B-127494, FEB. 10, 1961

B-127494, FEB. 10, 1961

TO MR. HARVEY BURSTEIN:

YOUR LETTER OF DECEMBER 31, 1960, REQUESTS FURTHER CONSIDERATION OF YOUR INDEBTEDNESS TO THE UNITED STATES FOR $1,047.34 REPRESENTING OVERPAYMENT OF SALARY DURING THE PERIOD FROM OCTOBER 7, 1953, TO FEBRUARY 19, 1954, RESULTING FROM YOUR ACCEPTANCE OF AN APPOINTMENT TO A GRADE GS-14 POSITION ON OCTOBER 7, 1953, IN CONTRAVENTION OF THE WHITTEN RIDER, SECTION 1310 (C) OF THE ACT OF NOVEMBER 1, 1951, AS AMENDED, 5 U.S.C. 43 (C).

THE RECORD INDICATES THAT ON AUGUST 14, 1953, YOU RESIGNED FROM A GRADE GS-11 POSITION (AT $6,140 PER ANNUM) WITH THE FEDERAL BUREAU OF INVESTIGATION, DEPARTMENT OF JUSTICE, AND THAT ON OCTOBER 7, 1953, YOU WERE APPOINTED TO A GRADE GS-14 POSITION (AT $9,600 PER ANNUM) WITH THE DEPARTMENT OF STATE. IT FURTHER INDICATES THAT YOUR APPOINTMENT OF OCTOBER 7, 1953, WAS A TEMPORARY-EMERGENCY APPOINTMENT AS INVESTIGATOR AT THE GS-14 LEVEL, AND THAT ON NOVEMBER 7, 1953, YOU WERE GIVEN AN APPOINTMENT BY THE DEPARTMENT OF STATE, AS CHIEF SPECIAL CANDIDATES STAFF, UNDER A SCHEDULE C AUTHORITY. ABOUT TEN DAYS LATER, THE STATE DEPARTMENT REQUESTED THE CIVIL SERVICE COMMISSION TO APPROVE THE EXTENSION OF YOUR APPOINTMENT FOR SIXTY DAYS. THE REQUEST STATED THAT YOU WERE A GRADE GS- 14 INVESTIGATOR BUT OMITTED INFORMATION TO THE EFFECT THAT THE WHITTEN RIDER WAS INVOLVED. ON DECEMBER 12, 1953, YOUR APPOINTMENT AS CHIEF, SPECIAL CANDIDATES STAFF, GS-14, WAS EXTENDED AND THE CIVIL SERVICE COMMISSION WAS ASKED FOR AUTHORITY FOR ANOTHER SIXTY-DAY EXTENSION. JANUARY 1954, YOUR APPOINTMENT WAS EXTENDED, AND THE RECORDS SHOW THAT YOU WERE AGAIN ASSIGNED TO THE GS 14 INVESTIGATOR POSITION. THE MATTER WAS DIRECTED TO OUR ATTENTION BY LETTER OF APRIL 4, 1956, FROM THE CIVIL SERVICE COMMISSION AFTER A POST AUDIT HAD BEEN MADE AND SUBSEQUENTLY OUR OFFICE STATED EXCEPTIONS AGAINST THE SALARY PAYMENTS AT THE GRADE GS-14 RATE. ON OCTOBER 30, 1957, AFTER THE STATE DEPARTMENT HAD EXHAUSTED ALL ADMINISTRATIVE POSSIBILITIES OF ABSOLVING THE INDEBTEDNESS, THE DEPARTMENT REQUESTED YOU TO REFUND THE ABOVE-STATED AMOUNT WHICH YOU HAD RECEIVED AS OVERPAYMENT OF SALARY FOR THE PERIOD INVOLVED. YOUR COMMUNICATIONS TO THE STATE DEPARTMENT DATED NOVEMBER 14 AND DECEMBER 14, 1957, AND JANUARY 4, 1958, IN RESPONSE TO THE DEPARTMENT'S LETTER OF OCTOBER 30, NOVEMBER 27, AND DECEMBER 20, 1957, AS WELL AS YOUR LETTER OF DECEMBER 30, 1960, TO OUR OFFICE, DENY LIABILITY ON YOUR PART. HOWEVER, YOU OFFER NOTHING OF EVIDENTIARY VALUE SUFFICIENT TO AVOID THE PROHIBITION CONTAINED IN THE WHITTEN RIDER.

