B-146417, OCT. 5, 1961

B-146417, OCT. 5, 1961

TO MRS. MARY HELEN SIMPSON:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 12, 1961, REQUESTING A REVIEW OF YOUR INDEBTEDNESS TO THE UNITED STATES IN THE AMOUNT OF $1,260 ON ACCOUNT OF ERRONEOUS CLASS E ALLOTMENT PAYMENTS MADE BY THE DEPARTMENT OF THE ARMY DURING THE PERIOD MARCH 1, 1947, TO AUGUST 31, 1948.

IT APPEARS THAT ON APRIL 4, 1946, YOUR HUSBAND, LAVELLE E. SIMPSON, WHILE SERVING IN THE ARMY AND THEN HAVING IN EFFECT A FAMILY ALLOWANCE IN YOUR FAVOR, APPLIED FOR AN INCREASE IN HIS CLASS E (VOLUNTARY) ALLOTMENT TO YOU FROM $40 TO $70 PER MONTH. IT IS REPORTED THAT HE REQUESTED THAT SUCH VOLUNTARY ALLOTMENT BE DISCONTINUED EFFECTIVE FEBRUARY 28, 1947, AND THAT THEREAFTER UNTIL HIS DISCHARGE FROM THE ARMY ON AUGUST 26, 1948, NO DEDUCTIONS ON THAT ACCOUNT WERE MADE FROM HIS MILITARY PAY. THE NOTICE OF DISCONTINUANCE OF THE ALLOTMENTS WAS NOT RECEIVED IN THE ALLOTMENT OFFICE, HOWEVER, AND CONSEQUENTLY THE ARMY CONTINUED MAILING TO YOU THE REGULAR MONTHLY ALLOTMENT CHECKS OF $70 EACH FROM MARCH 1, 1947, TO AUGUST 31, 1948. AS A RESULT ALLOTMENT PAYMENTS TOTALING $1,260 WERE MADE TO WHICH YOU WERE NOT ENTITLED.

THE DEPARTMENT OF THE ARMY ENDEAVORED TO COLLECT THE INDEBTEDNESS AND WHEN THEIR EFFORTS WERE OF NO AVAIL, THEY REFERRED THE MATTER TO THIS OFFICE ON APRIL 2, 1951, FOR FURTHER APPROPRIATE COLLECTION PROCEEDINGS. ON MAY 16, 1951, THIS OFFICE ADDRESSED LETTERS TO YOUR HUSBAND AND YOU FURNISHING AN EXPLANATION OF THE ERRONEOUS PAYMENTS AND REQUESTING REMITTANCE OF THE AMOUNT INVOLVED. NEITHER YOUR HUSBAND NOR YOU RESPONDED TO SUCH LETTERS. THEREAFTER, A DETERMINATION WAS MADE BY THIS OFFICE THAT YOU WERE SOLELY LIABLE FOR THE REPAYMENT OF THE INDEBTEDNESS UNDER OUR HOLDING IN 33 COMP. GEN. 309. COLLECTION LETTERS WERE ADDRESSED BY THIS OFFICE TO YOU ON MAY 23 AND SEPTEMBER 19, 1957, AND JANUARY 27, 1958, AND IN RESPONSE TO THE LAST LETTER YOU ADVISED BY YOUR LETTER OF FEBRUARY 4, 1958, THAT YOU DID NOT INDORSE THE CHECKS COVERING THE ALLOTMENT PAYMENTS AND THAT, NOTWITHSTANDING YOUR EMPLOYMENT WITH THE DEPARTMENT OF AGRICULTURE, YOU WERE IN NO FINANCIAL POSITION TO MAKE REPAYMENT.

