B-58540 August 12, 1946

B-58540: Aug 12, 1946

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Clark: There was received a letter of April 25. In cases where it has been determined that no appeal will be prosecuted. Is indicated by the following excerpt from the above-mentioned letter of April 25. 1946: "The number of judgements under the Suits in Admiralty Act during the next few years will be very great. The aggregate amount of the judgements will run into the millions of dollars. Some of the judgements in total loss collision cases will run over $1. Most of these judgements will bear interest at 4% as authorized by Section 3 of the Act. The aggregate loss to the Government will be considerable if it is necessary to await the expiration of the appeal date in each case.". That no appeal will be taken by either libellant or respondent.

B-58540 August 12, 1946

The Honorable, The Attorney General.

My dear Mr. Clark:

There was received a letter of April 25, 1946, from the General Counsel, United States Maritime Commission, requesting that consideration be given to payment by this office -- prior to the expiration of the time for filing appeal -- of interest-bearing judgements rendered against the United States under the Suits in Admiralty Act, 41 Stat. 525, 46 U.S.C. 741-752, in cases where it has been determined that no appeal will be prosecuted.

The desirability of making prompt payment of interest-bearing judgements under the Suits in Admiralty Act, from the standpoint of savings to the Government in interest, is indicated by the following excerpt from the above-mentioned letter of April 25, 1946:

"The number of judgements under the Suits in Admiralty Act during the next few years will be very great, due to the enormous number of vessels operated by the Government during the war and present post war period, and the aggregate amount of the judgements will run into the millions of dollars. Some of the judgements in total loss collision cases will run over $1,000,000 each. Most of these judgements will bear interest at 4% as authorized by Section 3 of the Act. The aggregate loss to the Government will be considerable if it is necessary to await the expiration of the appeal date in each case."

With respect to payment of judgements, section 8, 41 Stat. 527, of the Suites in Admiralty Act provides:

"Sec. 8. That any final judgement rendered in any suit herein authorized, any final judgement within the purview of sections 4 and 7 of this Act, and any arbitration award or settlement had and agreed to under the provisions of section 9 of this Act, shall, upon the presentation of a duly authenticated copy thereof, be paid by the proper accounting officers of the United States out of any appropriation or insurance fund or other fund especially available therefor * * *."

After referring to the practice of entering upon the record of the court a stipulation, signed by the proctors of record for both parties, that no appeal will be taken by either libellant or respondent, the above- mentioned letter continues as follows:

"The above mentioned stipulation that no appeal will be taken which is entered in Court is a binding agreement by both parties not to take an appeal, and legally deprives them of the further time allowed to take an appeal as though the time within which an appeal could have been taken had expired."

"At the time of payment of judgements and before delivery of the checks, the Department of Justice and this office scrupulously adhere to the rule of requiring an entry of an order of satisfaction of the judgement by the Court. The order of satisfaction operates not only as a release of the United States from the claim, but cancels the judgement, and extinguishes the suit and cause of action. This order is considered to be absolute protection and is the document relied upon in paying judgements in private practice."

"Therefore, considering the language of the Suits in Admiralty Act, the binding effect of the stipulations entered in Court that no appeal will taken and the absolute protection afforded by the orders of satisfaction of the judgements entered by the courts, the rights of the United States are unquestionably protected."

"As you are aware, sometimes the 3 months' period has expired or nearly so before the parties can decide the question as to whether an appeal will be taken from the District Court to the Circuit Court of Appeals or whether an appeal will be taken from the District Court to the Circuit Court of Appeals or whether a writ of certiorari will be applied for from a decision of the Circuit Court of Appeals to the Supreme Court, especially in major complicated cases. It is only the cases where decision not to take an appeal is made promptly and the consent decrees mentioned above which are covered by the present suggestions."

"There are many of these admiralty judgements where the United States is the judgement creditor and the collecting party. The private parties paying the Government do not await the expiration of the appeal date to satisfy the judgement if decision not to take an appeal has been made prior thereto. In view of the rule in private practice to pay judgements as soon as it is decided not to take an appeal, the withholding payment by Government has always been a constant source of misunderstanding by private litigants."

The term "final judgement" is susceptible of distinct and separate meanings, so that it has been said a consideration of the abstract term "will simply dead to uncertainty and confusion." Twin Ports Oil Co. v. Pure Oil Co. et al. (D.C. Minn.) 26 F. Supp. 366, 368. As used in a particular statute, the term may relate to a determination of the Merits of the case from which an appeal will lie (as distinguished from an interlocutory judgement or order), or to a determination which has become conclusive by reason of expiration of the time for filing an appeal. Ibid. Having in mind the restriction frequently imposed by the Congress in making an appropriation for the payment of judgements, that payment shall not be made "until the right of appeal shall have expired," except where the judgement has become "final and conclusive against the United States by failure of the parties to appeal or otherwise," there would seem to be little reason to doubt that the term "final judgement" as used in the above-quoted section was intended to relate to such judgements as have become conclusive by reason of loss of the right of appeal -- by expiration of time or otherwise -- or by determination of the appeal by the court of last resort.

