Case: JET FORWARDING, INC. v. THE UNITED STATES
Abbreviation: Jet Forwarding, Inc. v. United States
Decision Date: 1971-02-19
Docket Number: No. 196-67
Citation: 194 Ct. Cl. 343
Volume: 194
Reporter: United States Court of Claims Reports
Court: United States Court of Claims
Jurisdiction: United States
Parties: JET FORWARDING, INC. v. THE UNITED STATES
Judges: Before Cowen, Chief Judge, Laramoke, Burpee, Davis, ColliNS, Skelton, and Nichols, Judges.
Pages: 343–369

Head Matter:
437 F. 2d 987
JET FORWARDING, INC. v. THE UNITED STATES
[No. 196-67.
Decided February 19, 1971.
Plaintiff’s motion for reconsideration arid rebearing denied May 14, 1971]
Alani F. Wohlstetter, attorney of record, for plaintiff. Derming & Wohlstetter and Stcmley I. Goldman, of counsel.
George M. Beasley, III, with whom was Assistant Attorney General L. Patrick Gray, III, for defendant.
Before Cowen, Chief Judge, Laramoke, Burpee, Davis, ColliNS, Skelton, and Nichols, Judges.

Opinion:
Per Curiam:
This case was referred to Trial Commissioner Roald A. Hogenson with directions to mate findings of fact and recommendation for conclusions of law under the order of reference and Rule 134(h). The commissioner has done so in an opinion and report filed on March 19, 1970. Exceptions to the commissioner's opinion, findings and recommended conclusion of law were filed by plaintiff. Defendant excepted to Finding 28 hut otherwise urged the court to adopt the commissioner's opinion, finding and recommended conclusion of law. The case has been submitted to the court on the briefs of the parties and oral argument of counsel. At oral argument the plaintiff abandoned its contention that the volume rate should govern and limited its claim to the application of the alternative 500-lb. rate.
The main issue in this case turns on the particular course of dealings between plaintiff's general (and authorized) agent in Japan and the defendant's transportation representatives there. The agreements on which suit is brought are the bills of lading under which the shipments moved, not the plaintiff's rate tenders. Cf. United States v. Louisville & Nashville R.R., 221 F. 2d 698, 701-02 (6th Cir. 1955). When those individual agreements were made in Japan, the parties contracted in the light, not only of the bare words of the earlier Military Traffic Management and Terminal Service (MTMTS) letters requesting volume tenders and the plaintiff's tenders in response, but also, and significantly, in the light of the actual practice and understandings at the two air bases in implementing those tenders. The individual contracts thus made have been properly interpreted by the trial commissioner — with the help of the principle that contemporane ous construction by the parties must be given great weight, and also of the rule that a party knowing the meaning his opposite number gives to an agreement about to be consummated is bound by that understanding unless he speaks up— as having a different meaning from the usual or normal volume rate agreement. In this respect, this case differs markedly from Container Transport Int'l, Inc. v. United States, ante, at 320, 437 F. 2d 1365, likewise decided this day, in which no such special understandings and course of dealings were shown, and the individual shipping agreements were therefore interpreted according to the normal reading of the defendant's request for a volume rate and the carrier's volume tender.
Since the court agrees with the trial commissioner's opinion, findings and recommended conclusion of law, as hereinafter set forth, it hereby adopts the same, together with the foregoing paragraph, as the basis for its judgment in this case. Therefore, plaintiff is not entitled to recover and its petition as amended is dismissed. Defendant is entitled to recover on its counterclaim and judgment is entered for defendant thereon in the sum of $9,406.33.
OPINION OP COMMISSIONER
Hogenson, Oommissioner: As the carrier with the lowest volume rate tendered to defendant on each of the subject mass movements, plaintiff was utilized by defendant to accomplish a mass movement of household goods of members of the Air Force from Misawa Air Base, Japan, to Eglin Air Force Base, Florida, and also such a movement from Yokota Air Base, Japan, to the same Florida installation.
In accordance with defendant's established program with respect to movement of such household goods, plaintiff provided to defendant door-to-door container service, which involved the prepacking and loading of the household goods of an individual member of the Air Force into specially designed containers at the origin residence of the member, transportation of the loaded containers to the port of departure, arrangement for movement via ocean vessels, trans portation. of tbe loaded containers beyond the port of discharge to the destination residence of the member, and placing the household goods in the new residence.
The mass movements from Misawa and Yokota occurred in the period from April 25 through July 15, 1965. During that period, defendant's transportation officers there prepared and issued 226 bills of lading covering the shipments.
Most of the 226 bills of lading were issued to cover the household goods of only one Air Force member. However, 30 of them covered the household goods of two or more members, varying from 2 to 7. The total weight of household goods on each bill of lading varied from 366 to 11,927 pounds, except that for one bill of lading, the weight was 13,402 pounds. The weight of the goods of the individual members ranged from 366 to 6,690 pounds.
After plaintiff had accomplished the delivery of the shipments, plaintiff billed and defendant paid on the basis of application of the pertinent volume rate ($28.90 per cwt. for Misawa, or $26.80 per cwt. for Yokota) to the actual weight set forth on each bill of lading. For example, one bill of lading covered an aggregate of 6,745 pounds of household goods of 4 Air Force members, and plaintiff billed at its Misawa volume rate of $28.90 per cwt., applied to 6,745 pounds, for charges on that bill of lading of $1,949.31.
In this manner, and aside from accessorial services, plaintiff originally billed and was paid $166,197.53 on the pertinent shipments, insofar as 225 bills of lading were concerned.
