Claim for Retroactive Payment of Living Quarters Allowance

A civilian employee of the Department of the Army made a claim for retroactive payment of the rental portion of his living quarters allowance. The employee had obtained a licensing agreement for the construction of a portable house for self-occupancy in accordance with the prevailing command policy on family housing at that time. This policy authorized an annual rental allowance equivalent to 10 percent of the cost of construction of the house with no time limitation on the receipt of the allowance. Subsequently, the employee received an official notice which terminated this rental portion of his living quarters allowance. The employee contended that the Government was estopped from adjusting his living quarters allowance, since his entitlement to the allowance was vested under the existing regulations at the time he constructed the house. Since the relationship between the Government and the employee was appointive and not contractual, the doctrine of equitable estoppel did not apply. In addition, since the employee had entered into a licensing agreement and not a contract, the agreement was permissive, unassignable, and subject to cancellation at any time. Further, in modifying the employee's living quarters allowance, the Army was enforcing a clear requirement founded in recently enacted regulations. Accordingly, the claim was denied.