B-154380, JUN. 24, 1964

B-154380, JUN. 24, 1964

TO MR. REED H. JENSEN, CERTIFYING OFFICER, FOREST SERVICE, PACIFIC NORTHWEST REGION:

REFERENCE IS MADE TO YOUR LETTER OF MAY 20, 1964, FILE 6540, REQUESTING A DECISION AS TO WHETHER YOU MAY PROPERLY APPLY THE PROCEEDS OF AN ENCLOSED PUBLIC VOUCHER FOR REFUNDS TOWARD A CLAIM THE UNITED STATES HOLDS AGAINST THE CLAIMANT OF THE REFUND, MR. BOB MATRIOTTI.

YOU STATE THAT THE REFUND CLAIMED REPRESENTS UNAPPLIED ADVANCE DEPOSITS MADE BY MR. MATRIOTTI TOWARD PURCHASE OF TIMBER UNDER SALES CONTRACT WITH THE U.S. FOREST SERVICE. THE REMOVAL OF THE TIMBER UNDER CONTRACT IS NOW COMPLETE AND THE REMAINING BALANCES OF THE ADVANCE DEPOSITS ARE NOW ELIGIBLE FOR REFUND TO MR. MATRIOTTI. THE UNITED STATES CLAIM AGAINST MR. MATRIOTTI AROSE OUT OF THE SAME TIMBER SALE CONTRACT UNDER WHICH THOSE ADVANCE TIMBER SALE DEPOSITS, NOW SUBJECT TO REFUND, WERE MADE. MR. MATRIOTTI DISREGARDED CONTRACT PROVISIONS BY USING EXPLOSIVES TO REMOVE A TOP FROM A TREE USED IN HIS LOGGING OPERATIONS. THE EXPLOSION RESULTED IN THE SCATTERING OF FIRE OVER THE LOGGING AREA. THE LOGGING CREW WAS UNABLE TO CONTROL THE FIRE. FOREST SERVICE FIRE SUPPRESSION CREWS WERE CALLED IN TO PUT OUT THE FIRE. YOU FURTHER STATE THAT UNDER PROVISIONS OF THE CONTRACT MR. MATRIOTTI IS LIABLE FOR DAMAGE AND FIRE SUPPRESSION COSTS RESULTING UNDER THESE CIRCUMSTANCES. THE UNITED STATES CLAIM AGAINST MR. MATRIOTTI IN THIS CASE TOTALED $2,577.21. NEGOTIATIONS FOR SETTLEMENT HAVE BEEN CARRIED ON BY THE U.S. FOREST SERVICE FOR OVER TWO YEARS WITH MR. MATRIOTTI AND WITH HIS BONDSMEN, HOWEVER, ONLY $500 OF THIS TOTAL HAS BEEN RECEIVED TO DATE. IN VIEW OF THE FOREGOING YOU ASK WHETHER YOU MAY APPLY THE PROCEEDS OF MR. MATRIOTTI'S REFUND CLAIM TOWARD THE CLAIM AGAINST HIM.

UNDER THE TERMS OF THE TIMBER SALE CONTRACT BETWEEN THE FOREST SERVICE AND BOB MATRIOTTI THE FOREST SERVICE AGREED TO PERMIT THE PURCHASER (MATRIOTTI) TO CUT AND THE PURCHASER AGREED TO CUT THE TIMBER COVERED BY THE CONTRACT, AND THE FOREST SERVICE AGREES TO SELL AND THE PURCHASER AGREES TO PURCHASE AND REMOVE SUCH CUT TIMBER, SUBJECT TO PROVISIONS OF THE CONTRACT. IN THIS RESPECT, SECTION 9 OF THE CONTRACT, DEALING WITH FIRE SUPPRESSION AND FIRE PRECAUTIONS PROVIDES IN PERTINENT PART AS FOLLOWS:

"SECTION 9C. FIRE SUPPRESSION COSTS.

