[Title 32 CFR 751.12]
[Code of Federal Regulations (annual edition) - July 1, 2002 Edition]
[Title 32 - NATIONAL DEFENSE]
[Subtitle A - Department of Defense (Continued)]
[Chapter Vi - DEPARTMENT OF THE NAVY]
[Subchapter E - CLAIMS]
[Part 751 - PERSONNEL CLAIMS REGULATIONS]
[Subpart A - Claims Against the United States]
[Sec. 751.12 - Computation of award.]
[From the U.S. Government Printing Office]


32NATIONAL DEFENSE52002-07-012002-07-01false751.12Sec. 751.12NATIONAL DEFENSEDepartment of Defense (Continued)DEPARTMENT OF THE NAVYCLAIMSPERSONNEL CLAIMS REGULATIONSClaims Against the United States
Sec. 751.12  Computation of award.

    The Judge Advocate General will periodically publish an Allowance 
List-Depreciation Guide specifying rates of depreciation and maximum 
payments applicable to categories of property. The Allowance List-
Depreciation Guide will be binding on all DON claims personnel. The 
value of the loss is determined and adjusted to reflect payments, 
repairs, or replacement by carriers or insurers, or lost potential 
insurance or carrier recoveries.
    (a) Repair of items. For items that can be economically repaired, 
the cost of repair or an appropriate loss in value is the measure of the 
loss. The cost of repair may be the actual cost, as demonstrated by a 
paid bill, or reasonable estimated costs, as demonstrated by an estimate 
of repair prepared by a person in the business of repairing that type of 
property.
    (1) Loss of value (LOV)--(i) Minor damage not worth repairing. An 
LOV, rather than replacement cost, should be awarded when an item 
suffers minor

[[Page 415]]

damage that is not economical to repair but the item remains useful for 
its intended purpose. An LOV is particularly appropriate when the item 
is not of great value and has preexisting damage (PED). An LOV is also 
appropriate to compensate claimants for minor damage, such as a chip or 
surface crack to a figure or knickknack. For example, if an inexpensive, 
fiberboard coffee table with extensive PED is scratched, repair of the 
scratch would exceed the value of the table. Under the circumstances, 
LOV is appropriate.
    (ii) Damage to upholstered furniture. If damage can be repaired 
imperceptibly by cleaning or reweaving, the claimant is only entitled to 
repair cost. If repairs would be somewhat noticeable but the damage is 
to an area not normally seen, repair costs plus an LOV would be 
appropriate. Alternatively, if repairs would be somewhat noticeable but 
the item is of no great value and has already suffered PED, repair costs 
and LOV would be appropriate even if the damage is in an obvious area. 
If, however, repairs would be so noticeable as to destroy the usefulness 
of the item, the item should be reupholstered or replaced. What is 
noticeable will depend on the nature and value of the item, and the 
nature of the damage, and claims personnel should exercise sound 
judgment to avoid being too lenient or too harsh.
    (iii) Cosmetic damage to nondecorative items. LOV should also be 
awarded to compensate claimants for cosmetic damage to items that were 
not purchased for purposes of display or decoration. For example, the 
casing of a washing machine is dented. The washing machine is not 
decorative in nature and still functions perfectly. An LOV, rather than 
replacement of the washing machine or the casing, is the appropriate 
measure of the claimant's loss.
    (2) PED to repairable items. PED is damage to an item that predates 
the incident giving rise to a claim. PED is most commonly identified by 
the use of symbols on household goods shipment inventories. Whenever PED 
is listed on an inventory, claims personnel must determine whether the 
PED did in fact exist and whether the cost of repairing the item 
includes repairing PED. The fact that a claimant signed the inventory 
that listed PED is conclusive evidence that PED did exist unless the 
member has taken written exceptions on the inventory to the carrier's 
description of PED. These findings are essential for recovery purposes. 
Often inspecting the item or calling the repairman who prepared the 
estimate is the only way to make an effective determination.
    (i) Estimates that do not include repair of PED. If the estimate 
does not include repair of PED, even if PED is listed on the inventory, 
no deduction should be made. This fact should be recorded on the 
chronology sheet and on carrier recovery documents.
    (ii) Estimates that include repair of PED. If repair of PED is 
included in the estimate, the percentage attributable to repair of PED 
is deducted.
    (3) Mechanical defects. The Personnel Claims Act only provides 
compensation for losses incurred incident to service. Damage resulting 
from a manufacturer's defect or from normal wear and tear is not 
compensable. Damage to the engine or transmission of an old vehicle 
during shipment is probably due to a mechanical defect. Internal damage 
to appliances, such as old televisions, is also often due to a 
mechanical defect, particularly when their is no external damage to the 
item. Claims for internal damage to small appliances that are not 
normally repaired, such as toasters or hair dryers, should be assessed 
based on damage to other items in the carton and the shipment, the age 
of the item, the honesty of the claimant, and whether there are loose 
parts inside. If the evidence suggests rough handling caused the damage, 
a claim for the item should be paid. Internal damage to larger items 
such as televisions or stereos should be evaluated by a repairman. 
Evidence that suggests rough handling, such as smashed boards, provides 
a basis for payment. Evidence that suggests a fault in the item, such as 
burned-out circuits, does not. Deterioration because an item in storage 
was not used for a long time, rather than because the item was 
mishandled or the conditions of storage were improper, is also 
considered due to a mechanical defect.

