A-79134, APRIL 27, 1937, 16 COMP. GEN. 962

A-79134: Apr 27, 1937

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COMPENSATION AND RETIREMENT DEDUCTIONS - SET-OFF PRIOR TO DEBTOR'S APPLICATION FOR AMOUNTS DUE THE EXERCISING OF THE COMMON-LAW RIGHT OF THE GOVERNMENT TO APPLY MONEYS DUE A DEBTOR FROM THE GOVERNMENT IN LIQUIDATION OF A GOVERNMENT INDEBTEDNESS IS NOT DEPENDENT UPON THE DEBTOR FILING A CLAIM FOR THE MONEYS OTHERWISE DUE. THE LAST PARAGRAPH IN SAID LETTER IN WHICH IT IS STATED THAT "PROPER STEPS SHOULD BE TAKEN TO WITHHOLD THE ENTIRE AMOUNT OF THE TWO VOUCHERS FROM THE AMOUNT STANDING TO HIS CREDIT IN THE RETIREMENT FUND. THERE HAVE ALSO BEEN CONSIDERED YOUR DECISIONS A-81277 AND A- 83276. IT IS FELT. IS A QUESTION FOR THE DETERMINATION OF YOUR OFFICE. EGAN WAS STATIONED IN THE FIELD AND.

A-79134, APRIL 27, 1937, 16 COMP. GEN. 962

COMPENSATION AND RETIREMENT DEDUCTIONS - SET-OFF PRIOR TO DEBTOR'S APPLICATION FOR AMOUNTS DUE THE EXERCISING OF THE COMMON-LAW RIGHT OF THE GOVERNMENT TO APPLY MONEYS DUE A DEBTOR FROM THE GOVERNMENT IN LIQUIDATION OF A GOVERNMENT INDEBTEDNESS IS NOT DEPENDENT UPON THE DEBTOR FILING A CLAIM FOR THE MONEYS OTHERWISE DUE, AND, SHOULD THE DEBTOR'S FINAL SALARY AS A FORMER GOVERNMENT EMPLOYEE NOT BE SUFFICIENT FOR COMPLETE LIQUIDATION, REQUEST SHOULD BE MADE UPON THE CIVIL SERVICE COMMISSION FOR APPLICATION OF THE AMOUNT TO HIS CREDIT IN THE RETIREMENT FUND, IN WHOLE OR IN PART AS THE CASE MIGHT BE, IN FURTHER LIQUIDATION OF THE INDEBTEDNESS.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF AGRICULTURE, APRIL 27, 1937:

THERE HAS BEEN RECEIVED YOUR LETTER OF APRIL 9, 1937, AS FOLLOWS:

IN CONNECTION WITH YOUR LETTER A-79134, OF JANUARY 15, 1937; THE DISALLOWANCE OF VOUCHERS IN THE AMOUNTS OF $111.12 AND $131.61 BECAUSE OF FALSE CERTIFICATION BY JOHN T. EGAN, FORMER SENIOR AGRICULTURAL ECONOMIST OF THE BUREAU OF PLANT INDUSTRY, AND THE LAST PARAGRAPH IN SAID LETTER IN WHICH IT IS STATED THAT "PROPER STEPS SHOULD BE TAKEN TO WITHHOLD THE ENTIRE AMOUNT OF THE TWO VOUCHERS FROM THE AMOUNT STANDING TO HIS CREDIT IN THE RETIREMENT FUND," THERE HAS BEEN CONSIDERED YOUR DECISION A-80384, OF OCTOBER 16, 1936, ON THE SUBJECT OF ADJUSTMENTS ON ACCOUNT OF OVERPAYMENTS OF SALARY IN CONNECTION WITH CLAIMS FOR REFUND OF RETIREMENT DEDUCTIONS. THERE HAVE ALSO BEEN CONSIDERED YOUR DECISIONS A-81277 AND A- 83276, OF NOVEMBER 13, 1936, AND FEBRUARY 17, 1937, RESPECTIVELY, ON THE USE OF RETIREMENT FUNDS FOR THE ADJUSTMENT OF APPROPRIATIONS ON ACCOUNT OF OVERDRAWN LEAVE, IN CASES INVOLVING THE CONSIDERATION OF CLAIMS FOR REFUND OF RETIREMENT DEDUCTIONS AND FINAL PAYMENTS IN CONNECTION THEREWITH.

