
    PINE MOUNTAIN LUMBER COMPANY, INC. v. THE UNITED STATES
    [No. 150-55.
    Decided July 12, 1957.
    Defendant’s motion for rehearing overruled October 9, 1957]
    
      
      Mr. Kenneth Liles for the plaintiff. Messrs. Sutherland. AsMll dk Brennan were on the brief.
    
      Mr. ’William A. Stern II, with whom was Mr. Assistant Attorney General George Oochran Daub, for the defendant.
   Laramoke, Judge,

delivered the opinion of the court:

Plaintiff brings suit to recover the amount of $23,523.81 claimed to be due by reason of two contracts it had with the Government. The defendant does not defend the correctness of the claims, but resists recovery here on the ground that plaintiff is barred from bringing suit because its cause of action accrued more than sis years prior to the filing of its petition on April 8,1955,28 U. S. C. 2501.

The two contracts under which plaintiff is seeking recovery are No. W-09-026-eng-(MSP) 10448 calling for the furnishing of lumber to the Naval Air Station, Jacksonville, Florida, hereafter referred to as the “purchase order” contract, and No. W-09-026-eng-(MSP) 10363 providing for harvesting and manufacturing of trees located on Government land into lumber and crossties, and will be hereinafter referred to as the “lumber” contract. The “purchase order” contract was entered into on June 26, 1941, and numerous shipments were made thereunder by the plaintiff, but most of them were rejected and returned as not meeting contract requirements. A total of 56,301 FBM was accepted by the defendant and the amount due the plaintiff thereby aggregated $2,604.56. The “purchase order” contract was terminated by the Government for failure of the plaintiff to make deliveries, but no liquidated damages were assessed. Plaintiff has never received any part of the $2,604.56 due it for the deliveries that were accepted. The stipulation of fact filed by the parties with the commissioner of this court fails to show the exact date that this contract was terminated, hut the last delivery accepted by the Government was on August 1,1947.

The “lumber” contract was entered into on June 16, 1947, and called for the plaintiff to furnish all plant, labor, materials, supplies and equipment necessary to manufacture approximately 36,000,000 FBM of lumber and crossties from standing timber owned by the Government at Camp Stewart Military Beservation, Hinesville, Georgia. The contract completion date, as extended, was January 31,1951. Plaintiff would fell the Government-owned trees, manufacture them into the specified lumber products and haul them to a storage area for further processing or storage for future shipment. As deliveries were made, plaintiff would submit an itemized invoice, usually covering a week’s production, showing the quantities manufactured during that week. Certain other deliveries were made from the sawmill site direct to a railroad siding and loaded on cars for shipment direct to a designated consignee. Invoices were also prepared on these shipments. Both the invoices covering the shipments to the storage area and those to the railroad siding were processed by the Government for payment to the plaintiff.

Plaintiff was paid in full the contract unit price for shipments made direct to consignees while on shipments made into the storage area plaintiff was paid 70 percent of the unit contract price at the time of such delivery and later paid the remainder (30%) when the material was further processed, loaded on cars or trucks, and accepted by the carrier for delivery to the consignee. The last shipment under the “lumber” contract from the storage yard to a consignee was made January 30, 1951. Payment on $20,919.31 worth of invoices dated during the year 1948 for lumber delivered pursuant to the contract has been withheld by the Government and remains unpaid.

The invoices covering the $2,604.56 due on the “purchase order” contract and the $20,919.31 due on the “lumber” contract were referred by the Navy Central Disbursing Office and the Army Finance Officer, Atlanta, Georgia, respectively, to the General Accounting Office for application against a claimed indebtedness of Pine Mountain Lumber Company to the United States in the sum of $23,523.87.

