1. Section 321(a) of the Transportation Act of 1940 provides
that commercial rates shall be applicable to transportation of
property for the United States, excepting "military or naval
property of the United States moving for military or naval and not
for civil use."
Held: the property involved in each of the five classes
hereinafter described, which, at the time of the shipments in
1941-1943, was property of the United States, was within the
exception, and hence entitled to land-grant, rather than
commercial, rates. Pp.
330 U. S.
250-255.
(1) Copper cable consigned to a naval officer for use in the
installation of degaussing equipment (a defense against magnetic
mines) on a cargo vessel being built by a shipbuilding company
under contract with the Maritime Commission according to plans
whereby the vessel would be convertible into a military or naval
auxiliary. The degaussing specifications were prepared by the Navy,
which also furnished all material and bore the cost. The vessel was
delivered in 1941, and was operated as directed by the Maritime
Commission or the War Shipping Administration. Pp.
330 U. S. 251,
330 U. S.
255.
(2) Lumber for use in the construction of a munitions plant
which was being constructed for the Government by contractors under
Army supervision. Pp.
330 U. S. 251,
330 U. S.
255.
(3) Lumber for the construction of pontons by a contractor under
a contract with the Marine Corps. The product was either shipped
overseas in connection with military or naval operations or used in
the training of combat engineers. Pp.
330 U. S. 251,
330 U. S.
255.
(4) Bowling alley equipment destined for a naval air base under
construction on public land reserved for Navy use. The equipment
was intended to be used for recreation by the civilian construction
crew, and, upon completion of construction, by the Navy. In fact,
it was used only by servicemen. Pp.
330 U. S. 252,
330 U. S.
255.
(5) Liquid paving asphalt consigned to the Civil Aeronautics
Authority for use in constructing runways at an airport in Alaska
under a program approved by a joint cabinet board as being
Page 330 U. S. 249
necessary for the national defense. Work was commenced by a
civilian contractor, and, after the shipment had moved, was taken
over by the Army, which thereafter had full control of the field.
Pp.
330 U. S. 252,
330 U. S.
255.
2. Although the shipment of asphalt was to a civilian agency
(the Civil Aeronautics Authority), it was nevertheless "military or
naval" property within the meaning of § 321(a). Pp.
330 U. S.
252-253.
3. "Military or naval" property within the meaning of § 321(a)
is not limited to property shipped by or under control of the Army
or Navy, nor to property procured by those departments. P.
330 U. S.
253.
4. The exception prescribed by § 321(a) is not confined to
property for ultimate use directly by the armed forces. P.
330 U. S.
253.
5. Within the meaning of § 321(a), an intermediate manufacturing
phase cannot be said to have an essential "civil" aspect when the
products or articles involved are destined to serve military or
naval needs. It is the dominant purpose for which the manufacturing
or processing activity is carried on that is controlling. P.
330 U. S.
255.
6. Doubts as to the meaning of a statute which operates as a
grant of public property, or as a relinquishment of a public
interest, should be resolved in favor of the Government, and
against the private claimant. P.
330 U. S.
257.
7. Section 321(a), though enacted in the interests of the
railroads, continues land-grant rates in a narrower category, and
is to be construed in favor of the Government and against the
railroads. Pp.
330 U. S.
257-258.
156 F.2d 346, affirmed.
Petitioner brought suit against the United States under the
Tucker Act to recover the difference between commercial rates and
the land-grant rates which it received for the transportation of
government property. The District Court gave judgment for the
United States. 64 F. Supp. 1. The Circuit Court of Appeals
affirmed. 156 F.2d 346. This Court granted certiorari. 329 U.S.
701.
Affirmed, p.
330
U. S. 258.
Page 330 U. S. 250
MR. JUSTICE DOUGLAS delivered the opinion of the Court.
This is a companion case to
United States v. Powell,
and
United States v. Atlantic Coast Line R. Co., decided
this day,
ante, p.
330 U. S. 238.
This case, like those, involves the construction of the provision
of § 321(a) of the Transportation Act of 1940, which entitles
"military or naval property of the United States moving for
military or naval and not for civil use" to land-grant rates.
Petitioner was a land-grant road, 13 Stat. 365, 370, and for years
carried government property at land-grant rates. 43 Stat. 477, 486,
10 U.S.C. § 1375. It qualified to receive the higher rates
authorized by § 321(a) of the Transportation Act of 1940 by the
timely filing of the required release of land-grant claims pursuant
to § 321(b) of the Act. [
Footnote
1]
The shipments in controversy were made over petitioner's
railroad on government bills of lading in 1941, 1942, and 1943.
