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B-181471 1 (1974-07-03)

handle is hein.gao/gaobadcdr0001 and id is 1 raw text is: THE COMPTROLLER GENE:RAL DECISION . OF THE UNrITED STATEs VI VV A- , T1 FILE: B-181471 DATE: Taly 3, 171 ~bv' MATTER OF: Balboa Insurance Company DIGEST: Payment bond surety, having settled 813,636.40 in obligations to materialmen owed by contrac- tor that cannot be located after completion of contract, may be reimbursed from $15,480 contract balance upon receipt of indemnification agreement protecting Government against subsequent claim by contractor. Contract No. N62474-72-C-8345 was awarded to H. Cline Construction Company (Cline) for the repair and alteration of certain buildings at the Marine Corps Air Station, El Toro, California. Payment and performance bonds on the contract were issued by Balboa Insurance Company (Balboa). On June 27, 1973, Balboa notified the Government that Cline had defaulted under the payment bond by failing to pay certain labor and material costs incident to the contract and reauested that further payments to Cline be withheld. The Government com- plied with the Balboa request. Subsequently, Balboa furnished evidence that, as a result of the default by the contractor on the obligation under the payment bond, it paid $13,636.40 to materialmen. The contract is under the contract. unsuccessful. Thus, neering Command, has complete. There is a balance of $15,480 All attempts to locate Cline have been the Acting Counsel, Naval Facilities Engi- requested a decision as to the proper payee. In the circumstances, since no other party has made a claim for the funds heid by the Government, the surety may be reimbursed the $13,636.40 settled under the payment bond upon receipt of an indemnification agreement protecting the Government against a subsequent claim by the contractor. B-177870, March 20, 1973; and B-158227, March 6, 1974. There is no basis for disbursing the remainder of the contract balance at this time. Deputy Comptroller General of the United States

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