The Pine Mountain Lumber Company was a partnership consisting of John J. Neely and Boy E. Neely as copartners doing business in Manchester, Georgia. On June 7, 1946, the plaintiff corporation was formed and issued all of its capital stock to the partnership in exchange for some of. the partnership assets. At the time of incorporation of the plaintiff the partnership retained assets, including real property, and it was at all times pertinent to this opinion solvent. The partners themselves have always been financially able to respond to any claims of the Government. In 1947 John J. Neely and Boy E. Neely sold their stock in the plaintiff corporation to the present owners, B. C. Brooks and J. Lester Souter who are the sole stockholders in the Pine Mountain Lumber Company, Inc. Neither at the time of incorporation, nor at any time thereafter, did the plaintiff corporation make any agreement with either the partnership or the partners to pay any of the liabilities of the partnership or its partners.

In refusing the plaintiff payment of the $23,523.87 due on the two contracts, and forwarding invoices for that amount to the General Accounting Office for application against an alleged indebtedness of the partnership, the Government was apparently of the opinion that the Pine Mountain Lumber Company and the Pine Mountain Lumber Company, Inc. were one and the same entity. In accordance with its belief that the alleged debt of the partnership should be satisfied by the plaintiff, the General Accounting Office under date of April 11,1949, issued certificates of settlement to the plaintiff in connection with the “lumber” and “purchase order” contracts. These certificates were signed for the Comptroller General of the United States and certified that there was owing the plaintiff the amount of $23,523.87. However the certificates further stated that the amount therein allowed was being applied to an indebtedness claimed to be due the United States oh previous contracts with the partnership.

In defending plaintiff’s suit at this time, the Government does not argue that the General Accounting Office was correct in crediting amounts due the plaintiff on its contracts against an alleged indebtedness claimed due from the partnership, and does not claim, should we find that plaintiff’s suit was timely filed, that it is entitled to offset any recovery by the amount of the partnership debt. There is ample evidence in the record to show that the Government should have determined that its claim lay against the partnership and or partners and not against the plaintiff corporation, a separate legal entity. Defendant only argues that plaintiff’s claim is now time barred and therefore no recovery can be had.

It is the position of the plaintiff that it has filed a timely suit, i. e., within six years of the time its claim first accrued. For support of this position plaintiff relies on two basic propositions: (1) that the certificates of settlement issued by the Comptroller General on April 11, 1949, represent an account stated and since plaintiff’s petition was filed within six years of the rendering of the account the suit is timely; and (2) even if the certificates do not represent an account stated the suit is still timely with respect to the “lumber” contract because the completion date thereunder was less than six years prior to the time it filed its petition.

We think that plaintiff is correct in its contention that the certificates of settlement are an account stated. An account stated is a contract upon which suit may be brought. The consideration for the contract is the promise of the debtor, either expressed or implied, to pay the amount so stated and “must be founded on previous transactions of a monetary character creating the relationship of debtor and creditor.” Williston on Contracts, vol. VI, rev. ed., § 1862. There is no question here of a previous transaction, but only whether there has been a promise to pay on the part of the debtor, i. e., Government.

We have many times held that the issuance by the Commissioner of Internal Bevenue of a certificate of overassessment amounts to an implied promise to pay the amount shown to be due thereon. Wood v. United States, 84 C. Cls. 367; Goodenough, Trustee v. United States, 85 C. Cls. 258. In the case of Marr v. United States, 123 C. Cls. 474, we held that the issuance by tbe Comptroller General of a certificate of settlement gave rise to a promise to pay. Therefore there is little doubt that if the certificate of settlement in this case contained only the statement of the amount due without the additional wording with regard to the application of the sum to an alleged debt of the plaintiff we would have a simple account stated upon which suit could be brought.

