Jankowitz v. United States

• Citation: 533 F.2d 538
• Decision Date: 14 April 1976
• Docket Number: No. 83-75.,83-75.
• Parties: Joseph H. JANKOWITZ v. The UNITED STATES.
• Court: U.S. Claims Court

533 F.2d 538

Joseph H. JANKOWITZ v. The UNITED STATES.

No. 83-75.

United States Court of Claims.

April 14, 1976.

COPYRIGHT MATERIAL OMITTED

Herbert A. Levy, attorney of record, for plaintiff; Allen Lashley, New York City, of counsel.

Leslie H. Wiesenfelder, Washington, D.C., with whom was Asst. Atty. Gen., Rex E. Lee, Washington, D.C., for defendant; Alexander Younger, Washington, D.C., of counsel.

Before SKELTON, NICHOLS and BENNETT, Judges.

ON PLAINTIFF'S MOTION TO DISMISS DEFENDANT'S COUNTERCLAIMS AND ON PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT AND DEFENDANT'S CROSS-MOTION FOR SUMMARY JUDGMENT

BENNETT, Judge:

In this civilian pay case plaintiff sues under the Back Pay Act of 1966, 80 Stat. 94, 95, 5 U.S.C. § 5596 (1970), and 28 U.S.C. § 1491 (1970), seeking pay and allowances which he would have earned had he not been made the object of an adverse personnel action.¹ Defendant has lodged in its responsive pleading an affirmative defense of setoff of damages for "deceit," as the alternative to its first counterclaim, under the False Claims Act, 31 U.S.C. § 231 et seq. (1970), as well as a second counterclaim for return of alleged bribes, gratuities, kickbacks, and similar illegal payments to plaintiff. Defendant invokes our jurisdiction of its counterclaims pursuant to 28 U.S.C. § 1503 (1970).

At all relevant times prior to March 28, 1972, plaintiff was employed as an appraiser, GS-11, step 7, $15,973 per annum, in the Federal Housing Administration (FHA), Department of Housing and Urban Development (HUD), at a location in the State of New York. On that date he was indicted by a grand jury in the United States District Court for the Eastern District of New York. The indictment charged plaintiff with having received two separate illegal payments of $100 each in return for being influenced in his official acts as an appraiser in connection with the premises known as 260 51st Street, Brooklyn, New York.

On March 31, 1972, plaintiff's employer transmitted to him an advance notice of proposed indefinite suspension without pay during the pendency of the criminal action. The reason cited for this action was: "You were indicted by the Federal Grand Jury for the United States District Court, Eastern District of New York, on or about March 28, 1972 * * * for accepting bribes." Plaintiff made a written reply on April 3, 1972, but it was ineffective and indefinite suspension without pay was imposed on April 6, 1972. After a hearing was conducted on June 1, 1972, the New York Regional Office of the Civil Service Commission, by order dated July 5, 1972, approved both the substantive and procedural aspects of plaintiff's suspension. That office recognized in its decision that the suspension was based upon the fact of plaintiff's indictment, and not upon any separate administrative charge to the effect that plaintiff was actually guilty of the bribery as alleged by the grand jury. The Civil Service Commission's Board of Appeals and Review affirmed on November 13, 1972.

Just over 1 month prior to final Civil Service Commission action on his administrative appeal, on October 1, 1972, plaintiff went on trial in the Eastern District of New York. The trial involved 23 defendants charged on 211 separate counts, and lasted from October 1, 1973, to June 18, 1974, ending in plaintiff's acquittal of all charges by a jury verdict and judgment entered June 18, 1974. Plaintiff conceded at argument that during the entirety of the trial he was unavailable for the performance of his job.

On June 19, 1974, plaintiff reported to his employer for duty and requested reinstatement. By notification of personnel action dated December 13, 1974, plaintiff was officially returned to duty, effective retroactively to June 19, 1974, at a salary commensurate to GS-11, step 7. Plaintiff has never been paid for the period between June 19, 1974, when he presented himself for duty, and the date he actually returned to work, November 5, 1974. Defendant concedes plaintiff's entitlement to judgment for this period only. For the period of indefinite suspension without pay between April 6, 1972, and June 19, 1974, plaintiff was not paid and claims it here. Effective February 20, 1975, plaintiff retired from the service for disability and he brought this suit on March 24, 1975.

