B-73249, FEBRUARY 10, 1948, 27 COMP. GEN. 445

B-73249: Feb 10, 1948

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" ONLY THE APPROPRIATION CURRENT AT THE TIME THE GOVERNMENT'S LIABILITY WITH RESPECT TO A TORT CLAIM FINALLY IS DETERMINED IS THE ONE OBLIGATED FOR AND CHARGEABLE WITH THE AMOUNT OF THE SETTLED CLAIM. 27 COMP. 1948: REFERENCE IS MADE TO YOUR LETTER OF JANUARY 29. IN WHICH IT WAS HELD THAT THE APPROPRIATION CURRENT AT THE TIME THE HEAD OF A FEDERAL AGENCY FINALLY DETERMINES THE GOVERNMENT'S LIABILITY WITH RESPECT TO A CLAIM UNDER SECTION 403 (A) OF THE FEDERAL TORT CLAIMS ACT. IS THE APPROPRIATION OBLIGATED FOR AND CHARGEABLE WITH THE AMOUNT OF THE SETTLED CLAIM. IT IS STATED. THIS PROCEDURE WAS PREDICATED UPON PRIOR DECISIONS OF THE COMPTROLLER GENERAL. RATHER THAN AT THE TIME ANY DISPUTE AS TO THE EXISTENCE OR EXTENT OF THAT OBLIGATION IS SETTLED BY COMPETENT AUTHORITY.

B-73249, FEBRUARY 10, 1948, 27 COMP. GEN. 445

APPROPRIATIONS - FISCAL YEAR - SETTLEMENTS UNDER FEDERAL TORT CLAIMS ACT UNDER SECTION 403 OF THE FEDERAL TORT CLAIMS ACT, WHICH, IN PROVIDING FOR THE ADMINISTRATIVE ADJUSTMENT OF TORT CLAIMS, DID NOT APPROPRIATE FUNDS OR AUTHORIZE THE USE OF GENERAL APPROPRIATIONS THERETOFORE MADE FOR THE PAYMENT OF SUCH CLAIMS, BUT MERELY PROVIDED FOR THE USE OF APPROPRIATIONS ,THAT MAY BE MADE," ONLY THE APPROPRIATION CURRENT AT THE TIME THE GOVERNMENT'S LIABILITY WITH RESPECT TO A TORT CLAIM FINALLY IS DETERMINED IS THE ONE OBLIGATED FOR AND CHARGEABLE WITH THE AMOUNT OF THE SETTLED CLAIM. 27 COMP. GEN. 237, AMPLIFIED. FUNDS APPROPRIATED TO THE NAVY DEPARTMENT FOR USE IN SETTLING TORT CLAIMS COGNIZABLE UNDER THE REPEALED PROVISIONS OF THE ACT OF DECEMBER 28, 1945, MAY BE REGARDED AS AVAILABLE UNTIL JULY 1, 1948, FOR THE PAYMENT OF CLAIMS UNDER THE SUPERSEDING PROVISIONS OF THE FEDERAL TORT CLAIMS ACT IN THE SAME MANNER AS UNDER THE 1945 ACT, ON THE BASIS OF OBLIGATION AT THE TIME SUCH LIABILITIES ACCRUED. FUNDS ORIGINALLY APPROPRIATED TO THE NAVY DEPARTMENT FOR THE PAYMENT OF TORT CLAIMS UNDER THE REPEALED PROVISIONS OF THE ACT OF DECEMBER 28, 1945, MAY BE USED UNTIL JULY 1, 1948, TO PAY FOR PAIN AND SUFFERING AND ALLIED ELEMENTS OF DAMAGE COMPENSABLE ONLY UNDER THE SUPERSEDING PROVISIONS OF THE FEDERAL TORT CLAIMS ACT.