It is a requisite of an account stated that debits and credits will be determined and an account struck for the balance. It is only for the balance that an account is stated, Holmes v. United States, 79 C. Cls. 263, and the cases cited therein. In other words a person claiming under an account stated may not pick and choose such items in the account that are favorable to him, but must take the whole account as stated. However, where a balance is struck in favor of a claimant and the debtor either denies or misapplies the payment of the amount so stated, the claimant has an action for the full amount notwithstanding the misapplication or denial of payment. This was precisely the situation in the Goodenough case, supra.: There the Commissioner of Internal Revenue issued certificates of overassessment indicating an overpayment of taxes, but denied a full refund on the ground that part of the overpayment was barred because “no claim has been filed within the statutory period requesting refund of tax * *

The small remaining amount of the overpayment not so barred was paid by the Commissioner and the taxpayer brought suit in this court to recover the amount that was withheld. The court in discussing the question of whether the issuing of the certificate of overassessment constituted an account stated said:

* * * The defendant, however, contends that the refusal of the Commissioner to pay part of the overpayment prevents the certificate from being an account stated as to the balance unpaid. With this contention, we do not agree. In the case now before us, when the Commissioner presented the certificate of overassessment, he was stating in effect: “Here is the account of your taxes. It shows that the Government owes you a certain amount but I will pay only part of it as the remainder is barred by the statute of limitations”.

The court went on to hold that plaintiff could recover on an account stated notwithstanding the denial of payment by the Commissioner of Internal Eevenue.

In the case presently before the court, the Comptroller General was saying that the Government owed plaintiff $23,523.87 by reason of contracts between the parties, but that he would not pay it because it was going to be applied to an alleged debt of the plaintiff. We can see very little difference between this type of situation and that presented to the court in the Goodenough case. Both involve an erroneous application of the amount stated to be due from the Government.

In Bonwit Teller & Co. v. United States, 283 U. S. 258, the Commissioner of Internal Eevenue determined an overpayment of taxes and issued a certificate of overassessment, which showed on its face that a majority of the overpayment was being credited to a tax liability of another year. The taxpayer sued for the entire overassessment evidenced by the certificate and the Government admitted that it had erroneously credited part of the overpayment to another year’s taxes, but defended on the ground that refund was barred by the statute of limitations. The Supreme Court in allowing recovery held that the suit was not time barred because the cause of action arose out of the certificate and not the overpayment of taxes even though the Commissioner had credited part of the overpayment to taxes owed in another year. This was true even though the credit claimed by the Government was indicated on the certificate itself. See also Dorrance v. Phillips, 85 F. 2d 660, where recovery was allowed on an account stated where the certificates of overassessment showed part of the overpayment was being credited to taxes owed by another taxpayer.

The defendant says that the tax cases above cited and discussed are not apposite to the present situation because in those cases no claim ever arose in favor of the taxpayers until the Commissioner of Internal Eevenue issued certificates of overassessment and second if the General Accounting Office did make an error it was one of fact and not law. We find no merit in these contentions of the defendant. There is no difference between a certificate of overassessment and a certificate of settlement insofar as applying the law of an account stated is concerned. A taxpayer’s right does not arise solely because there has been a certificate of overassessment issued. He may sue for refund of taxes upon the denial of the Commissioner of his claim for refund or upon the failure of the Commissioner to act on such claim within six months of the time filed. Section 3772 (a) (2) of the Internal Eevenue Code of 1939. His rights under an account stated arise not because of the income tax laws, but because of the contractual relations created by that account. Also whether the mistake in applying the amount stated in the account was one of law or fact is of no consequence. The fact remains that payment was not made and suit may be brought by reason thereof. We hold that the certificates of settlement issued by the Comptroller General on April 11, 1949, were an account stated for the sum of $23,523.87. The denial of payment and application of the amount shown to be due thereon to an alleged debt of the plaintiff did not create a new balance, to which plaintiff would be bound under the ruling in the Holmes case, sufra. The implied promise was to pay the full $23,523.87, but the denial thereof was due to an erroneous conclusion of fact by the Government. Plaintiff’s suit is therefore not barred by the statute of limitations.

