Radio-Television Training Ass'n v. United States, 474-56.

• Decision Date: 16 July 1958
• Docket Number: No. 474-56.,474-56.
• Citation: 163 F. Supp. 637,143 Ct. Cl. 416
• Parties: RADIO-TELEVISION TRAINING ASSOCIATION, Inc. v. UNITED STATES.
• Court: U.S. Claims Court

163 F. Supp. 637

143 Ct. Cl. 416

RADIO-TELEVISION TRAINING ASSOCIATION, Inc. v. UNITED STATES.

No. 474-56.

United States Court of Claims.

July 16, 1958.

I. H. Wachtel, New York City, for the plaintiff.

David Orlikoff, Washington, D. C., with whom was Asst. Atty. Gen. George Cochran Doub, for the defendant. Miriam G. Cedarbaum, New York City, was on the brief.

JONES, Chief Judge.

The petitioner brings this action for recovery of allowances allegedly due from the Administrator of Veterans' Affairs under the provision of § 265(b) of the Veterans' Readjustment Assistance Act of 1952, 38 U.S.C.A. § 975(b).

Whether the plaintiff is so entitled to recover is a question of law. Consequently, both parties have filed motions for summary judgment. Should plaintiff be sustained on its claimed right of recovery, the exact amount of allowances due will be determined pursuant to rule 38(c) of this court, 28 U.S.C.A.

The plaintiff corporation conducts and operates a correspondence school in New York State. Subsequent to the enactment of the Veterans' Readjustment Assistance Act of 1952, c. 875, § 101 et seq., 66 Stat. 663, 38 U.S.C.A. § 901 et seq. (hereinafter referred to as the "Act"), plaintiff obtained the necessary approval of its courses for the education and training of veterans of the Korean War as provided for in the Act.¹ Accordingly, plaintiff is an educational institution within the meaning of § 201 (6) of the Act.²

Sometime after August 20, 1952, the plaintiff has had enrolled among its students veterans who are eligible for the benefits provided under the Act, and who have been furnished approved courses by the plaintiff. As is required under §§ 231(c) (2) and 232(e) of the Act,³ the plaintiff has submitted to the Administrator of Veterans' Affairs certifications as to the number of lessons completed by the veterans and serviced by the school. In addition, the plaintiff has furnished to the Administrator necessary reports as to the enrollment, interruption, and termination of the education or training of each eligible veteran enrolled under the Act.⁴ Furthermore, changes in programs of training have necessitated the submission of additional forms by plaintiff.⁵

To help relieve the expenses that would be incurred by educational institutions in preparing and submitting reports and certifications under the Act, Congress inserted the following language in § 265(b) 38 U.S.C.A. § 975 (b):⁶

"The Administrator shall pay to each educational institution which is required to submit reports and certifications to the Administrator under this title, an allowance at the rate of $1.50 per month for each eligible veteran enrolled in and attending such institution under the provisions of this title to assist the educational institution in defraying the expense of preparing and submitting such reports and certifications. Such allowances shall be paid in such manner and at such times as may be prescribed by the Administrator, except that in the event any institution fails to submit reports or certifications to the Administrator as required by this title, no allowance shall be paid to such institution for the month or months during which such reports or certifications were not submitted as required by the Administrator."

On August 8, 1952, the Administrator of Veterans' Affairs by regulation, 38 CFR (1953 Supp.) § 21.2303(c) (3), provided that no administrative allowance shall be paid to an educational institution for a veteran enrolled in a course pursued exclusively by correspondence.⁷

The Administrator has denied a written request by plaintiff for payment of these allowances, and has refused to reconsider his denial of plaintiff's claim. Certification of payment of this claim has also been refused by the Comptroller General.

The plaintiff in this action challenges the validity of the regulation promulgated by the Administrator denying payment of administrative allowances to correspondence schools as being inconsistent with the provisions of the Act.⁸ It is contended by plaintiff that the Act expressly requires that the Administrator shall pay each educational institution such allowances; it neither expressly nor impliedly excludes correspondence schools from the category of institutions entitled to these payments.

In support of its motion for summary judgment, and in opposition to plaintiff's motion, the Government advances two arguments. First, plaintiff's suit is one to review a decision of the Administrator of Veterans' Affairs on a claim for payments under a statute administered by the Veterans Administration and is therefore an unconsented suit against the United States which must be dismissed. Secondly, the challenged regulation properly reflects the clearly-expressed intention of Congress and therefore the defendant is entitled to judgment.