ACTING COMPTROLLER GENERAL YATES TO THE SECRETARY OF THE NAVY, FEBRUARY 10, 1948:

REFERENCE IS MADE TO YOUR LETTER OF JANUARY 29, 1948, CONCERNING DECISION OF OCTOBER 23, 1947, B-70113 (27 COMP. GEN. 237), IN WHICH IT WAS HELD THAT THE APPROPRIATION CURRENT AT THE TIME THE HEAD OF A FEDERAL AGENCY FINALLY DETERMINES THE GOVERNMENT'S LIABILITY WITH RESPECT TO A CLAIM UNDER SECTION 403 (A) OF THE FEDERAL TORT CLAIMS ACT, 60 STAT. 842, AS AMENDED BY THE ACT APPROVED AUGUST 1, 1947, PUBLIC LAW 324, 80TH CONGRESS, IS THE APPROPRIATION OBLIGATED FOR AND CHARGEABLE WITH THE AMOUNT OF THE SETTLED CLAIM.

YOU REQUEST THAT THE SAID DECISION EITHER (1) BE MODIFIED TO PERMIT ALTERNATIVE PAYMENT FROM THE APPROPRIATION CURRENT AT THE TIME THE CAUSE OF ACTION AROSE, OR (2) THAT ITS APPLICATION TO THE DEPARTMENT OF THE NAVY BE DEFERRED UNTIL THE COMMENCEMENT OF THE NEXT FISCAL YEAR ON JULY 1, 1948. AS A BASIS FOR SUCH REQUEST, IT IS STATED, IN PART, AS FOLLOWS:

THE NAVY DEPARTMENT HAS HERETOFORE PAID TORT CLAIMS, UNDER THE AUTHORITY GRANTED BY THE ACT OF DECEMBER 28, 1945 (59 STAT. 662, 31 U.S.C. 223D ( SUPP. 1946), AND THE ACT OF JULY 11, 1919 (41 STAT. 132, 34 U.S.C. 600), FROM THE AVAILABLE APPROPRIATIONS CURRENT AT THE TIME THE CAUSE OF ACTION AROSE. THIS PROCEDURE WAS PREDICATED UPON PRIOR DECISIONS OF THE COMPTROLLER GENERAL, AND SUPPORTED BY THE GENERALLY ACCEPTED LEGAL THEORY THAT THE OBLIGATION OF A TORTFEASOR TO RESPOND IN DAMAGES ACCRUES AT THE TIME OF THE TORT, RATHER THAN AT THE TIME ANY DISPUTE AS TO THE EXISTENCE OR EXTENT OF THAT OBLIGATION IS SETTLED BY COMPETENT AUTHORITY.

IN THE DECISION OF OCTOBER 23, 1947, IT IS STATED THAT "THERE IS NO OBLIGATION ON THE PART OF THE UNITED STATES FOR THE PAYMENT OF ANY AMOUNT ON A CLAIM COVERED BY * * * ( SECTION 403 (A) OF THE FEDERAL TORT CLAIMS ACT) UNTIL A FINAL DETERMINATION OF THE GOVERNMENT'S LIABILITY IS MADE BY THE PERSON AUTHORIZED TO DO SO THEREUNDER * * *.' IT IS ALSO NOTED THAT YOUR DECISION TERMS THE AUTHORITY OF THE HEAD OF EACH FEDERAL AGENCY UNDER THE FEDERAL TORT CLAIMS ACT AS "DISCRETIONARY.' THE WORD "DISCRETIONARY" WAS NOT USED BY THE CONGRESS IN THE ACT ITSELF. IT IS SUBMITTED THAT THE CONGRESS INTENDED AN OBLIGATION ON THE PART OF THE GOVERNMENT TO ARISE AT THE TIME OF THE TORTIOUS ACT OF ITS AGENT, IRRESPECTIVE OF ANY DISCRETIONARY ACTION OF THE HEAD OF THE FEDERAL AGENCY CONCERNED. DEFINITE CAUSE OF ACTION WAS GIVEN TO THE CLAIMANT, ARISING AT THE TIME OF THE TORT, AND SUIT MAY BE BROUGHT TO ENFORCE THAT CAUSE OF ACTION IN THE COURTS WITHOUT REGARD TO THE ADMINISTRATIVE MACHINERY SET UP IN AN EFFORT TO EFFECT A MORE EXPEDITIOUS AND LESS EXPENSIVE SETTLEMENT. IN SECTION 420 OF THE ACT, THE CONGRESS PROVIDED THAT ANY CLAIM WOULD BE BARRED UNLESS PRESENTED ADMINISTRATIVELY OR UNLESS SUIT WAS FILED "WITHIN ONE YEAR AFTER SUCH CLAIM ACCRUED.' IN SECTION 403 (A), THE DATE OF ACCRUAL OF A CLAIM WAS MADE A FACTOR IN DETERMINING WHAT CLAIMS WERE TO BE COGNIZABLE UNDER THE ACT. IF A CLAIM ACCRUES AND THERE EXISTS A CAUSE OF ACTION AGAINST THE GOVERNMENT, THERE MUST ALSO BE A CORRESPONDING OBLIGATION ON THE PART OF THE GOVERNMENT, ARISING AT THE SAME MOMENT, TO RESPOND IN DAMAGES.

