B-115434-O.M. June 19, 1953

B-115434-O.M. June 19, 1953

The Controller General

Herewith is the file relative to the claim of the Department of Agriculture, Agricultural Research Administration, Bureau of Dairy Industry, in the amount of $247.80, representing the purported value of a bull loaned to the U.S. Public Health Services Hospital, Forth Worth, Texas.

In letter dated January 21, 1953, the Bureau of Dairy Industry reports that under an agreement, dated July 31, 1942, the bull was loaned to the Hospital for breeding purposes, said agreement containing a provision for the return of the bull in a as good condition as it was at the time it passed into the Hospital's custody. It is further reported that in June, 1948, the animal became vicious and considered to be no longer useful for breeding purposes and, accordingly, the Hospital had the animal slaughtered and used for edible purposes, it appearing that the Hospital authorities were unaware at that time that the bull was loaned by the Bureau. Said authorities have established the animal's value as beef at $247.80.

In declining to make reimbursement, the Hospital is reported to have expressed its opinion that this situation is parallel to the purchase of surplus property from one agency by another and Section Regulation 3 would be operative. In its interpretation of that section the Hospital takes the position that the animal would be considered as scrap and of no value except for its basic material content and inasmuch as it was scrap it could be transferred from one agency to another without cost. An administrative report from the Public Health Service, giving that agency's version of the transaction is not before this Office.

The Bureau of Dairy Industry relies upon 30 Comp. Gen. 295 in support of its position that reimbursement is mandatory. While this decision may be applicable to cases of this type, question arises whether any transfer of funds is required since the subject matter of the transfer has been destroyed.

In view thereof and the request of the Bureau of Dairy Industry with respect to the disposition of its open account the matter is submitted for your consideration and instructions.

W. S. BENJAMIN Assistant Chief, Claims Division

Enclosures

Chief, Claims Division

Returned. The bull was loaned and slaughtered long before passage of the Federal Property and Administrative Services Act of 1949 and regulations under that act would not appear to be controlling as to the instant matter. Also, the bull had not been determined to be "excess property" within Section 3(e) of the act, if the act were otherwise applicable.

The bull was loaned pursuant to the agreement to restore it in good condition and its slaughter and use for food by the borrowing agency was in violation of the bailment agreement making the appropriation of that agency liable for its agreed value. 30 Comp. Gen. 295. Accordingly, the claim should be forwarded tot he Public Health Service for report and citation to the appropriation for the purchase of food at the time contract was made.

Upon receipt of such report, the claim may be allowed from such appropriation or if lapsed, from "Payment of Certified Claims" provided a sufficient balance was deposited to that fund from the original appropriation. If the original appropriation is lapsed and an insufficient amount was covered into "Payment of Certified Claims" therefrom, to permit payment of the amount from "Payment of Certified Claims," the claimant department may be advised that since no funds are available for payment of the claim and its appears no useful purpose would be served by the Congress appropriating funds from the Treasury for its payment so that the amount appropriated might be returned to the Treasury (Miscellaneous Receipts), no action in the matter appears to be warranted but it may be considered closed and the Department's records noted to show the claim as having be so adjusted. See B-95311-O.M., July 17, 1950, and B-84325-O.M., February 3, 1950.

LINDSAY C. WARREN Comptroller General of the United States

Enclosure