B-125663, SEP. 6, 1956

B-125663, SEP. 6, 1956

TO THE SECRETARY OF HEALTH, EDUCATION, AND WELFARE:

REFERENCE IS MADE TO YOUR LETTER DATED MAY 15, 1956, RELATIVE TO THE DISPOSITION OF THE BALANCE OF PERSONAL FUNDS STANDING TO THE CREDIT OF MARY DEPENBROCK, A DECEASED PATIENT OF SAINT ELIZABETHS HOSPITAL, WHEREIN YOU ADVISE THAT THE HOSPITAL HAS RECEIVED A CLAIM TO SUCH FUNDS FROM THE DISTRICT OF COLUMBIA, APPARENTLY FOR REIMBURSEMENT FOR CARE AND MAINTENANCE PAYMENTS UNDER THE PROVISIONS OF 21 D.C. CODE 318, AND A LETTER FROM THE SON OF THE DECEASED INDICATING HE DESIRES TO FILE A FORMAL CLAIM AS LEGAL HEIR TO SUCH FUNDS. THE CITED SECTION OF THE D.C. CODE PROVIDES THAT THE ESTATE OF A DECEASED PATIENT SHALL BE LIABLE TO THE DISTRICT OF COLUMBIA FOR THE EXPENSE OF CARE AND MAINTENANCE AT THE HOSPITAL.

YOU STATE THAT, IF THE CLAIM OF THE SON IS RECEIVED PRIOR TO THE CLOSE OF THE FIRST FULL FISCAL YEAR FOLLOWING THE DATE OF THE PATIENT'S DEATH, THE HOSPITAL PROPOSES TO PAY THE BALANCE OF THE PERSONAL FUNDS TO THE SON WITHOUT FURTHER CONSIDERATION OF THE CLAIM OF THE DISTRICT OF COLUMBIA OR ANY OTHER CREDITORS. IF NO CLAIM IS RECEIVED FROM MR. DEPENBROCK WITHIN SUCH PERIOD THE HOSPITAL PROPOSES TO COVER THE MONEY INTO THE TREASURY IN ACCORDANCE WITH B-3271, MARCH 27, 1940. HOWEVER, IN VIEW OF THE POSSIBILITY THAT OUR DECISION OF DECEMBER 27, 1955 (B-125663), WAS INTENDED TO PLACE RESPONSIBILITY ON THE HOSPITAL TO ATTEMPT TO DISCOVER EXISTING CREDITORS OF THE DECEASED OR HIS ESTATE, TO DETERMINE THE VALIDITY OR RELATIVE PRIORITY POSITION OF THE CLAIMS OF SUCH CREDITORS, AND TO PAY PERSONAL FUNDS OF DECEASED PATIENTS IN SATISFACTION OF SUCH CLAIMS, YOU ASK TO BE ADVISED AS TO WHETHER OBJECTION WOULD BE MADE TO EITHER OF THE PROPOSED DISPOSITIONS IN THE ABOVE CASE.

UPON THE DEATH OF A PATIENT AT SAINT ELIZABETHS HOSPITAL, AUTHORITY FOR PAYMENT OF PERSONAL FUNDS DEPOSITED WITH THE SUPERINTENDENT TO HEIRS OF THE DECEASED IS GRANTED BY THE ACT OF JUNE 30, 1906, AS AMENDED, 24 U.S.C. 177, WHICH PROVIDES IN PERTINENT PART AS FOLLOWS:

"ALL MONEYS BELONGING TO DECEASED INMATES OF SAINT ELIZABETHS HOSPITAL AND DEPOSITED IN THE TREASURY BY THE DISBURSING AGENT AS AGENT, SHALL BE COVERED INTO THE TREASURY UNLESS CLAIMED BY HIS OR HER LEGAL HEIRS WITHIN FIVE YEARS FROM THE DEATH OF THE INMATE. AND THE SUPERINTENDENT OF SAINT ELIZABETHS HOSPITAL IS AUTHORIZED AND DIRECTED, UNDER SUCH REGULATIONS AS MAY BE PRESCRIBED BY THE SECRETARY OF HEALTH, EDUCATION, AND WELFARE, TO MAKE DILIGENT INQUIRY IN EVERY INSTANCE AFTER THE DEATH OF AN INMATE TO ASCERTAIN THE WHEREABOUTS OF HIS OR HER LEGAL HEIRS. * * *"

