Case No. RR272-00263
November 27, 1996
DECISION AND ORDER
OF THE DEPARTMENT OF ENERGY
Motion for Reconsideration
Name of Petitioner: Averitt Express, Inc.
Date of Filing: October 24, 1996
Case Number: RR272-263
On October 24, 1996, Wilson, Keller & Associates, a private filing service located in Memphis, Tennessee, filed a Motion for Reconsideration on behalf of Averitt Express, Inc. (Averitt) with the Office of Hearings and Appeals (OHA) of the Department of Energy (DOE). If the Motion were granted, OHA would reconsider the Application for Refund filed by Averitt in the Subpart V crude oil special refund proceeding that was dismissed on June 30, 1995, Case No. RF272-95135.
I. Background
Averitt filed two Applications for Refund in OHA's Subpart V proceeding, one on February 28, 1994 (Case No. RF272-95135), and the other on March 28, 1995 (RG272-105). When OHA contacted Averitt to obtain further information regarding the two refund applications, Averitt advised that the two refund applications were identical and requested that Case No. RF272-95135 be dismissed. See Record of Telephone Conversation between George Johnson, Chief Financial Officer, Averitt, and Rachel Thuot, OHA Staff Analyst (June 19, 1995). Accordingly, on June 30, 1995, OHA dismissed Case No. RF272-95135 and sent the dismissal letter to Averitt via certified mail, return receipt requested.. See Letter from Thomas O. Wieker, OHA Deputy Director, to George Johnson, Averitt (June 30, 1995). The return receipt returned to OHA indicates that Averitt's representative, Luke Allen, signed for the Certified Mail Letter on July 6, 1995.
II. Motion for Reconsideration
In its Motion for Reconsideration, Averitt represents that it was "never sent a copy of the dismissal notice and only learned of it recently." Request for Reconsideration at 1. In addition, Averitt states that there was a misunderstanding and it now knows that the two refund applications it submitted to OHA were not identical. Id. Specifically, Averitt states that the dismissed refund application (Case No. RF272-95135) contained Averitt's request for a refund based on gallons purchased by one of its subsidiaries, Jackson Express, Inc. (Jackson). Averitt further notes that it purchased all of Jackson's stock in 1985. Averitt distinguishes Case No. RF272-95135 from RG272-105 by advising that the
latter refund application is based on purchases Averitt itself made during the refund period, August 19, 1973 through January 27, 1981.
We have decided to grant Averitt's motion, even though we question its timeliness in view of the return receipt showing Averitt received OHA's Dismissal Letter nearly 15 months ago. When we re- examined Averitt's dismissed refund application (Case No. RF272-95135), it was clear from attachments to that application that Averitt was submitting the application based on gallonage purchased by Jackson, not Averitt. This fact, coupled with Averitt's new representation in its reconsideration request that Case No. RF272-95135 does not duplicate or subsume the gallons upon which it requests a refund in Case No. RG272-105, persuades us that Averitt would be unfairly penalized were we to deny its reconsideration request. Accordingly, we will now analyze Averitt's Application for Refund that was previously dismissed.
III. Averitt's Application for Refund
Averitt has requested a refund from crude oil monies available for disbursement by the Office of Hearings and Appeals of the Department of Energy pursuant to the Statement of Modified Restitutionary Policy In Crude Oil Cases, 51 Fed. Reg. 27899 (August 4, 1986). The company relies on the presumption of injury for end-users as the basis for its refund claim. Under this presumption, OHA will presume applicants were injured if they were end-users of petroleum products and were not covered by the DOE or its predecessors' price controls. City of Columbus, Georgia, 16 DOE ¶ 85,550 (1987).
In its refund application, Averitt explains that during the refund period, Jackson was one of Averitt's subsidiaries. According to Averitt, Averitt purchased all of Jackson's outstanding stock in 1985. Averitt has estimated Jackson's consumption of refined petroleum products during the period in question by referring to statistical data generated by the Interstate Commerce Commission (ICC) during that period. Averitt has also reduced Jackson's gallonage usage to account for miles driven by "independent owner-operators" under contract with Jackson at the time.
We find that Averitt may properly apply for a refund based on the amount of petroleum products purchased by the former subsidiary that it acquired in 1985. OHA has on numerous occasions held that the purchaser of a corporation's stock generally acquires all of the rights of the transferor, including the right to a refund absent any documentation to the contrary. See Texaco/Andy's Texaco, 22 DOE ¶ 85,001 (1992); Gulf/Flame-Rite Gas, 19 DOE ¶ 85,219 (1989); Shell/Flanders Valley, 21 DOE ¶ 85,112 (1991). In addition, we have reviewed the information submitted by Averitt and determined that Jackson was an end-user of eligible petroleum products. Moreover, we find the estimation method used by Averitt to calculate Jackson's petroleum product consumption to be acceptable.
After considering Averitt's Application carefully, we have concluded that Averitt should receive a refund in the amount of $1,927 based on Jackson's purchases of 1,204,549 gallons of petroleum products.(1) *
The final deadline for the crude oil proceeding was June 30, 1995. It is the current policy of the DOE to pay eligible crude oil refund claimants at the rate of $0.0016 per gallon. We will decide after the resolution of a few outstanding enforcement proceedings whether sufficient funds are available for additional refunds.
It Is Therefore Ordered That:
(1) The Motion for Reconsideration filed by Wilson, Keller & Associates on behalf of Averitt Express, Inc., Case No. RR272-263, for all available crude oil overcharge funds is hereby granted as set forth in Paragraph (2) below.
(2) The Director of Special Accounts and Payroll, Office of Departmental Accounting and Financial Systems Development, Office of the Controller, of the Department of Energy shall take appropriate action to disburse $1,927 from the DOE deposit fund escrow account maintained at the Department of the Treasury denominated Crude Tracking-Claimants IV, Account No. 999DOE010Z, to Averitt Express, Inc. or Wilson, Keller & Associates. The refund check should be sent to Averitt's representative at the following address:
Chris Edwards
Wilson, Keller & Associates
P.O. Box 221145
Memphis, TN. 38122
(3) To facilitate the payment of future refunds, the applicant shall notify the Office of Hearings and Appeals in the event that there is a change in its address, or if an address correction is necessary.
Such notification shall be sent to:
Director of Management Information
Office of Hearings and Appeals
Department of Energy
1000 Independence Avenue, S.W.
Washington, D.C. 20585-0107
(4)The determinations made in this Decision and Order are based upon the presumed validity of the statements and documentary material submitted by the applicant. This Decision and Order may be revoked or modified at any time upon a determination that the basis underlying the refund application is incorrect.
(5) This is a final Order of the Department of Energy.
George B. Breznay
Director
Office of Hearings and Appeals
Date: November 27, 1996
(1)Interested parties were given an opportunity to submit comments regarding the crude oil application under consideration. No such comments were filed with respect to this Application.