"(3) If on or before expiration of the two-year period of limitation in paragraph (2) a freight forwarder subject to this part begins action under paragraph (1) for recovery of charges in respect of the same service, or, without beginning action, collects charges in respect of that service, said period of limitation shall be extended to include ninety days from the time such action is begun or such charges are collected by the freight forwarder.

"(4) The cause of action in respect of a shipment of property shall, for the purposes of this section, be deemed to accrue upon delivery or tender of delivery thereof by the freight forwarder, and not after.

"(5) The term 'overcharges' as used in this section shall be deemed to mean charges for services in excess of those applicable thereto under the tariffs lawfully on file with the Commission.

"(6) The provisions of this section shall apply only to cases in which the cause of action may accrue after the date of the enactment of this section." Passed the House of Representatives January 13, 1948. Attest:

JOHN ANDREWS, Clerk.

[S. 571, 80th Cong., 1st sess.]

A BILL To amend the Interstate Commerce Act, as amended, so as to provide limitations on the time within which actions may be brought for the recovery of undercharges and overcharges by or against common carriers by motor vehicle and freight forwarders

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That part II of the Interstate Commerce Act, as amended, is amended by inserting after section 223 the following new section:

"LIMITATION ON ACTIONS

"SEC. 223a. (a) All actions at law by common carriers subject to this part for recovery of their charges, or any part thereof, shall be begun within three years from the time the cause of action accrues, and not after.

"(b) For recovery of overcharges action at law shall be begun against common carriers subject to this part within three years from the time the cause of action accrues, and not after, subject to paragraph (c) of this section, except that if claim for the overcharge has been presented in writing to the carrier within the three-year period of limitation said period shall be extended to include six months from the time notice in writing is given by the carrier to the claimant of disallowance of the claim, or any part or parts thereof, specified in the notice.

"(c) If on or before expiration of the three-year period of limitation in paragraph (b) of this section a common carrier subject to this part begins action under paragraph (a) of this section for recovery of charges in respect of the same transportation service, or without beginning action, collects charges in respect of that service, said period of limitation shall be extended to include ninety days from the time such action is begun or such charges are collected by the carrier.

"(d) The cause of action in respect of a shipment of property shall, for the purposes of this section, be deemed to accrue upon delivery or tender of delivery thereof by the carrier, and not after.

"(e) The term 'overcharges' as used in this section shall be deemed to mean charges for transportation services in excess of those applicable thereto under the tariffs lawfully on file with the Commission.

"(f) The provisions of this section shall extend to and embrace only cases in which the cause of action may accrue on and after the date of the enactment of this section."

SEC. 2. Part IV of the Interstate Commerce Act, as amended, is amended by inserting after section 414 the following new section:

"LIMITATION ON ACTIONS

"SEC. 414a. (a) All actions at law by freight forwarders for recovery of their charges, or any part thereof, shall be begun within three years from the time the cause of action accrues, and not after.

"(b) For recovery of overcharges action at law shall be begun against freight forwarders within three years from the time the cause of action accrues, and not after, subject to paragraph (c) of this section, except that if claim for the

overcharge has been presented in writing to the freight forwarder within the three-year period of limitation said period shall be extended to include six months from the time notice in writing is given by the freight forwarder to the claimant of disallowance of the claim, or any part or parts thereof, specified in the notice.

"(c) If on or before expiration of the three-year period of limitation in paragraph (b) of this section a freight forwarder begins action under paragraph (a) of this section for recovery of charges in respect of the same service, or without beginning action, collects charges in respect of that service, said period of limitation shall be extended to include ninety days from the time such action is begun or such charges are collected by the freight forwarder.

"(d) The cause of action in respect of a shipment of property shall, for the purposes of this section, be deemed to accrue upon delivery or tender of delivery thereof by the freight forwarder, and not after.

"(e) The term 'overcharges' as used in this section shall be deemed to mean charges for services in excess of those applicable thereto under the tariffs lawfully on file with the Commission.

"(f) The provisions of this section shall extend to and embrace only cases in which the cause of action may accrue on and after the date of enactment of this section."

Senator REED. We will begin with Dr. Splawn, of the Interstate Commerce Commission.

Will you proceed, please?

STATEMENT OF WALTER M. W. SPLAWN, CHAIRMAN, LEGISLATIVE COMMITTEE, INTERSTATE COMMERCE COMMISSION, WASHINGTON, D. C.

Mr. SPLAWN. My name is Walter M. W. Splawn. I am a member of the Interstate Commerce Commission and have been assigned to appear here representing the legislative committee of the Commis

sion.

