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1998 Transportation and Contractual Decisions

 

      These 46 Board decisions involve a carrier's dispute over whether it is liable for transit loss or damage. They also include all kinds of quasi-contractual disputes which are settled under Section 3702 of title 31 of the United States Code. They do not include requests by carriers for review of the General Services Administration's transportation audit; the General Services Administration Board of Contract Appeals reviews such matters.

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Transit Damage; prima facie - waterbed

12/03/1998

1. A carrier fails to overcome an otherwise prima facie case of liability against it for transit damage to the baffle system in a waveless waterbed mattress merely by arguing that the shipper failed to tender the mattress in an accordion-type format and that gripping the mattress into such a shape was the only proper way to drain a waterbed mattress with baffles. The carrier did not offer evidence that the service member failed to drain the mattress in accordance with the manufacturer's instructions for the specific model of waterbed mattress involved; did not offer probative evidence that gripping the mattress into an accordion shape was the only proper way to drain the mattress; and failed to distinguish between draining the mattress and folding, rolling or gripping it. Moreover, the carrier's position on the proper method of draining and folding or rolling a baffled waterbed mattress is impeached by publicly available information from the industry suggesting that some types of waterbed mattresses with baffles may be folded for storage and transportation, while others cannot be folded and generally must be rolled. 2. Similarly, a carrier cannot overcome an otherwise prima facie case of liability for the mattress by arguing without empirical evidence that damage to the baffle system is an internal damage which is not observable at pick-up because a carrier cannot determine whether a mattress is waveless (with baffles) or non-waveless. This argument likewise is impeached by publicly available information that the baffle system may be observable.


Transit Damage; burden of proof

12/03/1998

For a Code 5 shipment, the government offered a 50% compromise liability when it could not be determined if the loss or damage to the household goods occurred in the custody of the government or the carrier. When the carrier did not promptly pay the 50% liability, the Service correctly offset the full amount of liability.


Transit Damage; measure of damage

11/17/1998

1. This Office will not question an agency's calculation of the value of the damages to items in the shipment of a service member's household goods unless the carrier presents clear and convincing evidence that the agency acted unreasonably. The Navy's acceleration of depreciation of two lamps to reflect the preexisting damage (PED) noted by the carrier on the descriptive inventory is not unreasonable unless the carrier provides additional evidence demonstrating that the applied depreciation was clearly unreasonable. The inventory description, by itself, does not justify the 75 percent (maximum) depreciation rate advocated by the carrier. 2. A carrier is not liable for internal damage to a stereo receiver when there is no evidence of external damage to the receiver or the carton containing it and the member fails to provide a statement specifically describing that it was in proper working order prior to tender to the carrier.


Transit Damage; Government Inspection Report

10/19/1998

A government inspector's opinion in a Government Inspection Report (DD Form 1841) concerning the cause of loss and damage to a household goods shipment may be considered to the extent that it is trustworthy and probative. The opinion of a government inspector that all loss and damage had taken place during non-temporary storage (NTS) cannot prevail against an otherwise prima facie case of liability against the carrier when the inspector was not present at the transfer of the shipment from the NTS facility to the carrier, it is equally possible that the loss or damage may have been incurred either in NTS or in the carrier's possession, and the carrier failed to take exception in its rider to the condition of specific items.


Transit Damage; pre-existing damages - internal damage

10/07/1998

A shipper offered sufficient proof of prima facie liability against a carrier for damage to a television when he noted on the DD Form 1840R that the television was not working, and he offers a repair estimate which describes external and internal damage with a conclusion that the cause of damage was excessive external force. The carrier's argument alone that the external damage noted on the repair estimate does not indicate rough handling does not overcome its liability for the damage to the television.