Subsequently, in the period from July 27 through November 30, 1965, plaintiff submitted supplemental billings to defendant on each of the 225 bills of lading, applying the pertinent volume rate ($28.90 per cwt. for Misawa, or $26.80 per cwt. for Yokota) to 12,000 pounds for each bill of lading, irrespective of the lesser weight involved on each of them. Of course, this change of method of computation had no effect on the bill of lading covering 13,402 pounds, as plaintiff had billed on the actual weight of that shipment, and plaintiff submitted no supplemental billing thereon. For an example of the supplemental billings, adverting to the above-mentioned bill of lading involving 6,745 pounds, plaintiff's supplemental billing was at the $28.90 per cwt. rate, applied to 12,000 pounds, for claimed charges on that bill of lading of $3,468, or an increase of $1,518.69 from the $1,949.31 previously billed and paid.
In this manner, aside from accessorial services, plaintiff computed the pertinent transportation charges in its supplemental billings on the 225 bills of lading in the sum of $733,428, an increase of $567,230.47 over the amount previously billed and paid.
Defendant has refused to pay these supplemental billings.
On the basis that the correct computation of charges is the maimer used by plaintiff in its supplemental billings, as contended by plaintiff but disputed by defendant, the parties agree that the amount of plaintiff's recovery would be $567,230.47, the amount sought by plaintiff in its petition as amended at the pretrial conference herein. If otherwise recoverable, such sum is subject to reduction by setoff of part or all of the $9,406.33 sought by defendant in its counterclaim, to the extent such counterclaim is sustained.
Defendant's basic position, with an alternative contention later discussed, is that plaintiff's method of computation of charges in its original billings was the correct way, aside from charges for accessorial services.
The counterclaimed amount of $9,406.33 includes three-items: (1) The sum of $128.42, which the parties agree defendant is entitled to recover on its counterclaim, by setoff or otherwise, irrespective of the disposition of other issues in the case; (2) the sum of $555.09, which concerns the issue of the proper charges for returning the property of Airman First Class Cleland from storage in Pensacola, Florida, to Misawa Air Base, Japan, and which sum the parties agree is the correct amount of recovery by defendant, if defendant's method of computation of such charges is sustained; and (3) the sum of $8,722.82, which plaintiff included in its original billings and was paid, as additional charges over and above its volume rate computations, for accessorial services performed on the pertinent shipments, and which sum the parties agree would be the correct amount of recovery by defendant on its counterclaim, provided defendant's position, contested by plaintiff, is sustained that the acces-sorial services were not additional to, but included within, those to be provided pursuant to plaintiff's volume rate tenders for the pertinent volume rates.
With respect to the issue concerning accessorial charges, the parties agree that the sum of $8,722.82 is not recoverable by defendant, if defendant's alternative theory disputed by plaintiff is sustained that the applicable rate in this case is $36.90 per cwt., subject to a 500-pound minimum weight per shipment. However, the parties agree that such sum iá recoverable by defendant if the pertinent volume rates are applicable, either as interpreted by plaintiff or by defendant, provided defendant's position is sustained on the inclusion of the accessorial services in the pertinent volume rates.
Defendant's alternative position on the issues raised by plaintiff's petition as amended is that if the volume rates are applicable under plaintiff's theory, then defendant is entitled to the lesser charges which would result from application of plaintiff's rate of $36.90 per cwt., with a minimum weight of 500 pounds, applied to the actual weight of each bill of lading, except to 500 pounds on any bill of lading involving less than such minimum weight. This rate plaintiff had previously filed with defendant, and defendant contends that it remained available to defendant throughout the mass movements involved in this case. If such is the applicable rate, the parties agree that plaintiff would be due the sum of $57,324.06 as additional charges on the pertinent shipments, subject to application of any valid set off.
It is my opinion that plaintiff is not entitled to recover, that its petition as amended should be dismissed, that defendant is entitled to recover the sum of $9,406.33 on all three items of its counterclaim, and that judgment should be entered for defendant on its counterclaim in that amount.
By separate letters, dated March 31 and April 7, 1965, the Military Traffic Management and Terminal Service (MTMTS) of the Department of Defense wrote to all household goods carriers authorized to provide service between Japan and the Continental United States (including plaintiff) concerning the two mass movements of household goods involved in this case. It was stated that the movement from Misawa would be about 311,900 pounds, and from Yokota about 502,200 pounds of household goods, with the former to occur from April 15 through June 15, 1965, and the latter from May 1 through July 1, 1965. Each carrier was requested as to each of such volume movements to
consider offering this Service a single factor transportation rate per net cwt. based on the 12,000 pound minimum weight, which would be a deviation from your present rate and which you consider compensatory and reasonable under the circumstances of this volume movement.
Within the times allowed, plaintiff and other carriers submitted their quotations in response to such solicitations. Plaintiff submitted the lowest volume rate on each movement, and was the carrier utilized by defendant thereon.
Plaintiff's submitted rate on the Misawa movement was $28.90 per cwt. with a "12,000 pound minimum," and on the Yokota movement, $26.80 per cwt. with a "12,000 pound minimum."
Within the 82-day period during which the actual mass movements from the Misawa and Yokota installations occurred, plaintiff removed therefrom (and in due time delivered to the Florida destination) a total weight of about 622,000 pounds of household goods. Involved were the individual shipments of household goods of 311 members of the Air Force. Thus, the weight of individual shipments averaged about 2,000 pounds per member, which was an average weight reasonably within the contemplation of MTMTS and plaintiff at the time of the MTMTS solicitation and plaintiff's submission of its volume rates.
