Bright v. Nimmo

• Decision Date: 08 April 1985
• Docket Number: No. 83-8684,83-8684
• Citation: 756 F.2d 1513
• Parties: Rufus W. BRIGHT, Jr., Plaintiff-Appellant, v. Robert P. NIMMO, Administrator of Veterans Administration, American Cyanamid Company, Insurance Company of North America, and the Georgia Company, Defendants-Appellees. Non-Argument Calendar.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1513

756 F.2d 1513

Rufus W. BRIGHT, Jr., Plaintiff-Appellant, v. Robert P. NIMMO, Administrator of Veterans Administration American Cyanamid Company, Insurance Company of North America, and the Georgia Company Defendants-Appellees.

No. 83-8684

Non-Argument Calendar.

United States Court of Appeals, Eleventh Circuit.

April 8, 1985.

Clarence L. Martin, Savannah, Ga., for plaintiff-appellant.

Melissa S. Mundell, Savannah, Ga., for defendant-appellee R. Nimmo.

Walter Hartridge, R. Jonathan Hart, Laura M. Christian, Savannah, Ga., for defendants-appellees American Cyanamid & Ins. Co. of N. America.

Paul W. Painter, Jr., Savannah, Ga., for defendant-appellee The Ga. Co.

Appeal from the United States District Court for the Southern District of Georgia.

Before FAY, VANCE and KRAVITCH, Circuit Judges.

KRAVITCH, Circuit Judge:

In this diversity case, plaintiff Rufus W. Bright, Jr. appeals from the grant of a motion for summary judgment in favor of defendants. Plaintiff contends that the district court erroneously held that (1) plaintiff had no cause of action against his employer and its insurer, independent of the remedies provided by the Workers' Compensation Act, O.C.G.A. Secs. 34-9-1 to -367, for their willful failure to pay him income benefits to which he was entitled, and (2) plaintiff had no cause of action against the Veterans Administration and a private lender for their failure to help him avoid foreclosure on his home. We affirm.

I. BACKGROUND

In July, 1981, plaintiff, an employee of American Cyanamid Company ("ACC"), suffered an employee-related injury and filed for Workers' Compensation benefits. Neither ACC nor its insurer, Insurance Company of North America ("ICNA"), began making payments to plaintiff as required by the Workers' Compensation Act ("the Act"), O.C.G.A. Secs. 34-9-1 to -367. Instead, ICNA chose to controvert plaintiff's claim with the Workers' Compensation Board ("the Board"). The notice of controversion was not timely filed.

Meanwhile, plaintiff's financial condition deteriorated. In August and September, 1981, plaintiff failed to make the required monthly payments on a loan he had received from Georgia Company ("GC") for the purchase of his home. The loan was secured by a mortgage on the home and had been guaranteed, in part, by the Veterans Administration (Robert P. Nimmo, Administrator, hereinafter "VA"). On September 2, 1981, GC notified plaintiff that his loan payments were delinquent. Plaintiff responded that he would bring his mortgage current as soon as he had enough money, but that he did not know when that might be.

On October 7, GC notified plaintiff that foreclosure proceedings were being instituted, that GC would not accept any more monthly payments, and that plaintiff should contact GC's foreclosure committee in order to show cause why the foreclosure should not proceed. Plaintiff did not respond. In late October, plaintiff sent GC a single mortgage payment of $214.24, although the mortgage was then three months in arrears. GC returned the payment and notified plaintiff of the total amount due. A representative from GC visited plaintiff, who stated that he expected On October 22, GC mailed plaintiff a notice of default. On October 28, VA sent plaintiff a letter informing him that the loan was in default and that he should immediately contact his lender. Plaintiff did not answer the letter. GC sent plaintiff a form questionnaire, to which plaintiff responded that he would bring his payments current within three weeks after the hearing on his Workers' Compensation claim, scheduled for November 9.

to be able to bring his payments current by October 30.

On November 7, plaintiff received a notice of intent to foreclose. On November 10, VA sent plaintiff another letter, this time warning plaintiff about the impending foreclosure and again encouraging plaintiff to contact his lender or VA. According to plaintiff, he called VA, but a VA official failed to return the call.

On December 2, an attorney for GC sent plaintiff a registered letter informing him that the entire amount of the loan was accelerated and immediately due. The letter suggested that GC might not foreclose if plaintiff paid the past due payments plus costs. Plaintiff received the letter by December 12.

On December 16, the Board found that both ACC and ICNA were required but had failed to pay income benefits to plaintiff. In addition to an award of benefits, the Board awarded plaintiff a fifteen percent statutory penalty and attorney fees pursuant to O.C.G.A. Sec. 34-9-221(e), finding that ACC and ICNA had "without reasonable grounds" failed to comply with the requirements of the Act.

