#### CHARLES E. SCHAFF, RECEIVER OF THE RAILROAD AND PROPERTY OF THE MISSOURI, KANSAS & TEXAS RAILWAY COMPANY OF TEXAS, v. THE UNITED STATES.

[No. 274-A.

Decided February 12, 1923.]

*On the Proofs.*

*Railroad rates; party plus individual fares: voluntary*payment.— Where a carrier makes out its bills for transportation of passengers on a basis of party plus individual fares, and the disbursing officer pays the bills as presented and payment is received by the carrier without protest or objection, such carrier is not entitled to recover the difference between the compensation received and compensation based on individual fares.

*Same; involuntary payment.*— Where a carrier presents its bills after making land-grant deductions and other deductions required by the military arrangement described, and the disbursing and accounting officers make further deductions by applying a rate based on a combination of party and individual fares, the carrier is entitled to recover such further deductions. See *Atchison, Topeka A Santa Re Ry. Go.*v. *Uwited States,*256 U. S., 205.

*The Reporter’s*statement of the case:

*Mr. Alexander Britton*for the plaintiff. *Britton <& Gray*were on the briefs.

*Mr. Perry W.*Howard, with whom was *Mr. Assistant Attorney General Robert H.*Lovett, for the defendant.

*88The following are the facts of the case as found by the court:

I. The plaintiff, Charles E. Schaff, is the receiver duly appointed, qualified, and acting of the property of the Missouri, Kansas & Texas Kailway Co. of Texas, a corporation organized under the laws of the State of Texas, and now operates the system of railways formerly and for a long time operated by the said corporation in the State of Texas. At all times hereinafter mentioned the railroad company has been a common carrier for hire of freight and passengers, and has established tariffs for such transportation, which were duly published and filed with the Interstate Commerce Commission, as required by law.

II. At various times prior to the dates of the transportation hereinafter referred to the plaintiff, with other railroad carriers of the United States, entered into certain agreements with the United States Government on the subject of fares and allowances for the transportation of military traffic, including among others the following:

“Western Military Arrangement (Army), effective January 1, 1915, executed on behalf of the carriers, including the plaintiff, by their duly authorized agents, and on behalf of the United States by the Quartermaster General of the Army;

“Kevised Western Military Arrangement, effective July' 1, 1916, executed on behalf of the respective parties thereto by the same representatives above mentioned;

“ Interterritorial Military Arrangement 1, effective January 1, 1917, executed December 28,1916, by the above-mentioned Government officers on behalf of the United States, and by the duly authorized agents thereof on behalf of the carriers.”

All of the said agreements, which were in effect during the periods hereinafter referred to, contained certain provisions relative to the construction of net fares and allowances and the use of party fares in the transportation of military passengers.

The said Western Military Arrangement (Army), effective January 1, 1915, contained among others the following provisions:

*89(8) Party fares (where authorized) apply for parties traveling together on one party ticket.

v

“(16) The concessions in fares afforded by this agreement (supplements thereto or reissues thereof), as a whole, are made a condition precedent to:

“(a) The observance of the fares authorized herein, regardless of possible lower combinations, until such fares automatically change with the commercial fares upon which they are based;

“ (b) The nonuse of two or more Government transportation requests for the purpose of reducing the fares authorized herein;

“(c) The nonuse of mixed fares (like a combination of party fares and individual fares) in the construction of through net fares, except that if such combinations exist through important terminals or commercial centers, before the same ai’e used by the accounting officers of the Government in settling accounts, the administrative officers of the Government shall submit such cases to the interested lines through E. L. Bevington, chairman of committee, for adjustment, any decision reached to apply retroactively to any particular movements as to which attention may have thus been called; should the carriers decide adversely, the Government shall then have the right to use two transportation requests in such specific cases in future.”

The said Revised Western Military Arrangement, dated April 1, 1916, effective July 1, 1916, on the same subject, provided as follows:

“(9) Party fares (where authorized) apply for parties traveling together on one party ticket.

“(a) Party fares may be used as factors in constructing-through net fares to and from central trunk line, southeastern, and New England territories, in the understanding that the basing points shall be Chicago, St. Louis, Memphis, Vicksburg, and New Orleans only. Neither two or more party fares, nor a party fare and an individual fare, east or west of the gateways named, may be combined in establishing a basing fare to or from the basing point. Party fares used to and from basing points named must be authorized as one through party fare to or from such basing points, as the case may be. A party fare or an individual fare, published as one through fare to- or from the basing points named, may, however, be combined with authorized individual fares east or west of such points in making through *90net fai’es between the eastern and western territories described except that where through fares of like class are published they shall be used in ■ all cases in establishing through net fares. All fares used in establishing net fares must be lawfully on file with the Interstate Commerce Commission.

“(b) In the construction of net military fares having origin and destination within the territory west of and including Chicago, St. Louis, Memphis, Vicksburg, and New Orleans, party fares to or from St. Louis and Kansas City only may be combined with party fares to and from those gateways only, and party fares to and from St. Louis to and from those gateways only. Two or more party fares, nor a party fare and an individual fare, on either side of St. Louis and Kansas City, may not be combined in establishing the basing fare to or from St. Louis or Kansas City.