[[Page 416]]

    (4) Wrinkled clothing. Clothing wrinkled in shipment presents 
special problems. Normally, unless the wrinkling is so severe as to 
amount to actual damage, the cost to press wrinkles out of clothing 
after a move is not compensable. The mere fact that clothing was 
``wadded up'' or ``used as packing material'' is not in itself 
sufficient. The wrinkling must be such that professional pressing is 
necessary to make the clothing usable. This determination will depend on 
the wrinkling and the nature of the material.
    (5) Wet and mildewed items. A claimant has a duty to mitigate 
damages by drying wet items to prevent further deterioration. Items that 
have been wet are not necessarily damaged and claimants who throw them 
away have difficulty substantiating that a loss has occurred. Although a 
deeply seated mildew infestation is almost impossible to remove 
completely, items lightly infested can often be cleaned.
    (b) Replacement of items. A claimant is entitled to the value of 
missing and destroyed items. An item that has sustained damage is 
considered destroyed if it is no longer useful for its intended purpose 
and the cost of repairing it exceeds its value. Value is measured in the 
following ways:
    (1) Similar used items. If there is a regular market for used items 
of that particular type, the loss may be measured by the cost of a 
similar item of similar age. Prices obtained from industry guides or 
estimates from dealers in this type of property are acceptable to 
establish value. There is a regular market on used cars and the value of 
a used automobile is always measured according to the N.A.D.A. Official 
Car Guide rather than the depreciated replacement cost. Similarly, the 
Mobile Home Manufactured Housing Replacement Guide may be used to value 
a destroyed mobile home. Where there is no regular market in a 
particular type of used item, however, estimates from dealers in 
``collector's items'' should be avoided.
    (2) Depreciated replacement cost. This is the normal measure of a 
claimant's loss. A catalog or store price for a new item similar in size 
and quality is depreciated using the Allowance List-Depreciation Guide 
to reflect wear and tear on the missing or destroyed item. The 
replacement cost for identical items--particularly decorative items--
should be used whenever the item is readily available in the local area, 
but a claimant who is eligible to use the Navy Exchange (NEX) and the 
NEX Mail Order Catalog should not be allowed a higher replacement cost 
of an item, such as a television, from a specialty store when the NEX 
carries an item comparable in size, quality, and features from another 
manufacturer.
    (3) ``Fair and reasonable'' (F&R) awards. A fair and reasonable 
award should be used sparingly when other measures would compensate the 
claimant appropriately. Overuse of such awards impedes carrier recovery 
and ``F&R'' should never be used when a more precise measure of damages 
is available. An F&R award for a missing or destroyed item should 
reflect the value of an item similar in quality, description, age, 
condition, and function to the greatest extent possible. An F&R award 
for a damaged item should reflect either the amount a firm would charge 
for repair or the reduced value to the greatest extent possible. 
Whenever such an award is made, the basis for the award should be 
explained on the chronology sheet, in the comments block of DD Form 1844 
(List of Property), or in a separate memorandum. A fair and reasonable 
award may be considered in the following instances:
    (i) The item is obsolete and a simple deduction of a percentage for 
obsolescence is not appropriate.
    (ii) The claimant cannot replace the item in the local area.
    (iii) The claimant cannot replace the item at any cost.
    (iv) Repair costs or replacement costs are excessive for the item 
and an LOV is not appropriate.
    (v) The claimant has substantiated a loss in some amount but has 
failed to substantiate a loss in the amount claimed.
    (c) Depreciation. The Personnel Claims Act is only intended to 
compensate claimants for the fair market value of their loss. Except in 
unusual cases, a used item that has been lost or destroyed is worth less 
than a new item of the same type. The price of a

