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![handle is hein.gao/gaobaadhp0001 and id is 1 raw text is: I2
do- OLLIJGENERAL OF TIIF UNITED STATES
'A ,'-,'' WASHINGTON, D.C. 20543
13-1791415
August 28 1973
Maryland Casualty Company
Wheaton Plaza Office Building
Suite 6OO
Wheaton, 1-Lrylend 20902
Attention: Mr. Richard L. Duffey
Claims Department
Gentlemn:n
11hi in in roply to your letter of June 28, 1973, requesting
reconsideration of our Dettle:ment Certificate dated rebruary 3, 1972;
which denied your claim for $h,919 under General Services Administra-
tion (USA) contrat lio, 0S03-1567l4.
The rocord indicates that you were the payr.ent and performance
bond surety for J & B Construction Compiny, IncorpDrated (J & A),
( the contractor on the above-t.,entioned GA contract. The record
further indicates that J & B was defaulted in December 1,069, anQ
that upon completion of all the required work, the amount of
s-,4,919 rerained for dichtirsement under the contract, You claimed
this sum becauno of your payrento in oxcavs of t9o,00 to various
suppliers purstant to the terms of the riment bond, On December 29,
1c69, however, the Internal Revenue Service served a tax levy upon
GSA in the amount of $63,017.85 (subequently reduced to $28,165.65
plus interest) arainat any proceeds due to J & B, ,GA nubriitte1 the
mattor to this Off I co for resolution, and oa advise'] that under
United States v, Unsey Truct Co., 332 U.b. 231 (1917), the
Government'a riglt of set-off P* is superior to that of a surety
whone elinim Is based upon payrenta to 1&borers and materialmen
under the payment bond.
In your request for reconsideration, you stated that Fireman's
Fund Instrance Co-nany v. United States. 190 oC. 01. 8C4, i1e7v2d
706 (1970)- should be considered as superseding Munsey and as
authorizing payment to you. The Firerxk.n's Fund ease recognized
certain subrogation rights in a pay,-ent bond surety. but held only
that the Government ascumed the risk of liability to the surety
when the contracting officer paid certain contract proceeds directly
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