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B-186852 1 (1976-10-21)

handle is hein.gao/gaobaddwf0001 and id is 1 raw text is: 8-hA- i F ¶.THE COMPTRDLLIEP GENERAL DECISION j.-lU OF THL UNITED STATES WASHINGTON, D.C. P0540 0~ C FILE: B-186852 DATE: October 21, 1976 MATTER OF: L, B. IManufacturing Company DIGIST: 1. Where purchaser of excesn high grade zinc sept chec)k to agency and check was made payable to agency but drawn on bank account of third party, such check, which was accepted and paid by bank, may properly be considered as payment from purchaser and subject to setoff. 2. Where inadvertent,.erroneous advice of agency concerning amount of Government's excess zinc results in overpayment by purchaser, agency has right and duty to apply excess payment to extinguish- ment of indebtedness of purchaser, even though portion of such debt arose from separate and independent transaction. The General Services Administration (GSA) requests an advance decision concerning the propriety of its applying an erroneous overpayment received from the L.B. Manufacturing Company (LB) to an existing indebtedness to it by LB. The record shows that GSA and LB entered into contract No. GSw00-DS-(S)-47849 under which LB agreed to purchase 456,000 pounds of high prade zinc for $160,875 and 350,000 pounds of prime western zinc for $119,875. Subsequently, LB took delivery of some high grade zinc and was erroneously advised by GSA that it still did not take delivery of about 315,000 pounds of high grade zinc, GSA advised that under the contract the cost of the undeliveted high grade zinc plus an accrued scorage charge was $127,575. LB later sent GSA a check in the amount of $127,575 drawn on the General Cable Corporation's bank account and made payable to the urder of GSA. Ip its letter enclosing the check, LB stated that such check was payment for the undelivered high grade zinc and provided GSA with instructions for shipment. GSA accepted the check (which was accepted and paid by the bank) as payment in full. It later appeared that the correct amount of undelivered high grade zinc under the contract was 297,282 pounds, a variation of quantity within the limits of the contract. The correct cost of that - 1 -

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