______________________________ November 25, 1997 ______________________________ GSBCA 13810-RATE In the Matter of C. I. WHITTEN TRANSFER CO. Robert D. Norcom, Auditor, C. I. Whitten Transfer Co., Joplin, MO, appearing for Claimant. Jeffrey J. Thurston, Director, Office of Transportation Audits, General Services Administration, Washington, DC, appearing for General Services Administration. Col. James F. Quinn, Staff Judge Advocate, Headquarters, Military Traffic Management Command, Department of the Army, Falls Church, VA, appearing for Department of Defense. WILLIAMS, Board Judge. Claimant C. I. Whitten Transfer Co. (WITT) seeks review of the Defense Finance and Accounting Service's (DFAS') denial of its $85 claim for one additional day of detention charges relating to government bill of lading (GBL) C-7,968,730. WITT claims that it erroneously billed DFAS for only one day of detention instead of two, and DFAS, therefore, underpaid in the amount of $85 for this service. Because neither WITT nor DFAS presented this claim to the General Services Administration s (GSA s) Office of Transportation Audits (OTA) for a prepayment audit, we deem the claim premature and, therefore, dismiss it without prejudice. Background Government bill of lading C-7,968,730 was issued on February 2, 1993, authorizing a shipment of goods from the Letterkenny Army Depot in Chambersburg, Pennsylvania, to the Naval Weapons Station in Concord, California. In a letter dated March 25, 1993, WITT advised DFAS that the shipment had accrued detention charges because the receiving ship had been delayed. The shipment arrived in California on February 8, 1993, at 8:00 a.m., but the trailer was not unloaded until February 11, 1993, at 10:20 a.m. February 8, 1993, was a Monday. The detention certificate stated: Total Number of Days Trailer Spotted 3, Chargeable Days 1, total Charge $85. . . . 24 hours free time allowed plus the first weekend if any part of the 24 hours runs into the weekend. The charge for the first two days $85 each, next two days $90 each, fifth day and beyond $95. According to voucher number 625322, the $85 for this detention charge was paid to WITT on April 22, 1993. On January 31, 1996, WITT submitted a supplemental claim under GBL C-7,968,730 seeking an additional $85 for the extra day of detention. In its supplemental bill, WITT stated: "Free time ends 2-9-93 8:00; chargeable days 2-10-93 and 2-11-93, two days $85/day." Under basis for claim, WITT stated: "To correct chargeable days." On May 2, 1996, DFAS returned WITT's supplemental bill to WITT declining payment because the charges on Bill of Lading number C-7,968,730 had been paid on April 22, 1993, to C. I. Whitten Transfer Co. On July 11, 1996, WITT requested review by the Comptroller General (GAO) of the denial of its supplemental carrier bill. WITT informed GAO that the original detention charges in the amount of $85 were paid but that these charges should have been for two days at $85 instead of one day as originally billed. On August 15, 1996, this claim was transferred to this Board. Discussion As a threshold matter, GSA's OTA states that WITT has not filed a claim with OTA and, therefore, has not exhausted its administrative remedies, citing 41 CFR 101-41.600. We agree that because this claim was not reviewed by OTA, the claim is not ripe for review by this Board. In Section 322 of the Transportation Act of 1940, as amended (now codified at 31 U.S.C. 3726), Congress set up a system for paying carriers for providing transportation services to agencies of the Federal Government. The statute also set forth a mechanism for resolving disputes arising from those transactions. See Dalton v. Sherwood Van Lines, Inc., 50 F.3d 1014, 1016 (Fed. Cir. 1995). As our appellate authority has recognized, under this statutory scheme, "[a] carrier must present a claim for payment to the General Services Administration (GSA) or other designated agency within three years of accrual. 3726(a)." Id. Effective in 1996, if dissatisfied with the agency's action on the claim, the carrier may request review by this Board. 31 U.S.C. 3726(g)(1).[foot #] 1 In the instant case, WITT contends that it was not required to present its claim to GSA but properly submitted its claim to the designated agency under the regulations, i.e., the agency out of whose activities the claim arose. WITT cites 41 CFR 101-41.604-1, which provides: Unless GSA's Office of Transportation Audits determines that a prepayment audit is necessary under 41 CFR 101-41.103(i), each agency or department shall pay any properly documented bill (claim) for freight or passenger transportation charges that is not excepted by the provisions of 101-41.604-2. WITT further contends that its invoice was not "excepted" under the provisions of Section 604-2. In this regard, WITT is incorrect. 41 CFR 101-41.604-2(b), "Transportation Claims not Payable by Agencies," delineates the types of claims which agencies shall not pay. Included in that litany is: (4), any pricing adjustment claims for services previously billed and paid . . . . WITT's supplemental $85 claim for the extra day of detention falls squarely within this paragraph since WITT seeks an upward adjustment on its invoice for services previously billed and paid. As such, the regulation prohibits DFAS from paying the claim and requires instead that the claim undergo a prepayment audit by GSA. Subparagraph 5 of Section 2(b) of this regulation specifies: "Claims described in paragraph (b) of this section are subject to GSA prepayment audit. Subparagraph (c) of 41 CFR 101-41.604-2 clarifies the requirement that the claims enumerated in subparagraph (b) be presented to GSA: "Claims described in paragraph (b) of this section will be handled by GSA under the provisions of Section 101-41.605 of this subpart and shall be forwarded separately from other types of transportation