BNUMBER:  B-270469
DATE:  May 29, 1996
TITLE:  Andrews Van Lines, Inc.

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Matter of:Andrews Van Lines, Inc.

File:     B-270469

Date:May 29, 1996

DIGEST

1.  A carrier is entitled to a partial refund of an amount setoff for 
damage to a dining table where the agency incorrectly applied a 
depreciated rate of 50 percent of the replacement value to compute the 
setoff amount, instead of using the maximum depreciation rate of 75 
percent, as required by its own depreciation guide for a 20-year-old 
wooden furniture piece. 

2.  A shipper establishes a prima facie case of carrier liability for 
damage to the shipper's property by showing tender of the property to 
the carrier, delivery in a more damaged condition, and the amount of 
the damages.  Thereafter, the carrier has the burden of proving that 
it was free from negligence and that an excepted cause was the sole 
cause of the damage.  Thus, a carrier that merely offers its 
conclusion based on an inspection that the damage was not 
transit-related has not met its burden when the carrier's inventory 
sheet does not list the damage as preexisting damage, and the 
carrier's rider, prepared when the carrier removed the items from 
storage, likewise does not list the damage. 

DECISION

Andrews Van Lines appeals our Claims Settlement Z-2729037-128, of 
October 12, 1995, denying its request for a refund.[1]  The settlement 
involved offsets taken by the Department of the Army against Andrews 
for losses or damage to various items of household goods shipped by 
Elwood Tauscher under GBL No. SP-027,530.[2]  Of the $1,415 amount 
offset, Andrews requested a refund of $1,037.46, but the Army only 
allowed $85.  Andrews claims the remaining $952.46, not allowed.  As 
discussed below, Andrews is entitled to an additional refund of 
$411.98.

The first offset item Andrews disputes is a dining table listed on the 
shipment inventory sheet as item No. 32.  The offset was $813, for 
damage to the fiber core veneered table top which caused the table to 
be useless.  Andrews argues that its agent inspected the table and 
concluded that the damage did not occur during transit but was due to 
climatic conditions.  Andrews argues that the Army accepted a similar 
conclusion by Andrews in connection with item No. 10 on the inventory 
sheet, a piano, and that the Army should also accept its conclusion as 
to item No. 32, in order to be consistent.

In response, the Army argues that the only preexisting damage to the 
table noted by Andrew on the inventory sheet was some scratching and 
marring, and that Andrews took no exceptions to this item on the rider 
when it picked up the shipment from nontemporary storage.  

A shipper establishes a prima facie case of carrier liability for 
damage to the shipper's property by showing tender of the property to 
the carrier, delivery in a more damaged condition, and the amount of 
the damages.  Thereafter, the carrier has the burden of proving that 
it was free from negligence and that an accepted cause was the sole 
cause of the damage.  McNamara-Lunz Vans and Warehouses, Inc., 57 
Comp. Gen. 415 (1978). 

Here, Andrews has only offered in evidence its conclusion that the 
damage to the table was preexisting.  As the Army notes, there is no 
indication on the inventory sheet or on the warehouse rider that the 
damage was preexisting.  Moreover, the damage involved could well have 
occurred during transit.  The shipper's repair estimate indicates that 
the damage resulted from moisture to the fiber core veneered table 
top, causing it to swell up.  The table could have been exposed to 
moisture during the delivery.    

While Andrews argues that the Army accepted Andrews's conclusion that 
it had not caused a piano in the shipment to become warped, the facts 
underlying the Army's action regarding the piano may be very different 
from those involved here.  Based on the evidence presented with regard 
to the table, Andrews has not met its burden of proving that the 
damage was preexisting.

It appears, however, that the Army did not sufficiently depreciate the 
table.  It allowed 50 percent depreciation on this 20-year-old item.  
The Army's Depreciation Guide states that ordinary wood furniture 
depreciates at 7 percent per year to a maximum of 75 percent.  Thus, 
while the Army set the depreciated value of the table at $813 (50 
percent of $1,626), it should have set the depreciated value at $406. 
50 (25 percent of $1,626).  Andrews is entitled to a refund in that 
amount.

The next item in dispute is a child's table, listed on the inventory 
sheet as item No. 174.  Andrews again argues that its inspection 
indicates that the damage is not transit-related, and it claims a 
refund of $75.

The Andrews inspection report itself confirmed that the table was 
cracked, but then states that the cracking "appears to be climatic 
damage."  At the same time, the only preexisting damage noted on the 
inventory sheet regarding this item is a scratched edge; while the 
rider describes additional damage as including gouging, chips and 
dents, it does not note any splits in the wood.  As in the case of the 
item No. 32 table, Andrews has not met its burden of proof that the 
damage was preexisting, and it remains liable for the child's table. 

Andrews also disputes $5.48 of a $77.46 setoff for the replacement 
cost of item No. 124, a cupboard set.  It contends it is not liable 
for sales taxes that are not incurred.  The Army contends that the 
replacement cost excluded tax, since a printed notice at the bottom of 
the estimate stated that the prices "do not include tax."  The DA PAM 
27-162 at paragraph 2-18d states that sales tax is compensable after 
it is incurred.  There is no evidence in the file that the tax was 
actually incurred.  Therefore, the $5.48 offset for sales tax on the 
cupboards should be refunded to the carrier.

Andrews next disputes a setoff of $54.48 for a cuckoo clock that was 
listed by the shipper as missing, but was not listed on the inventory 
sheet.  It believes that the missing clock was packed in an unnumbered 
carton which was noted as missing on its rider.  However, Andrews is 
incorrect that the clock is not listed on the inventory sheet; it is 
listed under item No. 76.  The setoff is proper.

Finally, Andrews claims $4.50 for its loss of salvage on a $20 poster.  
The Army argues that under the Joint Military Industry MOU on Salvage, 
sections c(1) and d(1), a carrier will receive no salvage credit for 
an item with a depreciated value of less than $50.  Andrews notes that 
the MOU provision states that the carrier is not entitled to exercise 
salvage rights when "the depreciated replacement value of all 
salvageable items in a shipment totals less than $100 or a single item 
of less than $50."  It argues that it is entitled to the refund 
because the shipment had salvageable items totaling well over $100.  
Since Andrews is only claiming salvage on this one item, the Army is 
correct that, in accordance with d(1), the $50 portion of the MOU 
applies.  The refund claim is denied.

Accordingly, Andrews is entitled to a refund of $411.98.  The 
remainder of its claim is denied.

/s/Lowell Dodge
for Robert P. Murphy
General Counsel

1. Carrier claim No. 93-402.

2. Army claim No. 94-061-0967.