B-166450, MAY 22, 1969

B-166450: May 22, 1969

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IS TO PURCHASE THE FOLLOWING DESCRIBED REAL ESTATE FROM SELLER. IF LOAN IS APPROVED * * *. * * * * * * * "SELLER AND PURCHASER AGREE TO CONSUMMATE SALE ON OR BEFORE AUGUST 15. "IT IS UNDERSTOOD AND AGREED THAT THE PURCHASER IS APPLYING FOR AN FHA OR VA LOAN AND THIS CONTRACT IS CONDITIONED UPON SATISFACTORY COMPLETION OF SAID LOAN. IF THE LOAN IS APPROVED DURING THE TIME ALLOTED. "POSSESSION: SELLER AGREES TO GIVE POSSESSION AT TIME SALE IS CONSUMMATED * * *. THE QUOTED PROVISIONS OF THE CONTRACT CLEARLY ARE EXECUTORY. 000) WAS TO BE LIQUIDATED BY THE METHOD OF FINANCING SUBJECT TO CLOSING OF THE LOAN AS SPECIFIED IN THE CONTRACT. BY THE CLOSING ATTORNEY WAS APPROVED AND ACKNOWLEDGED BY THE BORROWER (PURCHASER) AND BY THE SELLER TO BE TRUE AND CORRECT.

B-166450, MAY 22, 1969

TO MISS MILDRED J. KELL:

YOUR LETTER OF MARCH 13, 1969, REFERENCE ADFF:LM, REQUESTS OUR DECISION WHETHER YOU MAY CERTIFY FOR PAYMENT THE ENCLOSED TRAVEL VOUCHER IN THE AMOUNT OF $498.65 WHICH MR. EDWARD O. WIEGAND CLAIMS FOR REAL ESTATE EXPENSES WHICH HE INCURRED IN PURCHASING A HOME SUBSEQUENT TO THE DATE OF TRANSFER OF HIS OFFICIAL STATION FROM JACKSON TO CLARKSDALE, MISSISSIPPI, UNDER TRAVEL AND TRANSFER ORDER NO. SE-JA-67-7 DATED MARCH 16, 1967.

THE ORDER AUTHORIZED TRAVEL TO BEGIN ON OR ABOUT APRIL 23, 1967. THE PAPERS WHICH ACCOMPANIED YOUR LETTER SHOW THAT MR. WIEGAND MOVED HIS HOUSEHOLD GOODS TO CLARKSDALE ON APRIL 18, 1967. HOWEVER, YOU SAY THE TRANSFER OF STATION BECAME EFFECTIVE ON APRIL 23, 1967. THEREAFTER, AS ,PURCHASER" MR. AND MRS. WIEGAND SIGNED A "CONTRACT FOR SALE OF REAL PROPERTY" DATED JANUARY 30, 1968, WHICH PROVIDES IN PERTINENT PART AS FOLLOWS:

"* * * PURCHASER, IS TO PURCHASE THE FOLLOWING DESCRIBED REAL ESTATE FROM SELLER, TOGETHER WITH ALL IMPROVEMENTS THEREON IN PRESENT PHYSICAL CONDITION UNLESS OTHERWISE SPECIFIED HEREIN * * *: LOT 5, WESTWOOD SUBDIVISION, CLARKSDALE, COAHOMA COUNTY, MISSISSIPPI. TOGETHER WITH THE OLLOWING: TO BE BUILT IN ACCORDANCE WITH PLANS AND SPECIFICATIONS. TOTAL PRICE $17,000.00 TO BE PAID BY PURCHASER * * * ON DELIVERY OF DEED AS HEREIN PROVIDED. PURCHASER AGREES TO PAY ALL LOAN CLOSING EXPENSES ESTIMATED TO BE $650.00, INCLUDING PREPAID ITEMS OF APPROXIMATELY $120.00. IF LOAN IS APPROVED * * *.

* * * * * * * "SELLER AND PURCHASER AGREE TO CONSUMMATE SALE ON OR BEFORE AUGUST 15, 1968, AT THE OFFICES * * * IN THE CITY OF CLARKSDALE, MISS. "IT IS UNDERSTOOD AND AGREED THAT THE PURCHASER IS APPLYING FOR AN FHA OR VA LOAN AND THIS CONTRACT IS CONDITIONED UPON SATISFACTORY COMPLETION OF SAID LOAN. DISAPPROVAL OF THE PURCHASER'S APPLICATION * * * SHALL TERMINATE THIS CONTRACT. * * * IF * * * LOAN CANNOT BE SATISFACTORILY COMPLETED ON OR BEFORE THE DATE SET FOR CONSUMMATION OF THIS SALE, THEN THE SELLER AGREES TO REFUND THE EARNEST MONEY. IF THE LOAN IS APPROVED DURING THE TIME ALLOTED, THE PURCHASER AGREES TO PAY USUAL LOAN CLOSING COSTS IN ACCORDANCE WITH VETERANS ADMINISTRATION OR FEDERAL HOUSING ADMINISTRATION PROCEDURE.

