B-143673, NOV 11, 1976

B-143673, NOV 11, 1976

1. INTERNAL REVENUE SERVICE APPROPRIATIONS ARE NOT AVAIABLE TO PAY JUDGMENTS OR SETTLEMENTS IN TORT SUITS AGAINST IRS EMPLOYEES FOR ACTIONS TAKEN IN PERFORMANCE OF OFFICIAL DUTIES. SUCH JUDGMENTS OR SETTLEMENTS ARE REGARDED AS OBLIGATIONS OF THE UNITED STATES PAYABLE FROM THE PERMANENT INDEFINITE APPROPRIATION ESTABLISHED BY 31 U.S.C. 724(A) IF NOT OVER $100,000. IF INDIVIDUAL JUDGMENT OR SETTLEMENT EXCEEDS $100,000, IT IS NECESSARY TO REQUEST SPECIFIC APPROPRIATION FOR PAYMENT. 2. JUDGMENTS OR SETTLEMENTS PAYABLE FROM PERMANENT INDEFINITE APPROPRIATION MUST BE CERTIFIED BY COMPTROLLER GENERAL UNDER 31 U.S.C. 724(A). IRS MAY NOT BE AUTHORIZED TO CERTIFY JUDGMENT OR SETTLEMENTS FOR PAYMENT FROM PERMANENT INDEFINITE APPROPRIATION.

AVAILABILITY OF INTERNAL REVENUE SERVICE APPROPRIATIONS FOR PAYMENT OF JUDGMENTS OR SETTLEMENTS IN TORT SUITS AGAINST EMPLOYEES:

THE ASSISTANT SECRETARY FOR ADMINISTRATION, DEPARTMENT OF THE TREASURY, HAS REQUESTED THAT WE RECONSIDER ONE ASPECT OF OUR OPINIONS, 53 COMP.GEN. 782 (1974) AND 40 COMP.GEN. 95 (1960). SPECIFICALLY, THE INTERNAL REVENUE SERVICE (IRS) IS CONCERNED WITH THE HOLDING IN THESE OPINIONS WHICH PRECLUDES THE USE OF ITS PRESENT APPROPRIATIONS FOR THE PAYMENT OF JUDGMENTS AND SETTLEMENTS IN ACTIONS AGAINST INDIVIDUAL IRS EMPLOYEES DETERMINED TO HAVE BEEN ACTING WITHIN THE SCOPE OF THEIR EMPLOYMENT. THE ASSISTANT SECRETARY ALSO REQUESTS THAT, IF WE SHOULD REAFFIRM OUR POSITION THAT IRS APPROPRIATIONS ARE NOT AVAILABLE TO PAY THESE JUDGMENTS, AN AGREEMENT BE WORKED OUT WHEREBY THE SERVICE COULD ROUTINELY CERTIFY THE JUDGMENTS FOR PAYMENT WITHIN SPECIFIED LIMITS FROM THE PERMANENT INDEFINITE APPROPRIATION ESTABLISHED BY 31 U.S.C. 724(A).

THIS OFFICE HAS LONG HELD THAT APPROPRIATIONS OR FUNDS PROVIDED FOR REGULAR GOVERNMENTAL OPERATIONS OR ACTIVITIES, OUT OF WHICH A CAUSE OF ACTION ARISES, ARE NOT AVAILABLE TO PAY JUDGMENTS OF COURTS IN THE ABSENCE OF SPECIFIC AUTHORITY. SEE 34 COMP.GEN. 221, 15 ID. 933, 2 ID. 821. PRIOR TO THE ENACTMENT OF 31 U.S.C. 724(A), WHICH PROVIDES A PERMANENT APPROPRIATION FOR THE PAYMENT OF FINAL JUDGMENTS, AWARDS, AND COMPROMISE SETTLEMENTS NOT IN EXCESS OF $100,000, ALL JUDGMENTS HAD TO BE TRANSMITTED TO CONGRESS FOR FUNDING. THE ACT OF APRIL 27, 1904, 33 STAT. 422, UNDER THE HEADING "JUDGMENTS, UNITED STATES COURTS" PROVIDED:

" * * * THAT HEREAFTER ESTIMATES FOR THE PAYMENT OF ALL JUDGMENTS AGAINST THE UNITED STATES, INCLUDING JUDGMENTS * * * OF THE UNITED STATES COURTS SHALL BE TRANSMITTED TO CONGRESS THROUGH THE TREASURY DEPARTMENT AS OTHER ESTIMATES OF APPROPRIATIONS ARE REQUIRED TO BE TRANSMITTED."

IT WAS HELD THAT, UNDER THIS STATUTE, FUNDS PROVIDED FOR REGULAR GOVERNMENTAL OPERATIONS OR ACTIVITIES ARE NOT AVAILABLE TO PAY JUDGMENTS. SEE 27 COMP.DEC. 108, 262 (1920). THE ENACTMENT OF THE PERMANENT INDEFINITE APPROPRIATION, 31 U.S.C. 724(A), DID NOT CHANGE THE LONG ESTABLISHED RULE WHICH PRECLUDES THE USE OF REGULAR APPROPRIATIONS FOR THE PAYMENT OF JUDGMENTS.

