B-147964, JUN 22, 1962

B-147964, JUN 22, 1962

TO UNIVERSAL CARLOADING AND DISTRIBUTING CO., INC.:

REFERENCE IS MADE TO YOUR LETTER OF MAY 24, 1962, AND EARLIER LETTERS, PROTESTING THE DISALLOWANCE OF YOUR CLAIM NGO-2594-C, FOR REFUND OF $8,980.12, ADMINISTRATIVELY DEDUCTED TO COVER THE COST OF DAMAGES IN TRANSIT TO GOVERNMENT PROPERTY MOVING UNDER GOVERNMENT BILL OF LADING NO. AF-7580757.

THE RECORD SHOWS THAT THIS EQUIPMENT, SHIPPED FROM THE SPERRY GYROSCOPE COMPANY, LONG ISLAND, NEW YORK, TO THE CONVAIR DIVISION OF GENERAL DYNAMICS CORPORATION, BENBROOK, TEXAS, WAS INITIALLY PICKED UP DECEMBER 26, 1957, AT THE SPERRY GYROSCOPE FACTORY BY YOUR DRAYMAN, CARDINALE TRUCKING. DELIVERY WAS MADE TO YOUR DOCK FOR MOVEMENT TO DESTINATION IN A DIRECT RAILROAD CAR. THE BILL OF LADING WAS RECEIPTED FOR AT ORIGIN BY MR. WOLF, THE DRIVER FOR CARDINALE TRUCKING, AND AT DESTINATION BY THE CONSIGNEE WITHOUT ANY EXCEPTION BEING NOTED ON THE BILL OF LADING. HOWEVER, WHEN THE ARTICLES WERE UNCRATED AT CONSIGNEE'S PLANT, EXTENSIVE DAMAGE WAS DISCOVERED.

THE ADMINISTRATIVE ACTION IN MAKING THE DEDUCTION IN QUESTION WAS BASED ON THE DETERMINATION THAT THE CAUSE OF THE DAMAGE WAS DUE TO ROUGH HANDLING WHILE THE PROPERTY WAS IN YOUR POSSESSION. YOU DENY THAT THE SHIPMENT RECEIVED ROUGH HANDLING AND STATE THAT THE SOLE CAUSE OF THE DAMAGE WAS IMPROPER PACKAGING, WHICH RELIEVES YOU OF LIABILITY. THIS CONCLUSION APPEARS TO BE BASED ON THE STATEMENT OF MR. S. E. KELLY, CHIEF QUALITY CONTROL DIVISION, CONVAIR, FORT WORTH, TEXAS, DATED JANUARY 15, 1958, WHERE, AMONG OTHER REMARKS, IT WAS SAID THAT THE EQUIPMENT WAS NOT BLOCKED, BRACED AND CUSHIONED ADEQUATELY TO PROTECT IT FROM DAMAGE DURING TRANSIT. YOU APPARENTLY CONCLUDE FROM THIS STATEMENT THAT PACKING AND CRATING OF THE EQUIPMENT FOR SHIPMENT WAS IN SOME WAY DEFICIENT.

WE FEEL, HOWEVER, THAT SUCH A CONCLUSION IS NOT ENTIRELY WARRANTED ON THE BASIS OF MR. KELLY'S STATEMENT. IT IS NOT CLEAR TO US WHETHER MR. KELLY'S REFERENCE TO BLOCKING, BRACING AND CUSHIONING IS DIRECTED TO THE INTERIOR PACKING OF THE ARTICLES WITHIN THE EXTERIOR CRATES, OR TO THE BLOCKING, BRACING AND CUSHIONING OF THE CRATES IN THE FREIGHT CAR. WE SAY THIS FOR THE REASON THAT GENERALLY BLOCKING, BRACING AND CUSHIONING HAVE REFERENCE TO DUNNAGE USED TO PROTECT SHIPMENTS. SEE RULE 30 OF UNIFORM FREIGHT CLASSIFICATION 4.

