B-177096, DEC 22, 1972

B-177096, DEC 22, 1972

CIVILIAN EMPLOYEE - SALE OF RESIDENCE - EXTENSION OF TIME - ACT OF GOD - "MERITORIOUS CLAIM" DECISION REGARDING THE QUESTION AS TO WHETHER JOHN H. HART MAY, FOR PURPOSES OF REIMBURSEMENT UNDER PROVISIONS OF SUBSECTION 5724AA)(4) OF 5 U.S.C., BE GRANTED AN ADDITIONAL EXTENSION OF TIME WITHIN WHICH TO CONSUMATE THE SALE OF HIS FORMER RESIDENCE AT HARRISBURG, PA., HIS PREVIOUS DUTY STATION. OMB CIRCULAR NO. A-56, SUBSECTION 4.1E, PROVIDES THAT A MAXIMUM TIME EXTENSION OF ONE YEAR MAY BE GRANTED IN CONNECTION WITH THE SALE OF A RESIDENCE. SINCE THIS REGULATION IS STATUTORY IN NATURE, HAVING THE FORCE AND EFFECT OF LAW, NO FURTHER EXTENSION MAY LEGALLY BE GRANTED CLAIMANT. HOWEVER, SINCE THE CAUSE FOR THE DELAY IN CONSUMATING THE SALE WAS AN ACT OF GOD (HURRICAN AGNES), THE COMP. GEN. FEELS THAT THERE ARE SUFFICIENT EQUITABLE INTERESTS HERE TO WARRANT REFERRAL OF THE CLAIM TO CONGRESS FOR CONSIDERATION UNDER THE MERITORIOUS CLAIMS ACT, 31 U.S.C. 236, WITH A RECOMMENDATION FOR ENACTMENT OF RELIEF LEGISLATION.

TO MR. SECRETARY:

THIS REFERS TO THE LETTER RECEIVED IN THIS OFFICE SEPTEMBER 25, 1972, FROM THE ASSOCIATE ASSISTANT SECRETARY FOR FINANCIAL MANAGEMENT REQUESTING OUR DECISION AS TO WHETHER MR. JOHN H. HART MAY, FOR PURPOSES OF REIMBURSEMENT UNDER PROVISIONS OF SUBSECTION 5724AA)(4) OF TITLE 5, U.S.C. BE GRANTED AN ADDITIONAL EXTENSION OF TIME WITHIN WHICH TO CONSUMMATE THE SALE OF HIS FORMER RESIDENCE AT HIS PREVIOUS OFFICIAL DUTY STATION.

THE RECORD SHOWS THAT MR. HART TRANSFERRED FROM HARRISBURG, PENNSYLVANIA, TO PHILADELPHIA, PENNSYLVANIA, EFFECTIVE AUGUST 9, 1970. ON AUGUST 6, 1971, MR. HART'S AGENT EXECUTED ON HIS BEHALF A CONTRACT FOR THE SALE OF HIS FORMER RESIDENCE AT HARRISBURG. IN ACCORDANCE WITH PROVISIONS OF SUBSECTION 4.1E, OF OFFICE OF MANAGEMENT AND BUDGET CIRCULAR NO. A-56, MR. HART WAS GRANTED, ON AUGUST 11, 1971, AN EXTENSION OF 6 MONTHS FROM THE ANNIVERSARY DATE OF HIS TRANSFER IN WHICH TO COMPLETE THE SALE OF HIS PROPERTY. THE CIRCUMSTANCES JUSTIFYING THE EXTENSION (DIFFICULTIES ENCOUNTERED BY THE EMPLOYEE IN NEGOTIATING THE SALES CONTRACT) WERE DULY SET FORTH IN A LETTER FROM THE REGIONAL MANPOWER ADMINISTRATOR. SUBSEQUENT LETTERS FROM THE REGIONAL MANPOWER ADMINISTRATOR DATED FEBRUARY 9, 1972, AND MARCH 21, 1972, WERE SUPPLIED TO JUSTIFY AN ADDITIONAL EXTENSION OF TIME THROUGH AUGUST 7, 1972. THE FURTHER EXTENSION WAS REQUIRED, AS EXPLAINED BY THE REGIONAL ADMINISTRATOR, DUE TO THE DELAY OF THE FEDERAL HOUSING ADMINISTRATION IN APPROVING A LOAN TO THE BUYER AND DIFFICULTIES ENCOUNTERED IN OBTAINING A MORTGAGE.

