Craft v. United States

• Decision Date: 13 December 1978
• Docket Number: No. 96-74.,96-74.
• Parties: Charles E. CRAFT v. The UNITED STATES.
• Court: U.S. Claims Court

589 F.2d 1057

Charles E. CRAFT v. The UNITED STATES.

No. 96-74.

United States Court of Claims.

December 13, 1978.

Charles E. Craft, pro se.

Russell W. Koskinen, Washington, D.C., with whom was Asst. Atty. Gen. Barbara Allen Babcock, Washington, D.C., for defendant. James F. Merow, Washington, D.C., of counsel.

Before FRIEDMAN, Chief Judge, and KUNZIG and BENNETT, Judges.

OPINION

PER CURIAM:

This case has been reviewed by the court on defendant's exceptions to the decision of Trial Judge Kenneth R. Harkins, filed January 26, 1978. Upon consideration of those exceptions, supporting brief, and oral argument, the court fully agrees with the trial judge and adopts his opinion, which follows, as the basis for its judgment in this case. Because plaintiff's civilian earnings during the period of his illegal separation from employment were in excess of the balance due on his claim for backpay, he is not entitled to recover, and it is so ordered. However, because defendant has laid such emphasis upon a challenge to our jurisdiction in this case, we will, by additional comment here, underscore our approbation of the trial judge's rejection of defendant's contentions.

Defendant's basic assertion is that in order for the court to extend the collateral relief of restoration to duty and correction of records, pursuant to 28 U.S.C. § 1491, it must enter a money judgment to which such relief can attach. Defendant would refine this proposition to hold that, where liability has been found and a case has been remanded to the trial division to fix the damages pursuant to Rule 131(c)(2) and the trial judge finds no monetary loss because plaintiff's outside earnings when offset are more than backpay otherwise due, we then have no jurisdiction and must set aside the earlier judgment holding defendant liable and providing collateral relief to plaintiff. Defendant says that otherwise the judgment on liability was a declaratory judgment which we have no jurisdiction to grant. United States v. King, 395 U.S. 1, 89 S.Ct. 1501, 23 L.Ed.2d 52 (1969). This contention was recently raised in a tax case where, in a suit for refund, defendant tendered the refund and argued there was thus no money claim before the court and that under United States v. Testan, 424 U.S. 392, 96 S.Ct. 948, 47 L.Ed.2d 114 (1976), the court lacked jurisdiction. In rejecting this defense the court pointed out that there was jurisdiction when the petition was filed, that the refund was made later, and that plaintiff, who had incurred discovery expenses pertinent to the claim and to claims not yet brought, should not be thus deprived of the collateral estoppel benefit by defendant's payment on one claim. The court said, in Hotel Conquistador, Inc. v. United States, Ct.Cl. No. 374-75 (order, Oct. 2, 1978):

* * * Payment is normally not jurisdictional but a matter of defense. Testan does not hold that a court having jurisdiction of a suit as filed suddenly loses it at a time chosen by defendant, whenever defendant tenders payment.

See also Church of Scientology of Hawaii v. United States, 485 F.2d 313 (9th Cir. 1973).

The case before us is very much the same. Payment, a bookkeeping matter here, did not occur by defendant until it made the offset against plaintiff's backpay, which had earlier been determined to be due by the court. Craft v. United States, 544 F.2d 468, 210 Ct.Cl. 170 (1976). Defendant's action did not moot the viable, justiciable controversy presented by the pleadings. Carried one step further, defendant's theory would next deprive plaintiff of retired pay, which he is now receiving as a result of collateral relief to the holding of backpay liability. Defendant's counsel admitted at oral argument that he believed suit would be possible to recover it. The required correction of plaintiff's records would topple with the rest of this legal fiction. We cannot subscribe to such a bizarre procedure and result in the administration of justice. The purpose of our rules, stated in Rule 1, is "to promote the just, speedy, and inexpensive determination of every action."

Where a petition asserts a claim arising under an act of Congress or the regulation of an executive department, the Court of Claims has jurisdiction to decide whether the complaint states a cause of action. Failure to state a proper cause of action calls for a judgment on the merits and not for a dismissal for want of jurisdiction. Ralston Steel Corp. v. United States, 340 F.2d 663, 169 Ct.Cl. 119, cert. denied, 381 U.S. 950, 85 S.Ct. 1803, 14 L.Ed.2d 723 (1965).