Plaintiff's general agent in Japan was Thru-Container Services, Inc., and Thru-Container arranged to have plaintiff's local agent at Misawa, and also plaintiff's local agent at Yokota, pack the household goods of a transferring member of the Air Force into containers and remove the same from the pertinent air base for transportation to an ocean port.
The ocean ports utilized were Yokohama for the Yokota shipments and Hachinohe for the Misawa shipments, with the land transportation distances involved being respectively 35 and 15 miles. Awaiting ocean transportation, Thru-Container consolidated the shipments in a warehouse at each port, and the shipments were carried on three vessels to Pensacola, Florida.
Prior to the start of either of the mass movements, defendant's Traffic Management Officer at each base was advised by MTMTS that plaintiff had submitted the lowest volume rate, and each was supplied with a copy of plaintiff's volume rate tender and copies of the tenders of higher rates by other carriers on the pertinent mass movement.
To meet the 12,000-pound minimum weight requirement of the pertinent volume rate, the Traffic Management Office at each base planned to use and did use a different method of cross-referencing of bills of lading.
The method employed at Misawa is exemplified by two successive bills of lading issued May 12 and 13, 1965, covering respectively 5,269 and 7,782 pounds of household goods, or a total of 13,051 pounds. It was stated on the first of these two bills of lading that the 5,269 pounds covered a portion of a volume tender shipment, and on the second, that the 7,782 pounds were the remainder of the volume shipment initiated by the first bill of lading, stating the number of the prior bill.
The cross-referencing at Yokota was accomplished by grouping together ten successive shipments, aggregating in excess of 12,000 pounds, and by noting on the reverse side of each of the ten bills of lading, under the heading, Special Services Ordered, that each shipment was consolidated with the other nine shipments, with the numbers of the ten successive bills of lading noted.
The authority for cross-referencing of bills of lading in mass movements of household goods is contained in paragraph 16 of the regulations of the Defense Supply Agency, DSAE 4500.1, effective at all times relevant in this case, which provided in pertinent part as follows:
(a) Transportation officers making volume (mass) movements of household goods (as defined in par. XVII, DSAB 4500.1) will issue a separate Government bill of lading for each, member's goods (each lot). Each, bill of lading covering a portion of the volume (mass) movement will be appropriately cross-referenced in the "Special Services Ordered" space on the reverse of the bill of lading as follows:
1. First bill of lading issued to cover a portion of the volume movement tendered carrier (date) comprising approximately-- — ,— pounds.
2. Second (and succeeding) bill of lading issued to cover a portion of the volume (mass) movement tendered carrier_(date)_comprising approximately _,_, pounds, the first portion (s) of which moved on bill (s) of lading No.(s) (symbol, serial number (s), and date(s)).
3. Final bill of lading issued to cover the remainder of the volume (mass) movement tendered carrier _(date)_comprising_pounds, the first portion of which moved on bills of lading Nos. (symbol, serial numbers, and dates').
(b) When consolidation of two or more shipments will result in the application of a volume rate, i.e., 8,000#, 12,000#, etc., transportation officers will issue a separate Government bill of lading for each member's goods (each lot) and identify each bill of lading in the "Special Services Ordered" space on the reverse of the bill of lading as follows: "This is a consolidated shipment comprised of bills of lading Nos. (symbol and serial numbers)
The Traffic Management Office at Misawa relied upon the provisions of paragraph (a) above, whereas at Yokota, paragraph (b) was considered applicable.
Prior to the start of each of the subject mass movements, the manager of Thru-Container conferred with defendant's Traffic Management Officer at each of the bases concerning defendant's method of processing shipments of household goods to be used on each mass movement. Each Traffic Management Officer explained to Thru-Container his method of cross-referencing bills of lading to meet the 12,000-pound minimum weight requirement of plaintiff's volume rate.
In the discussion at each base, both Thru-Container and each Traffic Management Officer understood that plaintiff would he utilized as the sole carrier on each of the subject mass movements, and both knew, and it was discussed, that plaintiff's packing capability was limited at each base, with one local agent available at each location.
The established procedures, as explained to Thru-Container and applied on the pertinent mass movements, were that when a member of the Air Force came to the Traffic Management Office, with his orders concerning his transfer to Eglin Air Force Base, Florida, a date was set for the packing and pickup of that member's household goods, usually I days later, but sometimes sooner.
The Traffic Management Office then promptly notified Thru-Container, or the local agent, of the scheduled pickup of that member's household goods, either by telephone or by direct contact with a representative at the base. Thru-Container would then conduct a presurvey, or inspection of the pertinent household goods, to determine the requirements for the particular shipment. The bill of lading was issued prior to the pickup date, but usually after the presurvey had been conducted. Before the removal of the shipment from the base, an entry was made on the bill of lading, showing the weight of the shipment.
The pickup of the individual shipments occurred over the entire period of the mass movements, and each of the local agents was fully occupied on the pertinent mass movement.
The manager of Thru-Container frequently complained to defendant's Traffic Management Officer that plaintiff's packing capability at Misawa was so short that defendant should space out the shipments so that they could be more easily handled.
Except for the one bill of lading covering 18,402 pounds, concerning which plaintiff presents no claim, defendant did not offer to plaintiff at any one time on either of the subject mass movements, 12,000 or more pounds of household goods.
Under the heading of Tariff or Special Eate Authorities, each bill of lading was annotated by the appropriate Traffic Management Office, to show that the shipment was moving under the pertinent volume rate.
