At this time enlisted men of the Army serving in Alaska were entitled to and were receiving 20 per cent increased pay for foreign service. If it had been the thought of Congress that the inhibition appearing in the third proviso of the act of March 2, 1901, had been repealed, such legislation was wholly unnecessary (save to make the appropriation), as under the general law and regulations relating to extra duty and extra-duty pay such men would have been allowed extra-duty pay if properly detailed, etc., notwithstanding they were entitled to and were receiving increased pay for foreign service. The view that the third proviso in the act of March 2, 1901, was not repealed by the act of June 30, 1902, is further strengthened by the fact that the administrative department has made no estimates for extra-duty pay in places where the enlisted men were entitled to and were receiving increased pay for foreign service. I may say further that this office is informed by the administrative department that it is the view there that the third proviso in the act of March 2, 1901, that enlisted men receiving or entitled to the 20 per cent increased pay for foreign service should not receive extra-duty pay is still in force, and that only the first proviso of the act of March 2, 1901, was amended or changed by the act of June 30, 1902, and as so amended or changed the third proviso of the act of March 2, 1901, is applicable to and goes along with it. Such also is my view of the law, and I am of the opinion, therefore, that the stoppage by the auditor was a proper one. Use of an ANNUAL APPROPRIATION FOR WORK IN THE ENSUING FISCAL YEAR. A balance obligated by a contract for a specific purpose and remaining in an annual appropriation at the end of the fiscal year owing to default of the contractor, remains available during the ensuing. fiscal year for such object within the limits and amounts defined in the original contract. The substitution of the next lowest bidder to complete the work is within the meaning of section 3690, Revised Statutes. The moneys received from the defaulting contractor should not be covered into the Treasury as miscellaneous receipts. Acting Comptroller Warwick to the Secretary of Commerce, August 24, 1914: "On June 12, 1914, bids were opened by the lighthouse inspector, Baltimore, Md., under an advertisement calling for proposals for constructing one lighter scow for use of working party in the repair and construction of aids to navigation, and the lowest bid received, that of Daniels & Meekins, of Wanchese, N. C., in the sum of $924, after being duly authorized, was accepted on June 19, 1914, payment to be made from the appropriation General expenses, Lighthouse Service, 1914.' The next lowest bid received was that of the Spedden Shipbuilding Co., of Baltimore, Md., in the sum of $1,200. "On July 13, 1914, Daniels & Meekins advised the lighthouse inspector that a mistake had been made in their bid and that they wished to be relieved of their contract. As a result of correspondence on the subject Daniels & Meekins have forwarded their check for $276, which represents the difference between the amount of their bid, $924, and that of the next lowest bidder, the Spedden Shipbuilding Co., $1,200, which company has signified its consent to carry out the terms of its proposal made in response to the advertisement referred to. The department has therefore declared the contract with Daniels & Meekins to be annulled and proposes to accept the bid of the Spedden Shipbulding Co. "In this connection I desire your decision on the following two questions: "1. Should the payment to the Spedden Shipbuilding Co., on the contract which the department now proposes to enter into, be made from the appropriation, 'General expenses, Lighthouse Service," for the fiscal year 1914 or 1915? Reference is here made to the decision of the Comptroller of the Treasury found in 9 Comptroller's Decisions, page 10. 2. What disposition should be made of the proceeds of the check of Daniels & Meekins? It was held in 16 Comptroller's Decisions, page 384, that amounts paid by bondsmen of defaulting contractors for damages sustained by the United States by reason of the default are not required to be covered into the Treasury as miscellaneous receipt. If the proceeds of the check in question may be treated in the same manner, should the amount of same be deposited to the credit of the appropriation, 'General expenses, Lighthouse Service,' for the fiscal year 1914 or 1915? "Another case similar to the above is also under consideration by this department. On June 3, 1914, a contract was entered into with Johnston & Virden, of Lewes, Del., in the sum of $12,500, for raising light vessel No. 82, which was sunk in