(A-61298) TRANSPORTATION-FARES-IN EXCESS OF LOWEST COMBINATION Where a transportation request calls for transportation at lowest rate available for coach service, payment therefor from appropriated funds on the basis of a through fare in excess of a combination of fares, over an intermediate point, affording the service required, is unauthorized. Comptroller General McCarl to the Auditor, Passenger Receipts, Great Northern Railway Company, April 9, 1935: There has been considered the matter of your supplemental bills P-2531-A for $41, P-2732-A for $2.79, and P-2814-A for $16.88, transmitted to this office by the disbursing clerk for the Department of Justice at the United States Penitentiary, McNeil Island, Wash., and representing additional charges claimed for the transportation of discharged prisoners from Tacoma, Wash., to Phoenix, Ariz., Tucson, Ariz., and Fort Worth, Tex., in December 1931, and February and March 1932. The travel in question was covered by transportation requests J-362957, December 4, 1931, and J-362969, December 10, 1931, to Phoenix; J-362958, December 6, 1931, and J-376349, March 3, 1932, to Tucson; and J-376323, February 15, 1932, to Fort Worth. All of the requests were drawn upon the Great Northern Railway, and each called for transportation of one person at the lowest rate and specified the class of service desired as "Coach, if available." The original bills covering this service claimed charges on the basis of fares of $45.49 to Phoenix, $47.33 to Tucson, and $80.72 to Fort Worth, said fares being constructed apparently by combining coach and first-class fares as follows: In the audit of the accounts of the disbursing clerk, who paid the charges so claimed, this office suspended credit in the amounts of 96 cents per passenger for the travel to Phoenix, $2.12 per passenger to Tucson, and $25.51 per passenger to Fort Worth, total $31.67, on the basis of fares constructed as follows: Upon request of the disbursing clerk for remittance of the overpayments, the supplemental bills above noted, were presented. In explanation of the supplemental bills, your letter of transmittal states, in effect, that, notwithstanding the transportation requests called for coach tickets if available, the charges originally claimed were in error in applying a coach fare to any portion of the journey for the reason that there were no coach fares available between these points; that inasmuch as the requests called for through tickets and through tickets were furnished, the "charge would have to be made on the basis of the only regular through rate that is available, that would be the first-class rate. In support of this contention you cite and quote from A. T. & S. F. Railway v. United States, 256 U. S. 205. The cited case involved travel of groups or parties between points between which no through party fares were published. The accounting officers adjusted the accounts on the basis of combining the individual fare for a part of the journey, multiplied by the number of travelers concerned, with a party fare for the remainder, the charges so resulting being less than the charges claimed, on the basis of the through individual fare. There was thus a disapproval of the constructed through party fare between points between which no party fare was published. In other words, the tariff did not publish a through party fare or parties fares to and from an intermediate point, and since the only through fares were individual fares, it was held that individual fares must be applied to the through service there concerned. The instant case presents a different situation. The fares used in determining the suspension in the disbursing clerk's account, as well as the fares used in the supplemental bills, are all individual fares. The question is whether upon a transportation request which clearly shows that the service desired was transportation in coaches at the lowest rate the charges properly applicable are those resulting from the higher first class fare published as applying from origin to destination, or a lower fare constructed by combining fares to and from an intermediate point applicable to the service requested and performed. The first-class fare of $5.21 to Portland entitled the traveler to transportation in coaches between Tacoma and Portland. Apparently the first-class fare was the lowest fare applicable for coach travel between those points. However, from Portland to San Francisco, there was a first-class fare and a coach fare, either of which entitled the passenger to travel in coaches between those points, the latter being the lower fare. Likewise, the same situation obtains for coach. travel between San Francisco and Tucson, or Fort Worth. Each of these fares affords between the points noted the accommodations and services that the traveler desired. The accounting officers have held for many years that where a through fare exceeds the aggregate of the intermediates, the charges for Government transportation will be allowed only on the basis of the lower combination and that the use of appropriated funds is unauthorized for payment of charges necessitating subsequent reparation proceedings to recover the excess. If it be urged that the coach fare and the first-class fare are not like fares and that, therefore, a through first-class fare in excess of such a combination is not an unlawful fare, it would appear that such conclusion would be predicated upon the proposition that the published through first-class fare affords privileges which the coach fare does not afford. On the basis of such a distinction, however, it is to be noted that there is no published through fare affording only the service and privileges which the traveler desired and in such circumstances it would appear that the lawful fare for the services requested to be furnished is the lowest combination affording such service. There appears no reason, therefore, why, since the requests clearly showed that travel in coaches at lowest rates available was required, the Government should be charged any more than the lowest rate applicable to such service. Accordingly, the claims presented in the supplemental bills are disallowed and there will be deducted from some unpaid bill the sum of $31.67, representing the overpayments as herein stated. (A-60467) HOME OWNERS' LOAN CORPORATION-EMPLOYMENT OF There is nothing in the act of June 13, 1933, 48 Stat. 131, authorizing an attorney-employee of the Home Owners' Loan Corporation to accept employment, to examine titles, make reports thereon, etc., for applicants to the Home Owners' Loan Corporation for loans. Serving as an attorney in preparing papers in connection with an application for a loan from the Corporation by which employed would or might be antagonistic to duties under the Corporation. Authority given by law to a public agency, such as that given to the Home