MILTARY LAW SECTION

· Home · Newsletter · CLE Programs · Applications · Case Law Updates

NATIONAL BAR ASSOCIATION'S
Military Law Section Newsletter

FEDERAL TORT CLAIMS ACT
BY: CPT PATRICK GREGORY, US ARMY JAG

The Federal Tort Claims Act (FTCA) is the product of an over thirty-year debate regarding the responsibility of the United States to victims of its torts that occur in the United States. The FTCA is the exclusive remedy for persons who suffer personal injury, death or property damages as a result of the negligent or wrongful acts or omissions of employees of the United States acting within the scope of their employment. Under the FTCA, the United States is liable for the acts or omissions of its employees acting within the scope of their employment under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.

While exclusive jurisdiction is granted to federal district courts for tort liability arising under the FTCA, a claimant must first exhaust all administrative remedies before a suit can be maintained. The administrative filing is a mandatory prerequisite to filing suit in federal district court that cannot be waived. There are many purposes for the administrative filing.

WHAT MUST BE FILED?
The claim presented must be a written demands for a sum certain, which is a specific demand for monetary compensation. The demand must be specific enough to allow the government agency to investigate the claim to determine its validity. Generally, upon notification of a potential claim, the government agency will provide the claimant with the appropriate forms to present the claim. However, in Farmers State Savings Bank v. FMHA, the court found that letters or demands specifying a sum certain could serve as a demand.

Most claimants have problems accessing the value of their injuries while they are still being treated for those injuries. Yet, the requirement for a sum certain is not waived because of a continuing injury. Claimants must exercise caution when presenting a claim when they are still in treatment. In most government agencies, the representative will work with the claimant and allow them to adjust the sum certain as the amount increases. However, in rare cases, the representative will not. Nonetheless, an agent's consent to allow a claimant to name a sum certain at a later date is not valid. In that case, the claimant has two options. The claimant can wait until she has completed treatment for her injuries. Or, the claimant can estimate the total cost of her treatment before it is complete. The choice is important because several courts have held that were an approximate or present amount of the claim is stated in the initial demand the claim may be limited to that amount.

If you have already submitted a demand for a sum certain, do not panic yet. Under the FTCA, a claimant has the right to amend her demand until final administrative action is taken on the claim. Hence, the claim can be amended until the claim is denied or a final offer for settlement is rejected. This also applies even when the two-year statute of limitations has run. However, only a demand for a certain sum can be amended. Therefore, the claimant must submit a valid demand before the two-year limitation period before the original claim can be amended. Further, any amendment automatically restarts the mandatory six-month investigative process allowed to investigate and research a claim. Thus, once the claim is amended, the claimant must wait another six months before filing a suit in federal district court.

WHERE MUST THE CLAIM BE FILED?
While previous versions of the FTCA allowed a claimant to file a demand with any federal agency, newer versions required the claimant to file the claim with the appropriate government agency. The statute of limitation is not tolled when the claim is mailed but when it is received by the appropriate government agency. The problem is that people who are not familiar with the hierarchy of the government may assume that the agency that committed the wrongful act is the appropriate government agency. However, simply because an agency receives federal funding does not make it an appropriate government agency. So, if you are flirting with the statute of limitation, you must file your claim directly with the appropriate government agency. To determine where that agency is located, contact the nearest military installation and speak to someone in the Post Claims Office.

If you are not close to a military installation and are not in danger of the limitation period expiring, you can present your claim to the government organization that caused your injury. Should you choose this route, ensure that you know the time and person who took your claim. Under the FTCA, when a claim is filed with the wrong government agency, that agency must forward the file to the appropriate federal agency. If the wrong agency does not forward the file to the appropriate agency, the statute of limitation is tolled. Be cautious of this approach. If you are unsure of the proper government agency, file your claim with the agency you believe to be correct. Allow as much time as possible for error. A claim filed with the wrong agency with little time left for the statute of limitation to run may cause your claim to be time bared. For example, the court, in Oquendo-Ayala v. U.S., found that a claim for false arrest by the DEA filed with the FBI and forwarded to the DEA after the statute of limitation has run is not timely filed.

Also, if there is more than one agency involved, file your claim with each agency. The claimant should also inform each agency of the other agencies' role in the claim. This will prevent one agency from denying your claim while it is still in the administrative process in another agency. Once the agencies learn that there are multiple agencies involved, they should notify the claimant of the agency that will serve as the primary agency. Unless the claimant is notified of this in writing, one agency cannot act upon a claim on behalf of the other agencies.

