B-24402 September 21, 1942

B-24402: Sep 21, 1942

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North Carolina Gentlemen: I have your letter of August 27. As follows: "We have several motor transport lines who are customers of ours and who are doing a very substantial amount of Government hauling at the present time. We have been approached on several occasions recently regarding the matter of financing Government invoices covering this hauling as in several cases these carriers get several thousand dollars tied up in these invoices before payment comes through. "We have heretofore financed several flight school contracts and are familiar with the procedure in such cases but as this business comes under a different category we are writing to inquire as to how we could finance our customers.

B-24402 September 21, 1942

The Citizens National Bank, 206 West Main Avenue, Gastonia, North Carolina

Gentlemen:

I have your letter of August 27, 1942, as follows:

"We have several motor transport lines who are customers of ours and who are doing a very substantial amount of Government hauling at the present time. We have been approached on several occasions recently regarding the matter of financing Government invoices covering this hauling as in several cases these carriers get several thousand dollars tied up in these invoices before payment comes through.

"We have heretofore financed several flight school contracts and are familiar with the procedure in such cases but as this business comes under a different category we are writing to inquire as to how we could finance our customers.

"If it is necessary to assign each hauling contract it will require a great amount of paper work and trouble for all parties concerned. We were wondering if, for instance, the Smith Motor Lines could update an assignment in our favor of all amounts due to it by the United States Government for freight bills and then type the regular assignments notice on all invoices as they are sent in to various disbursing offices. If it were possible to handle such account with one blanket assignment as suggested it would greatly simplify the matter and put us in position to furnish funds to various customers of ours who are badly cramped at the present time.

"Any suggestions which you can give us will be greatly appreciated."

The assignment of Claims Act of 1940, 54 Stat. 1029, authorizes assignments of moneys due or to become due under contracts with the United States under certain conditions stipulated in the act, one of which being that the contract provide for payments aggregating $1,000 or more. The procedure to be followed in the event of any such assignment is set out in the act. While it is not permissible to make an assignment with respect to a contract or contracts not in existence, there would appear to be no objection to one instrument of assignment covering several contracts already entered into if each of the contracts provides for payments aggregating $1,000 or more and the assignment otherwise complies with the Assignment of claims Act of 1940. In such event, however, there should be filed, pursuant to the act, sufficient copies of the notice and instrument of assignment for attaching to the contracts involved.

Respectfully,

Comptroller General of the United States