#### WABASH RAILWAY COMPANY v. THE UNITED STATES

[No. C-74.

Decided March 3, 1924]

*On the Proofs*

*Statute of limitations; payment by disbursing officer; deduction from other bills.*— Where a railroad company presents its bills for transportation and they are paid by the disbursing officer, and on account of such payments erroneous deductions are made from other bills of said company presented for payment, the statute of limitations does not begin to run until such deductions are made.

*323*The Reporter's*statement of the case:

*Mr. F. Carter Pope*for the plaintiff. *Mr. William E. Linden*was on the briefs.

*Mr. Joseph H.*Sheppard, with whom was *Mr. Assistant Attorney General Robert II.*Lovett, for the defendant. *Mr. George H. Foster*was on the briefs.

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

I. The plaintiff is a corporation duly incorporated under the laws of the State of Indiana, and during the times of the different transactions hereinafter set forth in these findings of fact operated, and still operates, a line of railways in the State of Indiana and other States, doing a business as a common carrier of passengers and freight for hire and reward under tariffs issued by it and its connecting carriers with its concurrence, and duty published and filed with the Interstate Commerce Commission as required by law.

II. Prior to the dates of the transportation which constitutes the subject of this suit the plaintiff and other railroads of the United States entered into agreements with the Government concerning fares and allowances for the transportation of United States troops and property. The said agreements were designated as inter territorial military arrangements, western military arrangements, etc. The said agreements were executed on behalf of the carriers by the duty authorized agents of the Southwestern, the Transcontinental, the Western, the Central, the New England, and the Southeastern Passenger Associations, and the Trunk Line Association, and on behalf of the United States by the Quartermaster General of the Army, the Chief of the Bureau of Navigation of the Navy, and the quartermaster of the Marine Corps. The said military agreements were in full force and effect as late as May 20,1920, and their provisions have been observed by the carriers generally. Under the terms of said agreements the Government has paid for transportation at rates substantially five per centum less than it would otherwise -have paid.

*324III. One of the said agreements, designated western military arrangement, dated April 1, 1916, effective July 1, 1916, contained the following provisions:

“(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, *trvmh TAne, southeast*ern., *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 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 the Interstate Commerce Commission.

*“(b)*In the construction of net military fares having-origin and destination *within the territory west of amd 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.

*“(g)*Net fares established in 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 (&) herein, the same shall be net cashed in the usual way via rate-making gateway only, 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)**325and *(b)*herein, the five per cent alloAvance to the Government shall not apply to any part of the through fare or proportion, either party or individual fare factor, so far as western carriers are concerned.

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

IY. At various times during the year 1916, subsequent to June 30, 1916, plaintiff, acting upon transportation requests issued by the duly authorized agents and officers of the United States, transported large numbers of persons for the United States Government on plaintiff’s own lines and in connection with plaintiff’s connecting carriers. In rendering bills for such transportation plaintiff computed the charges thereof on the basis of the lawfully published tariff rates as modified or otherwise affected by the terms and provisions of the above-mentioned military agreements. Notwithstanding the said tariff rates and provisions, and the terms of the said military agreements, the Government accounting officers constructed through fares by using two or more party fares, or party fares and individual fares, or other combinations thereof over intermediate points, other than those specified in the agreement.

V. At the instance and request of duly authorized officers of the United States Army, plaintiff furnished transportation to the United States Army as follows: •

Date ! TA'QU. JJate ^ w q 1916 July e July a From— 34911 34922 Springfield, Ill. Springfield, Ill. To-No. of passgrs. Brownsville, Tex__ San Antonio, Tex. 1,201 1,126

