FREIGHT CLAIMS Many overcharges are immediately evident to the destination carrier, or to the consignee, and in such cases correction of the lawful charge should be made without the expense of, and time incident to, adjustment through the medium of a claim. If the amount collected differs either way it is the duty of the carrier to refund the overcharge, or to collect the undercharge. The consignee should examine freight bills immediately upon receipt and when errors in charges are discovered request the delivering agent to make correction, thus OVERCHARGES avoiding many overcharges and undercharges that otherwise would become the subject of claims. AND UNDER CHARGESHOW TO AVOID (Con.) OVERCHARGE CAUSES OF Shippers occasionally incur loss to themselves or their consignees by inserting incorrect routing in bills of lading or failing to designate desired delivery at destination. As they are charged with a knowledge of tariffs, they are responsible for their own misrouting. Carrier at point of origin should carefully examine bills of lading before signing them and call the shipper's attention to any routing or other instructions that are not in accordance with tariff or classification provisions. Many shipments are delivered the carriers without routing being designated on bills of lading. In such instances it is the carrier's duty to forward the shipments via the cheapest reasonable route, and they are responsible for their failure to do so. Overcharges are due to the application of rates in excess of those legally published in tariffs, improper classification of freight, incorrect weight, or to the assessment of charges the absorption of which by the carrier is provided in tariffs. An essential feature in the prompt adjustment of claims of this class is the submittal by claimant of full information evidencing the overcharge. The laws governing Intrastate and Interstate transportation of freight make it unlawful for a carrier to exact, or a shipper or consignee to pay, any greater or less charge for the transportation of freight, or for any other service performed by the carrier, than that published in tariffs lawfully filed with State commissions or Interstate Commerce Commission, and also make it unlawful for a shipper to misdescribe a shipment in order to obtain a lower charge than would be made if the shipment was corretly described. When freight is incorrectly described, correction must be made to conform to classification and tariff provisions. Under the law, the carrier and shipper or receiver are equally bound by the provisions of State and Federal laws to know the lawful rates and to see that charges are assessed in accordance therewith. Overcharges and undercharges in rates arise from various causes, among which the following may be mentioned: (a) Application of erroneous rates in billing. (b) Improper or inadequate description of articles, by reason of which wrong rates are applied. (c) Errors in computation or in extension of charges on way bills or freight bills. (d) Errors in routing, by reason of which excess charges are assessed. (e) Waybilling charges collect when prepaid by shipper. (f) Lack of correct information of classification or commodity ratings by shipping clerks. (g) Application of class rate where commodity rate is provided. CAUSES OF STANDARD OVERCHARGE OVERCHARGE INTEREST ON FREIGHT CLAIMS Overcharges and undercharges in weight are usually attributable to one of the following causes: (a) Errors and omissions in the preparation of bills of lading by shippers. (b) Failure to accurately weigh freight at point of origin or before delivery to consignee. (c) Failure of shipper to show on bill of lading information required by classification or tariff. (d) Incorrect tare weight stenciled on cars. (e) Incorrectly reading the tare weight stenciled on cars. (f) Failure to deduct allowance for weight of dunnage, stakes, snow, etc. When commodities are shipped subject to standard weights established by Consolidated Freight Classification, tariff or trade practices, bills of lading and shipping orders should give reference to the number of packages and the legal or trade standard weight per package, as for example: 200 barrels apples-150 pounds each. Observance of this rule by shippers will aid materially in reducing overcharges on fruits, vegetables and many other commodities that are shipped in packages of standard and uniform size. Claim for overcharge in rate should be suported by reference to the particular tariff upon which claim is based and the following documents: Original Bill of Lading (if not previously surrendered to carrier), if the shipment was prepaid or misrouted. Original Paid Freight Bill. Original Invoice or certified copy, if claim is based on valuation or misdescription of shipment. As in the case of overcharge or undercharge in rate, it is the lawful duty of carrier or shipper or consignee to require an adjustment of the charges to the basis of the proper weight of the shipment. Claim for overcharge in weight should be supported by the following documents: Original Bill of Lading (if not previously surrendered to carrier) if charges were prepaid. Original Paid Freight Bill. Weight Certificate or other evidence of correct weight. In the matter of interest on overcharge claims (amount collected on a shipment in excess of the legally published rate) the Interstate Commerce Commission, in Conference Ruling No. 489, says: "Interest on an overcharge (by which is meant the amount collected on a shipment in excess of the legally published rate) accrues from the date of its collection by the carrier, whether arising from an error in rate, weight or classification. "The Commission does not regard it as unlawful for a claimant to accept in satisfaction of his claim the ascertained amount of an overcharge without