1. FOR ALL FIRES ORIGINATING ON THE SALE AREA OF VICINITY CAUSED BY THE ACTIVITIES OF, OR USE OF AN INSTRUMENTALITY BY, THE PURCHASER, HIS EMPLOYEES, SUBCONTRACTORS OR THEIR EMPLOYEES (UNLESS SUCH EMPLOYEES WERE ACTING UNDER THE IMMEDIATE SUPERVISION OF THE FOREST SERVICE, AS IN SLASH DISPOSAL) INCLUDING BUT NOT LIMITED TO, FIRES RESULTING FROM SMOKING BY PERSONS ENGAGED IN BEHALF OF THE PURCHASER IN OPERATIONS IN CONNECTION WITH THIS SALE DURING THE COURSE OF THEIR EMPLOYMENT, REST, OR LUNCH PERIODS, OR WHEN GOING TO AND FROM WORK IN VEHICLES OF THE PURCHASER, (HEREINAFTER REFERRED TO AS "PURCHASER FIRES") THE FOREST SERVICE, EXCEPT AS PROVIDED IN SECTION 9B-2, WILL PERFORM FIRE SUPPRESSION ACTIVITIES AND WITHIN THE COST LIMITATIONS SET FORTH IN THIS PARAGRAPH SHALL BE DEEMED TO BE PERFORMING SUCH SUPPRESSION ACTIVITIES UNDER SECTION 5, ACT OF APRIL 24, 1950, 64 STAT. 83, 16 U.S.C. 572, AT THE REQUEST, AND FOR THE BENEFIT, OF THE PURCHASER. THE PURCHASER AGREES TO REIMBURSE THE FOREST SERVICE FOR THE COST THEREOF, EXCEPT THAT FOR ANY NON-NEGLIGENT PURCHASER FIRE SUCH REIMBURSEMENT SHALL BE SUBJECT TO A MAXIMUM OF ONE THOUSAND FIVE HUNDRED AND NO/100 - - - - - - - DOLLARS ($1,500.00): PROVIDED, THAT THE COST TO THE PURCHASER OF SERVICES ON ANY SUCH FIRE PURSUANT TO SECTION 9B- 2, OR OTHERWISE AT THE REQUEST OF THE FOREST SERVICE, SHALL BE CREDITED TOWARD SUCH MAXIMUM, AND: PROVIDED FURTHER, THAT IF SUCH COSTS TO THE PURCHASER EXCEED SUCH MAXIMUM THE FOREST SERVICE WILL REIMBURSE THE PURCHASER SUCH EXCESS. THE AMOUNT OF COST TO THE PURCHASER SHALL BE THE THE AMOUNT ACTUALLY EXPENDED BY THE PURCHASER OR THE VALUE OF SUCH SERVICES AT RATES ESTABLISHED BY THE FOREST SERVICE FOR SIMILAR SERVICES, WHICHEVER IS THE SMALLER.

"2. ALL OF THE COST OF SUPPRESSING ANY SUCH PURCHASER FIRES NEGLIGENTLY CAUSED SHALL BE BORNE BY THE PURCHASER.

"3. FOR SERVICES BY THE PURCHASER PURSUANT TO SECTION 9B-2, OR OTHERWISE AT THE REQUEST OF THE FOREST SERVICE, ON ANY FIRE OTHER THAN A PURCHASER FIRE, THE FOREST SERVICE SHALL PAY THE PURCHASER THE AMOUNT ACTUALLY EXPENDED BY THE PURCHASER OF THE VALUE OF SUCH SERVICES AT RATES ESTABLISHED BY THE FOREST SERVICE FOR SIMILAR SERVICES, WHICHEVER IS SMALLER.

"4. THE PROVISIONS OF THIS SECTION SHALL NOT BE CONSTRUED AS RELIEVING THE PURCHASER OF FIRE SUPPRESSION COSTS FOR WHICH HE IS OTHERWISE LIABLE UNDER STATE LAW.'

WE DO NOT FIND ANY CONTRACT PROVISION COVERING THE DISPOSITION OF AMOUNTS REMAINING ON DEPOSIT AS A BALANCE OF THE CONTRACT PRICE. THUS,THERE COMES INTO OPERATION THE RIGHT OF THE UNITED STATES, AS CONSTRUED BY THE COURTS, TO APPLY SUMS IN ITS HANDS TO THE EXTINGUISHMENT OF DEBTS DUE THE UNITED STATES. SEE SEABOARD SURETY COMPANY V. UNITED STATES, 67 F.SUPP. 969, 971, AND BARRY V. UNITED STATES, 229 U.S. 47.

UNDER THE CONTRACT PROVISION HEREINBEFORE REFERRED TO, AND ON THE BASIS OF YOUR REPORT THAT ONLY $500 HAS BEEN RECEIVED TO DATE FROM MR. MATRIOTTI AND HIS BONDSMEN IN SETTLEMENT OF THE GOVERNMENT'S CLAIM AGAINST MATRIOTTI IN THE AMOUNT OF $2,577.21, THERE APPEARS TO BE NO QUESTION AS TO THE RIGHT OF THE UNITED STATES TO APPLY THE AMOUNT OF $651.36 OF THE PUBLIC VOUCHER FOR REFUNDS IN PARTIAL LIQUIDATION OF THE CONTRACTOR'S INDEBTEDNESS.