[[Page 417]]

new replacement item must be depreciated to award the claimant the value 
of the lost or destroyed item. Average yearly and flat rates of 
depreciation have been established to determine the fair value of used 
property in various categories. These rates are listed in the Allowance-
List Depreciation Guide. The listed depreciation rate should be adjusted 
if an item has been subjected to greater or lesser wear and tear than 
normal or if the replacement cost the claimant provides is for a used 
item rather than a new one. Yearly depreciation is not taken during 
periods of storage and normally no depreciation is taken on repair costs 
or on replacement cost for items less than 6 months old, excluding the 
month of purchase and the month the claim accrued (but see 
Sec. 751.12(c)(3)).
    (1) Depreciating replacement parts. No depreciation should be taken 
on replacement parts for damaged items unless these are parts separately 
purchased or normally replaced during the useful life of these items. 
The replacement cost for these latter items should be depreciated. For 
example, the glass top to a table is not normally replaced during the 
useful life of the table and should not be depreciated.
    (2) Depreciating fabric for reupholstery. Fabric is normally 
replaced during the useful life of upholstered furniture. When 
upholstered furniture is reupholstered because the damage is too severe 
to be repaired and an LOV is not appropriate, the cost of new fabric is 
depreciated at a rate of 5 percent per year. If the item has been 
reupholstered since it was purchased, depreciation is measured from the 
date the item was last reupholstered, rather than from the date the item 
was originally purchased. Labor costs are allowed as claimed. If the 
estimate does not list separate costs for fabric and labor, the labor 
costs may be assumed to be 50 percent of the total bill.
    (3) Rapidly depreciating items. Tires, most clothing items, and most 
toys rapidly lose their value, as the high depreciation rate for these 
items reflects. Depreciation should be taken on such items even when 
they are less than 6 months old. As a rule of thumb, half of the normal 
yearly or flat rate depreciation should be taken on such items when they 
are between 3 and 6 months old at the time of loss.
    (4) Obsolescence. Even though depreciation is not taken during 
periods of storage, obsolescence should be claimed on those items that 
have lost value because of changes in style or technological 
innovations.
    (5) Military uniforms. Normally, no depreciation should be taken on 
military uniforms. Depreciation, however, should be taken on military 
uniform items that are being phased out or that belong to persons 
separating from the service. Socks and underwear are not considered 
military uniform items.
    (d) Salvage value. Whenever a claimant has been fully compensated 
for a destroyed item that still has some value, the claimant has the 
option of either retaining the item and having the claims office deduct 
an amount for the salvage value, or turning the item over to the 
Government or to the carrier if the carrier will fully reimburse the 
Government.
    (1) Turn-in to the Government. On all claims, except CONUS domestic 
shipments, if the claimant does not choose to retain the items and 
accepts a reduction in the amount paid on the claim for salvage value, 
the claims office will require the claimant to turn them into a disposal 
unit designated by the Personal Property Office. Normally, the amount 
that the Government may obtain from selling such items is very low. If 
the claims office determines that the salvage value is less than $25.00, 
the claimant may be advised to dispose of the items by other means, 
either by throwing the item away or by turning it over to a charitable 
organization. Claimants may also be directed to make alternative 
disposition of items that have been refused by the designated disposal 
unit. This alternate disposition must be noted on the chronology sheet 
that is kept as part of the claims file. Claims personnel will not 
divert such items to personal use or use them to furnish Government 
offices. In determining whether an item has salvage value, the size of 
the item and the distance the claimant must travel to turn it in should 
be considered. A claimant must