They were admittedly government property at the time of carriage.
Petitioner submitted its bills to the Government at the published
commercial tariff rates. The United States, claiming that, under §
321(a) of the Transportation Act, each shipment was entitled to
move at land-grant rates, deducted the difference between the
commercial rates and the land-grant rates. Petitioner thereupon
brought this suit under the Tucker Act, to recover the deducted
sums. The District Court entered judgment for the United States on
the
Page 330 U. S. 251
claims here involved. 64 F. Supp. 1. The Circuit Court of
Appeals affirmed. 156 F.2d 346. The case is here on certiorari.
The shipments involved five types of property:
Copper cable. -- Copper cable was transported to
Tacoma, Wash., for use in the installation of degaussing equipment
(a defense against magnetic mines) on a cargo vessel being so built
that it might readily be converted into a military or naval
auxiliary. The work was done by a contractor under contract with
the Maritime Commission. The degaussing specifications were
furnished by the Navy, which also furnished the equipment and bore
the cost. The vessel was delivered in 1941, and was operated as
directed by the Maritime Commission or the War Shipping
Administration. Whether it operated as a cargo vessel or as a
military or naval auxiliary does not appear.
Lumber for construction of munitions plant. -- In 1942,
the Twin Cities Ordnance Plant was being constructed in Minnesota
by contractors under the supervision of the Army. The plant was
government-owned and Army-sponsored. Army officers were procuring
agents for the lumber used in the construction. Petitioner
transported lumber for use in the construction. The plant was
completed in 1943, and manufactured ammunition for the armed
forces.
Lumber for construction of Marine Corps pontons. --
Petitioner in 1943 carried fir lumber to a plant in Minnesota to be
treated, kiln dried, milled, and manufactured by a contractor into
parts of demountable floating bridges required to move military
personnel and war vehicles across water barriers. The construction
was under a contract with the Marine Corps. The manufactured
product was either shipped overseas in connection with military or
naval operations or was used in connection with the training of
combat engineers.
Page 330 U. S. 252
Bowling alleys for Dutch Harbor. -- Petitioner moved
bowling alley equipment to Seattle, Washington, for reshipment to
the Naval Air Base, Dutch Harbor, Alaska. The Navy had entered into
a contract for the construction of an air base at Dutch Harbor on
public land reserved for Navy use. The purchase and installation of
the bowling alleys were pursuant to that contract, and were
approved by the Navy officer who had supervision and control of the
construction program. The recreational facilities, which included
the bowling alleys, were planned for initial use by the civilian
construction crew, and then, when construction work was ended, by
the Navy. But, in fact, they were used only by members of the armed
forces.
Liquid paving asphalt for Cold Bay, Alaska, airport. --
In 1942, petitioner moved liquid paving asphalt to Seattle,
Washington, for reshipment to Alaska. The asphalt was for use in
constructing runways at an airport at Cold Bay under a program of
the Civil Aeronautics Authority approved by a joint cabinet board
as being necessary for the national defense. Work was commenced by
a civilian contractor, and, after the shipment had moved, was taken
over by the Army, which thereafter had full control of the
field.
In four of the above instances, the property was consigned to an
army or navy officer; in the fifth, the shipment of liquid paving
asphalt, the Civil Aeronautics Authority was the consignee. And, as
we have said, the property in each case was, at the time of
shipment, property of the United States. The question remains
whether, within the meaning of § 321(a), it was "military or naval"
property, and, if so, whether it was "moving for military or naval"
use.
There is a suggestion that, since the shipment of asphalt was to
a civilian agency, the Civil Aeronautics Authority, it was not
"military or naval" property. The theory is
Page 330 U. S. 253
that "military or naval" property means only property shipped by
or under control of the army or navy.
We see no merit in that suggestion. Section 321(a) makes no
reference to specific agencies or departments of government. The
fact that the War or Navy Department does the procurement might, of
course, carry special weight, or be decisive in close cases. But it
is well known that procurement of military supplies or war material
is often handled by agencies other than the War and Navy
Departments. Procurement of cargo and transport vessels by the
Maritime Commission is an outstanding example.
