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Home » 2006 Issues » 71 FR (08/11/2006) » 06-6789. Claims Against the United States

  06-6789. Claims Against the United States  

  • Start Preamble Start Printed Page 46260

    AGENCY:

    Department of the Army, DOD.

    ACTION:

    Proposed rule; request for comments.

    SUMMARY:

    The Department of the Army proposes to amend its regulations to reflect a substantial revision of AR 27-20, an Army publication which governs the processing of claims worldwide. The purpose of this revision is to make AR 27-20 clearer and easier to use, after years of piecemeal amendments. This rewrite also ensures that AR 27-20 is in keeping with current statutes, legal opinions and Department of Justice guidance pertaining to claims processing. This updated rule will expedite payment of meritorious claims throughout the world.

    DATES:

    Comments submitted on or before October 10, 2006 will be considered.

    ADDRESSES:

    You may submit comments, identified by “32 CFR part 536, Docket No. USA-2006-0022 and or RIN 0702-AA54” in the subject line, by any of the following methods:

    • Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments.
    • Mail: Federal Docket Management System Office, 1160 Defense Pentagon, Washington, DC 20301-1160.

    Instructions: All submissions received must include the agency name and docket number or Regulatory Information Number (RIN) for this Federal Register document. The general policy for comments and other submissions from members of the public is to make these submissions available for public viewing on the Internet at http://www.regulations.gov as they are received without change, including any personal identifiers or contact information.

    Start Further Info

    FOR FURTHER INFORMATION CONTACT:

    George Westerbeke (301) 677-7009, x220.

    End Further Info End Preamble Start Supplemental Information

    SUPPLEMENTARY INFORMATION:

    A. Background

    This rule was previously published. The Administrative Procedure Act, as amended by the Freedom of Information Act requires that certain policies and procedures and other information concerning the Department of the Army be published in the Federal Register. The policies and procedures covered by this regulation fall into that category.

    AR 27-20 and its companion DA Pam 27-162 will be available on the Web site of the U.S. Army Publications Directorate, http://www.apd.army.mil,, within a few months of the date of this Federal Register publication of 32 CFR part 536. Users are encouraged to consult the online versions, whose structure and paragraph numbering are comparable.

    B. Regulatory Flexibility Act

    The Department of the Army has determined that the Regulatory Flexibility Act does not apply because the proposed rule does not have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601-612.

    C. Unfunded Mandates Reform Act

    The Department of the Army has determined that the Unfunded Mandates Reform Act does not apply because the proposed rule does not include a mandate that may result in estimated costs to State, local or tribal governments in the aggregate, or the private sector, of $100 million or more.

    D. National Environmental Policy Act

    The Department of the Army has determined that the National Environmental Policy Act does not apply because the proposed rule does not have an adverse impact on the environment.

    E. Paperwork Reduction Act

    The Department of the Army has determined that the Paperwork Reduction Act does not apply because the proposed rule does not involve collection of information from the public.

    F. Executive Order 12630 (Government Actions and Interference With Constitutionally Protected Property Rights)

    The Department of the Army has determined that Executive Order 12630 does not apply because the proposed rule does not impair private property rights.

    G. Executive Order 12866 (Regulatory Planning and Review)

    The Department of the Army has determined that according to the criteria defined in Executive Order 12866 this proposed rule is not a significant regulatory action. As such, the proposed rule is not subject to Office of Management and Budget review under section 6(a)(3) of the Executive Order.

    H. Executive Order 13045 (Protection of Children From Environmental Health Risk and Safety Risks)

    The Department of the Army has determined that according to the criteria defined in Executive Order 13045 this proposed rule does not apply.

    I. Executive Order 13132 (Federalism)

    The Department of the Army has determined that according to the criteria defined in Executive Order 13132 this proposed rule does not apply because it will not have a substantial effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

    Start Signature

    Col. Dale Woodling,

    Commander, United States Army Claims Service.

    End Signature Start List of Subjects

    List of Subjects in 32 CFR Part 536

    • Claims
    • Government employees
    • Military personnel
    End List of Subjects

    For reasons stated in the preamble the Department of the Army proposes to revise 32 CFR part 536 to read as follows:

    Start Part

    PART 536—CLAIMS AGAINST THE UNITED STATES

    Subpart A—The Army Claims System
    536.1
    Purpose of the Army Claims System.
    536.2
    Claims authorities.
    536.3
    Command and organizational relationships.
    536.4
    Designation of claims attorneys.
    536.5
    The Judge Advocate General.
    536.6
    The Army claims mission.
    536.7
    Responsibilities of the Commander USARCS.
    536.8
    Responsibilities and operations of command claims services.
    536.9
    Responsibilities and operations of area claims offices.
    536.10
    Responsibilities and operations of claims processing offices.
    536.11
    Chief of Engineers.
    536.12
    Commanding General, U.S. Army Medical Command.
    536.13
    Chief, National Guard Bureau.
    536.14
    Commanders of major Army commands.
    536.15
    Claims policies.
    536.16
    Release of information policies.
    536.17
    Single-service claims responsibility (DODD 5515.8 and DODD 5515.9).
    536.18
    Cross-servicing of claims.
    536.19
    Disaster claims planning.
    536.20
    Claims assistance visits.
    536.21
    Annual claims award.
    Start Printed Page 46261 Subpart B—Investigation and Processing of Claims
    536.22
    Claims investigative responsibility—general.
    536.23
    Identifying claims incidents both for and against the government.
    536.24
    Delegation of investigative responsibility.
    536.25
    Procedures for accepting claims.
    536.26
    Identification of a proper claim.
    536.27
    Identification of a proper claimant.
    536.28
    Claims acknowledgment.
    536.29
    Revision of filed claims.
    536.30
    Action upon receipt of claim.
    536.31
    Opening claim files.
    536.32
    Transfer of claims among armed services branches.
    536.33
    Use of small claims procedures.
    536.34
    Determination of correct statute.
    536.35
    Unique issues related to environmental claims.
    536.36
    Related remedies.
    536.37
    Importance of the claims investigation.
    536.38
    Elements of the investigation.
    536.39
    Use of experts, consultants and appraisers.
    536.40
    Conducting the investigation.
    536.41
    Determination of liability—generally.
    536.42
    Constitutional torts.
    536.43
    Incident to service.
    536.44
    FECA and LSHWCA claims exclusions.
    536.45
    Statutory exceptions.
    536.46
    Other exclusions.
    536.47
    Statute of limitations.
    536.48
    Federal employee requirement.
    536.49
    Scope of employment requirement.
    536.50
    Determination of damages—applicable law.
    536.51
    Collateral source rule.
    536.52
    Subrogation.
    536.53
    Evaluation of claims—general rules and guidelines.
    536.54
    Joint tortfeasors.
    536.55
    Structured settlements.
    536.56
    Negotiations—purpose and extent.
    536.57
    Who should negotiate.
    536.58
    Settlement negotiations with unrepresented claimants.
    536.59
    Settlement or approval authority.
    536.60
    Splitting property damage and personal injury claims.
    536.61
    Advance payments.
    536.62
    Action memorandums.
    536.63
    Settlement agreements.
    536.64
    Final offers.
    536.65
    Denial notice 536.66 The “Parker” denial.
    536.67
    Mailing procedures.
    536.68
    Appeal or reconsideration.
    536.69
    Retention of file.
    536.70
    Preparation and forwarding of payment vouchers.
    536.71
    Fund sources.
    536.72
    Finality of settlement.
    Subpart C—Claims Cognizable Under the Military Claims Act
    536.73
    Statutory authority for the Military Claims Act.
    536.74
    Scope for claims under the Military Claims Act.
    536.75
    Claims payable under the Military Claims Act.
    536.76
    Claims not payable under the Military Claims Act.
    536.77
    Applicable law for claims under the Military Claims Act.
    536.78
    Settlement authority for claims under the Military Claims Act.
    536.79
    Action on appeal under the Military Claims Act.
    536.80
    Payment of costs, settlements, and judgments related to certain medical malpractice claims.
    536.81
    Payment of costs, settlements, and judgments related to certain legal malpractice claims.
    536.82
    Reopening an MCA claim after final action by a settlement authority.
    Subpart D—Claims Cognizable Under the Federal Tort Claims Act
    536.83
    Statutory authority for the Federal Tort Claims Act.
    536.84
    Scope for claims under the Federal Tort Claims Act .
    536.85
    Claims payable under the Federal Tort Claims Act.
    536.86
    Claims not payable under the Federal Tort Claims Act.
    536.87
    Applicable law for claims under the Federal Tort Claims Act.
    536.88
    Settlement authority for claims under the Federal Tort Claims Act.
    536.89
    Reconsideration of Federal Tort Claims Act claims.
    Subpart E—Claims Cognizable Under the Non-Scope Claims Act
    536.90
    Statutory authority for the Non-Scope Claims Act.
    536.91
    Scope for claims under the Non-Scope Claims Act.
    536.92
    Claims payable under the Non-Scope Claims Act.
    536.93
    Claims not payable under the Non-Scope Claims Act.
    536.94
    Settlement authority for claims under the Non-Scope Claims Act.
    536.95
    Reconsideration of Non-Scope Claims Act claims.
    Subpart F—Claims Cognizable Under the National Guard Claims Act
    536.96
    Statutory authority for the National Guard Claims Act.
    536.97
    Scope for claims under the National Guard Claims Act.
    536.98
    Claims payable under the National Guard Claims Act.
    536.99
    Claims not payable under the National Guard Claims Act.
    536.100
    Applicable law for claims under the National Guard Claims Act.
    536.101
    Settlement authority for claims under the National Guard Claims Act.
    536.102
    Actions on appeal under the National Guard Claims Act.
    Subpart G—Claims Cognizable Under International Agreements
    536.103
    Statutory authority for claims cognizable under international claims agreements.
    536.104
    Current agreements in force.
    536.105
    Responsibilities generally/international agreements claims.
    536.106
    Definitions for international agreements claims.
    536.107
    Scope for international agreements claims arising in the United States.
    536.108
    Claims payable under international agreements (for those arising in the United States).
    536.109
    Claims not payable under international agreements (for those arising in the United States).
    536.110
    Notification of incidents arising under international agreements (for claims arising in the United States).
    536.111
    Investigation of claims arising under international agreements (for those claims arising in the United States).
    536.112
    Settlement authority for claims arising under international agreements (for those claims arising in the United States).
    536.113
    Assistance to foreign forces for claims arising under international agreements (as to claims arising in the United States).
    536.114
    Scope for claims arising overseas under international agreements.
    536.115
    Claims procedures for claims arising overseas under international agreements.
    536.116
    Responsibilities as to claims arising overseas under international agreements.
    Subpart H—Maritime Claims
    536.117
    Statutory authority for maritime claims.
    536.118
    Related statutes for maritime claims.
    536.119
    Scope for maritime claims.
    536.120
    Claims payable as maritime claims.
    536.121
    Claims not payable as maritime claims.
    536.122
    Limitation of settlement of maritime claims.
    536.123
    Limitation of liability for maritime claims.
    536.124
    Settlement authority for maritime claims.
    Subpart I—Claims Cognizable Under Article 139, Uniform Code of Military Justice
    536.125
    Statutory authority for Uniform Code of Military Justice (UCMJ) claims.
    536.126
    Purpose of UCMJ claims.
    536.127
    Proper claimants; unknown accused—under the UCMJ.
    536.128
    Effect of disciplinary action, voluntary restitution, or contributory negligence for claims under the UCMJ.
    536.129
    Claims cognizable as UCMJ claims.
    536.130
    Claims not cognizable as UCMJ claims.
    536.131
    Limitations on assessments arising from UCMJ claims.
    536.132
    Procedure for processing UCMJ claims.
    536.133
    Reconsideration of UCMJ claims .
    536.134
    Additional claims judge advocate and claims attorney responsibilities (for UCMJ claims).
    Subpart J—Claims Cognizable Under the Foreign Claims Act
    536.135
    Statutory authority for the Foreign Claims Act.
    536.136
    Scope for claims arising under the Foreign Claims Act.
    536.137
    Claims payable under the Foreign Claims Act. Start Printed Page 46262
    536.138
    Claims not payable under the Foreign Claims Act.
    536.139
    Applicable law for claims under the Foreign Claims Act.
    536.140
    Appointment and functions of Foreign Claims Commissions.
    536.141
    Composition of Foreign Claims Commissions.
    536.142
    Qualification of members of Foreign Claims Commissions.
    536.143
    Settlement authority of Foreign Claims Commissions.
    536.144
    Reopening a claim after final action by a Foreign Claims Commission.
    536.145
    Solatia payment.
    Subpart K—Nonappropriated Fund Claims
    536.146
    Claims against nonappropriated fund employees—generally.
    536.147
    Claims by NAFI employees for losses incident to employment.
    536.148
    Claims generated by the acts or omissions of NAFI employees.
    536.149
    Identification of persons whose actions may generate liability.
    536.150
    Claims payable from appropriated funds.
    536.151
    Settlement authority for claims generated by acts or omissions of NAFI employees.
    536.152
    Payment of claims generated by acts or omissions of NAFI employees.
    536.153
    Claims involving tortfeasors other than nonappropriated fund employees: NAFI contractors.
    536.154
    Claims involving tortfeasors other than nonappropriated fund employees: NAFI risk management program (RIMP) claims.
    536.155
    Claims payable involving tortfeasors other than nonappropriated fund employees.
    536.156
    Procedures for claims involving tortfeasors other than nonappropriated fund employees.
    536.157
    Settlement/approval authority for claims involving tortfeasors other than nonappropriated fund employees.
    Start Authority

    Authority: 10 U.S.C. 2733; 10 U.S.C. 1089; 10 U.S.C. 1054; 28 U.S.C. 1291, 2401-2402, 2411-2412, 2671-2680; 10 U.S.C. 2737; 32 U.S.C. 715; 10 U.S.C. 2734a, 2734b; 10 U.S.C. 2734;10 U.S.C. 4801, 4802, 4806; 46 U.S.C. app. 740; 39 U.S.C. 411; 10 U.S.C. 939; 10 U.S.C. 2736; 10 U.S.C. 2735; 10 U.S.C. 2731.

    End Authority End Part Start Part

    PART 536—CLAIMS AGAINST THE UNITED STATES

    Subpart A—The Army Claims System

    Purpose of the Army Claims System.

    This part sets forth policies and procedures that govern the investigating, processing, and settling of claims against, and in favor of, the United States under the authority conferred by statutes, regulations, international and interagency agreements, and Department of Defense Directives (DODDs). It is intended to ensure that claims are investigated properly and adjudicated according to applicable law, and valid recoveries and affirmative claims are pursued against carriers, third-party insurers, and tortfeasors.

    Claims authorities.

    (a) General. Claims cognizable under the following list of statutes and authorities are processed and settled under DA Pam 27-162 and this part. All of these materials may be viewed on the USARCS Web site, https://www.jagcnet.army.mil/​85256F33005C2B92/​(JAGCNETDocID)/​HOME?​OPENDOCUMENT. Select the link “Claims Resources.”

    (1) Tort Claims. (i) The Military Claims Act (MCA), 10 United States Code (U.S.C.) 2733 (see Subpart C of this part). The “incident-to-service” provision, applicable to both military and civilian personnel of the Department of Defense, is contained in the MCA.

    (ii) The Gonzales Act, 10 U.S.C. 1089. This act permits individual suits against health care providers for certain torts (see § 536.80).

    (iii) Certain suits arising out of legal malpractice, 10 U.S.C. 1054, discussed at § 536.81 and at DA Pam 27-162, paragraph 2-62f.

    (iv) The Federal Tort Claims Act (FTCA), 28 U.S.C. 1291, 1402, 2401-2402, 2411-2412, and 2671-2680 (see Subpart D of this part). The Westfall Act, 28 U.S.C. 2679, an integral part of the FTCA, provides absolute immunity from individual suit for common law torts for employees of the United States acting within the scope of their employment.

    (A) The legislative history of the FTCA.

    (B) Regulations of the Attorney General implementing the Federal Tort Claims Act, 28 CFR part 14.

    (C) An Appendix to 28 CFR part 14 sets forth certain delegations of settlement authority to the Secretary of Veterans Affairs, the Postmaster General, the Secretary of Defense, the Secretary of Transportation, and the Secretary of Health and Human Services.

    (v) The Non-Scope Claims Act (NSCA), 10 U.S.C. 2737 (see Subpart E of this part).

    (vi) The National Guard Claims Act (NGCA), 32 U.S.C. 715 (see Subpart F of this part).

    (vii) Claims under International Agreements or the Foreign Claims Act.

    (A) International Agreements Claims Act (IACA), 10 U.S.C. 2734a and 2734b.

    (B) Foreign Claims Act (FCA), 10 U.S.C. 2734 (see Subpart J of this part). (viii) The Army Maritime Claims Settlement Act (AMCSA), 10 U.S.C. 4801, 4802 and 4806. Affirmative claims under the AMCSA are processed under 10 U.S.C. 4803 and 4804 (see § 537.16 of this chapter).

    (ix) Admiralty Extension Act (AEA), 46 U.S.C. app. 740 (see Subpart H of this part).

    (x) Claims against nonappropriated fund (NAF) activities and the risk management program (RIMP) (see Subpart K of this part), processed under Army Regulation (AR) 215-1 and AR 608-10.

    (xi) Claims by the U.S. Postal Service for losses or shortages in postal accounts caused by unbonded Army personnel (39 U.S.C. 411 and Department of Defense (DOD) Manual 4525.6-M).

    (2) Personnel Claims (subpart I of this part and AR 27-20, chapter 11).

    (i) The Personnel Claims Act (PCA), 31 U.S.C. 3721 (see AR 27-20, chapter 11).

    (ii) Redress of injuries to personal property, Uniform Code of Military Justice (UCMJ), Article 139, 10 U.S.C. 939 (see Subpart I of this part).

    (3) Affirmative Claims (32 CFR part 537).

    (i) The Federal Claims Collection Act (FCCA), 31 U.S.C. 3711-3720E.

    (ii) The Federal Medical Care Recovery Act (FMCRA), 42 U.S.C. 2651-2653.

    (iii) Collection from third-party payers of reasonable costs of healthcare services, 10 U.S.C. 1095 .

    (b) Fund source authority for claims under Title 10 statutes. 10 U.S.C. 2736, advance payments for certain property claims (see § 536.71).

    (c) Fund source authority for tort claims paid by Financial Management Service (FMS). 31 U.S.C. 1304, provides authority for judgments, awards and compromise settlements.

    (d) Additional authorities under Title 10.

    (1) 10 U.S.C. 2735, establishes that settlements (or “actions”) under the Title 10 claims processing statutes are final and conclusive.

    (2) 10 U.S.C. 2731, provides a definition of the word “settle.”

    (e) Related remedies statutes. The Army frequently receives claims or inquiries that are not cognizable under the statutory and other authorities administered by the U.S. Army under this publication and DA Pam 27-162. Every effort should be made to refer the claim or inquiry to the proper authority following the guidance in § 536.34 or § 536.36. (See also the corresponding paragraphs 2-15 and 2-17, respectively, in DA Pam 27-162). Some authorities for related remedies are used more frequently than others. Where an authority for a related remedy is frequently used, it is listed below and is Start Printed Page 46263posted on the USARCS Web site (for the address see § 536.2(a)).