Transit Damage; prima facie - supporting documentation

10/06/1998

The military service or service member sufficiently supports the element of value of the damages in a prima facie case of liability against the carrier by providing an estimate to repair the damage. The carrier cannot overcome such a repair estimate for purposes of a prima facie case of liability against it merely by arguing that the shipper or military service failed to provide the carrier evidence of the replacement cost, purchase price and date of purchase when the carrier did not seek this information during its investigation of the claim and when the carrier did not take advantage of its opportunity to inspect the damage to offer its own evidence of damage.


Transit Damage; pre-existing damage

09/30/1998

Where the military service determines that the damage noted by the shipper on the Notice of Loss or Damage (DD Form 1840R) is transit-related damage, and the carrier provides no evidence to support its contention that the terms used on the DD Form 1840R describe the same damage noted on the carrier's rider, the carrier remains liable for the damage.


Transit Damage; tender

09/29/1998

Tender of scuba equipment and a VCR for purposes of establishing a prima facie case of liability for transit loss by a carrier may be established through a detailed written statement from the member's spouse describing the events at origin, coupled with other evidence of ownership prior to the move and an inadequate descriptive inventory.


Transit Damage; pre-existing damage - rider

09/16/1998

A descriptive inventory noted that a brown German schrank belonging to a service member was composed of "parts" involving 18 pieces. Upon receipt from a non-temporary storage facility, the carrier's representative noted in a rider that a "part" was broken and cracked. After delivery, the member observed that the schrank's "parts" had "several pieces broken and parts are missing to assemble." Without more specific factual evidence from the carrier concerning the condition of the schrank when it received the schrank from the NTS facility, the carrier's rider notation, by itself, does not relieve it from all liability because the rider may reasonably be interpreted to refer only to one broken and cracked part of the schrank.


Transit Damage; primafacie - supporting documentation

09/02/1998

The military service or service member sufficiently supports the element of value of the damages in a primafacie case of liability against the carrier by providing an estimate to repair the damage. The carrier cannot overcome such a repair estimate for purposes of a prima facie case of liability against it merely by arguing that the shipper or military service failed to provide the carrier evidence of the replacement cost, purchase price and date of purchase when the carrier did not seek this information during its investigation of the claim and when the carrier did not take advantage of its opportunity to inspect the damage to offer its own evidence of damage. This decision was affirmed by the DoD Deputy General Counsel (Fiscal) on  April 30, 2002.


Transit Damage; tender

08/24/1998

The Service has established a prima facie case for missing Hummel plates that do not appear on the inventory, and were part of one of only two missing Items in a household goods shipment, when it provides evidence of the shipper's ownership, statements from the shipper regarding the proximity of the plates to the object they were presumably packed with, and an estimate of replacement costs.


Transit Damage; salvage

08/14/1998

A provision in the Joint Memorandum of Understanding on Salvage (MOU) effective April 1, 1989, states that where the carrier has a right to salvage, and it chooses to exercise that right, it "will take possession of salvage items . . . not later than 30 days after receipt of the Government's claims against the carrier." The MOU also specifically mentions a "30-day pick up period." Thus, the plain meaning of the language indicates that the carrier has 30 days to obtain the salvage, and where the Navy fails to offer any legal basis for limiting the pick up time to less than 30 days after the carrier has requested salvage, we must allow the carrier's claim for 25 percent of the depreciated replacement value as provided in the MOU. The service member's need to make an immediate second move does not justify a limitation on the 30-day pick up period.


Transit Damage; rider

08/11/1998

A carrier excepted by written rider to its receipt of a service member's shipment at a non-temporary storage (NTS) facility because, among other things, a specific item number (434) on the Descriptive Inventory was missing. The settlement certificate found that the carrier had properly excepted to its receipt on such a basis. On appeal, the service contends that the carrier identified an incorrect item number in its rider. When facts on the record confirm that the item identified by the carrier in its rider as missing (Item 434) was the same item that the service agrees was missing (Item 134), confusion over whether the proper inventory number was 434 or 134 does not defeat the carrier's recovery.


