Claim for Attorney Fees Incident to Sale of House

B-205515: Jun 2, 1982

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Julie Matta
(202) 512-4023


Office of Public Affairs
(202) 512-4800

A transferred Federal employee requested that GAO reconsider its earlier decision which limited the amount of reimbursement for attorney fees resulting from the sale of her residence. The issue was whether the employee could be reimbursed for an amount greater than is customarily charged for such services within the locality of the transaction. Necessary and reasonable legal fees incurred during the purchase or sale of a residence incident to a permanent change of station may be reimbursed provided that the costs are within the range customary in the locality for such services. Assistance in determining the reasonableness of an expense may be obtained from the Department of Housing and Urban Development (HUD). GAO had previously decided that the employee should only be reimbursed for the amount that HUD determined was customary in the locality. The claimant contended that: (1) the HUD determination of customary charges for attorney fees was restrictive and unfair, and (2) the GAO adjudicatory policy and the HUD process for establishing customary legal fees are overly stringent in the prevailing economic conditions in real estate markets. GAO held that: (1) the Federal regulations questioned by the claimant were not arbitrary, capricious, or contrary to law; and (2) even though the type of contract used resulted in significantly higher attorney's fees than usual, there was no basis for paying such fees in excess of the customary maximum charges for the locality of the transaction. Accordingly, the claim for additional reimbursement of attorney fees was denied.

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