For said transportation plaintiff, under the tariffs then in effect and under said military agreements, was entitled to be paid the net cash per capita rate of $25.20 on the movement from Springfield to Brownsville and the net cash per capita rate of $18.37 on the movement from Springfield to San Antonio, and for such sums rendered its bill S-394 to the disbursing quartermaster of the United States Army, who *326paid the same as rendered by voucher No. 238 of Major Robert Field for May, 1917. Subsequently upon an examination of the disbursing officer’s account the aforesaid payment was suspended by the Auditor for the War Department on the ground that notwithstanding said military agreements against the construction of fares for through sendee by combinations of intermediate fares involving the use of party fares with individual fares, the Government was entitled to make through rates by such combinations and over points not specified in said agreements, and he caused demand to be made upon plaintiff for the refund of the sum of $7,663.56, the difference between the amounts paid and the 'amounts due on the basis of the combinations made by the auditor. Plaintiff refused to make said refund and thereupon the disbursing quartermaster at Washington arbitrarily deducted said sum of $7,663.56 from plaintiff’s subsequent bill No. S-1046 for passenger service rendered in August, 1917, and said bill S-1064 as so reduced was paid by Captain R. G. Wood’s voucher No. 5500-T of March, 1918. When notified by the zone finance office at Washington that said account No. S-1064 had been passed for payment in the reduced amount, plaintiff, by letter dated January 18, 1918, notified said zone finance office that the quartermaster’s warrant in settlement of said bill for the reduced amount when received would be accepted under protest subject to further settlement, and at the same time plaintiff rendered to the zone finance office its supplemental bill (S-394) for the amount of said deduction. The zone finance office on February 12, 1918, returned said supplemental bill with the statement that the deduction from account S-1064 had been made in accordance with instructions by the Auditor for the War Department and that it would be necessary for any further correspondence to be had with the auditor. Thereupon on April 9,1918, plaintiff forwarded said supplemental bill to the auditor with a statement of the previous correspondence with the zone finance office. The Auditor for the War Department by his certificate No. 34611, dated October 9, 1918, disallowed said supplemental bill in full, “ for the following-named reasons, viz:

*327“ Under the dec. of the Compt, of the Treas., dated May 10, 1918, if a through fare can be established by a combination of individual and party fares over junction points not authorized by the interterritorial military arrangements which is lower than any combination that can be established over junction and under terms authorized by said agreement, the Government is entitled to the lower fare providing the benefit of the 5% allowance is waived.”

YI. The charges in plaintiff’s corporate bill S-1064 were correct and proper as stated therein, and no objection to said charges was made by either the disbursing or accounting officers. The deduction of $7,663.56 was made by direction of the auditor, on account of an alleged overpayment of plaintiff’s bill S-394, which has been paid in full by said disbursing officer. The balance of bill S-1064 was paid to plaintiff in March, 1918, and received by it under protest.

Cambbelu, *Chief*Justice,

delivered the- opinion of the court:

The facts show that plaintiff, having rendered certain transportation service, presented its bills therefor and was paid by a disbursing- officer. Afterwards the disbursing officer’s accounts were checked by the auditor, who held that the disbursing officer had paid more than he should have paid, and consequently his accounts were disallowed to that extent. The amount of these overpayments was deducted from other proper bills of plaintiff. The services for which the first bills were presented occurred in 1916, more than six years before the present action was brought, and' the deduction from subsequent bills were made in 1917 or after-wards. The facts do not show definitely the dates of these subsequent deductions, but do show that the service for which the subsequent bills were rendered were as late as August, 1917, At any rate, the deductions were made within six years prior to the beginning of this suit. Plainly the plaintiff’s cause of action did not arise until deductions were made from its subsequent bills. Its prior bills had been paid in full. Properly speaking, its right of action is upon or because of these deductions, and this is not barred by the statute of six years, the suit having been duly instituted within that time. We have lately had occasion to point out *328tliat the statute of limitations prescribed by the transportation act, 41 Stat. 492, does not begin to run against claims which arose before its enactment until the date of the passage of the act. See *Sohn*v. *Waterson,*17 Wall. 596; *Schaff, Receiver of M., K. & T. Ry. Co. of*Texas, decided this day, ante, p. 318. We think the deductions were not upon the piKvper basis. See Atchison, *Topeka & Santa Fe R. R. Co.,*256 U. S. 205; *International & Great Northern*Ry., 56 C. Cls. 336. The plaintiff is entitled to judgment in the sum of $7,663.56, and it is so ordered.

Graham, *Judge;*Hay, *Judge;*DowNey, *Judge;*and Booth, Judge, concur.