B-132565, AUG. 5, 1957

B-132565, AUG. 5, 1957

TO S.F.C. STEVE P. MAXWELL, RA 69 037 79:

YOUR LETTER DATED JUNE 13, 1957, REQUESTS OUR REVIEW OF THE DISALLOWANCE OF YOUR CLAIM FOR PROCEEDS OF TREASURY (NSLI DIVIDEND) CHECK NO. 19,921,293, DATED MARCH 16, 1950, FOR $126.50, DRAWN BY PAUL D. BENNING, SYMBOL 321, TO THE ORDER OF STEVE P. MAXWELL.

YOU SAY THAT YOUR FIRST KNOWLEDGE OF THE EXISTENCE OF THE ABOVE-CITED CHECK WAS JULY 5, 1951, AND YOU BELIEVE THAT YOUR WIFE CASHED THE CHECK UPON ITS DELIVERY TO YOUR THEN HOME ADDRESS IN BROOKLYN, NEW YORK, AT WHICH TIME YOU WERE STATIONED IN JAPAN.

THE RECORD SHOWS THAT THE CHECK WAS ENDORSED IN YOUR NAME AND WAS NEGOTIATED AND PAID BY THE TREASURER OF THE UNITED STATES ON MARCH 22, 1950. SUBSEQUENTLY, AFTER RECEIPT, THROUGH THE TREASURER, OF A COMMUNICATION EXECUTED BY YOU ALLEGING THAT YOU HAD NOT RECEIVED THE CHECK, OUR OFFICE, ON AUGUST 24, 1951, MAILED YOU A PHOTOSTATIC COPY OF THE CHECK AND A CLAIM FORM NO. 6576, WITH INSTRUCTIONS THAT THE LATTER SHOULD BE FILLED IN AND EXECUTED BY YOU AND RETURNED TO OUR OFFICE IF AFTER EXAMINATION OF THE PHOTOSTAT OF THE CHECK YOU WERE OF THE OPINION THAT YOU DID NOT RECEIVE AND ENDORSE THE CHECK. IT APPEARS THAT YOU MADE NO REPLY THERETO, BUT THAT ON APRIL 17, 1957--- OVER SEVEN YEARS AFTER THE CHECK WAS PAID--- YOU EXECUTED THE CLAIM FORM AND RETURNED IT TO OUR OFFICE. HOWEVER, YOUR CLAIM WAS DISALLOWED BY SETTLEMENT DATED JUNE 6, 1957, BECAUSE, EVEN IF IT SHOULD BE ESTABLISHED THAT YOU DID NOT PARTICIPATE IN THE PROCEEDS OF THE CHECK, THE GOVERNMENT HAS BY REASON OF YOUR DELAY LOST ITS RIGHT OF RECOURSE AGAINST THE ENDORSERS OF THE CHECK.

THE ACT OF MARCH 6, 1946, 60 STAT. 31, 31 U.S.C. 129, SO FAR AS HERE MATERIAL, IMPOSES A TIME LIMITATION OF SIX YEARS AFTER THE PRESENTATION OF A GOVERNMENT CHECK FOR PAYMENT WITHIN WHICH NOTICE SHALL BE GIVEN TO AN ENDORSER OF A GOVERNMENT CHECK TO ENFORCE HIS LIABILITY AS AN ENDORSER, WITH THE FURTHER PROVISION THAT IN CONNECTION WITH A CLAIM PRESENTED TO OUR OFFICE WITHIN SIX YEARS AFTER THE DATE OF ISSUANCE OF THE CHECK THE PERIOD FOR GIVING SUCH NOTICE SHALL BE EXTENDED BY AN ADDITIONAL ONE HUNDRED EIGHTY DAYS. IT WAS NOT UNTIL AFTER THE EXPIRATION OF THAT PERIOD THAT YOU EXECUTED AND FILED THE CLAIM FORM.

YOUR FAILURE TO PRESS YOUR CLAIM ON THE CHECK AFTER THE PHOTOSTAT THEREOF AND THE CLAIM FORM HAD BEEN SENT YOU ON AUGUST 24, 1951, WITH THE INSTRUCTIONS HEREINABOVE STATED CLEARLY JUSTIFIES THE VIEW THAT YOU, AFTER EXAMINING THE CHECK, HAD ACQUIESCED TO THE ENDORSEMENT AND CONCLUDED THAT THE PROCEEDS WERE EXPENDED FOR FAMILY SUPPORT AND MAINTENANCE AND THAT YOU HAD, THEREFORE, ABANDONED THE CLAIM. WHEN, HOWEVER, YOU DID EVENTUALLY FILE THE CLAIM FORM, IT WAS NOT UNTIL AFTER THE RIGHT OF THE GOVERNMENT TO PROTECT ITSELF BY PROCEEDING AGAINST THE ENDORSERS HAD BEEN LOST BY LAPSE OF TIME. HENCE, EVEN IF IT SHOULD BE ESTABLISHED THAT YOU DID NOT RECEIVE OR PARTICIPATE IN THE PROCEEDS OF THE CHECK OR THAT THE AMOUNT THEREOF WAS NOT EXPENDED FOR YOUR LEGAL OBLIGATIONS, YOUR DELAY HAS PREJUDICED THE RIGHT OF THE GOVERNMENT TO PROCEED AGAINST THE ENDORSERS OF THE CHECK. ANY LOSS RESULTING FROM SUCH DELAY ON YOUR PART MUST BE BORNE BY YOU RATHER THAN THE GOVERNMENT, THERE BEING FOR APPLICATION, IN THE CIRCUMSTANCES, THE EQUITABLE DOCTRINE THAT WHERE EITHER OF TWO INNOCENT PARTIES MUST SUFFER, HE WHO WAS NEGLIGENT OR AT FAULT, MUST BEAR THE RESULTING LOSS.

THEREFORE, THE DISALLOWANCE OF YOUR CLAIM WAS CORRECT AND IS SUSTAINED.