Board of Contract Appeals General Services Administration Washington, D.C. 20405 _____________________ April 28, 2000 _____________________ GSBCA 15218-RELO In the Matter of BYRON D. CAGLE Byron D. Cagle, McAllen, TX, Claimant. Edgardo Aviles, Travel Team Leader, Accounting Services Division, United States Customs Service, Indianapolis, IN, appearing for Department of the Treasury. NEILL, Board Judge. Claimant in this case, Mr. Byron D. Cagle, an employee of the Department of the Treasury, has asked that we review his agency s denial of a claim for reimbursement of certain closing costs he paid in connection with the sale of his home in Woodbridge, Virginia. The home was sold when Mr. Cagle was transferred from the Washington, D.C. metropolitan area to Pharr, Texas. The agency contends that the costs for which Mr. Cagle seeks reimbursement are not those which are customarily paid in the area by the seller. Based upon the record before us, we grant the claim. Background On October 29, 1999, claimant was issued orders transferring him from agency headquarters in Washington, D.C. to Pharr, Texas. As a result of his transfer, he sold his home in Woodbridge, Virginia. He states that at the time he listed his home for sale, his realtor advised him that, in the area where he resided, it was usual and customary for the seller to pay anywhere from three to six percent of the selling price towards the purchaser's closing costs. Following this discussion with his realtor, Mr. Cagle asked an official in the agency relocation office whether these costs would be reimbursable. He was told to consult with the local Department of Housing and Urban Development (HUD) office to determine which costs were applicable to the seller in his local area. He was further advised that, if HUD could not provide this information, then he should secure from his realtor a signed statement that the closing costs he was to incur were usual and customary for his area. Upon contacting HUD, Mr. Cagle was told that the information he sought was no longer provided. He then secured a letter from his realtor confirming that in Prince William County, Virginia (where Woodbridge is located), it is customary for the seller to contribute to the purchaser s closing costs. In support of this statement, the realtor provided sales data on sixty homes located in claimant s subdivision, which, over the last six months, had sold at prices close to the price of Mr. Cagle s home ($130,000 to $138,000). The data showed that for fifty-eight of the sixty sales, the sellers had in fact contributed to the purchasers closing costs. In the majority of these cases the contribution ranged from three to six percent of the selling price. Based on the information provided to him by his realtor, Mr. Cagle entered into a contract of sale in which he agreed to pay three percent of the buyer s closing costs. Following the sale of his home, Mr. Cagle sought reimbursement for $3886 of the buyer s closing costs, which he paid per his contract of sale. In support of his request, he submitted the data on sales in the area previously provided to him by his realtor. The agency, however, denied this portion of his claim on the ground that the practice of assuming a buyer's closing costs by contract is not a custom. In its report to the Board, the agency continues to acknowledge that the practice of contributing to a buyer s closing cost may be common in Prince William County, Virginia, but it argues that this does not mean such a practice is customary. Rather, the agency remains of the opinion that this practice is temporary in nature and dictated by current market conditions. In response to the agency report, Mr. Cagle has submitted additional information regarding what he alleges is the custom in Prince William County, Virginia, of sellers contributing to the closing costs of buyers. This time the data submitted covers 476 sales of detached homes in the same basic price range as Mr. Cagle s former residence and located in the same general area of Prince William County. The data covers a period from mid-October 1996 to January 31, 2000. In a high number of instances, namely 445 or 93% of all sales, sellers did, in fact, contribute to the purchasers closing costs. In the majority of cases, the contribution ranges from two to six percent. Discussion The Federal Travel Regulation (FTR) provides that if a federal civilian employee is transferred from one official station to another and various conditions are met, miscellaneous expenses involved in that employee's sale and/or purchase of a residence shall be reimbursed by the Government. One requirement which must be met in this regard is that the expense for which the employee seeks reimbursement is customarily paid by the seller of a residence in the locality of the old official station or by the purchaser of a residence at the new official station. In addition, the amount sought must be within the limits of that which is, as a matter of fact, customarily paid. 41 CFR 302- 6.2(d) (1999) (FTR 306-6.2(d)). An expense is deemed to be customarily paid "if by long and unvarying habitual actions, constantly repeated, such payment has acquired the force of a tacit and common consent within a community." Christopher L. Chretien, GSBCA 13704-RELO, 97-1 BCA 28,701 (1996). When questions of local custom arise, the burden is on the claimant to show why he or she should prevail. 