Eastern Freight Ways v. United States

• Decision Date: 17 July 1958
• Docket Number: Docket 25002.,No. 351,351
• Citation: 257 F.2d 703
• Parties: EASTERN FREIGHT WAYS, Inc., Plaintiff-Appellant, v. UNITED STATES of America, Defendant-Appellee.
• Court: U.S. Court of Appeals — Second Circuit

257 F.2d 703 (1958)

EASTERN FREIGHT WAYS, Inc., Plaintiff-Appellant, v. UNITED STATES of America, Defendant-Appellee.

No. 351, Docket 25002.

United States Court of Appeals Second Circuit.

Argued May 8-9, 1958.

Decided July 17, 1958.

Goldman & Drazen, New York City (Milton D. Goldman, Daniel M. Shientag, New York City, of counsel), for plaintiff-appellant.

Paul W. Williams, U. S. Atty., S.D. N.Y., New York City (William Stackpole, Elliot L. Hoffman, New York City, of counsel), for defendant-appellee.

Before WATERMAN and MOORE, Circuit Judges, and GALSTON, District Judge.

WATERMAN, Circuit Judge.

Plaintiff-appellant, a motor carrier, brought this action against the United States under the Tucker Act, 28 U.S.C. § 1346(a) (2), to recover amounts allegedly due for the carriage of freight by appellant's predecessor, State Parcel Corporation, for the United States Army from June 1, 1942 to April 23, 1945. Some five hundred separate shipments are involved, all of which were carried from the Schenectady General Depot of the United States Army to places in the New York metropolitan area. Shortly after each shipment was delivered, the Government paid for it at the tariff rate upon the submission by the carrier of appropriate vouchers and bills of lading. The dispute arose when the United States, commencing in August, 1944, claimed that a special rate had been in effect and that it had been overcharged. Eventually, claims for overcharges totaling approximately $28,000 were sent to the carrier, all of which were either paid under protest by the carrier or deducted by the United States from subsequent freight bills.

In February 1953, the carrier brought the present action to recover its payments and the deductions taken by the United States. After a trial without jury the district court found for the United States on the facts and granted judgment for the United States dismissing the complaint. This appeal presents three questions: (1) whether the claims asserted by the carrier are barred by the applicable statute of limitations; (2) whether the special rate relied on by the Government is a legal rate; and (3) if the special rate is a legal rate, whether the district court erred in determining that the carrier failed to carry its burden of proof in support of its contention that a cancellation on its face of another special rate should be reformed for mistake so as to cancel the special rate the United States relied upon.

1. Statute of Limitations. The United States contends that the carrier's claims are barred by the two-year limitation period of 49 U.S.C.A. § 304a, applicable to claims of motor carriers against shippers. The carrier, on the other hand, contends that the applicable statute of limitations, when the United States is the shipper, is the six-year limitation of the Tucker Act, 28 U.S.C. § 2401(a). The district court, in a thorough opinion by Judge Bryan, 155 F. Supp. 22, decided this issue in favor of the carrier.

Were this a matter of first impression we would concede that the Government's arguments have considerable force. But over thirty years ago it was established in decisions of the Court of Claims that the applicable statute of limitations in a case of this kind was the six-year limitation of the Tucker Act, 28 U.S.C. § 2401(a). Southern Pacific Company v. United States, 1926, 62 Ct. Cl. 391. In the intervening period, this interpretation of the federal statutes has become settled law and innumerable suits have been brought under the six-year limitation of the Tucker Act. See, e. g., Hughes Transportation, Inc., v. United States, D.C.E.D.S.C.1953, 109 F.Supp. 373. The Supreme Court has refused to grant certiorari to review the question on at least two occasions in recent years. Union Pacific R. Co. v. United States, 1949, 86 F.Supp. 907, 114 Ct.Cl. 714, certiorari denied, 1950, 339 U.S. 930, 70 S.Ct. 664, 94 L.Ed. 1350; Seaboard Air Line R. Co. v. United States, 1949, 83 F.Supp. 1012, 113 Ct.Cl. 437, certiorari denied 338 U.S. 848, 70 S.Ct. 88, 94 L. Ed. 519.

Despite this history, the United States asks us to consider the matter anew. It relies on a dictum contained in a footnote to Mr. Justice Harlan's opinion for the Supreme Court in United States v. Western Pacific R. Co., 352 U.S. 59, 71, note 13, 77 S.Ct. 161, 1 L.Ed. 2d 126, which it interprets as casting grave doubt on the established rule granting to carriers a more lenient statute of limitations against the United States than against any other shipper. We do not presume to speculate as to the meaning of this footnote or why it was included in the opinion of the Court. We are more impressed with what the Court did. Western Pacific, a rail carrier, had commenced suit against the United States as shipper, 352 U.S. 59, 77 S.Ct. 161. Despite the fact that the statute of limitations in a suit against the Government is a jurisdictional matter which can be considered by a federal court even though not raised by the parties, Finn v. United States, 1887, 123 U.S. 227, 8 S.Ct. 82, 31 L.Ed. 128, the Court applied the six-year period of the Tucker Act rather than the two-year period of § 16(3) of the Interstate Commerce Act, 49 U.S.C.A. § 16(3). It is not within our province, on such a showing as this, to reinterpret statutes which have had a settled construction, constantly applied, for more than thirty years.

2. Legality of the Special Rate. The carrier submitted a special rate quotation to the United States effective September 2, 1941 offering a flat rate for all commodities shipped from the New York area to the Schenectady General Depot of the United States Army. The flat rate quoted was an average of the published tariffs on the commodities usually shipped by the United States. Subsequently the carrier made a similar offer, effective September 15, 1941, for all commodities shipped from Schenectady to the New York area. On November 1, 1941 the carrier transmitted a notice of cancellation to the Government. The cancellation, on its face, applied only to the September 2 special rate covering shipments from New York to Schenectady. The carrier claims that this was an inadvertence and that the cancellation was intended to affect the offer of September 15, covering shipments from Schenectady to New York, as the United States either knew or should have known. In any event, from that time forward the carrier billed all Schenectady-New York shipments to the United States at the tariff rate, and was paid on that basis. On post-audit the Government, stating that the special rate quotation of ...