B-143673, APR 19, 1974, 53 COMP GEN 782

B-143673, APR 19, 1974, 53 COMP GEN 782

COURTS - JUDGMENTS, DECREES, ETC. - COMPROMISES - PERMANENT INDEFINITE APPROPRIATIONS - AVAILABILITY JUDGMENTS AND COSTS (OR COMPROMISE SETTLEMENTS) ASSESSED AGAINST INDIVIDUAL INTERNAL REVENUE SERVICE EMPLOYEES DETERMINED TO HAVE BEEN ACTING WITHIN THE SCOPE OF THEIR EMPLOYMENT ARE PAYABLE FROM THE INDEFINITE APPROPRIATION ESTABLISHED BY 31 U.S.C. 724A IF NOT OVER $100,000 IN EACH CASE, BUT FUNDS MUST BE APPROPRIATED SPECIFICALLY FOR THAT PURPOSE IF THE AMOUNT EXCEEDS $100,000, AND IN EITHER CASE, THE JUDGMENT MUST BE REGARDED AS AN OBLIGATION OF THE UNITED STATES.

IN THE MATTER OF AVAILABILITY OF FUNDS TO PAY JUDGMENTS AGAINST INTERNAL REVENUE SERVICE EMPLOYEES, APRIL 19, 1974:

THIS DECISION TO THE SECRETARY OF THE TREASURY IS IN RESPONSE TO A REQUEST FROM THE ASSISTANT SECRETARY FOR ADMINISTRATION, DEPARTMENT OF THE TREASURY, CONCERNING THE AVAILABILITY OF FUNDS TO PAY DAMAGES AND COSTS WHICH MAY BE ASSESSED AGAINST INDIVIDUAL EMPLOYEES OF THE INTERNAL REVENUE SERVICE (IRS) IN THE CASE OF W.P. DOBBS, BRYAN T. DOBBS V. WSB TELEVISION AND RADIO, ET AL., CIVIL NO. 18151 (N.D. GA.).

ACCORDING TO THE INFORMATION PRESENTED TO US, A MOTION TO DISMISS THE COMPLAINT HAS BEEN DENIED BY THE DISTRICT COURT. BEFORE PROCEEDING WITH THE TRIAL, DEPARTMENT OF JUSTICE ATTORNEYS ASKED THE DEPARTMENT OF THE TREASURY WHETHER IT WOULD BE ABLE TO PAY A COMPROMISE SETTLEMENT OR FINAL JUDGMENT RENDERED AGAINST DEFENDANTS.

THE FACTS AS RELATED TO US ARE AS FOLLOWS: PLAINTIFFS ARE IN THE BUSINESS OF PREPARING TAX RETURNS FOR CLIENTS. THEY ALLEGE THAT THE DEFENDANT IRS AGENTS INVADED THEIR RIGHT TO PRIVACY BY SUBJECTING THEM TO HUMILIATING AND PREJUDICIAL MEDIA AND PRESS PUBLICITY IN THE COURSE OF ARRESTING THE PLAINTIFFS FOR ALLEGEDLY PREPARING FALSE INCOME TAX RETURNS IN VIOLATION OF INTERNAL REVENUE LAWS. THE DEFENDANT AGENTS STATE THAT THEIR ACTIONS WERE IN ACCORDANCE WITH IRS POLICIES AND DIRECTIVES TO GIVE MAXIMUM PUBLICITY TO SUCH ARRESTS AS A DETERRENT TO OTHER POTENTIAL OFFENDERS. THE TREASURY DEPARTMENT APPARENTLY SUPPORTS THAT CONTENTION. IT HAS DETERMINED ADMINISTRATIVELY THAT "EMPLOYEE DEFENDANTS WERE AT ALL TIMES ACTING IN THE OFFICIAL PERFORMANCE OF THEIR DUTIES UNDER THE INTERNAL REVENUE CODE." APPROPRIATE DEPARTMENT OF JUSTICE OFFICIALS CONCUR IN THIS DETERMINATION.

