B-189768, JUN 15, 1978

B-189768, JUN 15, 1978

DIGEST: TRANSFERRED EMPLOYEE WAS PURCHASING RESIDENCE AT OLD STATION UNDER LAND CONTRACT AT TIME OF TRANSFER. EMPLOYEE QUIT CLAIMED HIS INTEREST UNDER THE CONTRACT TO HIS SELLER (MOTHER), WHO ENTERED INTO A SUBSEQUENT LAND CONTRACT FOR SALE OF PROPERTY WITH A THIRD PARTY. ALTHOUGH EMPLOYEE MAY BE REIMBURSED EXPENSES INCURRED INCIDENT TO RECONVEYANCE OF INTEREST TO SELLER, EXPENSES OF SELLER'S SUBSEQUENT SALE TO THIRD PARTY MAY NOT BE PAID SINCE TITLE REQUIREMENTS OF FTR PARA. 2-6.1C ARE NOT MET.

DAVID R. TAYLOR - RESIDENCE TRANSACTION EXPENSES:

THIS ACTION IS IN RESPONSE TO A REQUEST BY MR. C.J. TERRY, A CERTIFYING OFFICER OF THE DEPARTMENT OF COMMERCE, NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION, FOR A DECISION CONCERNING THE LEGALITY OF A CLAIM BY MR. DAVID R. TAYLOR FOR REIMBURSEMENT OF RESIDENCE TRANSACTION EXPENSES.

THE RECORD INDICATES THAT ON NOVEMBER 11, 1976, MR. TAYLOR WAS TRANSFERRED FROM NUNICA, MICHIGAN, TO COLD BAY, ALASKA. THE VOUCHER COVERS A CLAIM FOR EXPENSES INCIDENT TO THE SALE OF A RESIDENCE AT THE OLD STATION IN NUNICA. MR. TAYLOR HAD PREVIOUSLY ACQUIRED AN INTEREST IN HIS NUNICA RESIDENCE BY MEANS OF A LAND CONTRACT EXECUTED ON DECEMBER 12, 1975, BETWEEN HIMSELF AND HIS WIFE AS PURCHASER, AND MS. LAURA B. OTT, THE MOTHER OF THE EMPLOYEE, AS SELLER. WHEN MR. TAYLOR WAS TRANSFERRED, MS. LAURA B. OTT ACTED AS AGENT TO ARRANGE FOR THE SALE OF THE PROPERTY TO A THIRD PARTY. ON FEBRUARY 17, 1977, MR. TAYLOR AND HIS WIFE QUIT CLAIMED THE PROPERTY TO MS. LAURA B. OTT. THE QUIT CLAIM DEED CONTAINS NO RECITAL OF CONSIDERATION, BUT PROVIDES:

"THIS DEED IS GIVEN TO CONVEY PURCHASERS INTEREST IN A CERTAIN LAND CONTRACT DATED DECEMBER 12, 1975, WHICH WAS EXECUTED BETWEEN THE ABOVE NAMED PARTIES." SUBSEQUENTLY, ON FEBRUARY 28, 1977, MS. LAURA B. OTT EXECUTED A LAND CONTRACT BETWEEN HERSELF AND MR. AND MRS. CARL W. SMITH, JR., WHO ARE NOT PARTIES TO THIS ACTION. THE RECORD CONTAINS A SELLER'S CLOSING STATEMENT DATED FEBRUARY 28, 1977, LISTING MS. LAURA B. OTT AS THE SELLER AND THE SMITHS AS PURCHASERS OF THE PROPERTY IN QUESTION. AMONG THE CHARGES LISTED ARE:

TITLE INSURANCE $ 81.00

RECORD QUIT-CLAIM DEED FROM TAYLOR 3.00

7% BROKER'S COMMISSION 2,240.00 MR. TAYLOR IS CLAIMING REIMBURSEMENT OF THESE CHARGES, TOTALING $2,324, WHICH ARE IN FACT COSTS ASSESSED AGAINST THE SELLER OR OWNER OF THE PROPERTY, MS. LAURA B. OTT.