    (1) Tucker Act, 28 U.S.C. 1346, provides exclusive jurisdiction in the Court of Federal Claims over causes of actions alleging property loss caused by a Fifth Amendment “taking.”

    (2) Maritime authority statutes, Public Vessels Act (PVA), 46 U.S.C. app. 781-790, Suits in Admiralty Act (SIAA), 46 U.S.C. app. 741-752, and the Rivers and Harbors Act, 33 U.S.C. 408 and 412.

    (3) Federal Employees Compensation Act (FECA), two excerpts: 5 U.S.C. 8116 and 8140, providing guidance on personal injury and death claims by civilian employees arising within the scope of their employment (see DA Pam 27-162, paragraph 2-15b) and information on certain claims by Reserve Officers Training Corps (ROTC) cadets, respectively, (see DA Pam 27-162, paragraph 2-17d(2)).

    (4) Longshore and Harbor Workers Compensation Act (LHWCA), 33 U.S.C. 901-950.

    (5) Claims for consequential property damage by civilian employees may only be considered in the Court of Federal Claims pursuant to 28 U.S.C. 1491.

    (f) Additional materials. There are some additional authoritative materials for the processing of claims, mostly of an administrative nature. For a complete listing of all of the supplementary materials relevant to claims processing under this publication and DA Pam 27-162 see Appendix B of DA Pam 27-162.

    (g) Conflict of authorities. Where a conflict exists between a general provision of this publication and a specific provision found in one of this publication's subparts implementing a specific statute, the specific provision, as set forth in the statute, will control.

    Command and organizational relationships.

    (a) The Secretary of the Army. The Secretary of the Army (SA) heads the Army Claims System and acts on certain claims appeals directly or through a designee.

    (b) The Judge Advocate General. The SA has delegated authority to The Judge Advocate General (TJAG) to assign areas of responsibility and designate functional responsibility for claims purposes. TJAG has delegated authority to the Commander USARCS to carry out the responsibilities assigned in § 536.7 and as otherwise lawfully delegable.

    (c) U.S. Army Claims Service. USARCS, a command and component of the Office of TJAG, is the agency through which the SA and TJAG discharge their responsibilities for the administrative settlement of claims worldwide (see AR 10-72). USARCS' mailing address is: U.S. Army Claims Service, 4411 Llewellyn Ave., Fort George G. Meade, MD 20755-5360, Commercial: (301) 677-7009.

    (d) Command claims services. (1) Command claims services exercise general supervisory authority over claims matters arising within their assigned areas of operation. Command claims services will:

    (i) Effectively control and supervise the investigation of potentially compensable events (PCEs) occurring within the command's geographic area of responsibility, in other areas for which the command is assigned claims responsibility, and during the course of the command's operations.

    (ii) Provide services for the processing and settlement of claims for and against the United States.

    (2) The Commander USARCS may delegate authority to establish a command claims service to the commander of a major overseas command or other commands that include areas outside the United States, its territories and possessions.

    (i) When a large deployment occurs, the Commander USARCS may designate a command claims service for a limited time or purpose, such as for the duration of an operation and for the time necessary to accomplish the mission. The appropriate major Army command (MACOM) will assist the Commander USARCS in obtaining resources and personnel for the mission.

    (ii) In coordination with the Commander USARCS, the MACOM will designate the area of responsibility for each new command claims service.

    (3) A command claims service may be a separate organization with a designated commander or chief. If it is part of the command's Office of the Staff Judge Advocate (SJA), the SJA will also be the chief of the command claims service, however, the SJA may designate a field grade officer as chief of the service.

    (e) Area claims offices. The following may be designated as area claims offices (ACOs):

    (1) An office under the supervision of the senior judge advocate (JA) of each command or organization so designated by the Commander USARCS. The senior JA is the head of the ACO.

    (2) An office under supervision of the senior JA of each command in the area of responsibility of a command claims service so designated by the chief of that service after coordination with the Commander USARCS. The senior JA is the head of the ACO.

    (3) The office of counsel of each U.S. Army Corps of Engineers (COE) district within the United States and such other COE commands or agencies as designated by the Commander USARCS, with concurrence of the Chief Counsel, Office of the Chief of Engineers, for all claims generated within such districts, commands or agencies. The district counsel or the attorney in charge of the command's or agency's legal office is the head of the ACO.

    (f) Claims processing offices. Claims processing offices (CPOs) are normally small legal offices or ACO subordinate elements, designated by the Commander USARCS, a command claims service or an ACO. These offices are established for the investigation of all actual and potential claims arising within their jurisdiction, on either an area, command or agency basis. There are four types of claims processing offices (see § 536.10):

    (1) Claims processing offices without approval authority.

    (2) Claims processing offices with approval authority.

    (3) Medical claims processing offices.

    (4) Special claims processing offices.

    (g) Limitations on delegation of authority under any subpart. (1) The Commander USARCS, commanders or chiefs of command claims services, or the heads of ACOs or CPOs with approval authority may delegate, in writing, all or any portion of their monetary approval authority to subordinate JAs or claims attorneys in their services or offices.

    (2) The authority to act upon appeals or requests for reconsideration, to deny claims (including disapprovals based on substantial fraud), to grant waivers of maximum amounts allowable, or to make final offers will not be delegated except that the Commander USARCS may delegate this authority to USARCS Division Chiefs.

    (3) CPOs will provide copies of all delegations affecting them to the ACO and, if so directed, to command claims services.

    Designation of claims attorneys.

    (a) Who may designate. The Commander USARCS, the senior JA of a command having a command claims service, the chief of a command claims service, the head of an ACO, or the Chief Counsel of a COE District, may designate a qualified attorney other than a JA as a claims attorney. The head of an ACO may designate a claims attorney to act as a CPO with approval authority.

    (b) Eligibility. To qualify as a claims attorney, an individual must be a civilian employee of the Department of the Army (DA) or DOD, a member of the bar of a state, the District of Columbia, or a jurisdiction where U.S. federal law applies, serving in the grade of GS-11 Start Printed Page 46264or above, and performing primary duties as a legal adviser.

    The Judge Advocate General.

    TJAG has worldwide Army Staff responsibility for administrative settlement of claims by and against the U.S. government, generated by employees of the U.S. Army and DOD components other than the Departments of the Navy and Air Force. Where the Army has single-service responsibility, TJAG has responsibility for the Army. See DODD 5515.9. Certain claims responsibilities of TJAG are exercised by The Assistant Judge Advocate General (TAJAG) as set forth in this part and directed by TJAG.

    The Army claims mission.

    (a) Promptly investigate potential claims incidents with a view to determining the degree of the Army's exposure to liability, the damage potential, and when the third party is at fault, whether the Army should take action to collect for medical expenses, lost wages and property damage.

    (b) Efficiently and expeditiously dispose of claims against the U.S. by fairly settling meritorious claims at the lowest level within the claims system commensurate with monetary jurisdiction delegated, or by denying non-meritorious claims.

    (c) Develop a system that has a high level of proficiency, so that litigation and appeals can be avoided or kept to a minimum.

    Responsibilities of the Commander USARCS.

    The Commander USARCS shall:

    (a) Supervise and inspect claims activities worldwide.

    (b) Formulate and implement claims policies and uniform standards for claims office operations.

    (c) Investigate, process and settle claims beyond field office monetary authority and consider appeals and requests for reconsideration on claims denied by the field offices.

    (d) Supervise the investigation, processing, and settlement of claims against, and in favor of, the United States under the statutes and regulations listed in § 536.2 and pursuant to other appropriate statutes, regulations, and authorizations.

    (e) Designate ACOs, CPOs, and claims attorneys within DA and DOD components other than the Departments of the Navy and Air Force, subject to concurrence of the commander concerned.

    (f) Designate continental United States (CONUS) geographic areas of claims responsibility.

    (g) Recommend action to be taken by the SA, TJAG or the U.S. Attorney General, as appropriate, on claims in excess of $25,000 or the threshold amount then current under the FTCA, on claims in excess of $100,000 or the threshold amount then current under the FCA, the MCA, the NGCA, AMCSA, FCCA and FMRCA and on other claims that have been appealed. Direct communication with Department of Justice (DOJ) and the SA's designee is authorized.

    (h) Operate the “receiving State office” for claims arising in the United States, its territories, commonwealths and possessions cognizable under Article VIII of the North Atlantic Treaty Organization (NATO) Status of Forces Agreement (SOFA), Partnership for Peace (PFP) SOFA, Article XVI of the Singapore SOFA, and other SOFAs which have reciprocal claims provisions as delegated by TJAG, as implemented by 10 U.S.C. 2734a and 2734b (Subpart G of this part).

    (i) Settle claims of the U.S. Postal Service for reimbursement under 39 U.S.C. 411 (see DOD Manual 4525.6-M).

    (j) Settle claims against carriers, warehouse firms, insurers, and other third parties for loss of, or damage to, personal property of DA or DOD soldiers or civilians incurred while the goods are in storage or in transit at government expense (AR 27-20, chapter 11).

    (k) Formulate and recommend legislation for Congressional enactment of new statutes and the amendment of existing statutes considered essential for the orderly and expeditious administrative settlement of noncontractual claims.

    (l) Perform post-settlement review of claims.

    (m) Prepare, justify, and defend estimates of budgetary requirements and administer the Army claims budget.

    (n) Maintain permanent records of claims for which TJAG is responsible.

    (o) Assist in developing disaster and maneuver claims plans designed to implement the responsibilities set forth in § 536.9(a)(12).

    (p) Develop and maintain plans for a disaster or civil disturbance in those geographic areas that are not under the jurisdiction of an area claims authority and in which the Army has single-service responsibility or in which the Army is likely to be the predominant Armed Force.

    (q) Take initial action, as appropriate, on claims arising in emergency situations.

    (r) Provide assistance as available or take appropriate action to ensure that command claims services and ACOs are carrying out their responsibilities as set forth in §§ 536.8 and 536.9, including claims assistance visits.

    (s) Serve as proponent for the database management systems for torts, personnel and affirmative claims and provide standard automated claims data management programs for worldwide use.

    (t) Ensure proper training of claims personnel.

    (u) Coordinate claims activities with the Air Force, Navy, Marine Corps, and other DOD agencies to ensure a consistent and efficient joint service claims program.

    (v) Investigate, process and settle, and supervise the field office investigation and processing of, medical malpractice claims arising in Army medical centers within the United States; provide medical claims judge advocates (MCJAs), medical claims attorneys, and medical claims investigators assigned to such medical centers with technical guidance and direction on such claims.

    (w) Coordinate support with the U.S. Army Medical Command (MEDCOM) on matters relating to medical malpractice claims.

    (x) Issue an accounting classification to all properly designated claims settlement and approval authorities.

    (y) Perform the investigation, processing, and settlement of claims arising in areas outside command claims service areas of operation.

    (z) Maintain continuous worldwide deployment and operational capability to furnish claims advice to any legal office or command throughout the world. When authorized by the chain of command or competent authority, issue such claims advice or services, including establishing a claims system within a foreign country, interpreting claims aspects of international agreements, and processing claims arising from Army involvement in civil disturbances, chemical accidents under the Chemical Energy Stockpile Program, other man-made or natural disasters, and other claims designated by competent authority.

    (aa) Upon receiving both the appropriate authority's directive or order and full fiscal authorization, disburse the funds necessary to administer civilian evacuation, relocation, and similar initial response efforts in response to a chemical disaster arising at an Army facility.

    (bb) Respond to all inquiries from the President, members of Congress, military officials, and the general public on claims within USARCS' responsibility.

    (cc) Serve as the proponent for this publication and DA Pam 27-162, both Start Printed Page 46265of which set forth guidance on personnel, tort, disaster and affirmative claims, as well as claims management and administration.

    (dd) Provide supervision for the Army's affirmative claims and carrier recovery programs, as well as other methods for recovering legal debts.

    (ee) Provide support for the overseas environmental claims program as designated by the DA.

    (ff) Execute other claims missions as designated by DOD, DA, TJAG and other competent authority.

    (gg) Appoint Foreign Claims Commissions outside Command Claims Services' geographic areas of responsibility.

    (hh) Budget for and fund claims investigations and activities; such as per diem and transportation of claims personnel, claimants and witnesses; independent medical examinations; appraisals; independent expert opinions; long distance telephone calls; recording and photographic equipment; use of express mail or couriers; and other necessary expenses.

    Responsibilities and operations of command claims services.

    (a) Chiefs of command claims services. Chiefs of command claims services shall:

    (1) Exercise claims settlement authority as specified in this part, including appellate authority where so delegated.

    (2) Supervise the investigation, processing, and settlement of claims against, and in favor of the United States under the statutes and regulations listed in § 536.2, and pursuant to other appropriate statutes, regulations, and authorizations.

    (3) Designate and grant claims settlement authority to ACOs. A grant of such authority will not be effective until coordinated with the Commander USARCS, and assigned an office code. However, the chief of a command claims service may redesignate a CPO that already has an assigned office code as an ACO without coordination with the Commander USARCS. The Commander USARCS, will be informed of such a designation.

    (4) Designate and grant claims approval authority to CPOs. Only CPOs staffed with a claims judge advocate (CJA) or claims attorney may be granted approval authority. A grant of such authority will not be effective until coordinated with the Commander USARCS, and assigned an office code.

    (5) Train claims personnel and monitor their operations and ongoing claims administration. Conduct a training course annually.

    (6) Implement pertinent claims policies.

    (7) Prepare and publish command claims directives.

    (8) Administer the command claims expenditure allowance, providing necessary data, estimates, and reports to USARCS on a regular basis.

    (9) Perform the responsibilities of an ACO (see § 536.9), as applicable, ensure that SOFA claims are investigated properly and timely filed with the receiving State and adequately funded.

    (10) Serve as the United States “sending State office,” if so designated, when operating in an area covered by a SOFA.

    (11) Supervise and provide technical assistance to subordinate ACOs within the command claims service's geographic area of responsibility.

    (12) Appoint FCCs.

    (b) Operations of Command Claims Services. The SJA of the command shall supervise the command claims service. The command SJA may designate a field grade JA as the chief of the service. An adequate number of qualified claims personnel shall be assigned to ensure that claims are promptly investigated and acted upon. With the concurrence of the Commander USARCS, a command claims service may designate ACOs within its area of operations to carry out claims responsibilities within specified geographic areas subject to agreement by the commander concerned.

    Responsibilities and operations of area claims offices.

    (a) Heads of ACOs. Heads of ACOs, including COE offices (see § 536.3(e)(3)) shall:

    (1) Ensure that claims and potential claims incidents in their area of responsibility are promptly investigated in accordance with this part.

    (2) Ensure that each organization or activity (for example, U.S. Army Reserve (USAR) or Army National Guard of the United States (ARNGUS) unit, ROTC detachment, recruiting company or station, or DOD agency) within the area appoints a claims officer to investigate claims incidents not requiring investigation by a JA (see § 536.23) and ensure that this officer is adequately trained.

    (3) Supervise the investigation, processing, and settlement of claims against, and in favor of, the United States under the statutes and regulations listed in § 536.2 and pursuant to other appropriate statutes, regulations, and authorizations.

    (4) Act as a claims settlement authority on claims that fall within the appropriate monetary jurisdictions set forth in this part and forward claims exceeding such jurisdictions to the Commander USARCS, or to the chief of a command claims service, as appropriate, for action.

    (5) Designate CPOs and request that the Commander USARCS, or the chief of a command claims service, as appropriate, grant claims approval authority to a CPO for claims that fall within the jurisdiction of that office.

    (6) Supervise the operations of CPOs within their area.

    (7) Implement claims policies and guidance furnished by the Commander USARCS.

    (8) Ensure that there are adequate numbers of qualified and adequately trained CJAs or claims attorneys, RCJAs or attorneys, recovery claims clerks, claims examiners, claims adjudicators and claims clerks in all claims offices within their areas to act promptly on claims.

    (9) Budget for and fund claims investigations and activities, such as: Per diem and transportation of claims personnel, claimants and witnesses; independent medical examinations; appraisals and independent expert opinions; long distance telephone calls; recording and photographic equipment; use of express mail or couriers; and other necessary expenses.

    (10) Within the United States and its territories, commonwealths and possessions, procure and disseminate, within their areas of jurisdiction, appropriate legal publications on state or territorial law and precedent relating to tort claims.

    (11) Notify the Commander USARCS, of all claims and potentially compensable events (PCEs) as required by § 536.22(c); notify the chief of a command claims service of all claims and PCEs.

    (12) Develop and maintain written plans for a disaster or civil disturbance. These plans may be internal SJA office plans or an annex to an installation or an agency disaster response plan.

    (13) Implement the Army's Article 139 claims program. (See Subpart I of this part).

    (14) Notify USARCS of possible deployments and ensure adequate FCCs are appointed by USARCS and are trained.

    (b) Operations of Area Claims Offices. (1) The ACO is the principal office for the investigation and adjudication or settlement of claims, and shall be staffed with qualified legal personnel under the supervision of the SJA, command JA, or COE district or command legal counsel.

    (2) In addition to the utilization of unit claims officers required by § 536.10(a), if indicated, the full-time Start Printed Page 46266responsibility for investigating and processing claims arising within or related to the activities of a unit or organization located within a section of the designated area may be delegated to another command, unit, or activity by establishing a CPO at the command, unit, or activity (see § 536.10(b)(4)). Normally, all CPOs will operate under the supervision of the ACO in whose area the CPO is located. Where a proposed CPO is not under the command of the ACO parent organization, this designation may be achieved by a support agreement or memorandum of understanding between the affected commands.

    (3) Normally, claims that cannot be settled by a COE ACO will be forwarded directly to the Commander USARCS, with notice of referral to the Chief Counsel, COE. However, as part of his or her responsibility for litigating suits that involve civil works and military construction activities, the Chief Counsel, COE, may require that a COE ACO forward claims through COE channels, provided that such requirement does not preclude the Commander USARCS from taking final action within the time limitations set forth in subparts D and H of this part.

    Responsibilities and operations of claims processing offices.

    (a) Heads of CPOs. Heads of CPOs will:

    (1) Investigate all potential and actual claims arising within their assigned jurisdiction, on either an area, command, or agency basis. Only a CPO that has approval authority may adjudicate and pay presented claims within its monetary jurisdiction.

    (2) Ensure that units and organizations within their jurisdiction have appointed claims officers for the investigation of claims not requiring a JA's investigation. (See § 536.22).

    (3) Budget for and fund claims investigations and activities; including, per diem and transportation of claims personnel, claimants and witnesses; independent medical examinations; appraisals; independent expert opinions; long distance telephone calls; recording and photographic equipment; use of express mail or couriers; and other necessary expenses.

    (4) Within CONUS, procure and maintain legal publications on local law relating to tort claims pertaining to their jurisdiction.

    (5) Notify the Commander USARCS of all claims and claims incidents, as required by § 536.22 and AR 27-20, paragraph 2-12.