documents to the General Services Administration (BWCA), Washington, D.C. 20405." As this Board recently recognized in Tri-State Motor Transit Co., GSBCA 13896-RATE, 97-1 BCA 28,873: The various provisions found in 41 CFR 101-41.6 describe a regulatory scheme for the presentation, ----------- FOOTNOTE BEGINS --------- [foot #] 1 Previously, carriers sought review of such agency decisions from the Comptroller General. See generally, C. I. Whitten Transfer Co., GSBCA 13911-RATE, 97-1 BCA 28,860. ----------- FOOTNOTE ENDS ----------- settlement, reconsideration, and review of transportation claims against the United States. Claims are normally to be submitted to GSA's "designee" which, in this case is defined as: "the agency out of whose activities the claim arose." The regulation authorizes the designee agencies to pay properly documented claims without any prepayment audit. Certain claims, however, are singled out under the regulations as "not payable" by the agencies. Id. at 144,008. In Tri-State, the claim found to be not payable by the agency and subject to a GSA prepayment audit was addressed in subparagraph (3) of paragraph 604-2(b) dealing with "doubtful claims." The Board s rationale in Tri-State is equally applicable to the pricing adjustment claims described in subparagraph (b)(4). The Board in Tri-State explained its rationale for requiring submission of such a claim to OTA before considering it in this forum: Under . . . 41 CFR 101-41.6, a claim, once designated as "doubtful," must be referred to GSA for audit and final administrative action. Only then, after GSA has audited the claim and made its final determination, are we in a position to review that audit determination on behalf of the Administrator. Accordingly, we conclude that any right of a carrier to reconsideration or review of a payment office's action must be exercised in the context of GSA's audit and settlement of the claim in question. In the absence of this determination, the action of the agency paying office is not yet ripe for review by this Board. Id. at 144,008. Applying this rationale, we conclude that under Section 101-41.604-2(b)(4) a pricing adjustment claim for services previously billed and paid, such as that at issue here, may not be considered by this Board until OTA has reviewed it. This conclusion does not, however, end the matter. The Military Traffic Management Command (MTMC) also argued that WITT's claim was barred under the doctrine of laches. Specifically, MTMC argues that WITT submitted its original claim on March 25, 1993, but that not until almost three years later, on January 31, 1996, did WITT submit a supplemental voucher for transportation charges to DFAS claiming the additional $85. MTMC has not met its burden of proving that laches should be applied here. As the proponent of this defense, MTMC has the burden of proving both (a) unreasonable and unexcused delay by the claimant in bringing the claim and (b) prejudice to the respondent because of that delay. Whitten, 97-1 BCA 28,860, (citing Costello v. United States, 365 U.S. 265, 282 (1961); Cornetta v. United States, 851 F.2d 1372, 1377-78 (Fed. Cir. 1988) (en banc); P.A.L. Systems Co., GSBCA 10858, 91-3 BCA 24,259, at 121,287). In considering whether claimant's delay was unreasonable and unexcused, we note that claimant did file its claim within the statute of limitations. The applicable statute, 31 U.S.C. 3726, imposes a three-year limitation on the filing of claims with GSA or its designee (the agency out of whose activities the claim arose). The three years begins to run from the latest of the following dates: (1) accrual of the cause of action; (2) payment of charges for the transportation involved; (3) refund for overpayment of such charges; or (4) deduction made under 31 U.S.C. 3726, whichever is earliest. WITT's claim with DFAS was filed on January 31, 1996, within three years of the date of DFAS' original payment, April 22, 1993. As such, its claim is not barred by the statute of limitations. Nonetheless, our appellate authority has ruled that laches can apply within the statutory limitation period. A. C. Aukerman v. R. L. Chaides Construction Co., 960 F.2d 1020, 1030 (Fed. Cir. 1992) (en banc). However, as we recognized in Whitten, because the Congress has established a three-year statutory limitation: we will exercise caution in intruding on this legislative judgment as to when a claim is too stale to pursue against the Government. Cornetta, 851 F.2d at 1380 n.2, 1381; see also id. at 1384 (Michel, J., concurring: "Generally an action brought within the time period for the applicable statute of limitations . . . will not be considered unreasonably delayed, except upon a showing of special facts making the delay culpable."); Advanced Cardiovascular Systems, Inc. v. Scimed Life Systems, Inc., 988 F.2d 1157, 1161 (Fed. Cir. 1993). 97-1 BCA at 143,988. MTMC has not articulated any facts establishing that WITT's delay in submitting its supplemental voucher was culpable. Nor has MTMC established prejudice. Prejudice encompasses both the inability to mount a defense (which may be caused by loss of records, destruction of evidence, fading memories, or unavailability of witnesses) and economic prejudice. Whitten, 97-1 BCA at 143,988, (citing Cornetta, 851 F.2d at 1378). While MTMC has generally stated that "the Government's ability to recreate the events surrounding the shipment is significantly impaired by the passage of time," the agency has offered no specific impediment to defending this claim. We do not accept MTMC's assertion that the $85 claim should be regarded as de minimis given the lack of timeliness, since MTMC has proffered no specific evidence of increased costs in defending this claim due to the passage of time. Decision This case is dismissed without prejudice. __________________________ MARY ELLEN COSTER WILLIAMS Board Judge