* * * * * * * "WARRANTY DEED: SELLER AGREES TO DELIVER A GENERAL WARRANTY DEED, PROPERLY EXECUTED, CONVEYING SAID PROPERTY FREE AND CLEAR OF ALL LIENS WHATSOEVER EXCEPT AS HEREIN PROVIDED TO SAID PURCHASER OR ASSIGNS; PURCHASER SHALL THEN AND THERE PAY THE BALANCE, IF ANY, OF SAID CASH PAYMENT, AND SHALL EXECUTE THE NOTE OR NOTES AND DEED OF TRUST HEREIN PROVIDED FOR. "POSSESSION: SELLER AGREES TO GIVE POSSESSION AT TIME SALE IS CONSUMMATED * * *. "OCCUPANCY: IF PURCHASERS OCCUPY THE PROPERTY * * * BEFORE LOAN CLOSES, PURCHASERS AGREE TO PAY SELLERS RENT * * * UNTIL LOAN CLOSES * * *. "BREACH OF CONDITIONS: IF SELLER FAILS TO COMPLY WITH ANY OF THE ABOVE REQUIREMENTS, WITHIN THE TIME SPECIFIED, THE EARNEST MONEY MAY, AT OPTION OF PURCHASER, BE RETURNED TO PURCHASER UPON RETURN AND CANCELLATION OF THIS RECEIPT OR PURCHASER MAY ENFORCE PERFORMANCE. PURCHASER FAILS TO CONSUMMATE THIS PURCHASE AS SPECIFIED * * * SELLER MAY ENFORCE SPECIFIC PERFORMANCE.'

THE QUOTED PROVISIONS OF THE CONTRACT CLEARLY ARE EXECUTORY, INCLUDING THE CONDITIONAL PROVISION FOR BUILDING A HOUSE ON THE SPECIFIED LOT OF LAND, AND THAT THE TOTAL PRICE THEREOF ($17,000) WAS TO BE LIQUIDATED BY THE METHOD OF FINANCING SUBJECT TO CLOSING OF THE LOAN AS SPECIFIED IN THE CONTRACT. THE LOAN CLOSING STATEMENT DATED JULY 5, 1968, BY THE CLOSING ATTORNEY WAS APPROVED AND ACKNOWLEDGED BY THE BORROWER (PURCHASER) AND BY THE SELLER TO BE TRUE AND CORRECT. THEIR SIGNATURES THERETO AUTHORIZED THAT THE SEVERAL DISBURSEMENTS INDICATED THEREIN BE MADE IN ACCORDANCE THEREWITH. AS A MATTER OF FACT AND LAW, THE SALE WAS "CONSUMMATED" ON THAT DATE WHEN THE PURCHASER AND SELLER CONCURRENTLY EXECUTED AND DELIVERED TO THE CLOSING ATTORNEY THE INSTRUMENTS WHICH THEY HAD MUTUALLY SPECIFIED IN THE CONTRACT FOR RECORDING AS PROVIDED BY APPLICABLE LAW. PRESUMABLY THE PURCHASER ACQUIRED EQUITABLE TITLE TO AND POSSESSION OF THE PROPERTY ON THAT DATE IN ACCORDANCE WITH THE LAW OF THE STATE OF MISSISSIPPI.

THE WORD "SETTLEMENT" AS USED IN SUBSECTION 4.1D OF BUREAU OF THE BUDGET CIRCULAR NO. A-56, REVISED, ISSUED PURSUANT TO AND INTERPRETING SECTION 23 (4), PUBLIC LAW 89-516, 5 U.S.C. 5724A (4), REFERS TO THE CLOSING OF A REAL ESTATE TRANSACTION BY THE PAYMENT OF THE CONTRACT PRICE CONSIDERATION, THE TRANSFER OR CONVEYANCE OF TITLE BY DEED OR OTHERWISE AND THE EXECUTION OF SUCH DOCUMENTS AS CREATE OR EVIDENCE THE LIENS SECURED BY THE REAL ESTATE CONVEYED. WE PERCEIVE NO BASIS UNDER THE REGULATION FOR THE VIEW THAT THE SIGNING OF THE CUSTOMARY AGREEMENT FOR THE PURCHASE OF REAL ESTATE IS TANTAMOUNT TO "SETTLEMENT" AS THAT TERM IS ORDINARILY USED AND UNDERSTOOD. OUR OPINION IS THAT THE SETTLEMENT DATE IN THIS CASE WAS ON JULY 5, 1968. WE NOTE THAT EVEN THE "AGENT'S COMMISSION" DUE FROM THE SELLER WOULD NOT MATURE UNDER THE CONTRACT UNTIL ,ON THE CONSUMMATION OF THE SALE OR UPON BREACH THEREOF.' THEREFORE, IN THE CASE BEFORE US, WE FIND THAT REIMBURSEMENT OF THE REAL ESTATE EXPENSES CLAIMED ON THE ENCLOSED VOUCHER IS PRECLUDED BY THE 1-YEAR LIMITATION CONTAINED IN THE STATUTORY REGULATION, SECTION 4.1D OF CIRCULAR NO. A-56, REVISED, REFERRED TO ABOVE.

ACCORDINGLY, THE VOUCHER RETURNED HEREWITH MAY NOT BE CERTIFIED FOR PAYMENT.