United States v. New York, New Haven & Hartford R. Co., 5090.

• Citation: 236 F.2d 101
• Decision Date: 10 August 1956
• Docket Number: No. 5090.,5090.
• Parties: UNITED STATES of America, Defendant, Appellant, v. The NEW YORK, NEW HAVEN AND HARTFORD RAILROAD COMPANY, Plaintiff, Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (1st Circuit)

236 F.2d 101 (1956)

UNITED STATES of America, Defendant, Appellant, v. The NEW YORK, NEW HAVEN AND HARTFORD RAILROAD COMPANY, Plaintiff, Appellee.

No. 5090.

United States Court of Appeals First Circuit.

August 10, 1956.

Alan S. Rosenthal, Atty., Dept. of Justice, Washington, D. C., with whom Warren E. Burger, Asst. Atty. Gen., Anthony Julian, U. S. Atty., Boston, Mass., and Melvin Richter, Atty., Dept. of Justice, Washington, D. C., were on brief, for appellant.

Edmund M. Sweeney, Boston, Mass., for appellee.

Before MAGRUDER, Chief Judge, and WOODBURY and HARTIGAN, Circuit Judges.

MAGRUDER, Chief Judge.

This is an appeal from a summary judgment in favor of the New York, New Haven and Hartford Railroad Company against the United States in the sum of $402.84. Though the amount involved is small, this is a test case, determination of which will settle the government's liability in a number of similar suits.

In 1953 plaintiff Railroad filed its complaint in the district court against the United States under the Tucker Act, 28 U.S.C.A. § 1346, demanding judgment in the amount of $1,143.03 as payment for transportation of a certain shipment of goods in 1950. A substitute answer filed by the United States admitted liability for the amount demanded under the 1950 shipment, but pleaded payment in full, by a check for $117.77 in 1951 and by credits of $1,025.26 on account of overpayments previously made in the settlement by the United States of four bills submitted by the plaintiff for transportation of goods in 1944 — said credits being alleged to have been taken pursuant to § 322 of the Transportation Act of 1940, 54 Stat. 955, 49 U.S.C.A. § 66. The answer contained this further allegation:

"The said overpayments represent for the most part the difference between charges resulting from the use for computation purposes of carload minimum weights based on the size of car furnished and used, and the charges resulting from the use for computation purposes of carload minimum weights based on the size of car orderd by defendant and adequate for the shipment. Plaintiff at no time prior to, or subsequent to, the time of the filing of this suit furnished the defendant with facts with respect to its failure to provide defendant with the car ordered."

To this pleading the plaintiff filed an "answer" or reply, admitting the receipt of the check in the amount of $117.77 but denying that it had overcharged the United States with respect to the four shipments in 1944; "and the plaintiff further says that the defendant's determination of overpayment was arbitrary and capricious in that Service Order No. 68 as issued by the Interstate Commerce Commission on 30 January 1942 was in full force and effect and applicable thereto; and the plaintiff further says that it fulfilled its every obligation with respect to providing the defendant with any facts pertaining to such transportation."

It appears that with respect to the several shipments of naval property in 1944 the initial carrier had furnished on each occasion a freight car of greater length than that ordered in the bill of lading, and that the plaintiff, as the terminal carrier (not the railroad which furnished the cars) had collected from the government at the higher rates applicable to the size of car furnished rather than at the lower rates applicable to the smaller freight cars ordered.

There had been a long-standing unwritten rule that a carrier held itself out as being able to furnish the cars listed in its tariff, and so could not charge more when it furnished cars larger than those ordered. This rule was carried into § 6(a) of Rule 34 of the rules of the ICC:

"If carrier is unable to furnish open car of length ordered, and furnishes longer car, minimum weight shall be that fixed for car furnished, except that if articles are of such length as could have been loaded on car of length ordered, minimum weight shall be that fixed for car ordered." Italics added.

Under the foregoing rule it followed that, even if the carrier had been unable to supply the size of car ordered, it had to charge only for that size (provided, of course, that such a smaller car would have been big enough to carry the articles shipped). And if the railroad was able to furnish the car size ordered, but for its own convenience, or by error, it supplied a larger car (which would be an a fortiori case), § 6(a) of Rule 34 by its terms might not apply, but the earlier general unwritten rule required the railroad to make only the charge applicable to the smaller size of car ordered. In 1942, as a wartime measure to force shippers to make a fuller loading of cars, and thus to contribute to their more economical use, the ICC issued Service Order No. 68, above referred to, which, inter alia, suspended the provision of § 6(a) of Rule 34 that had limited charges in the case of the substitution of a larger car to the amount chargeable for the smaller size car ordered. Thus, at the time in question here (1944), if the railroad was unable to furnish the size of car ordered, the railroad properly could bill the shipper for the size of car actually supplied. However, it was determined, and we think correctly, in Atlantic Coast Line R. Co. v. United States, 1953, 112 F.Supp. 594, 125 Ct. Cl. 235, that where the carrier was able to furnish a car of the size ordered, but supplied a larger car, the proper billing was at the rate applicable to the car ordered. This was so because Service Order No. 68 purported only to suspend § 6(a) of Rule 34, whose terms referred to the situation of a carrier who was unable to furnish what was ordered; in the case of a carrier who was able, but did not, furnish the size of car ordered, the old case law rule still governed.

Thus it will be seen that for the year now in question the availability to the carrier of certain sizes of cars became the controlling question of fact in determining the validity of the charges on bills of lading in which the shipper had specified the use of a freight car of a certain size.

In the district court the plaintiff addressed a long list of interrogatories to the defendant, some of which were answered and some objected to. At a hearing on the defendant's objections, the district court ruled that the plaintiff need allege nothing beyond the facts of the particular 1950 shipment set forth in the complaint, the bill for which transportation the United States had refused to pay. The court's ruling is indicated by the following two paragraphs dictated by the judge at the conclusion of the hearing:

"The defendant contends that the plaintiff is not entitled to recover anything unless it shows that the government has not made overpayments on prior transportation contracts and designated bills which are referred to in defendant\'s answer.

"I rule as a matter of law that it is not the burden of the plaintiff to set forth in this complaint anything with respect to those prior transportation contracts; and it is not the burden of the plaintiff to make any showing that on an overall basis the government has not overpaid the plaintiff. This is a suit upon a particular contract of transportation. Other contracts claimed by way of setoff or otherwise must be set up in the defendant\'s answer and proved by the defendant."

Thereafter, the Railroad filed a motion for summary judgment, with an affidavit attached to the motion indicating that through administrative negotiations it had accepted in part the credits asserted by the General Accounting Office, reducing its demand for judgment to the sum of $402.84. The United States moved for judgment in its favor on the ground that the Railroad had "failed to plead facts entitling it to recover herein." On November 23, 1955, the district court gave judgment for the Railroad in the amount of its reduced demand, at the same time denying defendant's motion for judgment. From this judgment the United States has taken the present appeal.

It seems to us that unless the Congress has definitely prescribed otherwise, the position of the United States as shipper, so far as the present case is concerned, is no different from that of a private shipper.

If a private shipper or consignee should pay the carrier before...