A-84703, OCTOBER 13, 1937, 17 COMP. GEN. 329

A-84703: Oct 13, 1937

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THERE IS NO AUTHORITY FOR DEDUCTING FROM PAYMENTS TO THE CONTRACTOR ANY AMOUNT ON ACCOUNT OF SUCH DAMAGE. WHILE THE EFFECTS WERE IN ITS CUSTODY AWAITING TRANSSHIPMENT ON AN ARMY TRANSPORT. THE COST OF SUCH LABOR AND MATERIAL IS PROPERLY FOR DEDUCTION FROM PAYMENTS UNDER THE CONTRACT FOR PACKING AND CRATING. 1937: THERE IS FOR CONSIDERATION YOUR REQUEST FOR DECISION WHETHER. THE FACTS APPEARING ARE AS FOLLOWS: DURING THE SUMMER OF 1936. AUTHORITY WAS GRANTED FOR THE SHIPMENT OF THEIR HOUSEHOLD GOODS UNDER THE PROVISIONS OF SECTION 5 (D) OF THE RIVER AND HARBOR ACT OF JANUARY 21. THE GOODS WERE PACKED AND CRATED UNDER GOVERNMENT INSPECTION AND DELIVERED BY THE CONTRACTOR TO THE ST. UPON DELIVERY IN NEW YORK IT APPEARS THAT THE SHIPMENTS WERE INSPECTED AND IT WAS FOUND NECESSARY TO "RECONDITION" THE SHIPMENTS OF BOBZIEN AND SWANSON.

A-84703, OCTOBER 13, 1937, 17 COMP. GEN. 329

PROPERTY - PRIVATE - DAMAGES - HOUSEHOLD EFFECTS OF CIVILIAN EMPLOYEES ON CHANGE OF STATION - GOVERNMENT AND PACKING CONTRACTOR'S LIABILITY SECTION 5 (D) OF THE RIVER AND HARBOR ACT OF JANUARY 21, 1927, 44 STAT. 1021, AUTHORIZING REIMBURSEMENT FOR EXPENSES "INCURRED BY CIVILIAN EMPLOYEES ON RIVER AND HARBOR WORKS FOR PACKING, CARTING, HAULING, AND TRANSPORTING HOUSEHOLD EFFECTS, * * * WHEN MAKING PERMANENT CHANGE OF TION," DOES NOT AUTHORIZE REIMBURSEMENT TO THE EMPLOYEES FOR DAMAGES WHICH MAY RESULT FROM THE PACKING AND MOVING OF SUCH EFFECTS FROM THE OLD STATION TO THE NEW STATION, AND WHERE THE GOVERNMENT HAS CONTRACTED FOR THE PACKING AND CRATING, THERE IS NO AUTHORITY FOR DEDUCTING FROM PAYMENTS TO THE CONTRACTOR ANY AMOUNT ON ACCOUNT OF SUCH DAMAGE, NOTWITHSTANDING THE DAMAGE MAY BE DUE TO IMPROPER PACKING. WHERE THE GOVERNMENT HAS CONTRACTED FOR PACKING AND CRATING OF PRIVATE HOUSEHOLD EFFECTS IN CONNECTION WITH A CIVILIAN EMPLOYEE'S PERMANENT CHANGE OF STATION, AND HAS INCURRED EXPENSES FOR LABOR AND MATERIAL IN THE NECESSARY REPLACING AND REINFORCING OF BROKEN PIECES OF CRATING, BECAUSE OF DEFECTIVE CRATING AND POOR PACKING, WHILE THE EFFECTS WERE IN ITS CUSTODY AWAITING TRANSSHIPMENT ON AN ARMY TRANSPORT, THE COST OF SUCH LABOR AND MATERIAL IS PROPERLY FOR DEDUCTION FROM PAYMENTS UNDER THE CONTRACT FOR PACKING AND CRATING.

