B-182512-0.M. August 6, 1975

B-182512-0.M. August 6, 1975

DIGEST

Director, TCD

Returned. On November 25, 1974, we referred the certified indebtedness of Pacific Agriculture Cooperative Association (Pacific) for $14,970.29 to the Department of Justice for purposes of collecting the debt. On January 27, 1975, the file was returned to us since Pacific Agriculture Cooperative Association was found to have no discernable assets worth pursuing. Consequently, on February 12, 1975, we instructed you that, pursrant to 31 U.S.C. Sec. 952(b) and 4 C.F.R. Sec. 104.3, a caveat be established and the papers sent to the closed files.

We are of the opinion that the application of Treasury check number 4,591,878 for $1,094.60 to Pacific's outstanding debt of $14,970,28 would not prejudice the collection procedure. Funds otherwise due Pacific may be used to offset an outstanding indebtedness written off as uncollectible. See 48 Comp. Gen. 365, 369 (1970):

"Concerning the legality of taking action to satisfy an indebtedness once it has been declared uncollectible, it appears that an administrative determination of uncollectibility is for accounting purposes only and, as such, does not preclude the subsequent satisfaction of the indebtedness should the opportunity to do so thereafter be presented to the administrative office."

Accordingly, the $1,094.60 should be credited against the outstanding indebtedness, and the papers returned to the closed files subject to the caveat that should additional funds become available, the file may be reopened and the funds credited accordingly.

Paul G. Dembling General Counsel

Attachment

Feb 12, 1975

Director, TCD

Assistant General Counsel, OGC - L. Mitchell Dick

Indebtedness of Pacific Agriculture Cooperative Association for excess transportation charges of $14,970.28

By letter of November 25, 1974, this indebtedness was referred to the Department of Justice for such further action as it deemed appropriate. On January 27, 1975, the Department of Justice returned the matter to us "*** for failure to provide evidence of collectibility as required by the Federal Claims Collection Act," (the "Act") 31 U.S.C. Secs. 951, et seq. (1970).

4 CFR Sec. 105.3(a) promulgated pursuant to the Act provides that:

"Claims referred *** to the Department of Justice for litigation, will be accompanied by reasonably current credit data indicating that there is a reasonable prospect of effecting enforced collections from the debtor, having due regard for the exemptions available to the debtor under State and Federal law and the judicial remedies available to the Government."

The credit report in the record indicates that the possibility of collection is remote. Therefore, pursuant to 31 U.S.C. Sec. 952(b) and 4 CFR Sec. 104.3, we recommend that a caveat be established and that the papers be sent to the closed files.

The General Counsel

JUN 30, 1975

TC-SR-TK-173485-LR

Director, TCD - By C. E. Martz

Pacific Agriculture Cooperative Association - Indebtedness

Please refer to your file B-182512 wherein you referred the indebtedness of $14,970.38 by the subject carrier to the Department of Justice.

Please be advised that Treasury check No. 4,591,878, for $1,094.60, is being held in this Office, pending advice from you whether the application of this check against the outstanding debt of Pacific would prejudice the collection procedure.