B-12229, SEPTEMBER 23, 1940, 20 COMP. GEN. 175

B-12229: Sep 23, 1940

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

PAYING OUT MONEY IN PURSUANCE OF ANY STATUTE OR ORDER OF COURT" IS NOT CHARGEABLE ON AMOUNTS WHICH. ARE DEPOSITED AND COVERED INTO THE TREASURY OF THE UNITED STATES PURSUANT TO AN ORDER OF COURT ISSUED IN ACCORDANCE WITH THE PROVISIONS OF 28 U.S.C. 852. 1940: I HAVE YOUR LETTER OF SEPTEMBER 6. AN ORDER WAS ENTERED BY THIS COURT DIRECTING THAT SUNDRY ITEMS AGGREGATING $4. THIS ORDER WAS PREPARED AND SUBMITTED TO THE COURT BY MR. WHICH NUMBER MANY HUNDREDS IS NOT RELEVANT HERE. THE OPINION OF THE EXAMINER WAS THAT IT DID NOT. OUR REASONS ARE. THE 1 PERCENT CHARGE IS MADE ONLY ON MONEYS "RECEIVED. THE UNCLAIMED AMOUNTS UNDER CONSIDERATION ARE NOT "PAID OUT" IN THE ORDINARY AND NATURAL SENSE OF THE WORDS AS USED IN THE STATUTE.

B-12229, SEPTEMBER 23, 1940, 20 COMP. GEN. 175

COURTS - CLERKS - FEES - AMOUNTS TRANSFERRED FROM COURT REGISTRIES TO UNITED STATES TREASURY THE FEE TO BE COLLECTED BY CLERKS OF THE UNITED STATES DISTRICT COURTS IN ACCORDANCE WITH THE PROVISIONS OF 28 U.S.C. 555,"FOR RECEIVING, KEEPING, AND PAYING OUT MONEY IN PURSUANCE OF ANY STATUTE OR ORDER OF COURT" IS NOT CHARGEABLE ON AMOUNTS WHICH, HAVING BEEN IN THE REGISTRY OF A COURT FOR FIVE YEARS OR MORE, ARE DEPOSITED AND COVERED INTO THE TREASURY OF THE UNITED STATES PURSUANT TO AN ORDER OF COURT ISSUED IN ACCORDANCE WITH THE PROVISIONS OF 28 U.S.C. 852.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE CLERK, UNITED STATES COURT, DISTRICT OF COLORADO, SEPTEMBER 23, 1940:

I HAVE YOUR LETTER OF SEPTEMBER 6, 1940, AS FOLLOWS:

I RESPECTFULLY REQUEST YOUR OPINION ON THE FACTS RECITED BELOW INVOLVING THE PROPRIETY OF COLLECTING OR NOT COLLECTING THE 1 PERCENT POUNDAGE REQUIRED BY TITLE 28, SEC. 555, PARAGRAPH 8, UNITED STATES CODE, THE RELEVANT PARTS OF WHICH READ AS FOLLOWS:

"IN ADDITION TO THE FEES FOR SERVICES RENDERED IN CASES, HEREINBEFORE ENUMERATED, THE CLERK SHALL CHARGE AND COLLECT, FOR MISCELLANEOUS SERVICES PERFORMED BY HIM AND HIS ASSISTANTS, EXCEPT WHEN ON BEHALF OF THE UNITED STATES, THE FOLLOWING FEES: * * *

"8. FOR RECEIVING, KEEPING, AND PAYING OUT MONEY IN PURSUANT OF ANY STATUTE OR ORDER OF THE COURT, INCLUDING CASH BAIL OR BONDS OR SECURITIES AUTHORIZED BY LAW TO BE DEPOSITED IN LIEU OF OTHER SECURITY, 1 PERCENTUM OF THE AMOUNT SO RECEIVED, KEPT AND PAID OUT, OR OF THE FACE VALUE OF SUCH BONDS OR SECURITIES.'