IT IS GENERALLY RECOGNIZED THAT A CAUSE OF ACTION ACCRUES TO THE INJURED PARTY AT THE TIME OF THE TORT; THAT ANY STATUTORY LIMITATION PERIOD ON THE RIGHT OF ACTION RUNS FROM THE TIME OF THE TORT; THAT THE MEASURE OF PROPERTY DAMAGE IS DETERMINED AS OF THE TIME OF THE TORT ( UNITED STATES V. ST. ANTHONY R.CO., 192 U.S. 524 (1904) ); AND THAT INTEREST ON THE VALUE OF PROPERTY INJURED, LOST, OR DESTROYED, RUNNING FROM THE TIME THE INJURY OCCURRED, MAY BE AWARDED AS AN ITEM OF DAMAGES ( THE EL MONTE, 252 FED. 59 ( C.C.A. 5TH 1918), CERT. DENIED, 248 U.S. 573 (1918); CLARKE V) EUREKA COUNTY BANK, 123 FED. 922 ( C.C.NEV. 1903), AFF-D, 130 FED. 325 ( C.C.A. 9TH 1904), CERT. DENIED, 195 U.S. 631 (1904); ARKANSAS VALLEY LAND AND CATTLE CO. V. MANN, 130 U.S. 69 (1889) ). IN THE EL MONTE CASE, SUPRA, THE COURT SAID:"AS THE PARTY RESPONSIBLE FOR THE DAMAGES RESULTING FROM THE COLLISION BECAME LIABLE WHEN IT OCCURRED, INTEREST ON THE ACCOUNT OF SUCH DAMAGES, IF NOT THEN PAID, WAS ALLOWABLE FROM THAT DATE.' THE CONGRESS, IN ENACTING THE FEDERAL TORT CLAIMS ACT, RECOGNIZED THAT THE OBLIGATION ON THE PART OF A TORT-FEASOR TO RESPOND IN DAMAGES AROSE AT THE TIME OF THE TORT IN SUCH A FASHION AS TO RENDER THE TORT-FEASOR LIABLE FOR INTEREST FROM THAT TIME. IN SECTION 410 (A) OF THE ACT, THE CONGRESS EXPRESSLY RESERVED SOVEREIGN IMMUNITY IN THIS REGARD IN THE FOLLOWING WORDS: "* * * THE UNITED STATES SHALL BE LIABLE IN RESPECT OF SUCH CLAIMS TO THE SAME CLAIMANTS, IN THE SAME MANNER, AND TO THE SAME EXTENT AS A PRIVATE INDIVIDUAL UNDER LIKE CIRCUMSTANCES, EXCEPT THAT THE UNITED STATES SHALL NOT BE LIABLE FOR INTEREST PRIOR TO JUDGMENT * * *.' ( ITALICS SUPPLIED.)

