B-151895, AUG. 9, 1963

B-151895: Aug 9, 1963

Additional Materials:

Contact:

Shirley Jones
(202) 512-8156
jonessa@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

SMITH: REFERENCE IS MADE TO YOUR LETTER DATED MAY 21. THE GREATER PORTION OF WHICH WAS WITHHELD FROM YOUR ARMY PAY FOR THE PURPOSE OF AN ALLOTMENT ON BEHALF OF YOUR WIFE. WHICH ALLOTMENT WAS NOT ESTABLISHED. WE HAVE ALSO RECEIVED YOUR LETTER OF MAY 21. YOUR CLAIM WAS DENIED FOR THE REASON THAT THE DEPARTMENT OF THE ARMY IN EFFECT ALLOWED YOU THIS AMOUNT WHEN IT APPLIED IT AGAINST YOUR INDEBTEDNESS TO THE UNITED STATES IN THE SUM OF $1. IN YOUR PRESENT LETTER YOU DO NOT QUESTION THE FACT THAT YOU ARE INDEBTED TO THE UNITED STATES. IT APPEARS TO BE YOUR VIEW THAT THE GOVERNMENT WAS WITHOUT AUTHORITY TO APPLY THE AMOUNT WITHHELD FROM YOUR PAY ACCOUNT TO YOUR INDEBTEDNESS AND THAT SUCH AMOUNT SHOULD BE PAID TO YOU DIRECTLY.

B-151895, AUG. 9, 1963

TO MR. WILLIE F. SMITH:

REFERENCE IS MADE TO YOUR LETTER DATED MAY 21, 1963, RELATIVE TO OUR OFFICE LETTER OF APRIL 30, 1963. IN THAT LETTER WE DENIED YOUR CLAIM FOR THE SUM OF $492.90, THE GREATER PORTION OF WHICH WAS WITHHELD FROM YOUR ARMY PAY FOR THE PURPOSE OF AN ALLOTMENT ON BEHALF OF YOUR WIFE, WHICH ALLOTMENT WAS NOT ESTABLISHED. WE HAVE ALSO RECEIVED YOUR LETTER OF MAY 21, 1963, ADDRESSED TO THE ALLOTMENT AND DEPOSITS OPERATIONS, FINANCE CENTER, U.S. ARMY, INDIANAPOLIS, INDIANA.

YOUR CLAIM WAS DENIED FOR THE REASON THAT THE DEPARTMENT OF THE ARMY IN EFFECT ALLOWED YOU THIS AMOUNT WHEN IT APPLIED IT AGAINST YOUR INDEBTEDNESS TO THE UNITED STATES IN THE SUM OF $1,867.64, AND REDUCED SUCH INDEBTEDNESS TO THE SUM OF $1,374.74. AS EXPLAINED IN OFFICE LETTER OF FEBRUARY 4, 1963, YOUR INDEBTEDNESS AROSE FROM ERRONEOUS CREDITS OF BASIC ALLOWANCE FOR QUARTERS DURING YOUR MILITARY SERVICE ON BEHALF OF INELIGIBLE DEPENDENTS. IN YOUR PRESENT LETTER YOU DO NOT QUESTION THE FACT THAT YOU ARE INDEBTED TO THE UNITED STATES. HOWEVER, IT APPEARS TO BE YOUR VIEW THAT THE GOVERNMENT WAS WITHOUT AUTHORITY TO APPLY THE AMOUNT WITHHELD FROM YOUR PAY ACCOUNT TO YOUR INDEBTEDNESS AND THAT SUCH AMOUNT SHOULD BE PAID TO YOU DIRECTLY.

THE RIGHT OF SETOFF HAS BEEN HELD TO BE INHERENT IN THE UNITED STATES AND TO BE GROUNDED IN THE COMMON-LAW RIGHT OF EVERY CREDITOR TO APPLY THE MONEYS OF HIS DEBTOR IN HIS HANDS TO THE EXTINGUISHMENT OF THE AMOUNTS DUE HIM FROM THE DEBTOR. GRATIOT V. UNITED STATES, 40 U.S. 336; MCKNIGHT V. UNITED STATES, 98 U.S. 178; CARRY V. UNITED STATES, 229 U.S. 47. THUS, WHERE A PERSON IS BOTH A DEBTOR AND CREDITOR TO THE GOVERNMENT IN ANY FORM, THE ACCOUNTING OFFICERS ARE REQUIRED BY LAW TO CONSIDER BOTH AND DEBITS AND CREDITS AND TO SET OFF ONE INDEBTEDNESS AGAINST THE OTHER, AND CERTIFY ONLY THE BALANCE. TAGGART V. UNITED STATES, 17 CT.CL. 322.

THE AMOUNT DUE YOU FROM THE GOVERNMENT HAVING BEEN APPLIED TO YOUR INDEBTEDNESS, THE ACTION TAKEN IN DECLINING TO AGAIN PAY YOU THAT AMOUNT WAS PROPER AND IS SUSTAINED.

THEREFORE, YOU ARE INDEBTED TO THE UNITED STATES IN THE AMOUNT OF $1,374.74, AND WE HAVE NO AUTHORITY TO WAIVE ANY PART OF THE INDEBTEDNESS. YOU SHOULD MAKE PAYMENT AS SOON AS POSSIBLE BY CHECK OR MONEY ORDERS PAYABLE TO THE "UNITED STATES GENERAL ACCOUNTING OFFICE" AND FORWARDED TO THE U.S. GENERAL ACCOUNTING OFFICE, POST OFFICE BOX 2610, WASHINGTON 13, D.C. WHEN MAKING REMITTANCE PLEASE REFER TO FILE Z2-042- 617. IF YOU PREFER YOU MAY ARRANGE TO PAY YOUR INDEBTEDNESS IN REASONABLE INSTALLMENTS.