL. SEE UNITED STATES V. SPOKANE, PORTLAND AND SEATTLE RY.CO., 261 F.2D 681. THE TEST FOR THE INTENDED USE OF THE PROPERTY FOR "MILITARY OR NAVAL AND NOT FOR CIVIL USE" IS EXPRESSED IN NORTHERN PACIFIC R.CO. V. U.S., 330 U.S. 248, 254, AS FOLLOWS:

"* * * MILITARY OR NAVAL USE INCLUDES ALL PROPERTY CONSUMED BY THE ARMED FORCES OR BY THEIR ADJUNCTS, ALL PROPERTY WHICH THEY USE TO FURTHER THEIR PROJECTS, ALL PROPERTY WHICH SERVES THEIR MANY NEEDS OR WANTS IN TRAINING OR PREPARATION FOR WAR, IN COMBAT, IN MAINTAINING THEM AT HOME OR ABROAD, IN THEIR OCCUPATION AFTER VICTORY IS WON. IT IS THE RELATION OF THE SHIPMENT TO THE MILITARY OR NAVAL EFFORT THAT IS CONTROLLING UNDER SEC. 321 (A).'

IT IS OUR VIEW THAT THE "UTILITY LIGHT HARDWOODS" REQUISITIONED FOR USE IN NOVEMBER 1943, IN GREAT BRITAIN AND SHIPPED DURING THE EARLY MONTHS OF 1944 AT WHICH TIMES THE WAR THERE WAS IN ITS MOST CRITICAL PHASE FOR "SHIPYARD PLANT AND CONSTRUCTION" WERE INTENDED TO BE USED FOR THE MILITARY OR NAVAL AND NOT FOR THE CIVIL USE AND WERE, THEREFORE, ENTITLED TO BE SHIPPED AT LAND-GRANT RATES. ALSO, AS STATED IN OUR LETTER OF MARCH 27, 1958, SETTLEMENT AS TO SHIPMENTS UNDER THIS PARTICULAR REQUISITION WAS MADE ON SUCH BASIS IN ATLANTIC COAST LINE RAILROAD COMPANY V. UNITED STATES, COURT OF CLAIMS NO. 48900. WHILE THE SETTLEMENT IN THAT CASE WAS BASED UPON STIPULATION AGREED UPON BY THE PARTIES AND IS NOT BINDING AS TO YOUR CLAIM, THE FACT THAT SUCH AGREEMENT WAS REACHED AND APPROVED BY THE COURT INDICATES THAT SETTLEMENT ON SUCH BASIS IS FAIR AND EQUITABLE. ANY EVENT, WE FIND NO PROPER BASIS FOR MODIFYING OUR PRIOR DECISIONS AS TO YOUR SUPPLEMENTAL CLAIMS 28744-A AND 28774-B, AND OUR DECISIONS OF MARCH 27, MAY 14, AND NOVEMBER 4, 1958, ARE REAFFIRMED. FURTHER CORRESPONDENCE RELATIVE TO THESE CLAIMS NOT PRESENTING ANY FACTS OR EVIDENCE NOT PREVIOUSLY CONSIDERED WOULD APPEAR TO SERVE NO USEFUL PURPOSE.

YOUR LETTERS OF APRIL 22 AND APRIL 23, 1959, FILE NOS. 19324-G-A AND N- 23101-G-A (REQUISITION NUMBERS UK-13805 AND UK-17014) PERTAIN TO CLAIMS ARISING FROM COMMODITY CREDIT CORPORATION SHIPMENTS. LAND GRANT DEDUCTIONS ON LEND-LEASE SHIPMENTS MADE BY THE COMMODITY CREDIT CORPORATION WERE DISCUSSED IN NEGOTIATIONS BETWEEN REPRESENTATIVES OF OUR OFFICE, DEPARTMENT OF JUSTICE AND A SPECIAL JOINT ACCOUNTING LAW COMMITTEE APPOINTED BY THE ACCOUNTING DIVISION AND THE LAW COMMITTEE OF THE ASSOCIATION OF AMERICAN RAILROADS. THE PURPOSE OF THESE NEGOTIATIONS WAS TO EXPLORE THE POSSIBILITY OF REACHING AGREEMENT ON THE SETTLEMENT OF ALL OUTSTANDING LAND-GRANT CLAIMS ON LEND-LEASE SHIPMENTS OF THE COMMODITY CREDIT CORPORATION. A TENTATIVE PROPOSAL OF THE ASSOCIATION OF AMERICAN RAILROADS FOR SETTLEMENT OF LAND-GRANT DEDUCTIONS ON COMMODITY CREDIT CORPORATION LEND-LEASE SHIPMENTS, EXCEPT THE SO-CALLED RUSSIAN REQUISITIONS, IS PRESENTLY BEING CONSIDERED BY THE GOVERNMENT. IF SUCH SETTLEMENT IS ACCEPTED BY THE PARTIES CONCERNED AND YOU FEEL, BASED THEREON, THAT ADDITIONAL AMOUNTS ARE DUE YOU WE WILL BE PLEASED, AT YOUR REQUEST, TO THEN CONSIDER YOUR SUPPLEMENTAL CLAIMS ON THESE SHIPMENTS.