B-130974, JUN. 4, 1957

B-130974: Jun 4, 1957

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BLY: FURTHER REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 12. EXECUTRIX AND SOLE BENEFICIARY UNDER THE WILL OF THE LATE DR. THE ALLOTMENT WAS PAID TO DR. DANA FOR THE MONTHS OF JULY 1943 THROUGH MARCH 1946 WHEN IT WAS DISCONTINUED. DANA WAS DISCHARGED ON OCTOBER 31. THE ALLOTMENT SHOULD HAVE BEEN DISCONTINUED WITH THE MONTH OF OCTOBER 1943. SHOWS THAT NO DEDUCTIONS WERE MADE FOR THE CLASS E ALLOTMENT PAID TO DR. FLIGHT OFFICER DANA WAS RELEASED FROM ACTIVE DUTY EFFECTIVE JANUARY 13. DANA FOR THE MONTHS OF NOVEMBER 1943 THROUGH MARCH 1946 AND SINCE NO DEDUCTIONS WERE MADE IN MR. DANA WAS THE RECIPIENT OF THE OVERPAYMENT AND. DANA AS EXECUTRIX OF THE WILL OF HER LATE HUSBAND. DANA AS THE SOLE BENEFICIARY AND DEVISEE UNDER THE WILL.

B-130974, JUN. 4, 1957

TO MR. JAMES C. BLY:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 12, 1957, CONCERNING THE CLAIM OF THE UNITED STATES AGAINST MRS. MARY G. DANA, EXECUTRIX AND SOLE BENEFICIARY UNDER THE WILL OF THE LATE DR. LAWRENCE W. DANA, BY REASON OF AN OVERPAYMENT OF CLASS E ALLOTMENT MADE TO DR. DANA IN THE AMOUNT OF $580 INCIDENT TO THE SERVICE OF HIS SON, PAUL C. DANA, WHILE SERVING IN THE ARMY.

THE OFFICIAL RECORDS SHOW THAT, WHILE SERVING AS A PRIVATE, PAUL C. DANA AUTHORIZED A CLASS E ALLOTMENT IN FAVOR OF DR. L. W. DANA AS ALLOTTEE OR MRS. MARY C. DANA AS ALTERNATE ALLOTTEE, IN THE AMOUNT OF $20 PER MONTH FOR AN INDEFINITE PERIOD, EFFECTIVE JULY 1, 1943. THE ALLOTMENT WAS PAID TO DR. L. W. DANA FOR THE MONTHS OF JULY 1943 THROUGH MARCH 1946 WHEN IT WAS DISCONTINUED. PAUL C. DANA WAS DISCHARGED ON OCTOBER 31, 1943, AS AN ENLISTED MAN TO ACCEPT A COMMISSION AS FLIGHT OFFICER. UNDER THE PROVISIONS OF PARAGRAPH 11, ARMY REGULATIONS 35-5520 DATED MARCH 4, 1941, IN EFFECT DURING THE PERIOD HERE INVOLVED, THE ALLOTMENT SHOULD HAVE BEEN DISCONTINUED WITH THE MONTH OF OCTOBER 1943. AN EXAMINATION OF FLIGHT OFFICER DANA'S PAY ACCOUNTS, HOWEVER, SHOWS THAT NO DEDUCTIONS WERE MADE FOR THE CLASS E ALLOTMENT PAID TO DR. DANA FOR THE MONTHS OF NOVEMBER 1943 THROUGH JANUARY 1946. FLIGHT OFFICER DANA WAS RELEASED FROM ACTIVE DUTY EFFECTIVE JANUARY 13, 1946. SINCE PAYMENTS CONTINUED TO BE MADE TO DR. DANA FOR THE MONTHS OF NOVEMBER 1943 THROUGH MARCH 1946 AND SINCE NO DEDUCTIONS WERE MADE IN MR. DANA'S PAY ACCOUNT TO COVER THOSE PAYMENTS, AN OVERPAYMENT AROSE IN THE AMOUNT OF $580 (29 MONTHS AT $20 PER MONTH). DR. DANA WAS THE RECIPIENT OF THE OVERPAYMENT AND, THEREFORE, LEGALLY LIABLE TO REFUND SUCH AMOUNT. SEE 33 COMP. GEN. 309.