THE WHITTEN RIDER, SECTION 1310/C) OF THE ACT OF NOVEMBER 1, 1951, 65 STAT. 758, AS AMENDED BY SECTION 1302 OF THE ACT OF JUNE 5, 1952, 66 STAT. 122, 5 U.S.C. 43/C), PROVIDES IN PERTINENT PART AS FOLLOWS:

"* * * NO PERSON IN ANY EXECUTIVE DEPARTMENT OR AGENCY WHOSE POSITION IS SUBJECT TO THE CLASSIFICATION ACT OF 1949, AS AMENDED, SHALL BE PROMOTED OR TRANSFERRED TO A HIGHER GRADE SUBJECT TO SUCH ACT WITHOUT HAVING SERVED AT LEAST ONE YEAR IN THE NEXT LOWER GRADE: PROVIDED, THAT THE CIVIL SERVICE COMMISSION FOR POSITIONS IN THE COMPETITIVE SERVICE AND THE HEAD OF THE EMPLOYING AGENCY FOR POSITIONS OUTSIDE THE COMPETITIVE SERVICE MAY BY REGULATION PROVIDE FOR PROMOTIONS OF TWO GRADES IN ONE YEAR (1) TO POSITIONS NOT HIGHER THAN GS-5; (2) TO POSITIONS NOT HIGHER THAN GS-11 WHICH ARE IN A LINE OF WORK PROPERLY CLASSIFIED UNDER THE CLASSIFICATION ACT OF 1949 AT TWO GRADE INTERVALS; * * * PROVIDED FURTHER, THAT THIS SUBSECTION SHALL NOT APPLY TO ANY CASE INVOLVING AN EMPLOYEE WHO IS WITHIN REACH FOR APPOINTMENT TO A HIGHER GRADE POSITION ON A COMPETITIVE CIVIL SERVICE REGISTER OR IS ELIGIBLE FOR APPOINTMENT, IN ACCORDANCE WITH A REGULAR APPOINTMENT SYSTEM OR PROCEDURE ESTABLISHED PRIOR TO SEPTEMBER 1, 1950, TO A HIGHER GRADE POSITION OUTSIDE THE COMPETITIVE CIVIL SERVICE, OR BEING ADVANCED UP TO A GRADE LEVEL FROM WHICH HE HAD BEEN DEMOTED OR SEPARATED BECAUSE OF REDUCTION IN FORCE, OR BEING ADVANCED TO A GRADE LEVEL NOT EXCEEDING THAT FOR WHICH HE HAD PREVIOUSLY ESTABLISHED ELIGIBILITY AS REQUIRED BY THE TERMS HEREOF: PROVIDED FURTHER, THAT, NOTWITHSTANDING THE PROVISIONS HEREOF, AND IN ORDER TO AVOID UNDUE HARDSHIP OR INEQUITY, THE CIVIL SERVICE COMMISSION, WHEN REQUESTED BY THE HEAD OF THE AGENCY INVOLVED, MAY AUTHORIZE PROMOTIONS IN INDIVIDUAL CASES OF MERITORIOUS NATURE.'

IN YOUR LETTER OF JANUARY 4, 1958, TO THE STATE DEPARTMENT YOU SAY,"A VERY CAREFUL AND THOROUGH REVIEW OF BOTH 63 STAT. 954 (P.L. 429) AND 65 STAT. 736 (P.L. 253) FAILS TO REFLECT ANY STATEMENT WHATSOEVER ABOUT A FORMER EMPLOYEE, UNDER CIRCUMSTANCES SUCH AS WE HAVE HERE, BEING HELD LIABLE.'