Transit Damage; interest, penalties, administrative costs

08/11/1998

Where a military service rejects a carrier's offer to settle for transit loss and damage, and after setoff the service and carrier settle for an amount in excess of the carrier's initial offer, the carrier is liable for any applicable charges for administrative costs and interest. While the agency generally is required to collect interest, penalties and charges for administrative costs, the Federal Claims Collection Standards (FCCS) grant the service or agency (not our Office) permissive authority to waive, in whole or in part, the collection of interest, penalties and/or administrative costs as permitted under agency regulations when a compromise is effected under Part 103 of the FCCS or when the agency or service determines that collection of these charges would be against equity and good conscience or not be in the best interest of the United States.


Transit Damage; measure of damages

08/10/1998

The Army offset the amount it had reimbursed the service member for a hand-made crystal chandelier that was missing from his household goods shipment. On appeal the carrier must show that the Army's valuation of the chandelier was unreasonable.


Transit Damage; memorandum of understanding

07/15/1998

Under the Military-Industry Memorandum of Understanding on Loss and Damage Rules (MOU) the carrier is obligated to pay for damage in transit to household goods that it moved when that damage is brought to its attention in a timely manner. The wording on the carrier's check to the effect that endorsement of the check is a settlement for all claims arising from the shipment does not end or void that obligation. The carrier is still liable for damaged goods not covered by the check, but still reported in a timely manner to the carrier.


Transit Damage; notice - adequacy

06/24/1998

The shipper establishes a prima facie case of liability against a carrier, and notice of loss or damage is adequate, when the service member timely dispatches a Notice of Loss or Damage (DD Form 1840R) which identifies the specific Descriptive Inventory items missing and/or damaged even though: (1) the service member incorrectly characterizes at least one of the items as a "loss" when, in fact, it is damaged; and (2) when the carrier fails to demonstrate by clear and convincing evidence that the service member had the duty to specify whether each item was not delivered or delivered in a damaged condition and that the error in not correctly specifying one of these two conditions materially harms the carrier in defending the claim.


Transit Damage; prima facie

06/19/1998

The military service's failure to provide a carrier with a specific amount of liability for each item of damage in a claim does not invalidate an otherwise prima facie case of liability against the carrier when the military service's written claim contained a specific amount of total liability, referred to the transaction involved, and specified the damage involved for each item. However, the carrier is entitled to an explanation of the basis for the damage claimed on each item, and it cannot be forced to pay the claim until that information is provided.


Transit Damage; burden of proof

06/16/1998

case of liability against the carrier: tender of the item to the carrier, delivery in a damaged condition or non-delivery, and the amount of damages. Thereafter, the burden shifts to the carrier to show that it was not negligent and that the loss or damage was due to an excepted cause. The shipper and the service have established a prima facie case of liability against the carrier for all of the 156 compact disks (CDs) that the carrier failed to deliver when the carrier: inventories 156 CDs in individual cases as one item, delivers 134 of the cases without the CDs included, completely fails to deliver the remaining 22, and then fails to conduct an inspection of the 134 cases upon receipt of the notice of the loss. The Navy's failure to provide an itemization of the156 CDs at the carrier's request during the investigation of the claim is harmless error with respect to all 156 CDs where the carrier could have obtained the title and artist(s) for 134 of the CDs and average depreciated replacement cost is involved.


General; jurisdiction

06/16/1998

As the successor to the Comptroller General, the Defense Office of Hearings and Appeals (DOHA) has jurisdiction to entertain claims by carriers related to amounts collected from them by the military services whether those amounts were collected by setoff or through a voluntary refund.


Transit Damage; pre-existing damage

06/09/1998

case of carrier liability is established if the carrier can reasonably observe any existing damage when it receives the article but fails to document the damage. Thereafter, the burden is on the carrier to prove by clear and convincing evidence that it was not in good condition when received.


Transit Damage; pre-existing damage

05/29/1998

Where the record shows the existence of pre-existing damage, and lacks evidence of greater or different damage, the common carrier is not liable for damage in transit.