We have studied these various bills to which you have referred. The bill S. 571 was introduced by Senator Cordon. We wrote a letter to your committee commenting on Senator Cordon's bill which deals with undercharges and overcharges and would amend parts II and IV by making two added sections 223 a and 414 a.

In our letter we pointed out to the committee that the Senator in his bill very helpfully, we believed, proposed uniformity so far as limitations are concerned in three parts of the act, and that was good as far as it went, but we thought it did not go far enough. We suggested that if he would change the 3 years which his bill provided, to 2 years, as is now provided in section 16, paragraph 3, it would be in line with what the Commission had been recommending as reasonable.

The bill S 935 would make the period of limitation uniform in all parts of the act.

Then came along a bill in the House, H. R. 2759. That bill finally was reported out and passed in January of this year. It parallels pretty well S. 935 so far as amending part II and part IV is concerned, except that the period of limitations is 3 years in S. 935 and 2 years in H. R. 2759. It did renumber the paragraphs, and where Senator Cordon put in 223a as the new section, the House wrote it as 204a.

The House in H. R. 2759 amended section III by lining it up so far as limitations are concerned with their amendments to 204a. They also provided a new section 406a to part IV, which carries into part IV the same provisions as to limitations on actions for overcharges

and undercharges that we now have in paragraph (3) of section 16 of part I.

S. 935 would make the period of limitations uniform in all four parts of the act, but would make it 3 years instead of the 2 years as recommended. That is correct, is it not?

Senator REED. That is correct; yes.

Mr. SPLAWN. We agree with that bill so far as uniformity is concerned, but we are in disagreement so far as the length of the period of limitations is concerned. We think that the 3 years is too long. One of the reasons for amending part II is that the limitations now are fixed by State laws; some of them run a good many years.

These claims stand out against these motor carriers for long periods. The big shippers attend to the adjustments promptly. The smaller shippers that are represented by a very useful group of people, who work up these claims and present them, should be able to get their money back within 2 years. These people are very efficient, and they can handle a claim within 2 years, we believe, as well as within 3.

Senator REED. Doctor, you know the so-called freight forwarders rather uniformly want the longer period, naturally.

Mr. SPLAWN. I know they do-and naturally-because that enables them to take more time, but that keeps these matters unsettled so long that witnesses die and evidence disappears, and it becomes more difficult to get the claims adjusted.

The House bill, H. R. 2759, does adopt the 2 years. After due consideration by the House committee and on the floor of the House, they stayed with the provision that is now in part I and made the period of limitations uniformly 2 years so far as undercharges and overcharges are concerned. They duly amend part II and part III and part IV so as to accomplish that purpose.

About a year ago, I think in May of last year, Senator Reed, you introduced S. 1194, which is a much more comprehensive bill than either of these to which I have referred.

Senator REED. In the preparation of that bill, Doctor, as you perhaps know, I had the benefit of advice and counsel from the National Industrial Traffic League.

Mr. SPLAWN. The bill gives every evidence of having been most carefully prepared and thought through.

Senator HAWKES. You are talking, Doctor, about the bill 1194?

Mr. SPLAWN. Yes, sir. That is the Senate bill. That bill covers everything that is in the House bill so far as undercharges and, overcharges are concerned. There are a few very minor editorial differences in the paragraphs that are in common. For your convenience and that of your draftsman, I have marked those on this copy of your bill.

Senator REED. Thank you very much, Doctor.

Mr. SPLAWN. Your bill, S. 1194, so far as limitations are concerned since we have been talking about limitations we will stay with that subject for the moment-is not confined merely to undercharges and overcharges. You have a paragraph 6 of your section 204a, and a corresponding paragraph 6 in your section 406a, in which you deal with actions for damages growing out of violations of the act other than merely overcharges. In that you make your amendments to parts II, III, and IV to correspond with section 16, para

graph 3, and the appropriate subparagraphs; that is, you make the act by your amendments uniform in each part so far as actions for damages are concerned.

Senator HAWKES. Mr. Chairman, I am probably very uninformed on some of this, and I just want to see. Are you going to give, Doctor, the difference between H. R. 2759 as it passed the House and S. 1194? Are you going to point out specifically the differences?

Mr. SPLAWN. Specifically the differences.

Senator HAWKES. That is fine. That is what I would like to have. Mr. SPLAWN. H. R. 2759 is substantially identical with the corresponding paragraphs in S. 1194, and to get these corresponding paragraphs, if you look for paragraph 5 of section 204a in S. 1194, you will find where the House bill H. R. 2759 begins, but the very next paragraph 6 in 1194 is omitted from the House bill, and that is a big difference, because the House bill is limited only to undercharges and overcharges.