“(c) Net fares established on combinations made under sections (a) and (b) apply via usual one-way ticketing routes carrying short line fares or via routes specifically equalizing net fares so made, but shall be restricted to usually traveled routes for military traffic from starting-point to destination.

“(d) Where party fares are used in the territories and upon the bases outlined in sections (a) and (b) herein, the same shall be cashed in the usual way via rate-making gateway, but where such fares are used for any part of the distance in the territory west of Chicago, St. Louis, Memphis, Vicksburg, and New Orleans, under sections (a) and (b) herein, the five per cent allowance to the Government shall not apply to any part of the through fare or proportion, either party or individual fare factors, so far as western carriers are concerned.

“(e) The intent of this agreement is that where through fares are published no combination of fares whatsoever are to be made, except as specified in sections (a) and (b) herein.”

The said Interterritorial Military Arrangement, dated December 28, 1916, effective January 1, 1917, contained the following provisions:

“ For military traffic moving from territory east of Chicago, St. Louis, Memphis, Vicksburg, and New Orleans to territoiy west thereof, or vice versa, authorized party fares to and from the gateways named may be used in the construction of through net fares, in the understanding that the basing points will be Chicago, St. Louis, Memphis, Vicksburg, and New Orleans only.

*91“ Neither two or more party fares, nor a party fare and an individual fare, east or west of the gateways named, may be combined in establishing a basing fare to or from the basing point. Any party fare used to or from the basing points named must be authorized as one through party fare to or from such basing points, as the case may be. A party fare or an individual fare published as one through fare to or from the basing points named may, however, be combined with authorized individual fares east or west of such points in making through net fares between the eastern and western territories described, except that where through fares of like class are published, they shall be used in all cases in establishing through net fares; all fares used in establishing net fares must be lawfully on file with tire Interstate Commerce Commission."

At different times during the years 1915, 1916, and 1917 the plaintiff carried large numbers of persons for the United States over its own lines and those of its connecting carriers upon transportation requests properly issued by officers and agents of the Government. The details of such transportation are set out in Appendix A to the plaintiff’s petition, which is made part of this finding by reference thereto.

IY. Transportation charges for said services were computed by the plaintiff on its bills rendered to the Government numbered WD-564, R-4, WDR-34, WD-64, WDR-75, WDR-93, WDR-156, and WDR-191 on the basis of party fares to Kansas City plus individual fares to destination, net cashed, aggregating $4,055.83, and the accounts were settled on that basis by the accounting officers, and payment therefor was accepted by the plaintiff on that basis without protest or objection. Bill WDR-564, computed by plaintiff at $412.09, for services performed in August, 1915, had the words “ accepted under protest ” stamped upon its face when submitted to the accounting officers. The amount of said bill (WDR-564), at the net per capita rate for individual fares on plaintiff’s road in force at that time, from point of departure to destination, would have amounted to $566.16, a difference of $154.07. All the services charged for in said bills were performed between some time in August, 1915, and May, 1916.

Y. Transportation charges for said services were computed by the plaintiff in its bills rendered to the Government num*92bered R-321, R-352, E-480, E-481, WD-314, R-669J, and one unnumbered bill on the basis of its lawfully published tariff fares, less proper land-grant deductions, and a further deduction of 5 per cent provided for by the terms of the Military Arrangements referred to in Finding II. The plaintiff also gave effect in computing the charges in said bills to the provisions of said Military Arrangements authorizing the use of party fares through certain specified gateways. The bills submitted as aforesaid aggregated $68,419.24. The accounting and disbursing officers in the settlement of said bills made certain disallowances and deductions aggregating $6,908.38 by using combinations of party fares and of party fares and individual fares not authorized by said Military Arrangements and not available to the general public, and paid the balance, $61,510.86, to said railroad company. The said services charged for in said bills were performed after July 1, 1916, and in accordance with the decision of the comptroller in the case of the Chicago, Milwaukee & St. Paul Railway Co., reported in 24 Comptroller’s Decisions at page 663.

MEMORANDUM

by the court.

There is a question raised under Finding IV growing out of the facts that plaintiff rendered bills to the disbursing officers and was paid therefor the amounts shown by the bills rendered; that at the time of payment there had been no decision of the comptroller as to whether or not the basis of party fares plus individual fares could be used; and it appears that one of the bills, aggregating $412.09, had the words “ accepted under protest ” stamped upon its face when submitted to the accounting officers. The significance of this statement is not apparent. However, without deciding the question, it clearly-appears that the service was rendered in August, *1915,*and the suit was not brought until September, 1921, and that, therefore, that item is barred by the statute of limitations.

Judgment for plaintiff in the sum of $6,908.38.

See *Atchison, Topeka & Santa Fe Ry Co.*v. *United States,*256 U. S. 205.