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B-223146 1 (1986-10-07)

handle is hein.gao/gaobadmmz0001 and id is 1 raw text is: The ComptroUer General of the United States Washington, D.C. 20U8 Decision Pension Benefit Guaranty Corporation's Use of Matterof. Contingent Fee Arrangement. With Outside Counsel File: B-223146 Date: October 7, 1986 DIGEST Pension Benefit Guaranty Corporation (PBGC), when serving as trustee for terminated pension plan, is authorized to exer- cise all powers possessed by private party when serving as trustee for pension plan ana is not constrained by laws applicable to contracting by Federal agencies or expenditures from public funds. Therefore PBGC may modify existing con- tract and enter into a contingent fee contract with outside counsel for litigation services. DECISION This decision is in response to a request for an advance decision submitted by the General Counsel of the Pension Benefit Guaranty Corporation (PBGC) asking whether the PBGC is authorized to enter into a contingent fee arrangement with outsiae counsel for litigation against Navistar Inter- national Corporation (formerly International Harvester Company (IH)), Envirodyne Industries, Inc. (Envirodyne) and other defendants. As will be explainea in more detail below, we find that the PBGC, when serving as trustee for terminated plans,is authorized to enter into the proposed agreement since it is not prohibited by law or public policy. We note that PBGC when serving as trustee is required to render an accounting related to its trust administration to a court and thus any fee charged by attorneys acting on behalf of the PBGC would be subject to judicial review (notwithstanding the contingent fee agreement) to determine its reasonableness under the circumstances. BACKGROUND The General Counsel of PBGC states in his submission that pursuant to provisions of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. §§ 1301 et seq., on December 18, 1981 and November 12, 1982, the PBGC filed two suits in the Northern District of Illinois against IH, oa3-Tooci / / F/ 7173

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