THE ASSISTANT SECRETARY CALLS OUR ATTENTION TO THE MILITARY PERSONNEL AND CIVILIAN EMPLOYEES CLAIMS ACT OF 1964, 31 U.S.C. 240-243 (1970). THIS STATUTE AUTHORIZES FEDERAL OFFICIALS " * * * TO SETTLE AND PAY * * * "CERTAIN CLAIMS BY EMPLOYEES OR MEMBERS OF THE UNIFORMED SERVICES FOR DAMAGE TO OR LOSS OF PERSONAL PROPERTY ARISING OUT OF THEIR SERVICE. U.S.C. 241. PAYMENT OF THESE CLAIMS MAY BE MADE FROM REGULAR DEFENSE DEPARTMENT APPROPRIATIONS. THE ASSISTANT SECRETARY SUGGESTS THAT THE SAME RATIONALE WHICH ALLOWS PAYMENT FOR DAMAGES UNDER 31 U.S.C. 243 TO DEFENSE DEPARTMENT EMPLOYEES FROM REGULAR APPROPRIATIONS SHOULD BE APPLIED TO PERMIT USE OF APPROPRIATED FUNDS TO PAY DAMAGES AND COSTS RECOVERED AGAINST OFFICERS AND EMPLOYEES OF THE TREASURY DEPARTMENT IN ANY SUIT BROUGHT BY REASON OF THEIR PERFORMANCE OF OFFICIAL DUTIES, PURSUANT TO 26 U.S.C. 7423. IN OUR OPINION, THE SITUATIONS ARE NOT COMPARABLE.

THE MILITARY PERSONNEL AND CIVILIAN EMPLOYEES CLAIMS ACT INVOLVES ADMINISTRATIVE CLAIMS BROUGHT BY AN EMPLOYEE OR MEMBER AGAINST HIS EMPLOYER. SETTLEMENTS MUST BE PAID FROM AGENCY APPROPRIATIONS. THE APPROPRIATION UNDER 31 U.S.C. 724(A) FOR JUDGMENTS OR SETTLEMENTS IN LAWSUITS WOULD NOT BE AVAILABLE FOR THIS PURPOSE, SINCE 31 U.S.C. 240 243 IS AN EXCLUSIVE REMEDY AND CLAIMS BROUGHT THEREUNDER CANNOT BE THE SUBJECT OF SUIT. HENCE, IF THE REGULAR APPROPRIATIONS OF THE AGENCY WERE NOT AVAILABLE FOR THE PURPOSE, THERE WOULD BE NO WAY TO PAY CLAIMS UNDER 31 U.S.C. 241, AND THE LANGUAGE AUTHORIZING THE APPROPRIATE OFFICIAL TO "SETTLE AND PAY" CLAIMS WOULD BE DEPRIVED OF MEANING.

WITH RESPECT TO 26 U.S.C. 7423, ON THE OTHER HAND, THE LIABILITY OF THE UNITED STATES IS NOT BASED ON AN ADMINISTRATIVE CLAIM BY AN EMPLOYEE BUT ON AN ACTION AT LAW BROUGHT BY THIRD PARTIES AGAINST THE EMPLOYEE AND THE PROCEDURES PRESCRIBED UNDER 31 U.S.C. 724(A) MUST BE APPLIED.

WITH REGARD TO THE SUGGESTION THAT AN AGREEMENT BE WORKED OUT WHEREBY THE IRS COULD CERTIFY A JUDGMENT FOR PAYMENT FROM THE PERMANENT INDEFINITE APPROPRIATION, THE STATUTE PRECLUDES ANY SUCH ARRANGEMENT. 31 U.S.C. 724(A) SPECIFICALLY REQUIRES CERTIFICATION BY THE COMPTROLLER GENERAL. ANY OTHER PROCEDURE WOULD BE CONTRARY TO THE TERMS OF THE STATUTE.

WE RECOGNIZE THAT IN THESE CIRCUMSTANCES, IRS CANNOT GIVE ADVANCE ASSURANCE TO EMPLOYEES THAT PERSONAL JUDGMENTS OBTAINED AGAINST THEM WILL BE PAID BY THE GOVERNMENT IN ALL CIRCUMSTANCES. WE WOULD HAVE NO OBJECTION TO THE ENACTMENT OF LESGILATION MAKING IRS APPROPRIATIONS SPECIFICALLY AVAILABLE TO PAY JUDGMENTS OR SETTLEMENTS IN TORT SUITS AGAINST ITS EMPLOYEES FOR ACTIONS TAKEN IN THE DUE PERFORMANCE OF OFFICIAL DUTIES.