Since the Government does not contend that the General Accounting Office was correct in applying the amount due the plaintiff on its contracts to an alleged debt of the Pine Mountain Lumber Company partnership, plaintiff may recover the full amount as stated in the certificates of settlement issued by the Comptroller General on April 11, 1949. Due to the fact that plaintiff is entitled to recover on the theory of an account stated we will not take up the issue of whether it could have recovered under the “lumber” contract.

Judgment will be entered for the plaintiff in the amount of $23,523.87.

It is so ordered.

Madden, Judge; Whitakee, Judge; Littleton, Judge; and Jones, Chief Judge, concur.

FINDINGS OF FACT

The court, baying considered tbe evidence, tbe report of Commissioner Paul H. McMurray, and tbe briefs and argument of counsel, makes findings of fact as follows:

1. Plaintiff is a corporation, incorporated and doing business under tbe laws of tbe State of Georgia, with its principal office and place of business at Ellaville, Georgia.

2. Plaintiff is the sole and' absolute owner of the claim presented and has made no transfer or assignment of said claim, or any part thereof.

3. Plaintiff was duly incorporated in tbe State of Georgia on June 7, 1946, by order of tbe Superior Court of Merri-weather County, Georgia, upon tbe petition of John J. Neely, Eoy E. Neely and H. Briscoe Black, as incorporators. Its principal office was located in Manchester, Georgia. Its capital stock consisted of $100,000 in cash or other assets.

4. Between November 4, 1940, and June 30, 1946, John J. Neely and Eoy E. Neely did business as copartners in Manchester, Georgia, under the firm name and style of Pine Mountain Lumber Company.

5. On June 30, 1946, the said partnership had total assets of $394,149.27 and liabilities of $159,900.16, and a net worth of $234,249.11.

6. On July 1, 1946, the said partnership exchanged part ($100,000 worth) of its assets for the entire capital stock of the plaintiff consisting of 1,000 shares of the par value of $100 each.

7. At the time of the incorporation of the plaintiff certain assets of the partnership, including real property, were retained by the partnership and the partnership continued to own real property until May 18,1951, at which time Eoy E. Neely conveyed all interest in said real property to his brother John J. Neely.

8. The said partners have at all times been able financially to respond to the claims of the Government.

9. Neither at the time of its incorporation, nor at any time thereafter, did the plaintiff make any agreement with either the partnership or the partners to pay any of the liabilities of the said partnership or of its partners.

10. On September 12, 1947, John J. Neely and Roy E. Neely sold all of their stock in plaintiff to R. C. Brooks and J. Lester Souter for book value ($124,103.58) plus a premium of $40,000, or a total price of $164,103.58. Since that time, said R. C. Brooks and said J. Lester Souter have been and are the sole stockholders, officers and directors of the plaintiff.

11. On June 16, 1947, defendant, represented by the Department of the Army, Corps of Engineers, South Atlantic Division, Atlanta, Georgia, and plaintiff, entered into a contract whereby the contractor agreed to furnish all plant, labor, materials, supplies and equipment necessary to manufacture approximately 36,000,000 FBM of lumber and cross-ties from standing timber owned by the United States and to perform other operations incidental thereto, at certain unit prices specified therein, at Camp Stewart Military Reservation, Hinesville, Georgia, for an estimated total consideration of $1,284,750. The contract completion date, as extended, was January 31, 1951. Thirteen supplemental agreements (modifications) numbered 1 through 13, were issued in connection with this contract. The contract bore the number W-09-026-eng-(MSP)-10363. Copies of said contract and supplemental agreements have been received in evidence as plaintiff’s exhibit 1.