WHEN MUST THE CLAIM BE FILED?
The claimant has two years from the date the claim accrues to assert a demand. The claim usually accrues on the date of the negligent act or omission. However, in some cases it is not possible to determine when the actual negligent act or omission occurred. Consider a medical malpractice case in which a surgeon operates on a patient. The surgery appears to be successful. Yet, the surgeon discovers that one of the towels the surgical team used during the operation is missing. No one can account for it. Unfortunately, no one informs the patient that a towel is missing. Almost two years later, the patient starts experiencing abdominal pains. Several trips to the emergency room resulted in prescriptions to deal with the paid. Her personal physician finally got a clue and decided to x-ray her abdomen. The result is shocking. Two years later, the missing towel is found. In this case, the patient would not be aware of the negligent act or omission on the date that it occurred. Hence, the claim would not accrue until the patient discovered or should have discovered the negligent act or omission. Here, one might argue that the claim started to accrue once the x-rays revealed the towel in her stomach. While the government might argue that the claim accrued from the date the claimant initially sought additional medical treatment, the claimant should have two years from the date to she discovered or should have discovered the negligent act or omission to file a claim.

The two-year limitation period cannot end on a weekend or federal holiday. For example, where a claim accrued on 24 January, the statute of limitation starts on 25 January. If 24 January, and two years later, falls on a Saturday, the limitation period would not end until Monday. If the Monday following the weekend were a federal holiday, the two-year period would not have ended until Tuesday. Further, the two-year limitation period does not end when federal offices are closed. To illustrate, the Fort Sill Claims Office is usually closed two or more days each year because of weather. If the two-year limitation period runs on a day when a federal office is closed because of weather, the statute of limitation is extended until the office reopens.

One way to affect the tolling of the statute of limitations is when a claimant pursues alternative remedies through the government agency that commits the negligent act or omission. In Geyen v. Marsh, the plaintiff (an ex-service member) was undesirably discharged in 1972. The plaintiff submitted an appeal to his involuntary activation and discharge with the Army Board for the Correction of Military Records (ABCMR). The appeal requested that his discharge be upgraded to honorable. A final decision denying the plaintiff's request was not reached until 1982. The plaintiff filed suit contesting his activation and discharge and the denial to upgrade his discharge from undesirable to honorable. The court found that the limitation period had run on plaintiff's right to contest his 1972 activation and discharge. However, the court found that the plaintiff could file suit based on the ABCMR denial to upgrade his discharge from undesirable to honorable. In effect, the court reasoned that plaintiff's pursuit of administrative remedies tolled the statute of limitations and allowed him to file suit based on the administrative denial rather than the original activation and undesirable discharge.

The statute of limitations is also tolled when a claimant receives misleading information from a government representative that causes the claimant to take no action until after the limitation period has run. Consider a situation where a claimant filed a claim with the Department of Veterans Affairs (DVA) seeking a service connection to his chronic pulmonary disorder. The DVA denied his request. Claimant appealed. He was initially told he would need an attorney to appeal. When he discovered he could appeal without an attorney, the claimant went back to the DVA office and completed to appropriate form for the appeal. An employee at the agency told the claimant that she would ensure that the form got to the appropriate authority. The claimant later received a letter stating that he had exceeded the 120-day period allowed to file an appeal. The claimant filed suit after the two-year limitation period had run. The court reasoned that the misleading information provided to the claimant tolled the statute of limitation and the claimant's suit was not time barred.

WHEN CAN SUIT BE FILED?
Under the FTCA, the claimant has two windows of opportunity for filing suit in the federal district court. The first window opens six months after the appropriate government agency receives the claim. After the appropriate government agency receives a claim, it usually sends a letter acknowledging receipt of the claim. The acknowledgment letter is important because it determines when the mandatory six-month investigative period expires before a suit can be filed. If the claimant presents a claim under the FTCA and does not receive this letter, it would be wise to assume that the claim was not submitted to the appropriate governmental agency. However, this may not be the best option for filing suit.

The second window opens six months after final administrative action on the claim. In most cases this will be the best option. Since several courts have dismissed suits because the claimant did not exhaust all administrative remedies, the claimant may want to delay filing suit as long as there is satisfactory progress in the administrative proceedings. Besides, the two-year statute of limitations is tolled indefinitely during negotiations.

Once final action is taken, the claimant should receive a certified letter, return receipt requested, stating that the claim has been denied or a final settlement offer is made. Since the written demand does not have to inform the claimant of the requirement to file suit within six months, the burden is on the claimant to file suit within six months after final action. Final administrative action also includes rejection of a final settlement offer. Hence, once the claimant realized that there is no chance of settlement, suit should be filed in federal district court. Conversely, as long as progress is made toward settling the claim, the claimant should delay filing suit.