    (6) Implement the Army's Article 139 claims program (see Subpart I of this part).

    (b) Operations of claims processing offices. (1) Claims processing office with approval authority. A CPO that has been granted approval authority must provide for the investigation of all potential and actual claims arising within its assigned jurisdiction, on an area, command, or agency basis, and for the adjudication and payment of all claims presented within its monetary jurisdiction. If the estimated value of a claim, after investigation, exceeds the CPO's payment authority, or if disapproval is the appropriate action, the claim file will be forwarded to the ACO unless otherwise specified in this part, or forwarded to USARCS or the command claims service, if directed by such service.

    (2) Claims processing offices without approval authority. A CPO that has not been granted claims approval authority will provide for the investigation of all potential and actual claims arising within its assigned jurisdiction on an area, command, or agency basis. Once the investigation has been completed, the claim file will be forwarded to the appropriate ACO for action. Alternatively, an ACO may direct the transfer of a claim investigation from a CPO without approval authority to another CPO with approval authority, located within the ACO's jurisdiction.

    (3) Medical claims processing offices. The MCJAs or medical claims attorneys at Army medical centers, other than Walter Reed Army Medical Center, may be designated by the SJA or head of the ACO for the installation on which the center is located as CPOs with approval authority for medical malpractice claims only. Claims for amounts exceeding a medical CPO's approval authority will be investigated and forwarded to the Commander USARCS.

    (4) Special claims processing offices. (i) Designation and authority. The Commander USARCS, the chief of a command claims service, or the head of an ACO may designate special CPOs within his or her command for specific, short-term purposes (for example, maneuvers, civil disturbances and emergencies). These special CPOs may be delegated the approval authority necessary to effect the purpose of their creation, but in no case will this delegation exceed the maximum monetary approval authority set forth in other subparts of this part for regular CPOs. All claims will be processed under the claims expenditure allowance and claims command and office code of the authority that established the office or under a code assigned by USARCS. The existence of any special CPO must be reported to the Commander USARCS, and the chief of a command claims service, as appropriate.

    (ii) Maneuver damage and claims office jurisdiction. A special CPO is the proper organization to process and approve maneuver damage claims, except when a foreign government is responsible for adjudication pursuant to an international agreement (see Subpart G of this part). Personnel from the maneuvering command should be used to investigate claims and, at the ACO's discretion, may be assigned to the special CPO. The ACO will process claims filed after the maneuver terminates. The special CPO will investigate claims arising while units are traveling to or from the maneuver within the jurisdiction of other ACOs, and forward such claims for action to the ACO in whose area the claims arose. Claims for damage to real or personal property arising on private land that the Army has used under a permit may be paid from funds specifically budgeted by the maneuver for such purposes in accordance with AR 405-15.

    (iii) Disaster claims and civil disturbance. A special CPO provided for a disaster or civil disturbance should include a claims approving authority with adequate investigatory, administrative, and logistical support, including damage assessment and finance and accounting support. It will not be dispatched prior to notification of the Commander USARCS, whose concurrence must be obtained before the first claim is paid.

    (5) Supervisory requirements. The CPOs discussed in paragraphs (b)(2) through (b)(4) of this section must be supervised by an assigned CJA or claims attorney in order to exercise delegated approval authority.

    Chief of Engineers.

    The Chief of Engineers, through the Chief Counsel, shall:

    (a) Provide general supervision of the claims activities of COE ACOs.

    (b) Ensure that each COE ACO has a claims attorney designated in accordance with § 536.4.

    (c) Ensure that claims personnel are adequately trained, and monitor their ongoing claims administration.

    (d) Implement pertinent claims policies.

    (e) Provide for sufficient funding in accordance with existing Army regulations and command directives for temporary duty (TDY), long distance telephone calls, recording equipment, cameras, and other expenses for investigating and processing claims. Start Printed Page 46267

    (f) Procure and maintain adequate legal publications on local law relating to claims arising within the United States, its territories, commonwealths and possessions.

    (g) Assist USARCS in evaluation of claims by furnishing qualified expert and technical advice from COE resources, on a non-reimbursable basis except for temporary duty (TDY) and specialized lab services expenses.

    Commanding General, U.S. Army Medical Command.

    (a) After consulting with the Commander USARCS on the selection of medical claims attorneys, the Commander of the U.S. Army MEDCOM, the European Medical Command, or other regional medical command, through his or her SJA/Center Judge Advocate, shall ensure that an adequate number of qualified MCJAs or medical claims attorneys and medical claims investigators are assigned to investigate and process medical malpractice claims arising at Army medical centers under the Commander's control. In accordance with an agreement between TJAG and The Surgeon General, such personnel shall be used primarily to investigate and process medical malpractice claims and affirmative claims and will be provided with the necessary funding and research materials to carry out this function.

    (b) Upon request of a claims judge advocate or claims officer, shall provide a qualified health care provider at a medical treatment facility (MTF) to examine a claimant for his injuries even if the claimant is not otherwise entitled to care at an MTF (See AR 40-400, Patient Administration, paragraph 3-47).

    Chief, National Guard Bureau.

    The Chief, National Guard Bureau (NGB), shall:

    (a) Ensure the designation of a point of contact for claims matters in each State Adjutant General's office.

    (b) Provide the name, address, and telephone number of these points of contact to the Commander USARCS.

    (c) Designate claims officers to investigate claims generated by ARNG personnel and forward investigations to the Active Army ACO that has jurisdiction over the area in which the claims incident occurred.

    Commanders of major Army commands.

    Commanders of MACOMs, through their SJAs, shall:

    (a) Assist USARCS in monitoring ACOs and CPOs under their respective commands for compliance with the responsibilities assigned in §§ 536.9 and 536.10.

    (b) Assist claims personnel in obtaining qualified expert and technical advice from command units and organizations on a nonreimbursable basis (although the requesting office may be required to provide TDY funding).

    (c) Assist TJAG, through the Commander USARCS, in implementing the functions set forth in § 536.7.

    (d) Coordinate with the ACO within whose jurisdiction a maneuver is scheduled, to ensure the prompt investigation and settlement of any claims arising from it.

    Claims policies.

    (a) General. The following policies will be adhered to in processing and adjudicating claims falling within this regulation. The Commander USARCS is authorized to publish new policies or rescind existing policies from time to time as the need arises.

    (1) Notification. The Commander USARCS must be notified as soon as possible of both potential and actual claims which are serious incidents that cannot be settled within the monetary jurisdiction of a Command Claims Service or an ACO, including those which occur in the area of responsibility of a CPO. On such claims, the USARCS Area Action Officer (AAO) must coordinate with the field office as to all aspects of the investigation, evaluation and determination of liability. An offer of settlement or the assertion of an affirmative claim must be the result of a discussion between the AAO and the field office. Payment of a subrogated claim may commit the United States to liability as to larger claims. On the other hand, where all claims out of an incident can be paid within field authority they should be paid promptly with maximum use of small claims procedures.

    (2) Consideration under all subparts. Prior to denial, a claim will be considered under all subparts of this part, regardless of the form on which the claim is presented. A claim presented as a personnel claim will be considered as a tort prior to denial. A claim presented as a tort will first be considered as a personnel claim, and if not payable, then considered as a tort. If deniable, the claim will be denied both as a personnel claim and as a tort.

    (3) Compromise. DA policy seeks to compromise claims in a manner that represents a fair and equitable result to both the claimant and the United States. This policy does not extend to frivolous claims or claims lacking factual or legal merit. A claim should not be settled solely to avoid further processing time and expense. All claims, regardless of amount, should be evaluated. Congress imposed no minimum limit on payable claims nor did it intend that small non-meritous claims be paid. Practically any claim, regardless of amount, may be subject to compromise through direct negotiation. A CJA or claims attorney should develop expertise in assessing liability and damages, including small property damage claims. For example, a property damage claim may be compromised by deducting the cost of collection, i.e., attorney fees and costs, even where liability is certain.

    (4) Expeditious processing at the lowest level. Claims investigation and adjudication should be accomplished at the lowest possible level, such as the CPO or ACO that has monetary authority over the estimated total value of all claims arising from the incident. The expeditious investigation and settlement of claims is essential to successfully fulfilling the Army's responsibilities under the claims statutes implemented by this part.

    (5) Notice to claimants of technical errors in claim. When technical errors are found in a claim's filing or contents, claimants should be advised of such errors and the need to correct the claim. If the errors concern a jurisdictional matter, a record should be maintained and the claimant should be immediately warned that the error must be corrected before the statute of limitations (SOL) expires.

    (b) Cooperative investigative environment. Any person who indicates a desire to file a claim against the United States cognizable under one of the subparts of this part will be instructed concerning the procedure to follow. The claimant will be furnished claim forms and, when necessary, assisted in completing claim forms, and may be assisted in assembling evidence. Claims personnel may not assist any claimant in determining what amount to claim. During claims investigation, every effort should be made to create a cooperative environment that engenders the free exchange of information and evidence. The goal of obtaining sufficient information to make an objective and fair analysis should be paramount. Personal contact with claimants or their representatives is essential both during investigation and before adjudication. When settlement is not feasible, issues in dispute should be clearly identified to facilitate resolution of any reconsideration, appeal or litigation.

    (c) Claims directives and plans. (1) Directives. Two copies of command claims directives will be furnished to Start Printed Page 46268the Commander USARCS. ACO directives will be distributed to all DA and DOD commands, installations and activities within the ACO's area of responsibility, with an information copy to the Commander USARCS.

    (2) Disaster and civil preparedness plan. One copy of all ACOs' disaster or civil disturbance plans or annexes will be furnished to the Commander USARCS.

    (d) Interpretations. The Commander USARCS will publish written interpretations of this part. Interpretations will have the same force and effect as this part.

    (e) Authority to grant exceptions to and deviations from this part. If, in particular instances, it is considered to be in the best interests of the government, the Commander USARCS may authorize deviations from this part's specific requirements, except as to matters based on statutes, treaties and international agreements, executive orders, controlling directives of the Attorney General or Comptroller General, or other publications that have the force and effect of law.

    (f) Guidance. The Commander USARCS, may publish bulletins, manuals, handbooks and notes, and a DA Pamphlet that provides guidance to claims authorities on administrative and procedural rules implementing this part. These will be binding on all Army claims personnel.

    (g) Communication. All claims personnel are authorized to communicate directly with USARCS personnel for guidance on matters of policy or on matters relating to the implementation of this part.

    (h) Private relief bills. The issue of a private relief bill is one between a claimant and his or her Congressional representative. There is no established procedure under which the DA sponsors private relief legislation. Claims personnel shall remain neutral in all private relief matters and shall not make any statement that purports to reflect the DA's position on a private relief bill.

    Release of information policies.

    (a) Conflict of interest. Except as part of their official duties, government personnel are forbidden from advising or representing claimants or from receiving any payment or gratuity for services rendered. They may not accept any share or interest in a claim or assist in its presentation, under penalty of federal criminal law (18 U.S.C. 203 and 205).

    (b) Release of information. (1) Relevant statutes pertinent to the release of information include the Privacy Act of 1974, 5 U.S.C. 552a and 552b, the Freedom of Information Act (FOIA), 5 U.S.C. 552 and the Health Insurance Portability and Accountability Act (HIPAA), 42 U.S.C. 1320d through 1320d-8.

    (2) It is the policy of USARCS that unclassified attorney work product may be released with or without a request from the claimant or attorney, whenever such release may help settle the claim or avoid unnecessary litigation.

    (3) A statutory exemption or privilege may not be waived. Similarly, documents subject to such statutorily required nondisclosure, exemption, or privilege may not be released. Regarding other exemptions and privileges, authorities may waive such exemptions or privileges and direct release of the protected documents, upon balancing all pertinent factors, including finding that release of protected records will not harm the government's interest, will promote settlement of a claim and will avoid unnecessary litigation, or for other good cause.

    (4) All requests for records and information made pursuant to the FOIA, 5 U.S.C. 552, the Privacy Act of 1974, 5 U.S.C. 552a, or HIPAA, 42 U.S.C. 1320d, will be processed in accordance with the procedures set forth in AR 25-55 and AR 340-21, respectively as well as 45 CFR parts 160 and 164, DODD 6025.18-R, this part, and DA Pam 27-162.

    (i) Any request for DOD records that either explicitly or implicitly cites the FOIA shall be processed under the provisions of AR 25-55. Requests for DOD records submitted by a claimant or claimant's attorney will be processed under both the FOIA and under the Privacy Act when the request is made by the subject of the records requested and those records are maintained in a system of records. Such requests will be processed under the FOIA time limits and the Privacy Act fee provisions. Withheld information must be exempt from disclosure under both Acts.

    (ii) Requests that cite both Acts or neither Act are processed under both Acts, using the FOIA time limits and the Privacy Act fee provisions. For further guidance, see AR 25-55, paragraphs 1-301 and 1-503.

    (5) The following records may not be disclosed:

    (i) Medical quality assurance records exempt from disclosure pursuant to 10 U.S.C. 1102(a).

    (ii) Records exempt from disclosure pursuant to appropriate balancing tests under FOIA exemption (6) (clearly unwarranted invasion of personal privacy), exemption (7)(c) (reasonably constitutes unwarranted invasion of privacy), and law enforcement records (5 U.S.C. 552 (b)) unless requested by the subject of the record.

    (iii) Records protected by the Privacy Act.

    (iv) Records exempt from disclosure pursuant to FOIA exemption (1) (National security) (5 U.S.C. 552(b)), unless such records have been properly declassified.

    (v) Records exempt from disclosure pursuant to the attorney-client privilege under FOIA exemption (5) (5 U.S.C. 552(b)), unless the client consents to the disclosure.

    (6) Records within a category for which withholding of the record is discretionary (AR 25-55, paragraph 3-101), such as exemptions under the deliberative process or attorney work product privileges (exemption (5) (5 U.S.C. 552(b)) may be released when there is no foreseeable harm to government interests in the judgment of the releasing authority.

    (7) When it is determined that exempt information should not be released, or a question as to its releaseability exists, forward the request and two copies of the responsive documents to the Commander USARCS. The Commander USARCS, acting on behalf of TJAG (the initial denial authority), may deny release of records processed under the FOIA only. The Commander USARCS, will forward to TJAG all such requests processed under both the FOIA and PA. TJAG is the denial authority for Privacy Act requests (AR 340-21, paragraph 1-7i).

    (c) Claims assistance. In the vicinity of a field exercise, maneuver or disaster, claims personnel may disseminate information on the right to present claims, procedures to be followed, and the names and location of claims officers and the COE repair teams. When the government of a foreign country in which U.S. Armed Forces are stationed has assumed responsibility for the settlement of certain claims against the United States, officials of that country will be furnished as much pertinent information and evidence as security considerations permit.

    Single-service claims responsibility (DODD 5515.8 and DODD 5515.9).

    (a) Assignment for DOD claims. The Army is responsible for processing DOD claims pursuant to DODD 5515.9 (posted on the USARCS Web site; for the address see § 536.2(a)).

    (b) Statutes and agreements. DOD has assigned single-service responsibility for the settlement of certain claims in certain countries, pursuant to DODD 5515.8 (posted on the USARCS Web Start Printed Page 46269site; for the address see § 536.2(a)) under the following statutes and agreements:

    (1) FCA (10 U.S.C. 2734);

    (2) MCA (10 U.S.C. 2733);

    (3) Status of Forces Agreements (10 U.S.C. 2734a and 2734b);

    (4) NATO SOFA (4 U.S.T. 1792, Treaties and International Acts Series (T.I.A.S.) 2846) and other similar agreements;

    (5) FCCA (31 U.S.C. 3711-3720E) and FMCRCA (42 U.S.C. 2651-2653);

    (6) Claims not cognizable under any other provision of law, 10 U.S.C. 2737; and

    (7) Advance payments, 10 U.S.C. 2736.

    (c) Specified foreign countries. Responsibility for the settlement of claims cognizable under the laws listed above has been assigned to military departments pursuant to DODD 5515.8, as supplemented by executive agreement and other competent directives.

    (d) When claims responsibility has not been assigned. When necessary to implement contingency plans, the unified or specified commander with authority over the geographic area in question may, on an interim basis before receiving confirmation and approval from the General Counsel, DOD, assign single-service responsibility for processing claims in countries where such assignment has not already been made.

    Note to § 536.17:

    See also § 536.32 for information on transferring claims among armed services branches.

    Cross-servicing of claims.

    (a) Where claims responsibility has not been assigned. Claims cognizable under the FCA or the MCA that are generated by another military department within a foreign country for which single-service claims responsibility has not been assigned, may be settled by the Army upon request of the military department concerned. Conversely, Army claims may in appropriate cases be referred to another military department for settlement, DODD 5515.8, E1.2 (posted on the USARCS Web site; for the address see § 536.2(a)). Tables listing claims offices worldwide are posted to the USARCS Web site at that address. U.S. Air Force claims offices may be identified by visiting the Web site at http://afmove.hq.af.mil/​page_​afclaims.asp.

    (b) Claims generated by the Coast Guard. Claims resulting from the activities of, or generated by, Coast Guardsmen or civilian employees of the Coast Guard while it is operating as a service of the U.S. Department of Homeland Security may upon request be settled under this part by a foreign claims commission appointed as authorized herein, but they will be paid from Coast Guard appropriations, 10 U.S.C. 2734.

    (c) SOFA claims within the United States. Claims cognizable under the NATO PFP or Singaporean SOFAs arising out of the activities of aircraft within the United States may be investigated and adjudicated by the U.S. Air Force under a delegation from the Commander USARCS. Claims exceeding the delegated amount will be adjudicated by the USARCS.

    (d) Claims generated by the American Battle Monuments Commission. Claims arising out of the activities of or in cemeteries outside the United States managed by the American Battle Monuments Commission (36 U.S.C. 2110) will be investigated and adjudicated by the U.S. Army.

    Note to § 536.18:

    See also § 536.32 for information on transferring claims among armed services branches.

    Disaster claims planning.

    All ACOs will prepare a disaster claims plan and furnish a copy to USARCS. See DA Pam 27-162, paragraph 1-21 for specific requirements related to disaster claims planning.

    Claims assistance visits.

    Members of USARCS and command claims services will make claims assistance visits to field offices on a periodic basis. See DA Pam 27-162, paragraph 1-22 for specific requirements related to claims assistance visits.

    Annual claims award.

    The Commander USARCS will make an annual claims award to outstanding field offices. See DA Pam 27-162, para 1-23 for more information on annual claims awards.

    Subpart B—Investigation and Processing of Claims

    Claims investigative responsibility—general.

    (a) Scope. This subpart addresses the investigation, processing, evaluation, and settlement of tort and tort-related claims for and against the United States. The provisions of this subpart do not apply to personnel claims (AR 27-20, chapter 11), or to claims under subpart G of this part, §§ 536.113 through 536.116.

