B-17178 L/M, JUN 9, 1941

B-17178 L/M, JUN 9, 1941

PRECIS-UNAVAILABLE

LIEUTENANT COLONEL A. J. MAXWELL, F. D., U. S. ARMY,

THERE HAS BEEN RECEIVED BY FIRST INDORSEMENT OF MAY 22, 1941, FROM THE CHIEF OF FINANCE, YOUR LETTER OF MAY 16, 1941, REQUESTING DECISION WHETHER YOU ARE AUTHORIZED TO MAKE PAYMENT ON A VOUCHER STATED IN FAVOR OF THE AMERICAN LUMBER CORPORATION IN THE AMOUNT OF $27.16 FOR TRANSPORTATION CHARGES ON 1,280 FEET OF LUMBER FURNISHED THE DELAWARE ORDNANCE DEPOT, PEDRICKTOWN, NEW JERSEY, UNDER CONTRACT NO. TPS-38039, DATED JANUARY 7, 1941 (CLASS 39, GENERAL SCHEDULE OF SUPPLIES, PERIOD FEBRUARY 1, 1941, TO APRIL 30, 1941).

THE MATERIAL FACTS IN THE MATTER APPEAR TO BE SET FORTH IN YOUR SECOND INDORSEMENT OF APRIL 22, 1941, IN PERTINENT PART, AS FOLLOWS:

"2. THE VOUCHER IN QUESTION (11554 MARCH 1941, ACCOUNTS

OF THE UNDERSIGNED) COVERED 1280 BOARD FEET OF LUMBER, ITEM

39-L-32530, GENERAL SCHEDULE OF SUPPLIES, PURCHASED

FROM THE AMERICAN LUMBER CORPORATION, BALTIMORE, MD. UNDER

TPS CONTRACT 38039. THAT CONTRACT STIPULATED AS THE

F. O. B. POINT, ABERDEEN, WASHINGTON, OR ANY OTHER POINT EQUAL

IN FREIGHT RATE TO DESTINATION. AS STATED IN PRECEDING

INDORSEMENT, THE CONTRACTOR, AT THE REQUEST OF THE PURCHASING

OFFICER, AND FOR THE CONVENIENCE OF THE GOVERNMENT, FURNISHED

THE LUMBER FROM HIS STOCK IN BALTIMORE, MD. INSTEAD OF FROM

ABERDEEN, WASHINGTON, WITH A VERY SUBSTANTIAL SAVING IN TIME.

"3. SHIPMENT WAS ACTUALLY MADE FROM BALTIMORE TO

PEDRICKTOWN, N. J. BY CONTRACTOR'S TRUCK. CONTRACTOR CHARGED

THE LUMBER AT $2.49 PER HUNDRED FEET AND MADE AN ADDITIONAL

CHARGE OF $27.16 FOR FREIGHT FROM ABERDEEN, WASHINGTON, TO

PEDRICKTOWN, N. J. AT 82[ PER CWT., WHICH, IT IS UNDERSTOOD,

IS THE COMMERCIAL CL RATE BETWEEN THOSE POINTS. BECAUSE

OF CERTAIN DECISIONS OF THE COMPTROLLER GENERAL, FOR EXAMPLE,

8 COMP. GEN. 500 AND 18 COMP. GEN. 953, IT APPEARED THAT THE

CONTRACTOR MIGHT NOT BE ENTITLED TO THE FULL RATE FROM

ABERDEEN TO PEDRICKTOWN, AND SINCE THE CONTRACT APPEARS TO

PROVIDE NO BASIS FOR DETERMINING THE ALLOWANCE FOR SHIPMENT

BY CONTRACTOR'S TRUCK, PAYMENT WAS MADE ON THE BASIS OF THE

CONTRACT PRICE, EXCLUSIVE OF ALL FREIGHT CHARGES.

"4. IT APPEARS THAT CONTRACTOR IS ENTITLED TO SOME FREIGHT

ALLOWANCE, BUT BECAUSE OF THE ABOVE CITED DECISIONS, THIS

OFFICE IS IN DOUBT AS TO THE PROPER ALLOWANCE. IT IS

BELIEVED THAT HAD THE SHIPMENT BEEN MADE FROM ABERDEEN,

WASHINGTON, TO PEDRICKTOWN, N. J., EVEN ON A GOVERNMENT BILL

OF LADING, THE LCL RATE WOULD HAVE BEEN CONSIDERABLY IN

EXCESS OF THE 82[ RATE CHARGED, AND THE TIME REQUIRED FOR

DELIVERY WOULD CERTAINLY HAVE BEEN MUCH GREATER. IT IS

UNDERSTOOD THAT THE LCL RATE FROM BALTIMORE TO PEDRICKTOWN IS

32[ PER CWT. AT WHICH RATE THE FREIGHT CHARGES ON 3312

LBS. WOULD HAVE BEEN $10.60."

