B-179979, MAR 7, 1974

B-179979, MAR 7, 1974

CLAIM FOR REIMBURSEMENT FOR CARRYING CHARGE (RENT) FROM JAN. 16 TO FEB. 15, 1972 INCURRED INCIDENT TO TERMINATION OF LEASE ON COOPERATIVE APARTMENT IN CONNECTION WITH PERMANENT CHANGE OF STATION IN JANUARY 1972 IS ALLOWED SINCE ALTHOUGH OCCUPANCY AGREEMENT PROVIDES FOR SUBLEASING WITH COMPANY'S CONSENT, EMPLOYEE'S EXPLANATION THAT IT IS NOT POLICY OF COMPANY TO ALLOW SUBLEASES FOR SUCH SHORT PERIOD OF TIME IS REASONABLE. HOWEVER, CLAIMS FOR VARIOUS OTHER EXPENSES INCURRED ARE DISALLOWED FOR REASONS STATED. SEE COMP. GEN. DECS. CITED.

TO MR. MYRON S. NOVAK:

REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 2, 1973, IN WHICH YOU APPEAL THE DENIAL OF YOUR CLAIM BY THE TRANSPORTATION AND CLAIMS DIVISION OF THIS OFFICE FOR EXPENSES INCURRED INCIDENT TO THE TERMINATION OF THE LEASE ON YOUR COOPERATIVE APARTMENT. THAT TERMINATION WAS IN CONNECTION WITH YOUR PERMANENT CHANGE OF STATION IN JANUARY 1972 FROM BROOKLYN, NEW YORK, TO HYATTSVILLE, MARYLAND, AS AN EMPLOYEE OF THE DEPARTMENT OF THE NAVY.

YOU INDICATE THAT YOU RECEIVED NOTIFICATION OF A PERMANENT CHANGE OF STATION FROM BROOKLYN, NEW YORK, TO HYATTSVILLE, MARYLAND, ABOUT DECEMBER 8, 1971, AND THAT BY DECEMBER 15, 1971, YOU HAD NOTIFIED THE MANAGEMENT AGENT FOR THE COOPERATIVE APARTMENT IN WHICH YOU WERE LIVING OF YOUR INTENTION TO MOVE.

YOU CLAIM REIMBURSEMENT FOR AND HAVE PROVIDED DOCUMENTATION SHOWING PAYMENT OF (1) AN EXPENSE IN THE AMOUNT OF $121.39 FOR MATERIALS NEEDED TO RESTORE THE FLOORS OF THE APARTMENT TO THEIR ORIGINAL CONDITION, (2) A PAYMENT OF $75 TO THE NEW TENANT IN LIEU OF FURTHER WORK ON THE FLOORS OF THE APARTMENT, (3) A CARRYING CHARGE (RENT) OF $107.18, (4) AN ANNUAL AIR CONDITIONING CHARGE OF $48, AND (5) A STATE TRANSFER TAX OF $17.98.

ALTHOUGH YOU HAD AN EQUITY IN THE HOUSING CORPORATION, AS EVIDENCED BY THE 719 SHARES OF STOCK YOU OWNED, WE BELIEVE THAT FOR PURPOSES OF REIMBURSEMENT YOUR ARRANGEMENT SHOULD BE TREATED AS A LEASE BECAUSE THE OCCUPANCY AGREEMENT WAS FOR A LIMITED PERIOD OF TIME, THE PARTIES WERE REFERRED TO AS THE LESSOR AND LESSEE IN THAT AGREEMENT, AND IT OTHERWISE HAD THE FEATURES OF A LEASE.

