1. CECISION nit ~%r~wt:: Alan Belkin

! 4,;> ~~~~TH{E COMPTROLLER OENERAL| n~~ECSIBlnN ||-,# Jor THE UNITED STATE9

i.> WAU HI N aCT urJ, D.c. 2054

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| D GoFILE: 3-183784 DATE: Jauu7 24, 19T

MATTER OF: Request for reconsideration of decision B-183784,January 23, 1976, involving National Housing Actmobile home loan insurance

DIGEST:1.. As stated in 8-183784, January 23, 1976, claims under

mobile home loan insurance pursuant to 12 U.S.C.- ~~~§ 1703 by lending institution presently delinquent in

insurance premium payments may be allowed if defaultin loan occurred while premium payments were current.however, in accoL. ce with applicable regulations,

lender it required to continue to pay insurancepremiuns up to date claim is filed with HUD ratherthan date of default, and set-off of this amountagainst allowable claims ts appropriate. B-183724, supra,( ii clarified.

2. Although payment of insurance premiums in advance isrequirel in order to maintain ongoing effective in-surance Loverage for mobtle home loan insurance under12 U.S.C. § 1703, payment of insurance premiums con-stitutes continuing obligation of lender that cannotbe termInated prior to end of term of underlying loan.HUD has authority to set-off delinquent unpaid in-Iurance pzemiums constituting existing dolt presentlydue and 0Ayatle to United States by lender againstclaims otherwise payable to lender, pending bankruptcyadjudication as to propriety of final setoff but maynot withhold estimated future premiums. 3-183784,January 23, 1976, is modified accerdingly.

This decision is in response to two separate requests from officialsof the Department of Housing and Urban Development (HUD) for our further.views with reappc:t to our decision B-183784, dated January 23, 1976, non-cerning the payment of insurance premiums, and the legal rarmiftcationsof delinquencies in insurance premium payments, with respect to mobilehome loans issued under section 2, title 1, of the National Housing Act,as amended, 12 U.S.C. § 1703 (1970). Since the re- fsts are closelyrelated, essentially constituting requests for ref :deration and/orclarification of our decision of January 23, 1976, we will combih2 ourresponses into one decision. However, for reasons of clarity, each requestwill be dealt with separately herein.

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In our January 23 decision we held that timely payment of requiredpremiums is a prerequisite to insurance coverage for mobile home loansunder 12 U.S.C. 5 1703 and the implrennting regulations. Accordingly,we concluded that HUD could not bonor insurance claims with respect towhich premium payments were not current either at the time of loandefault or at a time when the lender had reason tc believe that loandefault was imminent. With respect to the collection of unpaid insur-ance premiums, we said that past due premium charges may be set-offagainst otherwise allowable claims if the lending institution agreesto such an action or, alternatively, that all remaining insurancecoverage for the lender should be cancelled for non-payment of therequired premiums. We indicated, however, that in neither eventwould the set-off of future premiums be appropriate. Finally. werecommended that the Secretary of HUD consider amending the currentHUD regulations in orcer to avoid any recurrence of this situation bysetting out the legal effect of a failure by an insured lendinginstitution to pay the required insurance premiums in advance, asrequired by the statute.

In the initial request for reconsideration of this decision fromMr. John W. Kopecky, HUD Assistant General Counsel, the question wasratsed as to "* * * whether the Secretary is autho:ized to providethat an insured may ?terminwte' insurance ccvaragk simply by failingto remit insurance premiums when due * * *." This issue will befully discussed in the latter portion of this decision.

Subsequently, we received a letter from Mr. B. C. Tyner, AuthorizedCertifying Officer, BUD, requesting our advice as to the propriety ofcertifying a voucher presented to him in the amount of $2,934.02covering a claim by the First Colonial Life Insurance Company, the samelender that was involved in the original decision. The voucher coversa claim on a loan made by First Colonial on June 1, 1972, for thepurchase of a mobile home. The loan was made and submitted to HUD forinsurance in accordance with 12 U.S.C. S 1703 and regulations issuedpursuant thereto, 24 C.F.R. 55 201.501 et seq. (1976).

