B-146679, OCT. 13, 1961

B-146679: Oct 13, 1961

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DELANY: REFERENCE IS MADE TO YOUR LETTER OF AUGUST 1. 497.50 WHICH ALLEGEDLY WAS APPLIED BY MISTAKE IN PART PAYMENT OF THE PURCHASE PRICE OF SURPLUS PROPERTY OFFERED FOR SALE BY THE ANTILLES COMMAND AT FORT BUCHANAN. WHICH WERE DESIGNATED AS THE TIME AND DATE OF BID OPENING. THE PLACE OF BID OPENING WAS DESIGNATED AS BUILDING NO. 596. THE INVITATION FURTHER PROVIDED THAT A BID DEPOSIT OF 20 PERCENT OF THE TOTAL AMOUNT BID WAS REQUIRED. CAUDIO WAS LISTED AS PROPERTY DISPOSAL OFFICER. THE BIDS WERE OPENED ON SEPTEMBER 8. ZAPETIS WAS THE HIGH BIDDER FOR THE CRANE-SHOVEL AND ATTACHMENT THERETO. ZAPETIS THAT A MANAGER'S CHECK PAYABLE TO HIM (GAUDIO) WAS AT THE BANK BRANCH. WAS GIVEN THE CHECK.

B-146679, OCT. 13, 1961

TO MR. FRANK J. DELANY:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 1, 1961, REQUESTING A REVIEW OF OUR SETTLEMENT DATED JULY 25, 1961, WHICH DISALLOWED THE CLAIM OF YOUR CLIENT, MR. M. H. STARR, FOR REFUND OF $2,497.50 WHICH ALLEGEDLY WAS APPLIED BY MISTAKE IN PART PAYMENT OF THE PURCHASE PRICE OF SURPLUS PROPERTY OFFERED FOR SALE BY THE ANTILLES COMMAND AT FORT BUCHANAN, PUERTO RICO.

ON AUGUST 18, 1960, THE PROPERTY DISPOSAL OFFICE, ANTILLES COMMAND, FORT BUCHANAN, PUERTO RICO, ISSUED INVITATION NO. 96-600-S-61-1, SPOT BID NO. 61-1, FOR THE SPOT BID SALE OF GOVERNMENT SURPLUS PROPERTY. THE INVITATION PROVIDED THAT BIDS WOULD BE RECEIVED UNTIL 10:00 A.M., SEPTEMBER 8, 1960, WHICH WERE DESIGNATED AS THE TIME AND DATE OF BID OPENING. THE PLACE OF BID OPENING WAS DESIGNATED AS BUILDING NO. 596, FORT BUCHANAN. THE INVITATION FURTHER PROVIDED THAT A BID DEPOSIT OF 20 PERCENT OF THE TOTAL AMOUNT BID WAS REQUIRED. JOSEPH J. CAUDIO WAS LISTED AS PROPERTY DISPOSAL OFFICER.

ITEMS 84 AND 84-A ON THIS INVITATION LISTED A CRANE-SHOVEL AND GANTRY ATTACHMENT THERETO AS BEING OFFERED FOR SALE IN ONE LOT.

THE BIDS WERE OPENED ON SEPTEMBER 8, 1960, PRESUMABLY AT 10:00 A.M. MR. ZAPETIS HAD MADE A BID TOTALING $11,151.51 ON ITEMS 84 AND 84-A. NO BID HAD BEEN RECEIVED FROM MR. STARR. MR. ZAPETIS WAS THE HIGH BIDDER FOR THE CRANE-SHOVEL AND ATTACHMENT THERETO. HE MADE A DEPOSIT OF A $1,000 CHECK AND INDICATED THAT HE WOULD WIRE HIS OFFICE IN FLORIDA FOR THE REMAINDER OF THE REQUIRED DEPOSIT.

ON SEPTEMBER 9, 1960, MR. GAUDIO RECEIVED A TELEPHONE CALL FROM THE SAN JUAN, PUERTO RICO, BRANCH OF THE CHASE MANHATTAN BANK TO THE EFFECT THAT THEY HAD A MANAGER'S CHECK PAYABLE TO HIM. LATER HE RECEIVED A PHONE CALL FROM MR. ZAPETIS INQUIRING AS TO WHETHER HIS (ZAPETIS-) CHECK HAD BEEN RECEIVED. MR. GAUDIO INFORMED MR. ZAPETIS THAT A MANAGER'S CHECK PAYABLE TO HIM (GAUDIO) WAS AT THE BANK BRANCH. MR. ZAPETIS SUBSEQUENTLY APPEARED AT THE BANK, REQUESTED, AND WAS GIVEN THE CHECK. LATER THE SAME DAY HE DELIVERED IT TO MR. GAUDIO WHO RETURNED THE $1,000 CHECK TO MR. ZAPETIS.