48 CFR 6104.1(c) (1999); Sara Blanding, GSBCA 14493-RELO, 98-2 BCA 29,790; Pierre S. Ware, GSBCA 14150-RELO, 97-2 BCA 29,061. To convince us that the agency's initial decision to deny these costs was incorrect, claimant must provide persuasive evidence that it is indeed customary in Prince William County, Virginia, for the seller to contribute to payment of the purchaser's closing costs. In this case, we find that Mr. Cagle has met his burden. This is not the first time we have encountered the custom which he states exists in Virginia s Prince William County. In 1997, we were asked to comment on a similar claim from an employee who had sold his house in Prince William County in 1995. At that time, the agency informed us that the title company which handled the closing on the sale of the claimant s residence had explained that in Prince William County it is the local custom for the seller to contribute funds towards the buyer s closing costs. In support of this statement, the title company had provided information on the sales of several homes in the area during 1994 and 1995. In addition, claimant s realtor provided a letter confirming that this local practice had existed in the area for years. We concluded that the evidence furnished to the agency was sufficient to demonstrate that it was customary in Prince William County for sellers to contribute to a purchaser s closing costs for the sale of a home such as that which the claimant had sold. Brent T. Wahlquist, GSBCA 13721-RELO, 97-2 BCA 29,094. In contrast, we examined a similar claim for closing costs paid in conjunction with the sale of a transferred employee's home in nearby Arlington, Virginia. In that case, we concluded that the claimant had failed to meet his burden of proof. The claim was supported with nothing more than two letters, one from the claimant s real estate sales associate and the other from the title company which conducted the closing. Both confirmed that in the area sellers were accustomed to contributing to purchasers closing costs within certain percentage ranges. However, no specific data on sales was submitted and the agency s concern that this practice was driven by market conditions rather than custom remained unaddressed. Donald V. McNamara, GSBCA 14428-RELO, 98-2 BCA 29,807. In opposing Mr. Cagle's claim, his agency cites three decisions of the Comptroller General which stand for the proposition that simply because it is common for a seller to assume a buyer's closing costs by contract does not mean that the practice is customary. We agree with the proposition. A common practice does not necessarily equate to established custom. On the other hand, over time it can become so. For this reason, we look to the claimant in each individual case to demonstrate that this has in fact occurred. In this case, the data submitted by Mr. Cagle confirms continuation to the present of a custom demonstrated to exist already in Prince William County in 1994. Given the existence of this practice for such a long period, we do not view it as a mere reflection of temporary market conditions. Indeed, after examining the data submitted by Mr. Cagle on 476 sales from 1996 to 2000, it appears to us that it is much more likely that changes in market conditions are, as a matter of fact, reflected in the variation of the percentage of the seller s contribution rather than in the simple fact of a contribution being made or not made. Furthermore, given the actual variation in contributions, as shown in Mr. Cagle's data, between two and six percent of selling prices, Mr. Cagle s contribution of three percent appears to be well within the limit of that which is customarily paid. Accordingly, we conclude that Mr. Cagle is entitled to reimbursement of the costs claimed, provided, of course, that this and other reimbursements made in connection with the sale of his residence at his old official station do not exceed the overall limitation on such reimbursements, namely, ten percent of the actual sales price of the residence. See FTR 302-6.2(g)(1). _____________________________ EDWIN B. NEILL Board Judge