B-229052, Oct 28, 1987, 67 Comp.Gen. 37

B-229052, Oct 28, 1987, 67 Comp.Gen. 37

APPROPRIATIONS/FINANCIAL MANAGEMENT - Appropriations Availability - Purpose Availability - Attorney Fees DIGEST: Department of Interior employee was charged with prohibited personnel practices by Merit Systems Protection Board. Agency, upon determining that employee's conduct was within the scope of her employment, may use appropriated funds to pay reasonable costs of employee's legal representation in the administrative proceedings.

Jeannette E. Nichols:

The Minerals Management Service (MMS), Department of the Interior, seeks our opinion on whether it may use its appropriated funds to pay attorney fees incurred by Ms. Jeannette E. Nichols, an MMS employee, in connection with administrative proceedings before the Merit Systems Protection Board (MSPB). The answer is yes.

In June l986, the MSPB Office of Special Counsel filed a complaint against Ms. Nichols, alleging prohibited personnel practices in connection with the recruitment and selection of a subordinate position. Ms. Nichols retained private counsel and incurred substantial legal fees in defending herself against the charges. Both MMS and counsel for Ms. Nichols suggest that MMS may pay the legal fees, on the basis of our decision at 61 Comp.Gen. 515 (l982). We agree.

In the cited decision, we were asked whether the International Trade Commission could use appropriated funds to provide legal representation for employees brought before the MSPB by the Special Counsel. concluded that an agency's appropriations "are available to provide a supervisor with representation in an administrative hearing if he performed the conduct in issue within the scope of his employment," that is, if the conduct was "in furtherance of, or incident to his carrying out his official duties." 61 Comp.Gen. at 516. In addition, the agency must determine that providing representation would be in the government's interest. Id.; 53 Comp.Gen. 301 (l973). In such a case, the cost of legal representation may be considered a "necessary expense" of the agency or function. We have also pointed out that an agency has a legitimate interest in furnishing legal representation in such cases, in that failure to do so might deter employees from the rigorous performance of their duties. 61 Comp.Gen. at 516-17. Surely federal employees must be answerable for illegal conduct. Yet it can be in the interest of neither the government as a whole nor the taxpayers we serve to have employees afraid to function out of fear of being bankrupted by a lawsuit arising out of the good faith performance of their jobs.

Ms. Nichols' immediate supervisor has certified that her actions out of which the charges arose "were logical management decisions inherent in her position as a manager," and were "proper, within regulations, and within the scope of authority of her position." The Chief of the MMS Financial Management Division endorses this view and urges that payment would be in the best interest of the government. Under these circumstances, the proposed payment follows logically and directly from 61 Comp.Gen. 515.

As a final note, it should be understood that payment in this type of case is not a legal liability on the part of the agency, but is essentially a discretionary payment. As such, an agency is not required to pay the entire amount of the fees actually charged in any given case. The controlling concept under fee-shifting statutes is a "reasonable" attorney's fee, /1/ and there is a vast body of judicial precedent applying this concept under statutes such as the Back Pay Act and Title VII of the Civil Rights Act. This body of precedent is available to provide guidance to agencies in evaluating the reasonableness of claims. Also, since payment is discretionary, an agency is free to formulate administrative policies with respect to treatment of claims of this type. Of course, any such policies should be applied fairly and consistently.

/1/ We are in no way implying that the fees charged in this case were not reasonable. We are saying merely that agencies should review the actual billing and are not legally required to pay or reimburse the entire amount. The determination of what is or is not reasonable in a given case is up to the agency, and is a matter we would consider it inappropriate to review. EXTRA LINE