    (b) Cooperation. Claims investigation requires team effort between the U.S. Army Claims Service (USARCS), command claims services, and area claims offices (ACOs) including U.S. Army Corps of Engineers (COE) District Offices, claims processing offices (CPOs), and unit claims officers. Essential to this effort is the immediate investigation of claims incidents. Prompt investigation depends on the timely reporting of claims incidents as well as continuous communication between all commands or echelons bearing claims responsibility.

    (c) Notification to USARCS. A CPO or an ACO receiving notice of a potentially compensable event (PCE) that requires investigation will immediately refer it to the appropriate claims office. The Commander USARCS will be notified of all major incidents involving serious injury or death or those in which property damage exceeds $50,000. A command claims service may delegate to an ACO the responsibility for advising USARCS of serious incidents and complying with mirror file requirements. A copy of the written delegation and any changes made thereafter will be forwarded to the Commander USARCS.

    (d) Geographic concept of responsibility. A command claims service or an ACO in whose geographic area a claims incident occurs is primarily responsible for initiating investigation and processing of any claim filed in the absence of a formal transfer of responsibility (see §§ 536.30 through 536.36). DOD and Army organizations whose personnel are involved in the incident will cooperate with and assist the ACO, regardless of where the former may be located.

    Note to § 536.22:

    See the parallel discussion at DA Pam 27-162, paragraph 2-1.

    Identifying claims incidents both for and against the government.

    (a) Investigation is required when:

    (1) There is property loss or damage.

    (i) Property other than that belonging to the government is damaged, lost, or destroyed by an act or omission of a government employee or a member of North Atlantic Treaty Association (NATO), Australian or Singaporean forces stationed or on temporary duty within the United States.

    (ii) Property belonging to the government is damaged or lost by a tortious act or omission not covered by the report of survey system or by a carrier's bill of lading.

    (2) There is personal injury or death.

    (i) A civilian other than an employee of the U.S. government is injured or killed by an act or omission of a Start Printed Page 46270government employee or by a member of a NATO, Australian or Singaporean force stationed or on temporary duty within the United States. (This category includes patients injured during treatment by a health care provider).

    (ii) Service members, active or retired, family members of either, or U.S. employees, are injured or killed by a third party and receive medical care at government expense.

    (3) A claim is filed.

    (4) A competent authority or another armed service or federal agency requires investigation.

    (b) Determining who is a government employee is a matter of federal, not local, law. Categories of government employees usually accepted as tortfeasors under federal law are:

    (1) Military personnel (soldiers of the Army, or members of other services where the Army exercises single-service jurisdiction on foreign soil; and soldiers or employees within the United States who are members of NATO or of other foreign military forces with whom the United States has a reciprocal claims agreement and whose sending States have certified that they were acting within the scope of their duty) who are serving on full-time active duty in a pay status, including soldiers:

    (i) Assigned to units performing active or inactive duty.

    (ii) Serving on active duty as Reserve Officer Training Corps (ROTC) instructors.

    (iii) Serving as Army National Guard (ARNG) instructors or advisors.

    (iv) On duty or training with other federal agencies, for example: The National Aeronautics and Space Administration, the Department of State, the Navy, the Air Force, or DOD (federal agencies other than the armed service to which the Soldier is attached may also provide a remedy).

    (v) Assigned as students or ordered into training at a non-federal civilian educational institution, hospital, factory, or other facility (excluding soldiers on excess leave or those for whom the training institution or organization has assumed liability by written agreement).

    (vi) Serving on full-time duty at nonappropriated fund (NAF) activities.

    (vii) Of the United States Army Reserve (USAR) and ARNG on active duty under Title 10, U.S.C.

    (2) Military personnel who are United States Army Reserve soldiers including ROTC cadets who are Army Reserve soldiers while at annual training, during periods of active duty and inactive duty training.

    (3) Military personnel who are soldiers of the ARNG while engaged in training or duty under 32 U.S.C. 316, 502, 503, 504, 505, or engaged in properly authorized community action projects under the Federal Tort Claims Act (FTCA), the Non-Scope Claims Act (NSCA), or the National Guard Claims Act (NGCA), unless performing duties in furtherance of a mission for a state, commonwealth, territory or possession.

    (4) Civilian officials and employees of both the DOD and DA (there is no practical significance to the distinction between the terms “official” and “employee”), including but not limited to the following:

    (i) Civil service and other full-time employees of both the DOD and DA who are paid from appropriated funds.

    (ii) Persons providing direct health care services pursuant to personal service contracts under 10 U.S.C. 1089 or 1091 or where another person exercised control over the health care provider's day-to-day practice. When the conduct of a health care provider performing services under a personal service contract is implicated in a claim, the CJA, Medical Claims Judge Advocate (MCJA), or claims attorney should consult with USARCS to determine if that health care provider can be considered an employee for purposes of coverage.

    (iii) Employees of a NAF instrumentality (NAFI) if it is an instrumentality of the United States and thus a federal agency. To determine whether a NAFI is a “federal agency,” consider both whether it is an integral part of the Army charged with an essential DA operational function and also what degree of control and supervision DA personnel exercise over it. Members or users, unlike employees of NAFIs, are not considered government employees; the same is true of family child care providers. However, claims arising out of the use of some NAFI property or from the acts or omissions of family child care providers may be payable from such funds under subpart K of this part as a matter of policy, even when the user is not acting within the scope of employment and the claim is not otherwise cognizable under any of the other authorities described in this part.

    (5) Prisoners of war and interned enemy aliens.

    (6) Civilian employees of the District of Columbia ARNG, including those paid under “service contracts” from District of Columbia funds.

    (7) Civilians serving as ROTC instructors paid from Federal funds.

    (8) ARNG technicians employed under 32 U.S.C. 709(a) for claims accruing on or after January 1, 1969 (Pub. L. 90-486, August 13, 1968 (82 Stat. 755)), unless performing duties solely in pursuit of a mission for a state, commonwealth, territory or possession.

    (9) Persons acting in an official capacity for the DOD or DA either temporarily or permanently with or without compensation, including but not limited to the following:

    (i) Dollar-a-year personnel.

    (ii) Members of advisory committees, commissions, or boards.

    (iii) Volunteers serving in an official capacity in furtherance of the business of the United States, limited to those categories set forth in DA Pam 27-162, paragraph 2-45.

    Note to § 536.23:

    See the parallel discussion at DA Pam 27-162, paragraph 2-2.

    Delegation of investigative responsibility.

    (a) Area Claims Office. An ACO is authorized to carry out its investigative responsibility as follows:

    (1) At the request of the area claims authority, commanders and heads of Army and DOD units, activities, or components will appoint a commissioned, warrant, or noncommissioned officer or a qualified civilian employee to investigate a claims incident in the manner set forth in DA Pam 27-162 and this part. An ACO will direct such investigation to the extent deemed necessary.

    (2) CPOs are responsible for investigating claims incidents arising out of the activities and operations of their command or agency. An ACO may assign area jurisdiction to a CPO after coordination with the appropriate commander to investigate claims incidents arising in the ACO's designated geographic area. (See § 536.3(f)).

    (3) Claims incidents involving patients arising from treatment by a health care provider in an Army medical treatment facility (MTF), including providers defined in 536.23(b)(4)(ii), will be investigated by a claims judge advocate (CJA), medical claims judge advocate (MCJA), or claims attorney rather than by a unit claims officer.

    (4) An ACO will publish and distribute a claims directive to all DOD and Army installations and activities including active, Army Reserve, and ARNG units as well as units located on the post at which the ACO is located. The directive will outline each installation's and activity's claims responsibilities. It will institute a serious claims incident reporting system.

    (b) Command claims service responsibility. A command claims Start Printed Page 46271service is responsible for the investigation and processing of claims incidents arising in its geographic area of responsibility or for any incidents within the authority of any foreign claims commission (FCC) it appoints. This responsibility will be carried out by an ACO or a CPO to the extent possible. A command claims service will publish a claims directive outlining the geographic areas of claims investigative responsibilities of each of its installations and activities, requiring each ACO or CPO to report all serious claims incidents directly to the Commander USARCS.

    (c) USARCS responsibility. USARCS exercises technical supervision over all claims offices, providing guidance on specific cases throughout the claims process, including the method of investigation. Where indicated, USARCS may investigate a claims incident that normally falls within a command claims service's, an ACO's, or a CPO's jurisdiction. USARCS typically acts through an area action officer (AAO) who is assigned as the primary point of contact with command claims services, ACOs or CPOs within a given geographic area. In areas outside the United States and its commonwealths, territories and possessions, where there is no command claims service or ACO, USARCS is responsible for investigation and for appointment of FCCs.

    Note to § 536.24:

    See the parallel discussion at DA Pam 27-162, paragraph 2-3.

    Procedures for accepting claims.

    All ACOs and CPOs will institute procedures to ensure that potential claimants or attorneys speak to a CJA, claims attorney, investigator, or examiner. On initial contact, claims personnel will render assistance, discuss all aspects of the potential claim, and determine what statutes or procedures apply. Assistance will be furnished to the extent set forth in DA Pam 27-162, paragraph 2-4. To advise claimants on the correct remedy, claims personnel will familiarize themselves with the remedies listed in DA Pam 27-162, paragraphs 2-15 and 2-17.

    Identification of a proper claim.

    (a) A claim is a writing that contains a sum certain for each claimant and that is signed by each claimant, or by an authorized representative, who must furnish written authority to sign on a claimant's behalf. The writing must contain enough information to permit investigation. The writing must be received not later than two years from the date the claim accrues. A claim under the Foreign Claims Act (FCA) may be presented orally to either the United States or the government of the foreign country in which the incident occurred, within two years, provided that it is reduced to writing not later than three years from the date of accrual. A claim may be transmitted by facsimile or telegram. However, a copy of an original claim must be submitted as soon as possible.

    (b) Where a claim is only for property damage and it is filed under circumstances where there might be injuries, the CJA should inquire if the claimant desires to split the claim as discussed in § 536.60.

    (c) Normally, a claim will be presented on a Standard Form (SF) 95 (Claim for Damage, Injury, or Death). When the claim is not presented on an SF 95, the claimant will be requested to complete an SF 95 to ease investigation and processing.

    (d) If a claim names two claimants and states only one sum certain, the claimants will be requested to furnish a sum certain for each. A separate sum certain must be obtained prior to payment under the Federal Tort Claims Act (FTCA), Military Claims Act (MCA), National Guard Claims Act (NGCA) or the FCA. The Financial Management Service will only pay an amount above the threshold amount of $2,500 for the FTCA, or $100,000 for the other statutes.

    (e) A properly filed claim meeting the definition of “claim” in paragraph (a) of this section tolls the two-year statute of limitations (SOL) even though the documents required to substantiate the claim are not present, such as those listed on the back of an SF 95 or in the Attorney General's regulations implementing the FTCA, 28 CFR 14.1-14.11. However, refusal to provide such documents may lead to dismissal of a subsequent suit under the FTCA or denial of a claim under other subparts of this part.

    (f) Receipt of a claim by another federal agency does not toll the SOL. Receipt of a U.S. Army claim by DOD, Navy, or Air Force does toll the SOL.

    (g) The guidelines set forth in federal FTCA case law will apply to other subparts of this part in determining whether a proper claim was filed.

    Note to § 536.26:

    See the parallel discussion at DA Pam 27-162, paragraph 2-5.

    Identification of a proper claimant.

    The following are proper claimants:

    (a) Claims for property loss or damage. A claim may be presented by the owner of the property or by a duly authorized agent or legal representative in the owner's name. As used in this part, the term “owner” includes the following:

    (1) For real property. The mortgagor, mortgagee, executor, administrator, or personal representative, if he or she may maintain a cause of action in the local courts involving a tort to the specific property, is a proper claimant. When notice of divided interests in real property is received, the claim should if feasible be treated as a single claim and a release from all interests must be obtained. This includes both the owner and tenant where both claim.

    (2) For personal property. A claim may be presented by a bailee, lessee, mortgagee, conditional vendor, or others holding title for purposes of security only, unless specifically prohibited by the applicable subpart. When notice of divided interests in personal property is received, the claim should if feasible be treated as a single claim; a release from all interests must be obtained. Property loss is defined as loss of actual tangible property, not consequential damage resulting from such loss.

    (b) Claims for personal injury or wrongful death. (1) For personal injury. A claim may be presented by the injured person or by a duly authorized agent or legal representative or, where the claimant is a minor, by a parent or a person in loco parentis. However, determine whether the claimant is a proper claimant under applicable state law or, if considered under the MCA, under § 536.77. If not, the claimant should be so informed in the acknowledgment letter and requested to withdraw the claim. If not withdrawn, deny the claim without delay. An example is a claim filed on behalf of a minor for loss of consortium for injury to a parent where not permitted by state law. Personal injury claims deriving from the principal injury may be presented by other parties. A claim may not be presented by a “volunteer,” meaning one who has no legal or contractual obligation, yet voluntarily pays damages on behalf of an injured party and then seeks reimbursement for their economic damages by filing a claim. See paragraph (f)(3) of this section.

    (2) For wrongful death. A claim may be presented by the executor or administrator of the deceased's estate, or by any person determined to be legally or beneficially entitled under applicable local law. The amount allowed will be apportioned, to the extent practicable, among the beneficiaries in accordance with the law applicable to the incident. Under the MCA (subpart C of this part), only one wrongful death claim is authorized (see § 536.77(c)(1)(i)). Under Start Printed Page 46272subparts D and H of this part, a claim by the insured for property damage may be considered as a claim by the insurer as the real party in interest provided the insured has been reimbursed by the insurer and the insurance information is listed on the SF 95. The insurer should be required to file a separate SF 95 for payment purposes even though the SOL has expired. Where the insurance information is not listed on the SF 95 and the insured is paid by the United States, the payment of the insurer is the responsibility of the insured even though the insurer subsequently files a timely claim. To avoid this situation, always inquire as to the status of any insurance prior to payment of a property damage claim.

    (c) By an agent or legal representative. A claimant's agent or legal representative who presents a claim will do so in the claimant's name and sign the form in such a way that indicates the agent's or legal representative's title or capacity. When a claim is presented by an agent or legal representative:

    (1) It must contain written evidence of the agent's or legal representative's authority to sign, such as a power of attorney, or

    (2) It must refer to or cite the statute granting authority.

    (d) Subrogation. A claim may be presented by the subrogee in his or her own name if authorized by the law of the place where the incident giving rise to the claim occurred, under subpart D or H of this part only. A lienholder is not a proper claimant and should be distinguished from a subrogee to avoid violation of the Antiassignment Act. See paragraph (f) of this section. However, liens arising under Medicare will be processed directly with the Center for Medicare and Medicaid Systems. See DA Pam 27-162, paragraphs 2-57g and h and 2-58.

    (e) Contribution or indemnity. A claim may be filed for contribution or indemnification by the party who was held liable as a joint tortfeasor where authorized by state law. Such a claim is not perfected until payment has been made by the claimant/joint tortfeasor. A claim filed for contribution prior to payment being made should be considered as an opportunity to share a settlement where the United States is liable.

    (f) Transfer or assignment. (1) Under the Antiassignment Act (31 U.S.C. 3727) and Defense Finance and Accounting Service—Indianapolis (DFAS-IN) regulation 37-1, a transfer or assignment is null and void except where it occurs by operation of law or after a voucher for the payment has been issued. The following are null and void:

    (i) Every purported transfer or assignment of a claim against the United States, or any interest, in whole or in part, on a claim, whether absolute or conditional; and

    (ii) Every power of attorney or other purported authority to receive payment for all or part of any such claim.

    (2) The Antiassignment Act was enacted to eliminate multiple payment of claims, to cause the United States to deal only with original parties and to prevent persons of influence from purchasing claims against the United States.

    (3) In general, this statute prohibits voluntary assignments of claims, with the exception of transfers or assignments made by operation of law. The operation of law exception has been held to apply to claims passing to assignees because of bankruptcy proceedings, assignments for the benefit of creditors, corporate liquidations, consolidations, or reorganizations, and where title passes by operation of law to heirs or legatees. Subrogated claims that arise under a statute are not barred by the Antiassignment Act. For example, subrogated workers' compensation claims are cognizable when presented by the insurer under subpart D or H of this part, but not other subparts.

    (4) Subrogated claims that arise pursuant to contractual provisions may be paid to the subrogee, if the legal basis for the subrogated claim is recognized by state statute or case law, only under subpart D or H of this part. For example, an insurer that issues an insurance policy becomes subrogated to the rights of a claimant who receives payment of a property damage claim. Generally, such subrogated claims are authorized by state law and are therefore not barred by the Antiassignment Act.

    (5) Before claims are paid, it is necessary to determine whether there may be a valid subrogated claim under a federal or state statute or a subrogation contract held valid by state law.

    (g) Interdepartmental waiver rule. Neither the U.S. government nor any of its instrumentalities are proper claimants due to the interdepartmental waiver rule. This rule bars claims by any organization or activity of the Army, whether or not the organization or activity is funded with appropriated or nonappropriated funds. Certain federal agencies are authorized by statute to file claims, for example, Medicare and the Railroad Retirement Commission. See DA Pam 27-162, paragraph 2-17f.

    (h) States are excluded. If a state, U.S. commonwealth, territory, or the District of Columbia maintains a unit to which ARNG personnel causing the injury or damage are assigned, such governmental entity is not a proper claimant for loss or damage to its property. A unit of local government other than a state, commonwealth, or territory is a proper claimant.

    Note to § 536.27:

    See the parallel discussion at DA Pam 27-162, paragraph 2-6.

    Claims acknowledgment.

    Claims personnel will acknowledge all claims immediately upon receipt, in writing, by telephone, or in person. A defective claim will be acknowledged in writing, pointing out its defects. Where the defects render the submission jurisdictionally deficient based on the requirements discussed in DA Pam 27-162, paragraphs 2-5 and 2-6, the claimant or attorney will be informed in writing of the need to present a proper claim no later than two years from the date of accrual. Suit must be filed in maritime claims not later than two years from the date of accrual. See § 536.122. In any claim for personal injury or wrongful death, an authorization signed by the patient, natural or legal guardian or estate representative will be obtained authorizing the use of medical information, including medical records, in order to use sources other than claims personnel to evaluate the claim as required by the Health Care Portability and Accountability Act (HIPAA), 42 U.S.C. 1320d-1320d-8. See the parallel discussion at DA Pam 27-162, paragraph 2-7.

    Revision of filed claims.

    (a) General. A revision or change of a previously filed claim may constitute an amendment or a new claim. Upon receipt, the CJA must determine whether a new claim has been filed. If so, the claim must be logged with a new number and acknowledged in accordance with § 536.27.

    (b) New claim. A new claim is filed whenever the writing alleges a new theory of liability, a new tortfeasor, a new party claimant, a different date or location for the claims incident, or other basic element that constitutes an allegation of a different tort not originally alleged. If the allegation is made verbally or by e-mail, the claimant will be informed in writing that a new SF 95 must be filed. A new claim must be filed not later than two years from the accrual date under the FTCA. Filing a new claim creates an additional six month period during which suit may not be filed.