IT APPEARS FROM THE RECORD BEFORE US THAT DR. DANA DIED SHORTLY PRIOR TO MAY 4, 1953, THE DATE THE CLERK OF THE ORPHANS' COURT, MCKEAN COUNTY, STATE OF PENNSYLVANIA, ISSUED LETTERS TESTAMENTARY TO MARY G. DANA AS EXECUTRIX OF THE WILL OF HER LATE HUSBAND, DR. DANA. THE RECORD AS FURNISHED US BY THE CLERK OF THE ORPHANS' COURT SHOWS THAT ON SEPTEMBER 3, 1954, MRS. DANA FILED A FIRST, FINAL AND DISTRIBUTIVE ACCOUNT AS EXECUTRIX SHOWING MARY G. DANA AS THE SOLE BENEFICIARY AND DEVISEE UNDER THE WILL. EFFORTS WERE MADE TO COLLECT THE OVERPAYMENT FROM MRS. MARY G. DANA AS EXECUTRIX OF THE WILL, AND SEVERAL OF OUR LETTERS REQUESTING REPAYMENT WERE ADDRESSED TO HER IN CARE OF YOUR OFFICE. IN SUPPORT OF THE RIGHT OF THE UNITED STATES TO ENFORCE CLAIMS AGAINST ADMINISTRATORS AND EXECUTORS OF AN ESTATE, THERE WERE CITED THE CASES OF UNITED STATES V. SUMMERLIN, 310 U.S. 414, AND UNITED STATES V. ANDERSON, 66 F.SUPP. 870.

IN YOUR LETTER OF FEBRUARY 12, 1957, YOU STATE THAT:

"MRS. MARY GENEVIEVE DANA DIED SHORTLY AFTER MY LETTER OF SEPTEMBER 25, 1956 TO YOU. I AM REPRESENTING THE EXECUTORS OF HER LAST WILL AND TESTAMENT IN SETTLEMENT OF HER ESTATE. YOUR LETTER OF JANUARY 3, 1957 HAS BEEN DISCUSSED WITH THE EXECUTORS AND I HAVE ALSO DONE SOME FURTHER RESEARCH ON THIS QUESTION.'

YOU EXPRESS THE OPINION THAT THE ERRONEOUS PAYMENTS WERE NOT DUE TO ANY ACTION BY DR. L. W. DANA OR PAUL C. DANA, BUT RATHER IT IS YOUR BELIEF THAT UNDER THE PROVISIONS OF SECTION 16 OF THE ACT OF MARCH 2, 1899, 30 STAT. 981, AS AMENDED, 10 U.S.C. 894, THE PERSON WHO MADE THE MISTAKE WHICH RESULTED IN THE ERRONEOUS PAYMENTS IS LIABLE.

SECTION 16 OF THE ACT OF MARCH 2, 1899, 10 U.S.C. 894 (1952 ED.) AUTHORIZES THE SECRETARY OF THE ARMY, UNDER SUCH REGULATIONS AS HE MAY PRESCRIBE, TO PERMIT ARMY PERSONNEL TO MAKE ALLOTMENTS FROM THEIR PAY. THE SECTION FURTHER PROVIDES THAT IF ERRONEOUS PAYMENT IS MADE BECAUSE OF FAILURE OF AN OFFICER TO REPORT, IN THE MANNER PRESCRIBED BY THE SECRETARY OF THE ARMY, THE DEATH OF THE GRANTOR, OR ANY FACT WHICH RENDERS THE ALLOTMENT NOT PAYABLE, THEN THE AMOUNT OF SUCH ERRONEOUS PAYMENT SHALL BE COLLECTED BY WHATEVER BRANCH, OFFICE, OR OFFICERS OF THE ARMY THE SECRETARY OF THE ARMY MAY FROM TIME TO TIME DESIGNATE FROM THE OFFICER WHO FAILS TO MAKE SUCH REPORT, IF SUCH COLLECTION IS PRACTICABLE. UNDER THE STATUTORY AUTHORITY VESTED IN THE SECRETARY OF THE ARMY, THERE WERE ISSUED APPROPRIATE ARMY REGULATIONS TO IMPLEMENT THE PROVISIONS OF THE ACT.

AS STATED ABOVE, DURING THE PERIOD HERE INVOLVED THERE WAS IN EFFECT PARAGRAPH 11, ARMY REGULATIONS 35-5520 DATED MARCH 4, 1941, WHICH PROVIDED THAT ALLOTMENTS WOULD BE DISCONTINUED WHENEVER THE STATUS OF AN ALLOTTER CHANGES FROM THAT OF AN ENLISTED MAN TO THAT OF AN OFFICER. THE SECRETARY OF THE ARMY MADE NO DETERMINATION THAT THE ERRONEOUS PAYMENTS TO DR. DANA AROSE BY REASON OF THE FAILURE OF AN OFFICER TO TAKE APPROPRIATE ACTION TO DISCONTINUE SUCH PAYMENTS. ON THE CONTRARY, THE DEPARTMENT OF THE ARMY REFERRED THE INDEBTEDNESS TO OUR OFFICE FOR COLLECTION WITH THE STATEMENT THAT "SINCE EVERY REASONABLE EFFORT HAS BEEN MADE TO COLLECT THE ERRONEOUS PAYMENT, THIS ACCOUNT IS ADMINISTRATIVELY DETERMINED TO BE UNCOLLECTIBLE. HOWEVER, THE AMOUNT REMAINS DUE THE UNITED STATES UNTIL LIQUIDATED.'