Transit Damage; tender

05/28/1998

The tender of an item is established as an element of a prima facie case of carrier liability when the item claimed as lost or damaged is reasonably related to the items shown on the inventory of a container's contents, particularly when it would not have been unusual for those items to be packed in the specific containers they were in and the carrier packed the boxes and prepared the inventory. Thus, the tender of a backpack used for camping is evidence of tender of camping equipment normally associated with it.


Transit Damage; depreciation

05/27/1998

In the absence of an agreement between the military services and the industry, where the Service applies a 10 percent rate of depreciation against a service member to the service member's claim for the loss of a camcorder, but allows only seven percent to the carrier when it recovers for this loss, the Service must provide a clear explanation for the difference in treatment and the basis for the depreciation rate.


Transit Damage; last handler rule

05/18/1998

A delivering carrier is responsible for the loss of, or damage to, a service member's household goods that were prepacked by a NTS contractor if the service member otherwise presents a prima facie case of liability against the delivering carrier.


Transit Damage; last handler rule

05/14/1998

A delivering carrier's entry on a rider it created at the nontemporary storage (NTS) facility that a container is "crushed," does not, by itself, insulate the carrier from any liability for the contents of the container. Unless the carrier inspects the contents of such damaged cartons and correctly repacks for onward movement, we have no basis to assume that the carrier did not cause all or part of the damage during its leg of transportation.


Transit Damage; notice

05/13/1998

1. The shipper adequately notifies the carrier of damage to the clothing and textiles in his household goods shipment even if the Notice of Loss or Damage (DD Form 1840R) does not include the Descriptive Inventory item number when the shipper advises the carrier in writing that "clothing/textiles" had "water damage/mildew" without specifying the item numbers involved. The carrier has sufficient notice to initiate an investigation of these damages. 2. The dispatch of a copy of a Government Inspection Report (DD Form 1841) may be adequate notice to the carrier that loss or damage has occurred in connection with a household shipment. A certification by the Installation Transportation Officer, or his representative, that a "Notice of Loss or Damage" is or will be "dispatched," coupled with regulations requiring that the carrier be provided a copy of the DD Form 1841, is evidence of dispatch of a copy of the report on the date indicated in the certification block.


Transit Damage; repair estimates

05/13/1998

1. Under the Joint Military-Industry Memorandum of Understanding on Loss and Damage Rules, Services will use the carrier's estimate when it is received within 45 days of delivery and is from a reputable repair firm which is willing and able to make the repairs. The Army's dismissal without adequate explanation of the carrier's estimate submitted within 45 days was inappropriate. 2. A carrier that chooses to inspect damages to a household goods shipment before the end of the time period for the shipper to file a DD Form 1840R runs the risk of having to conduct a second inspection if additional damage is noted on a timely filed DD Form 1840R. 3. Generally, when settling a claim for loss or damage, a common carrier by motor vehicle of household goods shall use the replacement costs of the lost or damaged item as a base to apply a depreciation factor to arrive at the current actual value of the lost or damaged item.


General: claims-new matter

04/30/1998

Generally, we will not review a claim based on a theory of recovery which was not raised by the claimant until appeal.


Transit Damage; internal damage

04/24/1998

A shipper offers sufficient proof of prima facie liability against a carrier for damage to a CD player when he offers evidence that the CD player was in good working order prior to tender to the carrier and the nature of the internal damage is consistent with its having been mishandled or dropped, e.g., physical damage to otherwise sturdy components like a circuit board or chassis. The mere lack of external damage is not sufficient evidence to rebut the carrier's liability.


Transit Damage; measure of damages

04/23/1998

This Office will not question an agency's calculation of the value of damages in a shipment of household goods unless the carrier presents clear and convincing evidence that the agency's calculation was unreasonable.