Lake Erie, payment to be made from the appropriation, 'General expenses, Lighthouse Service, 1914.' The department holds a certified check of this firm in the sum of $1,250 as security for its performance of the contract. The contractors commenced operations, but later declared their inability to carry out the work and their intention to abandon it. It will therefore be necessary to enter into a contract with a different party, and the question arises as to whether the appropriation intended to be used under the contract with Johnston & Virden, viz, 'General expenses, Lighthouse Service, 1914,' is available to pay for such new contract. Also as to the disposition to make of the certified check referred to. Your decision on these questions is desired." The questions presented will be treated in the order in which they ere stated. 1. The 1914 appropriation is available for proper payments to the Spedden Shipbuilding Co. under the conditions mentioned. The work of construction seems to have been properly advertised for and a contract entered into with the lowest bidder binding said appro priation for the object contemplated. The default of the contractor did not defeat the use of the appropriation for the object contracted for. The appropriation is still available for such object within the limits and amount defined in the original contract and the substitution of the next lowest bidder to complete the work under these circumstances comes within the meaning of section 3690, Revised Statutes. (14 Comp. Dec., 733–740.) 2. The moneys received from the defaulting contractor in this case are not money for the use of the United States within the meaning of section 3617, Revised Statutes, and are not required to be covered into the Treasurey as miscellaneous receipts. They are moneys received to make good the appropriation which will be damaged by awarding the contract to a higher bidder and should therefore be deposited to the credit of the 1914 appropriation from which the payments will be made. You also request my decision on the same question as applied to the case of Johnston & Virden, now under consideration by your department. The facts and conditions in that case seem to differ somewhat from those above disclosed in the Daniels & Meekins case and the decision of the questions submitted depends largely upon the provisions of the contract and the peculiar conditions existing in regard thereto. In the absence of any information as to the provisions of the contract and the basis and consideration upon which a new contract is contemplated to be based, I am unable to advise you definitely as to the disposition of the certified check in question. But for your information your attention is invited to 14 Comptroller's Decisions, page 496. As to whether the 1914 appropriation is available for such new contract, you are advised that any part of the consideration of the old contract which failed of use owing to the default of the con tractor is still available and, if sufficient, may be used in carrying out the object of such original contract. POST EXCHANGE, INDEBTEDNESS OF A SOLDIER TO. In case of a deserter (as well as in case of a discharged or a deceased soldier) who is shown to be justly indebted to the post exchange, a stoppage not exceeding the amount of credit authorized in the regulations may be lawfully made in favor of the post exchange. The decision of April 22, 1902 (21 MS. Comp. Dec., 324), is overruled. Decision by Acting Comptroller Warwick, August 24, 1914: William F. Herringshaw, captain and quartermaster, Thirteenth United States Cavalry, commanding a detachment of Quartermaster Corps at Columbus, N. Mex., as officer in charge of detachment fund. appealed, August 10, 1914, from the action of the Auditor for the War Department in settlement No. 252664, dated July 31, 1914. In papers of his claim, filed July 1, 1914, he declared that James M. Taylor, a first-class private in said detachment, deserted June 12, 1914, and at that time was a debtor to the post exchange in the sum of $6, which was charged on the pay rolls of the detachment for June, 1914, and was paid from the detachment funds to the post exchange; and he contended that said sum of $6 should be deducted from pay due said soldier at time of desertion and sent to the officer in charge of detachment fund. The War Department has reported that James M. Taylor, who had served as an enlisted man in the Fourth United States Infantry from June 26, 1902, to June 25, 1905, and from July 27, 1905, to November 17, 1910, enlisted, September 1, 1913, as a first-class private in Quartermaster Corps, deserted June 12, 1914, and is a deserter at large. By settlement No. 252664, dated July 31, 1914, the auditor disallowed the claim, as