[[Page 418]]

make his own arrangements to transport salvageable items prior to 
payment. Claims personnel should ask the claimant's command to make 
transportation available to assist the claimant in appropriate cases, 
particularly when the item is large or bulky. Sound discretion prohibits 
requiring a claimant living far from a designated disposal unit to turn 
in an item of relatively slight value.
    (2) Turn-in to the carrier. On CONUS domestic shipments, the carrier 
may choose to pick up items for which it will fully reimburse the 
Government. Pursuant to a Joint Military-Industry Memorandum on Salvage, 
items that are hazardous to keep around, such as mildewed items or 
broken glass (except items such as figurines and crystal with a per item 
value of more than $50.00), may be disposed of as the claimant chooses. 
Claimants must retain other items for a maximum of 120 days from the 
date of delivery to allow the carrier to pick them up. Pursuant to this 
memorandum of understanding, the carrier has until the end of the 
inspection period or 30 days after receipt of the demand, whichever is 
greater, to identify such items. Claims offices must identify files in 
which the carrier is entitled to salvage and must process these claims 
for recovery action within 30 days so that the claimant does not dispose 
of salvageable items before the end of the period allotted for carrier 
pick-up.
    (3) Maximum allowances. If the claimant will not be fully 
compensated for an item because a maximum allowance is applied, he will 
not be required to turn in the item.
    (e) Standard abbreviations. The claims examiner's intent should be 
clear and unmistakable to anyone reviewing the remarks section of DD 
Form 1844. The following standardized abbreviations are used in 
completing the remarks section. Other abbreviations should not be used. 
Whenever one or more of these abbreviations will not adequately explain 
how the claimant has been compensated, a brief explanation should be 
inserted in the remarks section, in the comments section on the bottom 
of DD Form 1844, or on the chronology sheet that is kept in each claims 
file.
    (1) AC: Amount claimed. The amount claimed was awarded to the 
claimant. This abbreviation is not used if the claimant has presented an 
estimate of repair.
    (2) AGC: Agreed cost of repairs. The claimant did not present an 
estimate but instead, after discussing the matter with claims personnel, 
entered an amount that represents the claimant's guess as to how much it 
would cost to repair the damaged item. The claims office may accept this 
amount as a fair estimation of the cost of repair based on the amount of 
damage, the value of the item, and the cost of similar repairs in the 
area. A claimant may be allowed up to $50.00 as an AGC without an 
inspection and between $50.00 and $100.00 if claims personnel have 
inspected the item. The use of AGC is an integral part of small claims 
procedures.
    (3) CR: Carrier recovery. The claimant was paid this amount by the 
carrier for the item. The payment is recorded in the remarks column, and 
the total carrier payment is deducted at the bottom of DD Form 1844 in 
the same manner as insurance recovery.
    (4) D: Depreciation. Yearly depreciation was taken on the destroyed 
or missing item in accordance with the appropriate depreciation guide in 
effect at the time of the loss. Deviations from standard rates must be 
explained.
    (5) DV: Depreciated value. A claimant's repair costs exceeded the 
value of the item, so the depreciated value was awarded instead. 
Whenever a claimant claims a repair cost that is very high, relative to 
the age and probable replacement cost, the replacement cost should be 
obtained and the depreciated value determined.
    (6) ER: Estimate of repair. The claimant provided an estimate of 
repair that was used to value the loss. If multiple estimates were 
provided, they should be numbered and referred to as exhibits.
    (7) EX: Exhibit. When numerous documents have been provided to 
substantiate a claim, they should be numbered and referred to as 
exhibits.
    (8) FR: Flat rate depreciation. Flat rate depreciation was taken on 
an item in accordance with the Depreciation Guide in effect at the time 
of the loss.

[[Page 419]]