Plaintiff, by its authorized agent, Thru-Container, was fully aware of the methods employed by defendant in its efforts to take advantage of the pertinent volume rates, and was aware of the intended use of such methods prior to the start of subject mass movements.
At no time, throughout the subject mass movements, or prior thereto, did Thru-Container object to defendant's procedures, or to defendant's interpretation of the meaning of a tender of a minimum of 12,000 pounds of household goods under the provisions of the pertinent volume rate quotations.
It has been held that an essential element in the application of a volume rate is the requirement that a shipper tender the specified minimum weight of the commodity to the carrier at one time to be shipped from one origin to one destination. Baggett Transportation Co. v. United States, 162 Ct. Cl. 570, 584-586, 319 F. 2d 864 (1963); Hughes Transportation, Inc. v. United States, 169 Ct. Cl. 63, 68 (1965).
However, this rule is not reasonably applicable to the facts and circumstances of this case. It is axiomatic that defendant is exempt from the statutory provisions prohibiting discriminatory rates as between different shippers, and whether or not defendant is using a carrier otherwise subject to such restrictions, its agreements concerning freight rates are subject to interpretation in the light of rules of contract construction seeking the true intent of the parties to the agreement. The meaning of the terms "12,000 pound minimum" is not to be resolved in this case on the basis of a technical rule of law, but rather by facts and circumstances which show what plaintiff and defendant truly meant in the use of such terms.
Both parties intended from the outset that plaintiff would be utilized as the sole carrier on the transportation of the large quantities of household goods involved on each of the subject mass movements. Plaintiff in subject case was not required to share with other qualified carriers the available shipments at the origin installations. Plaintiff knew that it would be offered, and in fact it was offered, all of the mass movement shipments which it was capable of handling, and all within an 82-day period of time. Plaintiff's agents did not object to defendant's interpretation of the terms "12,000 pound minimum," explained to them prior to the start of each of the mass movements. By their conduct throughout the mass movements, they showed their concurrence with defendant's interpretation. At Misawa, plaintiff's agent repeatedly urged defendant to spread out the shipments, as defendant consistently endeavored to do.
Prior to any dispute being raised concerning the failure of defendant to offer a minimum of 12,000 pounds of household goods at a time, the parties by their conduct and statements clearly showed that they were in agreement with respect to the meaning of the terms "12,000 pound minimum," and plaintiff is not entitled to the application of a technical rule of transportation law to the contrary.
It is held that the proper method of computing the transportation charges in this case, aside from those relating to accessorial services, was that used by plaintiff in its original billings, and that plaintiff is not entitled to recover on its petition as amended.
Thus computed, the transportation charges are less than they would be if defendant's alternative position were sustained, and it is unnecessary to decide the issues relating to that theory.
The remaining issues concern the validity of the $555.09 and $8,722.82 items of defendant's counterclaim.
While technically pleaded as items of counterclaim, each of these claimed overpayments of transportation charges falls within the rule of United States v. New York, N. H. & H. R. R., 355 U.S. 253 (1957), that the statutory law requiring defendant to pay transportation charges as billed by the carrier, subject to recoupment of overcharges on subsequent audit by the General Accounting Office, leaves the burden of proof on the carrier to establish the correctness of its transportation charges billed and paid, when disputed on subsequent audit. It was held that the carriers were to be paid promptly upon submission of their bills, that the car riers were to refund overcharges when they were administratively determined, that it was the intent of Congress in enacting the prompt payment law that the Government's protection against overcharges was not diminished, and that the carrier had the burden of proof on the issues concerning the correctness of the claimed overcharges, after the General Accounting Office had recouped the same by deductions from subsequent bills otherwise payable to the same carrier.
Of course, there was no recoupment of any amount of the two disputed overcharges in this case, either in the post-audit procedures of the General Accounting Office, or otherwise. These claimed overcharges first arose during the pendency of this suit and in the course of the GAO audit of plaintiff's claims pursuant to the rules of this court. However, it is held that the correctness of plaintiff's charges on the pertinent billings, paid promptly in accordance with the prevailing statute, remain open to contest, and that plaintiff has the burden of proof on the two disputed items of claimed overcharges.
While plaintiff contests the validity of defendant's computation of the proper charges on the transportation of the household goods of Airman First Class Cleland from storage in Pensacola, Florida, to Misawa Air Base, Japan, plaintiff failed to offer any evidence concerning the existence of the rate upon which it based its billing on that shipment, or any evidence of the existence of any other rate which might have been applicable in lieu of that used by the General Accounting Office. The General Accounting Office determined that plaintiff had been overpaid in the sum of $555.09 on such shipment. Plaintiff failed to sustain its burden of proof as to the correctness of the charges in the amount which it billed and was paid, or as to the correctness of any amount in excess of that determined by the General Accounting Office. This item of the counterclaim is sustained.
As to the correctness of plaintiff's billings of additional charges for accessorial services on subject mass movements, plaintiff's volume rate tenders provided in pertinent part as follows:
16. Accessorial Services. The accessorial services shown below will be furnished by the carrier on request of the shipper at the rates or charges specified in this item, which will be in addition to the rates or charges shown in Items 11 and 12. Such requests must be shown on the bill of lading and initialed by the person requesting same.
The referenced Items 11 and 12 covered the quotation by plaintiff of the respective volume rates per cwt., with the 12,000-pound minimum weight.
Directly below the above-quoted provision concerning accessorial services, and within the appropriate space provided, plaintiff had on each of its tenders the typewritten words "Included in Transportation Bates."
