Reminga v. U.S.

• Decision Date: 18 April 1983
• Docket Number: No. 81-1716,81-1716
• Citation: 695 F.2d 1000
• Parties: Gertrude REMINGA, Executrix of the Estate of Thomas H. Reminga, Deceased, and Barbara Sue Breeden, Executrix of the Estate of James Robert Breeden, Deceased, Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 1000

695 F.2d 1000

Gertrude REMINGA, Executrix of the Estate of Thomas H.

Reminga, Deceased, and Barbara Sue Breeden,

Executrix of the Estate of James Robert

Breeden, Deceased, Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.

No. 81-1716.

United States Court of Appeals, Sixth Circuit.

Argued Oct. 22, 1982.

Decided Dec. 16, 1982.

Certiorari Denied April 18, 1983. See 103 S.Ct. 1778.

Russell H. Volkema, Hans Scherner, Columbus, Ohio, Richard Walsh, Kalamazoo, Mich., for plaintiffs-appellants.

Robert C. Greene, U.S. Atty., Grand Rapids, Mich., Barbara B. O'Malley, Washington, D.C., for defendant-appellee.

Before KENNEDY and WELLFORD, Circuit Judges, and CECIL, Senior circuit judge.

CORNELIA G. KENNEDY, Circuit Judge.

Plaintiffs-appellants appeal the denial of interest on their judgments against the United States of America rendered under the Federal Tort Claims Act [28 U.S.C. Secs. 1346(b), 2411(b); 31 U.S.C. Sec. 724a]. The United States District Court for the Western District of Michigan held that appellants' failure to file a transcript of the judgments with the General Accounting Office (GAO) barred their recovery of interest. We affirm.

On January 19, 1978, appellants were awarded judgments against the United States under the FTCA for the wrongful deaths of their husbands. The judgments were affirmed by this Court on October 2, 1980 in the total sum of $701,151.00, with interest from the date of judgments and costs. ¹ Reminga v. United States, 448 F.Supp. 445 (W.D.Mich.1978), aff'd, 631 F.2d 449 (6th Cir.1980). After time for appeal to the Supreme Court had expired, counsel for appellants demanded payment from the Justice Department and was informed that certification for payment would be made by the Attorney General and transmitted to the General Accounting Office pursuant to 28 U.S.C. Sec. 2414. ²

The certification was transmitted to the GAO under cover letter dated March 16, 1981. It requested payment to be disbursed as set forth in footnote 1, and noted that costs had yet to be assessed against the United States. On May 5, 1981, appellants received checks covering only the principal due under the judgments. The government refused and still refuses to pay the interest awarded, asserting that appellants' failure to file a transcript of the judgments with the GAO bars their recovery of post-judgment interest.

Appellants moved for an order from the District Court requiring the government to pay interest on the judgments from January 19, 1978 (date judgments were entered) through May 5, 1981 (date principal was received) in the amount of $137,308.18, plus interest at the rate of 6% per year on that sum which will accrue from May 5, 1981 to the date of payment. Appellants' motion was denied in the order which they now appeal.

1. Statutory Provisions

Interest is recoverable against the United States only when specifically provided for by statute. United States v. Goltra, 312 U.S. 203, 207, 61 S.Ct. 487, 490, 85 L.Ed. 776 (1941); DeLucca v. United States, 670 F.2d 843, 846 (9th Cir.1982); Bituminous Casualty Corp. v. Lynn, 503 F.2d 636, 643 (6th Cir.1974); Gray v. Dukedom Bank, 216 F.2d 108, 110 (6th Cir.1954). The FTCA, 28 U.S.C. Sec. 2411(b), authorizes payment of interest by the United States on judgments entered against it. In pertinent part it provides:

(b) Except as otherwise provided in subsection (a) of this section, on all final judgments rendered against the United States in actions instituted under section 1346 of this title, interest shall be computed at the rate of 4 per centum per annum from the date of the judgment up to, but not exceeding, thirty days after the date of approval of any appropriation Act providing for payment of the judgment.

It is well settled that implicit in the power of Congress to waive sovereign immunity, and to subject the United States to liability for interest accrued on adverse judgments, is the authority to prescribe the terms and conditions under which the United States agrees to be liable. United States v. New York Rayon Importing Co., 329 U.S. 654, 659, 67 S.Ct. 601, 603, 91 L.Ed. 577 (1947); United States v. Thayer-West Point Hotel Co., 329 U.S. 585, 588-590, 67 S.Ct. 398, 399-400, 91 L.Ed. 521 (1947). See also Tillson v. United States, 100 U.S. 43, 46-47, 25 L.Ed. 543 (1879); United States v. Dansby, 509 F.Supp. 188, 195 (D.C.Ohio 1981). Thus, the government argues that section 2411(b) must be read in conjunction with 31 U.S.C. Sec. 724a. Section 724a is a permanent indefinite appropriations act for payment of interest on final judgments entered against the United States where claimant's payment was delayed solely because the United States appealed and lost. It states in pertinent part

[t]hat interest on a judgment of a district court to which the provisions of section 2411(b) of Title 28 apply, payable from this appropriation, shall be paid only when such judgment becomes final after review on appeal or petition by the United States, and then only from the date of the filing of the transcript thereof in the General Accounting Office to the date of the mandate of affirmance .... (emphasis added).

