Request for Waiver of Indebtedness

A Federal employee requested reconsideration of a Claims Division action denying him complete waiver of the Government's claim against him for the recovery of erroneous temporary lodging allowance payments he received incident to a transfer from the United States to Europe. The employee had continued to receive temporary lodging allowance payments after he had moved into permanent quarters. The employee was advised that he was obligated to refund the total net overpayments he had received, and he arranged to make that refund through regular deductions from his salary. The employee later requested that the refund requirement be waived. He indicated that he had noticed the overpayments and that he had notified the concerned finance and housing management officials and made reasonable efforts to have the error corrected. In those circumstances, the employee did not feel that it was his fault that he was overpaid, and he suggested that he should therefore be entitled to a complete waiver of the claim against him. The Claims Division concluded that the employee was at fault in the matter since he knew he was being overpaid and should have retained the excess amounts for their eventual refund. It is a fundamental and long-established rule of law that a person receiving money erroneously paid by a Government agency or official acquires no right to that money and is liable to make restitution. Restitution results in no loss to the recipient, since he merely received something which he was never entitled to have in the first place. It appeared that the employee knew that the payments he received were erroneous, that the excess payments were caused solely by administrative error, that the employee informed the appropriate officials about the error, and that he set aside the overpayments he received. In these circumstances, GAO found no indication of fault on the employee's part which would operate to preclude a grant of waiver. However, an employee is not entitled to a grant of waiver as a matter of legal right every time he receives an excessive payment of pay or allowances through an administrative error and through no fault of his own. While the actions the employee took to set aside the excess payments and notify the appropriate officials were commendable, requiring him to refund those overpayments was neither against equity and good conscience nor contrary to the best interests of the Unites States. The Claims Division's denial was sustained.