THE CERTIFYING OFFICER QUESTIONS WHETHER THE VOUCHER MAY BE CERTIFIED FOR PAYMENT ON THE BASIS THAT SINCE TITLE TO THE PROPERTY WAS NOT IN MR. TAYLOR'S NAME AT THE TIME THE PROPERTY WAS SOLD TO THE SMITHS, MR. TAYLOR HAS NOT SATISFIED THE TITLE REQUIREMENTS SET FORTH IN PARAGRAPH 2-6.1C OF THE FEDERAL TRAVEL REGULATIONS (FTR) (FPMR 101 7, MAY 1973). IN RESPONSE, MR. TAYLOR EXPLAINS THAT AFTER HIS TRANSFER TO ALASKA, HE FELT THAT THE "EASIEST WAY TO SELL THE HOUSE, WITHOUT SENDING LEGAL PAPERS BACK AND FORTH THROUGH THE MAIL, WAS TO SIGN A QUIT CLAIM" ALLOWING HIS MOTHER TO SELL THE PROPERTY. HE STATES THAT HE SIGNED THE QUIT CLAIM DEED ONLY AFTER THE SMITHS HAD AGREED TO BUY THE PROPERTY.

IN B-174644, APRIL 20, 1972, WE HELD THAT THE SALE OF A RESIDENCE UNDER A LAND CONTRACT EFFECTED A SALE WHICH PERMITS REIMBURSEMENT OF REAL ESTATE EXPENSES UNDER THE PROVISIONS OF 5 U.S.C. 5724AA)(4) AND THE IMPLEMENTING REGULATIONS, NOW CONTAINED IN FTR PARA. 2-6.1 ET SEQ., (MAY 1973). SPECIFICALLY, PARAGRAPH 2-6.3A PROVIDES, IN PART:

"*** AMOUNTS CLAIMED MUST BE SUPPORTED BY DOCUMENTATION SHOWING THAT THE EXPENSE WAS IN FACT INCURRED AND PAID BY THE EMPLOYEE. ***" IN ADDITION, FTR PARAGRAPH 2-6.1C PROVIDES FOR TITLE REQUIREMENTS AS FOLLOWS:

"TITLE REQUIREMENTS. THE TITLE TO THE RESIDENCE OR DWELLING AT THE OLD OR NEW OFFICIAL STATION, OR THE INTEREST IN A COOPERATIVELY OWNED DWELLING OR IN AN UNEXPIRED LEASE, IS IN THE NAME OF THE EMPLOYEE ALONE, OR IN THE JOINT NAMES OF THE EMPLOYEE AND ONE OR MORE MEMBERS OF HIS IMMEDIATE FAMILY, OR SOLELY IN THE NAME OF ONE OR MORE MEMBERS OF HIS IMMEDIATE FAMILY. ***"

IN THE PRESENT CASE, MR. TAYLOR HAD AN EQUITABLE INTEREST IN THE PROPERTY BY VIRTUE OF HIS ORIGINAL LAND CONTRACT WITH MS. LAURA B. OTT. SEE 51 MICHIGAN LAW REVIEW, 509, 547 (1953). WHEN MR. TAYLOR QUIT CLAIMED THE PROPERTY TO MS. LAURA B. OTT, HE DIVESTED HIMSELF OF ANY INTEREST IN THE PROPERTY. SINCE THE QUIT CLAIM DEED CONVEYED TO MS. LAURA B. OTT HIS FULL INTEREST IN THE RESIDENCE, THE EXPENSES OF THAT TRANSACTION MAY BE REIMBURSED. THE RECORD SHOWS THE ONLY EXPENSE INCURRED WAS A FEE OF $3 FOR RECORDING THE QUIT CLAIM DEED.

MR. TAYLOR, HOWEVER, HAS REQUESTED PAYMENT OF EXPENSES INCURRED BY MS. LAURA B. OTT IN THE SUBSEQUENT SALE TO THE SMITHS. IN SO DOING, HE HAD ARGUED THAT HE QUIT CLAIMED HIS INTEREST TO MS. LAURA B. OTT IN ORDER TO PERMIT HER TO SELL IT FOR HIM WITHOUT HAVING DOCUMENTS TRAVEL IN THE MAIL. HOWEVER, SINCE THE TITLE REQUIREMENT OF FTR PARA. 2-6.1C ARE NOT MET, THE CLAIMED EXPENSES RESULTING FROM THE TRANSACTION BETWEEN MS. LAURA B. OTT AND THE SMITHS MAY NOT BE PAID.