B-127020, APRIL 5, 1956, 35 COMP. GEN. 553

B-127020: Apr 5, 1956

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TRAVELING EXPENSES - HIRE OF AUTOMOBILE - INSURANCE PREMIUMS A NOMINAL CHARGE FOR INSURANCE WHICH WOULD RELEASE THE GOVERNMENT FROM DAMAGE LIABILITY INCIDENT TO THE HIRE OF AN AUTOMOBILE BY A FEDERAL EMPLOYEE IS A REIMBURSABLE ITEM OF EXPENSE. 1956: REFERENCE IS MADE TO YOUR LETTER OF JANUARY 12. THAT AMOUNT WAS DISALLOWED IN CONNECTION WITH MR. THE CHARGES FOR THE USE OF THE RENTED AUTOMOBILE ARE SET FORTH ON A FORM DESIGNATED AS THE HERTZ SYSTEM'S " STANDARD RENTAL AGREEMENT.'. WHERE THE $1 CHARGE WAS INSERTED THERE WAS STAMPED THE STATEMENT THAT " THE FIGURE $100.00 IN PAR. 6 (C) IS HEREBY CHANGED TO ZERO FOR CONSIDERATION OF $1.00 PER DAY.'. YOU INDICATE THAT SIMILAR ADDITIONAL CHARGES ARE FREQUENTLY SUBMITTED ON TRAVEL EXPENSE VOUCHERS BY DOL EMPLOYEES AND STATE THAT " SINCE THE UNITED STATES GOVERNMENT PAYS ITS OWN VALID CLAIMS.

B-127020, APRIL 5, 1956, 35 COMP. GEN. 553

TRAVELING EXPENSES - HIRE OF AUTOMOBILE - INSURANCE PREMIUMS A NOMINAL CHARGE FOR INSURANCE WHICH WOULD RELEASE THE GOVERNMENT FROM DAMAGE LIABILITY INCIDENT TO THE HIRE OF AN AUTOMOBILE BY A FEDERAL EMPLOYEE IS A REIMBURSABLE ITEM OF EXPENSE.

TO P. E. WAMPLER, DEPARTMENT OF THE ARMY, APRIL 5, 1956:

REFERENCE IS MADE TO YOUR LETTER OF JANUARY 12, 1956 ( ORDTL 102.23), FORWARDED HERE BY THE OFFICE OF THE CHIEF OF FINANCE ( FINEK 348.7), REQUESTING AN ADVANCE DECISION ON A VOUCHER FOR $1, STATED IN FAVOR OF WILLIAM M. PIPER, A CIVILIAN EMPLOYEE OF THE DIAMOND ORDNANCE FUSE LABORATORIES, DEPARTMENT OF THE ARMY. THAT AMOUNT WAS DISALLOWED IN CONNECTION WITH MR. PIPER'S CLAIM FOR REIMBURSEMENT OF THE SUM OF $16.64 PAID FOR THE RENTAL OF AN AUTOMOBILE USED IN OFFICIAL TRAVEL FROM NEWARK TO DOVER, NEW JERSEY.

THE CHARGES FOR THE USE OF THE RENTED AUTOMOBILE ARE SET FORTH ON A FORM DESIGNATED AS THE HERTZ SYSTEM'S " STANDARD RENTAL AGREEMENT.' PARAGRAPH 6 (C) OF THE PRINTED PROVISIONS OF THIS FORM PROVIDES THAT THE RENTER AGREES TO PAY TO THE OWNER ON DEMAND THE COST OF ALL DAMAGES TO THE VEHICLE, LIMITED TO THE SUM OF $100 UNLESS THE VEHICLE HAD BEEN OPERATED IN VIOLATION OF THE TERMS OF THE AGREEMENT. WHERE THE $1 CHARGE WAS INSERTED THERE WAS STAMPED THE STATEMENT THAT " THE FIGURE $100.00 IN PAR. 6 (C) IS HEREBY CHANGED TO ZERO FOR CONSIDERATION OF $1.00 PER DAY.' APPARENTLY, THE OWNER CARRIED $100 DEDUCTIBLE COLLISION INSURANCE ON THE AUTOMOBILE.

YOU INDICATE THAT SIMILAR ADDITIONAL CHARGES ARE FREQUENTLY SUBMITTED ON TRAVEL EXPENSE VOUCHERS BY DOL EMPLOYEES AND STATE THAT " SINCE THE UNITED STATES GOVERNMENT PAYS ITS OWN VALID CLAIMS, ANY INSURANCE OF THIS NATURE IS CONSIDERED SOLELY FOR THE PERSONAL PROTECTION OF THE TRAVELER AND NOT A LEGAL OFFICIAL TRAVEL EXPENSE.'

THE STANDARDIZED GOVERNMENT TRAVEL REGULATIONS CONTAIN NO REFERENCE TO INSURANCE ON RENTED CONVEYANCES BUT SUCH REGULATIONS APPEAR REASONABLY TO CONTEMPLATE THAT THE COST TO THE OWNER OF CARRYING INSURANCE ON AN AUTOMOBILE OR OTHER CONVEYANCE RENTED TO A GOVERNMENT EMPLOYEE WOULD BE INCLUDED IN THE RENTAL CHARGE ULTIMATELY TO BE BORNE BY THE UNITED STATES. SEE PARAGRAPH 11 OF THESE REGULATIONS. ALSO, THERE WOULD ORDINARILY APPEAR TO BE NO OBJECTION TO REIMBURSEMENT OF REASONABLE CHARGES MADE BY RENTAL AGENCIES FOR SELF-INSURANCE AGAINST POSSIBLE LOSSES NOT COVERED BY CONTRACTS OF INSURANCE ON THE RENTED EQUIPMENT. OF COURSE, THE GENERAL POLICY OF THE GOVERNMENT NOT TO CARRY INSURANCE UPON ITS OWN PROPERTY IS NOT APPLICABLE TO CASES INVOLVING PRIVATE PROPERTY TEMPORARILY ENTRUSTED TO THE CUSTODY OF THE GOVERNMENT OR OF ITS AGENTS FOR PUBLIC PURPOSES. SEE 17 COMP. GEN. 55, 56.

IN THE PRESENT CASE, IT IS APPARENT THAT MR. PIPER HAD THE OPTION EITHER OF PAYING THE RELATIVELY SMALL ADDITIONAL AMOUNT OF $1 FOR COMPLETE RELEASE FROM LIABILITY FOR DAMAGE TO THE AUTOMOBILE OR OF AGREEING TO PAY DAMAGES TO THE EXTENT OF $100, REGARDLESS OF THE CIRCUMSTANCES UNDER WHICH THE RENTED AUTOMOBILE MAY HAVE BECOME DAMAGED DURING THE RENTAL PERIOD. SINCE HE WAS TRAVELING ON OFFICIAL BUSINESS WITH APPARENT AUTHORITY TO HIRE AN AUTOMOBILE, HIS AGREEMENT TO PAY SUCH DAMAGES MIGHT WELL HAVE RESULTED IN A CLAIM AGAINST THE GOVERNMENT BY THE OWNER OF THE AUTOMOBILE. HENCE, IT CANNOT PROPERLY BE HELD THAT THE ADDITIONAL PAYMENT FOR RENTAL WAS SOLELY FOR THE PROTECTION OF THE TRAVELER.

WE ARE OF THE OPINION THAT THE EMPLOYEE EXERCISED REASONABLE DISCRETION IN THE MATTER AND YOU ARE AUTHORIZED TO MAKE PAYMENT ON THE RECLAIM VOUCHER WHICH IS RETURNED.