B-113776, APRIL 16, 1953, 32 COMP. GEN. 454

B-113776: Apr 16, 1953

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PAY - ADDITIONAL - NAVAL RESERVE OFFICERS OF THE MEDICAL AND DENTAL CORPS - SERVICE AS INTERNS IN MUNICIPAL HOSPITALS NAVAL RESERVE OFFICER ON ACTIVE DUTY AS AN INTERN IN A MUNICIPAL HOSPITAL WHO IS PAID COMPENSATION FOR THE PERFORMANCE OF THE SERVICE REQUIRED OF HIM AS A RESERVE OFFICER ON ACTIVE DUTY RECEIVES THE COMPENSATION INCIDENT TO HIS DUTIES FOR THE BENEFIT OF THE UNITED STATES. 1953: FURTHER REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 1. WHICH DISALLOWED YOUR CLAIM FOR REFUND OF $876 WHICH WAS CHECKED IN YOUR PAY ACCOUNT AS REPRESENTING COMPENSATION PAID TO YOU BY THE ST. THE INDICATED CHECK AGE WAS EFFECTED IN RESPONSE TO A REQUEST OF THE GENERAL ACCOUNTING OFFICE DATED APRIL 29.

B-113776, APRIL 16, 1953, 32 COMP. GEN. 454

PAY - ADDITIONAL - NAVAL RESERVE OFFICERS OF THE MEDICAL AND DENTAL CORPS - SERVICE AS INTERNS IN MUNICIPAL HOSPITALS NAVAL RESERVE OFFICER ON ACTIVE DUTY AS AN INTERN IN A MUNICIPAL HOSPITAL WHO IS PAID COMPENSATION FOR THE PERFORMANCE OF THE SERVICE REQUIRED OF HIM AS A RESERVE OFFICER ON ACTIVE DUTY RECEIVES THE COMPENSATION INCIDENT TO HIS DUTIES FOR THE BENEFIT OF THE UNITED STATES, AND THEREFORE, THE COMPENSATION SHOULD BE COLLECTED FROM THE OFFICER AND COVERED INTO THE TREASURY AS MISCELLANEOUS RECEIPTS.

ASSISTANT COMPTROLLER GENERAL YATES TO EDWARD L. PINNEY, JR., M.D., APRIL 16, 1953:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 1, 1953, REQUESTING REVIEW OF THAT PART OF GENERAL ACCOUNTING OFFICE SETTLEMENT DATED DECEMBER 15, 1952, WHICH DISALLOWED YOUR CLAIM FOR REFUND OF $876 WHICH WAS CHECKED IN YOUR PAY ACCOUNT AS REPRESENTING COMPENSATION PAID TO YOU BY THE ST. LOUIS CITY HOSPITAL, ST. LOUIS, MISSOURI, DURING THE PERIOD JULY 1, 1949, TO JUNE 30, 1950, INCIDENT TO YOUR SERVICE AS A NAVAL RESERVE OFFICER ON ACTIVE DUTY AS AN OFFICER-INTERN AT THAT HOSPITAL.

THE INDICATED CHECK AGE WAS EFFECTED IN RESPONSE TO A REQUEST OF THE GENERAL ACCOUNTING OFFICE DATED APRIL 29, 1952, BASED ON DECISION OF OCTOBER 6, 1949, 29 COMP. GEN. 163, IN WHICH IT WAS HELD THAT COMPENSATION PAID BY A PRIVATE HOSPITAL TO AN OFFICER-INTERN INCIDENT TO SERVICES PERFORMED AT SUCH HOSPITAL IN HIS OFFICIAL CAPACITY AS A NAVAL RESERVE OFFICER ON ACTIVE DUTY SHOULD BE CONSIDERED AS RECEIVED FOR THE ACCOUNT AND BENEFIT OF THE GOVERNMENT AND CONSEQUENTLY SHOULD BE COLLECTED FROM THE OFFICER AND COVERED INTO THE TREASURY. YOU STATE THE BELIEF, HOWEVER, THAT THAT DECISION HELD THAT OFFICER-INTERNS MIGHT LEGALLY ACCEPT COMPENSATION FROM HOSPITALS WHOSE FUNDS ARE DERIVED FROM THE FUNDS OF A MUNICIPALITY AND SO IS NOT AUTHORITY FOR THE CHECK AGE MADE AGAINST YOU, THE ST. LOUIS HOSPITAL BEING SUPPORTED BY MUNICIPAL FUNDS.

IN THE CITED DECISION OF OCTOBER 6, 1949, REFERENCE WAS MADE TO THE PROVISIONS OF 18 U.S.C., SUPP. II, 1914 (ACT OF JUNE 25, 1948, 62 STAT. 793), MAKING IT A CRIMINAL OFFENSE FOR AN OFFICER OR EMPLOYEE OF THE GOVERNMENT TO RECEIVE ANY SALARY IN CONNECTION WITH HIS SERVICES FROM ANY SOURCE OTHER THAN THE UNITED STATES GOVERNMENT "EXCEPT AS MAY BE CONTRIBUTED OUT OF THE TREASURY OF ANY STATE, COUNTY OR MUNICIPALITY.' WOULD APPEAR FROM THE LEGISLATIVE HISTORY OF THAT PROVISION THAT THE PRIMARY PURPOSE OF SUCH EXCEPTION WAS TO PERMIT THE CONTINUANCE OF COOPERATIVE PROJECTS FINANCED IN PART BY THE FEDERAL GOVERNMENT AND IN PART BY LOCAL GOVERNMENT. GRANTING, HOWEVER, THAT THE STRICT CONSTRUCTION REQUIRED OF A CRIMINAL STATUTE WOULD BRING CASES LIKE THE PRESENT ONE WITHIN THE LANGUAGE OF THE EXCEPTION, INSOFAR AS CRIMINAL PROSECUTION MIGHT BE INVOLVED, IT DOES NOT FOLLOW THAT SUCH EXCEPTION HAD THE EFFECT OF AUTHORIZING THE RETENTION OF ADDITIONAL COMPENSATION FROM SUCH SOURCES CONTRARY TO GENERALLY RECOGNIZED PRINCIPLES OF EXISTING LAW.

