Statute of Limitations and Settlement of Equal Credit Opportunity Act Discrimination Claims Against the Department of Agriculture, 98-2

CourtOpinions of the Office of Legal Counsel of the Department of Justice
Decision Date29 January 1998
Docket Number98-2
PartiesStatute of Limitations and Settlement of Equal Credit Opportunity Act Discrimination Claims Against the Department of Agriculture

22 Op. O.L.C. 11

Statute of Limitations and Settlement of Equal Credit Opportunity Act Discrimination Claims Against the Department of Agriculture

No. 98-2

United States Department of Justice

January 29, 1998


DAWN JOHNSEN Acting Assistant Attorney General Office of Legal Counsel.

Statute of Limitations and Settlement of Equal Credit Opportunity Act Discrimination Claims Against the Department of Agriculture

The Attorney General may not waive the statute of limitations in the litigation or compromise of pending claims against the United States.

Absent a specific provision to the contrary, a statute of limitations on civil actions also should apply to administrative settlements of claims arising under that statute pursuant to 31 U.S.C. §3702.

31 U S.C. §3702 does not authorize the Department of Agriculture to pay compensatory damages in an administrative settlement of an ECOA claim if ECOA's two year statute of limitations has run.

Filing an administrative claim with USDA does not toll ECOA's statute of limitations.

Although ECOA's statute of limitations is, in appropriate circumstances, subject to the doctrines of equitable tolling and equitable estoppel, courts have rarely applied either doctrine against the United States.

MEMORANDUM OPINION FOR THE ASSOCIATE ATTORNEY GENERAL

This memorandum responds to your request for advice on whether the statute of limitations in the Equal Credit Opportunity Act, 15 U.S.C. §§ 1691-l691f (1994 & Supp. I 1995) ("ECOA"), applies to administrative settlements of ECOA claims. You also have asked us whether the government may waive the statute of limitations, and under what circumstances the statute of limitations might be tolled.

We have concluded that ECOA's statute of limitations does apply to administrative settlements of ECOA claims and that the statute of limitations cannot be waived by the United States, either in litigation or in the administrative process. As for tolling of the statute of limitations, we have concluded that filing an administrative complaint does not toll the limitations period for a civil action. While ECOA is, in relevant circumstances, subject to the doctrines of equitable tolling and equitable estoppel, courts infrequently apply these doctrines against the United States.

I. Background

In relevant part, ECOA prohibits any creditor from discriminating against any applicant, with respect to any aspect of a credit transaction, on the basis of race, color, religion, national origin, sex or marital status. 15 U.S.C. § 1691(a). A "creditor" under the act includes any person who regularly extends, renews, or continues credit. Id. § 1691a(e). A "person" is "a natural person, a corporation, [ 12] government or governmental subdivision or agency, trust, estate, partnership, cooperative, or association." Id. § 1691a(f).

Administrative enforcement of ECOA is divided among several federal agencies, each of which has authority over certain categories of creditors. Id. § 1691c(a). Enforcement responsibility not specifically committed to another federal agency is vested in the Federal Trade Commission ("FTC"), which is to use its powers under the Federal Trade Commission Act, 15 U.S.C.A. §§41-58 (West 1997), to enforce ECOA's requirements. 15 U.S.C. § 1691c(c). The Department of Agriculture's ("USDA's") farm credit programs fall under the authority of the FTC. The FTC has authorized USDA to process ECOA claims arising from USDA programs.[1]

Section 1691e of ECOA also provides for a private right of action against creditors who violate the discrimination prohibitions of the act. Under subsection (a), all creditors are liable for compensatory damages: "[a]ny creditor who fails to comply with any requirement imposed under this subchapter shall be liable to the aggrieved applicant for any actual damages sustained by such applicant acting either in an individual capacity or as a member of a class." Id. § 1691e(a). Subsection (d) authorizes the imposition of attorney's fees and costs in a successful action. Id. § 1691e(d). No private action may be brought later than two years after the occurrence of the violation, unless me Attorney General or die agency wim administrative enforcement responsibility commences an enforcement proceeding within two years. In that case, an applicant may bring a civil action within one year of the commencement of the enforcement proceeding. Id. § 1691e(f).