Now that brings us to the very great difference between the two bills, because this paragraph 6 refers back to paragraph 1 of S. 1194. Paragraph 1 states the source of the cause of action. That is a rewrite of section 8 of part I. The only change there is to put in "carriers by motor vehicle" to adapt the language to part II. It is bodily lifted from section 8 of part I; and section 8, as you recall, had its origin really back in 1889, but more specifically elaborated in 1906 and amended from time to time, particularly in 1910, and the form in which it now appears in the act you read here in Senator Reed's bill as paragraph I in section 204a and section 406-a new section, amending part IV is the very same section 8 repeated and adapted part IV, freight forwarders being used instead of carriers as defined in part I.

The next change in Senator Reed's bill from the House bill is in paragraph (2) of sections 204a and 406a. Paragraph (2) is taken from section 9 of part I, and that section, as you know, provides for the election of a forum.

No; I am sorry about that. Section 9 makes liable the carrier to the claimant shipper. The claimant shipper under section 9 of part I is authorized to go into court or to the Commission for damages for the wrongs outlawed in section 8.

This paragraph (2) of Senator Reed's bill rewrites section 9 of part I and makes that section equally applicable to part II, and by appropriate amendment the same is done for part IV of the act.

Paragraph (3) of Senator Reed's bill authorizes the injured shipper to go to the Commission. Paragraph 3 of this section 204a is a rewrite of paragraph (1) of section 16, and that same rewrite is made in his amendment to part IV in his bill as paragraph 3 of section 406a. Paragraph 4 of this section 204a is a rewrite of paragraph (2), section 16, of the act, and the same is true as to paragraph (4) of section 406a of the bill.

So you see what Senator Reed has done has been to write into S. 1194 sections 8 and 9 and paragraphs (1) and (2) of section 16 of part I, and make them the first four paragraphs of his new section 204a amending part II of the act.

Senator REED. Making that applicable to motor carriers and freight forwarders.

Mr. SPLAWN. Yes. Then later down in section 3 of your bill, you amend section (f) (1) of 308, and there you delete that provision or limitation for 3 years and write in four new paragraphs, (A), (B), (C), and (D), with reference to these limitations, but in 308 the language I have referred to, section 8 and section 9, and paragraphs (1) and (2) of section 16 were written in 1940.

In the new paragraph 406a, this same thing is done in the first four paragraphs as far as freight forwarders are concerned.

Senator REED. I think that covers the distinction pretty clearly, does it not, Doctor?

Mr. SPLAWN. Yes. That makes S. 1194, you see, makes part II and IV of the act as comprehensive, so far as actions at law for damages are concerned, as part I.

Senator REED. We are following you with witnesses from the General Accounting Office, and I was wondering if you could stay and listen to a discussion of these matters by the representatives of the General Accounting Office. Does that conclude your statement, Doctor?

Mr. SPLAWN. I have one statement I would like to put in the record. I would like here to place in the record our letter on S. 1194.

Senator REED. We will be very glad to have it, Doctor.

Mr. SPLAWN. And also a supplement to that letter which I prepared yesterday with the aid of our Bureau of Law.

Following the letter and the supplement, I would like then to place in the record a summary of some of the opinions or reports of the Commission, and opinions of the court justifying what you have done in amending parts II and IV by writing in sections 8 and 9, and the first two paragraphs of section 16 into those parts.

This opinion points out, for example, that part II and part IV now are very much like the Federal Power Act in authorizing us to fix rates for the future and that so far as our awarding reparations or damages is concerned, there is no specific authorization of it in either part II or part IV.

This brief memorandum gives you the legal problems which your bill lays at rest. If agreeable, I would like to have those put in the record.

Senator REED. We would be very glad to have your letter printed and this supplementary statement, Doctor.

(The documents follow :)

Hon. WALLACE H. WHITE, Jr.,

INTERSTATE COMMERCE COMMISSION,

Washington 25, May 7, 1947.

Chairman, Committee on Interstate and Foreign Commerce,

United States Senate, Washington 25, D. C.

MY DEAR CHAIRMAN WHITE: Mr. Jarrett's letter of May 1, addressed to the Chairman of the Commission and requesting comments on S. 1194, introduced by Senator Reed, to amend the Interstate Commerce Act with respect to the liability of common carriers by motor vehicle, common carriers by water, and freight forwarders for payment of damages to persons injured by them through violations of such act, has been referred to our legislative committee. After careful consideration by that committee I am authorized to submit the following comments in its behalf:

S. 1194 would add to the Interstate Commerce Act a number of new sections which would make common carriers by motor vehicle and by water and freight forwarders liable for the payment of damages to persons injured by them through violations of the act. At present this liability exists only in respect of carriers