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B-187456 1 (1977-03-08)

handle is hein.gao/gaobadeku0001 and id is 1 raw text is: THM COMPTROLLER UENUNAL OEC0UIN or THE UNITEO UTATRS wAEMINoTON. 0.C. e0545 PRILE: D-187456 DATE: bthug W 37T MATTER CF: Travelers Indemaity Company - Reconsideration DIGEST: Miller Act surety which has received payment in excess nf its proven expenditures under its binding obligations in connection with a construction contract has no claim against undisbursed funds held by Government. Travelers Indemnity Company (Travelers) has requested reconsideration of our decision Travelmrs IndeaitY:Comany, B-187456, November 4, 1976, in which we found that Travelers was not an assignee under the Aaxigment of Claims Act (1940), as amendAd, afd that consequentlyhe Government's right of set-off against contract funds in its hands for unpaid taxns was superior to any right to the funds Travelers might have as surety under a iller Act payment bond. Travelers asserts that it was a per- formance bond surety and that as such it has the superior claim to the funds. Travelers had sought payment from the Air Force of the balance of the contract funds in the amount of $55,687.22 as assignee under an assignment made by Bell Contracting Company, Inc. (Bell), a painting subcontractor under Air Force prime contract No. 149642-75-90318, awarded to the Small Business Administration under the 8(s) program. Subsequent to the pur- ported assignment, the Internal Revenue Service served the Air Force with a notice of levy in the amount of $111,883.25 for unpaid taxes crwed by Bell. The ra c'rd submitted to thia Office by te Air Force for an advancetdecision on the Travelers claiso'the total funds contained Ih& purported assignment, a payment log furnished by Travelers shoving payments for labor and materisls only. and letters to the contracting officer frop! Travelers and Bell. No specific request was made by Travelers as surety under the per- formance bond, and no *oof w&s offere4 showing entitlement to the entire contract batance, save for the assignnt. In support of its request for recon-ideration, Travelers stated that when Bell bcame financially unable to perform the contract, Bell and Travelers antered into an oral, informal agreement whereby Travelers, pursuant to its obligation under -- LE

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