Case No. RF300-20047
May 14, 1997
DECISION AND ORDER
OF THE DEPARTMENT OF ENERGY
Application for Refund
Names of Petitioners: Gulf Oil Corporation/Michael Herndon
Gulf Oil Corporation/Bruer Airland Gulf
Date of Filings: April 28, 1997
Case Numbers: RF300-20047
RF300-20048
This Decision and Order renders a determination upon the merits of two Applications for Refund filed in the Gulf Oil Corporation special refund proceeding. The first, Case No. RF300-12317, was filed by Luko Bruer of Bruer Airland Gulf (Bruer Gulf) and granted on May 21, 1991 in the amount of $3,964. Gulf Oil Corporation/Waccasassa Gulf, Case No. RF300-11515 (May 21, 1991). The second, Case No. RF300-20047, was filed by Michael Herndon for a portion of the refund monies previously granted to Luko Bruer in Case No. RF300-12317.
On July 25, 1985, the Economic Regulatory Administration of the Department of Energy (DOE) filed a Petition with the Office of Hearings and Appeals (OHA) requesting that the OHA formulate and implement procedures for distributing funds obtained through a consent order with Gulf Oil Corporation (Gulf). See 10 C.F.R. Part 205, Subpart V. The consent order resolved DOE allegations that Gulf violated the mandatory petroleum regulations in its sales of crude oil and refined petroleum products from January 1, 1973 through January 27, 1981 (the consent order period). On September 8, 1987, the OHA issued a Decision and Order setting forth final procedures for disbursing the portion of the Gulf settlement fund attributable to Gulf's sales of refined petroleum products. Gulf Oil Corp., 16 DOE ¶ 85,381 (1987) (Gulf). In accordance with the goals of 10 C.F.R. Part 205, Subpart V, Gulf implements a process for refunding the consent order funds to purchasers of Gulf refined petroleum products who are able to
demonstrate that they were injured as a result of Gulf's alleged overcharges.
In Case No. RF300-12317, Luko Bruer requested a refund for Gulf products purchased by Bruer Gulf from March 1973 to January 1981. Mr. Bruer provided a copy of his Gulf Customer Listing, which shows that Bruer Gulf purchased 4,129,152 gallons of Gulf product under Gulf Customer Number 2191343-9 during the consent order period. Accordingly, on May 21, 1991, we granted a refund in the Gulf Special Refund proceeding to Bruer Gulf in the amount of $3,964 (4,129,152 gallons x $.00096 = $3,964).(1)
We have now determined that Mr. Bruer was not entitled to receive a refund for all of Bruer Gulfs purchases, because he leased the station to Michael Herndon from May 31, 1979 forward. (2) Under the lease agreement, Mr. Herndon was responsible for the Gulf purchases that occurred while he was operating the station. In a letter dated February 7, 1992, the spouse of Luko Bruer confirmed that she and her husband would not be entitled to receive that portion of the refund to which Mr. Herndon is entitled. (3) However, in that same letter, Mrs. Bruer insisted that they never received a refund check in Case No. RF300-12317. In response, we sent Mrs. Bruer a copy of the canceled check with her signature endorsing the check for payment in a letter dated April 29, 1992. After reviewing the canceled check, Mrs. Bruer conceded in a letter dated May 13, 1992 that she and her husband had, in fact, received and cashed a check from the U.S. Treasury in the amount of $3,964 for the Gulf purchases claimed in Case No. RF300-12317. She then stated that they are prepared to pay back some portion of the refund. (4)
Mr. Herndon leased the station from May 31, 1979 forward. The consent order period lasted for 95 months; Mr. Herndon operated the station for 20 months of the 95-month period. As such, Mr. Herndon is entitled to receive a refund for 869,295 gallons of Gulf product purchased by the business (4,129,152 gallons/95 months = 43,465.75 gallons/month; 20 months x 43,465.75 gallons/month = 869,295). Mr. Bruers approved gallonage claim in Case No. RF300-12317 must be reduced by that same amount, from 4,129,152 gallons to 3,259,857 gallons.