THE ASSISTANT SECRETARY NOTES THAT APPROPRIATIONS AVAILABLE TO IRS DO NOT PROVIDE AUTHORITY FOR THE PAYMENTS OF JUDGMENTS AND ASKS OUR ADVICE AS TO WHETHER THE PERMANENT INDEFINITE APPROPRIATION FOR THE PAYMENT OF JUDGMENTS NOT OTHERWISE PROVIDED FOR, ESTABLISHED BY 31 U.S.C. 724A, WOULD BE AVAILABLE TO PAY A FINAL JUDGMENT FOR DAMAGES AND COSTS THAT MAY BE RENDERED AGAINST INDIVIDUL IRS EMPLOYEES IN THIS CASE.

INASMUCH AS THE IRS EMPLOYEES HAVE BEEN ADMINISTRATIVELY DETERMINED TO HAVE BEEN PERFORMING THEIR OFFICIAL DUTIES WHEN THE ACTIONS GIVING RISE TO THIS SUIT ARE ALLEGED TO HAVE OCCURRED THERE IS FOR CONSIDERATION 26 U.S.C. 7423 WHICH PROVIDES THAT -

THE SECRETARY OR HIS DELEGATE, SUBJECT TO REGULATIONS PRESCRIBED BY THE SECRETARY OR HIS DELEGATE, IS AUTHORIZED TO REPAY -

(2) DAMAGES AND COSTS.

ALL DAMAGES AND COSTS RECOVERED AGAINST ANY OFFICER OR EMPLOYEE OF THE UNITED STATES IN ANY SUIT BROUGHT AGAINST HIM BY REASON OF ANYTHING DONE IN THE DUE PERFORMANCE OF HIS OFFICIAL DUTY UNDER THIS TITLE.

CONCERNING THE ABOVE PROVISION OF LAW, WE STATED IN 40 COMP. GEN. 95 (1960) THAT SUCH PROVISION CLEARLY WAS INTENDED TO EXEMPT ANY GOVERNMENT OFFICER OR EMPLOYEE FROM LIABILITY FOR CIVIL DAMAGES RECOVERED AGAINST HIM IN THE PERFORMANCE OF OFFICIAL DUTY IN RELATION TO THE GENERAL MATTERS CONCERNING ADMINISTRATION OF THE INTERNAL REVENUE LAWS. WE FURTHER STATED THAT THIS STATUTE FOR ALL PRACTICAL PURPOSES CONVERTS JUDGMENTS RENDERED AGAINST INDIVIDUAL EMPLOYEES INTO JUDGMENT OBLIGATIONS OF THE UNITED STATES. ACCORDINGLY, AND SINCE NO APPROPRIATIONS OF IRS WERE AVAILABLE TO PAY JUDGMENTS AGAINST THE EMPLOYEES THERE INVOLVED IN THE AMOUNT OF $400 EACH, PAYMENTS OF THOSE JUDGMENTS WERE AUTHORIZED TO BE EFFECTED FROM THE INDEFINITE APPROPRIATION ESTABLISHED BY 31 U.S.C. 724A.

IN ACCORDANCE WITH THAT DECISION, WE SEE NO REASON WHY A JUDGMENT WHICH MAY BE RENDERED AGAINST AN INDIVIDUAL IRS EMPLOYEE IN THIS CASE PROPERLY MAY NOT BE PAID FROM SUCH APPROPRIATION PROVIDED, OF COURSE, THAT SUCH JUDGMENT IS WITHIN THE MAXIMUM LIMITATION OF $100,000 PRESCRIBED IN 31 U.S.C. 724A. IF THE INDIVIDUAL JUDGMENT EXCEEDS $100,000, IT WILL BE NECESSARY TO REQUEST A SPECIFIC APPROPRIATION FOR PAYMENT OF THE JUDGMENT FROM THE CONGRESS.

SINCE PURSUANT TO 28 U.S.C. 2414 THE PERMANENT INDEFINITE APPROPRIATION IS AVAILABLE FOR ANY COMPROMISE SETTLEMENTS THAT MAY BE EFFECTED IN THIS CASE BY THE ATTORNEY GENERAL, WHAT IS SAID ABOVE WITH RESPECT TO THE PAYMENT OF JUDGMENTS WOULD BE EQUALLY APPLICABLE TO SUCH COMPROMISE SETTLEMENTS.