Application of Erroneous Overpayment to Existing Indebtedness

B-186852: Oct 21, 1976

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A check made payable to an agency but drawn on the bank account of a third party may properly be considered as payment from the purchaser and subject to setoff. Where inadvertent, erroneous advice of an agency results in overpayment by a purchaser, the agency has the right and the duty to apply the excess payment to extinguishing existing indebtedness of the purchaser.