12. Plaintiff felled trees and manufactured them into rough lumber, ties or timbers, and hauled them from the area on which cut at Camp Stewart into a designated storage area for further processing and/or storage for future shipment. As deliveries of material were made into the storage area, plaintiff would submit an itemized invoice, usually covering a week’s production, showing the quantities manufactured during that week. The quantities shown on the-invoices were verified and certified by the Government’s Resident Inspector on the invoices at the site of the work. Certain other deliveries were made from the saw-mill site, direct to the railroad siding, loaded on cars for shipment direct to a designated consignee, and therefore were not placed in the storage yard. Invoices were also prepared on these shipments and verified. Plaintiff was paid the full contract unit price for shipments made direct to consignees, while on shipments made into the storage yard, plaintiff was paid 70% of the contract price at the time of such delivery and later paid the remainder of the unit price (30%) when material was further processed, loaded on cars or trucks, and accepted by the carrier for shipment to a consignee. The invoices covering material produced and placed in the storage yard or for shipment made direct, after they were certified by a representative of plaintiff at the site of the work, were verified and approved by the Resident Inspector and then submitted to the Fiscal Office of the Division of Engineers, Atlanta, Georgia, or to the Savannah District Engineer, Savannah, Georgia, for preparation of vouchers, and then transmitted in turn to the Finance Officer, United States Army, Atlanta, Georgia, for payment. Approximately 140 vouchers in all, were prepared either by the Division Engineer, Atlanta, Georgia, or the District Engineer, Savannah, Georgia, covering the same number of partial payments.

Plaintiff submitted approximately 651 vouchers covering shipments made into the storage yard, from the storage yard, or shipped direct to consignees, and for incidental work in connection therewith under the contract. The first invoice for material produced covered the period from July 1 through July 10, 1947. The first voucher, dated July 28, 1947, was submitted to the Finance Officer for payment and was paid by Voucher No. 15,345,702, dated August 6,1947, in the sum of $8,214.13. The first shipment to a consignee was made August 20, 1947. The last shipment under the contract from the storage yard to a consignee was made January SO, 1951. The last invoice submitted by plaintiff was dated February 8,1951.

The plaintiff performed completely all of its obligations under this contract, as amended.

13. Each shipment made to a consignee, either from the storage yard or direct, was covered by a shipping document prepared by a Government employee at Camp Stewart, Georgia. Delivery to the storage yard by plaintiff was not considered to constitute delivery and acceptance by the United States, because plaintiff, in most instances, was required to perform additional services before final shipment was made.

14. On June 26, 1947, at a lumber auction conducted by the Department of the Army, Corps of Engineers, Army-Navy Lumber Agency, Atlanta, Georgia, plaintiff submitted its bid to furnish and deliver approximately 225,000 FBM of certain grades and species of 1" x 4" lumber for delivery to the Supply Officer, United States Naval Air Station, Jacksonville, Florida, for a total consideration of $11,913.75. Plaintiff’s bid was accepted on behalf of the Government and a purchase order, dated June 26,1947, was issued to plaintiff to furnish and deliver such lumber.

15. Numerous shipments were made on various dates by plaintiff under said contract; however, most of them were rejected and the rejected lumber was removed by plaintiff or returned to it. Deliveries of lumber which met contract requirements were made and accepted under this contract as follows:

The balance of plaintiff’s contract No. W-09-026-eng-(MSP)-10448, was terminated by the Government for failure of plaintiff to make deliveries thereunder, but plaintiff was not charged with any claim for damages because of such default.

16.None of the invoices under contract No. W-09-026eng-(MSP)-10448 were paid to plaintiff by the Navy Central Disbursing Officer, who received them from the Division Engineer as follows:

Invoice No. 3352-August 25,1947

Invoice No. 3353-August 15,1947

Invoice No. 3354-August 15,1947

The invoices were referred to the General Accounting Office by the United States Navy Central Disbursing Office by letter dated March 15, 1948, for application against claimed indebtedness of Pine Mountain Lumber Company (the partnership) to the United States in the sum of $23,523.87.