IT DOES NOT APPEAR THAT THE PRINCIPLES OUTLINED IN THE CITED DECISIONS CAN BE APPLIED IN MR. EGAN'S CASE FOR THE REASON THAT TO DATE HE HAS NOT APPLIED FOR REFUND OF RETIREMENT DEDUCTIONS. IF THIS DEPARTMENT SHOULD NOW REQUEST THE CIVIL SERVICE COMMISSION TO WITHDRAW FROM THE AMOUNT TO MR. EGAN'S CREDIT IN THE RETIREMENT FUND AN AMOUNT EQUAL TO THE AMOUNTS OF THE TWO DISALLOWED VOUCHERS, FOR DEPOSIT TO THE CREDIT OF THE APPROPRIATION FROM WHICH PAID, ANY ACTION WHICH MIGHT BE TAKEN BY THE CIVIL SERVICE COMMISSION WOULD NOT BE IN CONNECTION WITH A CLAIM FOR REFUND NOR WITH A FINAL PAYMENT. THERE WOULD ALSO BE FOR CONSIDERATION THE LEGAL AUTHORITY FOR A SETTLEMENT PRIOR TO THE RECEIPT OF THE APPLICATION FOR REFUND, WHICH, IT IS FELT, IS A QUESTION FOR THE DETERMINATION OF YOUR OFFICE.

DURING THE LAST MONTH OF HIS SERVICE WITH THE DEPARTMENT, MR. EGAN WAS STATIONED IN THE FIELD AND, BECAUSE HE HAS FAILED, EVEN THOUGH SPECIFICALLY REQUESTED, TO CERTIFY TO THE ADMINISTRATIVE OFFICE, THE AMOUNT OF TIME SPENT ON OFFICIAL DUTY DURING THIS PERIOD, PAYMENT OF FINAL SALARY HAS NOT BEEN MADE. UNTIL FINAL SALARY HAS BEEN PAID HIM, HIS RETIREMENT CARD MAY NOT BE CERTIFIED TO THE CIVIL SERVICE COMMISSION, AND AS THERE MAY NOT BE SUFFICIENT FINAL SALARY TO SATISFY THE AMOUNTS DISALLOWED, FURTHER ADVICE ON THE ACTION WHICH MAY BE PROPERLY TAKEN AT THIS TIME IS REQUESTED.

WHILE THE CITED DECISIONS MAY BE INAPPOSITE AS TO THE FACTS HERE INVOLVED, THE PRINCIPLE THEREIN STATED IS NEVERTHELESS APPLICABLE.

THE DIRECTION STATED IN THE CONCLUDING PARAGRAPH OF MY DECISION OF JANUARY 15, 1937, TO YOU, THAT "PROPER STEPS SHOULD BE TAKEN TO WITHHOLD THE ENTIRE AMOUNT OF THE TWO VOUCHERS FROM THE AMOUNT STANDING TO HIS CREDIT IN THE RETIREMENT FUND FOR DEPOSIT TO THE CREDIT OF THE PROPER APPROPRIATION" WAS WITH THE THOUGHT THAT THE USUAL STEPS APPLICABLE IN THESE CASES WOULD BE TAKEN. IT WOULD APPEAR, HOWEVER, FROM YOUR LETTER THAT YOUR DEPARTMENT IS NOT FULLY COGNIZANT OF THE USUAL PROCEDURE OBTAINING IN THIS CLASS OF CASES.