In a 1994 opinion, this Office opined that ECOA applies to federal agencies and tiiat it waives the sovereign immunity of the United States for monetary relief. Accordingly, we advised USDA diat the Secretary could provide monetary relief, attorney's fees, and costs in administrative settlements of ECOA discrimination claims if a court could award such relief in an action by an aggrieved person. Authority of USDA to Award Monetary Relief for Discrimination, 18 Op. O.L.C. 52 (1994) ("USDA Opinion"). USDA accepts and processes ECOA complaints pursuant to its process for investigating any discrimination complaint in its programs, which is set forth at 7 C.F.R. § 15.52 (1997). Those regulations permit any person to file a written complaint regarding discrimination in any program or facility directly administered by USDA. Id.

In October of 1998, fourteen plaintiffs filed a class action suit against USDA alleging that USDA had discriminated against diem, and other similarly situated individuals, on the basis of their race in the administration of farm loans and credit programs during the period of January 1983 to January 1997. Pigford v. Glickman, 182 F.R.D. 341 (D.D.C. 1998). The court granted a stay of that action to allow the plaintiffs and the United States to explore options for settling the [ 13] claims of the named plaintiffs and the putative class members. As part of the Department's consideration of settlement options, the Office of the Associate Attorney General asked this Office for oral advice on the application of ECOA's statute of limitations to claims in litigation and to claims in USDA's administrative settlement process. Subsequently, you asked for a formal opinion on the following questions: 1) can the United States waive the statute of limitations in an ECOA civil action; 2) does ECOA's statute of limitations apply to the administrative settlement of ECOA claims by USDA; 3) does the filing of an administrative complaint with USDA toll the statute of limitations; and 4) would the doctrines of equitable tolling or equitable estoppel apply to these cases?

Our analysis proceeds as follows. In Part II, we conclude that the Attorney General may not waive the statute of limitations in the litigation or compromise of these claims. In Part III, we conclude that because USDA may make administrative settlements of ECOA claims that include compensatory damages only where a court could award such relief, USDA may not waive the statute of limitations in administrative settlements. Part III also concludes that section 3702 of title 31 does not provide an independent basis of authority for the payment of administrative claims filed after expiration of the ECOA statute of limitations. Moreover, even where an administrative claim is filed within the ECOA statute of limitations, USDA may not make payment on the claim without relevant appropriations authority. We understand that USDA's appropriation authority, however, would provide no basis for paying compensatory damages under ECOA where the statute of limitations has expired and no timely claim was asserted in court. Part IV examines the circumstances in which ECOA's statute of limitations might be tolled. That part concludes that filing an administrative claim does not toll the statute of limitations on a civil action. It then concludes that although the doctrines of equitable tolling and equitable estoppel would apply to ECOA in appropriate circumstances, courts infrequently apply these doctrines against the United States.

II. Waiver in Litigation

Ordinarily, a civil action for compensatory damages under ECOA must be filed no later than two years from the date of occurrence of the violation. 15 U.S.C. § 1691e(f). However, when any agency responsible for administrative enforcement under § 1691c of ECOA commences an enforcement proceeding within two years from the date of the occurrence of the violation, or when the Attorney General commences a civil action under this section within two years from the date of the occurrence of the violation, "any applicant who has been a victim of the discrimination which is the subject of such proceeding or civil action may bring [ 14] an action under this section not later than one year after the commencement of that proceeding or action." 15 U.S.C. § 1691e(f).[2]

The federal courts and this Office have observed that the statute of limitations for a cause of action against the United States constitutes a term of consent to the waiver of sovereign immunity. See Memorandum for James W. Moorman, Assistant Attorney General, Land & Natural Resources Division, from John M. Harmon, Assistant Attorney General, Office of Legal Counsel, Re: Pueblo of Taos v. Andrus at 2 n.l (Mar. 30, 1979) (citing cases). The doctrine of sovereign immunity precludes suit against the United States without the consent of Congress, and the terms of its consent define the extent of a court's jurisdiction. See United States v. Mottaz, 476 U.S. 834, 841 (1986). In particular, " '[w]hen waiver legislation contains a statute of limitations, the limitations provision constitutes a condition on the waiver of sovereign immunity.' " Id. (quoting Block v. North Dakota, 461 U.S. 273, 287 (1983)). Because the terms of consent are established by Congress, see id., modifying the terms of consent requires legislative action. See, e.g., United States v. Garbutt Oil Co., 302 U.S. 528, 534-35 (1938) (discussing Tucker v. Alexander, 275 U.S. 228 (1927) ("no officer of the government has...

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