See
Merchant Marine Act of 1936, § 902, 49 Stat. 2015, 2016, as
amended, 46 U.S.C. § 1242. And, shortly before the Transportation
Act of 1940 was enacted, Congress, by the Act of June 25, 1940, 54
Stat. 572, 573, 574, authorized the Reconstruction Finance
Corporation to create subsidiary corporations to purchase and
produce equipment, supplies, and machinery for the manufacture of
arms, ammunition, and implements of war. And later, that Act was
amended to enable those corporations to purchase or produce any
supply or article necessary for the national defense or war effort.
Act of June 10, 1941, 55 Stat. 248, 249. As we have held in
United States v. Powell, supra, not every purchase which
furthers the national defense is for "military or naval" use within
the meaning of § 321(a). But property may fall within that category
though it is procured by departments other than War or Navy.
It is also suggested that the property covered by the exception
in § 321(a) is confined to property for ultimate use directly by
the armed forces. Under that view, materials shipped for the
construction of vessels for the Maritime Commission and used to
service troops at home or abroad would not be "military or naval"
property. We likewise reject that argument. Civilian agencies may
service the armed forces or act as adjuncts to them. The
Maritime
Page 330 U. S. 254
Commission is a good example. An army and navy on foreign shores
or in foreign waters cannot live and fight without a supply fleet
in their support. The agency, whether civil or military, which
performs that function is serving the armed forces. The property
which it employs in that service is military or naval property,
serving a military or naval function.
But petitioner contends that, even if that is true, the
construction of vessels or other military equipment or supplies is
in a different category. It argues that none of the articles
shipped in the present case was military or naval, since they were
not furnished to the armed forces for their use. They were
supplied, so the argument runs, for manufacture and construction,
which are civilian pursuits, and which were here, in fact,
performed by civilian contractors. Only the completed product, not
the component elements, was, in that view, for military or naval
use.
Military or naval property may move for civil use, as where army
or navy surplus supplies are shipped for sale to the public. But,
in general, the use to which the property is to be put is the
controlling test of its military or naval character. Pencils, as
well as rifles, may be military property. Indeed, the nature of
modern war, its multifarious aspects, the requirements of the men
and women who constitute the armed forces and their adjuncts, give
military or naval property such a broad sweep as to include almost
any type of property. More than articles actually used by military
or naval personnel in combat are included. Military or naval use
includes all property consumed by the armed forces or by their
adjuncts, all property which they use to further their projects,
all property which serves their many needs or wants in training or
preparation for war, in combat, in maintaining them at home or
abroad, in their occupation after victory is won. It is the
relation of the shipment to the military or naval effort that is
controlling
Page 330 U. S. 255
under § 321(a). The property in question may have to be
reconditioned, repaired, processed, or treated in some other way
before it serves their needs. But that does not detract from its
status as military or naval property.
Southern Pacific Co. v.
Defense Supplies Corp., 64 F. Supp.
605. Within the meaning of § 321(a), an intermediate
manufacturing phase cannot be said to have an essential "civil"
aspect when the products or articles involved are destined to serve
military or naval needs. It is the dominant purpose for which the
manufacturing or processing activity is carried on that is
controlling.
Measured by that test, there can be no doubt that the five types
of property involved in the present litigation were "military or
naval" property of the United States "moving for military or naval,
and not for civil, use" within the meaning of § 321(a). The lumber
for the pontons, the asphalt for the airfield, the lumber for the
ammunition plant were used in Army or Navy projects directly
related to combat preparation or to actual combat. Copper cable for
the cargo vessel, though farther removed from that category, was
well within the definition of "military or naval" property. It,
too, was a defensive weapon. Beyond that, it was purchased by the
Navy Department and consigned to one of its officers. It was
supplied pursuant to Navy specifications, and the ship on which it
was installed was being prepared for possible ultimate use by the
Navy. The bowling alleys were also well within the statutory
classification. The needs of the armed forces plainly include
recreational facilities. The morale and physical condition of
combat forces are as important to the successful prosecution of a
war as their equipment. The fact that the bowling alleys were
planned for initial use of civilian workers makes no difference. It
is the nature of the work being done, not the status of the person
handling the materials, that is decisive. Supplies to maintain
civilians repairing army or navy planes is a case in point.
Page 330 U. S. 256
The dominant purpose of the project in this case was the same
whether civilians or military or navy personnel did the actual
work.