Aa explained in the certifying officer's letter to us, thepremium on the loan was current at the time of default by the borroweron September 1, 1973, but was delinquent and unpaid when the claim wasactually filed by the insured lender on October 25, 1974. According tothe submission, the instant question as tr the propriety of honoringthis claim has arisen as a result of what we said in the followingparagraph from our decision of June 23, 1976:

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"Turning to the specific c..aim a:companying theinstant submission, as noted previously, defaultoccuxred (June 1, 1973) well before the lenderbecame delinquent in its premium payments(September 1, 1974), even though the claim wasartually filed (September 20, 1974) after thefirst nonpayment rof premiums. Accordingly,this particular loan was covered by insuranceat the time of default, and way be honored ifotherwise proper. The certifylt officer's sub-miusian to us does not desecibv the precisetiming of the other pending claims by FirtcColonial, which should, of course, be disposednf in a'cordance with the conclusions expressedherein."

The cezLIfying officer who submitted this question to us apparentlybaie;ed that this lsaguage necessarily conflicted with the applicableregulations act fort' i'r -24 C.F.R. 6 201.f640, which have been con-sistently interpre ted by HUD as requiring that an insured lender con--tioue to p,, insuiarae premiums up co the dare of claim without regardto whether the loan in question ves current or in default. In ourJanuary 23 decision we were primarily concerned with the question ofwhether insurance coverage could remain in effect where the lendinginstitution failed to pay its insurance premium "in advance" as re-quired by the stature. We determined that payment of the requiredpremiums "in advance," albeit on an annual basis (as prescribed bythe regulations), was a prerequisite to continued insurance coverage.Accordingly, we concluded that claims could only be allowed for thoseloans that went into default while premium payments ware still current,but would have to be disallowed when the default occurred or becameimminent at some time after the premium delinquency arose. Thus, thelanguage from that diecision which was specifically quoted in thecertifying officer's submission actually stands for the propositionthat the particular claim involved there could be honored even thoughit was actually filed after the first nonpayment of premiums sincethe underlying loan was covered at the time the default that led tothe claim occurred.

The certifying officer's primary concern is that the lender shouldbe required to continue to pay insurance premiums up to the date the

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claim is filed rathet than the date of default. We do not disagreewith this conclusion. The applicable regulatory provisions, setforth at 24 C.F.R. 1 201.640, provide as follows:

"Refund or Abatement of Insurance Ch- .L

"An insured shall be entitled to a refund orabatement of insurance charges only in thefollowing instances:

(a) Where the obligation has bean refinanced, theunearned portion of the charge on the originalobligation shall be credited to the charge onthe refinanced loan.

(b) Where the obligation is prepaid in full or aninsurance claim is filed, charges falling dueafter such prepayment or claim shall be abated.

(c) Where a loan (or a portion thereof) is foundto be ineligible for insurance, charges paidon the ineligible portion shall be refunded.Such refund shall be made, however, only if aclaim is denied by the Commissioner or theineligibility is reported by the insuredpromptly upon discovery. In no event shall acharge be refunded on the basis of loanineligibility where the application for refundis made after the loan has been paid in full."

In our prior decision, we noted that since this provision providesthat insurance premiums falling due after the filing of an insuranceclaim are abated, "there would be no past due premiums to set-off enloans which went into default while premium payments were current andfor which insurance claims are now pending with HUD." We dif notintend to sugjest that an insured lending institution was relievedof ite obligation to continue to pay insurance premiums in the .ervalbetween the date of default and the date the claim was filed. Webelieve that the meaning of 24 C.F.R. 1 201.640 is clear, i.e., thatonly the filing of an insurance claim with HITd, rather than the maredefault by the borrower, abates premium charges. However, where premicpayments are current at the time of detoil t, we do not believe that

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nonpayment of premiums after default but before filing of a claimdefeats the validity of the claim itself. See-43 Am. Ju7. 2d,Insurance, 1 621, at 629-630, which states the general rule that:

"* * * If the premium or assessment is notdue until after a loss has occurred, failure tomake payment thereof does not work, K forfeitureof the policy."

In view of the foregoing, the proper procedura to follow for aclaim such as the one here presented by the certifying officer is tohonor the claim but set off against it unpaid premiums attributableto that, claim arising between default and the date of filing of theclaim, pursuant to the Government's customary right of let-off. Seee.t., 41 Comp. Gen. 178 (1961); 28 id. 543 (1949), and cases cited.Accordingly, the voucher presented may be paid, if otherI.f;e crrrect,upon set-off of the appropriate premium amounts. Our dectsion ofJanuary 23, 1976, supra, is hereby clarified to the extent that itmight be read to suggest a contrary result.

