B-126902, DECEMBER 6, 1956, 36 COMP. GEN. 457

B-126902: Dec 6, 1956

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DISTRICT OF COLUMBIA - SET-OFF OF MONEY DUE EMPLOYEES TO LIQUIDATE DEBTS DUE DISTRICT OF COLUMBIA SINCE THE DISTRICT OF COLUMBIA GOVERNMENT IS A LEGAL ENTITY SEPARATE AND DISTINCT FROM THE UNITED STATES GOVERNMENT. THE PATIENT WAS A CIVIL SERVICE ANNUITANT AND. THAT REQUEST WAS HONORED BY YOUR COMMISSION. THE COURT'S OPINION IS TO THE EFFECT THAT THE RETIREMENT FUND CREDIT SHOULD BE PAID TO THE ADMINISTRATOR OF THE ESTATE WITHOUT PREJUDICE TO THE RIGHT OF THE DISTRICT OF COLUMBIA TO FILE CLAIM WITH THE ADMINISTRATOR FOR HOSPITAL CARE. IT IS TRUE THAT OUR OFFICE DECISION. OUR OFFICE RULED SUBSEQUENTLY THAT THE DISTRICT OF COLUMBIA GOVERNMENT IS A DISTINCT LEGAL ENTITY. WE ALSO HAVE TAKEN THE POSITION THAT.

B-126902, DECEMBER 6, 1956, 36 COMP. GEN. 457

DISTRICT OF COLUMBIA - SET-OFF OF MONEY DUE EMPLOYEES TO LIQUIDATE DEBTS DUE DISTRICT OF COLUMBIA SINCE THE DISTRICT OF COLUMBIA GOVERNMENT IS A LEGAL ENTITY SEPARATE AND DISTINCT FROM THE UNITED STATES GOVERNMENT, CLAIMS OF THE DISTRICT OF COLUMBIA FOR SET-OFF OF MONEY IN THE CIVIL SERVICE RETIREMENT FUND TO LIQUIDATE DEBTS DUE THE DISTRICT OF COLUMBIA BY FORMER EMPLOYEES MAY NOT BE HONORED BY THE FEDERAL GOVERNMENT. 10 COMP. GEN. 225, OVERRULED.

TO THE CHAIRMAN, UNITED STATES CIVIL SERVICE COMMISSION, DECEMBER 6, 1956:

YOUR LETTER OF NOVEMBER 20, 1956, REQUESTS OUR DECISION WHETHER FURTHER CLAIMS OF THE DISTRICT OF COLUMBIA FOR SETOFF OF MONEYS IN THE CIVIL SERVICE RETIREMENT FUND SHOULD BE HONORED IN VIEW OF THE OPINION OF THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA, FILED DECEMBER 15, 1955, IN THE CASE OF SEDGWICK V. YOUNG, CIVIL ACTION NO. 917-55.

WE UNDERSTAND THAT THE SEDGWICK CASE INVOLVED A PATIENT AT ST. ELIZABETHS HOSPITAL, NOW DECEASED, FOR WHOSE CARE THE DISTRICT OF COLUMBIA PAID ST. ELIZABETHS HOSPITAL. THE PATIENT WAS A CIVIL SERVICE ANNUITANT AND, AFTER HIS DEATH, THE DISTRICT OF COLUMBIA ASKED YOUR COMMISSION TO APPLY THE AMOUNT TO HIS CREDIT IN THE RETIREMENT FUND AGAINST HIS INDEBTEDNESS TO THE DISTRICT OF COLUMBIA. THAT REQUEST WAS HONORED BY YOUR COMMISSION. THE ADMINISTRATOR OF MR. SEDGWICK'S ESTATE FILED AN ACTION IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA TO REQUIRE PAYMENT OF THE RETIREMENT MONEY TO HIM. THE COURT'S OPINION IS TO THE EFFECT THAT THE RETIREMENT FUND CREDIT SHOULD BE PAID TO THE ADMINISTRATOR OF THE ESTATE WITHOUT PREJUDICE TO THE RIGHT OF THE DISTRICT OF COLUMBIA TO FILE CLAIM WITH THE ADMINISTRATOR FOR HOSPITAL CARE.

AS STATED IN YOUR LETTER, IT IS TRUE THAT OUR OFFICE DECISION, 10 COMP. GEN. 225, HELD THAT THE AMOUNT IN THE CIVIL SERVICE RETIREMENT FUND TO THE CREDIT OF A FORMER EMPLOYEE OF THE DISTRICT OF COLUMBIA MAY BE SET OFF IN LIQUIDATION OF A DEBT DUE THE DISTRICT OF COLUMBIA FROM THE FORMER EMPLOYEE. HOWEVER, OUR OFFICE RULED SUBSEQUENTLY THAT THE DISTRICT OF COLUMBIA GOVERNMENT IS A DISTINCT LEGAL ENTITY--- NOT AN AGENCY OF THE UNITED STATES GOVERNMENT--- AND, THEREFORE, NO LEGAL BASIS EXISTS FOR DEDUCTING THE AMOUNTS OF CLAIMS OF THE DISTRICT OF COLUMBIA FROM MONEYS DUE CONTRACTORS OF THE UNITED STATES. SEE OUR DECISION OF FEBRUARY 10, 1944, B-39254. WE ALSO HAVE TAKEN THE POSITION THAT, SINCE THE DISTRICT OF COLUMBIA GOVERNMENT IS A LEGAL ENTITY SEPARATE AND DISTINCT FROM THE UNITED STATES GOVERNMENT, THE ACCOUNTING OFFICERS OF THE UNITED STATES HAVE NO JURISDICTION TO SETTLE CLAIMS BY OR AGAINST THE GOVERNMENT OF THE DISTRICT OF COLUMBIA. SEE OUR DECISIONS OF FEBRUARY 7, 1952, B-106771, AND OF JULY 8, 1955, B 120734.

IN VIEW OF THE HOLDINGS IN OUR DECISIONS RENDERED SUBSEQUENT TO 10 COMP. GEN. 225, OUR DECISION IN 10 COMP. GEN. 225 NO LONGER SHOULD BE FOLLOWED. ACCORDINGLY, YOUR COMMISSION NO LONGER SHOULD HONOR CLAIMS BY THE DISTRICT OF COLUMBIA FOR SETOFF OF MONEYS IN THE RETIREMENT FUND IN LIQUIDATION OF DEBTS DUE THE DISTRICT OF COLUMBIA GOVERNMENT.