B-80544, DEC 9, 1948

B-80544, DEC 9, 1948

PRECIS-UNAVAILABLE

LIEUTENANT COLONEL C. W. CONKLIN, F.D., U.S. ARMY:

THERE HAS BEEN RECEIVED BY REFERENCE FROM THE OFFICE OF THE CHIEF OF FINANCE, DEPARTMENT OF THE ARMY, YOUR 1ST INDORSEMENT DATED JULY 22, 1948, TRANSMITTING RECLAIM VOUCHER SE897 IN THE AMOUNT OF $216.90 STATED IN FAVOR OF SEATTLE FIRST NATIONAL BANK, ASSIGNEE FOR S. BIRCH & SONS CONSTRUCTION COMPANY, AL JOHNSON CONSTRUCTION COMPANY, C.F. LYTLE COMPANY, UNDER COST-PLUS-A-FIXED-FEE CONTRACT W112-ENG-1000, ENTERED INTO MAY 17, 1946, WITH THE REQUEST THAT AN ADVANCE DECISION BE RENDERED AS TO WHETHER PAYMENT ON THE VOUCHER IS AUTHORIZED.

THE VOUCHER COVERS RECLAIM OF AN AMOUNT COLLECTED FROM THE CONTRACTOR AS A RESULT OF EXCEPTION TAKEN BY THE AUDIT DIVISION OF THE GENERAL ACCOUNTING OFFICE TO REIMBURSEMENT OF EXPENSES FOR MEDICAL SERVICES FURNISHED AXEL N. EDHOLM, CONTRACTOR'S EMPLOYEE, WHO SUSTAINED INJURIES WHILE BEING TRANSPORTED TO THE JOB SITE IN ALASKA.

UNDER THE TERMS OF THE CONTRACT THE CONTRACTOR WAS REQUIRED TO "FURNISH THE LABOR, MATERIALS, TOOLS, MACHINERY, EQUIPMENT, FACILITIES, SUPPLIES, AND SERVICES NOT FURNISHED BY THE GOVERNMENT; AND DO ALL THINGS NECESSARY FOR THE COMPLETION" OF THE WORK DESCRIBED IN ARTICLE I OF THE CONTRACT. IN CONSIDERATION FOR THE UNDERTAKING, THE CONTRACTOR WAS TO RECEIVE REIMBURSEMENT AS PROVIDED IN ARTICLE III OF THE CONTRACT AS WAS TO BE PAID A FIXED FEE WHICH WAS TO CONSTITUTE COMPLETE COMPENSATION FOR THE CONTRACTOR'S SERVICES, INCLUDING PROFIT AND ALL GENERAL OVERHEAD EXPENSES.

ARTICLE II, PARAGRAPH 1, SUBPARAGRAPH U OF THE CONTRACT PROVIDES AS FOLLOWS:

"IT IS MUTUALLY RECOGNIZED THAT THERE ARE DETAILS RELATIVE TO EMPLOYMENT OF LABOR AND PERSONNEL WITH REFERENCE TO PAYMENT OF WAGES AND SALARIES AND ALLOTMENTS THEREOF, INSURANCE AND OTHER MATTERS WHICH WILL BE COVERED BY SEPARATE AGREEMENTS TO BE ENTERED INTO BETWEEN THE CONTRACTOR AND ITS EMPLOYEES. SUCH EMPLOYMENT CONTRACTS WILL BE ADVANTAGEOUS TO THE ACCOMPLISHMENT OF THE WORK AND SERVICES UNDER THIS CONTRACT AND THE CONTRACTOR MAY, SUBJECT TO THE WRITTEN APPROVAL OF THE CONTRACTING OFFICER, ENTER INTO SUCH AGREEMENT OR AGREEMENTS OF EMPLOYMENT NOT INCONSISTENT WITH ANY OF THE EXPRESS PROVISIONS OF THIS CONTRACT AS MAY BE DEEMED NECESSARY OR DESIRABLE. AUTHORIZED DISBURSEMENTS UNDER THE PROVISIONS OF SUCH APPROVED EMPLOYMENT AGREEMENTS SHALL BE CONSIDERED LABOR COSTS REIMBURSABLE UNDER THIS CONTRACT."