    (c) Amendment. An increase or decrease in the amount claimed constitutes an amendment, not a new claim. Similarly, the addition of Start Printed Page 46273required information not on the original claim constitutes an amendment. Examples are date of birth, marital status, military status, names of witnesses, claimant's address, description, or location of property or insurance information. An amendment may be filed before or after the two year SOL has run unless final action has been taken. A new number will not be assigned to an amended claim; however, a change in the amount will be annotated in the database.

    Note to § 536.29:

    See the parallel discussion at DA Pam 27-162, paragraph 2-8.

    Action upon receipt of claim.

    (a) A properly filed claim stops the running of the SOL when it is received by any organization or activity of the DOD or the U.S. Armed Services. Placing a claim in the mail does not constitute filing. The first Army claims office that receives the claim will date, time stamp, and initial the claim as of the date the claim was initially received “on post,” not by the claims office. If initially received close to the SOL's expiration date by an organization or activity that does not have a claims office, claims personnel will discover and record in the file the date of original receipt.

    (b) The ACO or CPO that first receives the claim will enter the claim into the Tort and Special Claims Application (TSCA) database and let the system assign a number to the claim. The claim, whether on an SF 95 or in any other format, shall be scanned into a computer and uploaded onto the TSCA database so that it will become a permanent part of the electronic record. A joint claim will be given a number for each claimant, for example, husband and wife, injured parent and children. If only one sum is filed for all claimants, the same sum will be assigned for each claimant. However, request the claimant to name a sum for each claimant. The claim will bear this number throughout the claims process. Upon transfer, a new number will not be assigned by the receiving office. If a claim does not meet the definition of a proper claim under §§ 536.26 and 536.27, it will be date stamped and logged as a Potentially Compensable Event (PCE).

    (c) The claim will be transferred if the claim incident arose in another ACO's geographic area; the receiving ACO will use the claims number originally assigned.

    (d) Non-Appropriated Fund Instrumentality (NAFI) claims that relate to claims determined cognizable under subpart K of this part will be marked with the symbol “NAFI” immediately following the claimant's name, to preclude erroneous payment from appropriated funds (APF). This symbol will also be included in the subject line of all correspondence.

    (e) Upon receipt, copies of the claims will be furnished as follows (when a current e-mail address is available and it is agreeable with the receiving party, providing copies by e-mail is acceptable):

    (1) To USARCS, if the amount claimed exceeds $25,000, or $50,000 per incident. However, if the claim arises under the FTCA or AMCSA, only furnish copies if the amount claimed exceeds $50,000, or $100,000 per incident.

    (2) For medical malpractice claims, to the appropriate MTF Commander/s through MEDCOM Headquarters, and to the Armed Forces Institute of Pathology at the addresses listed below.

    MEDCOM, ATTN: MCHO-CL-Q, 2050 Worth Road, Suite 26, Fort Sam Houston, Texas 78234-5026.

    Department of Legal Medicine, Armed Forces Institute of Pathology, 1335 E. West Highway, #6-100, Silver Spring, MD 20910-6254, Commercial: 301-295-8115, E-Mail: casha@afip.osd.mil.

    (3) If the claim is against AAFES forward a copy to: HQ Army and Air Force Exchange Service (AAFES), ATTN: Office of the General Counsel (GC-Z), P.O. Box 650062, Dallas, TX 75265-0062, E-Mail: blanchp@aafes.com.

    (4) If the claim involves a NAFI, including a recreational user or family child care provider forward a copy to: Army Central Insurance Fund, ATTN: CFSC-FM-I, 4700 King Street, Alexandria, VA 22302-4406, E-Mail: riskmanagement@cfsc.army.mil.

    (f) ACOs or CPOs will furnish a copy of any medical or dental malpractice claim to the MTF or dental treatment facility commander and advise the commander of all subsequent actions. The commander will be assisted in his or her responsibility to complete DD Form 2526 (Case Abstract for Malpractice Claims).

    Note to § 536.30:

    See the parallel discussion at DA Pam 27-162, paragraph 2-9.

    Opening claim files.

    A claim file will be opened when:

    (a) Information that requires investigation under § 536.23 is received.

    (b) Records or other documents are requested by a potential claimant or legal representative.

    (c) A claim is filed.

    Note to § 536.31:

    See the parallel discussion at DA Pam 27-162, paragraph 2-10.

    Transfer of claims among armed services branches.

    (a) Claims filed with the wrong federal agency, or claims that should be adjudicated by receiving State offices under NATO or other SOFA, will be immediately transferred to the proper agency together with notice of same to the claimant or legal representative. Where multiple federal agencies are involved, other agencies will be contacted and a lead agency established to take all actions on the claim. Where the DA is the lead agency, any final action will include other agencies. Similarly, where another agency is the lead agency, that agency will be requested to include DA in any final action. Such inclusion will prevent multiple dates for filing suit or appeal.

    (b) If another agency has taken denial action on a claim that involves the DA, without informing the DA, and in which the DA desires to make a payment, the denial action may be reconsidered by the DA not later than six months from the date of mailing and payment made thereafter.

    Note to § 536.32:

    See also §§ 536.17 and 536.18; AR 27-20, paragraph 13-2; and the parallel and related discussion of this topic at DA Pam 27-162, paragraphs 1-19, 1-20, 2-13 and 13-2.

    Use of small claims procedures.

    Small claims procedures are authorized for use whenever a claim may be settled for $5,000 or less. These procedures are designed to save processing time and eliminate the need for most of the documentation otherwise required. These procedures are described in DA Pam 27-162, paragraphs 2-14 and 2-26.

    Determination of correct statute.

    (a) Consideration under more than one statute. When Congress enacted the various claims statutes, it intended to allow federal agencies to settle meritorious claims. A claim must be considered under other statutes in this part unless one particular statute precludes the use of other statutes, whether the claim is filed on DD Form 1842 (Claim for Loss of or Damage to Personal Property Incident to Service) or SF 95. Prior to denial of an AR 27-20, chapter 11 claim, consider whether it may fall within the scope of subparts C, D, or F of this part, and where indicated, question the claimant to determine whether the claim sounds in tort.

    (b) Exclusiveness of certain remedies. Certain remedies exclude all others. For Start Printed Page 46274example, the Court of Federal Claims has exclusive jurisdiction over U.S. Constitution Fifth Amendment takings, express or implied-in-fact, as well as governmental contract losses, or intangible property losses. Claims of this nature for $10,000 or less may be filed in a U.S. District Court. There is no administrative remedy. While the FTCA is the preemptive tort remedy in the United States, its commonwealths, territories and possessions, nevertheless, other remedies must be exhausted prior to favorable consideration under the FTCA. The FTCA does not preclude use of the MCA or the NGCA for claims arising out of noncombat activities or brought by soldiers for incident-to-service property losses sustained within the United States. See DA Pam 27-162, paragraphs 2-15a and b for a more detailed discussion of determining the correct statute for property claims versus personal injury and death claims. In addition, it is important to consider the nature of the claim, e.g., whether the claim may be medical malpractice in nature, related to postal matter, or an automobile accident. Discussions of these and many other different types of claims are also provided herein as well as in the corresponding paragraph 2-15 of DA Pam 27-162. It is also very important to consider when a claim may fall outside the jurisdiction of the Army claims system. Some of these instances are alluded to immediately above, but for a detailed discussion of related remedies see § 536.36 of this part and paragraph 2-17 of DA Pam 27-162.

    (c) Status of Forces Agreement Claims. (1) Claims arising out of the performance of official duties in a foreign country where the United States is the sending State must be filed and processed under a SOFA, provided that the claimant is a proper party claimant under the SOFA. DA Pam 27-162, paragraph 2-15c sets forth the rules applicable in particular countries. A SOFA provides an exclusive remedy subject to waiver as set forth in § 536.76(h) of this part.

    (2) Single-service jurisdiction is established for all foreign countries in which a SOFA is in effect and for certain other countries. A list of these countries is posted on the USARCS Web site; for the address see § 536.2(a). Claims will be processed by the service exercising single-service responsibility. In the United States, USARCS is the receiving State office and all SOFA claims should be forwarded immediately to USARCS for action. Appropriate investigation under subpart B of this part procedures is required of an ACO or a CPO under USARCS' direction.

    (d) Foreign Claims Act claims. (1) Claims by foreign inhabitants, arising in a foreign country, which are not cognizable under a SOFA, fall exclusively under the FCA. The determination as to whether a claimant is a foreign inhabitant is governed by the rules set out in subpart C and subpart J of this part. In case of doubt, this determination must be based on information obtained from the claimant and others, particularly where the claimant is a former U.S. service member or a U.S. citizen residing in a foreign country.

    (2) Tort claims will be processed by the armed service that exercises single-service responsibility. When requested, the Commander USARCS may furnish a Judge Advocate or civilian attorney to serve as a Foreign Claims Commission (FCC) for another service. With the concurrence of the Commander USARCS, Army JAs may be appointed as members of another department's foreign claims commissions. See Subpart J of this part. The FCA permits compensation for damages caused by “out-of-scope” tortious conduct of Soldier and civilian employees. Many of these claims are also compensable under Article 139, Uniform Code of Military Justice. See DA Pam 27-162, chap. 9. To avoid the double payment of claims, ACOs and CPOs must promptly notify the Command Claims Service of each approved Article 139 claim involving a claimant who could also file under an applicable SOFA.

    (e) National Guard Claims Act claims. (1) Claims attributed to the acts or omissions of ARNG personnel in the course of employment fall into the categories set forth in subpart F of this part.

    (2) An ACO will establish with a state claims office routine procedures for the disposition of claims, designed to ensure that the United States and state authorities do not issue conflicting instructions for processing claims. The procedures will require personnel to advise the claimant of any remedy against the state or its insurer.

    (i) Where the claim arises out of the act or omission of a member of the ARNG or a person employed under 32 U.S.C. 709, it must be determined whether the employee is acting on behalf of the state or the United States. For example, an ARNG pilot employed under section 709 may be flying on a state mission, federal mission, or both, on the same trip. This determination will control the disposition of the claim. If agreement with the concerned state cannot be reached and the claim is otherwise payable, efforts may be made to enter into a sharing agreement with the state concerned. The following procedures are required in the event there is a remedy against the state and the state refuses to pay or the state maintains insurance coverage and the claimant has filed an administrative claim against the United States. First, forward the file and the tort claim memorandum, including information on the status of any judicial or administrative action the claimant has taken against the state or its insurer to the Commander USARCS. Upon receipt, the Commander USARCS will determine whether to require the claimant to exhaust his or her remedy against the state or its insurer or whether the claim against the United States can be settled without requiring such exhaustion. If the Commander USARCS decides to follow the latter course of action, he or she will also determine whether to obtain an assignment of the claim against the state or its insurer and whether to initiate recovery action to obtain contribution or indemnification. The state or its insurer will be given appropriate notification in accordance with state law.

    (ii) If an administrative claim remedy exists under state law or the state maintains liability insurance, the Commander USARCS or an ACO acting upon the Commander USARCS' approval may enter into a sharing agreement covering payment of future claims. The purpose of such an agreement is to determine in advance whether the state or the DA is responsible for processing a claim (did the claim arise from a federal or state mission?), to expedite payment in meritorious claims, and to preclude double recovery by a claimant.

    (f) Third-party claims involving an independent contractor.

    (1) Generally. (i) Upon receipt, all claims will be examined to determine whether a contractor of the United States is the tortfeasor. If so, the claimant or legal representative will be notified of the name and address of the contractor and further advised that the United States is not responsible for the acts or omissions of an independent contractor. This will be done prior to any determination as to the contractor's degree of culpability as compared to that of the United States.

    (ii) If, upon investigation, the damage is considered to be primarily due to the contractor's fault or negligence, the claim will be referred to the contractor or the contractor's insurance carrier for settlement and the claimant will be so advised. Start Printed Page 46275

    (iii) Health care providers hired under personal services contracts under the provisions of 10 U.S.C. 1089 are not considered to be independent contractors but employees of the United States for tort claims purposes.

    (2) Claims for injury or death of contractor employees. Upon receipt of a claim for injury or death of a contractor employee, a copy of the portions of the contract applicable to claims and workers' compensation will be obtained, either through the contracting office or from the contractor. Claims personnel must find out the status of any claim for workers' compensation benefits as well as whether the United States paid the premiums. The goal is to involve the contractor in any settlement, where indicated, in the manner set forth in DA Pam 27-162, paragraphs 2-15f and 2-61. In claims arising in foreign countries consider whether the claim is covered by the Defense Bases Act, 42 U.S.C. 1651-1654.

    (g) Claims by contractors for damage to or loss of their property during the performance of their contracts. Claims by contractors for property damage or loss should be referred to the contracting officer for determination as to whether the claim is payable under the contract. Such a claim is not payable under the FTCA where the damage results from an in-scope act or omission. Contract appeal procedures must be exhausted prior to consideration as a bailment under the MCA or FCA.

    (h) Maritime claims. Maritime torts are excluded from consideration under the FTCA. The various maritime statutes are exclusive remedies within the United States and its territorial waters. Maritime statutes include the Army Maritime Claims Settlement Act (AMCSA), 10 U.S.C. 4801, 4802 and 4806, the Suits in Admiralty Act (SIAA), 46 U.S.C. app. 781-790, the Public Vessels Act (PVA), 46 U.S.C. app. 781-790, and the Admiralty Extension Act (AEA), 46 U.S.C. app. 740. Within the U.S. and its territorial waters, maritime suits may be filed under the SIAA or the PVA without first filing an administrative claim, except where administrative filing is required by the AEA. Administrative claims may also be filed under the AMSCA. In any administrative claim brought under the AMCSA, all action must be completed not later than two years from its accrual date or the SOL will expire. Outside the United States, a maritime tort may be brought under the MCA or FCA as well as the AMCSA. The body of water on which it occurs must be navigable and a maritime nexus must exist. Once a maritime claim is identified, give the claimant written notice of the two-year filing requirement. In case of doubt, the ACO or CPO should discuss the matter with the appropriate AAO. Even when the claimant does not believe that a maritime claim is involved, provide the claimant with precautionary notice. See DA Pam 27-162, paragraphs 2-7e and 8-6.

    (i) Postal claims. See also DA Pam 27-162, paragraphs 2-15i, 2-30 and 2-56g discussing postal claims.

    (1) Claims by the U.S. Postal Service for funds and stock are adjudicated by USARCS with assistance from the Military Postal Service Agency and the ACO or CPO having jurisdiction over the particular Army post office, when directed by USARCS to assist in the investigation of the claim.

    (2) Claims for loss of registered and insured mail are processed under subpart C of this part by the ACO or CPO having jurisdiction over the particular Army post office.

    (3) Claims for loss of, or damage to, parcels delivered by United Parcel Service (UPS) are the responsibility of UPS.

    (j) Blast damage claims. After completing an investigation and prior to final action, all blast damage claims resulting from Army firing and demolition activities must be forwarded to the Commander USARCS for technical review. The sole exception to this rule is when a similar claim is filed citing the same time, place and type of damage as one which has already received technical review. See also DA Pam 27-162, paragraph 2-28.

    (k) Motor vehicle damage claims arising from the use of non-governmental vehicles. See also § 536.60 (splitting property damage and personal injury claims) and DA Pam 27-162, paragraphs 2-15k (determining the correct statute), 2-61 (joint tortfeasors), and 2-62e (indemnity or contribution).

    (1) Government tortfeasors. A Soldier or U.S. government civilian employee who negligently damages his or her personal property while acting within the scope of employment is not a proper claimant for damage to that property.

    (2) Claims by lessors for damage to rental vehicles. Third-party claims arising from the use of rental vehicles will be processed in the same manner as NAFI commercially insured activities after exhaustion of any other remedy under the Government Travel Card Program or the Surface Deployment and Distribution Command Car Rental Agreement.

    (3) Third-party damages arising from the use of privately owned vehicles. Third-party tort claims arising within the United States from a Soldier's use of a privately owned vehicle (POV) while allegedly within the scope of employment must be forwarded to the Commander USARCS for review and consultation before final action. The claim will be investigated and any authorization for use ascertained including payment for mileage. A copy of the Soldier's POV insurance policy will be obtained prior to forwarding. If the DA is an additional insurer under applicable state law, the claim will be forwarded to the Soldier's liability carrier for payment. When the tort claim arises in a foreign country, follow the provisions of Subpart J of this part.

    (l) Claims arising from gratuitous use of DOD or Army vehicles, equipment or facilities. (1) Before the commencement of any event that involves the use of DOD or Army land, vehicles, equipment or Army personnel for community activities, the Command involved should be advised to first determine and weigh the risk to potential third-party claimants against the benefits to the DOD or the Army. Where such risk is excessive, try to obtain an agreement from the sponsoring civilian organization holding the Army harmless. When feasible, third-party liability insurance may be required from the sponsor and the United States added to the policy as a third-party insured.

    (2) When Army equipment and personnel are used for debris removal relief pursuant to the Federal Disaster Relief Act, 42 U.S.C. 5173, the state is required to assume responsibility for third-party claims. The senior judge advocate for a task force engaged in such relief should obtain an agreement requiring the state to hold the Army harmless and establish a procedure for payment by the state. Claims will be received, entered into the TSCA database, investigated and forwarded to state authorities for action.

    (m) Real estate claims. Claims for rent, damage, or other payments involving the acquisition, use, possession or disposition of real property or interests therein, are generally payable under AR 405-15. These claims are handled by the Real Estate Claims Office in the appropriate COE District or a special office created for a deployment. Directorate of Real Estate, Office of the Chief of Engineers, has supervisory authority. Claims for damage to real property and incidental personal property, but not for rent (for example, claims arising during a maneuver or deployment) may be payable under subparts C or J of this part. However, priority should be given to the use of AR 405-15 as it is more flexible and expeditious. In contingency operations and deployments, there is a large potential for overlap between Start Printed Page 46276contractual property damage claims and noncombat activity/maneuver claims. Investigate carefully to ensure the claim is in the proper channel (claims or real estate), that it is fairly settled, and that the claimant does not receive a double payment. For additional guidance, see subpart J of this part and United States Army Claims Service Europe (USACSEUR) Real Estate/Office of the Judge Advocate Standard Operating Procedures for Processing Claims Involving Real Estate During Contingency Operations (August 20, 2002).

    (n) Claims generated by civil works projects. Civil works projects claims arising from tortious activities are defined by whether the negligent or wrongful act or omission arising from a project or activity is funded by a civil works appropriation. Civil works claims are those noncontractual claims which arise from a negligent or wrongful act or omission during the performance of a project or activity funded by civil works appropriations as distinguished from a project or activity funded by Army operation and maintenance funds. Civil works claims are paid out of civil works appropriations to the extent set forth in § 536.71(f). A civil works claim can also arise out of a noncombat activity, for example, an inverse condemnation claim in which flooding exceeds the high water mark. Maritime claims under subpart H of this part are civil works claims when they arise out of the operation of a dam, locks or navigational aid.

    Note to § 536.34:

    See parallel discussion at DA Pam 27-162, paragraph 2-1.

    Unique issues related to environmental claims.

