A-14007, APRIL 27, 1926, 5 COMP. GEN. 870

A-14007: Apr 27, 1926

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

ADMIRALTY JUDGMENTS - COMPROMISE - WAIVER OF INTEREST THERE IS NO AUTHORITY OTHER THAN AS PROVIDED IN SECTION 3469. 1926: I HAVE YOUR REQUEST OF APRIL 7. IT FURTHER APPEARS THAT NEGOTIATIONS WERE ENTERED INTO BETWEEN A NEW YORK FIRM OF ATTORNEYS. THE DISTRICT ATTORNEY DIED BEFORE NEGOTIATIONS WERE COMPLETED. THEY WERE RENEWED WITH HIS SUCCESSOR. WHO APPEARS TO HAVE INDICATED THAT HE WOULD RECOMMEND ACCEPTANCE OF $11. WHICH WAS $1. WERE AUTHORIZED TO OFFER IN SETTLEMENT. SUCH RECOMMENDATION WAS MADE TO THE GOVERNOR OF THE PANAMA CANAL AND HE INDICATED TO THE DISTRICT ATTORNEY THAT SETTLEMENT MIGHT BE MADE FOR $12. THIS INFORMATION WAS CONVEYED TO THE ATTORNEYS REPRESENTING THE SHIP.

A-14007, APRIL 27, 1926, 5 COMP. GEN. 870

ADMIRALTY JUDGMENTS - COMPROMISE - WAIVER OF INTEREST THERE IS NO AUTHORITY OTHER THAN AS PROVIDED IN SECTION 3469, REVISED STATUTES, FOR THE COMPROMISE OF AN ADMIRALTY JUDGMENT RENDERED IN FAVOR OF THE UNITED STATES, AND WHERE SUCH A JUDGMENT BEARS INTEREST FROM THE DATE THEREOF UNTIL PAID A UNITED STATES ATTORNEY MAY NOT WAIVE THE INTEREST.

COMPTROLLER GENERAL MCCARL TO THE GOVERNOR OF THE PANAMA CANAL, APRIL 27, 1926:

I HAVE YOUR REQUEST OF APRIL 7, 1926, AND ACCOMPANYING PAPERS FOR DECISION WHETHER THERE MAY BE REMITTED, OR WAIVED, THE AMOUNT OF INTEREST ACCRUING IN AN ADMIRALTY JUDGMENT BETWEEN THE DATE OF THE DECREE AND DATE OF PAYMENT UNDER CIRCUMSTANCES WHICH MAY BE EPITOMIZED AS FOLLOWS:

IT APPEARS THAT PRIOR TO SEPTEMBER 11, 1922, THE EXACT DATE NOT BEING SHOWN, THE STEAMSHIP NORDFARER, WHILE IN CHARGE OF THE PILOT, COLLIDED WITH UNITED STATES BARGE NO. 137 IN CANAL ZONE WATERS AND THAT BOTH THE SHIP AND THE BARGE SUSTAINED CONSIDERABLE DAMAGE. IT FURTHER APPEARS THAT NEGOTIATIONS WERE ENTERED INTO BETWEEN A NEW YORK FIRM OF ATTORNEYS, THROUGH REPRESENTATIVES IN THE CANAL ZONE, ON BEHALF OF THE SHIP, AND THE DISTRICT ATTORNEY FOR THE CANAL ZONE, ON BEHALF OF THE BARGE, FOR THE SETTLEMENT OF THE DAMAGE AND THE INCLOSURES, WITH THE REQUEST FOR DECISION, SEEM TO SUGGEST THAT THE THEN DISTRICT ATTORNEY OFFERED TO SETTLE FOR $8,000, SUBJECT TO THE APPROVAL OF THE GOVERNOR OF THE PANAMA CANAL. THE DISTRICT ATTORNEY DIED BEFORE NEGOTIATIONS WERE COMPLETED, AND THEY WERE RENEWED WITH HIS SUCCESSOR, WHO APPEARS TO HAVE INDICATED THAT HE WOULD RECOMMEND ACCEPTANCE OF $11,500, WHICH WAS $1,500 IN EXCESS OF THE AMOUNT THE ATTORNEYS IN THE CANAL ZONE, REPRESENTING THE SHIP,WERE AUTHORIZED TO OFFER IN SETTLEMENT. SUCH RECOMMENDATION WAS MADE TO THE GOVERNOR OF THE PANAMA CANAL AND HE INDICATED TO THE DISTRICT ATTORNEY THAT SETTLEMENT MIGHT BE MADE FOR $12,500. THIS INFORMATION WAS CONVEYED TO THE ATTORNEYS REPRESENTING THE SHIP, BUT WAS NOT ACCEPTED BY THEM, AND THE MATTER WAS PENDING UPON THE APPOINTMENT OF THE PRESENT DISTRICT ATTORNEY, WHO INSISTED THAT SAME BE BROUGHT TO A CONCLUSION.