ACTING COMPTROLLER GENERAL ELLIOTT TO LIEUTENANT COLONEL R. C. CRAWFORD, UNITED STATES ARMY, OCTOBER 13, 1937:

THERE IS FOR CONSIDERATION YOUR REQUEST FOR DECISION WHETHER, IN MAKING PAYMENT ON VOUCHER IN THE AMOUNT OF $172.48 IN FAVOR OF COLLIER'S TERMINAL WAREHOUSE AND VAN CO., OCALA, FLA., FOR SERVICES RENDERED IN PACKING FOR SHIPMENT OF CERTAIN FURNISHINGS AND HOUSEHOLD GOODS UNDER FOUR INFORMAL CONTRACTS CONSISTING OF PURCHASE ORDERS WITH SPECIFICATIONS ATTACHED, DEDUCTIONS OF $14.12 AND $153.05, AGGREGATING $167.17, PROPERLY MAY BE MADE.

STATED BRIEFLY AS MAY BE, THE FACTS APPEARING ARE AS FOLLOWS: DURING THE SUMMER OF 1936, ORDERS ISSUED TRANSFERRING MARION D. HOGAN, GAYLE MCFADDEN, TAGE R. SWANSON, AND KARL F. BOBZIEN, CIVIL EMPLOYEES OF THE ENGINEER DEPARTMENT, FROM OCALA, FLA., TO HONOLULU, HAWAII, FOR PERMANENT DUTY, AND AUTHORITY WAS GRANTED FOR THE SHIPMENT OF THEIR HOUSEHOLD GOODS UNDER THE PROVISIONS OF SECTION 5 (D) OF THE RIVER AND HARBOR ACT OF JANUARY 21, 1927, 44 STAT. 1021. THEREAFTER, THE UNITED STATED ENGINEER OFFICER AT OCALA MADE INFORMAL CONTRACTS WITH THE COLLIER'S TERMINAL WAREHOUSE AND VAN CO., HEREINAFTER CALLED THE COMPANY, FOR PACKING AND CRATING THE SAID HOUSEHOLD GOODS FOR WATER SHIPMENT. THESE CONTRACTS CONSISTED OF PURCHASE ORDERS ISSUED TO THE COMPANY BY THE PURCHASING AGENT, UNITED STATES ENGINEER'S OFFICE, OCALA, FLA., "FOR THE DISTRICT ENGINEER," INSTRUCTING THE COMPANY TO FURNISH ALL LABOR AND MATERIAL AND PERFORM ALL WORK REQUIRED FOR PACKING AND SHIPMENT IN ACCORDANCE WITH THE SPECIFICATIONS ATTACHED THERETO.

THE GOODS WERE PACKED AND CRATED UNDER GOVERNMENT INSPECTION AND DELIVERED BY THE CONTRACTOR TO THE ST. JOHN RIVER LINE CO., WHICH IN TURN DELIVERED THEM TO THE CLYDE-MALLORY LINES AT JACKSONVILLE, FLA., FOR TRANSPORTATION TO NEW YORK. THE LATTER COMPANY MADE DELIVERY TO THE PORT QUARTERMASTER, UNITED STATES ARMY PORT OF EMBARKATION.

UPON DELIVERY IN NEW YORK IT APPEARS THAT THE SHIPMENTS WERE INSPECTED AND IT WAS FOUND NECESSARY TO "RECONDITION" THE SHIPMENTS OF BOBZIEN AND SWANSON, SUCH RECONDITIONING APPARENTLY CONSISTING IN REPLACING OR REINFORCING SOME BROKEN PIECES OF CRATING. THE AGGREGATE COST OF THIS WORK ON THE TWO SHIPMENTS WAS $14.12.

THERE AFTER, THE SHIPMENTS WERE LOADED UPON ARMY TRANSPORTS AND DELIVERED AT HONOLULU. UPON ARRIVAL THERE THE FOUR SHIPMENTS WERE UNCRATED AND INSPECTED, VARIOUS ITEMS OF BREAKAGE AND OTHER DAMAGE WERE DISCOVERED, AND THE RESPECTIVE OWNERS FILED ITEMIZED LISTS OF DAMAGES INCURRED, TOGETHER WITH THE ACTUAL OR ESTIMATED COST OF REPAIRS OR REPLACEMENTS, IN VARYING AMOUNTS AS FOLLOWS:

TABLE

HOGAN ---------------------------------------------------- $24.10

MCFADDEN ------------------------------------------------- 75.60

SWANSON -------------------------------------------------- 21.45

BOBZIEN -------------------------------------------------- 31.90

TOTAL -------------------------------------------------- 153.05

THE OWNERS STATED THAT THE DAMAGE SUSTAINED WAS DUE TO FAULTY AND IMPROPER CRATING AND PACKING AND REQUESTED THAT CLAIMS FOR THE DAMAGE BE MADE ON THE CONTRACTOR FOR THEIR BENEFIT. THE CLAIMS WERE FORWARDED BY FIRST ENDORSEMENT OF THE DISTRICT ENGINEER, HONOLULU, HAWAII, TO THE DISTRICT ENGINEER, JACKSONVILLE, FLA., WITH THE STATEMENT THAT IN THE OPINION OF HIS OFFICE THE DAMAGES LISTED WERE DUE TO IMPROPER PACKING AND CRATING. THE DISTRICT ENGINEER AT THE PORT OF EMBARKATION, NEW YORK, DETERMINED THAT THE DAMAGE TO THE SHIPMENTS OF BOBZIEN AND SWANSON, WHICH WAS CORRECTED IN NEW YORK, WAS DUE TO DEFECTIVE CRATING AND POOR PACKING. THE CLAIMS WERE PRESENTED PURSUANT TO PARAGRAPH 4 OF THE SPECIFICATIONS ACCOMPANYING THE SEVERAL PURCHASE ORDERS, WHICH IS AS FOLLOWS:

LIABILITY FOR DAMAGE.--- THE CONTRACTOR WILL BE HELD LIABLE IN THE AMOUNT OF $10.00 PER HUNDREDWEIGHT, FOR ANY DAMAGE, CONCEALED ON OTHERWISE, WHICH IS CLEARLY THE RESULT OF IMPROPER PACKING, CRATING, OR HANDLING. HOWEVER, IF IT IS STATED ON THE ORDER THAT THE GOODS HAVE A HIGHER VALUATION THAN $10.00 PER HUNDRED WEIGHT, THE CONTRACTOR SHALL BE LIABLE FOR SUCH HIGHER VALUATION, PROVIDED THAT HE HAS STATED THE ADDITIONAL CHARGE, IF ANY, FOR SUCH INCREASED VALUATION, AND THAT THE ADDITIONAL CHARGE IS INDICATED ON THE ORDER AS A SEPARATE ITEM. PAYMENT WILL BE DEFERRED ON SERVICES FOR TEN DAYS FROM THE DATE OF THE ARRIVAL OF THE GOODS AT DESTINATION IN ORDER TO DETERMINE THEIR CONDITION ON ARRIVAL. THE DECISION OF THE DISTRICT ENGINEER OR HIS AUTHORIZED REPRESENTATIVE AT DESTINATION WILL BE ACCEPTED BY ALL PARTIES CONCERNED ON ALL SUCH DAMAGE.

IT IS FUNDAMENTAL, OF COURSE, THAT NO CONTRACT OR PURCHASE ON BEHALF OF THE UNITED STATES CAN BE MADE UNLESS IT IS AUTHORIZED BY LAW. SECTION 3732, REVISED STATUTES, AND ACT OF JUNE 12, 1906, 34 STAT. 255 (41 U.S.C. 11).

THE STATUTE RELIED UPON AS AUTHORITY FOR MAKING THE CONTRACTS HERE INVOLVED IS SECTION 5 (D) OF THE RIVER AND HARBOR ACT HEREINBEFORE CITED, WHICH READS AS FOLLOWS:

ACTUAL EXPENSES HERETOFORE AND HEREAFTER INCURRED BY CIVILIAN EMPLOYEES ON RIVER AND HARBOR WORKS FOR PACKING, CRATING, HAULING, AND TRANSPORTING HOUSEHOLD EFFECTS, WITHIN THE WEIGHT LIMITS AS PRESCRIBED IN ARMY REGULATIONS, WHEN MAKING PERMANENT CHANGE OF STATION UNDER COMPETENT ORDERS, MAY, ON APPROVAL OF THE CHIEF OF ENGINEERS, BE PAID OR REIMBURSED FROM FUNDS PERTAINING TO RIVER AND HARBOR WORKS.