In the absence of any testimony or evidence to the contrary, and without any convincing argument by plaintiff that a contrary meaning should be ascribed to the language of its tender, it is concluded that plaintiff's volume rates covered the accessorial services, that plaintiff incorrectly billed defendant and was paid additional charges for such services, and that defendant is entitled to recover the agreed sum of $8,722.82 on this item of its counterclaim.
Findings oe Fact
1. Plaintiff is a corporation organized and existing under the laws of the State of California, with its principal place of business at 1415 West Torrance Boulevard, Torrance, California.
2. The shipments involved in this suit consist of used household goods transported by plaintiff between points in the United States and points overseas for the Department of Defense in so-called "door-to-door container service." Basically, "door-to-door container service" covers the movement of household goods between points in the United States, on the one hand, and, on the other, points overseas, and involves the prepacking and loading of each shipment into specially designed containers at the origin residence, transportation of the loaded containers to the port of departure, arrangement for movement via ocean vessels, or by air, trans portation of the loaded containers beyond the port of discharge to the destination residence, and placing household goods into the residence.
3. On and before March 1, 1965, plaintiff was offering to provide such services from military installations in J apan to all points in Florida (including Eglin Air Force Base and Homestead Air Force Base) for a single-factor, line-haul rate of $36.90 per cwt. subject to a 500-pound minimum weight per shipment and subject to the terms of Military Basic Tender No. 1, as amended, published by the Household Goods Forwarders Association of America, Inc.
4. By letter dated March 31, 1965, the Military Traffic Management and Terminal Service (MTMTS) of the Department of Defense wrote to all household goods carriers authorized to provide service between the Continental United States and Japan (including plaintiff) concerning a volume movement of household goods from Misawa Air Base, J apan, to Eglin Air Force Base, Florida. The letter stated:
1. You are advised of the subject volume movement of approximately 317,900 pounds of uncrated household goods between the above points. Commuting area at both origin and destination is a 50 mile radius. Movement is scheduled to begin on or about 15 April 1965 and end approximately 15 June 1965. Approximately 317,900 pounds will be subject to storage-m-transit at destination. Controlling officer for the subject volume movement will be the transportation officer at Misawa Air Base, Japan.
2. It is requested that you consider offering this Service a single factor transportation rate per net cwt. based on the 12,000 pound minimum weight, which would be a deviation from your present rate and which you consider compensatory and reasonable under the circumstances of this volume movement. The rate should include loading, unloading, packing, unpacking and the actual movement or transportation of property from origin to destination. The single factor rate will also include appliance servicing and unservicing of articles which have free moving parts, mechanisms, attachments or accessories, which if not properly serviced would be damaged or rendered inoperative during transit. Bequest that you consider extra pickup or delivery charge to be $5.00 per stop or call after the first pickup or additional deliveries after the first delivery. Extra pickup or delivery and other accessorial charges for additional services not provided for above will be provided for in Item 16 of your Tender. The released valuation will be 30 cents per pound per article.
3. Bequest reply in writing to Commander, Military Traffic Management and Terminal Service, Building T-7, ATTN: HGB, Boom 1902, Washington, D.C. 20315, not later than 1630 hours, 9 April 1965. Telephone reply should be directed to Mrs. Cohen, OX_ 77163 or 74459. In event of your favorable determination, seven copies of your rate tender to cover subject movement must be submitted, two of which must be signed. In reply, please refer to file: Volume Movement Misawa AB, Japan to Eglin AFB, Florida, Case 5-1 (1).
5. Plaintiff responded to the above-quoted request of MTMTS, and submitted a rate of $28.90 per cwt. with a "12,000 pound minimum" on household goods moving from Misawa Air Base, Japan to Eglin Air Force Base, Florida. Plaintiff's tender was the lowest received from the carriers solicited.
6. By letter dated April 7, 1965, MTMTS wrote to all household goods carriers authorized to provide service for the Department of Defense between the Continental United States and Japan (including plaintiff) concerning a volume movement of household goods from Yokota Air Base, Japan to Eglin Air Force Base, Florida. The letter stated:
1. You are advised of the subject volume movement of approximately 502,200 pounds of uncrated household goods between the above points. Commuting area at both origin and destination is a 50 mile radius. Movement is scheduled to begin on or about 1 May 1965 and end approximately 1 July 1965. Controlling officer for the subject volume movement will be the transportation officer at Yokota Air Base, Japan.
2. It is requested that you consider offering this Service a single factor transportation rate per net cwt based on the 12,000 pound minimum weight, which would be a deviation from your present rate and which you consider compensatory and reasonable under the circumstances of this volume movement. The rate should include loading, unloading, packing, unpacking and the actual movement or transportation of property from origin to destination. The single factor rate will also include appliance servicing and unservicing of articles which have free moving parts, mechanisms, attachments or accessories, which if not properly serviced would be damaged or rendered inoperative during transit. Bequest that you consider extra pickup or delivery charge to be $5.00 per stop or call after the first pickup or additional deliveries after the first delivery. Extra pickup or delivery and other accessorial charges for additional services not provided for above, will be provided for in Item 16 of your Tender. The released valuation will be 30 cents per pound per article.
3. Bequest reply in writing to Commander, Military Traffic Management and Terminal Service, Building T-7 ATTN: HGB, Boom 1902, Washington, D.C. 20315, not later than 1630 hours, 19 April 1965. Telephone reply should be directed to Mrs. Cohen, OX 7-7163 or 7-4459. In event of your favorable determination, seven copies of your rate tender to cover subject movement must be submitted, two of which must be signed. In reply, please refer to file: Volume Movement Yokota AB, Japan to Eglin AFB, Florida, Case 5-2 (2).
