B-223865, B-223881, AUG 22, 1986, OFFICE OF THE GENERAL COUNSEL
Highlights
DISBURSING OFFICERS - RELIEF - ERRONEOUS PAYMENTS - NOT RESULT OF BAD FAITH OR NEGLIGENCE DIGEST: RELIEF IS GRANTED ARMY DISBURSING OFFICIAL AND HIS DEPUTIES UNDER 31 U.S.C. PROPER PROCEDURES WERE FOLLOWED IN THE ISSUANCE OF THE SUBSTITUTE CHECKS. THERE WAS NO INDICATION OF BAD FAITH ON THE PART OF THE DISBURSING OFFICIAL AND HIS DEPUTIES. SUBSEQUENT COLLECTION ATTEMPTS ARE BEING PURSUED. WE WILL DENY RELIEF IF ARMY DELAYS MORE THAN 3 MONTHS IN FORWARDING THE DEBT TO ITS COLLECTION DIVISION. RELIEF IS GRANTED. THE SUBSTITUTE CHECKS WERE ISSUED ON THE BASIS OF EACH PAYEE'S ALLEGATION THAT THE ORIGINAL CHECK HAD NOT BEEN RECEIVED AND A REQUEST FOR STOP PAYMENT HAD BEEN MADE. THE SUBSTITUTE CHECKS WERE ISSUED BY THE ARMY UNDER AUTHORITY DELEGATED BY THE DEPARTMENT OF THE TREASURY. 31 C.F.R.
B-223865, B-223881, AUG 22, 1986, OFFICE OF THE GENERAL COUNSEL
DISBURSING OFFICERS - RELIEF - ERRONEOUS PAYMENTS - NOT RESULT OF BAD FAITH OR NEGLIGENCE DIGEST: RELIEF IS GRANTED ARMY DISBURSING OFFICIAL AND HIS DEPUTIES UNDER 31 U.S.C. SEC. 3527(C) FROM LIABILITY FOR IMPROPER PAYMENTS RESULTING FROM PAYEE'S NEGOTIATION OF BOTH ORIGINAL AND SUBSTITUTE MILITARY CHECKS. PROPER PROCEDURES WERE FOLLOWED IN THE ISSUANCE OF THE SUBSTITUTE CHECKS, THERE WAS NO INDICATION OF BAD FAITH ON THE PART OF THE DISBURSING OFFICIAL AND HIS DEPUTIES, AND SUBSEQUENT COLLECTION ATTEMPTS ARE BEING PURSUED. HOWEVER, FOR LOSSES RECORDED AFTER JUNE 1, 1986, WHERE THE PAYEE HAS LEFT THE ARMY OR ITS EMPLOY, WE WILL DENY RELIEF IF ARMY DELAYS MORE THAN 3 MONTHS IN FORWARDING THE DEBT TO ITS COLLECTION DIVISION.
MR. CLYDE E. JEFFCOAT:
PRINCIPAL DEPUTY COMMANDER
U.S. ARMY FINANCE AND
ACCOUNTING CENTER
INDIANAPOLIS, INDIANA 46249
THIS RESPONDS TO YOUR TWO REQUESTS OF AUGUST 1, 1986, THAT WE RELIEVE MAJOR (MAJ) T. WAGNER, DSSN 5577, FINANCE AND ACCOUNTING OFFICER, U.S. ARMY FINANCE AND ACCOUNTING CENTER, EUROPE, AND HIS DEPUTIES, SERGEANT FIRST CLASS (SFC) W. H. STOW AND MR. J. R. BLEVINS, UNDER 31 U.S.C. SEC. 3527(C) FOR TWO IMPROPER PAYMENTS, A $527.31 CHECK PAYABLE TO MS. PATRICIA G. ANDERSON AND $387.63 CHECK PAYABLE TO MS. KATHLEEN J. BOGGAN. FOR THE REASONS STATED BELOW, RELIEF IS GRANTED.
IN BOTH INSTANCES, THE LOSS RESULTED WHEN THE PAYEE NEGOTIATED BOTH THE ORIGINAL AND A SUBSTITUTE CHECK. THE SUBSTITUTE CHECKS WERE ISSUED ON THE BASIS OF EACH PAYEE'S ALLEGATION THAT THE ORIGINAL CHECK HAD NOT BEEN RECEIVED AND A REQUEST FOR STOP PAYMENT HAD BEEN MADE. THE SUBSTITUTE CHECKS WERE ISSUED BY THE ARMY UNDER AUTHORITY DELEGATED BY THE DEPARTMENT OF THE TREASURY. 31 C.F.R. SEC. 245.8.
IT APPEARS THAT THE REQUEST FOR STOP PAYMENT AND THE ISSUANCE OF THE SUBSTITUTE CHECKS IN THESE CASES WERE WITHIN THE BOUNDS OF DUE CARE AS ESTABLISHED BY ARMY REGULATIONS. SEE AR 37-103, PARAS. 4-161, 4-162 AND 4 -164. THERE WAS NO INDICATION OF BAD FAITH ON THE PART OF THE DISBURSING OFFICERS AND IT APPEARS THAT ADEQUATE COLLECTION EFFORTS ARE NOW BEING MADE. ACCORDINGLY, WE GRANT RELIEF.
ALTHOUGH WE HAVE GRANTED RELIEF TO THE DISBURSING OFFICERS IN THESE CASES, WE DO NOT BELIEVE THAT THE ARMY'S COLLECTION PROCEDURES, TAKEN TOGETHER, MEET THE DILIGENT CLAIMS COLLECTION REQUIREMENT OF 31 U.S.C. SEC. 3527(C). ONCE THE DEBIT VOUCHERS WERE RECEIVED FROM TREASURY, IT TOOK ARMY OVER 20 MONTHS IN ONE CASE AND ALMOST 2 YEARS IN THE OTHER TO REFER THESE MATTERS TO YOUR COLLECTION DIVISION. AS WE PREVIOUSLY INDICATED TO YOU, FOR LOSSES RECORDED AFTER JUNE 1, 1986, WHERE THE PAYEE HAS LEFT THE ARMY OR ITS EMPLOY, WE WILL NO LONGER GRANT RELIEF IF ARMY DELAYS MORE THAN 3 MONTHS IN FORWARDING THE DEBT TO YOUR COLLECTION DIVISION. HOWEVER, SINCE THESE CASES OCCURRED PRIOR TO THAT DATE, WE WILL NOT DENY RELIEF HERE.