THE SITUATION HERE IS UNLIKE THAT INVOLVED IN 8 COMP. GEN. 500, WHERE THE MATTER THERE INVOLVED CONCERNED THE ADJUSTMENT OF FREIGHT CHARGES UNDER CIRCUMSTANCES AS SET FORTH IN FIRST PARAGRAPH OF THE SYLLABUS OF THAT DECISION AS FOLLOWS:

"UNDER THE PROVISIONS OF PARAGRAPH 12 OF FORM A AS

SET FORTH IN THE GENERAL SCHEDULE OF SUPPLIES FOR 1928 AND

INCORPORATED BY REFERENCE IN CONTRACTS FOR SUPPLIES

LISTED THEREIN, TRANSPORTATION CHARGES SAVED BY DELIVERY OF

SHIPMENTS OF 100 POUNDS OR MORE TO POINTS OTHER THAN

WASHINGTON, D. C., ACCRUE TO THE UNITED STATES. ON SUCH

SHIPMENTS THE UNITED STATES IS OBLIGATED TO PAY THE

TRANSPORTATION CHARGES AND THE CONTRACTOR TO DEDUCT FROM HIS

BILL AN AMOUNT EQUIVALENT TO FREIGHT CHARGES ON A LIKE

SHIPMENT FROM HIS SHIPPING POINT TO WASHINGTON, D. C." ALSO, IT IS UNLIKE THE MATTER CONSIDERED IN 18 COMP. GEN. 953 WHEREIN IT WAS HELD THAT (QUOTING FROM THE SYLLABUS):

"WHERE THE GOVERNMENT, FOR THE CONVENIENCE OF THE

CONTRACTOR, PERMITTED SHIPMENT FROM A PLACE OTHER THAN

F. O. B. POINT DESIGNATED IN THE CONTRACT, THE FACT THAT

THE FREIGHT CHARGES PAID BY THE GOVERNMENT TO THE CONTRACT

DESTINATION POINT ARE LESS THAN THE CHARGES WHICH WOULD HAVE

BEEN PAID HAD SHIPMENT BEEN MADE FROM THE CONTRACT SHIPPING

POINT CANNOT OPERATE TO AUTHORIZE PAYMENT TO THE CONTRACTOR

OF THE DIFFERENCE IN FREIGHT CHARGES SAVED TO THE GOVERNMENT."

IN THE INSTANT CASE, THE CONTRACTOR WAS REQUESTED TO EFFECT DELIVERY AT DESTINATION FROM ITS PLANT AT BALTIMORE, MARYLAND, RATHER THAN F. O. B. ABERDEEN, WASHINGTON, THE CONTRACT POINT, THIS FOR THE CONVENIENCE OF THE GOVERNMENT. THE CONTRACTOR ALLEGES THAT IT HAD ALREADY PAID FREIGHT FROM THE MILL AT ABERDEEN, WASHINGTON, TO ITS PLANT AT BALTIMORE, MARYLAND, AND HAS BORNE THE EXPENSE OF DELIVERY BY ITS OWN TRUCK FROM BALTIMORE TO PEDRICKTOWN, NEW JERSEY. IT APPEARS FROM APPLICABLE TARIFFS ON FILE IN THIS OFFICE THAT HAD SHIPMENT BEEN MADE ON GOVERNMENT BILL OF LADING FROM ABERDEEN, WASHINGTON, THE COST OF DELIVERY TO THE GOVERNMENT WOULD HAVE BEEN CONSIDERABLY MORE THAN THE AMOUNT NOW CLAIMED BY THE CONTRACTOR AS TRANSPORTATION CHARGES. ACCORDINGLY, UNDER THE CIRCUMSTANCES, THERE APPEARS NO LEGAL OBJECTION TO PAYMENT TO THE CONTRACTOR OF THE AMOUNT OF $27.16 CLAIMED FOR DELIVERY OF THE LUMBER AT DESTINATION.

THE VOUCHER IS RETURNED HEREWITH AND PAYMENT OF THE FULL AMOUNT THEREOF MAY BE MADE, IF OTHERWISE CORRECT.