B-217638, MAR 6, 1985, OFFICE OF GENERAL COUNSEL

B-217638: Mar 6, 1985

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DISBURSING OFFICERS - RELIEF - ERRONEOUS PAYMENTS - NOT RESULT OF BAD FAITH OR NEGLIGENCE DIGEST: RELIEF IS GRANTED ARMY DISBURSING OFFICIAL AND HIS SUPERVISOR UNDER 31 U.S.C. 3527(C) FROM LIABILITY FOR IMPROPER PAYMENT RESULTING FROM PAYEE'S NEGOTIATION OF BOTH ORIGINAL AND SUBSTITUTE MILITARY CHECKS. PROPER PROCEDURES WERE FOLLOWED IN THE ISSUANCE OF THE SUBSTITUTE CHECK. THERE WAS NO INDICATION OF BAD FAITH ON THE PART OF THE DISBURSING OFFICIAL AND HIS SUPERVISOR. SUBSEQUENT COLLECTION ATTEMPTS HAVE BEEN PURSUED. INDIANA 46249 THIS IS IN RESPONSE TO YOUR REQUEST DATED JANUARY 21. RELIEF IS GRANTED. BOTH CHECKS WERE IN THE SAME AMOUNT. THE SUBSTITUTE CHECK WAS ISSUED ON THE BASIS OF THE PAYEE'S ALLEGATION THAT THE ORIGINAL CHECK HAD NOT BEEN RECEIVED AND A REQUEST FOR STOP PAYMENT HAD BEEN MADE.

B-217638, MAR 6, 1985, OFFICE OF GENERAL COUNSEL

DISBURSING OFFICERS - RELIEF - ERRONEOUS PAYMENTS - NOT RESULT OF BAD FAITH OR NEGLIGENCE DIGEST: RELIEF IS GRANTED ARMY DISBURSING OFFICIAL AND HIS SUPERVISOR UNDER 31 U.S.C. 3527(C) FROM LIABILITY FOR IMPROPER PAYMENT RESULTING FROM PAYEE'S NEGOTIATION OF BOTH ORIGINAL AND SUBSTITUTE MILITARY CHECKS. PROPER PROCEDURES WERE FOLLOWED IN THE ISSUANCE OF THE SUBSTITUTE CHECK, THERE WAS NO INDICATION OF BAD FAITH ON THE PART OF THE DISBURSING OFFICIAL AND HIS SUPERVISOR, AND SUBSEQUENT COLLECTION ATTEMPTS HAVE BEEN PURSUED.

MR. CLYDE E. JEFFCOAT: PRINCIPAL DEPUTY COMMANDER U.S. ARMY FINANCE AND ACCOUNTING CENTER INDIANAPOLIS, INDIANA 46249

THIS IS IN RESPONSE TO YOUR REQUEST DATED JANUARY 21, 1985 THAT LIEUTENANT COLONEL J. G. DEMCHSAK, FINANCE CORPS, FORMER FINANCE AND ACCOUNTING OFFICER, U.S. ARMY FIELD ARTILLERY CENTER, FORT SILL, OKLAHOMA, AND HIS DEPUTY, CAPTAIN K. J. FLOWERS BE RELIEVED OF LIABILITY PURSUANT TO 31 U.S.C. SEC. 3527(C) FOR AN IMPROPER PAYMENT OF A $302.84 CHECK PAYABLE TO MS. PAULA L. RICHARD. FOR THE REASONS STATED BELOW, RELIEF IS GRANTED.

THE LOSS RESULTED WHEN THE PAYEE NEGOTIATED BOTH THE ORIGINAL AND A SUBSTITUTE CHECK. BOTH CHECKS WERE IN THE SAME AMOUNT. THE SUBSTITUTE CHECK WAS ISSUED ON THE BASIS OF THE PAYEE'S ALLEGATION THAT THE ORIGINAL CHECK HAD NOT BEEN RECEIVED AND A REQUEST FOR STOP PAYMENT HAD BEEN MADE. BOTH CHECKS WERE ISSUED BY THE ARMY UNDER AUTHORITY DELEGATED BY THE DEPARTMENT OF THE TREASURY. 31 C.F.R. SEC. 245.8.

THE SUBSTITUTE CHECK HERE WAS SIGNED BY THE FINANCE AND ACCOUNTING OFFICER'S DEPUTY, WHICH REQUIRES THAT WE RELIEVE THE FINANCE AND ACCOUNTING OFFICER IN HIS SUPERVISORY CAPACITY AS WELL AS THE DEPUTY AS DISBURSING OFFICER. WE HAVE CONCLUDED THAT WHERE A SUBSTITUTE CHECK IS PROPERLY ISSUED THE SUPERVISOR IS NO MORE NEGLIGENT THAN THE DEPUTY WHO ACTUALLY SIGNED THE CHECK. B-212576, ET AL., DECEMBER 2, 1983.

IT APPEARS THAT THE REQUEST FOR STOP PAYMENT AND THE ISSUANCE OF A SUBSTITUTE CHECK IN THIS CASE WERE WITHIN THE BOUNDS OF DUE CARE AS ESTABLISHED BY ARMY REGULATIONS. SEE AR 37-103, PARAS. 4-161, 4-162 AND 4 -164. THERE WAS NO INDICATION OF BAD FAITH ON THE PART OF THE DISBURSING OFFICERS. SEE 62 COMP.GEN. 91, 94 (1982). ALSO, AGGRESSIVE COLLECTION ATTEMPTS ARE BEING MADE TO COLLECT THIS DEBT IN ACCORDANCE WITH THE FEDERAL CLAIMS COLLECTION ACT, AS AMENDED, 31 U.S.C. SEC. 3711 ET SEQ., AND THE PROCEDURES OUTLINED IN OUR DECISION 62 COMP.GEN. 476 (1983). RELIEF IS THEREFORE GRANTED.