REIMBURSEMENT FOR THE COSTS OF SETTLING AN UNEXPIRED LEASE AT AN EMPLOYEE'S OLD STATION INCIDENT TO A CHANGE OF STATION WAS GOVERNED, DURING THE PERIOD INVOLVED, BY SECTION 4.2H OF OFFICE OF MANAGEMENT AND BUDGET CIRCULAR NO. A-56, REVISED, AUGUST 17, 1971, WHICH PROVIDED:

"H. SETTLEMENT OF AN UNEXPIRED LEASE. EXPENSES INCURRED FOR SETTLING AN UNEXPIRED LEASE (INCLUDING MONTH-TO-MONTH RENTAL) ON RESIDENCE QUARTERS OCCUPIED BY THE EMPLOYEE AT THE OLD OFFICIAL STATION MAY INCLUDE BROKER'S FEES FOR OBTAINING A SUBLEASE OR CHARGES FOR ADVERTISING AN UNEXPIRED LEASE. SUCH EXPENSES ARE REIMBURSABLE WHEN (1) APPLICABLE LAWS OR THE TERMS OF THE LEASE PROVIDE FOR PAYMENT OF SETTLEMENT EXPENSES, (2) SUCH EXPENSES CANNOT BE AVOIDED BY SUBLEASE OR OTHER ARRANGEMENT, (3) THE EMPLOYEE HAS NOT CONTRIBUTED TO THE EXPENSE BY FAILING TO GIVE APPROPRIATE LEASE TERMINATION NOTICE PROMPTLY AFTER HE HAS DEFINITE KNOWLEDGE OF THE PROPOSED TRANSFER, AND (4) THE BROKER'S FEES OR ADVERTISING CHARGES ARE NOT IN EXCESS OF THOSE CUSTOMARILY CHARGED FOR COMPARABLE SERVICES IN THAT LOCALITY. ITEMIZATION OF THESE EXPENSES IS REQUIRED AND THE TOTAL AMOUNT WILL BE ENTERED ON AN APPROPRIATE TRAVEL VOUCHER. THIS VOUCHER MAY BE SUBMITTED SEPARATELY OR WITH A CLAIM THAT IS TO BE MADE FOR EXPENSES INCIDENT TO THE PURCHASE OF A DWELLING. EACH ITEM MUST BE SUPPORTED BY DOCUMENTATION SHOWING THAT THE EXPENSE WAS IN FACT INCURRED AND PAID BY THE EMPLOYEE."

CONCERNING YOUR CLAIM FOR REIMBURSEMENT FOR THE CARRYING CHARGE OR RENT FROM JANUARY 16 TO FEBRUARY 15, 1972, WE NOTE THAT THE SIXTH PARAGRAPH OF THE OCCUPANCY AGREEMENT PROVIDES FOR SUBLEASING WITH THE COMPANY'S CONSENT. YOU STATED IN YOUR LETTER OF OCTOBER 2, 1973, THAT IT IS NOT THE POLICY OF THE COMPANY TO ALLOW SUBLEASES FOR SUCH A SHORT PERIOD OF TIME. WE BELIEVE THIS EXPLANATION OF THE REASON FOR YOUR INCURRING THE RENTAL CHARGE FOR THE PART OF JANUARY AFTER YOU WERE TRANSFERRED IS REASONABLE AND HAVE DIRECTED THE TRANSPORTATION AND CLAIMS DIVISION TO ALLOW THIS PART OF YOUR CLAIM IN THE AMOUNT OF $107.18.

YOU STATE IN YOUR ITEMIZED CLAIM FOR COSTS THAT "*** I PAID NEW TENANT $75.00 FOR ONE-HALF MONTH RENT ON HIS APARTMENT SO THAT HE COULD TAKE UNTIL 15 FEBRUARY TO RESTORE THE FLOORS." YOU ALSO ENCLOSED RECEIPTED BILLS TOTALING $121.39 WHICH YOU INDICATE WERE FOR THE PURCHASE OF MATERIALS WHICH YOU USED IN RESTORING SOME OTHER FLOORS IN THE APARTMENT TO THEIR ORIGINAL CONDITION.