AN EXAMINATION OF THE LEGISLATIVE HISTORY OF THE ACT DISCLOSES THAT ONE OF ITS PURPOSES, IF NOT THE PRIMARY PURPOSE, WAS TO REMOVE FROM THE BOOKS OF THE GOVERNMENT THE NUMEROUS INDIVIDUAL ACCOUNTS OF DECEASED PATIENTS WHICH WERE PYRAMIDING WITH THE PASSAGE OF TIME. HOUSE DOCUMENT NO. 634, 59TH CONGRESS, 1ST SESSION, CONTAINS A LETTER FROM THE SECRETARY OF THE INTERIOR TRANSMITTING A DRAFT OF PROPOSED LEGISLATION WHICH PROVIDED FOR THE COVERING INTO THE TREASURY FUNDS OF DECEASED PATIENTS UNCLAIMED BY HEIRS WITHIN A PERIOD OF FIVE YEARS FROM THE DATE OF DEATH OF THE PATIENT, TO BE USED IN CONNECTION WITH THE ADMINISTRATION OF THE AFFAIRS OF THE HOSPITAL. IT WAS STATED IN THE SECRETARY'S LETTER AS FOLLOWS:

"UNDER THE CIRCUMSTANCES, THEREFORE, THE PROPRIETY OF PERMITTING THIS LARGE SUM OF MONEY, WHICH WILL BE AUGMENTED AS YEARS PASS BY, TO REMAIN IN THE TREASURY TO THE CREDIT OF THE SUPERINTENDENT AS AGENT, UNDER A NOMINAL BOND, WITHOUT PROVIDING ANY METHOD FOR ITS DISPOSITION IS, IN MY JUDGMENT, QUESTIONABLE.'

THE 1906 ACT, AS ENACTED, CONTAINED THE PROVISION FOR DILIGENT SEARCH FOR HEIRS BUT, INSTEAD OF PERMITTING THE FUNDS TO GO TO THE USE OF THE HOSPITAL AFTER FIVE YEARS, PROVIDED FOR COVERING SUCH FUNDS INTO THE TREASURY. WHILE IT IS TRUE THE SUPERINTENDENT OF THE HOSPITAL WAS AUTHORIZED TO SEEK OUT HEIRS AND WAS ALLOWED FIVE YEARS WITHIN WHICH TO LOCATE AND INFERENTIALLY PAY SUCH HEIRS, THERE IS NOTHING IN THE STATUTE MAKING IT MANDATORY TO PAY THE HEIRS TO THE EXCLUSION OF PREFERRED OR OTHER CREDITORS OF THE ESTATE OF THE DECEASED PATIENT. NO WHERE IN THE LEGISLATIVE HISTORY IS THERE ANY INDICATION THAT IT WAS INTENDED TO DEPRIVE CREDITORS OF THEIR JUST DUE. IN FACT, IT WAS HELD IN 16 COMP. DEC. 780, SEVERAL YEARS AFTER ENACTMENT OF THE 1906 ACT, THAT FUNERAL EXPENSES WERE A PROPER CHARGE AGAINST THE FUNDS OF A DECEASED PATIENT. ALSO, SEE 16 COMP. GEN. 1080, 17 ID. 383 AND B-744, FEBRUARY 6, 1939. SHOULD BE NOTED, HOWEVER, THAT IN EACH OF THESE CASES INVOLVING FUNDS WITHIN THE PURVIEW OF 24 U.S.C. 177, THE FUNDS WERE PAID OVER SPECIFICALLY FOR THAT PURPOSE. IT WELL COULD BE ARGUED THAT THE HEIRS WERE TO BE PAID ONLY THE AMOUNTS DUE AFTER PAYMENT OF CREDITORS AND THAT THE PURPOSE OF THE ACT WAS TO PERMIT THE SUPERINTENDENT TO EXTEND HIMSELF FURTHER THAN ORDINARILY WOULD BE THE CASE IN SEEKING OUT HEIRS BEFORE THE FUNDS WERE COVERED INTO THE TREASURY. APPARENTLY, NO CLAIMS OF CREDITORS, OTHER THAN THOSE SET OUT ABOVE WERE PRESENTED SO AS TO MAKE AN ISSUE OF THE MATTER. HOWEVER, IF SUCH CLAIMS DID ARISE, AND WE HAVE FOUND NO CASES INVOLVING THE PAYMENT OF SAME, IT MUST BE PRESUMED THAT IT WAS CONSIDERED ADMINISTRATIVELY THAT PAYMENT THEREOF WAS NOT CONTEMPLATED UNDER THE ACT. IN VIEW THEREOF, WE WOULD NOT BE INCLINED TO DISTURB AN ADMINISTRATIVE PRACTICE OF MORE THAN A HALF A CENTURY WHERE THERE ARE SURVIVING HEIRS.