The federal interest statute is to be construed and applied according to its own purpose and meaning. Cleary v. Chalk, 488 F.2d 1315, 1322 (D.C.Cir.1973); United States v. State of Maryland for the Use of Meyer, 349 F.2d 693, 695 (D.C.Cir.1965); cf., Lynn, 503 F.2d at 641 (statute interpreted consistently with its legislative history). The primary purpose of Sec. 724a was to provide for prompt payment of judgments and thereby to eliminate or reduce the costs of interest to the government. United States v. Varner, 400 F.2d 369, 372 (5th Cir.1968), citing Chicago, Rock Island and Pacific R.R. Co. v. United States, 206 F.Supp. 795 (S.D.Iowa 1962); H.R.Rep. No. 2638, 84th Cong., 2d Sess. 72 (1957). Reference must be made then to the purposes of sections 1142(b) and 724a in order to reconcile the inconsistencies in their language.

As noted in DeLucca, 670 F.2d at 846-847:

31 U.S.C. Sec. 724a clearly overrides Sec. 2411(b) .... The differing language regarding interest and appropriation acts in Sec. 2411(b) is vestigial, remaining from pre-1977, when Sec. 724a only applied to judgments less than $100,000. Before 1977, "an individual who recover[ed] [an amount in excess of $100,000] must await a special appropriation, during which period interest accumulates" pursuant to 28 U.S.C. Sec. 2411(b). United States v. Maryland, 349 F.2d 693, 695 (D.C.Cir.1965). With the 1977 amendments to Sec. 724a removing the $100,000 limitation, the provision regarding interest in Sec. 724a completely overrides the contrary provision in Sec. 2411(b).

Thus, the language of Sec. 724a applies to the instant case and limits the government's liability for post-judgment interest to a period beginning with the date of the filing of the transcript of the judgments in the GAO. Indeed, appellants concede this to be the case but argue that the United States must bear the responsibility to file the transcript of judgments with the GAO, or alternatively, that the requirement violates due process.

The language of Sec. 724a which limits the liability of the government to interest accrued "from the date of filing," fails to specify who has the responsibility to file. Appellants contend that the language of the Act is not explicit enough to put them on notice of a duty to file and, therefore, they should not be penalized for their failure to comply.

Appellants argue that fairness places the responsibility to file on the government. Relying upon principles of agency, appellants argue that "[t]he public has the right to assume that what the Attorney General as agent of the General Accounting Office knows, is also known by the said General Accounting Office." Moreover, appellants argue that when the Attorney General undertook to pursue an appeal and, therefore, to delay prompt payment of the judgments to appellants, he obligated the United States to underwrite the accumulating interest during the time of appeal. Accordingly, appellants conclude that when, after the judgments were entered and filed with the District Court, copies were sent to the Attorney General, it was effectively filed with the GAO in compliance with Sec. 724a. Appellants' reliance on such principles of agency is misplaced.

Appellants' argument that justice demands we impose or assume knowledge on the part of the GAO as a necessary corollary of knowledge of the Attorney General is based on the assumption that Sec. 724a filing is required solely to ensure that the GAO have knowledge of the interest-bearing judgment pending appeal. There is no support for such an assumption. Explicit in the language and the legislative history of Sec. 724a is the desire of Congress to limit the liability of the United States for interest payments. One way to limit such payments is to defer the date on which interest begins to accrue from the date judgment was entered to the date on which the prospective recipient of the accrued interest files a transcript of judgment with the GAO. Also noted in the legislative history of Sec. 724a is the desire for continuity between provisions applicable to the payment of interest on judgments appealed from the court of claims and those appealed from the district courts. Provisions regarding the former required the filing of a transcript of judgment with the GAO. Continuity was obtained by imposing this provision on interest on judgments appealed from the district courts. As these varied purposes underlay the adoption of Sec. 724a, appellants' purported entitlement to interest does not necessarily turn upon whether the GAO knew, or can be presumed to have known, of the existence of the judgments during the appeal period.

Assuming arguendo that the principal purpose of the Sec. 724a filing requirement is to inform the GAO of the existence of interest-bearing judgments during the...