7. Plaintiff responded to the last above-quoted request of MTMTS, and submitted a rate of $26.80 per cwt. with a "12,000 pound minimum" on household goods moving from Yokota Air Base, Japan to Eglin Air Force Base, Florida. Plaintiff's tender was the lowest received from the carriers solicited.
8. Plaintiff extended the authorized period for the volume moves from June 15, 1965, at Misawa and July 1, 1965, at Yokota, until the completion of the moves.
9. Subsequently, during the period April 25,1965, through July 15, 1965, the transportation officers at Misawa and Yokota Air Bases in Japan tendered household goods to plaintiff which moved on 226 Government bills of lading, which household goods were originally destined to Eglin Air Force Base, Florida. All of the 226 Government bills of lading were prepared by defendant's representatives.
10. Most of the 226 bills of lading covered the household goods of only one Air Force member. However, 30 of them covered tbe household goods of two or more members, varying from 2 to 7 of them.
The total weight of household goods on each bill of lading varied from 366 to 11,927 pounds, except that one bill of lading covered 13,402 pounds.
The weight of the household goods of the individual members ranged from 366 to 6,690 pounds.
Within the 82-day period during which the actual mass movements from the Misawa and Yokota installations occurred, plaintiff removed therefrom (and in due time delivered to the Florida destination) a total weight of about 622,000 pounds of household goods. Involved were the individual shipments of household goods of 311 members of the Air Force. Thus, the weight of individual shipments averaged about 2,000 pounds per member, which was an average weight reasonably within the contemplation of MTMTS and plaintiff at the time of the MTMTS request and plaintiff's submission of its volume rates.
11. All of the household goods involved herein were transported by plaintiff to Eglin Air Force Base, Florida, and delivered to their proper destinations as requested by defendant, except the household goods of Airman First Class Cleland, hereinafter mentioned.
12. Plaintiff billed defendant and was thereafter paid on the basis of the applicable volume rate ($28.90 per cwt. for Misawa, or $26.80 per cwt. for Yokota) times the actual weight set forth on each of the bills of lading, except that with respect to bill of lading No. B-9033412, Item 151 in Joint Exhibit No. 7a, 366 pounds were billed as 500 pounds.
For example, on one bill of lading involving an aggregate of 6,745 pounds of household goods of four Air Force members, plaintiff billed at its Misawa volume rate of $28.90 per cwt., applied to 6,745 pounds, for charges on that bill of lading of $1,949.31.
In this manner, and aside from accessorial services, plaintiff originally billed and was paid $166,197.53 on the pertinent shipments, with respect to the 225 bills of lading included in plaintiff's claim herein.
13. Subsequently, beginning July 27, 1965, and ending November 30,1965, plaintiff submitted supplemental billings to defendant on each of 225 bills of lading on tbe basis of the volume rate, ($28.90 per cwt. for Misawa, or $26.80 per cwt. for Yokota) applied to 12,000 pounds per bill of lading. This method of computation had no effect on the bill of lading covering 13,402 pounds, as plaintiff had billed on the actual weight of that shipment, and plaintiff submitted no supplemental billing thereon.
For an example of the supplemental billings, adverting to the above-mentioned bill of lading involving an aggregate of 6,745 pounds of household goods, plaintiff's supplemental billing was at its Misawa volume rate of $28.90 per cwt., applied to 12,000 pounds, for claimed charges on that bill of lading of $3,468, or >an increase of $1,518.69 from the $1,949.31 previously billed and paid.
In this manner, applying the $28.90 or $26.80 rate to 12,000 pounds, for each bill of lading, plaintiff computed the pertinent transportation charges on its supplemental billings on the 225 bills of lading in the total amount of $733,428, an increase of $567,230.47 over the amount previously billed and paid.
14. Defendant has refused to pay these supplemental billings.
15. On the basis that the correct computation of charges is the maimer used by plaintiff in its supplemental billings, as contended by plaintiff but disputed by defendant, the parties agree that the amomit of plaintiff's recovery would be $567,230.47, the amount sought by plaintiff in its petition as amended at the pretrial conference herein.
If otherwise recoverable, such sum is subject to reduction by setoff of part or all of the $9,406.33 sought by defendant in its counterclaim, to the extent such counterclaim is sustained.
16. The counterclaimed amount of $9,406.33 includes three items: (1) The sum of $128.42, which the parties agree defendant is entitled to recover on its counterclaim, by setoff or otherwise, irrespective of the disposition of other issues in the case; (2) the sum of $555.09, which concerns the issue of the proper charges for returning the property of Airman First Class Cleland from Pensacola, Florida to Misawa Air Base, Japan, and which sum the parties agree is the correct amount of recovery by defendant, if defendant's method of computation of such charges is sustained; and (3) the sum of $8,722.82, which plaintiff included in its original billings and was paid, as additional charges over and above its volume rate computations, for accessorial services performed on the pertinent shipments, and which sum the parties agree would be the correct amount of recovery by defendant on its counterclaim, provided defendant's position, contested by plaintiff, is sustained that the accessorial services were not additional to, but included within, those to be provided pursuant to plaintiff's volume rate tenders for the pertinent volume rates.