Deviations from the normal rate must be explained.
    (9) F&R: Fair and reasonable. A fair and reasonable award was made 
(see Sec. 751.12(b)(3)).
    (10) LOV: Loss of value. An LOV was awarded (see Sec. 751.5(a)(1)).
    (11) MA: Maximum allowance. The adjudicated value, listed in the 
``Amount Allowed'' column, exceeds a maximum allowance. The amount in 
excess of the maximum allowance is subtracted at the bottom of the DD 
Form 1844.
    (12) N/P: Not payable. The item is not payable. The reason for this 
comment should be noted (i.e., ``not substantiated'').
    (13) OBS: Obsolescence. A percentage was deducted for obsolescence.
    (14) PCR: Lost potential carrier recovery. A deduction was made for 
lost PCR.
    (15) PED: Preexisting damage. A deduction was made for PED.
    (16) PP: Purchase price. The purchase price was used to value the 
loss. Normally, the purchase price is not an adequate measure of the 
claimant's loss. If, however, the claimant used the replacement cost of 
a dissimilar item or otherwise failed to substantiate the replacement 
cost, a recent purchase price may be used at the discretion of claims 
personnel, if a true replacement cost is not available.
    (17) NEX: Navy Exchange replacement cost. A replacement from the NEX 
was used.
    (18) RC: Replacement cost. A replacement cost was used. The store or 
catalog from which the replacement cost was taken should be listed.
    (19) SV/N: Item has no salvage value. A destroyed item was 
determined to have no salvage value.
    (20) SV/R: Salvage value, item retained. A destroyed item was 
determined to have salvage value and the claimant chose to keep the 
item. Accordingly, a deduction was made for the salvage value.
    (21) SV/T: Salvage value, item turned in. A destroyed item was 
determined to have salvage value and the claimant chose not to keep the 
item. If the item is part of a CONUS domestic shipment, the claimant 
must keep it for the carrier to pick up. Otherwise, the claimant must 
turn the item in prior to payment on the claim.
    (f) Sets. Normally, when component parts of a set are missing or 
destroyed, the claimant is only entitled to the replacement cost of the 
missing or destroyed components. In some instances, however, a claimant 
would be entitled to replacement of the entire set or to an additional 
LOV. Some claimants will assert that all of the items in a room are part 
of a set. Pieces sold separately, however, are ordinarily not considered 
parts of a set, and pieces that merely complement other items, such as a 
loveseat purchased to complement a particular hutch, are never 
considered part of a set. When a component part of a set is missing or 
destroyed and cannot be replaced with a matching item, or has to be 
repaired so that it no longer matches other component parts of the set, 
the following rules apply:
    (1) The set is no longer useful for its intended purpose. When a set 
is no longer useful for its intended purpose because component parts are 
missing or destroyed the entire set may be replaced. Note that several 
firms will match discontinued sets of china and crystal and that 
replacement of the set is not authorized if replacement items can be 
thus obtained. Generally, with china and crystal the value of the set as 
a whole is not destroyed unless more than 25 percent of the place 
settings are unusable. Exceptions may be made if the claimant can 
demonstrate a particular need for a certain number of place settings 
because of family size or social obligations. In those rare instances 
when an entire set is replaced, the claimant will be required to turn in 
undamaged pieces.
    (2) The set is still useful for its intended purpose. When missing 
pieces cannot be matched and there is measurable decrease in the value 
of the set, but the set is still useful for its intended purpose, the 
claimant is awarded the value of the missing pieces plus an amount for 
the diminution in value of the set as a whole. The amount awarded as an 
LOV will vary depending on the exact circumstances.
    (3) Mattresses and upholstered furniture are recovered. A mattress 
and box spring set is covered during normal

[[Page 420]]

