A-94933, JULY 15, 1938, 18 COMP. GEN. 41

A-94933: Jul 15, 1938

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CHECKS - FORGERIES - POSTMASTER'S CASHING LIABILITY WHERE IMPOSTOR OF SAME NAME AS PAYEE WAS NOT DEALT WITH BY CHECK ISSUING OFFICER A POSTMASTER WHO CASHED A GOVERNMENT CHECK UPON THE SPURIOUS INDORSEMENT OF THE PAYEE'S NAME MAY NOT BE RELIEVED FROM LIABILITY WHERE THE GOVERNMENT IN ISSUING THE CHECK DID NOT DEAL WITH THE IMPOSTER EITHER DIRECTLY OR INDIRECTLY. NOTWITHSTANDING THE CHECK WAS ISSUED SUBSEQUENT TO THE DEATH OF THE PAYEE AND INDORSED BY A PERSON OF THE SAME NAME. 6 COMP. THIS CHECK WAS SUBSEQUENTLY DISHONORED FOR THE REASON THAT IT WAS PRESENTED BY A WESLEY COLEMAN FIVE MONTHS AFTER THE DEATH OF THE PAYEE. THE POSTMASTER AT BIRMINGHAM HAS ATTEMPTED TO COLLECT THE AMOUNT FROM THE PERSON TO WHOM PAYMENT WAS MADE.

A-94933, JULY 15, 1938, 18 COMP. GEN. 41

CHECKS - FORGERIES - POSTMASTER'S CASHING LIABILITY WHERE IMPOSTOR OF SAME NAME AS PAYEE WAS NOT DEALT WITH BY CHECK ISSUING OFFICER A POSTMASTER WHO CASHED A GOVERNMENT CHECK UPON THE SPURIOUS INDORSEMENT OF THE PAYEE'S NAME MAY NOT BE RELIEVED FROM LIABILITY WHERE THE GOVERNMENT IN ISSUING THE CHECK DID NOT DEAL WITH THE IMPOSTER EITHER DIRECTLY OR INDIRECTLY, NOTWITHSTANDING THE CHECK WAS ISSUED SUBSEQUENT TO THE DEATH OF THE PAYEE AND INDORSED BY A PERSON OF THE SAME NAME. 6 COMP. GEN. 532, DISTINGUISHED.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE POSTMASTER GENERAL, JULY 15, 1938:

THERE HAS BEEN RECEIVED LETTER DATED MAY 10, 1938 (FILE MO-HHN), FROM THE THIRD ASSISTANT POSTMASTER GENERAL AS FOLLOWS:

UNDER THE PROVISIONS OF SECTION 114, POSTAL LAWS AND REGULATIONS OF 1924, THE POSTMASTER AT BIRMINGHAM, ALA., CASHED CHECK NO. 835701, ISSUED ON APRIL 1, 1928, UNDER SYMBOL NO. 11-006, IN FAVOR OF WESLEY COLEMAN, R.F.D. NO. 2, ADAMSVILLE, ALA., FOR $62.50.

THIS CHECK WAS SUBSEQUENTLY DISHONORED FOR THE REASON THAT IT WAS PRESENTED BY A WESLEY COLEMAN FIVE MONTHS AFTER THE DEATH OF THE PAYEE. THE POSTMASTER AT BIRMINGHAM HAS ATTEMPTED TO COLLECT THE AMOUNT FROM THE PERSON TO WHOM PAYMENT WAS MADE, BUT A SATISFACTORY SETTLEMENT CANNOT BE REACHED.

COPIES OF LETTERS RECEIVED FROM THE POSTMASTER AT BIRMINGHAM, TOGETHER WITH CORRESPONDENCE PREVIOUSLY HELD ON FILE AT HIS OFFICE, ARE ENCLOSED FOR YOUR INFORMATION.

THE SAME REASONING IS BELIEVED TO BE APPLICABLE AND THE CASE IS SIMILAR TO ONE DECIDED BY YOU ON FEBRUARY 14, 1927 (A-17334), WHICH WAS ADDRESSED TO THE SECRETARY OF THE TREASURY, AND YOU ARE RESPECTFULLY REQUESTED TO DIRECT THAT THE CHECK BE HONORED BECAUSE OF THE ERROR OF THE ADMINISTRATIVE OFFICER WHO ISSUED THE CHECK FIVE MONTHS AFTER THE DEATH OF THE PAYEE.

PLEASE INFORM ME OF THE ACTION YOU DIRECT IN THIS CASE THAT THE POSTMASTER AT BIRMINGHAM MAY BE PROPERLY INSTRUCTED.