17. With respect to the issue concerning accessorial charges, the parties agree that the sum of $8,722.82 is not recoverable by defendant, if defendant's alternative theory disputed by plaintiff is sustained that the applicable rate in this case is $36.90 per cwt., subject to a 500-pound minimum weight per shipment. However, the parties agree that such sum is recoverable by defendant if the pertinent volume rates are applicable, either as interpreted by plaintiff or by defendant, provided defendant's position is sustained on the inclusion of accessorial services in the pertinent volume rates.
18. On the basis that the applicable rate is $36.90 per cwt., with a minimum weight of 500 pounds per shipment, the parties agree that plaintiff would be due the sum of $57,324.06 as additional charges on the pertinent shipments, subject to application of any valid setoff.
19. Except for minor insignificant deviations, plaintiff was the sole carrier utilized by defendant on the pertinent mass movements of household goods.
20. Plaintiff's general agent in Japan was Thru-Container Services, Inc., and Thru-Container arranged to have plaintiff's local agent at Misawa, and also plaintiff's local agent at Yokota, pack the household goods of a transferring member of the Air Force into containers and remove the same from the pertinent base for transportation to an ocean port.
The ocean ports utilized were Yokohama for the Yokota shipments and Hachinohe for the Misawa shipments, with the land transportation distances involved being respectively 35 and 15 miles. Thru-Container consolidated the shipments in a warehouse at each port, awaiting ocean transportation. Three vessels carried the shipments to Pensacola, Florida.
21. Prior to the start of either of the mass movements, defendant's Traffic Management Officer at each base was advised by MTMTS that plaintiff had submitted the lowest volume rate, and each was supplied with a copy of plaintiff's volume rate tender and copies of the tenders of higher rates by other carriers on the pertinent mass movement.
22. To meet the 12,000-pound minimum weight requirement of the pertinent volume rate, the Traffic Management Office at each base planned to use and did use a different method of cross-referencing of bills of lading.
The method employed at Misawa is exemplified by two successive bills of lading issued May 12 and 13, 1965, covering respectively 5,269 and 7,782 pounds of household goods, or a total of 13,051 pounds. It was stated on the first of these two bills of lading that the 5,269 pounds covered a portion of a volume tender shipment, and on the second, that the 7,782 pounds were the remainder of the volume shipment initiated by the first bill of lading, stating the number of the prior bill.
The cross-referencing at Yokota was accomplished by grouping together ten successive shipments, aggregating in excess of 12,000 pounds, and by noting on the reverse side of each of the ten bills of lading, under the heading, Special Services Ordered, that each shipment was consolidated with the other nine shipments, with the numbers of the ten successive bills of lading noted.
23. The authority for cross-referencing of bills of lading in mass movements of household goods is contained in paragraph 16 of the regulations of the Defense Supply Agency, DSAR 4500.1, effective at all times relevant in this case, which provided in pertinent part as follows:
(a) Transportation officers making volume (mass) movements of household goods (as defined in par. XVII, DSAE 4500.1) will issue a separate Government bill of lading for each member's goods (each lot). Each bill of lading covering a portion of the volume (mass) movement will be appropriately cross-referenced in the "Special Services Ordered" space on the reverse of the bill of lading as follows:
1. First bill of lading issued to cover a portion of the volume movement tendered carrier_(date)_ comprising approximately —,--— pounds.
2. Second (and succeeding) bill of lading issued to cover a portion of the volume (mass) movement tendered carrier (date) comprising approximately _pounds, the first portion (s) of which moved on bill(s) of lading No.(s) (symbol, serial number (s), and date(s)).
3. Final bill of lading issued to cover the remainder of the volume (mass) movement tendered carrier (date) comprising--— pounds, the first portion of which moved on bills of lading Nos. (symbol, serial numbers, and dates).
(b) When consolidation of two or more shipments will result in the application of a volume rate, i.e., 8,000#, 12,000#, etc., transportation officers will issue a separate Government bill of lading for each member's goods (each lot) and identify each bill of lading in the "Special Services Ordered" space on the reverse of the bill of lading as follows: "This is a consolidated shipment comprised of bills of lading Nos. (symbol and serial numbers)."
The Traffic Management Office at Misawa relied upon the provisions of paragraph (a) above, whereas at Yokota, paragraph (b) was considered applicable.
24. Prior to the start of each of the subject mass movements, the manager of Thru-Container conferred with defendant's Traffic Management Officer at each of the bases, and a discussion occurred concerning defendant's method of processing shipments of household goods to be used on each mass movement. Each Traffic Management Officer explained to Thru-Container his method of cross-referencing bills of lading to meet the 12,000-pound minimum weight requirement of plaintiff's volume rate.
In the discussion at each base, both Thru-Container and each Traffic Management Officer understood that plaintiff would be utilized as the sole carrier on each, of the subject mass movements, and both knew, and it was discussed, that plaintiff's packing capability was limited at each base, with one local agent available at each location.
25. The established procedures, as explained to Thru-Container and applied on the pertinent mass movements, were that when a member of the Air Force came to the Traffic Management Office, with his orders concerning his transfer to Eglin Air Force Base, Florida, a date was set for the packing and pickup of that member's household goods, usually 7 days later, but sometimes sooner.
The Traffic Management Office then promptly notified Thru-Container, or the local agent, of the scheduled pickup of that member's household goods, either by telephone or by direct contact with a representative at the base. Thru-Container would then conduct a presurvey, or inspection of the pertinent household goods, to determine the requirements for the particular shipment. The bill of lading was issued prior to the pickup date, but usually after the presurvey had been conducted. Before the removal of the shipment from the base, an entry was made on the bill of lading, showing the weight of the shipment.