However, the purpose of restricting to "final judgements" those which may be paid under section 8 of the Suits in Admiralty Act is, obviously, the protection of the United States against loss by premature payment of a judgement which might latter be subject to amendment or reversal. Clearly, the United States gains nothing by continuing to pay interest until expiration of the time for filing an appeal if prior to that date the rights of the parties are determined conclusively by action which bars an appeal. Thus, it has been held that a consent judgment properly is payable before expiration of the time for filing an appeal, upon the basis that no appeal will lie therefrom. 4 Comp. Gen. 834. It was there said that --

"* * * It will not be presumed that the Congress intended the general prohibition, which is usually inserted in all appropriations for the payment of judgements, to operate to delay payment for six months from date of final decree in a case, such as the instant case, where the United States does not have the right of appeal and when the Attorney General of the United States reports that no appeal will be attempted on the part of the Government."

The same consideration would be applicable in cases of the type here under discussion if, as stated by the General Counsel for the Maritime Commission, the United States has lost the right of appeal in such cases.

It appears that a majority of the courts have adopted the view that a stipulation not to appeal from a judgement is binding upon the parties, and will result in dismissal of an attempted appeal. Elwell v. Fosdick, 134 U.S. 500; United States Counsel. Seeded Raisin Co. v. Chaddock & Co., 173 Fed. 577 (C.C.A. 9th 1909), certiorari denied, 215 U.S. 591; Brown v. Brown, 172 N.E. 416 (Ohio App. 1930); Worthington v. Osborn, 215 S.W. 700 (Ark., 1919). Cf. Kane v. Rexy Theatres Corporation, 63 F. 2d 754, 756, (C.C.A. 2d 1933). While the fact that the rule does not appear to have been universally accepted may give rise to sore doubt as to the advisability of applying it to the cases at hand, there would appear to be no doubt whatever that acceptance of payment of a money judgement in such cases would operate as a complete bar to any further action by the plaintiff. United States and City of New York v. Benedict, 261 U.S. 294; In re Denny, 135 F. 2d 184 (C.C.A. 7th 1943); Kaiser v. Standard Oil Co. of New Jersey, 89 F. 2d 58 (C.C.A. 5th 1937); Smith v. Morris, 69 F. 2d 3 (C.C.A. 3rd, 1934); The Velma L. Hamblin, 40 F. 2d 852 (C.C.A. 4th, 1930). Cf. United States v. Flower et al. 108 F. 2d 298 (C.C.A. 8th, 1939). In light of this rule, the possibility of any further action by the plaintiff in connection with a judgement on which payment has been made by the United States under the circumstances here considered would be extremely remote, and thus there would appear to be no substantial reason why the stipulation of the parties not to appeal (when executed on behalf on the United States after determination by the proper officers of your department that the judgement is not to be appealed) should not be regarded as giving to the judgement of the lower court the effect of a "final judgement" in the sense that it becomes a conclusive determination of the units of the case from which no appeal will lie.

There may, of course, be instances in which the terms of the judgement itself will preclude the adoption of the view suggested above. For example, in the case of Charles J. Dick v. United States, Admiralty No. 680, in the District Court of the United States for the Southern District of Texas (Houston Division) the amended final decree entered March 23, 1946, provided that the libellant recover from the United States the sum of $21,148.35, with interest thereon from February 27, 1943, until paid, and costs in the amount of $305.10, as the result of a collision involving the steam tanker Ormondale, owned by and operated for the account of the War Shipping Administration. The decree provided further that the amount awarded by paid by the United States, as provided by section 8 of the Suits in Admiralty Act, "unless an appeal be taken within the time provided by statute therefor." Thus, while the statute provides for the payment of the judgement in that case was by the decree itself expressly conditioned upon the expiration of the time for filing an appeal.

Since the question of whether an appeal should be filed on behalf of the United States in such cases is a matter under your cognizance, and since it is not proposed in any event to accept a stipulation not to appeal as effecting a final judgement unless the record contains evidence that the Solicitor General has directed that no appeal be taken, I would appreciate an expression of your views before replying to the letter from the Maritime Commission.

Respectfully,

(Signed) Frank L Yates Acting Comptroller General of the United States