interest; and the Commission is of the opinion that when such a refund is made by the carrier within 30 days after the improper collection of the overcharge, it may be regarded, in accordance with a well-established usage, as a cash transaction, upon which interest does not accrue. INTEREST ON OVERCHARGE REPARATION THREE-YEAR FREIGHT CLAIMS "The views expressed in this ruling shall be understood as applying to all pending and unsettled overcharge claims and to those arising in the future, but not as authorizing or requiring the reopening of any claim which has been settled and closed by the acceptance by a claimant of the amount of an overcharge without interest." A claim for reparation is made when the rate paid on a shipment, although legally applicable, is considered unjust or unreasonable. Such claims on interstatc shipments can only be paid by order of the Interstate Commerce Commission, and must be submitted in the form of a complaint in accordance with the Commission's Rules of Practice (see page 337). They are barred by statute unless filed with the Commission within two years from the time the cause of action occurs, as prescribed in Section 16, paragraph 3 (b) of the Interstate Commerce Act. (See I. C. C. Conference Ruling 508 and others, also Form 23.) The United States Supreme Court in the case of Kansas City Southern Railway Company v. Harry B. Wolff et al., decided February 19, 1923, that the period of limitation contained in Section 16 of the Interstate Commerce Act applied to claims for overcharge, as well as to claims for reparation, and that a claim for overcharge is extinguished if complaint thereon is not filed with the Interstate Commerce Commission or suit commenced in Court within the prescribed time. At that time the period of limitation was two years, but amendment to Section 16 of the Interstate Commerce Act was approved June 7, 1924 (see page 302), whereby claims for overcharge on shipments delivered or tendered for delivery between March 1, 1920, and June 7, 1922, might be paid on or before December 7, 1924, but not thereafter unless made the subject of suit or complaint to the Interstate Commerce Commission on or before the last mentioned date. With respect to claims for overcharge on shipments delivered or tendered for delivery subsequent to June 7, 1922, if claim is presented in writing to the carrier within three years from date of delivery or tender of delivery, the three-year period of limitation is extended to include six months from the time carrier declines the claim in writing. Intrastate shipments are not affected by the foregoing for the reason that such traffic is not subject to the Interstate Commerce Act. LAND GRANT RATES AND MILEAGES LAND GRANT RATES AND MILEAGES REASON FOR To assist and foster the construction of railroads in the pioneer days, the Federal government gave land, wholly or in part, for their way and structure. The land granted to the railroads usually embraced a large amount of land extending back from the right of way. By this act on the part of the government special concessions were agreed to by the railroads, among which were the carriage of government freight or persons at a certain reduction under the rate or fares that applied to commercial traffic (full tariff rates). In addition to the granting of land, the government has in the past assisted railroad projects by furnishing bonds to aid in construction, and also by delivering rolling stock over to established carriers, such as cars and locomotives. While it is the general practice to apply Land Grant Rates on government shipments when moving on government bills of lading, still if the carriers so elect, freight consigned to and intended for a State, City, etc., may receive on its shipments a STATE, CITIES, reduction in the lawful tariff rate that applies on commercial freight, but such reduction has to be arranged before the traffic moves. Federal government shipments can be forwarded at the pleasure of the government as under Land Grant arrangements settlement is made through Washington after shipment reaches destination. ETC., INTEREST APPLICATION Circulars are issued by governmental and railroad bureaus that show mileage between principal points, and what portion of the mileage is subject to "Land Grant” deductions, together with the percentage of the rate that should apply. In figuring the percentage of the commercial rate where a division of such rate occurs between two or more carriers the net rate is determined by dividing the through rate on commercial divisions between the carriers and then to each of the commercial divisions apply the land grant percentage; as an illustration, commercial freight rate on a given commodity from Minneapolis, Minn., to Benton, Ark., is $1.00 per 100 lbs. Assuming that the lowest land grant is via Omaha, Nebr., and the division is 50 per cent north of Omaha and 50 per cent south of Omaha for the two lines involved in the movement. As shown in the schedule on page 175 (Circular Number 17 of Quartermaster General's Office) the commercial proportion of 50 cents is subject to a net land grant deduction north of Omaha of 38.7% (or 19.35c) and south of Omaha the net land grant deduction is 24.308% (or 12.154c), so that after the deductions have been made payment to carriers would be the balance, 61.3% or 30.65c north of Omaha, and 75.692% or 37.846c south of Omaha, making a total charge of 68.496c per 100 lbs. These percentages are applicable during season of navigation, and on L. C. L. business to or from points beyond are subject to the authorized deduction for the Pere Marquette on breakbulk freight. ? Deduct New York terminal of 3 cents per cwt. and apply percentage shown to balance. Deduct Philadelphia terminal of 12 cents per cwt. and apply percentage shown to balance. * Denotes Free Line. |