THE RELATIONSHIP BETWEEN THE GOVERNMENT AND ITS OFFICERS, AGENTS, AND EMPLOYEES IS, IN MANY RESPECTS, NOT MATERIALLY DIFFERENT FROM THAT FOUND IN PRIVATE ENTERPRISE, AND GOVERNMENT PERSONNEL ARE SUBJECT TO THE APPLICATION OF THE RULES GOVERNING THE COMPENSATION OF OFFICERS, AGENTS, AND EMPLOYEES GENERALLY IN THE ABSENCE OF STATUTORY PROVISION TO THE CONTRARY. SEE 65 C.J. 1278. IN THE USUAL EMPLOYER EMPLOYEE RELATIONSHIP IT IS WELL ESTABLISHED THAT EARNINGS OF AN EMPLOYEE IN EXCESS OF HIS REGULAR COMPENSATION GAINED IN THE COURSE OF, OR IN CONNECTION WITH, HIS SERVICES BELONG TO THE EMPLOYER. SEE VAN MOY V. WILLIS, 14 SO.2D 185; CONNELLY V. SPECIAL ROAD AND BRIDGE DISTRICT NO. 5, 126 SO. 794; ANNOTATIONS IN 13 ALR 907 AND 71 ALR 933; AND 56 C.J.S., MASTER AND SERVANT, SECTION 71. SIMILARLY, AN AGENT MAY BE HELD ACCOUNTABLE FOR PROFITS IN EXCESS OF HIS LAWFUL COMPENSATION WHICH HE ACQUIRES DURING THE COURSE OF THE AGENCY THROUGH AGREEMENTS WITH THIRD PERSONS WITH WHOM HE DEALS FOR THE PRINCIPAL. SEE 3 C.J.S. AGENCY, SECTION 165, AND CASES CITED. ALSO, IT IS AN ESTABLISHED PRINCIPLE OF LAW THAT A PUBLIC OFFICE IS A PUBLIC TRUST AND THAT THE HOLDER THEREOF MAY NOT USE IT DIRECTLY OR INDIRECTLY FOR A PERSONAL PROFIT. SEE VILLAGE OF BROOKFIELD V. PENTIS, 101 F.2D 516; HULGAN V. GLEDHILL ET AL, 61 SE2D 473; HALLIDAY ET AL V. NORFOLK AND WESTERN RY. CO. ET AL., 62 NE2D 716. MOREOVER, LONG BEFORE OCTOBER 6, 1949, THIS OFFICE HAD HELD THAT QUARTERS FURNISHED AN OFFICER BY AN AGENCY NOT A PART OF THE UNITED STATES GOVERNMENT BUT INCIDENT TO HIS DUTIES AS AN OFFICER OF SUCH GOVERNMENT MUST BE DEEMED AS FURNISHED ON BEHALF OF, AND FOR THE BENEFIT OF, THE UNITED STATES AND NOT AS AN EXTRA OR ADDITIONAL EMOLUMENT TO THE OFFICER. SEE 21 COMP. GEN. 1065; 27 ID. 479. AND, IN PRINCIPLE, IT WOULD SEEM TO BE IMMATERIAL WHETHER THE THING OF VALUE FURNISHED THE OFFICER ON BEHALF OF THE GOVERNMENT IS QUARTERS OR MONEY OR SOME OTHER RIGHT OR ITEM OF PROPERTY.

UNDER SUCH PRINCIPLES OF LAW IT WOULD APPEAR THAT INASMUCH AS YOU WERE ON ACTIVE DUTY AS AN OFFICER OF THE NAVAL RESERVE DURING THE PERIOD JULY 1, 1949, TO JUNE 30, 1950, AND RECEIVED ACTIVE DUTY PAY AND ALLOWANCES IN FULL FROM THE GOVERNMENT FOR THAT SERVICE, THE COMPENSATION RECEIVED FROM THE ST. LOUIS CITY HOSPITAL (WHICH RECEIVED THE BENEFIT OF SUCH SERVICES PAID FOR BY THE GOVERNMENT) PROPERLY WAS CONSIDERED AS HAVING BEEN RECEIVED FOR THE ACCOUNT AND BENEFIT OF THE GOVERNMENT, EVEN THOUGH IT WAS NOT IN VIOLATION OF THE SAID PROVISION IN THE CRIMINAL CODE.

ON SUCH BASIS THE CONCLUSION IS REQUIRED THAT THE DISALLOWANCE OF YOUR CLAIM FOR REFUND OF THE $876 CHECKED IN YOUR PAY ACCOUNT WAS CORRECT AND, CONSEQUENTLY, THE SETTLEMENT OF DECEMBER 15, 1952, IS SUSTAINED.