That, if this Commission be notified by the Public Service Commission of West Virginia within 30 days from the date of service of this order that it will promptly permit application of the increases required to remove the unlawfulness found to exist, this order shall be void.

355 I.C.C.

No. 36466

THERMOFIL, INC. v. JONES TRANSFER COMPANY,
ET AL.

Decided October 28, 1977

Detention charges assessed by defendant on trailers owned or leased by the Chesapeake and Ohio Railroad and used in plan II 1/2 TOFC movements, found to be unjust and unreasonable in the absence of an interchange agreement between motor and rail carriers. Proceeding discontinued.

Robert E. McFarland for complainant.

John W. Bryant for defendant, Jones Transfer Company. John J. Holden for defendant, The Chesapeake & Ohio Rail Company.

REPORT OF THE COMMISSION

DIVISION 2, COMMISSIONERS MURPHY, MACFARLAND, AND CLAPP

BY DIVISION 2:

The modified procedure was followed. Exceptions to the initial decision of the Administrative Law Judge were filed by defendant Jones Transfer Company (Jones). Complainant Thermofil, Inc. (Thermofil) and defendant Chesapeake & Ohio Railroad Company (C & O) filed replies. Our conclusions differ in part from those recommended in the initial decision. Exceptions and requested findings not specifically discussed in this report nor reflected in our findings or conclusions have been considered and found not justified or not necessary for the proper disposition of this proceeding. The facts are restated and expanded only as necessary for a proper understanding and resolution of the issues on exception.

By complaint dated September 24, 1976, Thermofil alleged that detention charges assessed by defendant Jones were either inapplicable, in violation of section 217(b) of the Interstate Commerce Act, or unjust and unreasonable, in violation of section

216(b) of the act.' In the event that Jones' detention charges were held lawful, alternative relief was sought against the C & O because it assessed detention contemporaneously with the motor carrier detention charges.

The detention charges in issue arise out of the shipment of numerous truckloads of plastic to complainant Thermofil's Ypsilanti, Mich., plant. Between April 26 and September 19, 1974, Thermofil was assessed $7,599.72 in detention charges by the C & O and $6,542.38 in separate detention charges by Jones. All these charges were paid by complainant. New charges were incurred on shipments moved between August 20 and September 19, 1974. Thermofil paid the detention charges on these shipments as sought by the C&O but refused to pay the detention charges sought by Jones, which amounted to $4,108.92 and are here in dispute. Additionally, Thermofil declined to pay the transportation charges due to Jones on these shipments, amounting to $2,454.29, apparently as a set off against detention charges it believed Jones collected unlawfully.

All of the shipment involved were moved by the C & O in railroad-owned trailers in rail trailer-on-flatcar (TOFC) service (plan II 1/2) under railroad rate tariffs, from Nashville, Tenn., to the C & O yard at Detroit, Mich. The trailers were transported to the shipper's plant at Ypsilanti for unloading, and back to the C & O ramp at Detroit, by Jones.

As the Administrative Law Judge observed, the key to the problem is that Jones failed to renew an interchange agreement with the C & O governing the interchange of trailers between the two carriers. This agreement was canceled by the railroad on February 28, 1974, prior to all the movements here in question. Jones allegedly objected to increased per diem charges and an increased insurance coverage requirement proposed by the C & O. Consequently, Jones' use of the trailers was governed by terms of the C & O receipt forms which Jones signed upon picking up the trailers at the C & O ramp in Detroit. By terms in those receipts, Jones could not use the trailers other than in the C & O's TOFC service.

In his initial decision, the Administrative Law Judge found that because the cancellation of a master interchange agreement between Jones and the C & O had occurred prior to the movements

'This proceeding has been referred to the Commission by the United. States District Court (Eastern District, Michigan) for determination of the lawfully applicable tariff provisions in connection with a civil action filed by Jones to collect allegedly unpaid transportation charges.

