B-181321, NOV 19, 1974

B-181321, NOV 19, 1974

AN EMPLOYEE INCURRED HOUSE SALE EXPENSES AT HIS OLD OFFICIAL STATION AFTER HIS TRANSFER WAS CANCELED ON THE ERRONEOUS ASSUMPTION THAT THE EXCLUSIVE LISTING AGREEMENT WITH REALTOR WAS IRREVOCABLE. CLAIM FOR REIMBURSEMENT OF EXPENSES MAY NOT BE ALLOWED SINCE UNDER APPLICABLE STATE LAW HE COULD HAVE UNILATERALLY CANCELED THE LISTING AGREEMENT AT ANY TIME WITHOUT INCURRING ANY EXPENSE.

WILLIAM E. JACKSON, JR. - CLAIM FOR HOUSE SALE EXPENSES AT OLD OFFICIAL STATION:

THIS MATTER INVOLVES A REQUEST FOR AN ADVANCE DECISION FROM THE FISCAL AGENT, EASTERN REGION, FOREST SERVICE, UNITED STATES DEPARTMENT OF AGRICULTURE, ON A CLAIM SUBMITTED BY MR. WILLIAM E. JACKSON, JR., AN EMPLOYEE OF THE FOREST SERVICE, FOR EXPENSES HE INCURRED IN CONNECTION WITH THE SALE OF HIS RESIDENCE IN MILWAUKEE, WISCONSIN.

THE RECORD SHOWS THAT MR. JACKSON, WHILE STATIONED IN MILWAUKEE, WISCONSIN, ACCEPTED AN OFFER BY HIS AGENCY ON JULY 5, 1973, TO TRANSFER TO BOISE, IDAHO. HE MADE ARRANGEMENTS TO PURCHASE A NEW RESIDENCE IN BOISE AND ON JULY 16, 1973, HE ENTERED INTO AN EXCLUSIVE LISTING CONTRACT WITH M.P. CASEY AND COMPANY, REALTORS, FOR THE SALE OF THE MILWAUKEE RESIDENCE. SHORTLY THEREAFTER HE WAS OFFERED A PROMOTION TO REMAIN AT HIS OLD OFFICIAL STATION IN MILWAUKEE, WISCONSIN. ON JULY 24, 1973, MR. JACKSON ACCEPTED THE OFFER AND HIS SCHEDULED TRANSFER TO BOISE WAS CANCELED. MR. JACKSON DID NOT REVOKE THE EXCLUSIVE LISTING AGREEMENT SINCE HE ASSUMED THAT HE COULD NOT DO SO WITHOUT PAYING THE STATED COMMISSION OF 6 PERCENT OF THE SALES PRICE UNLESS HE RECEIVED AN OFFER FROM A BUYER THROUGH THE BROKER THAT FAILED TO CONFORM TO THE TERMS OF THE AGREEMENT. ON AUGUST 4, 1973, THE REALTOR PRESENTED MR. JACKSON WITH A SALES CONTRACT THAT CONFORMED TO THE TERMS AND CONDITIONS OF THE LISTING AGREEMENT WHICH HE ACCEPTED. MR. JACKSON WENT TO SETTLEMENT ON AUGUST 23, 1973, AND HAS SUBMITTED A CLAIM FOR $2,574 FOR EXPENSES THAT HE INCURRED INCIDENT TO THE SALE OF HIS RESIDENCE. THE ADMINISTRATIVE AGENCY HAS REFUSED TO CERTIFY THE VOUCHER FOR PAYMENT SINCE THE SALE WAS MADE AFTER THE CANCELLATION OF MR. JACKSON'S TRANSFER AND THE REALTOR HAS ADVISED THAT THE LISTING AGREEMENT COULD HAVE BEEN CANCELED WITHOUT ANY COST TO MR. JACKSON PRIOR TO THE DATE OF THE SALE CONTRACT.

REIMBURSEMENT OF HOUSE SALE EXPENSES INCIDENT TO THE OFFICIAL TRANSFER OF AN EMPLOYEE ARE AUTHORIZED PURSUANT TO 5 U.S.C. 5724A (1970) WHICH PROVIDES AS FOLLOWS:

5724A. RELOCATION EXPENSES OF EMPLOYEES TRANSFERRED OR REEMPLOYED

"(A) UNDER SUCH REGULATIONS AS THE PRESIDENT MAY PRESCRIBE AND TO THE EXTENT CONSIDERED NECESSARY AND APPROPRIATE, AS PROVIDED THEREIN, APPROPRIATIONS OR OTHER FUNDS AVAILABLE TO AN AGENCY FOR ADMINISTRATIVE EXPENSES ARE AVAILABLE FOR THE REIMBURSEMENT OF ALL OR PART OF THE FOLLOWING EXPENSES OF AN EMPLOYEE FOR WHOM THE GOVERNMENT PAYS EXPENSES OF TRAVEL AND TRANSPORTATION UNDER SECTION 5724(A) OF THIS TITLE:

"(4) EXPENSES OF THE SALE OF THE RESIDENCE (OR THE SETTLEMENT OF AN UNEXPIRED LEASE) OF THE EMPLOYEE AT THE OLD STATION AND PURCHASE OF A HOME AT THE NEW OFFICIAL STATION REQUIRED TO BE PAID BY HIM WHEN THE OLD AND NEW OFFICIAL STATIONS ARE LOCATED WITHIN THE UNITED STATES, ITS TERRITORIES OR POSSESSIONS, THE COMMONWEALTH OF PUERTO RICO, OR THE CANAL ZONE. HOWEVER, REIMBURSEMENT FOR BROKERAGE FEES ON THE SALE OF THE RESIDENCE AND OTHER EXPENSES UNDER THIS PARAGRAPH MAY NOT EXCEED THOSE CUSTOMARILY CHARGED IN THE LOCALITY WHERE THE RESIDENCE IS LOCATED, AND REIMBURSEMENT MAY NOT BE MADE FOR LOSSES ON THE SALE OF THE RESIDENCE.