Transit Damage; accord and satisfaction - conditional endorsement

04/14/1998

A conditional endorsement on a carrier's settlement check which purported to settle all liability with respect to a bill of lading transaction does not operate to satisfy the carrier's liability with respect to a second delivery under the single bill of lading transaction where: there were two separate deliveries; it was clear from the record that the government's demand which precipitated the carrier's offer covered only the items delivered in the first delivery; and the government had dispatched to the carrier a separate DD Form 1840 and 1840R with respect to the second delivery.


Transit Damage; measure of damages - blue books

04/10/1998

Our Office will not question an agency's calculation of the value of damages to items in a shipment of household goods unless the carrier demonstrates by clear and convincing evidence that the agency's determination was unreasonable. While industry guides concerning the value of a used household good may be evidence of an item's value, they are not determinative, and an agency may consider depreciated replacement cost when reasonably determinable.


Transit Damage; burden of proof

03/13/1998

The shipper must demonstrate three things to establish a prima facie case of liability against the carrier: tender of the item to the carrier, delivery in a damaged condition or non-delivery, and the amount of damages. Thereafter, the burden shifts to the carrier to show that it was not negligent and that the loss or damage was due to an excepted cause. Where a carrier loses a 1.5 cubic foot carton of professional books in transit, the shipper fails to itemize what books were lost in transit, and the carrier fails to request support for the loss prior to agency adjudication and offset, this Board will deny the carrier's claim unless there is a sufficient basis on the record to support its claim. Settlements are founded on a determination of the legal liability of the United States under the factual situation involved as established by the written record. The burden is on claimants to establish the liability of the United States, and the claimants' right to payment.


Transit Damage; measure of damages

03/13/1998

We will not question an agency's calculation of the value of damages to an item in a shipment of household goods unless the carrier demonstrates by clear and convincing evidence that the agency's determination was unreasonable.


Transit Damage; measure of damages

03/05/1998

Consistent with the policy established by the Comptroller General, our Office will not question an agencys calculation of the value of damages to items in a shipment of household goods unless the carrier demonstrates by clear and convincing evidence that the agencys determination was unreasonable, especially where the carrier chose not to physically inspect the damaged item and where it could have developed alternative valuation evidence for our consideration by doing so.


Transit Damage; measure of damages

03/05/1998

The burden is on the carrier to prove by clear and convincing evidence that the agency's calculation of damages was unreasonable particularly where the carrier did not physically inspect a damaged item that was still available for inspection and the information required to properly investigate a claim was available through such an inspection. The carrier cannot change this result by shifting the burden of inspection to the service member or the military service.


Transit Damage; measure of damages

02/27/1998

1. The government does not present sufficient evidence concerning the amount of damages owed by the carrier for the loss of a service member's carpet in transit when the record only establishes the original purchase price and does not indicate whether the carpet lost was similar to the one upon which the estimate was based. 2. Generally, we will not review a claim based on a theory of recovery which was not raised by the claimant until appeal. 3. We will not question an agency's calculation of the value of the damages or relevant replacement costs for transit loss or damage unless the carrier presents clear and convincing evidence of the agency's unreasonableness, especially when the amounts involved are small, the damaged items are available for inspection and salvage, and the carrier offers no contrary evidence of value.


Transit Damage; notice

02/23/1998

1. The shipper adequately notifies the carrier of damage to the clothing and textiles in his household goods shipment even if the Notice of Loss or Damage (DD Form 1840R) does not include the Descriptive Inventory item number when the shipper advises the carrier in writing that "clothing/textiles" had "water damage/mildew" without specifying the item numbers involved. The carrier has sufficient notice to initiate an investigation of these damages. 2. The dispatch of a copy of a Government Inspection Report (DD Form 1841) may be adequate notice to the carrier that loss or damage has occurred in connection with a household shipment. A certification by the Installation Transportation Officer, or his representative, that a "Notice of Loss or Damage" is or will be "dispatched," coupled with regulations requiring that the carrier be provided a copy of the DD Form 1841, is evidence of dispatch of a copy of the report on the date indicated in the certification block.