Petitioner contends that, if Congress intended to include in
"military or naval property" articles for use in the manufacture of
implements of war, it would have said so. It seeks support for that
position from other Congressional enactments under which such
materials were excluded because not mentioned, [
Footnote 2] or were included by specific
reference. [
Footnote 3] We can
find, however, little support for petitioner's contention in that
argument. Apart from the different wording of those acts and the
different ends they served, there is one decisive and controlling
circumstance. We have more in § 321(a) than a declaration that
"military or naval" property is entitled to land-grant rates.
Congress went further, and drew the line between property moving
for "military or naval" use and property moving
Page 330 U. S. 257
for "civil" use. As we have said, the controlling test is the
use to which the property is dedicated or devoted. The fact that
Congress did not define what was a "military or naval" use, as
distinguished from a "civil" use, is unimportant. The
classification made by Congress under this Act, unlike that made
under the acts on which petitioner relies, was all-inclusive, not
partial. What is military or naval is contrasted to what is civil.
The normal connotation of one serves to delimit or expand the
other. It is in that context that "military or naval" must be
construed.
Petitioner also contends that § 321(a) is a remedial enactment
which should be liberally construed so as to permit no exception
which is not required.
Cf. Piedmont & N. Ry. Co. v.
Interstate Commerce Commission, 286 U.
S. 299,
286 U. S.
311-312. But it is a familiar rule that, where there is
any doubt as to the meaning of a statute which "operates as a grant
of public property to an individual or the relinquishment of a
public interest," the doubt should be resolved in favor of the
Government, and against the private claimant.
Slidell v.
Grandjean, 111 U. S. 412,
111 U. S. 437.
See Southern Ry. Co. v. United States, 322 U. S.
72,
322 U. S. 76.
That rule has been applied in construing the reduced rate
conditions of the land-grant legislation.
Southern Pacific Co.
v. United States, 307 U. S. 393,
307 U. S. 401;
Southern Ry. Co. v. United States, supra. That principle
is applicable here, where the Congress, by writing into § 321(a) an
exception, retained for the United States an economic privilege of
great value. The fact that the railroads, including petitioner,
filed releases of their land-grant claims in order to obtain the
benefits of § 321(a) is now relied upon as constituting full
consideration for the rate concession. It is accordingly argued
that the railroads made a contract with the United States which
should be generously construed.
Cf. Russell v. Sebastian,
233 U. S. 195,
233 U. S. 205.
The original land-grants resulted in a contract.
Burke
Page 330 U. S. 258
v. Southern Pacific R. Co., 234 U.
S. 669,
234 U. S. 680.
Yet, as we have seen, they were nonetheless public grants strictly
construed against the grantee. The present Act, though passed in
the interests of the railroads, was, in essence, merely a
continuation of land-grant rates in a narrower category. Therefore,
it, too, must be construed like any other public grant.
Affirmed.
[
Footnote 1]
This release was followed by a settlement of the litigation
before this Court in
United States v. Northern Pacific R.
Co., 311 U. S. 317.
See United States v. Northern Pacific R. Co., 41 F. Supp.
273; S.Doc. No. 48, 77th Cong., 1st Sess.
[
Footnote 2]
The embargo against "arms or munitions of war" authorized by the
Joint Resolution of March 14, 1912 (
see 37 Stat. 1733),
was held not to include machinery for the construction of a
munitions plant. 32 Op.Atty.Gen. 132.
[
Footnote 3]
Thus, the Act of July 2, 1940, 54 Stat. 712, 714, 50
U.S.C.Appendix, § 701, authorized the President to prohibit or
curtail
"the exportation of any military equipment or munitions, or
component parts thereof, or machinery, tools, or material, or
supplies necessary for the manufacture, servicing, or operation
thereof. . . ."
The Act of November 30, 1940, 54 Stat. 1220, amending the
Anti-Sabotage Act, defined "national defense material" as
including
"arms, armament, ammunition, livestock, stores of clothing,
food, foodstuffs, fuel, supplies, munitions, and all other articles
of whatever description and any part or ingredient thereof"
which the United States intended to use in the national
defense.
The Act of October 16, 1941, 55 Stat. 742, authorized the
President to requisition the following types of property for the
defense of the United States:
"military or naval equipment, supplies, or munitions, or
component parts thereof, or machinery, tools, or materials
necessary for the manufacture, servicing, or operation of such
equipment, supplies, or munitions. . . ."