use. Such sets are still useful for their intended purpose if one piece 
of the set has to be recovered in a different fabric. No award will be 
made for the undamaged piece. When one piece of a set of upholstered 
furniture suffers damage that cannot be repaired or recovered in 
matching fabric, recovering the entire set or recovering the damaged 
piece plus LOV should be considered. Factors to take into account 
include the value of the set, PED to the set, the nature of the current 
damage, and the extent to which the claimant's furniture is already 
mismatched.
    (g) Mobile homes. Mobile homes present special problems. Most mobile 
homes, particularly larger ones, are not built to withstand the stress 
of multiple long moves. While the Mobile Home One-Time Only rate 
solicitation program, effective 1 November 1987, may have reduced the 
incidence of loss and damage by encouraging carriers to use extra axles 
when necessary, mobile home shipments can result in enormous, 
uncompensated losses for servicemembers and present unusual difficulties 
for claims adjudicators. Because the risk is so great, claims offices 
must coordinate with their servicing transportation offices to ensure 
both that servicemembers shipping mobile homes are advised of the risk 
and of their responsibilities, and that the transportation office does 
not authorize shipment of a mobile home that has not been placed in a 
fit condition to be shipped.
    (1) Transportation counseling prior to shipment. Servicemembers 
should be advised of the following:
    (i) They are responsible for placing the mobile home and its tires, 
tubes, frames, and other parts in fit condition to ship and for loading 
the mobile home to withstand the stresses of normal transportation. They 
will not be compensated for any damage that results either from a latent 
defect in the construction of the mobile home (except when the carrier 
is aware of the defect and the servicemember is not) or from their 
failure to place the mobile home in fit condition to ship.
    (ii) They are responsible for paying for necessary repairs en route. 
Such repairs can amount to several hundred or even several thousand 
dollars, and some mobile homes have been left in storage at the 
servicemember's expense hundreds of miles from destination because the 
owner could not pay for necessary repairs.
    (iii) They are responsible for resealing the roof and 
weatherproofing the mobile home after delivery. The cost of this is not 
compensable, nor is any damage caused by the servicemember's failure to 
have it done.
    (iv) They are responsible for removing obstructions, grading the 
roadway, or otherwise preparing the site to make it accessible for the 
carrier's equipment at both origin and destination.
    (v) Because of the risk that damage will result for which they 
cannot be compensated, servicemembers should strongly consider 
purchasing private insurance coverage. A claimant usually must purchase 
separate insurance for property shipped inside the mobile home and most 
mobile home carriers will sell some sort of insurance coverage for 
damage to the mobile home itself. Often, when a mobile home has been 
moved repeatedly, the risk of uncompensated loss is so high that the 
servicemember should consider selling the home rather than attempting to 
ship it.
    (2) Inspection Prior to Shipment. Transportation personnel should 
inspect the home prior to shipment in all instances. All defects should 
be recorded. In particular:
    (i) A mobile home should not be shipped with a servicemember's 
furniture and other household goods inside. The maximum safe weight of 
appliances and additional property is very low. An overweight mobile 
home tends to blow tires and break apart during shipment. Servicemembers 
should be advised long before shipment that they will have to make other 
arrangements for shipping such items at their own expense.
    (ii) A mobile home should never be shipped with defects in the steel 
frame or tow hitch.
    (iii) The condition of all tires should be checked and recorded. 
Some carriers submit huge bills for ``blown'' tires during shipment.
    (iv) Structural changes to the interior of the home, particularly 
those

[[Page 421]]

that involve cutting through beams, should be examined closely and a 
civil engineer should be called in to render an opinion. Frequently, it 
is not safe to ship mobile homes in which the claimant has altered the 
interior framing.
    (3) Latent Defects. Many carriers will attempt to escape liability 
by attributing all damage to latent manufacturing defects. A loss due to 
such a defect, like a loss due to any other mechanical defect, is not 
considered incident to service. When an engineer's report or other 
evidence shows that damage was indeed caused by a defect rather than by 
the carrier's failure to take the necessary care, the following rules 
apply:
    (i) If both the carrier and the claimant knew or should have known 
of the defect, and if the claimant took no corrective action and had the 
mobile home shipped anyway, the claim is not payable.
    (ii) If the carrier knew or should have known of the defect, and the 
claimant could not reasonably have been expected to know of it, the 
claim is payable and liability should be pursued against the carrier.
    (iii) If neither the claimant nor the carrier could reasonably be 
expected to know of the defect, the claim is not payable.
    (4) Substantiation of a claim. Prior to adjudication of such claims, 
the mobile home should be inspected and the following evidence obtained, 
if possible:
    (i) DD Form 1800 (Mobile Home Shipment Inspection at Destination). 
This document shows the condition of the home at origin prior to 
shipment. This document is prepared by the Transportation Office (TO) 
and is signed by the servicemember, the carrier's representative, and 
the Government inspector. It is vital and a claim should not be paid 
without it. At destination, damages noted at delivery should be 
annotated and the form dated and signed by the driver and the 
servicemember. Damages may be listed on this form or on the DD Form 1840 
(Joint Statement of Loss or Damage at Delivery).
    (ii) DD Form 1863 (Accessorial Services-Mobile Home). For shipments 
after 1 November 1987, DD Form 1863 lists all services the carrier is 
required to provide, including line-haul, payment of tolls, 
overdimension charges, permits and licenses, provision of anti-sway 
devices, axles with wheels and tires, temporary lights, and escort 
services. All costs and services may not appear on the GBL. For 
shipments prior to 1 November 1987, damages may also be listed on this 
form.
    (iii) DD Form 1840/1840R. Beginning 1 November 1987, later-
discovered damages must be listed on DD Form 1840R and dispatched to the 
carrier within 75 days of delivery. Timely notice on mobile home 
shipments differs slightly from such notice on other shipments. Item 306 
of the carrier's rate solicitation provides that ``upon delivery by the 
carrier, all loss of or damage to the mobile home shall be noted on the 
delivery document, the inventory form, the DD Form 1800, and/or the DD 
Form 1840. Late discovered loss or damage, including personal property 
within the mobile home, will be noted on the DD Form 1840R not later 
than 75 days following delivery and shall be accepted by the carrier as 
overcoming the presumption of correctness of delivery receipt.''
    (iv) DD Form 1412 (Inventory of Items Shipped in Housetrailer). 
Prior to 1 November 1987, the servicemember prepared DD Form 1412. After 
1 November 1987, the carrier is required to prepare this in coordination 
with the servicemember.
    (v) DD Form 1841. If a Government representative does not inspect 
the mobile home at delivery, an inspection should be requested.
    (vi) Driver's statement. The mobile home carrier should be requested 
to provide (within 14 days) a statement from the driver of the towing 
vehicle explaining the circumstances surrounding the damage as well as 
detailed travel particulars. If the mobile home carrier does not 
respond, the file should be so annotated. Such statements are often 
self-serving and should be reviewed critically to determine whether the 
carrier is attributing damage to a latent defect.
    (vii) Owner's statement. The claimant should provide a statement 
concerning the age of the mobile home, the date and place purchased, any 
prior damage or repairs, all prior moves, and prior claims.