26. The pickup of the individual shipments occurred over the entire period of the mass movements, and each of the local agents was fully occupied on the pertinent mass movement.
27. The manager of Thru-Container frequently complained to defendant's Traffic Management Officer that plaintiff's packing capability at Misawa was so short that defendant should space out the shipments so that they could be more easily handled.
28. Except for the one bill of lading covering 13,402 pounds, concerning which plaintiff presents no claim, defendant did not offer to plaintiff at any one time on either of the subject mass movements, 12,000 or more pounds of household goods.
29. Under the heading of Tariff or Special Bate Authorities, each bill of lading was annotated by the appropriate Traffic Management Office, to show that the shipment was moving under the pertinent volume rate.
30. Plaintiff, by its authorized agent, Thru-Container, was fully aware of the methods employed by defendant in its efforts to take advantage of the pertinent volume rates, and was aware of the intended use of such methods prior to the start of subject mass movements.
At no time, throughout the subject mass movements, or prior thereto, did Thru-Container object to defendant's procedures, or to defendant's interpretation of the meaning of a tender of a minimum of 12,000 pounds of household goods under the provisions of the pertinent volume rate quotations.
31. Each of plaintiff's volume rate tenders provided in part as follows:
23. Alternation: Volume of Traffic: This tender will not apply where charges accruing hereunder exceed charges otherwise applicable for the same service. Receipt of this tender shall not be construed as a guarantee by the Government of any particular volume of the traffic hereunder described.
32. Each of the MTMTS letters, quoted in findings 4 and 6, stated that any volume rate quoted on the subject mass movements "would be a deviation from your present rate."
33. Outstanding instructions of MTMTS to all approved household goods carriers required submission by a carrier to MTMTS of an electronic punch card, called an EAM card, appropriately punched in accordance with the instructions, to cancel an existing 500-pound minimum rate on file with MTMTS.
Plaintiff failed to offer any evidence that it filed any EAM card, purporting to cancel its 500-pound rate mentioned in finding 3, or any other evidence of cancellation of such rate.
Plaintiff's previously filed rate of $36.90 per cwt., with a 500-pound minimum weight, for shipment of household goods from military installations in Japan to points in Florida, remained in force and effect and available to defendant throughout the periods of time involved in the subject mass movements.
34. Each of plaintiff's volume rate tenders provided in part as follows:
16. Accessorial Services. Tbe accessorial services shown below will be furnished by the carrier on request of the shipper at the rates or charges specified in this item, which will be in addition to the rates or charges shown in Items 11 and 12. Such requests must be shown on the bill of lading and initialed by the person requesting same.
The referenced Items 11 and 12 covered the quotation by plaintiff of the respective volume rates per cwt., with the 12,000-pound minimum weight.
Directly below the above-quoted provision concerning ac-cessorial services, and within the appropriate space provided, plaintiff had on each of its tenders the typewritten words "Included in Transportation Bates."
35. In connection with its original billings in this case, plaintiff billed and was paid $8,722.82 for storage in transit services provided on the subject mass movements of household goods.
These services were accessorial services, included by plaintiff within those to be performed for its quoted volume rates.
36. Included in the mass movement of household goods from the Misawa base was the property of Airman First Class Cleland. His household goods were transported to Pensacola, Florida, and placed in storage there. Such property was part of that shipped on one bill of lading, and plaintiff was paid for its transportation from Japan to Florida on the basis of application of the pertinent volume rate to the actual weight of the overall shipment.
In August 1965, plaintiff returned Cleland's property to Misawa Air Base, Japan upon request of defendant. Cle-land's property was returned to Misawa on the bill of lading which covered its shipment from Misawa to Florida. Defendant's transportation officer at Eglin Air Force Base issued a notice of diversion or reconsignment of Cleland's property from Eglin to Misawa, and no other bill of lading was issued.
In April 1966, and aside from certain other charges not in dispute in this case, plaintiff billed and was paid $911.47 for the transportation of Cleland's household goods from storage in Pensacola, Florida to Japan. Plaintiff computed the contested charges at a rate of $87.98 per cwt., applied to the 1,036 pounds of household goods involved. The charges not in dispute were $5 as diversion fee, $10.36 for storage in transit in Florida, and $5.18 for warehouse handling.
In its schedules in evidence in this case, prepared pursuant to Appendix C of the rules of this court, the General Accounting Office computed the contested charges on the return trip to Japan at $356.38, based on application of a rate of $35.90 per cwt. to the 1,036 pounds of household goods, less $1.50 per cwt. as an allowance.
Thus, defendant's claimed overcharge on this shipment amounts to $555.09, one of the items of counterclaim mentioned in finding 16.
The parties agree that the single-factor line-haul rate applicable to shipments originating at Eglin Air Force Base, Florida to Misawa Air Base, Japan, in effect >at the time the property of Airman First Class Oleland was returned to Japan, was $35.90 per cwt., less $1.50 per cwt. as an allowance.
Plaintiff failed to offer any evidence concerning the existence of the rate upon which it based its billing on the shipment involved in this item of the counterclaim, or any evidence of the existence of any other rate which might have been applicable in lieu of that used by the General Accounting Office.
Conclusion oe Law
Based upon the foregoing findings of fact and opinion which are adopted by the court and made a part of the judgment herein, the court concludes as a matter of law that plaintiff is not entitled to recover on its petition as amended, that plaintiff's petition as amended is dismissed, that defendant is entitled to recover on its counterclaim, and that judgment is entered for defendant on its counterclaim in the sum of $9,406.33.