ON JULY 13, 1940, AN ORDER WAS ENTERED BY THIS COURT DIRECTING THAT SUNDRY ITEMS AGGREGATING $4,743.35, WHICH HAD REMAINED ON DEPOSIT IN THE REGISTRY OF THE COURT FOR A PERIOD OF FIVE YEARS OR MORE, SHOULD BE PAID TO THE TREASURY OF THE UNITED STATES, PURSUANT TO TITLE 28, SEC. 852, U.S.C. THIS ORDER WAS PREPARED AND SUBMITTED TO THE COURT BY MR. CHARLES F. MCCARTHY, EXAMINER OF THE DEPARTMENT OF JUSTICE, AFTER HIS EXAMINATION OF THE REGISTRY LEDGER.

THE ITEMS MAKING UP THE ABOVE AGGREGATE CONSIST IN GENERAL OF UNCLAIMED BALANCES OF COSTS, UNEARNED FEES IN BANKRUPTCY, AND UNCLAIMED FUNDS BELONGING TO BANKRUPT ESTATES AND PAID INTO THE REGISTRY BY THE REFEREE, BUT AS I VIEW THE SITUATION, THE EXACT SOURCE OF THE VARIOUS ITEMS, WHICH NUMBER MANY HUNDREDS IS NOT RELEVANT HERE, THE QUESTION BEING WHETHER ANY TRANSFER OF FUNDS, UNCLAIMED FOR FIVE YEARS, FROM A COURT OF THE UNITED STATES TO THE TREASURY OF THE UNITED STATES REQUIRES THE 1 PERCENT DEDUCTION.

THE OPINION OF THE EXAMINER WAS THAT IT DID NOT, AND I AND THE DEPUTIES WHO HANDLE THE FINANCES OF THIS OFFICE AGREE WITH HIM. OUR REASONS ARE, VERY BRIEFLY, THESE:

1. THE 1 PERCENT CHARGE IS MADE ONLY ON MONEYS "RECEIVED, KEPT, AND PAID OUT" BY THE CLERK. THE UNCLAIMED AMOUNTS UNDER CONSIDERATION ARE NOT "PAID OUT" IN THE ORDINARY AND NATURAL SENSE OF THE WORDS AS USED IN THE STATUTE, WHERE THEY APPEAR TO MEAN "PAID OUT TO AND FOR THE USE OF SOME PERSON TO WHOM THE ITEM BELONGS.' THIS IS NOT THE CASE HERE, WHERE MONEY HELD IN THE REGISTRY IN TRUST FOR INDIVIDUALS IS TRANSFERRED TO THE TREASURY TO BE STILL HELD IN TRUST FOR THE SAME INDIVIDUALS, PARTLY TO RELIEVE THE COURT REGISTRY OF OBSOLETE ITEMS AND PARTLY TO AVAIL THE UNITED STATES, BY GIVING IT USE OF AND CONTROL OVER FUNDS, THE BULK OF WHICH WILL PROBABLY NEVER BE RECLAIMED. THE TRANSACTION IS MERELY A CHANGE OF DEPOSITARY.

2. SUPPORTING THIS CONCLUSION ARE SECS. 851 AND 852, TITLE 28, U.S. CODE, BY WHICH THOSE TRANSFERS TO THE TREASURY AFTER FIVE YEARS ARE GOVERNED. IN PURSUANCE OF SEC. 851, THE MONEYS IN QUESTION HAVE BEEN AND NOW ARE "DEPOSITED WITH * * * A DESIGNATED DEPOSITARY OF THE UNITED TES.' SEC. 852 PROVIDES THAT AFTER FIVE YEARS,"IT SHALL BE THE DUTY OF THE JUDGE * * * TO CAUSE SUCH MONEY TO BE DEPOSITED IN THE TREASURY OF THE UNITED STATES," ETC. IN OTHER WORDS THE TRANSFER OF THE TREASURY IS MERELY A SHIFTING OF MONEY FROM A LOCAL DEPOSITARY OF THE GOVERNMENT TO A GENERAL DEPOSITARY OF THE GOVERNMENT AND A TRANSFER OF ITS CUSTODY FROM ONE SET OF GOVERNMENT OFFICIALS TO ANOTHER SET.