AS TO REIMBURSEMENT FOR THESE ITEMS THE OCCUPANCY AGREEMENT GOVERNING YOUR USE OF THE APARTMENT PROVIDED THAT ALTERATIONS WOULD NOT BE MADE AND IN EFFECT THAT THE PREMISES WOULD BE RETURNED TO ORIGINAL CONDITION AT THE EXPENSE OF THE TENANT PRIOR TO TERMINATION OF THE LEASE AGREEMENT. SEE PARAGRAPHS 10, 11 AND 14(6) OF THAT AGREEMENT. IT THUS APPEARS THAT EVEN IF YOU HAD NOT TRANSFERRED TO HYATTSVILLE, MARYLAND, YOU WOULD HAVE BEEN REQUIRED BY YOUR OCCUPANCY AGREEMENT TO RESTORE THE FLOORS. SINCE THESE COSTS WERE OBLIGATIONS FOR WHICH YOU WOULD HAVE BEEN RESPONSIBLE REGARDLESS OF A CHANGE IN STATION THEY ARE NOT REIMBURSABLE ITEMS. SEE 52 COMP. GEN. 275 (B-176879, NOVEMBER 16, 1972, COPY ENCLOSED). ANY CHANGE IN THE POLICY OF THE LANDLORD WITH RESPECT TO THE RESTORATION OF FLOORS TO THEIR ORIGINAL CONDITION SUBSEQUENT TO THE TERMINATION OF YOUR LEASE WOULD NOT CHANGE THE NATURE OF THESE EXPENSES OR THE REQUIREMENTS OF YOUR AGREEMENT AND WOULD PROVIDE NO BASIS FOR THEIR ALLOWANCE.

REGARDING THE ANNUAL AIR CONDITIONING CHARGE, IT APPEARS THAT UNDER THE RULES OF THE LESSOR AN ANNUAL CHARGE OF $48 WAS ASSESSED FOR THE USE OF AIR CONDITIONING EQUIPMENT ON THE PREMISES AND THAT THIS CHARGE COULD NOT BE PRORATED BASED ON OCCUPANCY FOR LESS THAN 1 YEAR. THE GOVERNING REGULATIONS MAKE NO SPECIFIC PROVISION FOR REIMBURSEMENT OF THIS TYPE OF CHARGE IN CONNECTION WITH TERMINATION OF LEASES. THEREFORE, FOR SUCH A CHARGE TO BE REIMBURSABLE, IT WOULD HAVE TO COME UNDER THE MISCELLANEOUS EXPENSES PROVISIONS CONTAINED IN SECTION 3 OF CIRCULAR NO. A-56. THE INFORMATION YOU HAVE PRESENTED DOES NOT ESTABLISH THAT YOU HAVE QUALIFIED FOR REIMBURSEMENT OF THIS EXPENSE UNDER THE PROVISIONS OF THAT SECTION AND ON THE PRESENT RECORD REIMBURSEMENT MAY NOT BE ALLOWED.

CONCERNING THE $17.98 EXPENSE FOR NEW YORK STATE TRANSFER TAX, IT APPEARS THAT YOU WOULD HAVE BEEN LIABLE FOR SUCH TAX WHEN THE LEASE WAS TERMINATED EVEN THOUGH TERMINATION HAD NOT BEEN CAUSED BY A CHANGE IN YOUR OFFICIAL STATION. AS SUCH YOUR LIABILITY FOR THAT CHARGE DID NOT RESULT FROM THE TRANSFER OF STATION OR THE SETTLEMENT OF AN UNEXPIRED LEASE. UNDER THE TERMS OF SECTION 4.2H OF CIRCULAR NO. A-56, AS QUOTED ABOVE, THAT CHARGE IS NOT REIMBURSABLE.

AS INDICATED ABOVE THE TRANSPORTATION AND CLAIMS DIVISION OF THIS OFFICE HAS BEEN INSTRUCTED TO ALLOW YOUR CLAIM IN THE AMOUNT OF $107.18 COVERING THE CARRYING CHARGE (RENT) YOU PAID FROM THE DATE YOU MOVED OUT OF THE APARTMENT INCIDENT TO YOUR TRANSFER TO THE DATE THE APARTMENT WAS RELET.