BY OFFICE LETTER OF FEBRUARY 12, 1958, YOU WERE INFORMED THAT THIS OFFICE HAD NO ALTERNATIVE BUT TO EFFECT COLLECTION FROM YOU AND THAT, IF REMITTANCE WAS NOT RECEIVED, THE MATTER WOULD BE REFERRED TO THE DEPARTMENT OF AGRICULTURE, WHERE YOU THEN WERE EMPLOYED, FOR NECESSARY ACTION. SUBSEQUENTLY, IT WAS ASCERTAINED THAT YOU RESIGNED FROM YOUR POSITION WITH THE DEPARTMENT OF AGRICULTURE AND OBTAINED EMPLOYMENT WITH AN INSTALLATION UNDER THE DEPARTMENT OF THE ARMY. ACCORDINGLY, THIS OFFICE REPORTED YOUR INDEBTEDNESS TO THE DEPARTMENT OF THE ARMY ON DECEMBER 23, 1958, FOR COLLECTION ACTION UNDER THE PROVISIONS OF THE ACT OF JULY 15, 1954, 68 STAT. 482, 5 U.S.C. 46D.

IN SUPPORT OF YOUR REQUEST FOR A REVIEW OF THE INDEBTEDNESS YOU HAVE STATED IN YOUR LETTER OF JUNE 12, 1961, THAT AT THE TIME THE CHECKS COVERING THE SUBJECT ALLOTMENT PAYMENTS WERE MAILED BY THE ARMY YOU WERE IN EUROPE AND THAT YOU NEVER CASHED SUCH CHECKS. IN THIS CONNECTION, YOU HAVE FURNISHED INFORMATION TO THE EFFECT THAT YOU WROTE TO THE TREASURY DEPARTMENT TO ASCERTAIN WHO INDORSED THE CHECKS, BUT THAT THEY NOTIFIED YOU THAT THE INDORSERS CANNOT BE DETERMINED SINCE THE CHECKS HAVE BEEN DESTROYED. YOU HAVE ALSO REQUESTED A WAIVER OF THE INDEBTEDNESS IN VIEW OF YOUR PRESENT FINANCIAL CONDITION.

IN ORDER TO EVALUATE YOUR STATEMENT IN THE LIGHT OF AVAILABLE EVIDENCE, WE OBTAINED FROM THE DEPARTMENT OF THE ARMY THE RECORD PERTAINING TO YOUR HUSBAND'S CLASS E ALLOTMENT ACCOUNT. IT IS SHOWN BY THE PAPERS THEREIN THAT EFFECTIVE APRIL 1946 YOUR HUSBAND'S CLASS E ALLOTMENT TO YOU OF $40 PER MONTH WAS INCREASED TO $70 PER MONTH AND THAT ON AUGUST 31, 1948, PAYMENT OF SUCH ALLOTMENT WAS DISCONTINUED BY REASON OF HIS DISCHARGE. COMPLETE DESCRIPTION OF THE CHECKS WHICH WERE DRAWN DURING THE PERIOD MARCH 1, 1947, TO AUGUST 31, 1948, TO THE ORDER OF MRS. MARY H. SIMPSON AND MAILED TO THE ADDRESS FURNISHED BY YOUR HUSBAND, ROUTE 2, EUDORA, ARKANSAS, IS OF RECORD AND A CHECK STATUS REPORT SHOWS THAT SUCH CHECKS WERE NEGOTIATED IN DUE COURSE, PAID BY THE TREASURER OF THE UNITED STATES, AND DESTROYED PURSUANT TO LAW.

IT IS NOTED THAT, NOTWITHSTANDING THE FACT THAT BOTH YOUR HUSBAND AND YOU WERE INFORMED IN 1950 AND 1951 OF THE ERRONEOUS PAYMENTS AND OF YOUR OBLIGATION TO MAKE REPAYMENT, IT WAS NOT UNTIL FEBRUARY 4, 1958, THAT YOU FIRST ALLEGED THAT YOU DID NOT RECEIVE NOR INDORSE THE CHECKS. PERTINENT, TOO, IS LETTER DATED OCTOBER 30, 1950, ADDRESSED TO THE DEPARTMENT OF THE ARMY, ARMY FINANCE CENTER, ST. LOUIS 20, MISSOURI, OVER THE NAME OF LAVELLE E. SIMPSON, WHICH APPEARS TO BE IN YOUR HANDWRITING. THAT LETTER READS AS FOLLOWS:

"IN ANSWER TO YOUR RECENT CORRESPONDENCE CONCERNING MY INDEBTEDNESS TO THE U.S. GOVERNMENT, THIS IS TO ADVISE THAT I WAS IGNORANT OF THE FACT THAT AN OVER-PAYMENT OCCURRED. I SENT MY WIFE, MRS. MARY HELEN SIMPSON A CLASS E ALLOTMENT, PLUS AN ADDITIONAL $75.00 EACH MONTH, PRIOR TO HER ARRIVAL IN GERMANY, WHICH WAS IN JANUARY, 1947. IN FEBRUARY, 1947 I REQUESTED THAT THIS ADDITIONAL $75.00 ALLOTMENT BE CANCELED, INASMUCH AS MY FAMILY WERE OVERSEAS, AND THE MONEY WAS NEEDED THERE. I WAS SO ADVISED IN THE PERSONNEL SECTION BY THE SGT. MAJOR IN CHARGE THAT THIS WOULD BE DONE, THAT NO FURTHER ACTION ON MY PART WAS NECESSARY AS THEY WOULD FURTHER PROCESS MY AFFAIRS. THIS WAS ENTERED ON MY SERVICE RECORD AND SIGNED BY THE PERSONNEL OFFICER, WHO WAS CAPT. WILLIAMS, I BELIEVE. UPON DEPARTURE FROM THE STATES, MY WIFE ARRANGED FOR THE FAMILY TO DEPOSIT ALL CHECKS THAT ARRIVED DURING HER ABSENCE. MANY TRANSACTIONS OCCURRED DURING THIS PERIOD AND IT NEVER CAME TO MY ATTENTION THAT WE WERE BEING OVERPAID INASMUCH AS WE NEVER RECEIVED BANK STATEMENTS DURING THIS PERIOD OF TIME. MY WIFE RETURNED TO THE STATES IN JUNE OF 1948, AND SHE NEVER MENTIONED RECEIVING ANY SUCH PAYMENTS, HOWEVER, SHE WASN-T AWARE OF THE PROCEDURE, AND WOULDN T HAVE THOUGHT ABOUT IT ANYWAY. ACTUALLY I NEVER SAW, OR WAS AWARE OF SUCH CHECKS BEING ISSUED AS I WAS NOT HERE. I RETURNED FROM EUROPE IN AUGUST 1948 AFTER BEING DISCHARGED.

"I ONLY KNOW THAT I-M IN NO POSITION TO REPAY ANY SUCH DEBT, HOWEVER, IF I CAN BE OF ANY ASSISTANCE OTHER THAN THAT, KINDLY LET ME KNOW.'

IT WILL BE OBSERVED THAT NO MENTION WAS MADE IN THAT LETTER OF THE NONRECEIPT OR NONNEGOTIATION OF THE CHECKS BY YOU, NOR DID YOU ADVISE THIS OFFICE IN RESPONSE TO THE INITIAL COLLECTION LETTER OF MAY 16, 1951, THAT THE CHECKS WERE NEVER INDORSED BY YOU. IT FURTHER APPEARS FROM THE PAPERS ON FILE THAT YOU RETURNED TO EUDORA SOMETIME IN MAY 1948 AND LIVED THERE ON THE DATES THE CHECKS FOR MAY, JUNE, JULY AND AUGUST 1948 WERE DUE TO ARRIVE. IN VIEW OF ALL THE FACTS AND CIRCUMSTANCES IN THIS CASE, WE MAY ONLY CONCLUDE THAT THE CHECKS WERE NEGOTIATED WITH YOUR AUTHORIZATION AND THAT YOU DERIVED THE BENEFITS FROM THEIR PROCEEDS.

