B-190122, NOV 23, 1977

B-190122, NOV 23, 1977

FIRST CONTRACT FOR SALE OF TRANSFERRED EMPLOYEE'S HOUSE AT FORMER DUTY STATION FELL THROUGH WHEN PURCHASER DIED PRIOR TO SETTLEMENT. HOUSE WAS SUBSEQUENTLY SOLD TO ANOTHER PARTY. AGENCY DENIED EMPLOYEE'S CLAIM FOR REIMBURSEMENT OF ATTORNEY'S FEES FOR SERVICES INCIDENT TO UNCONSUMMATED SALE. AGENCY DENIAL OF EMPLOYEE'S CLAIM WAS CORRECT AS THIS OFFICE HAS HELD THAT FEES AND COSTS ASSOCIATED WITH UNSUCCESSFUL EFFORTS TO SELL HOUSE ARE NOT REIMBURSABLE.

JOHN J. MAZZOLA - DUPLICATE ATTORNEY'S FEES:

THIS ACTION IS AT THE REQUEST OF MS. MARIE A. BELL, AN AUTHORIZED CERTIFYING OFFICER WITH THE BUREAU OF ALCOHOL, TOBACCO, AND FIREARMS, DEPARTMENT OF THE TREASURY. SHE REQUESTS AN ADVANCE DECISION CONCERNING THE CLAIM OF MR. JOHN J. MAZZOLA, AN EMPLOYEE OF THE BUREAU, FOR ATTORNEY FEES INCURRED INCIDENT TO A RELOCATION OF HIS PERMANENT DUTY STATION.

INCIDENT TO A TRANSFER FROM CHICAGO, ILLINOIS, TO TUCSON, ARIZONA, MR. MAZZOLA ENTERED INTO A CONTRACT WITH MR. AND MRS. GREY FOR THE SALE OF HIS RESIDENCE AT HIS FORMER DUTY STATION. BEFORE THE CLOSING COULD BE HELD, MR. GREY DIED AND THE CONTRACT OF SALE WAS NOT CONSUMMATED. THE HOUSE WAS PUT BACK ON THE MARKET AND WAS SUBSEQUENTLY SOLD TO MR. AND MRS. SCHILLINGER, THE CLOSING BEING HELD ON APRIL 16, 1976. MR. MAZZOLA CLAIMED REINBURSEMENT FOR ATTORNEY FEES THAT HE INCURRED FOR LEGAL SERVICES RENDERED TO HIM INCIDENT TO BOTH THE GREY CONTRACT AND THE SUBSEQUENT RESALE TO THE SCHILLINGER'S.

AN ITEMIZATION OF THE FEES WAS PROVIDED BY MR. MAZZOLA'S ATTORNEY, AND IS AS FOLLOWS:

1. INITIAL CONFERENCE WITH CLIENT. $50.00 2. DRAFTING CONTRACT (MAZZOLA - GREY) $25.00 3. ORDERING AND PAYING FOR TITLE $ 5.00 4. PREPARATION OF THE FOLLOWING DOCUMENTS ( (MAZZOLA - GREY) WARRANTY DEED $15.00 AFFIDAVIT OF TITLE, BILL OF SALE AND ILLINOIS STATE TRANSFER DECLARATION $30.00 5. ADVISING CLIENT ON CONTRACT (MAZZOLA - SCHILLINGER) $15.00 6. OBTAINING WAIVERS FOR TITLE OBJECTIONS $22.50 7. PREPARATION OF DOCUMENTS INVOLVED IN SALE $60.00 8. APPEARING AT CLOSING (FLAT FEE). $75.00 9. PREPARATION AND DELIVERY OF DOCUMENTS RELATING TO THE ASSUMPTION OF CLIENT'S MORTGAGE WITH CLYDE SAVINGS. $15.00 10. SECURING CLIENT'S DAMAGES FROM ALEXIA GREY AFTER CLYDE SAVINGS WITHDREW THEIR APPROVAL OF THE ASSUMPTION $37.50