THE THEORY OF APPROPRIATION AVAILABILITY REPRESENTED BY DECISION B 70113 OF OCTOBER 23, 1947, MAY HAVE A SERIOUSLY ADVERSE EFFECT UPON THE NAVY DEPARTMENT. PRIOR TO THE ENACTMENT OF THE FEDERAL TORT CLAIMS ACT, THE NAVY DEPARTMENT HAD AUTHORITY TO SETTLE TORT CLAIMS UNDER THE ACT OF DECEMBER 28, 1945 (59 STAT. 662, 31 U.S.C. 223D ( SUPP. 1946) (, MAKING APPLICABLE TO THE NAVY DEPARTMENT THE PROVISIONS OF THE ACT OF JULY 3, 1943 (57 STAT. 372, 31 U.S.C. 223B ( SUPP. 1946) (, AS AMENDED. THE ACT OF DECEMBER 28, 1945, MADE ANY APPROPRIATION AVAILABLE TO THE NAVY DEPARTMENT FURTHER AVAILABLE FOR THE PAYMENT OF SUCH CLAIMS. THIS PROVISION FOR THE PAYMENT OF CLAIMS WAS CONTINUED BY SECTION 111 OF THE " GENERAL PROVISIONS" OF THE NAVAL APPROPRIATION ACT FOR 1947 (60 STAT. 481, 497).

IN THE 1948 NAVAL APPROPRIATION ACT, UNDER THE HEADING " MISCELLANEOUS EXPENSES," HOWEVER, A $200,000 LIMITATION WAS PLACED ON THE AMOUNT APPROPRIATED FOR THE PAYMENT OF CLAIMS DETERMINED AND SETTLED PURSUANT TO THE FEDERAL TORT CLAIMS ACT * * *.

* * * THE NAVY DEPARTMENT HAS ALREADY EXCEEDED THE $200,000 LIMITATION BY PAYING MANY CLAIMS WHICH ACCRUED IN PRIOR YEARS. IF THIS DECISION REMAINS UNMODIFIED, IT WILL BE NECESSARY FOR THE NAVY DEPARTMENT, FOR THE BALANCE OF THE CURRENT FISCAL YEAR, TO CERTIFY TO YOUR OFFICE FOR REPORTING TO CONGRESS UNDER THE PROVISIONS OF 31 U.S.C. 714 ALL CLAIMS HEREAFTER SETTLED. IT IS SUBMITTED THAT IT WAS NOT THE INTENT OF THE CONGRESS, IN INTRODUCING THE $200,000 LIMITATION ON NAVY FEDERAL TORT CLAIMS ACT FUNDS, TO BRING ABOUT THIS RESULT. TO DO SO WOULD COMPLETELY DEFEAT THE PRINCIPAL OBJECTIVES OF THE CONGRESS IN PROVIDING FOR ADMINISTRATIVE SETTLEMENT UNDER THE FEDERAL TORT CLAIMS ACT--- TO WIT, THE SPEEDY AND ECONOMICAL ADJUDICATION AND SETTLEMENT OF SMALL CLAIMS, AND THE RELIEF OF CONGRESS FROM THE BURDEN OF CONSIDERING SUCH CLAIMS.