THE UNITED STATES HAS THE RIGHT TO SET OFF AGAINST AN AMOUNT DUE A CLAIMANT (OTHER THAN AS CURRENT SALARY IN CERTAIN CASES) ANY SUM THE SAME PERSON OWES TO THE GOVERNMENT EITHER UNDER THE SAME OR OTHER CONTRACTS OR OBLIGATIONS. THE COMMON-LAW RIGHT OF EVERY CREDITOR TO APPLY THE MONEYS OF HIS DEBTOR IN HIS HANDS IN EXTINGUISHMENT OF CLAIMS DUE HIM FROM THE DEBTOR IS EQUALLY APPLICABLE TO THE GOVERNMENT AS TO INDIVIDUALS. 1 COMP. GEN. 605; 7 COMP. GEN. 576; 16 COMP. GEN. 161; JOHN F. L. O-LEARY V. UNITED STATES, 82 CT.CLS. 305. IN ORDER TO EXERCISE THIS RIGHT ON THE PART OF THE GOVERNMENT IT IS NOT NECESSARY THAT THERE BE FILED ANY SPECIFIC CLAIM BY THE DEBTOR FOR MONEYS DUE HIM FROM THE GOVERNMENT.

WHEN, THEREFORE, A PERSON IS INDEBTED TO ANY PARTICULAR DEPARTMENT OR AGENCY OF THE GOVERNMENT AND SUCH PERSON HAS MONEYS TO HIS CREDIT IN THE RETIREMENT FUND, THE DEPARTMENT OR AGENCY CONCERNED SHOULD TAKE IMMEDIATE STEPS TO FILE A CLAIM OR REQUEST WITH THE CIVIL SERVICE COMMISSION FOR APPLICATION OF THE AMOUNT TO HIS CREDIT IN THE RETIREMENT FUND, IN WHOLE OR IN PART AS THE CASE MIGHT BE, AGAINST HIS REPORTED INDEBTEDNESS TO THE GOVERNMENT. IN THIS CONNECTION THE FOLLOWING WAS SAID IN A DECISION DATED OCTOBER 16, 1936, A-80384, 16 COMP. GEN. 384, TO THE ACTING POSTMASTER GENERAL:

* * * HOWEVER, IN SUCH CASES, IT HAS BEEN THE GENERAL PRACTICE OF THE COMMISSION, BEFORE TAKING ANY ACTION IN THE MATTER OF APPLYING ANY PART OF THE AMOUNT OTHERWISE DUE AS REFUND OF RETIREMENT DEDUCTIONS AGAINST AN OVERPAYMENT OF COMPENSATION, TO REFER THE CASE HERE FOR CONSIDERATION UNDER THE PROVISIONS OF SECTION 236, REVISED STATUTES, AS AMENDED BY SECTION 305 OF THE ACT OF JUNE 10, 1921, 42 STAT. 24, AS FOLLOWS:

"ALL CLAIMS AND DEMANDS WHATEVER BY THE GOVERNMENT OF THE UNITED STATES OR AGAINST IT, AND ALL ACCOUNTS WHATEVER IN WHICH THE GOVERNMENT OF THE UNITED STATES IS CONCERNED, EITHER AS DEBTOR OR CREDITOR, SHALL BE SETTLED AND ADJUSTED IN THE GENERAL ACCOUNTING OFFICE.'

SEE ALSO, SECTION 4 OF THE ACT OF JULY 31, 1894, 28 STAT. 206, AS AMENDED BY SECTION 304 OF THE ACT OF JUNE 10, 1921, 42 STAT. 24, (31 U.S.C. 93).

ACCORDINGLY, IN THE INSTANT MATTER THERE SHOULD BE FOLLOWED THE USUAL PROCEDURE AS ABOVE STATED, IF, AFTER APPLICATION OF THE FINAL SALARY TO THE FORMER EMPLOYEE'S INDEBTEDNESS, AS PROPOSED, IT IS FOUND THAT THE EMPLOYEE'S INDEBTEDNESS IS NOT FULLY LIQUIDATED THEREBY.