Other invoices aggregating $20,919.31, submitted in connection with contract W-09-026-eng-(MSP)-10363, were prepared in the office of the Division Engineer, certified for payment, and forwarded to the Finance Officer, United States Army, Atlanta, Georgia, for payment. Said Finance Officer forwarded said invoices to the General Accounting Office for application against the aforesaid alleged indebtedness of Pine Mountain Lumber Company (the partnership) to the United States. Said vouchers and invoices are as follows:

1 Of the above amount the sum of $1,405.53 was paid. The difference of $1,607.27 was withheld and applied on the indebtedness.

17. Prior to August 25,1947, the Navy Central Disbursing Office in Charleston, South Carolina, and the Division Engineer in Atlanta, Georgia, had been demanding from plaintiff refund of alleged overpayments made to Pine Mountain Lumber Company (the partnership) under contracts made in 1943 with Pine Mountain Lumber Company (the partnership ). On August 25,1947, plaintiff wrote the United States Navy Central Disbursing Office in South Carolina a letter, copy of which is as follows:

Gentlemen: We received in the mail today a copy of your Mr. S. Delongs letter to the Central Disbursing Office at Washington, in respect to indebtedness of Pine Mountain Lumber Company, Inc., to the United States. Government.
This corporation was organized and incorporated under the laws of the State of Georgia on June 15th 1946. We have no record of any indebtedness being due the United States Government and would ask you to please advise us what this indebtedness you talk of is, as we believe that you must have this corporation confused with some other organization.
Your early acknowledgment will be yery much appreciated.

In reply thereto, the Navy Central Disbursing Office wrote plaintiff on September 24, 1947, a copy of which with its enclosure, reads as follows:

Gentlemen: Reference is made to recent correspondence between your company and this office in connection with an alleged indebtedness to the U. S. Government. A total of three invoices amounting to $2604.56 have been forwarded to the Navy Central Disbursing Office, 1608 Arlington Annex, Washington to apply against this indebtedness in accordance with instructions from the Bureau of Supplies and Accounts. As explained to you in letter dated 22 September 1947, this office has been attempting to obtain clarification of the indebtedness report with the view of releasing payment of the invoices received.
Attached hereto you will find a copy of letter from the Navy Central Disbursing Office, Washington, D. C. concerning this indebtedness. It will be appreciated if you will examine this letter and advise this office at your earliest convenience fully concerning the questions raised.
It should be explained that this office is not in position to enter into the discussion in any manner since it has no knowledge whatever concerning the indebtedness. A list of firms indebted to the government is forwarded to this office every two weeks and this office has no authority to issue checks payable to firms listed thereon. No alternative existed except to follow the list furnished and submit vouchers payable to you to the Bureau for final handling.
Regretting the inconvenience caused and trusting that the matter will be straightened out in the near future, I remain.
(Enclosure)
NXs-25331-(528)
9 September 1947
L6-2(P) (FDS-3)X3dtd 9/3/47
End-1 on U S NODO Wash.D.C. ltr
From: ComNavShipYdNor
To: US NCDO 1608 Arlington Annex Washington 25, D. C.
Subj: GAO exceptions — Contract NXs-25331 — Pine Mountain Lumber Co., contr
Enel: (A) Photostat of Pine Mountain Lumber Co. inv dtd 6/1/43 rendered under contract NXss-25331 for $534.11
(B) Copy of BuSandA ltr NXss-25331 (SPA) dtd 8/31/43 to Pine Mountain Lumber Co.
(C) Photost of BuSandA ltr NXsx-25331 (SP1-3) ACG: rkm dtd 12/14/44 to Pine Mountain Lumber Co.
1. The name of the company on which the General Accounting Office issued exceptions for payments made in 1943, in the accounts of B. H. Johnston, Symbol 52119, and W. W. Lamar, Symbol 52055, was “Pine Mountain Lumber Company”. Copies of the letters and amendments under the subject contract on file indicate Boy E. Neely and John J. Neely as partners, while invoices were certified and signed by M. K. Twitty, auditor under the firm name of “Pine Mountain Lumber Company”.
2. Copies of the dealer’s bills on which payments were made under this contract show that the billheads were in the name of “Pine Mountain Lumber Company” with John J. Neely and Boy E. Neely indicated as owners; photostat of one of the invoices, enclosure (A), is attached.
3. An amendment to the contract dated 31 August 1943, enclosure (B), issued to Pine Momitain Lumber Company, Manchester, Ga., was signed as accepted by John'J. Neely, Partner; likewise, Bureau of Supplies and Accounts’ letter dated 14 August 1944, enclosure (C), to the same company and address and was signed by Boy E. Neely, Partner.
4. From the evidence, it would appear that the owners, i. e., John J. Neely and Boy E. Neely, whether trading as “Pine Mountain Lumber Company” or as “Pine Mountain Lumber Company, Inc.” are the same.
Stamped: J. N. Hauling By direction.