In the present case this court rendered a judgment on the liability issue. Craft v. United States, supra. Although this was not a final judgment with respect to the amount of the monetary claim, it was a final judgment as to entitlement to back-pay and collateral relief. Under the rules it is provided:

* * * the court, upon entering judgment that a party is entitled to recover, may reserve determination of the amount of the recovery for further proceedings. In such event, the judgment on the question of the right to recover shall be final * * *. Rule 131(c)(2).

The Supreme Court has never hesitated to review our "liability" judgments without any question as to the propriety of doing so.

The necessity of granting collateral relief, even though a monetary award may not be due, is mandated by the nature of the backpay claim. A cause of action for backpay based upon an illegal discharge accrues on the date of the discharge for statute of limitations purposes. See, e. g., Kirby v. United States, 201 Ct.Cl. 527 (1973), cert. denied, 417 U.S. 919, 94 S.Ct. 2626, 41 L.Ed.2d 224 (1974); O'Callahan v. United States, 451 F.2d 1390, 196 Ct.Cl. 556 (1971). The obligation of the United States to pay a certain sum is not fixed as of that date; indeed, at that date no sum may yet be due. The claim is instead for a period beginning with the date of the wrongful termination up until the time of final judgment in this court (if the employee does not request any collateral relief) or up until the time of corrective action by the agency involved. It is true that an employee cannot unreasonably delay the commencement of his action in this court in the hopes of greatly increasing his recovery, for the employee may well be barred from asserting a meritorious claim by the defense of statute of limitations or laches. We cannot, however, determine at the time an employee files his petition in this court that he is or is not entitled to a net monetary award for his backpay claim, even if he were to prevail on the liability issue, because his entitlement is conditioned on the mitigation of his entitlement to his Government salary by offset of civilian earnings. The amount of civilian earnings is a factor which is not capable of determination or control by the court; thus, a party who has a "net loss" (recomputed earnings minus civilian earnings) at the time of filing his petition may actually receive no monetary award, and, conversely, a party who has no loss at the time his petition is filed may very well receive a monetary award. Our jurisdiction does not depend on this factor, nor does it make sense that our power to grant collateral relief, and thus actually fix the period for a pay award, depends on the happenstance of future events. Accordingly, contrary to defendant's contention, the plaintiff is not required to allege in his petition that the amount of backpay to which he is entitled exceeds any civilian earnings he had since his unlawful discharge.

Defendant says, however, that in such circumstances as here, we should either dismiss the petition or transfer the case to a district court. This has never been the practice. In most of our merits cases, whether tax, pay, contract, or other category, we first determine the liability of the United States, subject to remand to the trial division for precise calculation of the amount due pursuant to Rule 131(c). This has been the published rule since 1951. This time-honored practice, whose worth has never been questioned until Hotel Conquistador, Inc. v. United States, supra, results in judicial economy and often saves time and money for the parties. For instance, if a plaintiff loses on proof of liability on a breach of contract claim, the parties will be saved from presentation of elaborate proof that would be useless on damages. Of course, there is the occasional possibility that a plaintiff who prevails at the liability phase may later be found to be owed no money at all, as here. Defendant's present theory would require us to dismiss all of these cases at that point for lack of jurisdiction, which this court has never done, and, as a practical matter, it would require that we abandon the bifurcation of liability and damages for trial, a step backwards in judicial procedures. Cf. Fed.R.Civ.P. 42.

If defendant thinks there is any real merit to its contention, it should seek, as a guardian of justice and efficiency in treatment of claims, the assistance of Congress to amend the declaratory judgment statute, 28 U.S.C. § 2201, to include the Court of Claims, as the Supreme Court, in United States v. King, supra, suggested would be appropriate. Until that day we will continue to proceed on the basis of our precedents and rules and on what we think is right and just and clearly within our authority to adjudicate and avoid absurd or whimsical results. We sustain the trial judge and reject defendant's jurisdictional challenge. Plaintiff's petition is dismissed.

OPINION OF TRIAL JUDGE

HARKINS, Trial Judge:

This case previously was before the court on cross-motions for summary judgment on liability issues and the facts were detailed in the June 16, 1976, opinion. On those facts, treatment plaintiff had received from the Army was characterized as "reprehensible."¹ The Army was ordered to reinstate plaintiff (with his consent) in the rank of sergeant, first class (E-7),² for a period at least equal to 3...