WE NOTE THAT YOUR LETTER OF AUGUST 10, 1961, IN DISCUSSING THE REPORTS OF MR. KELLY AND THE REPORT OF OCTOBER 10, 1960, FROM MR. R. A. SMITH (DIRECTORATE OF ADJUDICATION, UNITED STATES AIR FORCE, DENVER, COLORADO) TO OUR OFFICE, SUGGESTS THAT ROUGH HANDLING HAS NOT BEEN PROVEN AND THAT, IN THIS CASE, THE SHIPPER'S NEGLIGENCE WAS THE SOLE CAUSE OF THE DAMAGE. IT IS YOUR POSITION THAT IF THIS SHIPMENT HAD BEEN PROPERLY PROTECTED BY THE SHIPPER, THE DAMAGE WOULD NOT HAVE OCCURRED.

SINCE IT HAS BEEN REPORTED THAT THE CRATES WERE DELIVERED TO THE CONSIGNEE WITHOUT EXTERNAL SIGNS OF DAMAGE, THIS CLAIM INVOLVES CONCEALED DAMAGE AND WE REALIZE THAT THE GOVERNMENT HAS THE BURDEN OF SHOWING THAT THE GOODS WERE DELIVERED TO THE CARRIER IN GOOD CONDITION, OR AT LEAST IN A BETTER CONDITION THAN THEY WERE RECEIVED AT DESTINATION. HAMILTON FOODS, INC. V. ATCHISON, TOPEKA AND SANTA FE RAILWAY COMPANY, 83 F.SUPP. 478; OHIO GALVANIZING AND MFG.CO. V. SOUTHERN PACIFIC COMPANY, 39 F.2D 840. WE REALIZE ALSO THAT "A CARRIER IS NOT AN INSURER OF GOODS ENTRUSTED TO IT AS TO DAMAGE WHICH RESULTS FROM THE FAULT OF THE SHIPPER, SUCH AS IMPROPER PACKING OF THE MERCHANDISE.' WELLS LAUNDRY AND LINEN SUPPLY CO., INC. V. ACME FAST FREIGHT, INC., 85 A.2D 907. THE AUTHORITIES STAND FOR THE PROPOSITION THAT THE GOVERNMENT DOES NOT HAVE TO ESTABLISH THAT ROUGH HANDLING CAUSED THE DAMAGE; THE GOVERNMENT MUST SHOW THAT THE GOODS WERE IN GOOD CONDITION WHEN DELIVERED TO THE CARRIER AND THAT THE DAMAGE INCURRED WAS NOT THE RESULT OF IMPROPER PACKING.

COPIES OF THE PERTINENT PAPERS RECEIVED FROM THE ADMINISTRATIVE OFFICE WERE FURNISHED YOU WITH OUR TRANSPORTATION DIVISION'S LETTER OF JANUARY 31, 1961. FROM THESE PAPERS IT MAY BE NOTED THAT THE SPERRY GYROSCOPE COMPANY MATERIAL INSPECTION AND RECEIVING REPORT DATED DECEMBER 23, 1957, SHOWS THAT THE EQUIPMENT WAS INSPECTED BY AN AIR FORCE INSPECTOR AT THE CONTRACTOR'S PLANT, WHO FOUND THE EQUIPMENT TO CONFORM TO THE TERMS OF THE CONTRACT. IT IS CLEAR THAT THE EQUIPMENT THEN WAS IN GOOD CONDITION. ALL THE ITEMS WERE PACKED FOR SHIPMENT BY THE MANUFACTURER. WITH RESPECT TO THE ITEM CONSTITUTING THE MAJOR PORTION OF THE MONETARY DAMAGES, THE ROLL TABLE, IT MAY BE NOTED THAT CAREFULLY DRAWN PLANS FOR PACKING THIS ARTICLE WERE PREPARED. SINCE THIS RECORD ALSO SHOWS THAT THE MANUFACTURER ACTUALLY PACKED THE ITEM IN ACCORDANCE WITH THOSE PLANS, WE CANNOT CONCLUDE THAT THIS ITEM, OR ANY OTHER ITEM IN THE SHIPMENT, WAS IMPROPERLY PACKED SO AS TO RELIEVE YOUR COMPANY FROM LIABILITY.