IT WOULD APPEAR FROM A CAREFUL READING OF THE STATUTE THAT IT DOES NOT CONTEMPLATE THAT THE UNITED STATES SHALL, IN THE FIRST INSTANCE, ENTER INTO ANY CONTRACT WITH PRIVATE PARTIES FOR PACKING, CRATING, HAULING, AND TRANSPORTING HOUSEHOLD EFFECTS OF CIVILIAN EMPLOYEES, BUT THAT, ON THE CONTRARY, IT CONTEMPLATES THE EXPENSES SHALL, IN THE FIRST PLACE, BE INCURRED BY THE EMPLOYEE IN HIS OWN PERSONAL CAPACITY, AND THEN BE PAID OR REIMBURSED TO HIM BY THE GOVERNMENT. THE PROPERTY INVOLVED AND THE WORK INVOLVED ARE PERSONAL TO THE EMPLOYEE. THE PROPERTY IS HIS PROPERTY AND WHEN HE IS "MAKING PERMANENT CHANGE OF STATION UNDER COMPETENT ORDERS" HE IS AT LIBERTY TO TAKE IT WITH HIM, LEAVE IT BEHIND, SELL IT, OR GIVE IT AWAY, AND WHICHEVER HE DOES WILL BE NO CONCERN OF THE GOVERNMENT. THE APPARENT IMPORT OF THE STATUTE IS THAT IN THE EVENT HE DOES ELECT TO HAVE HIS HOUSEHOLD EFFECTS, ETC., PACKED, CRATED, HAULED, AND TRANSPORTED TO HIS NEW STATION, THE GOVERNMENT WILL PAY OR REIMBURSE HIM FOR THE EXPENSES INCURRED AND NOT BURDEN HIM WITH ASSUMING SUCH EXPENSES OUT OF HIS OWN POCKET. HOWEVER, CONCEDING THAT, FOR REASONS OF PUBLIC ECONOMY, THE STATUTE IMPLIES AUTHORITY TO ENTER INTO A CONTRACT IN THE NAME OF THE GOVERNMENT FOR THE WORK REQUIRED, THE STATUTE EXPRESSLY LIMITS THE PAYMENT OR REIMBURSEMENT WHICH MAY BE MADE TO EXPENSES INCURRED FOR PACKING, CRATING, HAULING, AND TRANSPORTING THE PROPERTY. IT DOES NOT AUTHORIZE PAYMENT OR REIMBURSEMENT TO HIM BY ANY MEANS, DIRECT OR INDIRECT, OF ANY AMOUNT TO COVER DAMAGES TO THE PROPERTY WHICH MAY RESULT FROM ITS PACKING AND REMOVAL FROM THE OLD STATION TO THE NEW, WHETHER SUCH DAMAGE BE DUE TO IMPROPER CRATING AND PACKING, ROUGH HANDLING EN ROUTE, OR TO ANY OTHER CAUSE WHATSOEVER. SUCH DAMAGE TO THE PROPERTY IS NOT AN EXPENSE INCURRED BY THE CIVILIAN EMPLOYEE FOR THE PACKING AND TRANSPORTATION, BUT IS LOSS SUSTAINED AS A RESULT OF SUCH PACKING AND TRANSPORTATION. THE LOSS OR DAMAGE IS PERSONAL TO THE EMPLOYEE, AND THE EMPLOYEE HAS NO CLAIM ON THE GOVERNMENT FOR PAYMENT OR REIMBURSEMENT IN ANY WAY, SUCH RIGHTS AS HE MAY HAVE BEING AGAINST THOSE RESPONSIBLE FOR THE DAMAGE, WHOEVER THEY MAY BE. MOREOVER, THERE APPEARS NO STATUTORY AUTHORITY FOR ANY UNDERTAKING TO BIND THE GOVERNMENT TO ACT AS AGENT FOR THE EMPLOYEE TO COLLECT ANY AMOUNT FROM THE CONTRACTOR FOR THE BENEFIT OF SAID EMPLOYEE. AS SAID BY THE COURT OF CLAIMS IN TAGGART V. UNITED STATES, 17 CT.CLS. 322: "IN THE ABSENCE OF STATUTE AUTHORITY, NEITHER THE ACCOUNTING OFFICERS OF THE TREASURY NOR ANY OTHER PUBLIC OFFICER CAN MAKE THE UNITED STATES AGENTS OR TRUSTEES FOR THE COLLECTION OF PRIVATE DEBTS BETWEEN CITIZENS NOR MAKE CONTRACTS IN RELATION TO THE TAKING OF SECURITY FOR THE PAYMENT OF DEBTS DUE TO THE GOVERNMENT, SO AS TO BIND THE UNITED STATES FOR ANY BREACH OF THE CONTRACT BY NEGLECT OR OTHERWISE.' WHILE THE CASE THERE INVOLVED WAS NOT SIMILAR TO THE PRESENT, THE RULE LAID DOWN IS APPOSITE, THAT THE GOVERNMENT CANNOT BE MADE AGENT OR TRUSTEE FOR THE COLLECTION OF DEBTS IN WHICH THE GOVERNMENT HAS NO ACTUAL CONCERN. AND SEE ALSO 15 COMP. DEC. 38.

