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Northern Pac. Ry. Co. v. United States.

July 8, 1946


Author: Minton

Before SPARKS, KERNER, and MINTON, Circuit Judges.

MINTON, Circuit Judge.

This suit was brought under the Tucker Act*fn1 to recover the difference between freight charges billed by the plaintiff at the full tariff rates and the amounts paid by the defendant at land grant rates for transportation of shipments of Government property. The parties entered into a stipulation of the facts which was adopted by the District Court as its findings of fact.

Judgment from which this appeal is taken was entered dismissing plaintiff's claim to recover freight charges on five shipments. The error relied upon is the District Court's conclusion of law that each of the five shipments was "military or naval property moving for military or naval, and not for civil use," and entitled to land grant rates under Section 321(a) Transportation Act, 1940, 49 U.S.C.A. ยง 65(a).

The facts as to the five shipments in controversy are as follows:

(1) Copper cable.In August, 1941, plaintiff and connecting, carriers transported from Pawtucket, Rhode Island, to Tacoma, Washington, and delivered to consignee 15,780 pounds of insulated copper cable shipped by Inspector of Naval Material, United States Navy, Boston, Massachusetts, consigned to District Material Officer, 13th Naval District, % Seattle-Tacoma Shipbuilding Corporation, for Maritime Commission, Hull 123. The cable was furnished by the Navy Department for use in insulation of degaussing equipment (to neutralize magnetic mines) on Hull 123. Hull 123 was a single screw cargo vessel being built by the Seattle-Tacoma Shipbuilding Corporation under contract dated October, 1939, between said shipbuilding corporation and the Maritime Commission. In 1940, while the vessel was under construction, it was decided by the Navy Department and the Maritime Commission that all vessels under construction for the Commission should have degaussing equipment. Specifications for the degaussing equipment for Hull 123, later known as the S. S. Idaho, were furnished by the Navy Department which assumed and paid the cost of installation and all transportation charges.The Hull was delivered on September 8, 1941, and was operated as directed by the Maritime Commission or the War Shipping Administration.

(2) Lumber for construction of a munitions plant. In January and February, 1942, the plaintiff transported from plants in Washington to New Brighton, Minnesota, seven carloads of lumber shipped by various lumber companies, consigned to the United States Area Engineer, Twin Cities Ordnance Plant, % Foley Brothers, Inc., and Walbridge, Aldinger Company. The lumber was for the construction of the Twin Cities Ordnance Plant at New Brighton for manufacture of .30 and .50 caliber ammunition under a cost-plus-fixed-fee construction and operation contract entered into in July, 1941, by the War Department with the Federal Cartridge Corporation of Minneapolis, Minnesota. Foley Brothers, Inc., and Walbridge, Aldinger Company were sub-contractors for construction.

(3) Lumber for construction of pontoons. In May, 1943, plaintiff transported from Bucoda, Washington, to Minneapolis, Minnesota, 113,120 pounds of fir lumber shipped by Mutual Lumber Company, consigned to Depot Quartermaster, % Crown Iron Works, for United States Marine Corps. The lumber was shipped to be urea salts treated, kiln dried, milled and manufactured into trestle balks and pontoon balks, sills and chess, at Crown Iron Works pursuant to a contract with the corporation. The trestle and pontoon balks were shipped overseas for construction of a bridge for use in military operation or were used in construction of pontoon bridges and piers at Camp Lejeune, North Carolina, and Quantico, Virginia, for training combat engineers.

(4) Bowling alleys. On February 13, 1942, plaintiff and connecting carriers transported from Muskegon, Michigan, to Seattle, Washington, 29,037 pounds of bowling alley outfits, shipped by Inspector of Naval Material consigned to the Officer in Charge, Siems-Drake Puget Sound Company, Seattle, Washington, for reshipment to a Naval Air Base, Dutch Harbor, Alaska. The land on which the air base was constructed was reserved for Navy use. The alleys were procured on a contractor's purchase order and installed in a building at Dutch Harbor. The building was intended for a recreation center for the contractor's men and later as a recreation center for the military personnel at the station.

(5) Liquid paving asphalt. On January 26, 1942, plaintiff and connecting carrier transported from Richmond, California, to Seattle, Washington, 1,259 barrels of liquid paving asphalt consigned to Civil Aeronautics Administrator, Alaska Project Warehouse, Seattle, Washington, for export. The asphalt was for use in constructing runways at an airport at Cold Bay, Alaska, under a program entitled, "Development of Landing Areas for National Defense," conducted by the Civil Aeronautics Administration. The land on which the airport was constructed at Cold Bay was owned by the United States and reserved for the use of the Navy by executive order. On December 15, 1941, Major General S. B. Buckner, Jr., Headquarters, Alaska Defense Command, Fort Richardson, Alaska, advised the Civil Aeronautics Administration that the field at Cold Bay was vital to the immediate defense of key points in Alaska, and in his letter of that day listing order of priority for the preparation of air fields in Alaska, he placed the Cold Bay project first in importance. At the time of the invasion of the Aleutians by the Japanese, the field at Cold Bay played an important part in the defense of Alaska. Bombers based at Cold Bay turned back the Japanese attack on Dutch Harbor.

The property was transported on Government bills of lading or commercial bills subsequently exchanged for Government bills. The amount claimed on five shipments is $3,569.75.

The District Court rendered an opinion holding that each of the above shipments was "military or naval property" within the meaning of Section 321, and from the judgment following this opinion, the Northern Pacific Railway Company appeals.

Prior to the passage of the Transportation Act of 1940, all property owned by the United States moved over land grant routes at land grant rates. From time to time, the Congress has passed legislation relieving the railroads of the obligation to give to the Government certain preferential treatment in rates.*fn2 The Transportation Act of 1940 carried this legislative tendency further. It provided in Section 321(a): "Notwithstanding any other provision of law, but subject to the provisions of sections 1(7) and 22 of the Interstate Commerce Act, as amended, the full applicable commercial rates, fares, or charges shall be paid for transportation by any common carrier subject to such Act of any persons or property for the United States, or on its behalf, except that the foregoing provision shall not apply to the transportation of military or naval property of the United States moving for military or naval and not for civil use or to the transportation of members of the military or naval forces of the United States (or of property of such members) when such members are traveling on official duty."

At the time of the enactment of the Transportation Act of 1940, it was obvious that the general needs of security demanded a greatly expanded Army and Navy.Such enlarged military and naval forces would demand supplies and equipment far in excess of the then existing reserves. With the war spreading throughout Europe in 1940, and with the knowledge of the meagre and inadequate military strength of the United States, it is most unrealistic to presume that Congress intended any restrictive meaning of "military or naval property" as used in the Transportation Act of that crucial year. To define "military and naval ...

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