TOTAL FEE $350.00

IN OUR RECENT DECISION IN MATTER OF GEORGE W. LAY, 56 COMP.GEN. 561, 1977, WE REVIEWED THE POLICY CONCERNING THE EXTENT TO WHICH LEGAL FEES MAY BE REIMBURSED, AND WE HELD THAT NECESSARY AND REASONABLE LEGAL FEES, EXCEPT FOR THE FEES AND COSTS OF LITIGATION, MAY BE REIMBURSED IF CUSTOMARILY CHARGED IN THE LOCALITY OF THE RESIDENTIAL TRANSACTION. THIS DECISION REPRESENTS A DEPARTURE FROM OUR PRIOR DECISIONS WHICH REQUIRED ITEMIZATION OF THE LEGAL FEES TO ENSURE THAT ONLY CERTAIN ENUMERATED SERVICES WERE REIMBURSED. HOWEVER, OUR DECISION IN LAY HAS BEEN APPLIED PROSPECTIVELY ONLY TO CASES IN WHICH SETTLEMENT OF THE TRANSACTION TOOK PLACE ON OR AFTER APRIL 27, 1977. SEE MATTER OF JAMES B. O'BRIEN, B-185548, JULY 19, 1977. SINCE THE SETTLEMENT IN THE PRESENT CASE OCCURRED ON APRIL 16, 1976, OUR DECISION IN LAY WOULD NOT BE APPLICABLE TO MAZZOLA'S CLAIM.

IN MATTER OF ROBERT A. BENSON, B-184869, SEPTEMBER 21, 1976, WE HELD THAT AN EMPLOYEE COULD BE REIMBURSED FOR EXPENSES INCURRED INCIDENT TO THE DRAFTING OF ONLY ONE OF FOUR CONTRACTS PREPARED INCIDENT TO 4 SEPARATE ATTEMPTS TO SELL A RESIDENCE. THE HOLDING WAS BASED ON THE THEORY THAT THE INTENT OF THE APPLICABLE PROVISIONS OF THE FEDERAL TRAVEL REGULATIONS RELATING TO REIMBURSEMENT OF REAL ESTATE EXPENSES, IS TO REIMBURSE THE EMPLOYEE FOR ONLY ONE SET OF AUTHORIZED EXPENSES RELATING TO ONE SALE AND ONE PURCHASE. ACCORDINGLY, ITEMS 1 THROUGH 4 AND NUMBER 10 OF THE ITEMIZED BILL FOR LEGAL FEES RENDERED WOULD NOT BE FOR REIMBURSEMENT INSOFAR AS THEY RELATE TO THE UNCONSUMMATED GREY CONTRACT.

THE REGULATION GOVERNING THE REIMBURSEMENT OF TRANSFER-RELATED LEGAL EXPENSES IS PARAGRAPH 2-6.2C OF THE FEDERAL TRAVEL REGULATIONS, FPMR 101-7 (MAY 1973) (FTR), WHICH PROVIDES THAT:

"LEGAL AND RELATED EXPENSES. TO THE EXTENT SUCH COSTS HAVE NOT BEEN INCLUDED IN BROKERS' OR SIMILAR SERVICES FOR WHICH REIMBURSEMENT IS CLAIMED UNDER OTHER CATEGORIES, THE FOLLOWING EXPENSES ARE REIMBURSABLE WITH RESPECT TO THE SALE AND PURCHASE OF RESIDENCES IF THEY ARE CUSTOMARILY PAID BY THE SELLER OF A RESIDENCE AT THE OLD OFFICIAL STATION *** TO THE EXTENT THEY DO NOT EXCEED AMOUNTS CUSTOMARILY CHARGED IN THE LOCALITY OF THE RESIDENCE *** COSTS OF PREPARING CONVEYANCES, OTHER INSTRUMENTS, AND CONTRACTS AND RELATED NOTARY FEES AND RECORDING FEES; COSTS OF MAKING SURVEYS, PREPARING DRAWINGS OR PLOTS WHEN REQUIRED FOR LEGAL OR FINANCING PURPOSES; AND SIMILAR EXPENSES. COSTS OF LITIGATION ARE NOT REIMBURSABLE."

THE REMAINING ITEMS 6 THROUGH 9 APPEAR TO RELATE TO THE SCHILLINGER CONTRACT, AND IF THEY DO SO RELATE, THEN ITEMS 6, 7 AND 9 ARE FOR REIMBURSEMENT IF THEY ARE CUSTOMARILY PAID FOR BY THE SELLER AT THE LOCATION OF THE OLD DUTY STATION. ITEMS 5 AND 8 ARE ADVISORY IN NATURE, AND AS SUCH ARE NOT REIMBURSABLE. SEE B-175328, SEPTEMBER 21, 1972. THUS MR. MAZZOLA IS ENTITLED TO A TOTAL OF $97.50 FOR LEGAL EXPENSES IF THE SELLER CUSTOMARILY PAYS SUCH EXPENSES AT CHICAGO.

ACTION ON THE VOUCHER SHOULD BE TAKEN IN ACCORDANCE WITH THE FOREGOING.