Finally, we note that although it appears on the basis of theoriginal submission from HUD that First Colonial was and apparentlystill is involved in a bankruptcy proceeding (we have no preciseinformation as to First Colonial's current status), we do not believethat this significantly affects the Government's right of set-off.It this regard 11 U.S.C. 5 108(a)(1910) specifically provides that"in all cases of mutual debts or mutual credits between the estateof a bankrupt and a creditor the account shall be stated and one debtshall be set off agnirst the other, and the balance only shall beallowed or paid." Although this section has been held not to be salf-executing, we beli'.ge that HoD would certainly have the right beforepaying any clarm to withhold an amount equivalent to all unpaid premiumsdue from a lender between the date of default and the date the claimis filed, pending an adjudication by the bankruptcy court as to thepropriety of a final set-off of this amount.

Turning to the request from Mr. Kopecky, a different issue,although one that is related to the certifying officer's request, isinvolved. The certifying officer was primarily concerned with theinsured's legal obligation to continue to pay insurance premiums ondefaulted loans until such time as claims thereon are actually filed.Mr. Kopecky's submission, on the oTher hand, suggests that lendinginstitutions should not be permitted to unilaterally terminate their

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insurance coverage and their reciprocal obligation to continue to payinsurance premiums on loans that have not gone into default merelyby failing to pay such premiums as they become due even when the realpossibility exists that no additional insurance coverage will beforthcoming and any new claims could not, therefore, ba honored. Asstated in our decision of January 23, 1976, that posasbility existsbecause of the statutory limitation in 12 U.S.C. I 1703(a) thatinsurance granted to a lending institution thereunder not exceed10 percent of its eligible loans. To implement this provision, HUDregulations provide for the establishment of a general insurancereserve for each lender which is designed to maintain the amount ofa lender's reserve at 10 percent of its outstanding loan balance,less claims approved for payment. See 24 C.F.R. If 201.12 and 201.675 (1976). We have informally been advised that the total amountof all claims from First Colonial presently pending with HMUD mayexceed the 10 percent insurance reserve, in which case no additional.insurance protection from MUD would be available.

As explained above, our decision of January 23, 1976, wagprimarily concerned with the issue of whether an insured loan wouldretain its insured status even if the lending institution did notcontinue to pay its insurance premiums "in advance" as required by12 U.S.C. I 1703(f). We held that the purpose of the statutory re-quirement for advance payment of insurance premiums was to preventthe insured from being protected by insurance for which he has notpaid. We therefore concluded that any loans that went into defaultafter the premium delinquency arose were not covered by insurance.HUD does not disagree with this conclusion. Thus, in its letter tous of May 5, 1976, responding to a request for additional clarificationof its views in this regard HUD took the following position:

"The Title I Regulations make no provisionfor voluntary termination of insurance coverageor for a termination charge. In the event of afailure of an insured lande. to timely iemitinsurance charges when due it would, however, beour view that insurance coverage would lapse,and the Secretary would not be obligated tohonor a claim where the insurance charge for theloan had not been paid. Under such circumstances,of course, it would be difficult to continue topress the insured lender for payment of the unpaidinsurance charges.* * *"

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However, our January 23 decision also held, at least implicitly,that any lender had the general option of deciding whether 'or not tocontinue its insurance coverage a&d that therefore it would not beproper to setroff past due premiums attributable to loans not yet indefault without First Colonial's consent since continued insurancecoverage might not be desired. It is this portion of our decisionthat has been questioned by HUD. Upon consideration of this specificissue, we agree that insured lending institutions are legallyobligated to continue to pay insurance premiums over the full termof insured loans, and cannot unilaterally terminate their insurancecoverage rimply by failing to remit insurance premiums when due.Accordingly, unpaid insurance premiums can be set off againstallowable claims without the consent of the lending institutioninvolved. The basis for our conclusion in this regard is set forthhereafter.

The relevant statutory provision with respect to the payment ofinsurance premiums for mobtile home loan insurance is contained in12 U.S.C. 5 1703(f) as follows:

"The Secretary shall fix a premium charge forthe insurance hereafter granted under thissection, but in the case of any obligationrepresenting any loan, advance of credit, orpurchase, such premium charge shall not exceedan amount equivalent to 1 per centum per annumof the net proceeds of such loan, advance, orpurchase, for the term of such obligation, andsuch premium charge shall be payable in advanceby the financial institution and shall be paidat such time and in such manner as may beprescribed by the Secretary."(Emphasis. added.)

