Board of Contract Appeals
                 General Services Administration
                      Washington, D.C. 20405



                                                 

                         January 9, 2006
                                                 


                         GSBCA 16753-RELO


                 In the Matter of GREGORY A. TATE


     Gregory A. Tate, Havertown, PA, Claimant.

     JoAnne Rountree, Supervisor, Travel Section, Department of Veterans Affairs
Financial Services Center, Austin, TX, appearing for Department of Veterans Affairs.

DANIELS, Board Judge (Chairman).

     Following his May 2005 transfer to Pennsylvania, Department of Veterans Affairs
(VA) employee Gregory A. Tate purchased a residence there.  The agency reimbursed Mr.
Tate for most of the costs he incurred in buying this house.  It declined to reimburse him for
the cost of title insurance, however.  Mr. Tate asks us to review the agency's determination
as to the title insurance premium.

     The Federal Travel Regulation (FTR) contains three provisions regarding
reimbursement of title insurance premiums.  A "[m]ortgage title insurance policy, paid by
[the transferred employee], on a residence [the employee] purchased for the protection of,
and required by, the lender" is reimbursable if it is customarily paid by the purchaser of a
residence at the location in question.  41 CFR 302-11.200(f)(8) (2004).  An "[o]wner's title
insurance policy" is generally not reimbursable.  Id. 302-11.202(c).  Such a policy is
reimbursable, however, if it is customarily paid by the purchaser of a residence at the location
in question and if "it is a prerequisite to financing or the transfer of the property; or if the cost
of the . . . policy is inseparable from the cost of other insurance which is a prerequisite."  Id. 

     The settlement sheet for Mr. Tate's home purchase shows a single line regarding title
insurance.  The sheet does not state whether the insurance secured through this payment was
required by the lender of his mortgage loan, for the benefit of the purchaser, or both.

     The VA, focusing on the second of the FTR provisions cited above, decided that
because some of the premium may have covered title insurance for the benefit of the owner,
none of that cost should be reimbursed.  The agency ignored the third provision, however. 
That provision makes clear that in certain circumstances, title insurance premiums are
reimbursable even if the insurance purchased is for the benefit of the owner.  One of these
circumstances is "if the cost of the . . . policy is inseparable from the cost of other insurance
which is a prerequisite [to financing or the transfer of the property]."  The transfer agent has
supplied us with a letter which confirms what Mr. Tate had been telling the VA: in the
Commonwealth of Pennsylvania, title insurance premiums are "all inclusive"   they "include
simultaneous issue of Owner & Lender Policies at a one time fee."  Thus, Mr. Tate could not
have purchased title insurance for the benefit of the lender alone.  The cost of whatever
insurance coverage he received as owner was inseparable from the cost of the insurance
coverage which was required by the lender.

     The title insurance premium paid by Mr. Tate is required by the FTR to be reimbursed
to him by the VA.






                                   _________________________ 
                                   STEPHEN M. DANIELS
                                   Board Judge