follows: "The soldier deserted June 12, 1914, and never returned. All pay and allowances due at date of desertion are forfeited by law to the United States and are not subject to the soldier's indebtedness to the post exchange." Appellant states that he has previously collected amounts of this nature where a sufficient balance was left in the accounts of the deserter after all claims of the United States had been covered. Paragraphs 1424, 1425, 2012, and 2013, Digest of Opinions of Judge Advocates General of the Army (published in 1901), are as follows: * "1424. The company, hospital, and similar funds, not being public money, it was formerly held that stoppages of pay of officers and soldiers could not be made to reimburse these funds * * ; but as the post-exchange fund has been recognized as an agency or instrumentality of the Government (34 C. Cls., 468), and in view of the reasons upon which such conclusion rests, held that stoppages may legally be made to reimburse post-exchange, company, bakery, hospital, and regimental funds. "1425. Where a retired enlisted retired enlisted man embezzled $240, postexchange funds, held, in view of the fact that such funds are recognized as an instrumentality of the Government, that his pay could legally be stopped to reimburse those funds." * * 2012. When the post exchange (then called canteen) was of a private character it was held that stoppages of pay could not be made to reimburse losses of canteen funds; Subsequently (in 1897) the Treasury Department held that post exchanges as then organized under the orders of the War Department were Government instrumentalities or agencies. * ** The funds of the post exchange are moneys used in carrying on this public agency, and the Government has a right to protect its instrumentalities, the estab lishments through which it carries on public business. Held, therefore, that stoppages against the pay of officers and enlisted men may legally be made to reimburse the post-exchange fund on account of losses for which such officers and enlisted men are responsible. "2013. The post exchange (formerly canteen) was not established by Congress, but is maintained under special regulations prepared by the War Department. It is recognized as a Government instrumentality, and has been recognized by Congress, by reference to it, in acts of June 13, 1890 (26 Stat., 154), and July 16, 1892 (27 Stat., 178)." Above opinions were concurred in by this office in decision of June 14, 1901, hereinafter quoted. By the acts of Congress which made appropriation for the support of the Army for the fiscal year ended June 30, 1903, and subsequent fiscal years up to June 30, 1914, beginning with the act of June 30, 1902 (32 Stat., 516), funds were appropriated "for the construction, equipment, and maintenance of suitable buildings at military posts and stations for the conduct of the post exchange, to be expended in the discretion and under the direction of the Secretary of War." In the act of April 23, 1904 (33 Stat., 270), and subsequent laws this Government instrumentality is designated "Military post exchange." * * * In a communication addressed to the Secretary of War June 14, 1901 (17 MS. Comp. Dec., 1381), relating to a proposed amendment of paragraph 325, Army Regulations of 1895, this office said: "In the case of Dugan decided June 5, 1899 (34 C. Cls., 458), the court held that inasmuch as the post exchange is established, maintained, and managed under special regulations prescribed by the Secretary of War, it becomes an agency or instrumentality of the Government of the United States *. I concur in the opinions of the Judge Advocate General of the Army and the Court of Claims, and for the reasons which are fully and clearly set forth in both, I decide that in case of a soldier who is shown to be justly indebted to the post exchange, stoppage of his pay, not to exceed the amount of credit authorized in the regulations governing the exchange, may be legally made by the paymaster, and the amount so stopped turned over to the proper exchange officer. Paymasters making payments in accordance with the proposed amendment to paragraph 325 of the Army Regulations will receive credit for same in the auditing of their accounts. I think the proposed plan of having the exchange officer receipt to the paymaster and to the soldier for the amount turned over to him is wise and prudent." In accordance with the above decision the War Department amended said paragraph 325 and it now forms paragraph 345, Army Regulations of 1913, worded as follows: "345. Post exchanges are established and maintained under special regulations issued by the War Department. The amount of indebtedness of a soldier to a post exchange contracted in accordance |