THE EMPLOYMENT AGREEMENT UNDER WHICH THE EMPLOYEE WAS HIRED, PROVIDES IN PERTINENT PART, AS FOLLOWS:

"8. TOTAL TRANSPORTATION COST: SUBJECT TO OTHER PROVISIONS OF THIS CONTRACT, TRANSPORTATION COST SHALL BE ALLOWED BY THE EMPLOYER TO THE EMPLOYEE IN CONFORMITY WITH THE FOLLOWING TERMS:

"A. TRANSPORTATION: SHALL BE FURNISHED OR ACTUAL NECESSARY COST ALLOWED TO THE EMPLOYEE FROM THE POINT OF HIRE TO THE PROJECT AND RETURN TO THE POINT OF HIRE, BY SUCH MADE OF TRAVEL AS PREVIOUSLY SET FORTH.

"10. HOSPITALIZATION AND MEDICAL CARE: TO THE EXTEND FOUND DESIRABLE TO KEEP THE EMPLOYEE IN CONDITION TO RENDER PROPER SERVICE, THE EMPLOYER WILL FURNISH SUCH FREE HOSPITALIZATION AND MEDICAL CARE AS MAY BE AVAILABLE AT CONTRACTOR OR GOVERNMENT FACILITIES OPERATED AT THE JOB SITE. ***"

THE NATURE OF THE EXPENSES INVOLVED AND THE CONTRACTOR'S VIEWS RELATIVE THERETO ARE SET FORTH IN A LETTER DATED MAY 11, 1948, FROM THE CONTRACTOR TO THE DISTRICT ENGINEER, SEATTLE, WASHINGTON. IT IS STATED IN SAID LETTER THAT THE EMPLOYEE WAS RECRUITED FOR WORK IN ALASKA AT MINNEAPOLIS, MINNESOTA; THAT ON NOVEMBER 9, 1946, HE ENTERED INTO A CONTRACT OF EMPLOYMENT WITH THE CONTRACTOR; THAT THE EMPLOYEE WAS TRANSPORTED TO FAIRBANKS, ALASKA, BY PLANE AT THE CONTRACTOR'S EXPENSE; THAT THE PLANE STOPPED AT PORT HARDY, B.C., FOR REFUELING; THAT IN WALKING ACROSS THE RUNWAY AT THAT PLACE HE SLIPPED ON THE ICE AND FELL, FRACTURING SOME OF HIS RIBS; AND THAT HE CONTINUED ON THE PLANE TO JUNEAU, ALASKA, WHERE HE WAS TREATED FOR HIS FRACTURED RIBS AND TRAUMATIC PNEUMONIA WHICH HAD DEVELOPED, AT A COST OF $216.90 TO THE CONTRACTOR.

THE RIGHTS AND LIABILITIES OF THE PARTIES TO THE EMPLOYMENT AGREEMENT ARE FOR DETERMINATION IN ACCORDANCE WITH THE TERMS THEREOF. IN VIEW OF THE FACT THAT IT IS STIPULATED IN ARTICLE 10 OF THE EMPLOYMENT AGREEMENT THAT THE CONTRACTOR SHALL PROVIDE SUCH FREE HOSPITALIZATION AND MEDICAL CARE AS MAY BE AVAILABLE AT CONTRACTOR OR GOVERNMENT FACILITIES OPERATED AT THE JOB SITE, AND SINCE NO PROVISION WAS MADE IN THE AGREEMENT OR OTHERWISE FOR PAYMENT BY THE CONTRACTOR OF MEDICAL EXPENSES WHILE THE EMPLOYEE WAS AWAY FROM THE JOB SITE OR EN ROUTE THERETO, THE EXPENSE INVOLVED MAY NOT BE REGARDED AS AN ALLOWABLE ITEM OF COST UNDER THE CONTRACT.

HOWEVER, THE RECORDS SHOW THAT THE CONTRACTOR RECOVERED FROM THE PAN AMERICAN AIRWAYS' INSURANCE CARRIER $108.45, OR 50 PERCENT OF THE HOSPITAL AND MEDICAL EXPENSES CLAIMED. CREDIT OF THIS AMOUNT IS REFLECTED IN THE SUMMARY OF DEBITS AND CREDITS SUPPORTING D. O. VOUCHER 34617, NOVEMBER 1947 ACCOUNT OF J. H. MCFALL. SUBSEQUENT THERETO, $216.90 WAS DEDUCTED FROM OTHER AMOUNTS DUE THE CONTRACTOR, THEREBY RESULTING IN AN OVERCOLLECTION OF $108.45. THIS AMOUNT PROPERLY IS DUE THE CONTRACTOR.

ACCORDINGLY, THE VOUCHER, TOGETHER WITH SUPPORTING PAPERS, IS RETURNED HEREWITH, AND YOU ARE ADVISED THAT PAYMENT THEREON IN THE AMOUNT OF $108.45 ONLY IS AUTHORIZED, IF OTHERWISE CORRECT.