IT APPEARS THAT AN APPLICATION FOR THE BENEFITS OF WORLD WAR ADJUSTED COMPENSATION ACT WAS SUBMITTED BY WESLEY COLEMAN AS FATHER OF CLIFTON COLEMAN, VETERANS' ADMINISTRATION NO. -3,882,016; XC-718,087. AN AWARD OF $625 WAS APPROVED IN FAVOR OF WESLEY COLEMAN AND SEVEN CHECKS FOR $62.50 EACH, INCLUDING ONE REFERRED TO, WERE ISSUED TO HIM BY WILLIAM H. HOLMES, DISBURSING OFFICER, SYMBOL 11-006.

INASMUCH AS WESLEY COLEMAN DIED NOVEMBER 22, 1927, IN ENSLEY, ALA., CHECK NO. 835,701 WAS ISSUED SUBSEQUENT TO HIS DEATH AND THE TREASURER OF THE UNITED STATES HAS BEEN AUTHORIZED TO RECLAIM SAID $62.50, FILE AWS-C- 5532. IT APPEARS THAT THE CHECK WAS FORGED AND CASHED AT THE BIRMINGHAM, ALA., POST OFFICE BY WESLEY COLEMAN, JR., WHO IS NOW EMPLOYED WITH A W.P.A. PROJECT AT OR NEAR LOS ANGELES, CALIF., AND WHO HAS PROMISED TO MAKE RESTITUTION IN SMALL INSTALLMENTS BEGINNING ON OR ABOUT APRIL 26, 1938.

THE THIRD PARAGRAPH OF POSTMASTER GREEN'S LETTER OF MAY 31, 1938, STATES:

THIS CHECK WAS CHARGED BACK TO THIS OFFICE BY THE BIRMINGHAM BRANCH OF THE FEDERAL RESERVE BANK, ATLANTA, GA., ON OCTOBER 18, 1937. IT WAS CARRIED AS "CASH" FOR SEVERAL DAYS, AND IN ORDER THAT IT MIGHT BE MORE EASILY HANDLED IT WAS SUBSEQUENTLY ADDED TO OUR "RESERVE" AND CHARGED IN WITH THE AMOUNT FOR WHICH RECEIPTS ARE HELD FROM THE SEVERAL STATIONS, THE CORRESPONDENCE IN REGARD TO IT SERVING AS A RECEIPT IN AND WITH THIS FUND OF $3,362.50, WHICH PRIOR TO THIS ITEM BEING CHARGED TO IT WAS $3,300.00. THE PHOTOSTATIC COPY OF THE CHECK THAT CAME TO US WHEN IT WAS CHARGED BACK BY THE BANK WAS LOANED TO AN AGENT OF THE DEPARTMENT OF JUSTICE, AND HAS NOT BEEN RETURNED.

THE AUTHORIZED MONEY ORDER RESERVE OF THE BIRMINGHAM, ALA., POST OFFICE IS $12,000. SEE SECTION 1510, POSTAL LAWS AND REGULATIONS, 1932.

SECTION 114, POSTAL LAWS AND REGULATIONS, 1924, PROVIDES:

2. POSTMASTERS MAY CASH WITH POSTAL FUNDS DISBURSING POSTMASTERS' CHECKS, PENSION CHECKS, POST OFFICE DEPARTMENT WARRANTS, POSTAL SAVINGS SYSTEM CHECKS, AND OTHER KINDS OF GOVERNMENT PAPER, PROVIDED THEY ARE RECEIVED FROM RESPONSIBLE PERSONS WHOSE INDORSEMENT ON SAID PAPER THE POSTMASTER IS WILLING TO GUARANTEE.

3. SUCH PAPER, AS WELL AS DRAFTS ISSUED BY NATIONAL OR STATE BANKS, MAY BE USED BY POSTMASTERS TO REMIT THEIR SURPLUS POSTAL FUNDS, PROVIDED THEY CAN MAKE SATISFACTORY ARRANGEMENTS WITH THEIR DEPOSITARIES TO RECEIVE THEM AT PAR. POSTMASTERS WILL BE HELD LIABLE ON THEIR OFFICIAL BONDS FOR ANY LOSSES OF GOVERNMENT FUNDS RESULTING FROM FAULT OR NEGLIGENCE ON THEIR PART.