Relative to defendant's affirmative defense and counterclaims certain additional facts must be taken into account. The alleged illegal payments to plaintiff are said to have been made on or about October 31, 1968, and January 30, 1969. Defendant avers that in return for such illegal payments plaintiff intentionally inflated his appraisal of the land and improvements at 260 51st Street, Brooklyn, New York, from $16,150 to $23,850. Plaintiff admits only increasing the appraisal. Defendant says further that FHA insured against default upon indebtedness secured by this property in an excessive amount reflecting plaintiff's inflated appraisal. Such default did occur, so far as the application for insurance benefits indicates, not earlier than January 1970. Thereafter, insurance benefits out of proportion to the reasonable value of the collateral were paid and the Secretary of HUD acquired title to the property as well as an assignment of the paper embodying the defaulting party's obligations to the mortgagee/assignor. The application for such insurance benefits, dated February 15, 1973, was presented to FHA on February 22. Defendant's counterclaims were filed on May 23, 1975. Therefore, between the date of the alleged illegal payments and the filing of these counterclaims there expired a period in excess of 6 years. Between the date of the obligor's default and the filing of the counterclaim, 5 years and nearly 5 months elapsed. Between the filing of the claim for FHA insurance benefits and the filing of the instant counterclaims, only 2 years and 3 months went by. Finally, defendant has provided an affidavit tending to prove that not until March 1970 were facts reasonably known to FBI investigators leading to discovery of plaintiff's alleged bribery.

Plaintiff now moves for summary judgment on his back pay claim and to dismiss the affirmative defense and counterclaims, on the ground that they are barred by applicable statutes of limitations. All other of plaintiff's arguments touching defendant's counterclaims have been abandoned. Defendant cross-moves for summary judgment as to plaintiff's back pay claim, and opposes plaintiff's bid for dismissal of both counterclaims. For the reasons stated below, we think that plaintiff's motion should be allowed insofar as it seeks summary judgment for back pay, but only for the period between June 19, 1974, and his actual return to work, as defendant has conceded. We have concluded, further, that the defendant's affirmative defense and counterclaims are not barred by applicable statutes of limitations. Accordingly, to this extent plaintiff's motion should be denied.

I

Plaintiff as moving party encounters the burden of demonstrating his entitlement to summary judgment for back pay as a matter of law. Rule 101(d); e.g., Housing Corp. of America v. United States, 468 F.2d 922, 924, 199 Ct.Cl. 705, 710 (1972). As we have seen, the Back Pay Act of 1966 authorizes us to make such an award only where it appears that the plaintiff has undergone "an unjustified or unwarranted personnel action."² In accordance with statutory authority conferred by 5 U.S.C. § 5596(c) (1970), the Civil Service Commission heretofore has adopted regulations interpreting this statutory language:

(d) To be unjustified or unwarranted, a personnel action must be determined to be improper or erroneous on the basis of either substantive or procedural defects after consideration of the equitable, legal, and procedural elements involved in the personnel action. 5 C.F.R. § 550.803(d) (1975).

Within this framework the moving party here must particularize for us the way in which his indefinite suspension from duty without pay was unjustified or unwarranted.

Plaintiff relies principally upon the position that his suspension from duty without pay was unjustified and unwarranted because procedurally defective. He calls our attention to the undisputed fact, previously mentioned, that his advance notice of proposed indefinite suspension cited his indictment as its basis; not the acts underlying the indictment—alleged bribery. Since the personnel action was bottomed upon the indictment itself, and not upon the alleged criminal acts, plaintiff presses upon us the view that his acquittal in effect retroactively destroyed the legal efficacy of his indictment as a basis for adverse personnel action. At first blush this notion seems extravagant indeed; we have held on many occasions that in the normal case acquittal of a criminal charge does not lead inexorably to the conclusion that an adverse personnel action was unjustified or unwarranted, where based upon the same alleged conduct. E.g., Holman v. United States, 383 F.2d 411, 181 Ct.Cl. 1 (1967); Prater v. United States, 172 Ct.Cl. 608 (1965); Finn v. United States, 152 Ct.Cl. 1 (1961); Bryant v. United States, 122 Ct.Cl. 460 (1952), cert. denied, 344 U.S. 913, 73 S.Ct. 335, 97 L.Ed. 704 (1953); Croghan v. United States, 89 F.Supp. 1002, 116 Ct.Cl. 577, cert. denied, 340 U.S. 854, 71 S.Ct. 71, 95 L.Ed. 626 (1950). We have approved the principle just stated because of the different standards of proof prevailing in criminal prosecutions and adverse personnel actions.

Plaintiff believes the instant case to be different, however, in that the indictment itself was offered as the reason for proposed indefinite suspension. He has referred us to certain provisions in the Federal Personnel Manual (FPM) to support his contention that acquittal vitiated the cause for action against him.

S3-2 INSUFFICIENT CAUSE

a. Pitfalls to avoid. Agencies should be alert to avoid such errors as the following:

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(2) Cause based on criminal

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