B-171163, DEC 4, 1970

B-171163: Dec 4, 1970

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THE ASSIGNMENT WAS MADE IN RETURN FOR A LOAN BY THE BANK TO SKYWAY INTERNATIONAL CORPORATION. PARENT CORPORATION OF SKY HAVEN AND THE FUNDS LOANED WERE USED BY SKY HAVEN. UNDER THESE CONDITIONS THE ASSIGNMENT TO THE BANK WAS NOT EFFECTIVE AGAINST THE U.S. SHAFFER: REFERENCE IS MADE TO YOUR LETTERS OF OCTOBER 13 AND 21. OUR CLAIMS DIVISION DENIED THE CLAIM ON THE BASIS THAT THE ASSIGNMENT WAS MADE IN RETURN FOR A LOAN BY THE BANK TO SKYWAY INTERNATIONAL CORPORATION OF UTAH. THAT UNDER THESE CONDITIONS THE ASSIGNMENT OF THE CONTRACT TO THE BANK WAS NOT EFFECTIVE AGAINST THE UNITED STATES. YOU REPORT THAT SKYWAY IS A PARENT CORPORATION OF SKY HAVEN. WHICH IS A "DBA" REGISTERED UNDER SKYWAY INTERNATIONAL CORPORATION OF UTAH AND THAT THE FUNDS LOANED BY THE BANK TO SKYWAY ($5.

B-171163, DEC 4, 1970

CONTRACTS - ASSIGNMENT - NOTICE REAFFIRMING DECISION DENYING CLAIM OF FARMERS STATE BANK OF WOODS CROSS, UTAH, FOR AN AMOUNT ALLEGED DUE UNDER AN ASSIGNMENT OF FUNDS FROM SKY HAVEN AERO REPAIR ON CONTRACT WITH DEFENSE SUPPLY AGENCY. THE ASSIGNMENT WAS MADE IN RETURN FOR A LOAN BY THE BANK TO SKYWAY INTERNATIONAL CORPORATION, A STRANGER TO THE CONTRACT, PARENT CORPORATION OF SKY HAVEN AND THE FUNDS LOANED WERE USED BY SKY HAVEN. UNDER THESE CONDITIONS THE ASSIGNMENT TO THE BANK WAS NOT EFFECTIVE AGAINST THE U.S. BECAUSE IT FAILED TO MEET THE NOTICE REQUIREMENTS OF THE ASSIGNMENT OF CLAIMS ACT, 31 U.S.C. 203; 41 U.S.C. 15.

TO MR. CARVEL R. SHAFFER:

REFERENCE IS MADE TO YOUR LETTERS OF OCTOBER 13 AND 21, 1970, REQUESTING REVIEW OF OUR SETTLEMENT NO. Z 2427207, DATED SEPTEMBER 24, 1970, WHICH DENIED YOUR CLAIM ON BEHALF OF THE FARMERS STATE BANK OF WOODS CROSS, UTAH, FOR AN AMOUNT ALLEGED TO BE DUE UNDER AN ASSIGNMENT OF FUNDS FROM SKY HAVEN AERO REPAIR ON CONTRACT NO. F42600-68-C-2384 WITH THE DEFENSE SUPPLY AGENCY, DATED JANUARY 30, 1968.

OUR CLAIMS DIVISION DENIED THE CLAIM ON THE BASIS THAT THE ASSIGNMENT WAS MADE IN RETURN FOR A LOAN BY THE BANK TO SKYWAY INTERNATIONAL CORPORATION OF UTAH, A STRANGER TO THE CONTRACT, AND THAT UNDER THESE CONDITIONS THE ASSIGNMENT OF THE CONTRACT TO THE BANK WAS NOT EFFECTIVE AGAINST THE UNITED STATES. YOU REPORT THAT SKYWAY IS A PARENT CORPORATION OF SKY HAVEN, THE CONTRACTOR, WHICH IS A "DBA" REGISTERED UNDER SKYWAY INTERNATIONAL CORPORATION OF UTAH AND THAT THE FUNDS LOANED BY THE BANK TO SKYWAY ($5,785.65) WERE USED BY SKY HAVEN FOR PERFORMANCE OF THE CONTRACT.

IN ANY EVENT, THE RECORD SHOWS THAT YOUR CLAIM WAS DENIED BY THE DEFENSE SUPPLY AGENCY (DSA) BECAUSE YOU FAILED TO COMPLY WITH THE NOTICE REQUIREMENTS OF THE ASSIGNMENT OF CLAIMS ACT, 31 U.S.C. 203; 41 U.S.C. 15. IN ORDER TO PERFECT AN ASSIGNMENT UNDER THAT ACT, THE ASSIGNEE MUST FILE WRITTEN NOTICE OF THE ASSIGNMENT TOGETHER WITH A TRUE COPY OF THE INSTRUMENT OF ASSIGNMENT WITH THE PARTIES SPECIFIED IN THE ACT, NAMELY, THE CONTRACTING OFFICER, THE SURETY, IF ANY, AND THE DISBURSING OFFICER, IF ANY, DESIGNATED IN THE CONTRACT TO MAKE PAYMENT. THE CONTRACT IN THIS CASE SPECIFIED THAT PAYMENT WOULD BE MADE BY THE DIRECTOR, DCSAR, SAN FRANCISCO, 866 MALCOLM ROAD, BURLINGAME, CALIFORNIA. NOTICE OF THE ASSIGNMENT SHOULD HAVE BEEN FILED WITH THE FINANCE OFFICE AT BURLINGAME, CALIFORNIA. WHILE YOU ALLEGED TO DSA THAT THE ASSIGNMENT WAS FILED WITH THAT OFFICE, THIS HAS BEEN DENIED BY DSA. IN FORWARDING THE MATTER TO OUR CLAIMS DIVISION, IN SEPTEMBER 1970, DSA REPORTED THAT THE BANK HAD NOT FILED THE INSTRUMENT OF ASSIGNMENT AND NOTICE OF ASSIGNMENT WITH THE FINANCE OFFICER AND AS A RESULT PAYMENT WAS MADE TO THE CONTRACTOR.

BASED ON THE EVIDENCE OF RECORD, WE CANNOT CONCLUDE THAT THERE WAS COMPLIANCE WITH THE NOTICE REQUIREMENTS. THEREFORE, WE MUST DENY YOUR CLAIM. SEE B-159494, SEPTEMBER 2, 1966.