    Claims for property damage, personal injury, or death arising in the United States based on contamination by toxic substances found in the air or the ground must be reported by USARCS to the Environmental Law Division of the Army Litigation Center and the Environmental Torts Branch of DOJ. Such claims arising overseas must be reported to the Command Claims Service with geographical jurisdiction over the claim and USARCS. Claims for personal injury from contamination frequently arise at an area that is the subject of claims for cleanup of the contamination site. The cleanup claims involve other Army agencies, use of separate funds, and prolonged investigation. Administrative settlement is not usually feasible because settlement of property damage claims must cover all damages, including personal injury. Payment by Defense Environmental Rehabilitation Funds should be considered initially and any such payment should be deducted from any settlement under AR 27-20.

    Related remedies.

    An ACO or a CPO routinely receives claims or inquiries about claims that clearly are not cognizable under this part. It is the DA's policy that every effort be made to discover another remedy and inform the inquirer as to its nature. Claims personnel will familiarize themselves with the remedies set forth in DA Pam 27-162, paragraph 2-17, to carry out this policy. If no appropriate remedy can be discovered, forward the file to the Commander USARCS, with recommendations.

    Importance of the claims investigation.

    Prompt and thorough investigation will be conducted on all potential and actual claims for and against the government. Evidence developed during an investigation provides the basis for every subsequent step in the administrative settlement of a claim or in the pursuit of a lawsuit. Claims personnel must gather and record adverse as well as favorable information. The CJA, claims attorney or unit claims officer must preserve their legal and factual findings.

    Elements of the investigation.

    (a) The investigation is conducted to ascertain the facts of an incident. Which facts are relevant often depends on the law and regulations applicable to the conduct of the parties involved but generally the investigation should develop definitive answers to such questions as “When?” “Where?” “Who?” “What?” and “How?”. Typically, the time, place, persons, and circumstances involved in an incident may be established by a simple report, but its cause and the resulting damage may require extensive effort to obtain all the pertinent facts.

    (b) The object of the investigation is to gather, with the least possible delay, the best available evidence without accumulating excessive evidence concerning any particular fact. The claimant is often an excellent source of such information and should be contacted early in the investigation, particularly when there is a question as to whether the claim was timely filed.

    Use of experts, consultants and appraisers.

    (a) ACOs or CPOs will budget operation and maintenance (O&M) funds for the costs of hiring property appraisers, accident reconstructionists, expert consultants to furnish opinions, and medical specialists to conduct independent medical examinations (IMEs). Other expenses to be provided for from O&M funds include the purchase of documents, such as medical records, and the hiring of mediators. See § 536.53(b). Where the cost exceeds $750 or local funds are exhausted, a request for funding should be directed to the Commander USARCS, with appropriate justification. The USARCS AAO must be notified as soon as possible when an accident reconstruction is indicated.

    (b) Where the claim arises from treatment at an Army MTF, the MEDDAC commander should be requested to fund the cost of an independent consultant's opinion or an IME.

    (c) The use of outside consultants and appraisers should be limited to claims in which liability or damages cannot be determined otherwise and in which the use of such sources is economically feasible, for instance, where property damage is high in amount and not determinable by a government appraiser or where the extent of personal injury is serious and a government IME is neither available nor acceptable to a claimant. Prior to such an examination at an MTF, ensure that the necessary specialists are available and a prompt written report may be obtained.

    (d) Either an IME or an expert opinion is procured by means of a personal services contract under the Federal Acquisition Regulation (FAR), part 37, 48 CFR 37.000 through 37.604, through the local contracting office. The contract must be in effect prior to commencement of the records review. Payment is authorized only upon receipt of a written report responsive to the questions asked by the CJA or claims attorney.

    (e) Whenever a source other than claims personnel is used to assist in the evaluation of a claim in which medical information protected by HIPAA is involved, the source must sign an agreement designed to protect the patient's privacy rights.

    Conducting the investigation.

    (a) The methods and techniques for investigating specific categories of claims are set forth in DA Pam 27-162, paragraphs 2-25 through 2-34. The investigation of medical malpractice claims should be conducted by a CJA or claims attorney, using a medical claims investigator.

    (b) A properly filed claim must contain enough information to permit investigation. For example, if the claim does not specify the date, location or Start Printed Page 46277details of every incident complained of, the claimant or legal representative should be required to furnish the information.

    (c) Request the claimant or legal representative to specify a theory of liability. However, the investigation should not be limited to the theories specified, particularly where the claimant is unrepresented. All logical theories should be investigated.

    Determination of liability—generally.

    (a) Under the FTCA, the United States is liable in the same manner and to the same extent as a private individual under like circumstances in accordance with the law of the place where the act or omission giving rise to the tort occurred (28 U.S.C. 2673 and 2674). This means that liability must rest on the existence of a tort cognizable under state law, hereinafter referred to as a state tort. A finding of state tort liability requires the litigating attorney to prove the elements of duty, breach of duty, causation, and damages as interpreted by federal case law.

    (b) The foregoing principles and requirements will be followed in regard to tort claims against the United States under other subparts, with certain exceptions noted within the individual subparts or particular tort statutes.

    (c) Interpretation will be made in accordance with FTCA case law and also maritime case law where applicable. Additionally, a noncombat activity can furnish the basis for a claim under subparts C, F, and J of this part. Noncombat activities include claims arising out of civil works, such as inverse condemnation.

    (d) Federal, not state or local, law applies to a determination as to who is a federal employee or a member of the armed forces. Under all subparts, the designation “federal employee” excludes a contractor of the United States. See 28 U.S.C. 2671. See however, § 536.23(b) (4)(ii) concerning personal services contractors. For employment identification purposes apply FTCA case law in making a determination.

    (e) Federal, not state or local, law applies to an interpretation of the SOL under all subparts. Minority or incompetence does not toll the SOL. Case law developed under the FTCA will be used in other subparts in interpreting SOL questions.

    (f) Under the FTCA state or local law is used to determine scope of employment and under other subparts for guidance.

    Constitutional torts.

    A claim for violation of the U.S. Constitution does not constitute a state tort and is not cognizable under any subpart. A constitutional claim will be scrutinized in order to determine whether it is totally or partially payable as a state tort. For example, a Fifth Amendment taking may be payable in an altered form as a real estate claim. For further discussion see DA Pam 27-162, paragraph 2-36.

    Incident to service.

    (a) A member of the armed forces' claim for personal injury or wrongful death arising incident to service is not payable under any subpart except to the extent permitted by the receiving State under §§ 536.107 through 536.113 (Claims arising overseas); however, a claim by a member of the United States Armed Forces for property loss or damage may be payable under AR 27-20, chapter 11 or, if not, under subparts C, E, F, or G of this part. Derivative claims and claims for indemnity are also excluded.

    (b) Claims for personal injury or wrongful death by members of a foreign military force participating in a joint military exercise or operation arising incident to service are not payable under any subpart. Claims for property loss or damage, but not subrogated claims, may be payable under subpart C of this part. Derivative claims and claims for indemnity or contribution are not payable under any subpart.

    Note to § 536.43:

    For further discussion see DA Pam 27-162, paragraph 2-37.

    FECA and LSHWCA claims exclusions.

    A federal or NAFI employee's personal injury or wrongful death claim payable under the Federal Employees Compensation Act (FECA) or the Longshore and Harbor Workers Compensation Act (LSHWCA) is not payable under any subpart. Derivative claims are also excluded but a claim for indemnity may be payable under certain circumstances. A federal or NAFI employee's claim for an incident-to-service property loss or damage may be payable under AR 27-20, chapter 11 or, if not, under subparts C, D, F, G, H or J of this part. For further discussion see DA Pam 27-162, paragraph 2-38.

    Statutory exceptions.

    This topic is more fully discussed in DA Pam 27-162, paragraph 2-39. The exclusions listed below are found at 28 U.S.C. 2680 and apply to subparts C, D, F, and H and §§ 536.107 through 536.113 (Claims arising in the United States) of subpart G, except as noted therein, and not to subparts E, J or §§ 536.107-536.113 (Claims arising overseas) of subpart G of this part. A claim is not payable if it:

    (a) Is based upon an act or omission of an employee of the U.S. government, exercising due care, in the execution of a statute or regulation, whether or not such statute or regulation is valid. This exclusion does not apply to a noncombat activity claim.

    (b) Is based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the government, whether or not the discretion is abused. This exclusion does not apply to a noncombat activity claim.

    (c) Arises out of the loss, miscarriage, or negligent transmission of letters or postal matters. This exclusion is not applicable to registered or certified mail claims under subpart C of this part. See § 536.34(i).

    (d) Arises in respect of the assessment or collection of any tax or customs duty, or the detention of any goods or merchandise by any customs or other law enforcement officer. See 28 U.S.C. 2680(c).

    (e) Is cognizable under the SIAA (46 U.S.C. app. 741-752), the PVA (46 U.S.C. app. 781-790), or the AEA (46 U.S.C. app. 740). This exclusion does not apply to subparts C, F, H or J of this part.

    (f) Arises out of an act or omission of any federal employee in administering the provisions of the Trading with the Enemy Act, 50 U.S.C. app. 1-44.

    (g) Is for damage caused by the imposition or establishment of a quarantine by the United States.

    (h) Arises out of assault, battery, false imprisonment, false arrest, malicious prosecution, abuse of process, libel, slander, misrepresentation, deceit, or interference with contract rights, except for acts or omissions of investigation of law enforcement officers of the U.S. government with regard to assault, battery, false imprisonment, false arrest, abuse of process or malicious prosecution. This exclusion also does not apply to a health care provider as defined in 10 U.S.C. 1089 and § 536.80 of this part, under the conditions listed therein.

    (i) Arises from the fiscal operations of the U.S. Department of the Treasury or from the regulation of the monetary system.

    (j) Arises out of the combatant activities of U.S. military or naval forces, or the Coast Guard during time of war. Start Printed Page 46278

    (k) Arises in a foreign country. This exclusion does not apply to subparts C, E, F, H, J or §§ 536.114 through 536.116 (Claims arising overseas) of subpart G of this part.

    (l) Arises from the activities of the Tennessee Valley Authority, 28 U.S.C. 2680(l).

    (m) Arises from the activities of the Panama Canal Commission, 28 U.S.C. 2680(m).

    (n) Arises from the activities of a federal land bank, a federal intermediate credit bank, or a bank for cooperatives, 28 U.S.C. 2680(n).

    Note to § 536.45:

    This topic is more fully discussed in DA Pam 27-162, paragraph 2-39.

    Other exclusions.

    (a) Statutory employer. A claim is not payable under any subpart if it is for personal injury or death of any contract employee for whom benefits are provided under any workers' compensation law, if the provisions of the workers' compensation insurance are retrospective and charge an allowable expense to a cost-type contract, or if precluded by state law. See Federal Tort Claims Handbook (FTCH), section II, D7 (posted on the Web at https://www.jagcnet.army.mil/​laawsxxi/​cds.nsf. Select the link “Claims” under “JAG Publications.”) The statutory employer exclusion also applies to claims that may be covered by the Defense Bases Act, 42 U.S.C. 1651-1654.

    (b) Flood exclusion. Within the United States a claim is not payable if it arises from damage caused by flood or flood waters associated with the construction or operation of a COE flood control project, 33 U.S.C. 702(c). See DA Pam 27-162, paragraph 2-40.

    (c) ARNG property. A claim is not payable under any subpart if it is for damage to, or loss of, property of a state, commonwealth, territory, or the District of Columbia caused by ARNG personnel, engaged in training or duty under 32 U.S.C. 316, 502, 503, 504, or 505, who are assigned to a unit maintained by that state, commonwealth, territory, or the District of Columbia. See DA Pam 27-162, paragraph 2-41.

    (d) Federal Disaster Relief Act. Within the United States a claim is not payable if it is for damage to, or loss of, property or for personal injury or death arising out of debris removal by a federal agency or employee in carrying out the provisions of the Federal Disaster Relief Act, 42 U.S.C. 5173. See DA Pam 27-162, paragraph 2-42.

    (e) Non-justiciability doctrine. A claim is not payable under any subpart if it arises from activities that present a non-justiciable political question. See DA Pam 27-162, paragraph 2-43.

    (f) National Vaccine Act. (42 U.S.C. 300aa-l through 300aa-7). A claim is not payable under any subpart if it arises from the administration of a vaccine unless the conditions listed in the National Vaccine Injury Compensation Program (42 U.S.C. 300aa-9 through 300aa-19) have been met. See DA Pam 27-162, paragraph 2-17c(6)(a).

    (g) Defense Mapping Agency. A claim is not payable under any subpart if it arises from inaccurate charting by the Defense Mapping Agency, 10 U.S.C. 456. See FTCH section II, B4s (Web address at paragraph (a) of this section).

    (h) Quiet Title Act. Within the U.S., a claim is not payable if it falls under the Quiet Title Act 28 U.S.C. 2409a.

    (i) Defense Bases Act. A claim arising outside the United States is not payable if it is covered by the Defense Bases Act, 42 U.S.C. 1651-1654.

    Note to § 536.46:

    See parallel discussion at DA Pam 27-162, paragraphs 2-40 through 2-43.

    Statute of limitations.

    To be payable, a claim against the United States under any subpart, except §§ 536.114 through 536.116 (Claims arising overseas), must be filed no later than two years from the date of accrual as determined by federal law. The accrual date is the date on which the claimant is aware of the injury and its cause. The claimant is not required to know of the negligent or wrongful nature of the act or omission giving rise to the claim. The date of filing is the date of receipt by the appropriate federal agency, not the date of mailing. See also § 536.26(a) and parallel discussion at DA Pam 27-162, paragraph 2-44.

    Federal employee requirement.

    To be payable, a claim under any subpart except subpart K of this part, §§ 536.153 through 536.157 (Claims involving tortfeasors other than nonappropriated fund employees), must be based on the acts or omissions of a member of the armed forces, a member of a foreign military force within the United States with which the United States has a reciprocal claims agreement, or a federal civilian employee. This does not include a contractor of the United States. Apply federal case law for interpretation. See parallel discussion at DA Pam 27-162, paragraph 2-46.

    Scope of employment requirement.

    To be payable, a claim must be based on acts or omissions of a member of the armed forces, a member of a foreign military force within the United States with which the United States has a reciprocal claims agreement, or a federal employee acting within the scope of employment, except for subparts E, J, or subpart K of this part, §§ 536.153 through 536.157 (Claims involving tortfeasors other than nonappropriated fund employees). A claim arising from noncombat activities must be based on the armed service's official activities. Excluded are claims based on vicarious liability or the holder theory in which the owner of the vehicle is responsible for any injury or damage regardless of who the operator was. See parallel discussion at DA Pam 27-162, paragraph 2-46.

    Determination of damages—applicable law.

    (a) The Federal Tort Claims Act. The whole law of the place where the incident giving rise to the claim occurred, including choice of law rules, is applicable. Therefore, the law of the place of injury or death does not necessarily apply. Where there is a conflict between local law and an express provision of the FTCA, the latter governs.

    (b) The Military Claims Act or National Guard Claims Act. See subparts C and F of this part. The law set forth in § 536.80 applies only to claims accruing on or after September 1, 1995. The law of the place of the incident giving rise to the claim will apply to claims arising in the United States, its commonwealths, territories and possessions prior to September 1, 1995. The general principles of U.S. tort law will apply to property damage or loss claims arising outside the United States prior to September 1, 1995. Established principles of general maritime law will apply to injury or death claims arising outside the United States prior to September 1, 1995. See Moragne v. States Marine Lines, Inc., 398 U.S. 375 (1970) and federal case law. Where general maritime law provides no guidance, the general principles of U.S. tort law will apply.

    (c) The Foreign Claims Act. See subpart J of this part. The law of the place of occurrence applies to the resolution of claims. However, the law of damages set forth in § 536.139 will serve as a guide.

    (d) The Army Maritime Claims Settlement Act. Maritime law applies.

    (e) Damages not payable. Under all subparts, property loss or damage refers Start Printed Page 46279to actual tangible property. Accordingly, consequential damages, including, but not limited to bail, interest (prejudgment or otherwise), or court costs are not payable. Costs of preparing, filing, and pursuing a claim, including expert witness fees, are not payable. The payment of punitive damages, that is, damages in addition to general and special damages that are otherwise payable, is prohibited. See DA Pam 27-162, paragraphs 2-56 and 3-4b.

    (f) Source of attorney's fees. Attorney's fees are taken from the settlement amount and not added thereto. They may not exceed 20 percent of the settlement amount under any subpart.

    Note to § 536.50:

    For further discussion see DA Pam27-162, paragraph 2-51.

    Collateral source rule.

    Where permitted by applicable state or maritime law, damages recovered from collateral sources are payable under subparts D and H, but not under subparts C, E, F, or J of this part. For further discussion see DA Pam 27-162, paragraph 2-57.

    Subrogation.

    Subrogation is the substitution of one person in place of another with regard to a claim, demand or right. It should not be confused with a lien, which is an obligation of the claimant. Applicable state law should be researched to determine the distinction between subrogation and a lien. Subrogation claims are payable under subparts D and H, but not under subparts C, E, F or J of this part. For further discussion see DA Pam 27-162, paragraph 2-58.

    Evaluation of claims—general rules and guidelines.

    (a) Before claims personnel evaluate a claim:

    (1) A claimant or claimant's legal representative will be furnished the opportunity to substantiate the claim by providing essential documentary evidence according to the claim's nature including, but not instead of, the following: medical records and reports, witness statements, itemized bills and paid receipts, estimates, federal tax returns, W-2 forms or similar proof of loss of earnings, photographs, and reports of appraisals or investigation. If necessary, request permission, through the legal representative, to interview the claimant, the claimant's family, proposed witnesses and treating health care providers (HCPs). In a professional negligence claim, the claimant will submit an expert opinion when requested. State law concerning the requirement for an affidavit of merit should be cited.

    (2) When the claimant or the legal representative fails to respond in a timely manner to informal demands for documentary evidence, interviews, or an independent medical examination (IME), make a written request. Such written request provides notice to the claimant that failure to provide substantiating evidence will result in an evaluation of the claim based only on information currently in the file. When, despite the government's request, there is insufficient information in the file to permit evaluation, the claim will be denied for failure to document it. Failure to submit to an IME or sign an authorization to use medical information protected by HIPAA, for review or evaluation by a source other than claims personnel, are both grounds for denial for failure to document, provided such evaluation is essential to the determination of liability or damages. State a time limit, for example, 30 or 60 days, to furnish the substantiation or expert opinion required in a medical malpractice claim.

    (3) If, in exchange for complying with the government's request for the foregoing information, the claimant or the legal representative requests similar information from the file, the claimant may be provided such information and documentation as is releasable under the Federal Rules of Civil Procedure (FRCP). Additionally, work product may be released if such release will help settle the claim. See § 536.18.

    (b) An evaluation should be viewed from the claimant's perspective. In other words, before denying a claim, first determine whether there is any reasonable basis for compromise. Certain jurisdictional issues and statutory bases may not be open for compromise. The incident to service and FECA exclusions are rarely subject to compromise, whereas the SOL is more subject to compromise. Factual and legal disputes are compromisable, frequently providing a basis for limiting damages, not necessarily grounds for denial. Where a precise issue of dispute is identified and is otherwise unresolvable, mediation by a disinterested qualified person, such as a federal judge, or foreign equivalent for claims arising under the FCA, should be obtained upon agreement with the claimant or the claimant's legal representative. Contributory negligence has given way to comparative negligence in most United States jurisdictions. In most foreign countries, comparative negligence is the rule of law.