Accordingly, we will rescind a portion of the refund Luko Bruer, owner of Bruers Gulf, received in Case No. RF300-12317. The total amount rescinded from Mr. Bruer is $835 (3,259,857 gallons x $.00096 = $3,129; $3,964 - $3,129 = $835).(5) We will also grant a refund to Michael Herndon for 869,295 gallons. Mr. Herndons approved refund amount in this Decision and Order is $1,087.(6)
It Is Therefore Ordered That:
(1) The Decision and Order issued by the DOE on May 21, 1991, Gulf Oil Corporation/Waccasassa Gulf, Case No. RF300-11515, is hereby rescinded with respect to Bruer Airland Gulf, Case No. RF300-12317. For purposes of the rescission, the case has been redesignated RF300-20048. The total amount rescinded from Luko Bruer, owner of Bruer Airland Gulf, is $835. This amount shall be remitted to the Department of Energy as instructed in Paragraph (2) of this Order.
(2) With respect to Case No. RF300-12317, Luko Bruer of Bruer Airland Gulf applied for and received a refund with the assistance of Federal Refunds, Inc., a private filing service located in Atlantic Beach, Florida. Mr. Luko Bruer and Federal Refunds, Inc. are hereby jointly and severally directed to remit the sum of $835 within thirty (30) days of this Decision and Order. The check shall be made payable to the U.S. Department of Energy, shall prominently display the redesignated Case No., RF300-20048, and shall be sent to:
Department of Energy
Office of the Controller
Cash Control Branch
P.O. Box 500
Germantown, MD 20874
(3) In the event that these payments are not made within 30 days of the date of this Decision and Order, interest shall accrue on the amount due at the rate generally assessed by the Department of Energy on overdue receivables. Other charges generally assessed on overdue DOE receivables shall also apply.
(4) Upon notification by the Office of the Controller of the receipt of these funds, the Director of Special Accounts and Payroll, Office of the Departmental Accounting and Financial Systems Development, Office of the Controller of the Department of Energy, shall deposit these funds into the deposit fund escrow account maintained at the Department of the Treasury and funded by Gulf Oil Corporation, Consent Order No. RGFA00001Z.
(5) The Application for Refund filed by Michael Herndon, Case No. RF300-20047, is hereby granted as set forth in paragraph (6) below.
(6) The Director of Special Accounts and Payroll, Office of Departmental Accounting and Financial Systems Development, Office of the Controller of the Department of Energy shall take appropriate action to disburse a total of $1,087 from the DOE deposit fund escrow account maintained at the Department of the Treasury and funded by Gulf Oil Corporation, Consent Order No. RGFA00001Z, to Michael Herndon.
(7) The refund due to Michael Herndon should be sent to: Michael Herndon, 11127 Rosa Court, Fairhope, AL 36532-5152. The total refund amount approved for Michael Herndon in this Order is $1,087.
(8) The determinations made in this Decision and Order are based on the presumed validity of statements and documentary material submitted by the Applicant. Any of these determinations may be revoked or modified at any time upon a determination that the factual basis underlying any Application for Refund is incorrect.
(9) This is a final Order of the Department of Energy.
George B. Breznay
Director
Office of Hearings and Appeals
Date: May 14, 1997
(1)The total volumetric on May 21, 1991 was $.00096, which was computed by adding the principal volumetric, $.00064, to the current interest volumetric of $.00032.
(2)The lease agreement itself covers only the period May 31, 1979 to May 30, 1980. However, Mr. Herndon has established that, after the lease period ended, he continued operating the business until December 1988. See Letter from Mrs. Michael Herndon to Thomas L. Wieker, OHA Deputy Director, dated September 11, 1992.
(3)See Letter from Diana Bruer to Thomas L. Wieker, OHA Deputy Director, dated February 7, 1992.
(4)See Letter from Diana Bruer to Thomas L. Wieker, OHA Deputy Director, dated May 13, 1992.
(5)In cases where the volumetric rate has changed since the time when the original refund was granted, we rescind refund monies improperly granted at the volumetric rate in effect when granted.
(6)The refund amount is calculated by multiplying Mr. Herndons approved gallonage by the current total volumetric, which is $.00125 (principal volumetric of $.00064 + interest volumetric of $.00061 = $.00125).