IN THIS CONNECTION, HOWEVER, WE NOTE THAT YOUR REGULATIONS, 42 C.F.R. 303.8, PROVIDE FOR PAYMENT OF ANY AMOUNT INVOLVED TO THE ADMINISTRATOR WHERE ONE IS APPOINTED, AND ONLY TO THE ADMINISTRATOR OR EXECUTOR FOR AMOUNTS OF $100 OR MORE. IN THE DISTRICT OF COLUMBIA ANY INTERESTED PERSON MAY RECEIVE LETTERS OF ADMINISTRATION AND WHERE NO APPLICATIONS ARE RECEIVED FROM DESIGNATED RELATIVES, LETTERS OF ADMINISTRATION MAY BE GRANTED TO CREDITORS. 20 D.C. CODE 201 AND 216. ANY CREDITOR, THEREFORE, MAY HAVE HIS CLAIM CONSIDERED BY THE PROBATE COURT. THIS PROCEDURE APPEARS TO BE MORE APPROPRIATE THAN THE SETTLEMENT OF CLAIMS OF CREDITORS BY THE SUPERINTENDENT PROVIDED THAT THE COURT, THROUGH THE ADMINISTRATOR, IS MADE AWARE OF THE PROVISIONS OF 24 U.S.C. 177 SO THAT ANY AMOUNTS REMAINING UNCLAIMED MAY BE DEPOSITED IN THE TREASURY.

IN THE INSTANT CASE WE ARE IN AGREEMENT WITH THE SUPERINTENDENT'S PROPOSAL TO PAY THE PERSONAL FUNDS TO THE SON OF THE DECEASED UPON RECEIPT OF A CLAIM IN PROPER FORM AND IN CONFORMITY WITH YOUR REGULATIONS. HOWEVER, IT SHOULD BE NOTED THAT UNDER THE PROVISIONS OF 21 D.C. CODE 318, CERTAIN OF THE HEIRS, IN ADDITION TO THE ESTATE OF THE DECEASED, ARE LIABLE TO THE DISTRICT OF COLUMBIA FOR MAINTENANCE EXPENSES. TO AFFORD THE DISTRICT OF COLUMBIA ADEQUATE OPPORTUNITY TO EFFECTUATE COLLECTION UNDER SUCH STATUTORY PROVISION, IT WOULD APPEAR PROPER FOR THE SUPERINTENDENT, UNLESS OTHERWISE PROHIBITED BY LAW, TO INCLUDE THE NAME, ADDRESS AND RELATIONSHIP OF THE HEIR TO WHOM PAYMENT IS PROPOSED TO BE MADE, TOGETHER WITH THE AMOUNT OF SUCH PAYMENT, IN ANY DENIAL OF A CLAIM OF THE DISTRICT OF COLUMBIA BASED ON SUCH PAYMENT OR PROPOSED PAYMENT.

IN THE EVENT THE SON OF THE DECEASED FAILS TO FILE CLAIM IN PROPER FORM ON OR BEFORE THE END OF THE FIRST FULL FISCAL YEAR FOLLOWING THE DATE OF THE PATIENT'S DEATH, TRANSFER TO THE TREASURY IN ACCORDANCE WITH OUR DECISION OF MARCH 27, 1940 (B-3271), OF ALL PERSONAL FUNDS CREDITED TO THE DECEASED AND REMAINING UNCLAIMED, WILL BE PROPER. WE RECOMMEND, HOWEVER, THAT CLARIFYING LEGISLATION BE SOUGHT TO RESOLVE THE PRESENT UNCERTAINTY AS TO DISPOSITION OF SUCH FUNDS.