The Government urges that the case be disposed of under the first issue on the strength of section 11 of the Act of October 17, 1940, 54 Stat. 1197, 38 U.S. C.A. § 11a-2, which provides:

"Notwithstanding any other provisions of law, except as provided in section 19 of the World War Veterans' Act, 1924, as amended, and in section 817 of the National Service Life Insurance Act of 1940, the decisions of the Administrator of Veterans' Affairs on any question of law or fact concerning a claim for benefits or payments under this or any other Act administered by the Veterans' Administration shall be final and conclusive and no other official or any court of the United States shall have power or jurisdiction to review any such decisions."

Assuming the applicability of section 11 to the instant claim, the fact that plaintiff here questions a regulation of the Administrator, rather than a particular decision, would not except its claim from the effect of section 11. Slocumb v. Gray, 1949, 86 U.S.App.D.C. 5, 179 F.2d 31. Moreover, Congress expressly recognized the applicability of section 11 to payments under the Veterans' Readjustment Assistance Act of 1952, argues the Government, by reason of § 261(a) of that Act, 38 U.S.C.A. § 971(a):

"* * * Notwithstanding the provisions of section 11 of the Act of October 17, 1940, as amended (54 Stat. 1193), payments under this title shall be subject to audit and review by the General Accounting Office as provided by the Budget and Accounting Act of 1921, as amended, and the Budget and Accounting Procedures Act of 1950."

While it is true that Congress has the power to prohibit judicial review of administrative decisions, Swift and Company v. United States, 1941, 38 F.Supp. 435, 93 Ct.Cl. 705, 710; United States v. Babcock, 1919, 250 U.S. 328, 39 S.Ct. 464, 63 L.Ed. 1011, we are of the opinion that the scope of section 11 does not include the "payments" here in dispute. That Congress intended the bar of section 11 to apply only to gratuities seems clear. The purpose of section 11 was to insure that the provisions of existing law remained in effect.⁹ The status of that law had been expressed in the decision of Lynch v. United States, 1934, 292 U.S. 571, 587, 54 S.Ct. 840, 78 L.Ed. 1434. There the Court had before it a "finality" statute similar to section 11.¹⁰ But as the Court indicated, the "finality" provision related only to grants to veterans — pensions, compensation allowances and special privileges, all of which are gratuities.

In the instant case the administrative allowances provided for under § 265(b) of the Act are not in the nature of gratuities. On the contrary, they are compensation for services performed by educational institutions on behalf of the Veterans Administration pursuant to the requirements imposed by the Act. For this reason we are satisfied that petitioner's claim is not barred by section 11 of the Act of October 17, 1940, supra, and is therefore properly within the jurisdiction of this court.

Defendant supports the questioned validity of the regulation denying administrative allowances to correspondence schools on the basis that eligible veterans are not attending such institutions within the meaning of § 265(b) of the Act. In brief, the Government urges that we adopt a meaning of the word "attending" that connotes physical presence.

Though it is true, as the Government indicates, that the cost data presented to Congress bearing on the expense to educational institutions of preparing and submitting records and certifications under the Act was compiled from a study conducted at the University of Minnesota and necessarily reflected an "attendance" factor in the estimated cost figures submitted,¹¹ it would appear that the cost study was prompted on the belief that the reporting requirements under the Act would impose an appreciable administrative burden on all schools affected by the terms of the Act. The purpose of that study was to indicate to Congress the extent of the added costs imposed under the reporting requirements of the statute. It was never suggested during the course of the hearings on this provision of the Act that correspondence schools, since they did not have students in attendance, would not incur added expenses under the Act, or should be treated differently in this respect than other educational institutions. As a result, recommendations on this matter by the Special Subcommittee on Veterans' Education and Rehabilitation, which had conducted hearings on the then pending legislation (H.R. 7656), were reflected in the report of the full Committee on Labor and Public Welfare, S.Rept.1824, 82d Cong., 2d Sess., filed June 25, 1952. Specifically, the committee recommended that § 265 of H.R. 7656 be amended to insert a subsection (b) providing as follows:

"(b) The Administrator shall pay to each educational institution, which is required to submit reports and certifications to the Administrator under this title, an allowance for each full-time eligible veteran or the prorata part thereof for each part-time eligible veteran to assist the educational institution in defraying the expense of

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