THIS STATUTE HAS BEEN IMPLEMENTED THROUGH THE PROMULGATION OF THE FEDERAL TRAVEL REGULATIONS (FPMR 101-7) (MAY 1973), WHICH SETS FORTH THE CONDITIONS UNDER WHICH SUCH EXPENSES ARE REIMBURSABLE. IN ADDITION, WHERE A TRANSFER OF OFFICIAL STATION HAS BEEN CANCELED AND CERTAIN EXPENSES WOULD HAVE BEEN REIMBURSABLE HAD THE TRANSFER BEEN COMPLETED, WE HAVE HELD THAT REAL ESTATE EXPENSES INCURRED BY AN EMPLOYEE PRIOR TO THE CANCELLATION OF HIS TRANSFER MAY BE REIMBURSED. B-174505, DECEMBER 21, 1971, AND B-177898, APRIL 16, 1973.

IN THE INSTANT CASE, MR. JACKSON INCURRED HIS HOUSE SALE EXPENSES AFTER CANCELLATION OF HIS TRANSFER AND, THEREFORE, WOULD NOT COME WITHIN THE PURVIEW OF THE DECISIONS CITED ABOVE. NEVERTHELESS, HE CONTENDS THAT HIS CLAIM SHOULD BE ALLOWED ON THE BASIS THAT, PRIOR TO CANCELLATION OF HIS TRANSFER, HE HAD ENTERED INTO AN EXCLUSIVE LISTING REAL ESTATE CONTRACT WITH THE REALTOR. HE FURTHER ARGUES THAT HE CONSIDERED HIMSELF BOUND BY THE LISTING CONTRACT TO EITHER ACCEPT A SALES CONTRACT THAT COMPLIED WITH THE TERMS AND CONDITIONS OF THE LISTING AGREEMENT OR TO PAY THE REALTOR'S COMMISSION UPON PREMATURE REVOCATION OF THE LISTING. IN THIS CONNECTION MR. JACKSON STATES THAT HE HAD BEEN ADVISED BY LEGAL COUNSEL IN HIS AGENCY'S MILWAUKEE OFFICE THAT HIS CONTRACT TO PURCHASE A HOUSE IN BOISE WAS VALID, THE BOISE "LISTING" CONTRACT WAS BINDING, AND THAT HE WOULD LOSE HIS DOWN PAYMENT ON THE BOISE RESIDENCE. ON THE BASIS OF THE ADVICE REGARDING THE BOISE RESIDENCE, MR. JACKSON ASSUMED HE WAS BOUND BY THE MILWAUKEE LISTING CONTRACT.

UNDER WISCONSIN LAW, AN OWNER, WHO HAS OBLIGATED HIMSELF TO PAY A COMMISSION FOR THE SALE OF HIS PROPERTY DURING THE CONTINUANCE OF THE AGENCY MAY IN GOOD FAITH WITHDRAW THE PROPERTY FROM THE MARKET AND THEREBY TERMINATE THE AGENCY ON PROPER NOTICE BEFORE ANYTHING IS DONE BY THE AGENT IN RELIANCE ON THE CONTRACT AND FOR THE PURPOSE OF PERFORMANCE THEREUNDER. LEVANDER V. JOHNSON, 193 N.W. 970 (WIS. 1923); SINDEN V. LAABS, 141 N.W. 2D 865 (WIS. 1966). APPARENTLY, THE REALTOR DID NOT CONSIDER HE HAD DONE ANYTHING IN RELIANCE ON THE CONTRACT IN VIEW OF HIS STATEMENT IN THE RECORD THAT HE WOULD HAVE RELEASED MR. JACKSON FROM HIS CONTRACT WITHOUT OBLIGATION, IF HE HAD REQUESTED HIM TO DO SO. IN VIEW OF THE ABOVE, MR. JACKSON COULD HAVE UNILATERALLY TERMINATED HIS LISTING AGREEMENT AT ANY TIME AFTER HIS TRANSFER WAS CANCELED ON JULY 24, 1973, BEFORE THE TIME HE WAS PRESENTED WITH AN OFFER ON AUGUST 4, 1973, WITHOUT INCURRING ANY EXPENSES. CONSEQUENTLY, THE GOVERNMENT WOULD NOT BE LIABLE FOR EXPENSES HE INCURRED THAT WERE UNNECESSARY AND WHICH RESULTED FROM HIS NOT BEING AWARE OF THE LEGAL CONSEQUENCES OF HIS AGREEMENT.

ACCORDINGLY, MR. JACKSON'S CLAIM FOR $2,574 IN HOUSE SALE EXPENSES MAY NOT BE CERTIFIED FOR PAYMENT.