IN A LETTER DATED JULY 28, 1972, THE REGIONAL ADMINISTRATOR REQUESTED AUTHORITY TO GRANT MR. HART AN ADDITIONAL 1-YEAR EXTENSION OF TIME, JUSTIFYING THE REQUEST AS FOLLOWS:

"FEDERAL HOUSING ADMINISTRATION'S DELAY IN APPROVING THE LOAN, AND DIFFICULTIES IN OBTAINING A MORTGAGE FOR THE SALE, PRECLUDED THE SCHEDULING OF A SETTLEMENT DATE ON THE CONTRACT BEFORE JUNE 27, 1972. ALL MATTERS IN ORDER, THIS DATE WAS FINALLY CONFIRMED BY ALL NEGOTIATING PARTIES.

"ON FRIDAY, JUNE 22 THROUGH SUNDAY, JUNE 24, 1972, THE CITY OF HARRISBURG SUFFERED EXTENSIVE FLOOD DAMAGES CAUSED BY TROPICAL STORM AGNES. AS A RESULT, MR. HART'S PROPERTY WAS SEVERELY DAMAGED, ESTIMATED IN THE AMOUNT OF $5,000. CONSEQUENTLY, THE PROPERTY MUST NOW BE REBUILT AND REFURNISHED TO A (SALEABLE) CONDITION ACCEPTABLE TO ALL PARTIES BEFORE SETTLEMENT CAN BE COMPLETED.

"UNDER THE PRESENT CIRCUMSTANCES - THE TIME REQUIRED FOR PROPERTY TO DRY OUT (FLOOD WATERS WERE 4-1/2 FEET ABOVE THE FIRST FLOOR), AVAILABILITY OF CONTRACTORS TO SCHEDULE AND PERFORM WORK (MASSIVE WAITING LISTS DUE TO OTHERS SUFFERING SIMILAR MISHAPS) - MR. HART IS UNABLE TO DETERMINE THE LENGTH OF TIME INVOLVED IN COMPLETING THE REPAIRS TO THE PROPERTY AND CONSUMMATING THE SALE. HOWEVER, HE BELIEVES THAT AN ADDITIONAL ONE-YEAR EXTENSION WOULD BE SUFFICIENT."

SUBSECTION 4.1E, OF CIRCULAR NO. A-56, SUPRA, PROVIDES AS FOLLOWS:

"4.1 CONDITIONS AND REQUIREMENTS UNDER WHICH ALLOWANCES ARE PAYABLE. THE EXTENT ALLOWABLE UNDER THIS PROVISION, THE GOVERNMENT WILL REIMBURSE AN EMPLOYEE FOR EXPENSES REQUIRED TO BE PAID BY HIM IN CONNECTION WITH THE SALE OF ONE RESIDENCE AT HIS OLD OFFICIAL STATION; PURCHASE (INCLUDING CONSTRUCTION) OF ONE DWELLING AT HIS NEW OFFICIAL STATION; OR THE SETTLEMENT OF AN UNEXPIRED LEASE INVOLVING HIS RESIDENCE OR A LOT ON WHICH A HOUSE TRAILER USED AS HIS RESIDENCE WAS LOCATED AT THE OLD OFFICIAL STATION; PROVIDED THAT:

"E. TIME LIMITATION. THE SETTLEMENT DATES FOR THE SALE AND PURCHASE OR LEASE TERMINATION TRANSACTIONS FOR WHICH REIMBURSEMENT IS REQUESTED ARE NOT LATER THAN ONE (INITIAL) YEAR AFTER THE DATE ON WHICH THE EMPLOYEE REPORTED FOR DUTY AT THE NEW OFFICIAL STATION, EXCEPT THAT (1) AN APPROPRIATE EXTENSION OF TIME MAY BE AUTHORIZED OR APPROVED BY THE HEAD OF THE AGENCY OR HIS DESIGNEE WHEN SETTLEMENT IS NECESSARILY DELAYED BECAUSE OF LITIGATION, OR (2) AN ADDITIONAL PERIOD OF TIME NOT IN EXCESS OF ONE YEAR MAY BE AUTHORIZED OR APPROVED BY THE HEAD OF THE AGENCY OR HIS DESIGNEE WHEN HE DETERMINES THAT CIRCUMSTANCES JUSTIFYING THE EXCEPTION EXIST WHICH PRECLUDED SETTLEMENT WITHIN THE INITIAL ONE YEAR PERIOD OF THE SALE/PURCHASE CONTRACTS OR LEASE TERMINATION ARRANGEMENT ENTERED INTO IN GOOD FAITH BY THE EMPLOYEE WITHIN THE INITIAL ONE-YEAR PERIOD. THE CIRCUMSTANCES WHICH ARE DETERMINED BY THE HEAD OF THE AGENCY OR HIS DESIGNEE TO JUSTIFY THE EXCEPTION UNDER (2) ABOVE SHALL BE SET FORTH IN WRITING."

THIS OFFICE HAS CONSISTENTLY HELD THAT THIS REGULATION IS STATUTORY IN NATURE, HAVING THE FORCE AND EFFECT OF LAW. ACCORDINGLY, REIMBURSEMENT OF EXPENSES OF REAL ESTATE TRANSACTIONS INCURRED INCIDENT TO TRANSFERS OF OFFICIAL STATION, OTHERWISE ALLOWABLE, MAY NOT BE ALLOWED IN THE ABSENCE OF COMPLIANCE WITH THE ABOVE-STATED TIME LIMITATIONS WITHIN WHICH A RESIDENCE MUST BE BOUGHT OR SOLD. SEE 47 COMP. GEN. 753 (1968); B-166317, MAY 9, 1969; B-172911, JUNE 21, 1971; B-175348, APRIL 12, 1972, COPIES ENCLOSED.

WE RECOGNIZE THAT MR. HART'S CLAIM IS BASED ON THE OCCURRENCE OF AN ACT OF GOD WHICH PREVENTED COMPLIANCE WITH THE TIME LIMITATION OF THE REGULATIONS. HOWEVER, THE REGULATIONS DO NOT PERMIT ANY FURTHER EXTENSION FOR ANY REASON WHATSOEVER. THEREFORE, SINCE MR. HART HAS RECEIVED THE MAXIMUM EXTENSION OF TIME PERMITTED BY THE REGULATION WITHIN WHICH TO SELL HIS FORMER RESIDENCE, NO LEGAL AUTHORITY EXISTS UNDER WHICH HE MAY BE GRANTED A FURTHER EXTENSION AS REQUESTED. HOWEVER, IN VIEW OF THE EXTRAORDINARY CIRCUMSTANCES OF THIS CASE WE BELIEVE IT MERITS A REPORT TO THE CONGRESS UNDER PROVISIONS OF THE MERITORIOUS CLAIMS ACT OF APRIL 10, 1928, 45 STAT. 413, 31 U.S.C. 236, WITH A RECOMMENDATION FOR ENACTMENT OF RELIEF LEGISLATION. OUR REPORT AND RECOMMENDATION WILL BE FORWARDED TO THE CONGRESS IN ACCORDANCE WITH THIS DETERMINATION.