THE LATTER STATUTE CITED BY YOU, I.E. 65 STAT. 736, IS THE SUPPLEMENTAL APPROPRIATIONS ACT OF 1952, ENACTED NOVEMBER 1, 1951. SECTION 1310/C) OF THAT ACT, OTHERWISE KNOWN AS THE WHITTEN RIDER AND WHICH IS QUOTED ABOVE, CONTAINS THE SPECIFIC PROHIBITION UPON WHICH YOUR LIABILITY FOR REFUND IS PREDICATED. THE OTHER STATUTE CITED BY YOU, I.E. 63 STAT. 954, IS KNOWN AS THE CLASSIFICATION ACT OF 1949. YOU REPEATEDLY SAY THAT YOU ARE EXEMPT FROM THE PROVISIONS OF THIS ACT, WHICH IN TURN WOULD EXEMPT YOU FROM THE PROVISIONS OF THE WHITTEN RIDER. A CHECK OF THE EXEMPTIONS TO THE CLASSIFICATION ACT OF 1949, CONTAINED IN SECTION 202 THEREOF DOES NOT ESTABLISH YOUR ALLEGED EXEMPTION. FURTHERMORE, SECTION 213 OF THE ACT AUTHORIZES THE CIVIL SERVICE COMMISSION TO DETERMINE THE APPLICABILITY OF SECTION 202 TO SPECIFIC POSITIONS, OFFICERS, AND EMPLOYEES. THERE IS NO EVIDENCE IN THE RECORD THAT THE COMMISSION MADE ANY DETERMINATION OF EXEMPTION IN YOUR CASE. THEREFORE, IT CLEARLY APPEARS THAT YOUR CASE FALLS WITHIN THE COVERAGE OF THE ACT AS OUTLINED IN SECTION 201 THEREOF.

ALTHOUGH OUR OFFICE HAS HELD THAT WHEN APPOINTMENTS WERE MADE IN GOOD FAITH BOTH ON THE PART OF THE EMPLOYEE AND THE ADMINISTRATIVE OFFICE THE EMPLOYEE INVOLVED MAY BE CONSIDERED AS HAVING SERVED IN A DE FACTO STATUS AND AS SUCH IS ENTITLED TO RETAIN COMPENSATION RECEIVED PRIOR TO THE TIME THE ERROR WAS DIRECTED TO THE ATTENTION OF THE ADMINISTRATIVE OFFICIALS (28 COMP. GEN. 514). SUCH CASES ARE, HOWEVER, CLEARLY DISTINGUISHABLE FROM THOSE WHEN THE SALARY OF A HIGHER GRADE IS PAID TO AN EMPLOYEE CONTRARY TO A SPECIFIC STATUTORY PROVISION PRESCRIBING A MINIMUM PERIOD OF SERVICE IN GRADE AS A REQUISITE FOR ADVANCEMENT TO A HIGHER GRADE SUCH AS THE INSTANT SITUATION. SEE 36 COMP. GEN. 230. THE DE FACTO RULE MAY NOT BE INVOKED TO NULLIFY THE EFFECT OF A STATUTORY REQUIREMENT. SEE 18 COMP. GEN. 815; 29 ID. 75.

WHILE WE UNDERSTAND YOUR FEELINGS IN THE MATTER, YOUR APPOINTMENT TO THE GRADE GS-14 POSITION WAS IN CONTRAVENTION OF A PROHIBITION CONTAINED IN A PUBLIC LAW OF WHICH ALL PERSONS ARE PRESUMED TO HAVE KNOWLEDGE. OUR OFFICE HAS NO AUTHORITY TO GRANT RELIEF IN SUCH CASES, NOTWITHSTANDING THE FACT THAT AN EMPLOYEE WAS WITHOUT FAULT IN THE MATTER. SEE 33 COMP. GEN. 541.

YOU SAY THAT IN VIEW OF THE PERIOD THAT HAS ELAPSED SINCE THE OVERPAYMENTS WERE MADE YOU FEEL THAT COLLECTION ACTION AGAINST YOU WOULD BE BARRED BY A STATUTE OF LIMITATIONS. YOU CITE SPECIFICALLY 31 U.S.C. 122 AND 18 U.S.C. 3282. THE FORMER ACT BARS CLAIMS ON CHECKS OR WARRANTS WHICH HAVE NOT BEEN PRESENTED HERE OR TO THE TREASURER OF THE UNITED STATES BY THE CLAIMANTS WITHIN SIX YEARS AFTER THE DATE OF ISSUANCE OF THE CHECKS OR WARRANTS, IN THOSE INSTANCES WHEN IT APPEARS THAT THE CHECKS OR WARRANTS HAVE BEEN PAID. THIS STATUTE IMPOSES A LIMITATION ON THE TIME DURING WHICH SUCH CLAIMS MAY BE ASSERTED AGAINST THE UNITED STATES RATHER THAN BY THE UNITED STATES AGAINST OTHERS. THE LATTER STATUTE CITED BY YOU, 18 U.S.C. 3282 RELATES TO THE PROSECUTION OF PENAL OFFENSES AND HAS NO RELATIONSHIP TO CIVIL LIABILITY. THE INSTANT MATTER DOES NOT COME WITHIN THE PURVIEW OF EITHER OF THE U.S.C. PROVISIONS CITED BY YOU.