IT IS WELL ESTABLISHED THAT PERSONS WHO RECEIVE MONEY ERRONEOUSLY PAID BY A GOVERNMENT AGENCY OR OFFICIAL ACQUIRE NO RIGHT TO SUCH MONEY AND THE COURTS CONSISTENTLY HAVE HELD THAT SUCH PERSONS ARE BOUND IN EQUITY AND GOOD CONSCIENCE TO MAKE RESTITUTION. SEE BARNES, ET AL. V. DISTRICT OF COLUMBIA, 22 CT.CL. 366. IN THE CASE OF UNITED STATES V. BENTLEY, 107 F.2D 382, IT WAS HELD THAT PAYMENTS MADE THROUGH MISTAKES OF OFFICERS OF THE UNITED STATES ARE RECOVERABLE AND THAT THE SUPPOSED HARDSHIP OF REFUNDING WHAT THE RECIPIENT MAY HAVE SPENT CANNOT STAND AGAINST THE INJUSTICE OF KEEPING WHAT NEVER RIGHTFULLY BELONGED TO HIM. SEE ALSO THE CASE OF UNITED STATES V. TEEHAN, 140 F.SUPP. 465, WHEREIN IT WAS HELD THAT THE GOVERNMENT'S RIGHT TO RECOVER AN OVERPAYMENT OF ALLOTMENT TO THE DEFENDANT WAS NOT AFFECTED BY THE FACT THAT THE PAID CHECKS COVERING THE OVERPAYMENT WERE UNAVAILABLE BECAUSE OF THEIR DESTRUCTION PURSUANT TO LAW.

THERE IS NO QUESTION CONCERNING THE OBLIGATION OF THE RECIPIENT OF ERRONEOUS PAYMENTS TO MAKE REPAYMENT IN FULL. WE HAVE NO AUTHORITY TO WAIVE OR CANCEL YOUR INDEBTEDNESS AND WE WERE REQUIRED TO REPORT THE INDEBTEDNESS TO THE GOVERNMENT DEPARTMENT IN WHICH YOU ARE NOW EMPLOYED, THE DEPARTMENT OF THE ARMY.

WE ASSUME THAT THE DEPARTMENT OF THE ARMY WILL TAKE THE NECESSARY STEPS TO COLLECT YOUR INDEBTEDNESS UNDER THE AUTHORITY OF THE ACT OF JULY 15, 1954, WHICH, IN PERTINENT PART, PROVIDES AS FOLLOWS:

"* * * THAT, WHEN IT IS DETERMINED BY THE SECRETARY OF THE DEPARTMENT CONCERNED OR THE HEAD OF THE AGENCY OR INDEPENDENT ESTABLISHMENT CONCERNED, OR ONE OF THEIR DESIGNEES, THAT AN EMPLOYEE OF THE UNITED STATES OR ANY MEMBER OF THE ARMY, NAVY, AIR FORCE, MARINE CORPS, OR COAST GUARD, OR A RESERVE COMPONENT THEREOF, IS INDEBTED TO THE UNITED STATES AS THE RESULT OF ANY ERRONEOUS PAYMENT MADE BY THE DEPARTMENT, AGENCY, OR INDEPENDENT ESTABLISHMENT CONCERNED TO ON BEHALF OF ANY SUCH PERSON, THE AMOUNT OF THE INDEBTEDNESS MAY BE COLLECTED IN MONTHLY INSTALLMENTS, OR AT OFFICIALLY ESTABLISHED REGULAR PAY PERIOD INTERVALS, BY DEDUCTION IN REASONABLE AMOUNTS FROM THE CURRENT PAY ACCOUNT OF SUCH PERSON. * * *"

AS YOU WILL OBSERVE, THE 1954 LAW PROVIDES A SAFEGUARD TO PROTECT YOU FROM EXCESSIVE HARDSHIP BY REQUIRING THAT INSTALLMENT DEDUCTIONS FROM YOUR PAY SHALL NOT BE IN AN UNREASONABLE AMOUNT.

IT MAY BE STATED FOR YOUR INFORMATION THAT ANY COLLECTION ACTION TAKEN BY THE DEPARTMENT OF THE ARMY WILL NOT PREJUDICE YOUR RIGHT TO FILE CLAIM WITH OUR OFFICE IF SUBMITTED WITH EVIDENCE ESTABLISHING THAT YOU DID NOT RECEIVE OR DERIVE BENEFITS FROM THE PROCEEDS OF THE INVOLVED CHECKS.