Transit Damage; repair estimates

02/12/1998

A fact finder has a proper basis to question the reliability of a damage estimate for transit damage to household goods when there is an unexplained difference between the damage claimed and the damage repaired as noted in the estimate.


Transit Damage; prima facie

02/12/1998

The military service's failure to provide a carrier with a specific amount of liability for each item of damage in a claim does not invalidate an otherwise prima facie case of liability against the carrier when the military service's written claim contained a specific amount of total liability, referred to the transaction involved, and specified the damage involved for each item. However, the carrier is entitled to an explanation of the basis for the damage claimed on each item, and it cannot be forced to pay the claim until that information is provided.


Transit Damage; internal damage

02/10/1998

A shipper offers sufficient proof of primafacie liability against a carrier for damage to a television when he offers evidence that the television was in good working order prior to tender to the carrier and the nature of the internal damage is consistent with its having been mishandled or dropped, e.g. , physical damage to otherwise sturdy components like a broken circuit board or chassis. The mere lack of external damage is not sufficient evidence to rebut the carrier's liability.  This decision was affirmed by the DoD Deputy General Counsel (Fiscal) on  December 21, 2001.


Transit Damage; prima facie

01/28/1998

While a carrier may present factual evidence of actual delivery, a service member is not necessarily precluded from recovery for the loss of an item in transit just because he admits that he initialed his household inventory at destination to acknowledge receipt of the item and even though the item is one that is likely to be separately itemized on the descriptive inventory and not packed in a container or carton. Generally, the service member may challenge the presumption of the correctness of the delivery receipt when it dispatches notice of loss or damage to the carrier within 75 days of delivery. The question of whether the carrier has presented sufficient evidence of delivery (e.g., a document which purports to show the member's acknowledgment of receipt), is a question of fact.


Transit Damage; sets

01/23/1998

Where a carrier stains a sofa which is one of two components of a set of furniture (along with a love seat), and the service member cannot eliminate the stain or reupholster the sofa with a fabric that matches the fabric on the undamaged love seat, an estimate showing that the stain cannot be eliminated coupled with an estimate for reupholstering the set may be sufficient primafacie evidence of damage. This is sufficient where the carrier settles its liability merely by asserting that it is not liable for diminished value of the set but only for damage to the sofa for which it received notice of damage and where the carrier failed to offer clear and convincing contrary evidence that a lesser measure of damages would have restored the service member to the condition he was in prior to shipment with respect to the value of the furniture as a set.


Transit Damage; last handler rule

01/15/1998

When goods pass through the custody of more than one carrier or other bailee, it is presumed that any loss occurred in the hands of the last bailee. The burden then is on the delivering carrier, as the last bailee, to prove that the prior bailee was responsible for the loss. Mere allegations or suggestions that the prior bailee was responsible does not satisfy that burden.


Transit Damages; measure of damages

01/12/1998

1. The two-year statute of limitations in the Military Personnel and Civilian Employees Claim Act, 31 U.S.C. § 3721, is designed to limit the government's exposure under that Act. There is no legal authority which suggests that the two-year limit in this Act was also intended to protect third-party non-governmental entities, like a household good motor carrier, which became liable to the government in subrogation after a government agency decides that the service member's claim against the government is still timely and it pays the service member's claim for transit damage by a carrier. 2. Replacement costs are generally favored in determining the carrier's liability to the government in subrogation for transit damage to a service member's household goods. As an exception, repair costs are applied when they result in less carrier liability. In some instances, other measures like actual cash value estimated through the Table of Adjusted Dollar Value, may be reasonable. However, the carrier's opportunity to require support for the loss or damage claimed is within the 120-day period of claim settlement following the presentation of the claim against the carrier, and when the carrier does not question the calculation of damages within that period of time, the government will maintain its burden of proof for purposes of a prima facie case of liability against the carrier when it uses any reasonable method of calculating damages.


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