B-148340, APR. 2, 1962

B-148340, APR. 2, 1962

TO MR. OSWALD EVAN PERKINS:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 19, 1962, REQUESTING RECONSIDERATION OF THE ACTION TAKEN BY OUR CLAIMS DIVISION UNDER DATE OF FEBRUARY 9, 1962, IN DISALLOWING YOUR CLAIM FOR INTEREST ON THE AMOUNT WHICH HAD BEEN PAID TO YOU PURSUANT TO THE PROVISIONS OF PUBLIC LAW 561, APPROVED JUNE 4, 1956, 70 STAT. 245, REPRESENTING PAY AND ALLOWANCES FOR THE PERIOD JULY 7, 1949, TO AUGUST 15, 1950, INCLUSIVE, INCIDENT TO YOUR APPOINTMENT AS SECOND LIEUTENANT IN THE REGULAR ARMY.

THE RECORD SHOWS THAT YOU WERE APPOINTED A SECOND LIEUTENANT IN THE REGULAR ARMY BY ORDERS OF MAY 6, 1949, WITH DATE OF RANK JUNE 15, 1949; THAT THIS COMMISSION WAS ACCEPTED BY YOU ON JULY 7, 1949, AND THAT YOU WERE ORDERED TO ACTIVE DUTY EFFECTIVE AUGUST 16, 1950. ORDERS OF JULY 29, 1949, PURPORTED TO REVOKE THE ORDERS OF MAY 6, 1949, APPOINTING YOU IN THE REGULAR ARMY, BUT THE REVOKING ORDERS WERE REVOKED BY FURTHER ORDERS DATED MAY 9, 1951.

IN ORDER TO CORRECT INEQUITIES ARISING FROM AN INTERPRETATION OF THE LAWS THEN IN EFFECT, UNDER WHICH SOME OFFICERS IN CIRCUMSTANCES SUCH AS YOURS HAD BEEN PAID ACTIVE DUTY PAY AND ALLOWANCES FOR THE PERIOD AFTER APPOINTMENT IN THE REGULAR ARMY WHILE AWAITING ORDERS TO ACTIVE DUTY AND OTHERS HAD NOT BEEN SO PAID, CONGRESS ENACTED PUBLIC LAW 561, TO VALIDATE THE PAYMENTS ALREADY MADE AND TO AUTHORIZE SUCH PAYMENTS TO OFFICERS WHO HAD NOT BEEN PREVIOUSLY PAID. ACCORDINGLY, UPON PRESENTATION OF YOUR CLAIM TO OUR OFFICE YOU WERE ALLOWED THE SUM OF $3,399.20 AS PAY AND ALLOWANCES FOR THE PERIOD JULY 7, 1949, TO AUGUST 15, 1950, INCLUSIVE.

YOU CONTEND THAT THE AMOUNT SO PAID TO YOU ACTUALLY BECAME YOUR "PROPERTY" ON MAY 9, 1951, THE DATE OF THE LAST REVOCATION ORDER, AND THAT THE WITHHOLDING OF SUCH AMOUNT FROM THAT DATE UNTIL IT WAS PAID TO YOU IN NOVEMBER 1958 CONSTITUTED A TAKING OF YOUR PRIVATE PROPERTY WITHOUT JUST COMPENSATION IN CONTRAVENTION OF THE FIFTH AMENDMENT TO THE CONSTITUTION OF THE UNITED STATES WHICH PROVIDES THAT:

"NO PERSON SHALL * * * BE DEPRIVED OF * * * PROPERTY, WITHOUT DUE PROCESS OF LAW; NOR SHALL PRIVATE PROPERTY BE TAKEN FOR PUBLIC USE, WITHOUT JUST COMPENSATION.'

ALL OF THE ARGUMENTS PRESENTED IN YOUR LETTER OF FEBRUARY 19, 1962, HAVE BEEN CAREFULLY CONSIDERED AND IT APPEARS THAT THE ONLY CONTROVERSY IN THIS CASE IS THAT ARISING FROM YOUR THEORY THAT SINCE THE PAY AND ALLOWANCES INVOLVED LOST THEIR CHARACTER AS "PAY AND ALLOWANCES" UPON ISSUANCE BY THE DEPARTMENT OF THE ARMY OF THE REVOCATION ORDER OF MAY 9, 1951, AND BECAME YOUR PROPERTY, YOU ARE ENTITLED TO DAMAGES (INTEREST) FOR THE DELAY IN DELIVERING SUCH PROPERTY TO YOU. YOUR SITUATION IS NOT DIFFERENT FROM THAT OF MANY OTHERS WHO HAVE NOT BEEN PROMPTLY PAID THE FULL AMOUNT OF PAY AND ALLOWANCES OR COMPENSATION TO WHICH THEY WERE ENTITLED, EITHER THROUGH OVERSIGHT OR BECAUSE OF UNCERTAINTY AS TO THE PROPER INTERPRETATION OF APPLICABLE PROVISIONS OF LAW AND REGULATIONS. THE DELAY IN PAYMENT IN SUCH CASES DOES NOT CONSTITUTE A TAKING WITHIN THE MEANING OF THE FIFTH AMENDMENT AND WHEN THE FULL AMOUNT DUE IS PAID, THE PERSON INVOLVED HAS NO FURTHER CLAIM AGAINST THE GOVERNMENT.