    Note to § 536.53:

    For further discussion see DA Pam 27-162, paragraph 2-59.

    Joint tortfeasors.

    When joint tortfeasors are liable, it is DA policy to pay only the fair share of a claim attributable to the fault of the United States rather than pay the claim in full and then bring suit against the joint tortfeasor for contribution. If payment from a joint tortfeasor is not forthcoming after the CJA's demand, the United States should settle for its fair share, provided the claimant is willing to hold the United States harmless. Where a joint tortfeasor's liability greatly outweighs that of the United States, the claim should be referred to the joint tortfeasor for action.

    Structured settlements.

    (a) The use of future periodic payments, including reversionary medical trusts, is encouraged to ensure that the injured party is adequately compensated and able to meet future needs.

    (1) It is necessary to ensure adequate care and compensation for a minor or other incompetent claimant or unemployed survivor over a period of years.

    (2) A medical trust is necessary to ensure the long-term availability of funds for anticipated future medical care, the cost of which is difficult to predict.

    (3) The injured party's life expectancy cannot be reasonably determined or is likely to be shortened.

    (b) Under subpart D of this part, structured settlements cannot be required but are encouraged in situations listed above or where state law permits them. In the case of a minor, every effort should be made to insure that the minor, and not the parents, receives the benefit of the settlement. Annuity payments at the age of majority should be considered. If rejected, a blocked bank account may be used.

    (c) It is the policy of the Department of Justice never to discuss the tax-free nature of a structured settlement.

    Note to § 536.55:

    For further discussion, see DA Pam 27-162, paragraph 2-63.

    Negotiations—purpose and extent.

    It is DA policy to settle meritorious claims promptly and fairly through direct negotiation at the lowest possible level. The Army's negotiator should not admit liability as such is not necessary. However, the settlement should reflect diminished value where contributory negligence or other value-diminishing Start Printed Page 46280factors exist. The negotiator should be thoroughly familiar with all aspects of the case, including the claimant's background, the key witnesses, the anticipated testimony and the appearance of the scene. There is no substitute for the claims negotiator's personal study of, and participation in, the case before settlement negotiations begin. If settlement is not possible due to the divergence in the offers, refine the issues as much as possible in order to expedite any subsequent suit. Mediation should be used if the divergence is due to an issue of law affecting either liability or damages. For further discussion see DA Pam 27-162, paragraph 2-64.

    Who should negotiate.

    An AAO or, when delegated additional authority, an ACO or a CPO, has authority to settle claims in an amount exceeding the monetary authority delegated by regulation. It is DA policy to delegate USARCS authority, on a case-by-case basis, to an ACO or a CPO possessing the appropriate ability and experience. Only an attorney should negotiate with a claimant's attorney. Negotiations with unrepresented claimants may be conducted by a non-attorney, under the supervision of an attorney. For further discussion see DA Pam 27-162, paragraph 2-65.

    Settlement negotiations with unrepresented claimants.

    All aspects of the applicable law and procedure, except the amount to be claimed, should be explained to both potential and actual claimants. The negotiator will ensure that the claimant is aware of whether the negotiator is an attorney or a non-attorney, and that the negotiator represents the United States. As to claims within USARCS' monetary authority, the chronology and details of negotiations should be memorialized with a written record furnished to the claimant. The claimant should understand that it is not necessary to hire an attorney, but when an attorney is needed, the negotiator should recommend hiring one. In a claim where liability is not an issue, the claimant should be informed that if an attorney is retained, the claimant should attempt to negotiate an hourly fee for determination of damages only. For further discussion see DA Pam 27-162, paragraph 2-68.

    Settlement or approval authority.

    “Settlement authority” is a statutory term (10 U.S.C. 2735) meaning that officer authorized to approve, deny or compromise a claim, or make final action. “Approval authority” means the officer empowered to settle, pay or compromise a claim in full or in part, provided the claimant agrees. “Final action authority” means the officer empowered to deny or make a final offer on a claim. Determining the proper officer empowered to approve or make final action on a claim depends on the claims statute involved and any limitations that apply under that statute. DA Pam 27-162, paragraph 2-69, outlines how various authority is delegated among offices.

    Splitting property damage and personal injury claims.

    Normally, a claim will include all damages that accrue by reason of the incident. Where a claimant has a claim for property damage and personal injury arising from the same incident, the property damage claim may be paid, under certain circumstances, prior to the filing of the personal injury claim. The personal injury claim may be filed later provided it is filed within the applicable statute of limitations. When both property damage and personal injury arise from the same incident, the property damage claim may be paid to either the claimant or, under subparts D or H of this part, the insurer and the same claimant may receive a subsequent payment for personal injury. Only under subparts D or H of this part may the insurer receive subsequent payment for subrogated medical bills and lost earnings when the personal injury claim is settled. The primary purpose of settling an injured claimant's property damage claim before settling the personal injury claim is to pay the claimant for vehicle damage expeditiously and avoid costs associated with delay such as loss of use, loss of business, or storage charges. The Commander USARCS' approval must be obtained whenever the estimated value of any one claim exceeds $25,000, or the value of all claims, actual or potential, arising from the incident exceeds $50,000; however, if the claim arises under the FTCA or AMCSA, only if the amount claimed exceeds $50,000, or $100,000 per incident.

    Advance payments.

    (a) This section implements 10 U.S.C. 2736 (Act of September 8, 1961 (75 Stat. 488)) as amended by Public Law 90-521 (82 Stat. 874); Public Law 98-564 (90 Stat. 2919); and Public Law 100-465 (102 Stat. 2005)). No new liability is created by 10 U.S.C. 2736, which merely permits partial advance payments, only under subparts C, F or J of this part, on claims not yet filed. See AR 27-20, paragraph 11-18 for information on emergency partial payments in personnel claims, which are not governed by 10 U.S.C. 2736.

    (b) The Judge Advocate General (TJAG) and the Assistant Judge Advocate General (TAJAG) may make advance payments in amounts not exceeding $100,000; the Commander USARCS, in amounts not exceeding $25,000, and the authorities designated in §§ 536.78(b)(4) and (b)(5) and 536.101, in amounts not exceeding $10,000, subject to advance coordination with USARCS, if the estimated total value of the claim exceeds their monetary authority. Requests for advance payments in excess of $10,000 will be forwarded to USARCS for processing.

    (c) Under subpart J of this part, three-member foreign claims commissions may make advance payments under the FCA in amounts not exceeding $10,000, subject to advance coordination with USARCS if the estimated total value of the claim exceeds their monetary authority.

    (d) An advance payment, not exceeding $100,000, is authorized in the limited category of claims or potential claims considered meritorious under subparts C, F or J of this part, that result in immediate hardship. An advance payment is authorized only under the following circumstances:

    (1) The claim, or potential claim, must be determined to be cognizable and meritorious under the provisions of subparts C, F or J of this part.

    (2) An immediate need for food, clothing, shelter, medical or burial expenses, or other necessities exists.

    (3) The payee, so far as can be determined, would be a proper claimant, including an incapacitated claimant's spouse or next-of-kin.

    (4) The total damage sustained must exceed the amount of the advance payment.

    (5) A properly executed advance payment acceptance agreement has been obtained. This acceptance agreement must state that it does not constitute an admission of liability by the United States and that the amount paid shall be deducted from any subsequent award.

    (e) There is no statutory authority for making advance payments for claims payable under subparts D or H of this part.

    Note to § 536.61:

    For further discussion see DA Pam 27-162, paragraph 2-71.

    Action memorandums.

    (a) When required. (1) All claims will be acted on prior to being closed except for those that are transferred. For claims on which suit is filed before final action, Start Printed Page 46281see § 536.66. A settlement authority may deny or pay in full or in part any claim in a stated amount within his or her delegated authority. An approval authority may pay in full or in part, but may not deny, a claim in a stated amount within his or her delegated authority. If any one claim arising out of the same incident exceeds a settlement or approval authority's monetary jurisdiction, all claims from that incident will be forwarded to the authority having jurisdiction.

    (2) In any claim which must be supported by an expert opinion as to duty, negligence, causation or damages, an expert opinion must be submitted upon request. All opinions must meet the standards set forth in Federal Rule of Evidence 702.

    (3) An action memorandum is required for all final actions regardless of whether payment is made electronically. The memorandum will contain a sufficient rendition of the facts, law or damages to justify the action being taken. (A model action is posted on the USARCS Web site; for the address see § 536.2(a).)

    (b) Memorandum of Opinion. Upon completion of the investigation, the ACO or CPO will prepare a memorandum of opinion in the format prescribed at DA Pam 27-162, when a claim is forwarded to USARCS for action. This requirement can be waived by the USARCS AAO.

    (c) Claim brought by a claims authority or superior. A claim filed by an approval or settlement authority or his or her superior officer in the chain of command or a family member of either will be investigated and forwarded for final action, without recommendation, to the next higher settlement authority (in an overseas area, this includes a command claims service) or to USARCS.

    Note to § 536.62:

    For further discussion see DA Pam 27-162, paragraph 2-72.

    Settlement agreements.

    (a) When required. (1) A claimant's acceptance of an award constitutes full and final settlement and release of any and all claims against the United States and its employees, except as to payments made under §§ 536.60 and 536.61. A settlement agreement is required prior to payment on all tort claims, whether the claim is paid in full or in part.

    (2) DA Form 1666 (Claims Settlement Agreement) may be used for payment of COE claims of $2500 or less or all Army Central Insurance Fund and Army and Air Force Exchange Service claims.

    (3) DA Form 7500 (Tort Claim Payment Report) will be used for all payments from the Defense Finance and Accounting Service (DFAS), for example, FTCA claims of $2500 or less, FCA and MCA claims of $100,000 or less and all maritime claims regardless of amount.

    (4) Financial Management Service (FMS) Forms 194, 196 and 197 will be used for all payments from the Judgment Fund, for example, FTCA claims exceeding $2,500, MCA and FCA claims exceeding $100,000.

    (5) An alternative settlement agreement will be used when the claimant is represented by an attorney, or when any of the above settlement agreement forms are legally insufficient (such as when multiple interests are present, a hold harmless agreement is reached, or there is a structured settlement). For further discussion, see DA Pam 27-162, paragraph 2-73c.

    (b) Unconditional settlement. The settlement agreement must be unconditional. The settlement agreement represents a meeting of the minds. Any changes to the agreement must be agreed upon by all parties. The return of a proffered settlement agreement with changes written thereon or on an accompanying document represents, in effect, a counteroffer and must be resolved. Even if the claimant signs the agreement and objects to its terms, either in writing or verbally, the settlement is defective and the objection must be resolved. Otherwise a final offer should be made.

    (c) Court approval. (1) When required. Court approval is required in a wrongful death claim, or where the claimant is a minor or incompetent. The claimant is responsible to obtain court approval in a jurisdiction that is locus of the act or omission giving rise to the claim or in which the claimant resides. The court must be a state or local court, including a probate court. If the claimant can show that court approval is not required under the law of the jurisdiction where the incident occurred or where the claimant resides, the citation of the statute will be provided and accompany the payment documents.

    (2) Attorney representation. If the claimant is a minor or incompetent, the claimant must be represented by a lawyer. If not already represented, the claimant should be informed that the requirement is mandatory unless state or local law expressly authorizes the parents or a person in loco parentis to settle the claim.

    (3) Costs. The cost of obtaining court approval will be factored into the amount of the settlement; however, the amount of the costs and other costs will not be written into the settlement, only the 20% limitation on attorney fees will be included.

    (4) Claims involving an estate or personal representative of an estate. On claims presented on behalf of a decedent's estate, the law of the state having jurisdiction should be reviewed to determine who may bring a claim on behalf of the estate, if court appointment of an estate representative is required, and if court approval of the settlement is required.

    (d) Signature requirements. (1) Except as noted below, all settlement agreements will be signed individually by each claimant. A limited power of attorney signed by the claimant specifically stating the amount being accepted and authorizing an attorney at law or in fact to sign is acceptable when the claimant is unavailable to sign. The signatures of the administrator or executor of the estate, appointed by a court of competent jurisdiction or authorized by local law, are required. The signatures of all adult beneficiaries, acknowledging the settlement, should be obtained unless permission is given by Commander USARCS. Court approval must be obtained where required by state law. If not required by state law, the citation of the state statute will accompany the payment document. Additionally, all adult heirs will sign as acknowledging the settlement. In lieu thereof, where the adult heirs are not available, the estate representative will acknowledge that all heirs have been informed of the settlement.

    (2) Generally, only a court-appointed guardian of a minor's estate, or a person performing a similar function under court supervision, may execute a binding settlement agreement on a minor's claim. In the United States, the law of the state where the minor resides or is domiciled will determine the age of majority and the nature and type of court approval that is needed, if any. The age of majority is determined by the age at the time of settlement, not the date of filing.

    (3) For claims arising in foreign countries where the amount agreed upon does not exceed $2,500, the requirement to obtain a guardian may be eliminated. For settlements over $2,500, whether or not the claim arose in the United States, refer to applicable local law, including the law of the foreign country where the minor resides.

    (4) In claims where the claimant is an incompetent, and for whom a guardian has been appointed by a court of competent jurisdiction, the signature of the guardian must be obtained. In cases in which competence of the claimant appears doubtful, a written statement by Start Printed Page 46282the plaintiff's attorney and a member of the immediate family should be obtained.

    (5) Settlement agreements involving subrogated claims must be executed by a person authorized by the corporation or company to act in its behalf and accompanied by a document signed by a person authorized by the corporation or company to delegate execution authority.

    (6) If it is believed that the foregoing requirements are materially impeding settlement of the claim, bring the matter to the attention of the Commander USARCS for appropriate resolution.

    (e) Attorneys' fees and costs. (1) Attorneys' fees for all subparts fall under the American Rule and are payable only out of the up front cash in any settlement. Attorneys' fees will be stated separately in the settlement agreement as a sum not to exceed 20% of the award.

    (2) Costs are a matter to be determined solely between the attorney and the claimant and will not be set forth or otherwise enumerated in the settlement agreement.

    (f) Claims involving workers' compensation carriers. The settlement of a claim involving a claimant who has elected to receive workers' compensation benefits under local law may require the consent of the workers' compensation insurance carrier, and in certain jurisdictions, the state agency that has authority over workers' compensation awards. Accordingly, claims approval and settlement authorities should be aware of local requirements.

    (g) Claims involving multiple interests. Where two or more parties have an interest in the claim, obtain signatures on the settlement agreement from all parties. Examples are where both the subrogee and subrogor file a single claim for property damage, where both landlord and tenant file a claim for damage to real property, or when a POV is leased, both the lessor or lessee.

    (h) Claims involving structured settlements. All settlement agreements involving structured settlements will be prepared by the Tort Claims Division, USARCS, and approved by the Chief or Deputy Chief, Tort Claims Division.

    Final offers.

    (a) When claims personnel believe that a claim should be compromised, and after every reasonable effort has been made to settle at less than the amount claimed, a settlement authority will make a written final offer within his or her monetary jurisdiction or forward the claim to the authority having sufficient monetary jurisdiction, recommending a final offer under the applicable statute. The final offer notice will contain sufficient detail to outline each element of damages as well as discuss contributory negligence, the SOL or other reasons justifying a compromise offer. The offer letter should include language indicating that if the offer is not accepted within a named time period, for example, 30 or 60 days, the offer is withdrawn and the claim is denied.

    (b) A final offer under subpart D of this part will notify the claimant of the right to sue, not later than six months from the notice's date of mailing, and of the right to request reconsideration. The procedures for processing a request for reconsideration are set forth in § 536.89.

    (c) Under subparts C or F of this part, the notice will contain an appeal paragraph. A similar procedure will be followed in subparts E and H of this part. Subpart J of this part sets forth its own procedures for FCA final offers. The procedures for processing an appeal are set forth in § 536.79 of this part. The letter must inform claimants of the following:

    (1) They must accept the offer within 60 days or appeal. The appeal should state a counteroffer.

    (2) The identity of the official who will act on the appeal, and the requirement that the appeal will be addressed to the settlement authority who last acted on the claim.

    (3) No form is prescribed for the appeal, but the notice of appeal must fully set forth the grounds for appeal or state that it is based on the record as it exists at the time of denial or final offer.

    (4) The appeal must be postmarked not later than 60 days after the date of mailing of the final notice of action. If the last day of the appeal period falls on a Saturday, Sunday, or legal holiday, as specified in Rule 6a of the Federal Rules of Civil Procedure, the following day will be considered the final day of the appeal period.

    (d) Where a claim for the same injury falls under both subparts C and D of this part (the MCA and the FTCA), and the denial or final offer applies equally to each such claim, the letter of notification must advise the claimant that any suit brought on any portion of the claim filed under the FTCA must be brought not later than six months from the date of mailing of the notice of final offer and any appeal under subpart C of this part must be made as stated in paragraph (c) of this section. Further, the claimant must be advised that if suit is brought, action on any appeal under subpart C of this part will be held in abeyance pending final determination of such suit.

    (e) Upon request, the settlement authority may extend the six-month reconsideration or 60-day appeal period provided good cause is shown. The claimant will be notified as to whether the request is granted under the FTCA and that the request precludes the filing of suit under the FTCA for 6 months. Only one reconsideration is authorized. Accordingly, that claimant should be informed of the need to make all submissions timely.

    Note to § 536.64:

    For further discussion see DA Pam 27-162, paragraph 2-74.

    Denial notice.

    (a) Where there is no reasonable basis for compromise, a settlement authority will deny a claim within his or her monetary jurisdiction or forward the claim recommending denial to the settlement authority that has jurisdiction. The denial notice will contain instructions on the right to sue or request reconsideration. The notice will state the basis for denial. No admission of liability will be made. A notice to an unrepresented claimant should detail the basis for denial in lay language sufficient to permit an informed decision as to whether to request appeal or reconsideration. In the interest of deterring reconsideration, appeal or suit, a denial notice may be releasable under the Federal Rules of Civil Procedure or by the work product documents doctrine.

    (b) Regardless of the claim's nature or the statute under which it may be considered, letters denying claims on jurisdictional grounds that are valid, certain, and not easily overcome (and for this reason no detailed investigation as to the merits of the claim was conducted), must state that denial on such grounds is not to be construed as an opinion on the merits of the claim or an admission of liability. In medical malpractice claims, the denial should state that the file is being referred to U.S. Army Medical Command for review. If sufficient factual information exists to make a tentative ruling on the merits of the claim, liability may be expressly denied.

    Note to § 536.65:

    See § 536.53, on denying a claim for failure to substantiate. In addition, the procedures and rules in DA Pam 27-162, paragraph 2-69, settlement and approval authority, apply equally to the denial of claims. See also DA Pam 27-162, paragraph 2-75.

    The “Parker” denial.

