Opinion ID: 464954
Heading Depth: 1
Heading Rank: 1

Heading: household goods individual rate tenders

Text: 2 In prior years, Defense accepted from carriers interstate rates (for carriage of household goods) that had been collectively formulated by rate bureaus and comparable entities. Effective in 1984, the department cancelled this practice and adopted new regulations (and implementing practices) requiring individual tenders by the individual carriers. No. 84-5836, in a suit brought against the Government by some collective rate-making bureaus and several individual motor carriers, challenges these new regulations as contrary to that portion of the Interstate Commerce Act dealing with motor carriers, a statute which expressly authorizes collective rate-making. The issue being purely legal, both sides moved for summary judgment. The district court granted defendant-appellees' motion, denied appellants', and dismissed the action. 3 The short answer to this appeal is that, though the Interstate Commerce Act does authorize collective rate-making (and partially immunizes from anti-trust liability those carriers participating in such joint activity), there is nothing in that legislation that demands that Government procuring agencies accept such collectively made rate tenders. On the contrary, in 49 U.S.C. Sec. 10721(b)(1) (formerly the well-known Section 22 of the Interstate Commerce Act) individual carriers are expressly authorized to transport property for the Government at reduced rates. 1 This specific provision demonstrates that the Government is free to contract with common carriers on its own terms and has the right to make its own arrangements. Howe v. Allied Van Lines, 622 F.2d 1147, 1154-55 (3d Cir.), cert. denied, 449 U.S. 992, 101 S.Ct. 528, 66 L.Ed.2d 289 (1980). See also United Services Automobile Ass'n v. Paul Arpin Van Lines, 652 F.2d 198, 200-01 (1st Cir.1981). The Government is not bound by practices ordained for wholly private transactions. Conversely, individual carriers have the statutory right to deal directly with the Government. See 49 U.S.C. Sec. 10706(b)(3)(B)(ii) (the [rate bureau] may not interfere with each carrier's right of independent action    ). The provision of Sec. 10721(b)(2) permitting a carrier to quote or tender a [collectively established] rate is not a directive that the Government must accept or consider that rate but simply a declaration that such a filing will not be illegal in itself. In sum, the Interstate Commerce Act allows the Government, if it wishes, to accept rate-bureau rates, but also permits the Government to reject those rates and to treat directly with individual carriers. 4 Nor is there anything in the Armed Services Procurement Act mandating that the Government can solicit only collectively determined rates. On the contrary, that statute declares that Defense procurement shall be awarded on a competitive bid basis to the lowest responsible bidder, in all cases in which the use of such method is feasible and practicable under the existing conditions and circumstances, 10 U.S.C. Sec. 2304(a), and that the contract should be awarded to the responsible bidder whose bid will be the most advantageous to the United States, price and other factors considered. 10 U.S.C. Sec. 2305(c). Far from requiring the use of rate bureau tenders, the Procurement Act stresses individual competition. 5 In the light of this statutory framework--the Interstate Commerce Act and the Armed Services Procurement Act 2 --it is impossible to consider the new regulation to be arbitrary or capricious. The Department of Defense merely seeks the advantages of the individual competition that Congress has specifically envisaged. In the field of procurement, in which the United States enjoys the broadest powers (Perkins v. Lukens Steel Co., 310 U.S. 113, 127, 60 S.Ct. 869, 876, 84 L.Ed. 1108 (1940)), that cannot be an improper objective.