Kasarsky v. Merit Systems Protection Bd.

• Decision Date: 17 July 2002
• Docket Number: No. 02-3006.,02-3006.
• Citation: 296 F.3d 1331
• Parties: Stephen J. KASARSKY, Petitioner, v. MERIT SYSTEMS PROTECTION BOARD, Respondent.
• Court: U.S. Court of Appeals — Federal Circuit

Page 1331

296 F.3d 1331

Stephen J. KASARSKY, Petitioner, v. MERIT SYSTEMS PROTECTION BOARD, Respondent.

No. 02-3006.

United States Court of Appeals, Federal Circuit.

July 17, 2002.

C.B. Weiser, from Marshall, TX, for petitioner.

Calvin M. Morrow, Attorney, Office of the General Counsel, Merit Systems Protection Board, of Washington, DC, for respondent. With him on the brief were Lynn A. Jennings, General Counsel; and Martha B. Schneider, Deputy General Counsel.

Before LINN, Circuit Judge, PLAGER, Senior Circuit Judge, and PROST, Circuit Judge.

LINN, Circuit Judge.

Stephen J. Kasarsky seeks review of the final decision of the Merit Systems Protection Board ("Board") that dismissed as untimely Kasarsky's petition for enforcement of a settlement agreement covering attorney fees. Kasarsky v. United States Postal Serv., MSPB Docket No. AT-0752-97-0483-C-1 (Initial Decision, June 29, 2001). Because the Board's decision is not in accordance with law, we reverse and remand.

BACKGROUND

The present dispute centers around attorney fees that the United States Postal Service ("the agency") agreed to pay as part of a settlement agreement with Kasarsky. Kasarsky was employed by the agency as a latent print analyst in Memphis, Tennessee. In March 1997, the agency placed Kasarsky on enforced leave. Kasarsky appealed the agency's decision to the Board, and the parties settled the dispute, making the settlement part of the record before the Board. Because the settlement resolved all matters before the Board, the Board's jurisdiction over the merits of the case was concluded. However, the Board retained jurisdiction for the purpose of considering any enforcement or compliance issues that may arise under the settlement agreement. Kasarsky v. United States Postal Serv., MSPB Docket No. AT-0752-97-0483-I-1 (June 26, 1997). Counsel for the agency reduced the settlement agreement to writing and forwarded it to Kasarsky's counsel for his approval. Kasarsky's counsel objected to the addition of a paragraph that was not previously entered into the record before the Board and indicated that if the agreement were amended, Kasarsky would sign the revised agreement. On July 14, 1997, the agency's counsel sent Kasarsky's counsel a revised agreement removing the added paragraph to which Kasarsky objected.

After settling the merits of the employment action, Kasarsky filed a petition on September 3, 1997, for an award of attorney fees incurred in his appeal. The parties reached an oral agreement, and on October 27, 1997, made a separate attorney fees settlement part of the record at a hearing before the Board. Based on that record, Kasarsky's attorney agreed to dismiss the petition in return for the agency's agreement to pay an agreed fixed portion of the original claim. While there was a brief colloquy regarding when the payment might be expected, no definitive time for payment was demanded by Kasarsky's attorney or promised by the agency. As with the underlying settlement on the merits, the Board retained jurisdiction of the fee application for the limited purpose of considering any enforcement or compliance issues that may arise under the fee settlement agreement. Kasarsky v. United States Postal Serv., MSPB Docket No. AT-0752-97-0483-A-1 (Oct. 27, 1997). The parties did not furnish a copy of a written fee agreement, and we find nothing in the record to indicate that the terms of the agreement agreed to orally at the hearing — and preserved on tape by the Board — were ever reduced to writing or subsequently altered in any way.

Four and one-half months later, on January 21, 1998, Kasarsky's attorney notified the agency that Kasarsky's attorney fees had not been paid. Counsel for the agency responded, noting that the "Postal Service remains willing to pay your attorney fees" but the "attorney fees have not been paid to date because we have not received the written [underlying merits settlement] agreement." Kasarsky did not immediately return the signed agreement. Nearly two years later, on December 19, 1999, Kasarsky executed the settlement agreement on the merits of the claim, and the agency received it on January 6, 2000. During the same time period, Kasarsky's attorney wrote the agency regarding an unrelated application for disability retirement benefits. Kasarsky's counsel asked that the agency process the previous settlement agreement.¹ In a January 26, 2000 letter, the agency acknowledged that it had received the executed agreement and would credit Kasarsky certain leave hours pursuant to the agreement. The agency letter makes no reference to attorney fees.