THE CHECK IN QUESTION WAS ISSUED BY THE MANAGER OF THE SAN JUAN, PUERTO RICO, BRANCH OF THE CHASE MANHATTAN BANK IN THE AMOUNT OF $2,497.50 ($2,500 LESS A $2.50 BANK CHARGE), AND WAS DATED SEPTEMBER 9, 1960. WAS MADE PAYABLE TO THE ORDER OF JOSEPH GAUDIO AND CONTAINED THE FOLLOWING NOTATION: "BY ORDER OF H. M. STARR COVERS (SIC) DEPOSIT ITEM NO. 84 ON SALE.'

ON SEPTEMBER 12, 1960, THE PROPERTY DISPOSAL OFFICE, FORT BUCHANAN, ISSUED A NOTICE OF AWARD TO MR. ZAPETIS, STATING THE TOTAL AMOUNT BID WAS $11,151.51 TO WHICH THE BID DEPOSIT OF $2,497.50 HAD BEEN APPLIED, LEAVING A BALANCE DUE OF $8,654.01.

MR. ZAPETIS ON OCTOBER 5, 1960, SOLD THE CRANE-SHOVEL AND GANTRY TO POWELL BROTHERS, INC., OF FORT LAUDERDALE, FLORIDA, FOR THE AMOUNT OF $12,500. POWELL BROTHERS, INC., SENT THE GOVERNMENT A CASHIER'S CHECK IN THE AMOUNT OF $8,654.01 FOR THE BALANCE DUE IT WHICH WAS RECEIVED ON OCTOBER 12, 1960, AND ON OCTOBER 18, 1960, POWELL BROTHERS, INC., TOOK DELIVERY OF THE EQUIPMENT.

ON NOVEMBER 21, 1960, MR. HERMAN M. BERK, ATTORNEY AT LAW, ACTING IN BEHALF OF MR. STARR MADE CLAIM TO THE FINANCE OFFICER, ANTILLES COMMAND, FORT BUCHANAN, FOR THE PROCEEDS OF THE $2,497.50 CHECK. THE FINANCE OFFICER ANSWERED ON DECEMBER 7, 1960, SAYING THAT HE WAS UNABLE TO GRANT THE REQUESTED REFUND.

YOU REASSERTED MR. STARF'S CLAIM IN LETTER TO US DATED JANUARY 30, 1961, CONTENDING THAT THE AMOUNT OF HIS DEPOSIT WAS ERRONEOUSLY APPLIED IN PART PAYMENT OF THE PURCHASE PRICE BY ANOTHER BIDDER. YOU RELATED THAT MR. STARR WAS CONTACTED IN MIAMI BY MR. ZAPETIS AND THAT THEY HAD AN ARRANGEMENT BETWEEN THEM REGARDING THE PURCHASE OF SURPLUS EQUIPMENT, ALLEGING THAT SUCH ARRANGEMENT WAS THAT ANY EQUIPMENT PURCHASED WOULD BE BOUGHT IN THE NAME OF MR. STARR WITH A FEE TO MR. ZAPETIS FOR HANDLING DETAILS. YOU STATE THAT IN CONTEMPLATION OF MAKING A BID ON ITEM NO. 84 MR. STARR ON SEPTEMBER 8, 1960, CAUSED $2,500 TO BE TRANSMITTED BY THE FIRST NATIONAL BANK OF MIAMI TO THE PUERTO RICO BRANCH OF THE CHASE MANHATTAN BANK FOR THE CREDIT OF JOSEPH GAUDIO, DISPOSAL OFFICER.

YOU CONTEND THAT MR. STARR CONTEMPLATED MAKING A BID IN HIS OWN NAME AND THE FUNDS WERE TRANSMITTED SOLELY AS A DEPOSIT IN ANTICIPATION OF SUCH A BID; THAT HE DID NOT KNOW THAT THE BID OPENING WAS SET FOR SEPTEMBER 8 AT 10:00 A.M., MAKING A LATER BID UNACCEPTABLE; THAT HE DID NOT KNOW THAT MR. ZAPETIS HAD MADE A BID WHICH WAS ACCEPTED; AND THAT THE FACT THAT THE DEPOSIT OF MR. STARR WAS APPLIED TO THE BID OF MR. ZAPETIS IS NO REASON WHY THE SUM SHOULD BE WITHHELD.