[[Page 422]]

    (viii) Estimates of repair. When possible, the claimant should 
obtain two estimates of repair from firms in the business of repairing, 
rather than selling, mobile homes. Such estimates should list the 
approximate value of the home before and after damage, a detailed 
breakdown of the repairs needed and their cost, and the cause of damage.
    (ix) Engineer's statement. Where the facts indicate the possibility 
of a latent defect, the claimant should be assisted in obtaining a 
statement from a qualified engineer or vehicle maintenance professional 
with expertise in mobile homes explaining the cause of damage. The 
claims office should coordinate in advance with facilities engineers or 
with local reserve units with engineering expertise to provide such 
inspection where possible.
    (5) Compensable damage. In adjudicating the claim, the claimant may 
be paid for loss of or damage to the mobile home except when the damage 
is due to a latent defect, to the servicemember's failure to place the 
home in fit condition to ship, or to the servicemember's failure to have 
the roof resealed. The servicemember may also be compensated for the 
reasonable cost of repair estimates provided by firms in the business of 
mobile home repair and of opinions prepared by qualified engineers. The 
claimant may not be compensated for services the carrier failed to 
perform or performed improperly or for other incidental expenses. The 
claimant should be referred to the transportation office for these. Such 
services (listed on DD Form 1843 and the GBL correction notice) include:
    (i) Escort or pilot services, ferry fees, tolls, permits, 
overdimension charges, or taxes.
    (ii) Storage costs or parking fees en route.
    (iii) Expand charges and charges for anti-sway devices, brakes and 
brake repairs, or adding or replacing axles, tubes, or tires.
    (iv) Wrecker service.
    (v)Connecting or disconnecting utilities.
    (vi) Blocking, unblocking, or removing or installing skirting.
    (vii) The cost of separating or reassembling and resealing a double-
wide mobile home.
    (6) Carrier liability and attempted waivers. In the absence of 
additional coverage, the carrier's maximum liability for personal 
property shipped with the mobile home is $250.00. The carrier is fully 
liable for damages to the mobile home itself. Carriers are also liable 
for damage caused by third parties with whom they contract, such as 
wrecker services. Some carriers may still try to obtain waivers, from 
the servicemember. A waiver signed by the servicemember, however, is not 
binding on the United States. The Navy is the contracting party and the 
owner has not authority to sign a waiver agreement or any other document 
purporting to exempt the carrier from the liability imposed under the 
GBL.