IN DISCUSSING THE CASE OF UNITED STATES V. SUMMERLIN, 310 U.S. 414, YOU SAY "IN THAT CASE, THE CLAIM WAS ACTUALLY MADE DURING THE ADMINISTRATION OF THE ESTATE, WHILE, IN THE DANA CASE, NO CLAIM WAS WAS MADE UNTIL LONG AFTER SETTLEMENT OF THE ESTATE.' IT WILL BE NOTED THAT IN THE SUMMERLIN CASE THE RESPONDENT ON AUGUST 13, 1937, GAVE NOTICE BY PUBLICATION TO THE CREDITORS OF THE ESTATE TO FILE PROOF OF THEIR CLAIMS WITHIN EIGHT MONTHS AS REQUIRED BY THE STATE STATUTE. THE UNITED STATES, HOWEVER, FILED ITS CLAIM IN THE OFFICE OF THE COUNTY JUDGE ON JULY 1, 1938, WHICH CLAIM WAS NOT FILED WITHIN THE STATUTORY PERIOD. IN UNITED STATES V. ANDERSON, 66 F.SUPP. 870, THE COURT SAID THAT THE FAILURE OF THE UNITED STATES TO FILE CLAIM AGAINST ESTATES OF DECEASED MAKERS OF A NOTE WITHIN THE TIME REQUIRED BY THE MINNESOTA STATUTES WOULD NOT DEFEAT THE RIGHT OF THE UNITED STATES TO ENFORCE A CLAIM AGAINST ADMINISTRATORS OF ESTATES OF DECEASED MAKERS. STATUTES LIMITING THE TIME FOR CREDITORS TO FILE CLAIMS AGAINST DECEDENTS' ESTATES IN PROBATE COURTS HAVE NO APPLICATION TO THE UNITED STATES. UNITED STATES V. SUMMERLIN, 310 U.S. 414; UNITED STATES V. GIBSON, 101 F.SUPP. 225; UNITED STATES V. LUCE, 78 F.SUPP. 241; UNITED STATES V. SWANSON, 75 F.SUPP. 118, AND UNITED STATES V. ANDERSON, 66 F.SUPP. 870.

IT FOLLOWS THAT ON THE BASIS OF THOSE DECISIONS, LACK OF NOTICE OF THE GOVERNMENT'S CLAIM AGAINST THE ESTATE OF DR. DANA PRIOR TO THE PROBATE COURT'S FINAL DECREE OF DISTRIBUTION AND THE DISCHARGE OF MRS. MARY G. DANA AS EXECUTRIX, DOES NOT PRECLUDE THE UNITED STATES FROM PURSUING ITS RIGHTS AGAINST THE HEIR OR DEVISEE UNDER THE WILL. THERE IS ENCLOSED FOR YOUR INFORMATION A PHOTOSTATIC COPY OF LETTER DATED MARCH 6, 1952, FROM DR. LAWRENCE W. DANA SHOWING THAT HE HAD KNOWLEDGE OF THE INDEBTEDNESS PRIOR TO HIS DEATH. PERSONS RECEIVING SUCH ERRONEOUS PAYMENTS ACQUIRE NO RIGHT TO THEM AND THE COURTS CONSISTENTLY HAVE HELD THAT THEY ARE BOUND IN EQUITY AND GOOD CONSCIENCE TO MAKE RESTITUTION. SEE BARNES ET AL. V. DISTRICT OF COLUMBIA, 22 C.CLS. 366; UNITED STATES V. BURCHARD, 125 U.S. 176; WISCONSIN CENTRAL RAILROAD V. UNITED STATES, 164 U.S. 190, AND THE CASES COLLECTED AND DISCUSSED IN UNITED STATES V. SUTTON CHEMICAL COMPANY, 11 F.2D 24, AND IN 63 A.L.R. 1346.

THE ESTATE OF MRS. MARY G. DANA IS LIABLE FOR THE ERRONEOUS PAYMENTS RECEIVED AND REFUND SHOULD BE MADE WITHOUT FURTHER DELAY. SINCE, AS YOU STATE, YOU REPRESENT THE EXECUTORS OF THE WILL OF MRS. MARY G. DANA, THEY SHOULD BE ADVISED THAT UNLESS REFUND OF THE AMOUNT IS MADE WITHIN A REASONABLE TIME WE WILL BE REQUIRED TO REFER THE MATTER TO THE DEPARTMENT OF JUSTICE FOR SUCH FURTHER LEGAL ACTION AS THAT OFFICE MAY DEEM APPROPRIATE.