THE BASIC PREMISE OF YOUR CONTENTION--- THAT WHERE A CAUSE OF ACTION ACCRUES, THERE IMMEDIATELY COMES INTO EXISTENCE A CORRESPONDING LIABILITY TO RESPOND IN DAMAGES, AND THAT SUCH IS THE CASE UNDER THE FEDERAL TORT CLAIMS ACT--- IS NOT INCONSISTENT WITH THE RULE THAT AN APPROPRIATION OBLIGATION DOES NOT ARISE UNDER SECTION 403 (A) OF THE SAID ACT, 60 STAT. 843, UNTIL AN AWARD ACTUALLY IS MADE. DIFFERENT PROCEDURES ARE PROVIDED UNDER THE ACT FOR DISCHARGING THE LIABILITY OF THE UNITED STATES, DEPENDING UPON WHETHER AWARDS ARE MADE (1) BY THE HEAD OF A FEDERAL AGENCY, HIS DESIGNEE FOR THE PURPOSE, AND THE ATTORNEY GENERAL, OR (2) BY THE UNITED STATES DISTRICT COURTS. SECTION 403 (C), 60 STAT. 843, PROVIDES THAT AWARDS BY THE HEAD OF A FEDERAL AGENCY OR HIS DESIGNEE UNDER SECTION 403, AND COMPROMISE AWARDS BY THE ATTORNEY GENERAL PURSUANT TO SECTION 413, 60 STAT. 845,"SHALL BE PAID BY THE HEAD OF THE FEDERAL AGENCY CONCERNED OUT OF APPROPRIATIONS THAT MAY BE MADE THEREFOR," WHEREAS SECTION 411, 60 STAT. 844, PROVIDES THAT "THE SAME PROVISIONS * * * FOR PAYMENT OF JUDGMENTS, SHALL BE APPLICABLE AS IN CASES BROUGHT IN THE UNITED STATES DISTRICT COURTS UNDER THE ACT OF MARCH 3, 1887 (24 STAT. 505).' HENCE, UNLESS OR UNTIL AWARD IS MADE BY THE HEAD OF A FEDERAL AGENCY, HIS DESIGNEE, OR THE ATTORNEY GENERAL, THERE NOT ONLY IS LACKING A DEFINITE COMMITMENT, BUT THERE CAN BE NO ASSURANCE THAT THE LIABILITY EVER WILL CONSTITUTE AN OBLIGATION AGAINST A DEPARTMENTAL APPROPRIATION.

I AM NOT UNAWARE OF THE SETTLED RULES OF LAW WITH RESPECT TO THE ACCRUAL OF RIGHTS AND THE INCURRENCE OF LIABILITIES, OR OF THE TIME AN APPROPRIATION IS OBLIGATED UNDER VARYING CIRCUMSTANCES. BUT WHAT YOUR LETTER OVERLOOKS, AND WHAT PREVENTS THE APPLICATION HERE OF THOSE SETTLED RULES, WITHOUT MODIFICATION, IS THAT THE FEDERAL TORT CLAIMS ACT ESTABLISHED AN ENTIRELY NEW LIABILITY, AND ACTIVITY WITH RESPECT TO THE FEDERAL GOVERNMENT GENERALLY. IT DID NOT MAKE APPROPRIATIONS FOR THE PAYMENT OF SUCH CLAIMS NOR DID IT AUTHORIZE THE USE OF APPROPRIATIONS THERETOFORE MADE FOR GENERAL PURPOSE FOR THE PAYMENT OF TORT CLAIMS. MERELY AUTHORIZED THE USE OF APPROPRIATIONS "THAT MAY BE MADE" FOR THE PAYMENT OF SUCH CLAIMS. WHILE THE NAVY DEPARTMENT AND SEVERAL OTHER AGENCIES THERETOFORE HAD AUTHORITY TO SETTLE AND PAY CERTAIN TORT CLAIMS, THE VAST MAJORITY OF THE FEDERAL ESTABLISHMENTS DID NOT. NEVERTHELESS, SO FAR AS THE FEDERAL TORT CLAIMS ACT, AND APPROPRIATION ACTS MAKING FUNDS AVAILABLE FOR THE PAYMENT OF TORT CLAIMS BE INVOLVED, OBVIOUSLY ONE RULE MUST APPLY--- NOT ONE RULE FOR THE NAVY DEPARTMENT AND ANOTHER RULE FOR SOME OTHER AGENCY.