Owners' Loan Corporation by the act of June 13, 1933, 48 Stat. 132, to "determine its necessary expenditures" does not place such agency beyond all law or accountability with respect to its expenditures, rather there is imposed a responsibility specifically to determine as necessary to the carrying out of its public duty any expenditure not in conformity with law, sound public policy, or established accounting requirements, and necessarily, in advance of the incurring of the obligation as the authority is not to condone an unlawful use but rather to determine that a contemplated use is necessary to the discharge of the public duty. Comptroller General McCarl to The Chairman, Federal Home Loan Bank Board, April 10, 1935: There has been received your letter of February 18, 1935, as follows: I attach an opinion of the general counsel of Home Owners' Loan Corporation which states the facts upon which it is given and respectfully request your opinion as to whether or not the payments referred to were legally made. The opinion of your general counsel is as follows: I am informed that Messrs. B. L. Kessinger and M. Carlisle Minor were employed by Home Owners' Loan Corporation on a monthly salary basis and that they have performed the services for which they were employed and that they have expended the usual hours required by the Corporation in its employment to earn their salaries. I am informed that, at the same time, the Corporation, knowing that these gentlemen were employed by the Corporation on a salaried basis, approved them as fee attorneys acceptable to the Corporation, to be employed by a home owner to examine and report upon titles and close loans at the expense of the home owner. This method of operation by which a lawyer is employed by the Corporation and is permitted to do any private practice on the outside is contrary to the policy of the Corporation and the arrangement in these cases has been discontinued. The arrangement in the cases referred to, however, was approved by the board of directors of the Corporation. Upon this statement of facts, I am requested to give an opinion as to whether or not such arrangement was illegal. Home Owners' Loan Act of 1933 provides in reference to the Corporation "and shall determine its necessary expenditures under this act and the manner in which they shall be incurred, allowed, and paid, without regard to the provisions of any other law governing the expenditure of public funds." It is my opinion, therefore, that the employments above referred to and which were approved by the Corporation were legal. Section 4 (e) and (f) of the Home Owners' Loan Act of 1933, dated June 13, 1933, 48 Stat. 131, requires that loans " shall be secured by a duly recorded home mortgage." There is imposed on the Home Owners' Loan Corporation the responsibility of approving the title to the property prior to granting of loans thereon. 7556°-35-49 Section 4 (j) and (k) of the same act provides, in part, as follows: (j) The Corporation shall have power to select, employ, and fix the compensation of such officers, employees, attorneys, or agents as shall be necessary for the performance of its duties under this act, without regard to the provisions of other laws applicable to the employment or compensation of officers, employees, attorneys, or agents of the United States. No such officer, employee, attorney, or agent shall be paid compensation at a rate in excess of the rate provided by law in the case of the members of the Board. * (k) The Board is authorized to make such bylaws, rules, and regulations, not inconsistent with the provisions of this section, as may be necessary for the proper conduct of the affairs of the Corporation. * The Manual of Rules and Regulations of the Home Owners' Loan Corporation, VI-1-d (1), (2), and (7) and VI-16 (as amended by bulletin A-35, dated January 8, 1935), provide, in part, as follows: (1) Selection of fee attorneys and title companies.-The State manager and State counsel shall select and recommend responsible title companies for title examinations and other purposes required in connection with making loans, and shall select also all necessary fee attorneys, who shall be the best qualified attorneys available in the territory. Both individual attorneys and firms of attorneys shall be selected on the basis of the best interests of the Corporation. All fee attorneys and title companies shall be selected subject to the approval of the general counsel. (2) Fee attorneys are not employees.-Fee attorneys are not employees of this Corporation and shall be paid upon a fee basis. All such attorneys should be directed to execute the form "Statement of fee attorney." Such statement shall bear the approval of the State counsel and the State manager, where submitted by the retail department, and that of the special representative and chief counsel where submitted by the wholesale department. (7) Attorneys who are holding public office.-Title work shall not be given to a fee attorney actively engaged in running for public office, but he shall be allowed to complete work previously given him before he sought such office. If a fee attorney is holding any public office, which makes it impossible for him properly to handle title work for this Corporation, then during such period of office no title work shall be referred to him. The holding of public office shall not disqualify a fee attorney, if the duties of such office do not interfere with proper handling of the title work of the Corporation. No person may be employed as a salaried attorney while engaged in running for public office or while holding public office. 16. Fees, charges, and expenses Ordinary charges authorized and required for services rendered for examination of abstracts, examination of title, and appraisal, and like necessary services shall consist of the following: * Necessary recording, and similar fees charged by public officials; Necessary charges for perfecting title as approved by the State counsel of the Corporation in a sum not exceeding $75.00 in any case unless specifically approved by the board of directors; Necessary and usual fees, not exceeding the customary fees for such services, for abstracts, examinations of abstracts, certificate of title or title insurance as recommended by the State manager and State counsel with the approval of the general counsel; Charges of attorneys or title companies for escrow services or for closing loans as recommended by the State manager and State counsel and approved by the general counsel, and Any other necessary charge for like necessary services as specifically approved by the Board of Directors. All the above incidental costs should be paid by the applicant at the time of closing. If the applicant is unable to pay these costs, the amount may be advanced to him and incorporated in the mortgage debt, provided the whole is |