WHAT ELSE TO KNOW ABOUT THE ADMINISTRATIVE PROCESS?
There are several advantages to the mandatory administrative process. While a claimant is not required to have an attorney, once the claimant hires one, the governmental agency will deal the attorney. The claimant's attorney becomes the line of communication between the agency and the claimant. This purpose of this is to achieve an environment of cooperation that is more conducive to settlement. Government officials will also exercise such cautions when contacting the claimant's treating physician. For instance, the official should make contact with a private physician through the claimant. If the claimant has an attorney, the contact is made through the attorney. Physicians the government employs are treated a little differently. The official should notify the claimant (or his/her attorney) when making contact with a physician employed by the government concerning the injuries that are the subject of the claim. These rules should be followed regardless of the automatic waiver the claimants are subject to when filing a claim under the FTCA.

The mandatory administrative process also allows both parties to avoid costly and time-consuming formal discovery and unnecessary litigation. While an agency has authority to subpoena upon application to the District Court, the procedure is avoided to foster cooperation in the administrative process. The agency has the authority to release anything that is discoverable under the Federal Rules administratively. This includes names of expert witnesses, request under the Freedom of Information Act (FOIA), etc. The agency is however prohibited from releasing information that is prohibited under other federal laws, rules or regulations. For instance, the Privacy Act may prohibit an agency from releasing patients' records that were involved in the same or similar incident as the one being claimed. Attorneys and claimants must also abandon the adversarial persona for the administrative process to be fulfilled. That means freely sharing all the information needed to prove that a government employee acting within the course and scope of duty negligently injured the claimant and the resulting damages. Besides, Federal Rule 408 provides that evidence of conduct or statements made during compromise negotiations are not admissible at trial. The only exception may be when the evidence is used to show that the incident in question was not the result of an accident or mistake.

Further, the mandatory administrative process is much faster than the traditional adversarial process, including the larger claims. The process also reduces the courts' dockets. However, once a suit is filed, the agency losses the authority to settle a claim administratively. This leads to another issue that claimants and their attorneys should know. Who has the authority to settle the claim? Each armed service and the Veterans Administrative Office have the authority to settle claims for $200,000 or less. However, most services severely limit the settlement authority of their agents. The service's main claims office usually reserves the authority to settle large claims, usually those over $25,000. The Chief, Tort Branch, Civil Division and United States Attorneys have the authority to settle claims up to $1,000,000. Amounts above that must be approved at the Department of Justice. This includes settlements made by the agency or during the pretrial process. Settlements made by United States official not authorized to do so is ultra vires and void. Never forget this rule, because the agency where you initially filed the claim will do all the negotiating and eventually reach a tentative settlement (if one can be had). The agency with the authority to settle the claim must give final approval. Hence, negotiating with the agency official is a part of the administrative process. However, be sure that the proper settlement authority has approved of any settlement reached.

After settlement or judgment, the most controversial section of the FTCA must be addressed-attorney fees. How does the act deal with attorney fees? Attorney fees, as well as costs, are deducted from the settlement amount. Attorney fees were never considered payable as an addition to the settlement principal. USC §2678 limits attorney fees to 25 percent. Army Regulation 27-20 sets further limits on the amount of fees an attorney can charge. If the claim is settle administratively, the attorney fees are limited to 20 percent of the principal recovery. One check is issued for the settlement principal and the attorney fees. Should the attorney file suit, the attorney fees are limited to 25 percent. In this case, two checks are issued-one for the settlement principal and another for the attorney fees. The court will determine the amount of attorney fees in most cases. While an attorney gets more for filing suit, an attorney must not file suit in an effort to increase fees. At least one court has limited the attorney fees when a suit was filed for the purpose of increasing those fees.

WHAT IS THE BOTTOM LINE?
While the information provided in the writing should provide some guidance to the claimant, the most important thing is to file the claim with the appropriate government agency as soon as possible. Remember, there is a two-year limitation period. Even if you are still being treated for your injuries, file the claim. You can always amend your claim to increase the amount of your demand. In fact, the amount can be amended until suit is filed in federal district court.

Once your claim is presented to the appropriate government agency, that agency should provide you with the forms needed to get your file into the government system. Remember that the claim does not necessarily have to be the actual form. While the claim can be in the form of a letter, the FTCA allows government agencies to control the procedure for filing a claim. Most government agencies require you to complete certain forms that will provide it with the information needed to start an investigation of the matter. The government agency will also tell you everything you need to do in order to prove your claim. While this is technically an adversarial process, the government agency will ensure that the claimant has the opportunity to file the claim properly and present all the evidence to prove the claimant was injured by the negligence of a government employee acting within the scope of employment.

Done >

· Home · Newsletter · CLE Programs · Applications · Case Law Updates