YOU WILL NOTE THAT UNDER SECTION 403 OF THE SUBJECT ACT AUTHORITY IS GRANTED TO SETTLE TORT CLAIMS ACCRUING ON AND AFTER JANUARY 1, 1945, ALTHOUGH THE ACT WAS NOT APPROVED UNTIL AUGUST 2, 1946, AND MOST OF THE AGENCIES OF THE GOVERNMENT DID NOT RECEIVE APPROPRIATIONS TO PAY TORT CLAIMS UNTIL THE FISCAL YEAR 1948--- JULY 1, 1947. UNDER THE RULE YOU ADVANCE CLAIMS WHICH ACCRUED ON AND AFTER JANUARY 1, 1945, AND PRIOR TO JULY 1, 1947, COULD NOT BE PAID OUT OF THOSE APPROPRIATIONS. IN FACT THEY COULD NOT NOW BE PAID, WITHOUT SUPPLEMENTAL APPROPRIATIONS SPECIFICALLY REFERRING TO PRIOR YEARS, AS THERE HAS NOT BEEN CALLED TO MY ATTENTION ANY AGENCY WHICH RECEIVED EXPRESS AUTHORITY, IN AN APPROPRIATION ACT, TO PAY TORT CLAIMS ACCRUING ON AND AFTER JANUARY 1, 1945.

HOWEVER, AND ALTHOUGH MODIFICATION OF THE DECISION OF OCTOBER 23, 1947, TO PERMIT ALTERNATIVE PAYMENT FROM THE APPROPRIATION CURRENT AT THE TIME THE CAUSE OF ACTION AROSE WOULD NOT BE PROPER UNDER THE CIRCUMSTANCES, THE PECULIAR SITUATION CONFRONTING THE DEPARTMENT OF THE NAVY WITH RESPECT TO FUNDS AVAILABLE TO PAY TORT CLAIMS WILL BE RECOGNIZED. AS IS INDICATED BY THE STATEMENTS IN YOUR LETTER, NO FUNDS WERE MADE AVAILABLE TO THE DEPARTMENT SPECIFICALLY FOR THE PAYMENT OF CLAIMS UNDER THE FEDERAL TORT CLAIMS ACT PRIOR TO THE FISCAL YEAR 1948, ALTHOUGH FUNDS HAD BEEN MADE AVAILABLE FOR CARRYING OUT THE PROVISIONS OF THE ACT OF DECEMBER 28, 1945, 59 STAT. 662, COVERING APPROXIMATELY SIMILAR CASES. AT THE SAME TIME, FOLLOWING THE REASONING ADOPTED IN 26 COMP. GEN. 149, IT IS REASONABLE TO REGARD THE LATTER FUNDS AS BEING AVAILABLE FOR THE PAYMENT OF CLAIMS UNDER THE SUPERSEDING FEDERAL TORT CLAIMS ACT IN THE SAME MANNER AS UNDER THE EARLIER LEGISLATION. UNDER THE CIRCUMSTANCES, THIS OFFICE WILL NOT BE REQUIRED TO OBJECT TO THEIR USE UNTIL JULY 1, 1948, WHERE OTHERWISE PROPER, FOR THE PURPOSE OF DISCHARGING TORT LIABILITIES ON THE BASIS OF OBLIGATION AT THE TIME SUCH LIABILITIES ACCRUED.

YOUR FURTHER REQUEST FOR ADVICE AS TO WHETHER THE FUNDS ORIGINALLY APPROPRIATED FOR THE PAYMENT OF TORT CLAIMS UNDER THE ACT OF DECEMBER 28, 1945, MAY BE USED UNTIL JULY 1, 1948, TO PAY FOR PAIN AND SUFFERING AND ALLIED ELEMENTS OF DAMAGE COMPENSABLE ONLY UNDER THE FEDERAL TORT CLAIMS ACT, IN ACCORDANCE WITH PRESENT PRACTICE, IS ANSWERED IN THE AFFIRMATIVE. 26 COMP. GEN. 149.