HUD believes that this provision requires lending institutions tocontinue to pay insurance premium charges over the full term of insuredobligations, and does not allow lenders to terminate their insurancecoverage and their reciprocal obligation to continue to pay suchpremiums until the obligation has matured, been prepaid, or until aclaim thereon has been filed. See 24 C.F.R. 1 201.640 (1976), supra.The basis for abating premium charges falling due after a loan hasbeen prepaid or a claim has been filed, as explained in HUD'3 clarifyingletter to us of May 5, 1976, is that in both cases the term of the

2-183784

obligation would have ended either because .f the prepayment or byreason of the acceleration of the note upou its default. Moreover,HUD'a view with respect to the Title I insurance program, asexplained in its letter to us of May 5, 1976 "is that the entireinsurance premium is due when a loan is accepted for insurance butthat the premium may be payable in installments . c.'nsurate withthe terms of the obligation." See 24 C.F.R. S 2O1.. 10(a) and (b)(1976).

Although we believe that, standing alone, 12 U.S.C. S 1703(f)is somewhat ambiguous and is susceptible to other interpretations,we also believe that any doubt as to the intended meaning of thisprovision is removed upon consideration of another provision ofthe National Housing Act, 12 U.S.C. I 1715(t)(1970), which providesas follows:

"Voluntary termination of insurance.

Notwithstanding any other provision of the Actand with respect to any loan or mortgage here-tofor or hereafter insured tinder this Act,except under Section 1703 of this title, theSecretary is authorized to terminate any in.-surance contract upon requtet by the borroweror mortgagor and upon payment of such terminationcharge as the Secretary determines to be equitable,taking into consideration the necessity of pro-tecting the various insurance funds.

Upon such termination, borrowers and martgagorsand financial institutions and mortgagees shallbe entitled to the rights, if any, to which theywould be entitled under this Act if the insurancecontract were terminated by payment in full ofthe insured loan or mortgage."(Emphasis added.)

BUD relies quite heavily upon this provision in support of its positionthat lenders under section 1703 cannot unilaterally terminate theirinsurance merely by discontinuing premium payments. We agree with HUD'sposition. The clear implication of this specific provision fortermination is that, once a loan is submitted and accepted for insuranceunder section 1703, neither the Secretary of HUD nor the insured lender

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can terminate such insurarce tither unilaterally or by mutual agree-gent until the term of the obligation has expired. Certainly, itwould be anomalous to concludL that this provision only refers tothe voluntary, mutually agreed upon t.rmination of insurance, butJoes not restrict a lender's right to unilaterally terminate itsInsurance coverage by discontinuing further premium payments as theybecome due.

Although our review of the legislative history of 12 U.S.C.5 1703 does not reveal any information that would be helpful inresolving the issue under consideration here, our examination ofthe legislative history of 12 U.S.C. I 1715(t), when it was firstenacted as section 612(fl of Pub. L. No. 87-70, approved June 30, 1961,definitely supports the view that insurance under section 1703 cannotbe terminated prior to the expiration of the term of the obligationsinvolved. The report of the Senate Committee on Banking and Currtra'.you this legislation explains the purpose of this provision as follows:

"Voluntary termination of FRA insurance onmultifamily housing mortgages and loans.

Section 509(k) would permit voluntary ter-mination of FHA insurance of a loan or mortgagecovering multifamily housing project. The in-surance could be terminated if the borrower andthe lender both make the request. The Com-missioner has authority to impose terminationcharges in such zases. The new programs whichwould be authorized by the bill would be includedunder the provision. Under present law FHA hasthis authority only with respect to one- to four-family home mortgages. FHA insurance cannot nowbe terminated on a loan covering a multifamilystructure unless the mortgage is prepaid."S. Rep. No. 281, 87th Cong., 1st Sess., 40 (1961).(Emphasis added.)

As this explanation indicates, insurance issued under the NationalHousing Act, as amended, cannot be voluntarily terminated unless a pro-vision such as that contained in 12 U.S.C. 5 1715(t) is applicablethereto. It follows that since this provision expressly provides thatit does not apply to insurance issued under 12 U.S.C. 5 1703, such in-surance cannot be terminated voluntarily or otherwise, for purposes ofpremium payments, prior to the end of the term of the obligations involved.