Plaintiff did not reply to this letter, and on November 26, 1947, the Navy Central Disbursing Office at Charleston, South Carolina, again wrote plaintiff requesting a reply. Plaintiff replied on January 14, 1948, in a letter, copy of which is as follows:

Gentlemen: In respect to your letter of November 26,1947, in connection with your prior letter of September 24, 1947.
For your information, we would advise that when the Pine Mountain Lumber Company, Inc. was organized they purchased certain of the assets of the Pine Mountain Lumber Company, but assumed none of their liabilities.
The invoices in question on which payment is being withheld by you were submitted covering shipments on a contract issued to the Pine Mountain Lumber Co., Inc.
Trusting the foregoing information will cover your requirements, we remain.

18. On July 22, 1948, plaintiff, by its president R. C. Brooks, wrote the Navy Department a letter, copy of which is as follows:

Gentlemen: I have acquired one-half of the stock in the subject corporation and I have a letter from Mr. G. A. Summa Colonel, FD, Finance Officer, U. S. Army, Fort McPherson, Ga. requesting that I get information from you about an item of $28,528.87 now being held up.
This money covers work under a contract we are doing for the Govt, at Camp Stewart, Georgia, and we would like to know what it covers as we do not have any record of this. Will you please be kind enough to send us an itemized statement in next mail?
Your prompt attention will be appreciated.

19. In reply to the foregoing, letter, the Navy wrote plaintiff a letter dated July 29, 1948, reading as follows:

Deak Sis: Eeceipt is acknowledged of your letter dated 22 July 1948 requesting advice as to why monies are being withheld from the Pine Mountain Lumber Company, Incorporated.
The General Accounting Office took exceptions to certain payments made under Contracts NXs-25331, NXs-25350 and NXs-25939 for payments totaling $23,-523.87 made to the Pine Mountain Lumber Company in 1943. ' Numerous letters and telephone calls were made to your company requesting payment but same was not received which left the Navy no alternative but to place Pine Mountain Lumber Company on tlie Hold Up List and recoup payments.
By Claim Voucher No. 121494 dated 15 March 1948, Navy Vouchers totaling $2,604.56 were transmitted to the General Accounting Office to apply against your indebtedness, thus reducing it to $20,919.31. Advice has been received from the Department of the Army that vouchers totaling $20,919.31 will be transmitted to the General Accounting Office for liquidation of the balance outstanding. The name of your Company has been removed from the Navy Hold Up List and subsequent payments will be released to your firm.
It is not imderstood why you were not aware of this indebtedness for our file contains numerous letters from your company, the last having been received was dated 14 January 1948.

To the foregoing letter plaintiff replied on August 23, 1948, in a letter reading as follows:

GeNtlemen: I have your letter of July 29th relative to account of Pine Mountain Lumber Co., Inc.
You state that the General Accounting Office took exceptions to certain payments made under Contracts NXs-25331, NXs-25350 and NXs-25939 and we do not have any record of ever having such contracts.
Will you please send me an itemized statement disclosing just what the $23,523.87 held up is for?
Will you also refer to the last paragraph of your letter and send me a copy of your file as referred to in same?
Thanking you, I am,
Yours very truly,
E. C. Bkooks, Pres.,
Pine Mountain Lumber Co., Inc.