Exactly one year later on January 26, 2001, Kasarsky's counsel wrote the agency and reminded it of the agreement to pay attorney fees. The letter concluded asking the agency to "[p]lease advise upon receipt of this letter when payment of the attorney fees will be made." The agency did not respond to the letter. Less than one month later, on February 23, 2001, Kasarsky's counsel made a demand upon the agency for the attorney fees, threatening to file a petition for enforcement with the Board for breach of the settlement agreement if the payment was not made by March 5, 2001. The agency again did not respond to the request. On April 3, 2001 Kasarsky filed a petition for enforcement of the settlement agreement seeking the agreed upon amount of fees plus interest. The agency responded, noting, among other things, that Kasarsky took nearly two years to return the executed settlement agreement. The agency asserted that the petition was untimely based on Kasarsky's unreasonable delay in returning the signed settlement agreement. The agency concluded by acknowledging for the first time that it would not pay the attorney fees.

The Board refused to enforce the agreement and dismissed the petition. On appeal, Kasarsky argues that the Board's decision was not supported by substantial evidence. Specifically, he argues that the agency agreed to pay the attorney fees and never indicated otherwise until after Kasarsky filed a petition for enforcement of the settlement agreement. The agency argues that the Board acted within its discretion when finding that the delay in filing the petition was unreasonable.

We have jurisdiction pursuant to 5 U.S.C. § 7703(b)(1).

DISCUSSION

A. Standard of Review

The standard of review in an appeal from a decision of the Board is strictly limited by statute. We may reverse a decision of the Board only if it is:

(1) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law;

(2) obtained without procedures required by law, rule, or regulation having been followed; or

(3) unsupported by substantial evidence.

5 U.S.C. § 7703(c) (2000); Stearn v. Dep't of the Navy, 280 F.3d 1376, 1380 (Fed.Cir. 2002).

B. Analysis

This court has not addressed the time limit within which a petition for enforcement of a settlement agreement must be filed. Thus, we are faced with a question of first impression. In reaching its decision, the Board looked for guidance to an analogous regulation pertaining to enforcement of a final decision or order issued under the Board's appellate jurisdiction. See 5 C.F.R. § 1201.182(a) (2001). Under that regulation, a petition alleging a breach of a final decision "must be filed promptly" and "must describe specifically the reasons the petitioning party believes there is noncompliance." Id. The regulation further provides that "[a]ny petition for enforcement that is filed more than 30 days after the date of service of the agency's notice that it has complied must contain a statement and evidence showing good cause for the delay and a request for an extension of time for filing the petition." Id. Because an agency that enters into a settlement agreement is not required to serve a notice of compliance, these provisions are not directly applicable to petitions for enforcement of settlement agreements. See, e.g., Bostick v. Dep't of Health and Human Serv., 63 M.S.P.R. 399, 401 (1994).

While the above regulation does not directly apply to settlement agreements, the underlying rationale for the regulation is nevertheless instructive in the enforcement of settlement agreements. A party's obligation to abide by the terms of a settlement agreement is no less than its obligation to follow the Board's own orders. In the context of complying with an order from the Board, 5 C.F.R. § 1201.181(a) mandates that the parties "cooperate fully with each other so that compliance with the Board's orders and decisions can be accomplished promptly and in accordance with the laws, rules, and regulations that apply to individual cases." When an agency has complied with an order from the Board, the regulations require the agency to "inform the appellant promptly of the actions it takes to comply, and it must tell the appellant when it believes it has completed its compliance." 5 C.F.R. § 1201.181(b) (2001). The regulations also place a burden upon the appellant to "provide all necessary information that the agency requests in order to comply, and, if not otherwise notified, he or she should, from time to time, ask the agency about its progress." Id. The purpose of those provisions is to avoid unnecessary petitions for enforcement. Id.

The timeliness of a petition for enforcement of a final Board decision is measured against the date that the agency notifies the appellant of its compliance. Because the agency is not required to serve a notice of compliance in a settlement context, the timeliness of a petition for enforcement of a settlement agreement must be measured against a different standard. The Board, in Adamcik v. United States Postal Service, 48 M.S.P.R. 493 (1991), recognized this and adopted a rule governing this issue. In that case, the Board held that an enforcement petition alleging a breach of a settlement agreement which the Board retained the authority to enforce must be filed "within a reasonable amount of time of...