THE CASE REFERRED TO BY YOU, PUMPELLY V. GREEN BAY COMPANY, 80 U.S. 166, DEALT EXCLUSIVELY WITH REAL PROPERTY OWNED BY THE PLAINTIFF WHICH WAS RENDERED USELESS BY THE ACT WHICH HAD BEEN PERFORMED IN THE PUBLIC INTEREST, IN THAT CASE THE CONSTRUCTION OF A DAM WHICH FLOODED PLAINTIFF'S LAND. SUCH LAND WAS REGARDED AS HAVING BEEN TAKEN BY THE GOVERNMENT. THE AMOUNT OF DAMAGES WAS NOT DECIDED IN THAT CASE SINCE THAT QUESTION WAS NOT BEFORE THE COURT AND NOTHING WAS SAID IN THE COURT'S DECISION WHICH INDICATED THAT DAMAGES IN EXCESS OF THE VALUE OF THE LAND COULD BE AWARDED AS A RESULT OF THE GOVERNMENT'S ACTION.

RELATIVE TO THE QUESTION OF ACCRUAL OF INTEREST ON A CLAIM AGAINST THE UNITED STATES, THE SUPREME COURT IN 1888 RULED IN THE CASE OF ANGARICA V. BAYARD, 127 U.S. 251:

"THE CASE, THEREFORE, FALLS WITHIN THE WELL-SETTLED PRINCIPLE, THAT THE UNITED STATES ARE NOT LIABLE TO PAY INTEREST ON CLAIMS AGAINST THEM, IN THE ABSENCE OF EXPRESS STATUTORY PROVISION TO THAT EFFECT. IT HAS BEEN ESTABLISHED, AS A GENERAL RULE, IN THE PRACTICE OF THE GOVERNMENT, THAT INTEREST IS NOT ALLOWED ON CLAIMS AGAINST IT, WHETHER SUCH CLAIMS ORIGINATE IN CONTRACT OR IN TORT, AND WHETHER THEY ARISE IN THE ORDINARY BUSINESS OF ADMINISTRATION OR UNDER PRIVATE ACTS OF RELIEF, PASSED BY CONGRESS ON SPECIAL APPLICATION. THE ONLY RECOGNIZED EXCEPTIONS ARE, WHERE THE GOVERNMENT STIPULATES TO PAY INTEREST AND WHERE INTEREST IS GIVEN EXPRESSLY BY AN ACT OF CONGRESS, EITHER BY THE NAME OF INTEREST OR BY THAT OF DAMAGES.'

THE GENERAL RULE, AS STATED ABOVE, HAS NEVER BEEN REVERSED. SEE, ALSO, SMYTH V. UNITED STATES, 302 U.S. 329; UNITED STATES V. THAYER WEST POINT HOTEL COMPANY, 329 U.S. 585, AND OTHER CASES CITED THEREIN. 28 U.S.C. 2516 (A) PROVIDES THAT "INTEREST ON A CLAIM AGAINST THE UNITED STATES SHALL BE ALLOWED IN A JUDGMENT OF THE COURT OF CLAIMS ONLY UNDER A CONTRACT OR ACT OF CONGRESS EXPRESSLY PROVIDING FOR PAYMENT THEREOF.'

SINCE PAYMENT OF THE PAY AND ALLOWANCES INVOLVED WAS ACCOMPLISHED UNDER AUTHORITY CONTAINED IN THE ACT OF JUNE 4, 1956, AND THAT ACT INCLUDED NO PROVISION FOR PAYMENT OF INTEREST, THERE IS NO AUTHORITY OF LAW UNDER WHICH INTEREST MAY BE PAID TO YOU. THE DISALLOWANCE OF YOUR CLAIM, THEREFORE, IS SUSTAINED.

CONCERNING YOUR INQUIRY AS TO THE FINALITY OF THE DECISIONS OF THIS OFFICE, YOU ARE ADVISED THAT SUCH DECISIONS ARE FINAL AND CONCLUSIVE UPON THE EXECUTIVE BRANCH OF THE GOVERNMENT. SEE 31 U.S.C. 71, 74.