Subsequently, on or about December 29, plaintiff responded to GC's letter by mailing to GC a cashier's check and money order totalling $1,268.96. This was substantially less than the accelerated amount then due. GC returned the two checks to plaintiff on January 4, 1982. Plaintiff's home was sold at a foreclosure sale on January 5.

II. DISCUSSION

A. Whether Plaintiff Has a Cause of Action Against ACC and ICNA

Plaintiff sued ACC and ICNA, alleging that their "willful and intentional" failure pay him income benefits to which he was entitled caused him to lose his home and suffer marital and other difficulties. The district court ruled that plaintiff had no cause of action against ACC and ICNA, and granted summary judgment in favor of both defendants.

On appeal, we determined that this issue presented an important unresolved question of Georgia law: Whether Georgia recognizes an independent cause of action apart from the remedies available under O.C.G.A. Sec. 34-9-221(e) where an employer and/or insurer have intentionally delayed Workers' Compensation payments to which the employee is entitled under the Act and where they have not properly complied with the Act's requirements. We certified this question to the Georgia Supreme Court, which answered the question in the negative. See Bright v. Nimmo, 253 Ga. 378, 320 S.E.2d 365, 368 (1984) (reproduced as Appendix A, infra ). We therefore hold that ACC and ICNA are entitled to judgment as a matter of law, and we affirm the district court's grant of summary judgment in favor of both defendants.

B. Whether Plaintiff Has a Cause of Action Against VA and GC

Plaintiff also sued VA and GC, seeking legal and equitable relief for "wrongful foreclosure" on the grounds that VA, in concert with GC, "deprived" plaintiff of his property by failing to carry out its duty to help plaintiff avoid foreclosure on his home. The district court ruled that plaintiff had no cause of action against VA and GC, and that plaintiff was not entitled to equitable relief from the foreclosure under Georgia law.

On appeal, plaintiff contends that the VA's own manuals and guidelines create an obligation on the part of the VA to "help veterans retain their homes during temporary In the view compelled upon us by Cort v. Ash [422 U.S. 66, 95 S.Ct. 2080, 45 L.Ed.2d 26 (1975) ] and its progeny, we must conclude ... that appellant lacks any express or implied right of action in federal court to enforce duties V.A. and lenders may have pursuant to V.A. publications.... The now familiar Cort v. Ash factors relevant to implying a private cause of action are: whether appellant belongs to "the class for whose especial benefit the statute was enacted;" whether there is any "indication of legislative intent ... to create such a remedy;" whether implying a remedy is "consistent with the underlying purpose of the legislative scheme;" and whether the cause of action is "one traditionally relegated to state law." Cort v. Ash, supra, 422 U.S. at 78, 95 S.Ct. at 2087. Appellant in this case cannot demonstrate that any specific statute creates a federal right in his favor. He lacks a statutory basis for his action. The V.A. publications on which he relies are not sufficient as the basis for his suit. Nor has appellant cited any statutory language or legislative history which even arguably indicates a "legislative intent" to establish a private right of action in a case such as this. Finally, and most importantly, appellant, represented by able counsel, had, and may possibly still have, "access to state remedies" to set aside the foreclosure which he suffered, remedies which are "traditionally relegated to state law." Id.

                financial difficulties."    VA Loan Guaranty Bulletin No. 566 at p. 3 (1980).  Plaintiff argues that these manuals and guidelines give rise to an implied cause of action against VA and private lenders whenever VA fails properly to help a veteran avoid foreclosure.  Both the Ninth Circuit, in Rank v. Nimmo, 677 F.2d 692 (9th Cir.), cert. denied, 459 U.S. 907, 103 S.Ct. 210, 74 L.Ed.2d 168 (1982), and the D.C. Circuit, in Simpson v. Cleland, 640 F.2d 1354 (D.C.Cir.1981), have squarely rejected claims identical to plaintiff's.  The D.C. Circuit explained
                

Simpson v. Cleland, 640 F.2d at 1359-60 (citations and footnotes omitted). The Ninth Circuit agreed, holding that "neither the statutory language nor the legislative history of the VA Act provides any 'indication of legislative intent ... to create such a remedy' against the private lender." Rank v. Nimmo, 677 F.2d at 697 (quoting Cort v. Ash, 422 U.S. at 78, 95 S.Ct. at 2087).

We find the reasoning of Simpson and Rank persuasive on this issue, particularly in view of the fact that no federal appellate court to date has reached a contrary conclusion. ¹ Furthermore, although this circuit has not previously addressed the particular issue raised in this case, the former Fifth Circuit, in United States v. Harvey, 659 F.2d 62 (5th Cir. Unit B 1981), ² rejected the same theoretical foundation on which plaintiff's claim is based. The facts in Harvey were similar to those in the instant case, except that the loan had been provided directly by VA rather than by a private lender. When VA foreclosed on the loan, the veteran sued VA, arguing that a VA...