BY SETTLEMENT DATED JULY 25, 1961, MR. STARR'S CLAIM WAS DISALLOWED ON THE BASIS THAT IT HAD ARISEN THROUGH SOME MISUNDERSTANDING OR DISAGREEMENT BETWEEN HIM AND MR. ZAPETIS AND THUS CONSISTED OF A PERSONAL MATTER BETWEEN THEM AND NOT ONE IN WHICH THE GOVERNMENT SHOULD BECOME FURTHER INVOLVED.

IN REQUESTING RECONSIDERATION OF THE MATTER YOU CONTEND THAT MR. STARR'S OWNERSHIP OF THE CHECK WAS INDICATED ON ITS FACE. HOWEVER, IN SO ARGUING YOU LOSE SIGHT OF THE FACT THAT MR. GAUDIO AS PAYEE IN POSSESSION OF THE CHECK WAS THE LEGAL HOLDER THEREOF, 5 U.L.A. S 191; WILBUR V. HAWKINS, 94 A. 856; FEDERAL LAND BANK OF NEW ORLEANS V. MILLER, 25 SO.2D 11, AND POSSESSION BY THE PAYEE OF A NEGOTIABLE INSTRUMENT IS PRIMA FACIE EVIDENCE OF HIS OWNERSHIP. WALDOCK V. WINKLER, 152 P. 99.

THE WORDS "BY ORDER" OF H. M. STARR APPEARING ON THE FACE OF THE MANAGER'S CHECK HAD NO OTHER SIGNIFICANCE THAN TO INDICATE THAT THE CHECK WAS DRAWN BY THE BANK PURSUANT TO THE REQUEST OF MR. STARR. AN "ORDER" IS A WRITTEN STATEMENT CONTAINING A REQUEST OR DIRECTION TO A THIRD PERSON, WHO IS INDEBTED TO THE MAKER OF THE ORDER TO PAY A SPECIFIED SUM OF MONEY TO THE PERSON NAMED. CARR V. SUMMERFIELD, 34 S.E. 804; PEOPLE V. SMITH, 70 N.W. 466. BALLENTINE'S LAW DICTIONARY, SECOND EDITION.

SINCE IT IS ADMITTED THAT MR. STARR HAD AN ARRANGEMENT WITH MR. ZAPETIS REGARDING THE PURCHASE OF THE EQUIPMENT IN QUESTION, WE ARE REQUIRED TO REAFFIRM THE CONCLUSION REACHED BY OUR CLAIMS DIVISION THAT THE CLAIM AROSE THROUGH SOME MISUNDERSTANDING OR DISAGREEMENT BETWEEN HIM AND MR. ZAPETIS AND THUS CONSISTS OF A PERSONAL MATTER BETWEEN THEM AND NOT ONE IN WHICH THE GOVERNMENT SHOULD BECOME INVOLVED. IN ANY EVENT THE CLAIM CONTAINS SUCH ELEMENTS OF DOUBTFUL VALIDITY BOTH AS TO FACT AND LAW THAT WE ARE REQUIRED TO REJECT IT LEAVING MR. STARR TO SEEK HIS REMEDY IN THE COURTS. CHARLES V. UNITED STATES, 19 CT.CL. 316; LONGWILL V. UNITED STATES, 17 CT.CL. 228.

ACCORDINGLY, THE DISALLOWANCE IS SUSTAINED. UNDER THE CIRCUMSTANCES IN THIS CASE AND CONSIDERING THE FACT THAT WE SETTLE CLAIMS SOLELY ON THE BASIS OF THE WRITTEN RECORD, IT DOES NOT APPEAR THAT AN INFORMAL HEARING ON THE MATTER COULD SERVE ANY USEFUL PURPOSE. IF YOU STILL DESIRE TO DISCUSS THE CLAIM WITH REPRESENTATIVES OF THE GENERAL ACCOUNTING OFFICE, ARRANGEMENTS FOR A MEETING MAY BE MADE BY CONTACTING MR. RALPH E. RAMSEY, ASSOCIATE GENERAL COUNSEL, ON DUDLEY 6 5166.