SO FAR AS THE DAMAGES TO THE PROPERTY ITSELF ARE CONCERNED, THE GOVERNMENT HAS SUSTAINED NO LOSS, DAMAGE, OR EXPENSE, AND THERE APPEARS NO LEGAL BASIS FOR WITHHOLDING ANY AMOUNT FROM PAYMENT TO THE CONTRACTOR UPON SUCH A THEORY; AND SINCE THERE IS NO AUTHORITY FOR WITHHOLDING ANY AMOUNT FROM PAYMENTS OTHERWISE DUE TO THE CONTRACTOR FOR THE BENEFIT OF THE EMPLOYEES INVOLVED, DEDUCTION OF THE ITEM OF $153.05, REPRESENTING STATED DAMAGES TO THE PROPERTY OF THE EMPLOYEES, IS NOT AUTHORIZED.

THE ITEM OF $14.12 STANDS UPON A DIFFERENT FOOTING. AS HEREINBEFORE SET OUT, WHEN THE SHIPMENTS OF BOBZIEN AND SWANSON WERE UNLOADED AT THE PORT OF EMBARKATION, BROOKLYN, N.Y., THEY WERE INSPECTED AND FOUND TO BE IN POOR CONDITION, THE NOTATION ON THE QUARTERMASTER CORPS MANIFEST IN EACH INSTANCE BEING THAT: "SHIPMENT IN BAD CONDITION; VERY POOR PACKING; OLD, REUSED LUMBER.' IT WAS NECESSARY TO RECONDITION THESE TWO SHIPMENTS FOR TRANSSHIPMENT BY ARMY TRANSPORT SERVICE FROM NEW YORK TO HONOLULU, THE WORK NECESSARY APPARENTLY CONSISTING OF REPLACING BROKEN PIECES OF CRATING AND REINFORCING SAME. THIS WORK WAS DONE BY THE ARMY BASE STOREHOUSE AT A COST TO THE GOVERNMENT FOR LABOR AND MATERIAL OF $7.06 EACH SHIPMENT, COMPOSING SAID ITEM OF $14.12. THE AMOUNT INVOLVED WAS ACTUAL OUT-OF- POCKET EXPENSE INCURRED BY THE GOVERNMENT. THE DISTRICT ENGINEER, NEW YORK CITY, DETERMINED THAT THE DAMAGE NECESSITATING THIS RECONDITIONING WAS DUE TO DEFECTIVE CRATING AND POOR PACKING. THAT FINDING IS BINDING UPON THE CONTRACTOR UNDER THE PROVISIONS OF THE CONTRACT.

ACCORDINGLY, FROM THE TOTAL AMOUNT OTHERWISE DUE COLLIER'S TERMINAL WAREHOUSE AND VAN CO. ON THE VOUCHER SUBMITTED, THERE IS FOR DEDUCTION THE ITEM OF $14.12 EXPENDED BY THE UNITED STATES IN PUTTING THE SHIPMENTS OF BOBZIEN AND SWANSON IN CONDITION FOR OCEAN SHIPMENT. THE BALANCE IS FOR PAYMENT TO THE CONTRACTOR.