AS INDICATED ABOVE, WE HAVE NO DUTY UNDER THE LAW TO ESTABLISH THE CARRIER'S NEGLIGENCE DUE TO ROUGH HANDLING. WE THINK THAT THE SHIPPER ADEQUATELY PACKAGED THE ARTICLES FOR SAFE SHIPMENT. CONCERNING YOUR RELIANCE UPON MR. KELLY'S STATEMENT AS SHOWING THAT THE DAMAGE WAS DUE TO IMPROPER PACKING, YOU FEEL THAT HIS STATEMENT (ATTRIBUTING THE DAMAGE TO ROUGH HANDLING) SHOULD BE GIVEN PREFERENCE OVER MR. SMITH'S STATEMENT OF OCTOBER 10, 1960, TO US BECAUSE MR. KELLY WAS AT THE CONSIGNEE'S PREMISES AND WAS THERE WHEN THE SHIPMENT WAS DELIVERED AND "COULD INSPECT THE SHIPMENT PERSONALLY.' HOWEVER, MR. KELLY'S REPORT, WHICH WAS PREPARED ABOUT TWO WEEKS AFTER DELIVERY OF THE SHIPMENT, DOES NOT SHOW THAT MR. KELLY DID INSPECT THE SHIPMENT. ON THE OTHER HAND, THE TEXAS AND PACIFIC RAILWAY INSPECTOR'S REPORT DATED JANUARY 3, 1958 (A COPY WAS FURNISHED YOU), SHOWS THE EXTENT OF THE DAMAGE, THE DATE AND PLACE OF INSPECTION, AND THAT A "W. CLARK" APPARENTLY REPRESENTED THE CONSIGNEE AT THIS INSPECTION. IT IS OF SOME SIGNIFICANCE THAT THIS INSPECTION REPORT MAKES NO EFFORT TO FIX THE CAUSE OF THE DAMAGE.

WE NOTE, ALSO, THAT AN "INSPECTION PHYSICAL RECEIVING REPORT," DATED JANUARY 3, 1958, BY CONVAIR, SIGNED BY "J. H. SHARPE" STATES ON PAGE 3 THEREOF THAT THE UNITS "SHOW SIGNS OF BOTH IMPROPER PACKAGING AND IMPROPER HANDLING.' THIS REPORT ALSO PRECEDES IN DATE MR. KELLY'S REPORT, UPON WHICH YOU RELY. WE FEEL THAT MR. SHARPE'S REPORT SHOULD BE ACCORDED GREATER WEIGHT THAN MR. KELLY'S SINCE IT IS BASED ON PERSONAL INSPECTION. SINCE THIS REPORT SUGGESTS THAT IMPROPER HANDLING, AS WELL AS IMPROPER PACKAGING, CAUSED THIS DAMAGE, IT WOULD SERVE TO ESTABLISH YOUR LIABILITY IN THIS CASE, SINCE IT IS SETTLED THAT A CARRIER STILL IS LIABLE IF THE FAULT OF THE CARRIER CONTRIBUTED TO CAUSE THE DAMAGE. WELLS LAUNDRY AND LINEN SUPPLY CO. V. ACME FAST FREIGHT, INC., 83 A.2D 907, 909, AND CASES CITED THEREIN.

THEREFORE, ON THE BASIS OF THE PRESENT RECORD IT DOES NOT APPEAR THAT THE CAUSE OF DAMAGE IN THIS CASE WAS SUCH THAT YOUR COMPANY WOULD BE RELIEVED OF LIABILITY, AND THE DISALLOWANCE OF YOUR ..END :