AFTER SOME FURTHER DELAY AT THE REQUEST OF THE ATTORNEYS REPRESENTING THE SHIP, THE LIBEL AGAINST THE SHIP AND THE CROSS LIBEL AGAINST THE BARGE WERE BROUGHT ON FOR HEARING BEFORE THE UNITED STATES DISTRICT COURT FOR THE CANAL ZONE, AND RESULTED IN A DECREE DATED AUGUST 11, 1925, DISMISSING THE CROSS LIBEL AND AWARDING JUDGMENT OF $13,548.15 ON THE LIBEL, TOGETHER WITH INTEREST THEREON AT THE RATE OF 6 PERCENT FROM THE DATE OF THE DECREE UNTIL PAID AND COSTS OF $104.29. THE ATTORNEYS REPRESENTING THE SHIP REMITTED ON MARCH 16, 1926, $3,548.15 IN PAYMENT OF THE PRINCIPAL OF THE JUDGMENT AND $104.29 IN PAYMENT OF THE COST; AND THE DISTRICT ATTORNEY AGREED TO WAIVE THE "CLAIM FOR INTEREST * * * BY AND WITH THE CONSENT OF THE GOVERNOR OF THE PANAMA CANAL, BUT SUBJECT, NEVERTHELESS, TO CONFIRMATION BY THE COMPTROLLER GENERAL OF THE UNITED STATES.' IT IS STATED IN THE PRESENT SUBMISSION THAT THE GOVERNOR IS "PERFECTLY WILLING TO WAIVE THE INTEREST ON THIS JUDGMENT IF THAT CAN BE LEGALLY DONE, IN VIEW OF THE FACT THAT THE UNITED STATES DOES NOT PAY INTEREST ON CLAIMS DUE FROM IT UNDER LIKE CIRCUMSTANCES.'

THE MATTER OF DAMAGES FOR THE COLLISION CEASED TO BE A CLAIM ON AUGUST 11, 1925, AND BECAME MERGED INTO A JUDGMENT FOR $13,548.15, TOGETHER WITH INTEREST AT 6 PERCENT FROM THE DATE THEREOF UNTIL PAID AND COSTS.

THE AUTHORITY OF THE DISTRICT ATTORNEY FOR THE CANAL ZONE, UNDER SECTION 8 OF THE ACT OF AUGUST 24, 1912, 37 STAT. 567, DOES NOT EXTEND TO THE COMPROMISE OF CLAIMS OF THE UNITED STATES ARISING IN HIS JURISDICTION EXCEPT AS PROVIDED IN SECTION 3469, REVISED STATUTES, AND HIS NEGOTIATIONS WITH ATTORNEYS REPRESENTING THE SHIP CAN NOT BE HELD TO CREATE ANY GREATER LIABILITY THAN SIMILAR NEGOTIATIONS OF DISTRICT ATTORNEYS IN CONTINENTAL UNITED STATES. FURTHER, THE SUGGESTION THAT THE GOVERNMENT DOES NOT PAY INTEREST ON ADMIRALTY JUDGMENTS IS REFUTED BY SECTION 3 OF THE SUITS IN ADMIRALTY ACT OF MARCH 9, 1920, 41 STAT. 526, WHICH PROVIDES THAT AN ADMIRALTY "DECREE AGAINST THE UNITED STATES OR SUCH CORPORATION MAY INCLUDE COST OF SUIT, AND WHEN THE DECREE IS FOR A MONEY JUDGMENT INTEREST AT THE RATE OF 4 PERCENT PER ANNUM UNTIL SATISFIED OR AT ANY HIGHER RATE WHICH SHALL BE STIPULATED IN ANY CONTRACT UPON WHICH SUCH DECREE SHALL BE BASED. INTEREST SHALL RUN AS ORDERED BY THE COURT.' I AM NOT ADVISED OF ANY INSTANCE WHERE AN ADMIRALTY JUDGMENT AGAINST THE UNITED STATES HAS BEEN SETTLED BY THE WAIVER OF ANY INTEREST THEREON ALLOWED BY THE COURT.

HERE INTEREST WAS ORDERED BY THE COURT TO RUN FROM THE DATE OF THE DECREE TO DATE OF PAYMENT, AND THE JUDGMENT MAY NOT BE COMPROMISED UPON PAYMENT OF PRINCIPAL AND COSTS, EXCEPT AS PROVIDED IN SECTION 3469, REVISED STATUTES. SEE 13 OP.ATTY.GEN. 479. PRESUMABLY THE SHIP WAS RELEASED UNDER BOND AND THERE WOULD APPEAR TO BE NEITHER REASON NOR JUSTIFICATION FOR COMPROMISE OF THE JUDGMENT AND CERTAINLY INTEREST THEREON MAY NOT BE WAIVED BY THE DISTRICT ATTORNEY OR THE GOVERNOR, FOR, AS STATED IN PACIFIC HARDWARE CO. V. UNITED STATES, 49 CT.CLS., 327, 335:

IT IS UNQUESTIONABLY TRUE THAT AN OFFICIAL OF THE GOVERNMENT IS NOT AUTHORIZED TO GIVE AWAY OR REMIT A CLAIM DUE THE GOVERNMENT. THIS RULE IS GROUNDED IN A SOUND PUBLIC POLICY AND IS NOT TO BE WEAKENED.

ANSWERING YOUR QUESTION SPECIFICALLY YOU ARE ADVISED THAT THE DISTRICT ATTORNEY IS NOT AUTHORIZED TO ACCEPT THE PRINCIPAL AND COSTS OF THE JUDGMENT IN FULL SETTLEMENT THEREOF, BUT SHOULD ENFORCE SETTLEMENT IN ACCORDANCE WITH THE TERMS OF THE DECREE; THAT IS, HE SHOULD COLLECT THE PRINCIPAL AND INTEREST THEREON UNTIL PAID, AND THE COSTS.