3. ASIDE FROM THE ABOVE CONSIDERATIONS, IT SHOULD ALSO BE NOTED THAT THE 1 PERCENT IS NOT CHARGED WHEN THE CLERK PERFORMS SERVICE "ON BEHALF OF THE UNITED STATES.' IS THIS TRANSFER OF FUNDS SUCH A SERVICE? IT CANNOT BE A SERVICE ON BEHALF OF THE CLAIMANTS, SINCE THE RESULT IS TO MAKE IT MORE DIFFICULT FOR THEM TO OBTAIN MONEY TO WHICH THEY ARE ENTITLED. IT APPEARS TO BE A MEASURE DESIGNED TO BENEFIT THE GOVERNMENT BY ENABLING ONE OFFICE TO RELIEVE ITS BOOKS OF A LARGE NUMBER OF SMALL ACCOUNTS AND ANOTHER OFFICE TO RECEIVE, HOLD, AND PRESUMABLY USE, AD INTERIM THE AGGREGATE SUM.

IF, THEREFORE, YOU SHOULD CONSIDER THAT THE 1 PERCENT PROVISION APPLIES, PLEASE ALSO RULE WHETHER OR NOT THE CHARGE SHOULD BE MADE A CONSTRUCTIVE ONE. THE MAIN QUESTION, HOWEVER, IS WHETHER THE 1 PERCENT POUNDAGE CHARGE IS PROPER AT ALL WHEN MONEY IS MERELY TRANSFERRED FROM ONE GOVERNMENT DEPOSITARY TO ANOTHER.

YOUR UNDERSTANDING OF THE MATTER APPEARS TO BE CORRECT. WHILE SECTION 557, TITLE 28, UNITED STATES CODE, PLACING CLERKS OF UNITED STATES COURTS ON A SALARY BASIS CONTINUED THE REQUIREMENTS OF THE COLLECTION OF FEES IN ACCORDANCE WITH SECTION 555 AND OTHER SECTIONS OF THE SAME TITLE OF THE CODE, SUCH COLLECTIONS TO BE COVERED INTO THE TREASURY OF THE UNITED STATES, THERE APPEARS TO BE NOTHING IN THOSE SECTIONS AUTHORIZING THE CHARGING OF THE FEE OF 1 PERCENT ON THE FUNDS TO WHICH YOU REFER.

IN A DECISION OF THE FORMER COMPTROLLER OF THE TREASURY, 15 COMP. DEC. 325, IT WAS HELD THAT CLERKS OF UNITED STATES COURTS WERE NOT ENTITLED TO FEES FOR DEPOSIT BY THEM IN THE UNITED STATES TREASURY OF BALANCES DUE THE GOVERNMENT AS SUCH ACTION WAS NOT SUCH "RECEIVING, KEEPING, AND PAYING OUT MONEY" AS TO BRING IT WITHIN THE FEE BILL. THE POSSESSION OF FUNDS BY THE CLERK IN HIS OFFICIAL CAPACITY IS OSTENSIBLY POSSESSION BY THE UNITED STATES, AND THE MERE CHANGE IN THE PLACE OF DEPOSIT, OR THE GOVERNMENT AGENCY WHICH MAY HAVE CONTROL OVER SUCH FUNDS, DOES NOT CONSTITUTE A PAYING OUT OF THE MONEY WITHIN THE PURVIEW OF THE FEE BILL. IT MUST BE HELD, THEREFORE, THAT THE ONE PERCENT POUNDAGE FEE IS NOT CHARGEABLE ON THE AMOUNT OF $4,743.35 WHICH IS NOT TO BE "PAID T," BUT MERELY DEPOSITED AND COVERED INTO THE TREASURY OF THE UNITED STATES PURSUANT TO A PROPER COURT ORDER ISSUED UNDER THE STATUTORY PROVISION WHICH YOU CITE.