IN THIS CONNECTION, THE RECORDS OF THIS OFFICE SHOW THAT JOHN G. BASS TOOK POSSESSION OF THE BIRMINGHAM, ALA., POST OFFICE AS ACTING POSTMASTER AUGUST 20, 1924, BOND ACCEPTED SEPTEMBER 3, 1924, SURETY, SOUTHERN SURETY CO.; THAT HE WAS APPOINTED POSTMASTER DECEMBER 9, 1924, BOND ACCEPTED DECEMBER 22, 1924, SURETY, SOUTHERN SURETY CO.; AND REAPPOINTED POSTMASTER DECEMBER 11, 1928, BOND ACCEPTED DECEMBER 20, 1938, SURETY, NATIONAL SURETY CO. A NEW BOND DATED DECEMBER 31, 1929, WAS ACCEPTED FEBRUARY 5, 1930, SURETY, GLOBE INDEMNITY CO. SEE ACT MARCH 3, 1905, 33 STAT. 1259; AND THAT W. COOPER GREEN TOOK POSSESSION OF THE POST OFFICE AS ACTING POSTMASTER MAY 8, 1933, AND SUBSEQUENTLY WAS APPOINTED POSTMASTER.

ALTHOUGH THE DATE IS NOT GIVEN IN THE CORRESPONDENCE, IT MAY BE ASSUMED THAT SINCE THE INVOLVED CHECK WAS DATED APRIL 1, 1928, IT WAS CASHED AT THE POST OFFICE AT BIRMINGHAM, ALA., WHILE MR. BASS WAS POSTMASTER. THEREFORE, THE SAID $62.50 SEEMS TO BE CHARGEABLE TO HIS ACCOUNT AND NOT TO THE ACCOUNT OF MR. GREEN.

SO FAR AS THE ACCOUNTS IN THIS OFFICE ARE CONCERNED, AN ADJUSTMENT WILL BE MADE BY CREDITING THE PRESENT POSTMASTER'S MONEY ORDER ACCOUNT WITH A TRANSFER FROM MONEY ORDER FUNDS AND CHARGING MR. BASS' POSTAL ACCOUNT WITH A TRANSFER OF SUCH FUNDS. MR. GREEN WILL BE ELIMINATED FROM FURTHER CONSIDERATION IN THIS MATTER AND THE FUTURE ACTION WILL BE BASED ON THE POSTAL ACCOUNT OF MR. BASS, INASMUCH AS THE CHECK WAS NO DOUBT PAID FROM POSTAL FUNDS AS PROVIDED IN THE REGULATIONS.

THE DECISION OF THIS OFFICE CITED IN THE LETTER OF THE THIRD ASSISTANT POSTMASTER GENERAL, 6 COMP. GEN. 532, IS NOT APPLICABLE IN THIS CASE. DECISION OF MAY 20, 1935, 14 COMP. GEN. 840, IT WAS HELD AS FOLLOWS (QUOTING FROM THE SYLLABUS):

WHERE THE GOVERNMENT DRAWS A CHECK TO THE ORDER OF A PROPER CLAIMANT AND MAILS SAME TO THE CORRECT ADDRESS BUT BY MISTAKE OF THE POSTMASTER THE CHECK FALLS INTO THE HANDS OF ANOTHER PERSON HAVING THE SAME NAME AS THE PAYEE, THE INDORSEMENT OF THE CHECK BY SUCH PERSON CONSTITUTES A FORGERY AND WILL NOT PROTECT A BANK WHICH INNOCENTLY CASHES SUCH CHECK--- THE MISTAKEN IDENTITY IN SUCH A CASE NOT INVOLVING THE DRAWER (THE GOVERNMENT) BUT INVOLVING RATHER THE BANK WHICH CASHED THE CHECK UPON THE SPURIOUS INDORSEMENT OF THE PAYEE'S NAME. 6 COMP. GEN. 532 DISTINGUISHED.

SEE ALSO 9 COMP. GEN. 476; 11 ID. 447; AND DECISION OF JUNE 2, 1938, A- 94478, 17 COMP. GEN. 1045.

IN THE INSTANT CASE, WHILE THE VETERAN'S ADMINISTRATION WAS AT FAULT IN ISSUING THE CHECK SUBSEQUENT TO THE DATE OF THE DEATH OF THE PAYEE, IT DID NOT DEAL WITH THE IMPOSTOR EITHER DIRECTLY OR INDIRECTLY. HENCE, THE DRAWER OF THE CHECK (THE GOVERNMENT) WAS NOT INVOLVED. THE RULE STATED IN THE DECISION OF MAY 20, 1935, SUPRA, RATHER THAN THE RULE STATED IN THE DECISION CITED BY THE THIRD ASSISTANT POSTMASTER GENERAL, VIZ, FEBRUARY 14, 1927, SUPRA, IS APPLICABLE, AND THE POSTMASTER WHO CASHED THE CHECK UPON THE SPURIOUS INDORSEMENT OF THE PAYEE'S NAME, ALTHOUGH BY A PERSON WITH THE SAME NAME, MAY NOT BE RELIEVED FROM LIABILITY, UNLESS AND UNTIL THERE HAS BEEN RECOVERY FROM THE IMPOSTOR.