Schism v. U.S.

Decision Date31 August 1998
Docket NumberNo. 3:96CV349/RV.,3:96CV349/RV.
Citation19 F.Supp.2d 1287
PartiesWilliam O. SCHISM and Robert Reinlie, Plaintiffs, v. UNITED STATES of America and William Cohen as Secretary of Defense, Defendants.
CourtU.S. District Court — Northern District of Florida

J.D. Roy Atchison, U.S. Attorney Northern Dist. of Florida, Pensacola, FL, Shirley Wang, U.S. Dept. of Justice, Washington, DC, Martha Hirschfield, U.S. Dept. of Justice, Civil Div., Washington, DC, for U.S.

George Everette Day, Day and Meade, P.A., Fort Walton Beach, FL, for William O. Schism, Robert L. Reinley.

ORDER

VINSON, Chief Judge.

Pending is the defendants' motion for summary judgment. (doc. 62) Also pending are the plaintiffs' counter-motion for partial summary judgment (doc. 68) and the plaintiffs' motion to certify class representation. (doc. 45)

I. BACKGROUND

Plaintiffs William O. Schism and Robert L. Reinlie are retired veterans over 65 years of age, each of whom has served his country for over twenty years in the armed forces.1 They retired in 1979 and 1968, respectively. Plaintiffs bring this suit alleging breach of contract and violation of their Fifth Amendment right to due process.

According to the plaintiffs, they joined and remained in the United States armed forces on the basis of promises by the armed forces that they would receive free lifetime medical care for themselves and their dependents. Plaintiffs allege that the medical treatment as promised was not subject to the restrictions of Medicare and Social Security, and contend that such promises were part of recruiting manuals and other authoritative written representations.

Plaintiff Schism states in his affidavit that when he enlisted in the United States Navy in 1943 he was advised that he could retire at 20 years with free medical care for life. (doc. 67, ex. C) He was also advised of the availability of free medical care in boot camp. During his time in the Navy and the Air Force, Schism learned that the promise of free health care was common knowledge in the service. Plaintiff Reinlie states in his affidavit that when he entered the United States Army Air Corp in 1942, he was promised free lifetime medical care, and that such promises were also made in official recruiting documents. (doc. 67, ex. D)

The plaintiffs have also submitted affidavits from retired military men and women who served as recruiters for the Army and Navy before 1956. These former recruiters state in their affidavits that they counseled potential enlistees and reenlistees regarding the free medical care they would receive during service and after retirement. (doc. 67, ex. O, P, R, S, W). They also state that at the recruiting schools they attended, they were instructed to tell potential enlistees that after twenty years of service retirees would receive lifetime medical care for themselves and their dependents. Promises of lifetime medical care were also made after the enactment of Title 10, United States Code, Section 1074(b) in 1956. The plaintiffs have also submitted general written materials provided by the military service branches before 1956 which state that military retirees are entitled to medical treatment and hospitalization as a part of their retirement benefits.

The plaintiffs contend that the United States has breached its contract to provide them with free medical care as part of their retirement compensation.2 Plaintiffs allege that while the United States fulfilled its obligations under the "contract" for many years by providing free health care, access to health care has recently been revoked or limited, and the plaintiffs have been forced to rely on Medicare, requiring payments by them and resulting in unanticipated out-of-pocket expenses. The plaintiffs further contend that the government's deduction of money from their social security payments to pay for the Medicare benefits constitutes a seizure of their property which violates their due process rights under the Fifth Amendment. They seek an order requiring the United States to cease deducting payments from their retired pay and to provide plaintiffs and their dependents the unlimited free medical care for which they allegedly contracted.

In my earlier order ruling on the defendants' motion to dismiss, the defendants' motion to dismiss the plaintiffs' contractual claim under the Little Tucker Act was denied as to plaintiffs who began their service or made service decisions prior to the enactment of Section 1074 in 1956. The plaintiffs were also allowed to continue with their claim under the Fifth Amendment concerning an implied contractual vesting of their asserted retirees' benefits prior to 1956. Plaintiffs' claims of age discrimination and for mandamus were dismissed. Both sides have moved for summary judgment as a matter of law, recognizing that the material facts are not really disputed.

II. ANALYSIS
A. Summary Judgment Standard

A motion for summary judgment should be granted when "the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law." Rule 56(c), Fed.R.Civ.P. As the Supreme Court of the United States has instructed, "the plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265, 273 (1986); Everett v. Napper, 833 F.2d 1507, 1510 (11th Cir.1987).