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Although this result may seem harsh, especially in a situationwhere the lending institution may be required to continue to paypremiums even though the 10 percent insurance reserve becomesexhaustad and no additional insurance protection will be providedby BUD, we believe that there are additional reasons for reachingthis conclub-on. For one thing, it appears that the Title Iinsurance program is self-supporting and that premium income has beensufficient to cover both losses and operating expenses under theprogram. See S. Rep. No. 281, supra, 40. It is reasonable to assumethat the self-sufficiency of this program is predicered on thestatutory arrangemenc that lending institutione must pay a premiumwhich is based on all of the loans submitted for insurance, eventhough the insured can only collect on a maximum of 10 percent ofthat total. Of course; this statutory arrangement can only beeffective if lending institutions are not allowed, orics a loan is

ubdmitted and accepted for issuance, to terminate the insurancethereon. The statutory arrangement, as well as the program's self-sufficiency, might be defeated if a lending institution was permittedto stop paying premiums after the 10 perLent figure is reached andthe insurance reserve is exhausted. In this regard we should pointout that 12 C.F.R. r 201.640, supra, which sets forth the only cir-cumstaices in which refunds or abatements of premium charges arepermissible does not include unilateral, or, for that matter, themutual, termination of insurance coverage or the exhaustion of theinsurance reserve.

Also, in its letter of Hay 5, 1976, HUD said the followirgin this regard:

"* * * the fact that the statutory lia-bility of the Secretary to honor claims mayhave ended by reason of exhaustion of the in-surance reserve would not necessarily dictatethat the insured lender's obligation to continueto pay insurance installments has also ended.Instances have arisen involving similarsituations where a bank has been declared insol-vent and the insurance reserve exhausted. Insuch cases the insuring agency (FDIC, FSLIC,etc.) has arranged with the succeeding financialinstitution to pay the insurance installments tothe Secretary on loans previously acknowledgedfor insurance by the Sacretary even though therewas no possibility at future claims befeq honoredby the Secretary."

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A-18374

We have found judicial precedent for this position. Section 407(a)of Lde National Housing Act, I2 U.S.C. I 1730, at one time requiredany saving5 and loan asaociatiop, that wished to terminate itsdeposit insurance with the Fdederal. Savings and Loan Insurance Cor-poration to cantinue to pay the premium, charges for such insurance"for a period of three years after the date of such termination* * *." Section 407(a) also provided that once an insured insti-tution so terminates its tnsnvcd status, its accounts were no longercovered by insurance. In the case of Federal SsvinRs and Loan In-aurar'.±e Corporatiao v. Edison Savings and iin Association, 83 F.Supp. 1007 (S.D. fN.Y.) (1949) this provision has attacked on thefollowing grounds:

"* * * the failure to fuEnish io3uranlcecoverage for premiums allegedly due makesthe contract void and itenforcible forwant of co)nsideration; sirtze the plaintiffassumes -o risk iL is not lawfully entitledto premiums; sir.ze the plainfiff, afterdemand, refused to give insurance coveragethe defaa1daLt is now reLieved of any obli-gation to pay premiuws; Piia',e the e .fendaritceased to be an insured Irstitution itceased to have any irvared accounts uponwhich a premium could be; computed underSection 404(a) of the Act, 12 U.S.C.A.f 1727(a); to require defendant to paypremiums without atfcordtnLc it coverage wouldbe to deprive the defendant, its membersand shareholders of property without justcompensation and without due process inviolation of Article V of tbe Amendmentsto the Constitution of the United States."

After considering and rejecting each of these arguments in turn, thecourt concluded that the statutory requir-ment,however burdensome,was clear and unambiguous and did in fact require the lending insti-tutions to continue to pay the required insurance premiums, althoughno additional Insurance coverage was available. Also, in this regardsee Federal Savig mnd Loan ZIsurance Corporation vA Grand ForksBuilding and Loan Assrciatloa, 85 F. Supp. 248 (D. N.D. 1949).

