B-160313, NOV. 17, 1966

B-160313, NOV. 17, 1966

TO THE CELOTEX CORPORATION:

YOUR LETTER 50701 433-T OF OCTOBER 17, 1966, REQUESTED RECONSIDERATION OF OUR SETTLEMENT OF OCTOBER 11, 1966, WHICH DISALLOWED YOUR CLAIM IN THE AMOUNT OF $125.16, REPRESENTING THE VALUE OF A QUANTITY OF CELOTEX WALLBOARD PURCHASED BY THE EMBASSY OF THE UNITED STATES, MANILA, PHILIPPINES.

THE WALLBOARD WAS PURCHASED FROM NORTON AND HARRISON CO., INC., P.O. BOX 3176, MANILA, PHILIPPINES, UNDER PURCHASE ORDER 1143-65, DATED FEBRUARY 16, 1965. IT APPEARS THAT THE NORTON AND HARRISON CO., INC., WAS ACTING AS AN AGENT FOR THE CELOTEX CORPORATION. THE PURCHASE ORDER PROVIDED THAT "ORDER IS HEREBY PLACED WITH THE ABOVE-NAMED SELLER FOR ARTICLES OR SERVICES DESCRIBED BELOW, TO BE FURNISHED TO SEAFRONT WAREHOUSE, BLDG. NO. 37 AT SEAFRONT COMPOUND, ROXAS BLVD., PASAY CITY," AND THAT PAYMENT WAS TO BE MADE TO THE CELOTEX CORPORATION UPON RECEIPT OF THE SHIPMENT IN GOOD ORDER.

IN A LETTER TO THE EMBASSY, DATED FEBRUARY 23, 1965, NORTON AND HARRISON ADVISED THAT THEIR PRICE QUOTATION WAS BASED ON DIRECT SHIPMENT TO THE EMBASSY BY CELOTEX AND THAT THE EMBASSY WOULD BE RESPONSIBLE FOR CLEARING THE SHIPMENT. NORTON AND HARRISON REQUESTED EMBASSY CONFIRMATION OF THIS ARRANGEMENT PRIOR TO THE FORWARDING OF THE PURCHASE ORDER TO CELOTEX. THERE IS NO RECORD OF A WRITTEN ACKNOWLEDGMENT OF THESE TERMS; HOWEVER, THE EMBASSY HAS INDICATED THAT THE CONFIRMATION MAY HAVE BEEN MADE BY TELEPHONE.

THE WALLBOARD WAS SHIPPED UNDER AN AMERICAN PIONEER LINE BILL OF LADING NO. 95, ISSUED APRIL 15, 1965, AND APPARENTLY ARRIVED ABOARD THE "PIONEER MAIN" ON MAY 15, 1965. IT WAS THEN DISCHARGED SHIPSIDE TO A LIGHTER AND DELIVERED TO THE CUSTOMS ARRASTRE SERVICE AT PIER 13, FROM WHOSE CUSTODY AND CONTROL IT DISAPPEARED, EITHER THROUGH MISHANDLING OR PILFERAGE. CELOTEX HAD PREVIOUSLY FORWARDED THE SHIPPING DOCUMENTS TO THE EMBASSY ON MAY 10, 1965, AND BY MAY 14 THE PHILIPPINE DEPARTMENT OF FOREIGN AFFAIRS HAD APPROVED A CERTIFICATE OF TAX EXEMPTION ON THE SHIPMENT.

YOU HAVE ALLEGED THAT, SINCE THE DELIVERY WAS "C AND F MANILA," WHEN YOU FORWARDED THE SHIPPING DOCUMENTS TO THE EMBASSY AND THE SHIPMENT ARRIVED IN MANILA, YOU COMPLETED YOUR OBLIGATION. YOU CONTEND FURTHER THAT, HAD THE EMBASSY ACTED PROMPTLY IN LOCATING AND CLEARING THE SHIPMENT, THERE WOULD HAVE BEEN LESS OCCASION FOR LOSS TO OCCUR.

WITH REGARD TO THE SECOND ALLEGATION, WE NOTE THAT THE CERTIFICATE OF TAX EXEMPTION HAD BEEN OBTAINED BY THE TIME THE SHIPMENT ARRIVED. FURTHER, THE CHECKERS OF ALLIED BROKERAGE CORPORATION, THE EMBASSY'S AGENT, BEGAN IMMEDIATELY TO CLEAR AND LOCATE THE SHIPMENT. ON MAY 27, 1965, AFTER SEVERAL DAYS OF UNSUCCESSFUL SEARCHING, ALLIED BROKERAGE ISSUED A PROVISIONAL CLAIM, WHICH IS A NECESSARY STEP IN FILING A FORMAL CLAIM. BELIEVE THAT THEY PROCEEDED AS EXPENDITIOUSLY AS POSSIBLE," TAKING INTO CONSIDERATION THE FACT THAT IT GENERALLY TAKES APPROXIMATELY TEN DAYS TO CLEAR A SHIPMENT THROUGH CUSTOMS.

THE TERM "C. AND F.' MEANS THAT THE PRICE INCLUDES, IN A LUMP SUM, THE COST AND FREIGHT TO A NAMED DESTINATION AND IS GENERALLY SIMILAR TO "C.I.F.' CONTRACTS, PROVIDING FOR COST, INSURANCE AND FREIGHT. MADEIRENSE DO BRASIL S/A V. STULMAN-EMRICK LUMBER CO., 147 F.2D 399. THE GENERAL RULE APPEARS TO BE THAT DELIVERY UNDER THIS TYPE OF CONTRACT MAY BE EFFECTED BY THE SELLER'S PLACING THE GOODS INTO THE HANDS OF THE CARRIER AND FORWARDING THE SHIPPING DOCUMENTS TO THE BUYER. WARNER BROS. AND CO. V. ISRAEL, 101 F.2D 59; COHEN V. WOOD AND SELICK, 212 N.Y.S. 31; NORTHERN GRAIN WAREHOUSE CO. V. NORTHWEST TRADING CO., 201 P. 903. THIS IS NOT TRUE, HOWEVER, WHERE THE CONTRACT OF SALE EVIDENCES A CONTRARY INTENT. MADEIRENSE DO BRASIL S/A V. STULMAN-EMRICK LUMBER CO., SUPRA; SEAVER V. LINDSAY LIGHT CO., 135 N.E. 329. IN THIS INSTANCE, THE PURCHASE ORDER ISSUED BY THE EMBASSY AND ACCEPTED BY NORTON AND HARRISON, EXCEPT AS OTHERWISE MODIFIED BY THE LATTER CONCERN AND POSSIBLY CONFIRMED BY THE EMBASSY, SPECIFIES DELIVERY TO A PARTICULAR ADDRESS. THEREFORE, THE DELIVERY WOULD NOT BE COMPLETE UNTIL THE SHIPMENT REACHED THIS LOCATION. WHILE THE GOVERNMENT MAY HAVE AGREED TO ASSUME RESPONSIBILITY FOR CLEARING THE MATERIAL THROUGH CUSTOMS, THERE IS NO EVIDENCE THAT IT ASSUMED ANY GREATER RESPONSIBILITY.

SINCE THE MATERIAL DID NOT REACH THE ULTIMATE DESTINATION, THERE IS NO LIABILITY ON THE UNITED STATES TO MAKE PAYMENT UNDER THE PURCHASE ORDER. ACCORDINGLY, OUR SETTLEMENT IS SUSTAINED.