B-129239, NOV. 27, 1956

B-129239: Nov 27, 1956

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FARAHER: FURTHER REFERENCE IS MADE TO YOUR LETTER OF SEPTEMBER 17. WERE NOT COMPUTED AT RATES LISTED IN SALARY TABLE NO. 35. BIWEEKLY PAYMENTS TO THE CIVILIAN FIREFIGHTERS INVOLVED WERE COMPUTED ON TWO ERRONEOUS BASES. WHERE THE FROZEN RATE WAS APPLICABLE AND THE "TWO- THIRDS" RULE WAS APPLIED. SALARY TABLE NO. 36 WAS USED INSTEAD OF SALARY TABLE NO. 35. EMPLOYEES WHOSE RATES OF PAY WERE FROZEN UNDER THE SAVINGS PROVISION OF SECTION 401. WERE ERRONEOUSLY COMPENSATED AT THE CURRENT BASIC BIWEEKLY RATE. THEY NEVERTHELESS HAVE RECEIVED COMPENSATION IN EXCESS OF THE RATES ESTABLISHED BY THE CONGRESS. IT IS WELL ESTABLISHED THAT THE UNITED STATES CANNOT BE BOUND OR ESTOPPED BY ERRONEOUS PAYMENTS MADE THROUGH ADMINISTRATIVE ERROR OF ITS OFFICERS.

B-129239, NOV. 27, 1956

TO MRS. JAMES F. FARAHER:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF SEPTEMBER 17, 1956, PROTESTING THE ACTION OF THE DEPARTMENT OF THE NAVY IN ALLEGEDLY DEDUCTING ERRONEOUS PAYMENTS FROM THE PAY OF CIVILIAN FIREFIGHTERS EMPLOYED AT THE UNITED STATES NAVAL AIR STATION, LAKEHURST, NEW JERSEY.

IT APPEARS FROM A REPORT RECEIVED IN OUR OFFICE FROM THE NAVY DEPARTMENT THAT IN APPLYING SECTION 401, PUBLIC LAW 763, APPROVED SEPTEMBER 1, 1954, SALARY PAYMENTS FOR THE AFFECTED EMPLOYEES, INCLUDING YOUR HUSBAND, WERE NOT COMPUTED AT RATES LISTED IN SALARY TABLE NO. 35, ALTHOUGH THOSE RATES HAD BEEN FROZEN BY ADMINISTRATIVE REGULATION ON NOVEMBER 6, 1954.

BIWEEKLY PAYMENTS TO THE CIVILIAN FIREFIGHTERS INVOLVED WERE COMPUTED ON TWO ERRONEOUS BASES. WHERE THE FROZEN RATE WAS APPLICABLE AND THE "TWO- THIRDS" RULE WAS APPLIED, SALARY TABLE NO. 36 WAS USED INSTEAD OF SALARY TABLE NO. 35. IN OTHER INSTANCES, EMPLOYEES WHOSE RATES OF PAY WERE FROZEN UNDER THE SAVINGS PROVISION OF SECTION 401, PUBLIC LAW 763, WERE ERRONEOUSLY COMPENSATED AT THE CURRENT BASIC BIWEEKLY RATE, PLUS A PREMIUM OF 20 PERCENT, WHEN LEAVE WITH PAY DURING THE PAY PERIOD RESULTED IN DECREASING THE EMPLOYEE'S GROSS EARNINGS UNDER THE "TWO-THIRDS" RULE.

WHILE IT MAY BE TRUE THAT THE INDEBTEDNESS OF THE EMPLOYEES AROSE THROUGH NO FAULT ON THEIR PART, BUT RATHER THROUGH AN ERROR ON THE PART OF THE ADMINISTRATIVE OFFICE, THEY NEVERTHELESS HAVE RECEIVED COMPENSATION IN EXCESS OF THE RATES ESTABLISHED BY THE CONGRESS. AS TO THE GENERAL PROPOSITION OF ALLOWING INDIVIDUALS TO RETAIN MONEYS ERRONEOUSLY PAID TO THEM WITHOUT FAULT OR NEGLIGENCE ON THEIR PART, IT IS WELL ESTABLISHED THAT THE UNITED STATES CANNOT BE BOUND OR ESTOPPED BY ERRONEOUS PAYMENTS MADE THROUGH ADMINISTRATIVE ERROR OF ITS OFFICERS, WHETHER MADE UNDER MISTAKE OF FACT OR LAW, AND PARTIES RECEIVING SUCH PAYMENTS ACQUIRE NO RIGHT TO THEM. IT HAS BEEN HELD THAT EVEN FINANCIAL HARDSHIP WHICH MIGHT RESULT FROM COLLECTION FROM THE RECIPIENT OR THE FACT THAT PAYMENTS MAY HAVE BEEN RECEIVED IN GOOD FAITH DOES NOT MAKE AN EXCEPTION TO THE RULE.

ACCORDINGLY, OUR OFFICE IS WITHOUT AUTHORITY TO WAIVE RECOVERY OF THE OVERPAYMENTS.

WE TRUST THIS INFORMATION CAN HELP YOU TO UNDERSTAND THE SITUATION INVOLVING THESE ERRONEOUS PAYMENTS.