B-183784

We believe that the same principle enunciated in the above-cited case is applicable here. Reading 12 U.S.C. If 1703(f) and1715(t) together, as well as the legislative ?..:tory of the latterprovision, the congressional intent becomes clear that once aloan is accepted for insurance under 12 U.S.C. 9 1703, the lendermust continue to pay premiums until the term of the loan has endedeven if the loan is no longer covered by insurance.

In accordance with the foregoing, and notwithstanding anythingto the conrrary in our decision of January 23, 1976, we now believethat payment of the insurance premiums on loans insured under12 U.S.C. 5 1703 constitutes a continuing obligation of a par-ticipating lending institution that cannot be terminated prior tothe end of the term of the underlying loans ant must,therefore, bepaid by the lender as such premiums become due regardless of possibleexhaustion of the insurance reserve. However, we continue to believefor the reasons stated in our decision of January 23, 1976, that pay-mant of such premiums in advance is required in order to maintainactive, ongoing insurance coverage. Therefore, claims cannot be. -

honored if the default in the insured loan occurred after the premiumdelinquency arose.

Having reached this conclusion, we are faced with the questionof bow best to proceed in the instant case to effect a collection ofthe unpaid premiums. As stated in 41 Comp. Gen. 178 and 28 id. 543,supra, it has consistently been held that the Government has the sameright of set off as do other creditors. Accordingly, we believe that,HUD has the authority to set off delinquent unpaid insurance premiumsconstituting an existing debt presently due and payable to theUnited States by First Colonial against allowed insurance claimspayable by HUD to First Colonial. However, this set off would notinclude amounts attributable to loans which went into default whilepremium payments therefor were not current since such loans haveceased to be eligible for insurance. Cf., 24 C.F.R. I 201.640(c),supra.

As stated above, we do not believe that the fact of firstColonial's involvement in a bankruptcy proceeding significantly affectsthe Government's right of set-off in this regard, atnce 11 U.S.C.I 108 specifically provides for the set-off of mutual debts by anycreditor in such a situation. Although that section is not selt--executing, we believe that prior to paying any claims HUD would bejustified in withholding an amount equivalent to the total of alldelinquent premiums that are due and owing as of the date the claimsare to be paid pending an adjudication by the appropriate court or thetrustee in bankruptcy as to the propriety of a final set-off.

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B-133784

The situation with respect to th;. payment of premiums that willbecome due in the future is different however. In light of our con-clusion that payment of the insurance premium pursuant to 24 C.F.R.§ 201.630(bi constitutes a continuing obligation of the lender thatcannot be terminated prior to the end of the loan term, we believethat the unpaid insurance premium which will become due in Lhe futurecan ba likened to an unmatured debt which is owing but has not yetbecome due. The general rule with respect to the set-off of unmatureddebts is stated in pertinent part as follows in 20 Am. Jur. 2d,Counter:claims, Recoupment, arn. Setoff § 57:

"Centrally, a claim or demand of adefendant against the plaintiff must be dueand owing at the commencement of the actionin order to be available as a setoff orcounterclaim.. The basis of the general ruleis the principle that all issues in an actionare to be determined as of its date ofcommencement. To allow a debt not due to beset off against one already due would be tochange the contract and advance the time ofpayment. In other words, the general statutesof setoff and counterclaim apply to mutualdebts only and do not comprehend mutual credits.Mutual debts, in the purview of a statute ofsetoff, are not merely those which are owing,but those which are due and payable, on eachof which the cause of action has accrued andexists at the same time, while they are mutualcredits if either remains to be paid at afuture day."

It is generally held thst set-off is only appropriate when the debtinvolved is liquidated and certain in amount. See 20 Am. Jur. 2d,Counterclaims, Recoupmenzt, and Setoff § 61. However, it is possiblethat some loans may go into default or be paid in full before their term(as fixed in the loan agreement) is ended, thus reducing--under theabatement provisions of 12 C.F.'R. § 201.640--the amount of insurancepremiums that would become due in the future. Thus there is presentlyno debt for future premiums which is certain in amount. Accordingly,althougi it is our view that the lender's obligation to pay insurancepremiums is a continuing one, we do not believe that it would be properfor HUD to set-off estimated premiums that might become due in the futurea*ainst claims by First Colonial that are currently payable.

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Af 'stated above, to the extent that anythinS in our decisionB-183784, January 23, 1976, is inconsistent with what we have saidherein, the previous decision is modified accordingly.

Deputy ptroller Generalof the United States

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