Steam engineers in the District of Columbia.....

Supervising examiners of the Bureau of Pensions

Sureties for the performance of contracts

Surplus graduates of the Naval Academy

25

327

57

358

OPINIONS

OF

HON. AUGUSTUS H. GARLAND, OF ARKANSAS.

APPOINTED MARCH 6, 1885.

ACCRUED PENSIONS.

The terms "accrued pensions," as used in section 4718, Revised Statutes, mean the amount of money unpaid by the Government to which a pensioner, or a person who had a valid claim for pension pending, was entitled at the time of his death.

The receipt by a pensioner of a check for the amount due him on his pension, which was indorsed but not transferred by him in his life-time, is not payment. The amount so due is accordingly "accrued pension," and is payable to those only who are entitled thereto under such section.

DEPARTMENT OF JUSTICE,

April 16, 1887.

SIR: By your letter of the 12th of April, 1887, you request my opinion "upon the question as to when, under the provisions of section 4718, Revised Statutes, payment of pension to a pensioner is so completed that the amount due by way of pension becomes assets and ceases to be accrued pension."

The question with reference to the usual mode of paying pensions is more fully stated in the communication of the Commissioner of Pensions in his letter to you of the 11th of April, 1887, transmitted with yours, as follows: "Whether or not, under the provisions of section 4718 of the Revised Statutes of the United States, where a check has been transmitted by a pension agent through the mails to a pensioner and received by him, and thereafter, whether the pensioner dies having indorsed and not negotiated the check, or dies without having indorsed the check but having the same in his possession, payment is so completed, and title to the amount called for by the check so vested in the pensioner, that the 274-VOL XIX—1

1

Accrue Pensions.

check can properly be considered part of the assets of the decedent, and as such assets collected by his legal representatives and the proceeds be subject to the payment of the debts of the deceased."

The phrase accrued pension," as used in this section, means the amount of money unpaid by the Government to which apeirsioner, or one who had a valid pending claim for pension, would be entitled at the time of his death. The statite declares, first, this unpaid money shall be paid to the widow of the pensioner if he leaves one; second, if there be no widow, it shall be paid to his child or children under sixteen years of age; if he leave no widow or child or children under sixteen years of age it shall not be paid at all, "except so much as may be necessary to reimburse the person who bore the expenses of the last sickness or burial of the decedent, in case where he did not leave sufficient assets to meet such expenses." That the "accrued pension" shall be paid to no other than as above stated is strongly emphasized by the provision that "such accrued pension shall not be considered a part of the assets of the estate of the deceased nor liable to be applied to the debt of such estate in any case whatever, but shall inure to the sole and exclusive benefit of the widow or children; and if no widow or child survive, no payment whatsoever of the accrued pension shall be made or allowed." This clause imposes upon the officers of the Government the obligation to neither make nor allow to be made any payment of the "accrued pension" to the executors or administrators of the decedent for the general payment of debts or distribution, with the possible single exception that if they have borne the necessary expenses of his last sickness and burial and he shall have died without sufficient funds to re-imburse them, so much of the accrued pension may be paid them as they shall have paid for those purposes. In no event can they receive any part of the "accrued pension" merely as the legal representatives of the decedent.

Unless, then, the pension was paid to the decedent in his life-time and became a part of his general assets, it can not pass to his legal representatives so as to be subjected to the payment of the debts of the decedent. The question is thus reduced to, what is a payment to a pensioner in his life-time?

Accrued Pensions.

In the absence of special contract the presumption is that the payment of an obligation shall be made in money. This presumption applies to a pensioner as well as to any one else. Till be gets his money or that which in law is its equivalent, he is not paid nor is the Government discharged. If he receives a check but never transfers it nor gets the check cashed he has not received his money; for a "banker's check is not money" (Chitty on Bills, 399). If he receives a check and payment is refused he has no right of action against the bank. "The holder of a bank check can not sue the bank for refusing payment in the absence of proof that it was accepted by the bank or charged against the drawer."

The fact that the check was properly drawn on a national bank (a public depository) by an officer of the Government in payment of a public creditor does not alter this general rule, (Bank of Republic v. Millard, 10 Wall., 152). "The payee of a check before it is accepted by the drawee can not maintain an action upon it against the latter, as there is no privity of contract between them." So held, where a check of the Treasurer of the United States upon a national bank duly designated as a depository of the public money, having been paid upon an unauthorized indorsement of the name of the payee, suit to recover the amount of the check was brought by its true owner against the bank (First National Bank v. Whitman, 94 U. S., 343). A check, then, until presented, accepted, or marked good by the drawee, is only a personal obligation of the drawer. "When the United States by its unauthorized officer become a party to negotiable paper they have all the rights and incur all the responsibility of individ uals who are parties to such instruments. We know of no difference except that the United States can not be sued." (United States v. Bank of Metropolis, 15 Peters, 392; and United States v. State Bank, 96 U. S., 30.)

The United States, then, stands upon the same plane as others who issue negotiable paper, except that the United States can not be sued. The general rule is, if a debtor give his creditor his own promissory note or obligation of no higher order than the original debt, the debt is not thereby paid nor the debtor discharged (Peter v. Beverly, 10 Peters, 567; James v. Hackly, 16 Johns, 277). It is stated by Kent,