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B-196275 1 (1981-10-29)

handle is hein.gao/gaobadjvu0001 and id is 1 raw text is: 



        .. j                     ogL R G . TH
                                         THE COMPTROLLER GENERAL
                DECISION                 OF THE UNITED STATES
                                         WASHINGTON, 0.C. 20548




                FILE: B-196275                DATE: October 29, 1981

                MATTER OF: Centennial Systems, Incorporated


                DIGEST:

                1.  Where the Government has received notice of a
                    valid assignment, but thereafter erroneously
                    pays assignor, it remains liable to assignee
                    for the amount of the erroneous payment.

               2.   Although assignment did not comply with
                    requirements of the Assignment of Claims
                    Act, the record establishes that the
                    Government was aware of, assented to and
                    recognized the assignment of a contract.
                    Therefore, the Government should pay
                    money owed under contract to assignee.

                    The Department of Health and Human Services (HHS)
               requests our decision as to the propriety of paying Cen-
               tennial Systems, Incorporated's (Centennial), claim for
               $8,654, arising from the apparent assignment to the
               firm of the proceeds from two .THS purchase orders,
               Nos. FPH-78-29 and RO 11-79-79, under contract No. GS-005-
               43360.

                    In our view; HHS should pay Centennial's claim for
               $3,258 under purchase order FPH-78-29  and the $5,387
               under purchase order RO 11-79-79.

                    In fiscal year 1978, HHS contracted with LCS Corpora-
               tion (LCS) for the lease of word processing equipment
               for its New York regional office. In July of 1978, LCS
               sold the equipment to Centennial and assigned the
               remaining proceeds of its contract lease with HHS under
               purchase order No. FPH-78-29 to Centennial.

jjyl                Under this agreement, Centennial leased back all
               the purchased equipment to LCS, with the understanding
  4            that this equipment would be subleased to the Govern-
               ment. The parties agreed that all proceeds due LCS
               under the LCS-Government leases would be assigned to



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