However, summary judgment is improper "[i]f a reasonable fact finder could draw more than one inference from the facts, and that inference creates a genuine issue of material fact." Cornelius v. Highland Lake, 880 F.2d 348, 351 (11th Cir.1989), cert. denied, 494 U.S. 1066, 110 S.Ct. 1784, 108 L.Ed.2d 785 (1990). An issue of fact is "material" if it might affect the outcome of the case under the governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202, 211 (1986). It is "genuine" if the record taken as a whole could lead a rational trier of fact to find for the non-moving party. Id.; see also Matsushita Electric Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538, 552 (1986).

On summary judgment motion, the record and all inferences that can be drawn from it must be viewed in the light most favorable to the non-moving party. See Souran v. Travelers Ins. Co., 982 F.2d 1497, 1502 (11th Cir.1993). Nevertheless, the non-moving party must provide more than a mere "scintilla" of evidence supporting his position, for if the evidence is merely colorable, or is not significantly probative, summary judgment may be granted. Anderson, supra, 477 U.S. at 249-50, 106 S.Ct. at 2510-11, 91 L.Ed.2d at 212; Johnson v. Fleet Finance, Inc., 4 F.3d 946, 949 (11th Cir.1993). Furthermore, although the non-moving party must designate "specific facts showing that there is a genuine issue for trial," the court must consider the entire record in the case, not just those pieces of evidence which have been singled out for attention by the parties. See Hargett v. Valley Fed. Sav. Bank, 60 F.3d 754, 763 n. 9 (11th Cir.1995) (quoting Celotex Corp., supra, 477 U.S. at 324, 106 S.Ct. at 2553, 91 L.Ed.2d at 274, (1986)); Clinkscales v. Chevron USA, Inc., 831 F.2d 1565, 1570 (11th Cir.1987).

B. Discussion

(1) The Little Tucker Act Claim for Breach of Contract

The plaintiffs claim that an implied contract exists between the plaintiffs and the government that obligates the government to provide the plaintiffs and their families with free medical care in military facilities for the plaintiffs' lifetime. According to the plaintiffs, the alleged offer was part oral and part written, was accepted by the plaintiffs, and was performed by the United States for several generations — until the implementation of "Tricare." The defendants contend that military retirees' eligibility for health care is governed exclusively by statute, and that the plaintiffs, who retired after 1956, are eligible for health care only as provided by Title 10, United States Code, Section 1074(b). The defendants further contend that even if the plaintiffs' eligibility was determined by the regulations in place at the time they joined the armed services or made career military service decisions, the regulations at that time would not have entitled the plaintiffs or their dependents to free and unconditional medical care at military facilities. Finally, the defendants contend that they could not have entered into implied-in-fact contracts with the plaintiffs, since: (1) the plaintiffs executed express contracts governing their pay and benefits when they enlisted; and (2) government agents would not have had actual authority to promise benefits that were inconsistent with the regulatory scheme in place at the time the promises were allegedly made to the plaintiffs.

The plaintiffs' contract claim is brought under the Little Tucker Act, which provides concurrent jurisdiction in the United States district courts and the Claims Court for claims against the United States founded "upon any express or implied contract with the United States" that do not exceed $10,000 in amount. 28 U.S.C. § 1346(a)(2). An implied-in-fact contract with the government requires mutuality of intent to contract, consideration, and an unambiguous offer and acceptance. Alliance of Descendants of Texas Land Grants v. United States, 37 F.3d 1478 (Fed.Cir.1994); Helash v. Ballard, 638 F.2d 74, 75 (9th Cir.1980). The plaintiff must also show that the officer whose conduct is relied upon had actual authority to bind the government in contract. H.F. Allen Orchards v. United...

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3 cases
  • Schism v. U.S.
    • United States
    • U.S. Court of Appeals — Federal Circuit
    • 18 Noviembre 2002
    ...the Northern District of Florida holding that because the promises were not authorized they are not enforceable. Schism v. United States, 19 F.Supp.2d 1287, 1295 (N.D.Fla.1998). The district court concluded that because no statute authorized these promises, no valid contract was formed betw......
  • Schism v. U. S.
    • United States
    • U.S. Court of Appeals — Federal Circuit
    • 8 Febrero 2001
    ...Part B, and who began their service or made service career decisions before 1956, which they do not appeal. See Schism v. United States, 19 F. Supp. 2d 1287 (N.D. Fla. 1998). Because the district court erroneously concluded as a matter of law that the retirees did not prove an implied-in-fa......
  • Sebastian v. US.
    • United States
    • U.S. Court of Appeals — Federal Circuit
    • 9 Agosto 1999
    ...facilities are available' basis," id. at 3. Before 1951, the Air Force followed the Army's regulations, see Schism v. United States, 19 F. Supp. 2d 1287, 1293 (N.D. Fla. 1998), but that year, it promulgated Air Force Regulation 160-73 14h (1951), which stated that "[t]he hospitalization of ......

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