The Navy replied by letter dated September 3,1948, reading as follows:

Deference is made to your letter of 23 August 1948 requesting additional information regarding the amount of $23,523.87 withheld by the Government.
The General Accounting Office suspended the payments made by the Naval Supply Depot, Norfolk, Vir-
finia under Contracts listed below because the prices illed and paid were in excess of the applicable OPA ceiling prices. Eecoupment of $23,523.87 was necessary to bring the price within the OPA ceiling effective at the time the shipments were made.

20. Thereafter, under date of April 11, 1949, the General Accounting Office issued Certificates of Settlement to plaintiff in connection with contract No. W-09-026-eng-(MSP)~ 10448 and Contract No. W-09-026-eng-(MSP)-10363, reading as follows:

CERTIFICATE OF SETTLEMENT
General Accounting Office
D. O. Vou.No_
Claim No. 1930721 (2) Washington, April 11,1949
Pine Mountain Lumber Company, Inc., Ellaville, Georgia
I CERTIFY there is due from the United States to the above-named claimant(s), payable from the appropriation (s) indicated, the sum of_TWO THOUSAND SIX HUNDRED FOUR AND 56/100_ Dollars ($2,604.56)
on account of 56,307 feet of lumber furnished the Naval Air Station, Jacksonville, Florida, under contract No. W-09-026-eng-(MPS)-10448 dated June 26, 1947. Payee’s invoices Nos. 3352, 3353, and 3354 dated July 26, 1947 and July 28, 1947. (Navy Central Disbursing Office Voucher No. 121494)
17X0806 Naval Stock Fund (.1) (51000 207)
The amount herein allowed, together with the amount allowed in settlement of claim No. 1930721(3), is applied in liquidation of the claimant’s indebtedness to the United States in the amount of $23,523.87 resulting from overpayment on D. O. vouchers (as indicated in settlement of claim No. 1930721(3)), from the appropriation “17X0806 Naval Stock Fund” (.1).
To: No payment for reason stated.
Comptroller General of the United States,. By V. A. Vogel.
CERTIFICATE OF SETTLEMENT
General Accounting Office
D. O. Vou. No_
Claim No. 1930721(3) Washington, April 11, 1949
Pine Mountain Lumber Company, Inc., Ellaville, Georgia
I CERTIFY there is due from the United States to the above-named claimant(s), payable from the appropriation (s) indicated, the sum of_TWENTY THOUSAND NINE HUNDRED NINETEEN AND 31/100_Dollars ($20,919.31)
on account of manufacturing lumber and crossties from timber cut on Camp Stewart Reservation, Hinesville, Georgia, under contract No. W-09-026-eng-(MPS) 10363, dated June 16, 1947, Payee’s invoices Nos. 1085, 1074,1975,1076, 1081,1082,1083, and 1084. (OCF No. 93035)
2170905 Engineer Service, Army, 1947 (701-970 P 970-13)
For credit to:
“17X0806 Naval Stock Fund”
(•1)
This action, together with action taken in settlement of claim No. 1930721(2), is taken to effect liquidation of claimant’s indebtedness to the United States totaling
(See attached sheet)
To: Accounting and Bookkeeping Division, G. A. O. FOR TRANSFER ONLY No payment for reason stated.
Comptroller General of the United States, By Y. A. Vogel.

CONCLUSION 03? LAW

Upon the foregoing findings of fact, which are made a part of the judgment herein, the court concludes as a matter of law that the plaintiff is entitled to recover, and it is therefore adjudged and ordered that it recover of and from the United States the sum of twenty-three thousand, five hundred twenty-three dollars and eighty-seven cents ($23,523.87).  