not

in question, the motor carrier tariff, relied upon the Jones to assess detention charges against the shipper (Thermofil) was applicable. The Administrative Law Judge reasoned that these were rail movements and that the C & O's tariff, which required that an interchange agreement be in effect before the motor carrier detention rules could apply, was controlling; that in the absence of such an agreement, Jones acted merely as the agent of the consignee, Thermofil, to effect delivery; and that, under these circumstances, the assessment of detention by Jones would result in double billing and constitute an unreasonable practice on the part of the motor carrier. Jones' contention that it had individual interchange agreements for each trailer with the C & O was rejected. The Administrative Law Judge also concluded that the C & O was entitled to assess any and all applicable detention charges. On exceptions, Jones contests the finding that its tariff' was inapplicable to the rail piggyback movements in question. Jones asserts that item I of that tariff specifically adopted the detention provisions contained in the rules tariff of Central States Motor Freight Bureau, Inc., Agent, ICC-CMB-100, and that nowhere does tariff 208A refer to, or require that, a master interchange agreement be in effect between the railroad and motor carrier as a condition precedent to assessment of motor carrier detention. Jones argues that the prior railroad movement of the trailers from Nashville to C & O's Detroit yard ramp-to-ramp plan II 1/2 TOFC service cannot void the unambiguous detention provisions of the applicable motor carrier tariff on transportation between Detroit and Thermofil's Ypsilanti plant. It contends that a finding that the motor carrier tariff provisions are inapplicable cannot be based on interpretation of a rail tariff provision." Jones argues that motor carriers clearly have the right to assess detention charges, that Jones could not participate in the issue movements without proper operating authority under part II of the act, and that it is, therefore, Jones' motor common carrier status, rather than any agency relationship between it and Thermofil, which gives rise to its right to assess detention charges here. It contends that there is no reason why the rail and motor carrier detention provisions cannot be read together to permit the imposition of detention charges by each.

'Central States Motor Freight Bureau, Inc., Agent, Tariff ICC-CMB-208A, entitled "Prior or Subsequent Rail Piggy Back Commodity Tariff.”

'Item 570A of E. F. Baughan, Agent, Freight Tariff 1, ICC 317, provides that where an interchange agreement is in effect, existing motor carrier detention charges will be applied after the motor carrier receives the shipment from the rail carrier.

Jones sees the primary issue as being the reasonableness of its detention charges and contends that the record does not support a finding that such an assessment is an unjust or unreasonable practice.

It maintains that neither railroad ownership of the trailers nor the existence of an interchange agreement between motor and rail carriers is relevant to the reasonableness of motor carrier detention. On the contrary, Jones contends that assessment of motor carrier detention is justified by its potential liability for loss or damage of the railroad-owned trailers under its control, by the general policy of promoting efficient use and ready availability of such vehicles to the shipping public, and by its need to maintain a favorable operating balance between its terminals.

Jones believes that it would be unwise to base a determination of unreasonableness on the nonexistence of a master interchange agreement between itself and the C & O. It construes the C & O's Pickup/Delivery Service Time and Trailer Inspection Report B & O-C & O Form PB-215C (hereinafter "the C & O form"), which it signed for each trailer tendered it by the C & O, as individual interchange agreements." Jones, therefore, urges that even if the existence of an interchange agrement should be found generally relevant to the issue of reasonableness, the outcome of this proceeding should not be affected.

Jones argues that assessment of a double detention charge is not unreasonable per se, and that a motor carrier participating in plan II 1/2 service may charge detention over and above the railroad detention charge. In the alternative, Jones urges that the assessment of rail detention charges is unreasonable under these circumstances. In reply, Thermofil supports the Administrative Law Judge's finding that Jones' detention tariff is inapplicable. Thermofil contends that the fact that a motor carrier must possess operating authority to perform scrvices in connection with a rail TOFC movement and publish charges for such service does not necessarily mean that it may assess detention charges. It argues that Jones' tariff permits a charge only where motor carrier service is provided, and

'In this regard, Jones notes that whereas C & O's detention charges are only $10.60 per day, it charges are $16.79 for the first day, $22.38 for the second day, and $33.58 for each additional day. Jones claims its larger charges more strongly discourage shipper delay in unloading. 'According to Jones, the only difference between a master interchange agreement and the C & O form is that the latter does not include provision for a per diem payment for use of the C & O trailers.

"Item 20(g) of Central States Motor Freight Bureau, Inc., Agent, Tariff ICC-CMB-208A provides that: "all rates and charges applicable to the service performed by motor carriers party to this tariff are in addition to the applicable rates and charges of the rail carrier."