REGARDING THE POSSIBLE USE OF A STATUTE OF LIMITATIONS AS A DEFENSE AGAINST THE GOVERNMENT'S CLAIM, YOU ARE ADVISED THAT THE UNITED STATES IS NOT BOUND BY STATUTES OF LIMITATIONS UNLESS CONGRESSIONAL ACTION CLEARLY MANIFESTS ITS INTENTION TO MAKE SUCH STATUTE APPLICABLE TO THE UNITED STATES. IN MISSOURI-KANSAS-TEXAS RAILROAD COMPANY, V. UNITED STATES, 62 CT. CL. 373, THE COURT SAID (PAGE 377):

"* * * UNQUESTIONABLY THE RULE IS THAT IT REQUIRES CONGRESSIONAL ACTION CLEARLY MANIFESTING SUCH A PURPOSE BEFORE THE UNITED STATES CAN BE BOUND BY STATUTES OF LIMITATIONS. SEE UNITED STATES V. NASHVILLE RY CO., 118 U.S. 120, 125.

"IT IS SAID THAT "NO LACHES CAN BE IMPUTED TO THE GOVERNMENT, AND AGAINST IT NO TIME RUNS SO AS TO BAR ITS RIGHTS.' SEE THOMPSON CASE, 98 U.S. 486, 488.'

IN UNITED STATES V. AMERICAN BELL TELEPHONE COMPANY, 159 U.S. 548, 554, IT WAS STATED:

"IT IS UPON THE PRINCIPLE OF GOVERNMENT POLICY THAT THE UNITED STATES HAS BEEN HELD NOT BOUND BY STATUTES OF LIMITATIONS UNLESS CONGRESS HAS CLEARLY MANIFESTED THAT THEY SHOULD BE SO BOUND.'

SEE ALSO, THE CASES OF UNITED STATES V. BEEBE, 127 U.S. 338; UNITED STATES V. WHITED AND WHELESS, LTD., 246 U.S. 552; GUARANTY TRUST COMPANY V. UNITED STATES, 304 U.S. 126 AND CASES CITED THEREIN; AND DUPONT DE NEMOURS AND CO. V. DAVIS, ETC., 264 U.S. 456.

IN VIEW OF THE ABOVE CONSIDERATIONS IT IS EVIDENT THAT, AT THE TIME OF YOUR APPOINTMENT ON OCTOBER 7, 1953, TO THE STATE DEPARTMENT, YOU WERE ENTITLED TO RECEIVE A SALARY NOT IN EXCESS OF THE ENTRANCE RATE OF GRADE GS-12 OR $7,040 PER ANNUM AND REFUND OF THE EXCESS AMOUNT OF $1,047.34 MUST BE ACCOMPLISHED.

PAYMENT OF THE AMOUNT OF THE INDEBTEDNESS, STATED ABOVE, SHOULD BE MADE BY CHECK, DRAFT, OR MONEY ORDER MADE PAYABLE TO THE TREASURER OF THE UNITED STATES AND SENT TO THE CLAIMS DIVISION, U.S. GENERAL ACCOUNTING OFFICE, WASHINGTON 25, D.C.

REGARDING YOUR QUESTION CONCERNING THE POSSIBILITY OF A REFUND OF OVERPAYMENT OF TAXES PAID BY YOU DURING THE INVOLVED PERIOD RESULTING FROM THE ILLEGAL SALARY PAYMENTS, WE DIRECT YOUR ATTENTION GENERALLY TO THE BUREAU OF INTERNAL REVENUE'S "CLAIMS OF RIGHT" DOCTRINE. INTERPRETATION OF THAT DOCTRINE WHICH MIGHT HAVE SOME BEARING IS CONTAINED IN REVENUE RULING 57-603, INTERNAL REVENUE BULLETIN 1957-51 P. 55, AND THE CASE OF UNITED STATES V. LEWIS, 340 U.S. 590, CITED THEREIN. SINCE OUR OFFICE LACKS JURISDICTION OVER INCOME TAX MATTERS ANY FURTHER QUESTIONS YOU MAY HAVE CONCERNING THE TAX ASPECTS OF YOUR CASE SHOULD BE DIRECTED TO THE DISTRICT DIRECTOR OF INTERNAL REVENUE NEAREST YOUR PLACE OF BUSINESS OR RESIDENCE.