    (a) When suit is filed before final action is taken on a subpart D of this part claim, a denial letter will be issued only upon request of DOJ or the trial Start Printed Page 46283attorney. If suit is filed prematurely or in error, the claimant may be requested to withdraw the suit without prejudice. Such a request must be coordinated with the trial attorney.

    (b) Claimants who have filed companion claims should be notified that, due to suit being filed, no action can be taken pending the outcome of suit and they may file suit if they wish.

    Note to § 536.66:

    For further discussion see DA Pam 27-162, paragraph 2-76.

    Mailing procedures.

    Thirty or sixty day letters seeking information from claimants, final offers and denial notices are time-sensitive as they require a claimant to take additional action within certain time limits. Accordingly, follow procedures to ensure that the date of mailing and receipt of a request for reconsideration are documented. Use certified mail with return receipt requested (or registered mail, if being sent to a foreign country other than by the military postal system) to mail such notices. Upon receipt, an appeal or request for reconsideration will be date-time stamped, logged in, and acknowledged as set forth in § 536.68.

    Note to § 536.67:

    See also AR 27-20, paragraph 13-5, and DA Pam 27-162, paragraph 2-77.

    Appeal or reconsideration.

    (a) An appeal or a request for reconsideration will be acknowledged in writing. A request for reconsideration under subpart D of this part invokes the six-month period during which suit cannot be filed, 28 CFR 14.9(b). The acknowledgment letter will underscore this restriction.

    (b) Where the contents of the appeal or request for reconsideration indicate, additional investigation will be conducted and the original action changed if warranted. Except for subpart J of this part, which sets forth separate rules for FCCs, if the relief requested is not warranted the settlement authority will forward the claim to a higher settlement authority with a claims memorandum of opinion (see § 536.62) stating the reasons why the request is invalid.

    Note to § 536.68:

    See also DA Pam 27-162, paragraph 2-78.

    Retention of file.

    After final action has been taken, the settlement authority will retain the file until at least one month after either the period of filing suit or the appeal has expired and until all data has been entered into the database. A paid claim file will be retained until final action has been taken on all other claims arising out of the same incident. If any single claim arising out of the same incident must be forwarded to higher authority for final action, all claims files for that incident will be forwarded at the same time. For further discussion see DA Pam 27-162, paragraph 2-79.

    Preparation and forwarding of payment vouchers.

    (a) An unrepresented claimant will be listed as the sole payee. Joint claimants will not be listed since settlement agreements must specify the amount payable to each claimant individually and each must be issued a separate check.

    (b) When a claimant is represented by an attorney, only one payment voucher will be issued with the claimant and the attorney as joint payees. The payment will be sent to the office of the claimant's attorney. The attorney of record, either an individual or firm designated by the claimant, will be the co-payee. If claimant has been represented by other attorneys in the same claim, such attorneys will not be listed as payees, even if they have a lien. Satisfaction of any such fee will be a matter between the claimant and such attorney. If payment is made by electronic transfer, the funds will be paid into the account of the claimant. However, if requested, the payment may be made into the attorney's escrow account provided the claimant has provided written authorization.

    (c) In a structured settlement the structured settlement broker will be the sole payee, who is authorized to issue checks for the amounts set forth in the settlement agreement. The up-front cash payment may be deposited into an escrow account established for the benefit of the claimant.

    (d) If a claimant is a minor or has been declared incompetent by a court or other authority authorized to do so, payment will be made to the court-appointed guardian of the minor or incompetent, at a financial institution approved by the court approving the settlement.

    (e) If the claimant is representing a deceased's estate on a wrongful death claim, or a survival action on behalf of the deceased, the payment will be made to the court-appointed representative of the estate. No payment will be made directly to the estate.

    Note to § 536.70:

    See also § 536.63 and DA Pam 27-162, paragraphs 2-73 and 2-81.

    Fund sources.

    (a) 31 U.S.C. 1304 sets forth the type and limits of claims payable out of the Judgment Fund. Only final payments that are not payable out of agency funds are allowable, per the Treasury Financial Manual, Volume I, part 6, Chapter 3110, at Section 3115, September 2000 (available at http://www.fms.treas.gov/​tfm/​vol1/​v1p6c310.pdf). Threshold amounts for payment from the judgment fund vary according to the subpart and statutes under which a claim is processed. To determine the threshold amount for any given payment procedure one must arrive at a sum of all awards for all claims arising out of that incident, including derivative claims. A joint amount is not acceptable. A claim for injury to a spouse or a child is a separate claim from one for loss of consortium or services by a spouse or parent. The monetary limits of $2,500 set forth in subpart D and $100,000 set forth in subparts C, F or J of this part, apply to each separate claim.

    (b) A subpart D, E, or subpart G of this part, §§ 536.107 through 536.113 claim for $2,500 or less is paid from the open claims allotment (see AR 27-20 paragraph 13-6b(1)) or, if arising from a project funded by a civil works appropriation, from COE civil works funds. The Department of the Treasury pays any settlement exceeding $2,500 in its entirety, from the Judgment Fund. However, if a subpart G of this part, §§ 536.107-536.113 claim is treated as a noncombat activity claim, payment is made as set forth in paragraph (c) of this section.

    (c) The first $100,000 for each claimant on a claim settled under subparts C, F or J of this part is paid from the open claims allotment. Any amount over $100,000 is paid out of the Judgment Fund.

    (d) If not over $500,000, a claim arising under subpart H of this part is paid from the open claims allotment or civil works project funds as appropriate. A claim exceeding $500,000 is paid entirely by a deficiency appropriation.

    (e) AAFES or NAFI claims are paid from nonappropriated funds, except when such claims are subject to apportionment between appropriated and nonappropriated funds. See DA Pam 27-162, paragraph 2-80h.

    (f) COE claims arising out of projects not funded out of civil works project funds are payable from the open claims allotment not to exceed $2,500 for subpart D claims and $100,000 for claims arising from subparts C, F or J of this part and from the Judgment Fund, over such amounts.

    Note to § 536.71:

    For further discussion see DA Pam 27-162, paragraph 2-80.

    Start Printed Page 46284
    Finality of settlement.

    A claimant's acceptance of an award, except for an advance payment or a split payment for property damage only, constitutes a release of the United States and its employees from all liability. Where applicable, a release should include the ARNG or the sending State. For further discussion see DA Pam 27-162, paragraph 2-82.

    Subpart C—Claims Cognizable Under the Military Claims Act

    Statutory authority for the Military Claims Act.

    The statutory authority for this subpart is contained in the Act of August 10, 1956 (70A Stat. 153, 10 U.S.C. 2733), commonly referred to as the Military Claims Act (MCA), as amended by 90-521, September 1968 (82 Stat. 874); Public Law 90-522, September 1968 (82 Stat. 875); Public Law 90-525, September 1968 (82 Stat. 877); Public Law 93-336, July 8, 1974 (88 Stat. 291); Public Law 98-564, October 1984 (98 Stat. 2918); and Public Law 103-337, October 1994 (108 Stat. 2664).

    Scope for claims under the Military Claims Act.

    (a) The guidance set forth in this subpart applies worldwide and prescribes the substantive bases and special procedural requirements for the settlement of claims against the United States for death or personal injury, or damage to, or loss or destruction of, property:

    (1) Caused by military personnel or civilian employees (enumerated in § 536.23(b)) acting within the scope of their employment, except for non-federalized Army National Guard soldiers as explained in subpart F of this part; or

    (2) Incident to the noncombat activities of the armed services (see AR 27-20, Glossary).

    (b) A tort claim arising in the United States, its commonwealths, territories, and possessions may be settled under this subpart if the Federal Tort Claims Act (FTCA) does not apply to the type of claim under consideration or if the claim arose incident to noncombat activities. For example, a claim by a service member for property loss or damage incident to service may be settled if the loss arises from a tort and is not payable under AR 27-20, Chapter 11.

    (c) A tort claim arising outside the United States may be settled under this subpart only if the claimant has been determined to be an inhabitant (normally a resident) of the United States at the time of the incident giving rise to the claim. See § 536.136(b).

    Claims payable under the Military Claims Act.

    (a) General. Unless otherwise prescribed, a claim for personal injury, death, or damage to, or loss or destruction of, property is payable under this subpart when:

    (1) Caused by an act or omission of military personnel or civilian employees of the DA or DOD, acting within the scope of their employment, that is determined to be negligent or wrongful; or

    (2) Incident to the noncombat activities of the armed services.

    (b) Property. Property that may be the subject of claims for loss or damage under this subpart includes:

    (1) Real property used and occupied under lease (express, implied, or otherwise). See § 536.34(m) and paragraph 2-15m of DA Pam 27-162.

    (2) Personal property bailed to the government under an agreement (express or implied), unless the owner has expressly assumed the risk of damage or loss.

    (3) Registered or insured mail in the DA's possession, even though the loss was caused by a criminal act.

    (4) Property of a member of the armed forces that is damaged or lost incident to service, if such a claim is not payable as a personnel claim under AR 27-20, chapter 11.

    (c) Maritime claims. Claims that arise on the high seas or within the territorial waters of a foreign country are payable unless settled under subpart H of this part.

    Claims not payable under the Military Claims Act.

    (a) Those resulting wholly from the claimant's or agent's negligent or wrongful act. (See § 536.77(a)(1)(i) on contributory negligence).

    (b) Claims arising from private or domestic obligations rather than from government transactions.

    (c) Claims based solely on compassionate grounds.

    (d) A claim for any item, the acquisition, possession, or transportation of which was in violation of DA directives, such as illegal war trophies.

    (e) Claims for rent, damage, or other payments involving the acquisition, use, possession or disposition of real property or interests therein by and for the Department of the Army (DA) or Department of Defense (DOD). See § 536.34(m) and paragraph 2-15m of DA Pam 27-162.

    (f) Claims not in the best interests of the United States, contrary to public policy, or otherwise contrary to the basic intent of the governing statute (10 U.S.C. 2733); for example, claims for property damage or loss or personal injury or death of inhabitants of unfriendly foreign countries or individuals considered to be unfriendly to the United States. When a claim is considered not payable for the reasons stated in this section, it will be forwarded for appropriate action to the Commander USARCS with the recommendations of the responsible claims office.

    (g) Claims presented by a national, or a corporation controlled by a national, of a country at war or engaged in armed conflict with the United States, or any country allied with such enemy country unless the appropriate settlement authority determines that the claimant is, and at the time of the incident was, friendly to the United States. A prisoner of war or an interned enemy alien is not excluded from bringing an otherwise payable claim for damage, loss, or destruction of personal property in the custody of the government.

    (h) A claim for damages or injury, which a receiving State should adjudicate and pay under an international agreement, unless a consistent and widespread alternative process of adjudicating and paying such claims has been established within the receiving State. See DA Pam 27-162, paragraph 3-4a, for further discussion of the conditions of waiver.

    (i) Claims listed in §§ 536.42, 536.43, 536.44, 536.45, and 536.46 of this part, except for the exclusion listed in § 536.45(k). Additionally, the exclusions in §§ 536.45(a), (b), (e) and (k) do not apply to a claim arising incident to noncombat activities.

    (j) Claims based on strict or absolute liability and similar theories.

    (k) Claims payable under subparts D or J of this part, or under AR 27-20, chapter 11.

    (l) Claims involving DA vehicles covered by insurance in accordance with requirements of a foreign country unless coverage is exceeded or the insurer is bankrupt. When an award is otherwise payable and an insurance settlement is not reasonably available, a field claims office should request permission from the Commander USARCS to pay the award, provided that an assignment of benefits is obtained.

    Applicable law for claims under the Military Claims Act.

    (a) General principles. (1) Tort claims excluding claims arising out of noncombat activities. (i) In determining liability, such claims will be evaluated Start Printed Page 46285under general principles of law applicable to a private individual in the majority of American jurisdictions, except where the doctrine of contributory negligence applies. The MCA requires that contributory negligence be interpreted and applied according to the law of the place of the occurrence, including foreign (local) law for claims arising in foreign countries (see 10 U.S.C. 2733(b)(4)).

    (ii) Claims are cognizable when based on those acts or omissions recognized as tortious by a majority of jurisdictions that require proof of duty, negligence, and proximate cause resulting in compensable injury or loss subject to the exclusions set forth at § 536.76. Strict or absolute liability and similar theories are not grounds for liability under this subpart.

    (2) Tort claims arising out of noncombat activities. Claims arising out of noncombat activities under §§ 536.75(a)(2) and (b) are not tort claims and require only proof of causation. However, the doctrine of contributory negligence will apply, to the extent set forth in 10 U.S.C. 2733(b)(4) and paragraph (a)(1)(i) of this section.

    (3) Principles applicable to all subpart C claims. (i) Interpretation of meanings and construction of questions of law under the MCA will be determined in accordance with federal law. The formulation of binding interpretations is delegated to the Commander USARCS, provided that the statutory provisions of the MCA are followed.

    (ii) Scope of employment will be determined in accordance with federal law. Follow guidance from reported FTCA cases. The formulation of a binding interpretation is delegated to the Commander USARCS, provided the statutory provisions of the MCA are followed.

    (iii) The collateral source doctrine is not applicable.

    (iv) The United States will only be liable for the portion of loss or damage attributable to the fault of the United States or its employees. Joint and several liability is inapplicable.

    (v) No allowance will be made for court costs, bail, interest, inconvenience or expenses incurred in connection with the preparation and presentation of the claim.

    (vi) Punitive or exemplary damages are not payable.

    (vii) Claims for negligent infliction of emotional distress may only be entertained when the claimant suffered physical injury arising from the same incident as the claim for emotional distress, or the claimant is the immediate family member of an injured party/decedent, was in the zone of danger and manifests physical injury for the emotional distress. Claims for intentional infliction of emotional distress will be evaluated under general principles of American law as set forth in paragraph (a)(1)(i) of this section and will be considered as an element of damages under paragraph (b)(3)(ii) of this section. Claims for either negligent or intentional infliction of emotional distress are excluded when they arise out of assault, battery, false arrest, false imprisonment, malicious prosecution, abuse of process, libel, or slander, as defined in § 536.45(h).

    (viii) In a claim for personal injury or wrongful death, the total award for non-economic damages to any direct victim and all persons, including those derivative to the claim, who claim injury by or through that victim will not exceed $500,000. However, separate claims for emotional distress considered under paragraph (b)(1) of this section are not subject to the $500,000 cap for the wrongful death claim as they are not included in the wrongful death claim; rather, each is a separate claim with its own $500,000 cap under paragraph (b)(3)(ii) of this section. Continuous or repeated exposure to substantially the same or similar harmful activity or conditions is treated as one incident for the purposes of determining the extent of liability. If the claim accrued prior to September 1, 1995, these limitations do not apply. Any such limitation in the law of the place of occurrence will apply.

    (b) Personal injury claims. (1) Eligible claimants. Only the following may claim:

    (i) Persons who suffer physical injuries or intentional emotional distress, but not subrogees (when claiming property loss or damage, medical expenses or lost earnings); see paragraph (a)(3)(iii) of this section.

    (ii) Spouses for loss of consortium, but not parent-child or child-parent loss of consortium;

    (iii) Members of the immediate family who were in the zone of danger of the injured person as defined in paragraph (a)(3)(vii) of this section.

    (2) Economic damages. Elements of economic damage are limited to the following:

    (i) Past expenses, including medical, hospital and related expenses actually incurred. Nursing and similar services furnished gratuitously by a family member are compensable. Itemized bills or other suitable proof must be furnished. Expenses paid by, or recoverable from, insurance or other sources are not recoverable.

    (ii) Future medical, hospital, and related expenses. When requested, a medical examination is required.

    (iii) Past lost earnings as substantiated by documentation from both the employer and a physician.

    (iv) Loss of earning capacity and ability to perform services, as substantiated by acceptable medical proof. When requested, past federal income tax forms must be submitted for the previous five years and the injured person must undergo an independent medical examination (IME). Estimates of future losses must be discounted to present value at a discount rate of one to three percent after deducting for income taxes. When a medical trust providing for all future care is established, personal consumption may be deducted from future losses.

    (v) Compensation paid to a person for essential household services that the injured person can no longer provide for himself or herself. These costs are recoverable only to the extent that they neither have been paid by, nor are recoverable from, insurance.

    (3) Non-economic damages. Elements of non-economic damages are limited to the following:

    (i) Past and future conscious pain and suffering. This element is defined as physical discomfort and distress as well as mental and emotional trauma. Loss of enjoyment of life, whether or not it is discernible by the injured party, is compensable. The inability to perform daily activities that one performed prior to injury, such as recreational activities, is included in this element. Supportive medical records and statements by health care personnel and acquaintances are required. When requested, the claimant must submit to an interview.

    (ii) Emotional distress. Emotional distress under the conditions set forth in paragraph (a)(3)(vii) of this section.

    (iii) Physical disfigurement. This element is defined as impairment resulting from an injury to a person that causes diminishment of beauty or symmetry of appearance rendering the person unsightly, misshapen, imperfect, or deformed. A medical statement and photographs, documenting claimant's condition, may be required.

    (iv) Loss of consortium. This element is defined as conjugal fellowship of husband and wife and the right of each to the company, society, cooperation, and affection of the other in every conjugal relation.

    (c) Wrongful death claims. The law of the place of the incident giving rise to the claim will apply to claims arising in the United States, its commonwealths, territories or possessions. Start Printed Page 46286

    (1) Claimant. (i) Only one claim may be presented for a wrongful death. It shall be presented by the decedent's personal representative on behalf of all parties in interest. The personal representative must be appointed by a court of competent jurisdiction prior to any settlement and must agree to make distribution to the parties in interest under court jurisdiction, if required.

    (ii) Parties in interest are the surviving spouse, children, or dependent parents to the exclusion of all other parties. If there is no surviving spouse, children, or dependent parents, the next of kin will be considered a party or parties in interest. A dependent parent is one who meets the criteria set forth by the Internal Revenue Service to establish eligibility for a DOD identification card.

    (2) Economic loss. Elements of economic damages are limited to the following:

    (i) Loss of monetary support of a family member from the date of injury causing death until expiration of decedent's worklife expectancy. When requested, the previous five years federal income tax forms must be submitted. Estimates must be discounted to present value at one to three percent after deducting for taxes and personal consumption. Loss of retirement benefits is compensable and similarly discounted after deductions.

    (ii) Loss of ascertainable contributions, such as money or gifts to other than family member claimants as substantiated by documentation or statements from those concerned.

    (iii) Loss of services from date of injury to end of life expectancy of the decedent or the person reasonably expected to receive such services, whichever is shorter.

    (iv) Expenses as set forth in paragraph (b)(2)(i) of this section. In addition, burial expenses are allowable. Expenses paid by, or recoverable from, insurance or other sources are not recoverable.

    (3) Non-economic loss. Elements of damages are limited to the following:

    (i) Pre-death conscious pain and suffering.

    (ii) Loss of companionship, comfort, society, protection, and consortium suffered by a spouse for the death of a spouse, a child for the death of a parent, or a parent for the death of a child.

    (iii) Loss of training, guidance, education, and nurture suffered by a child under the age of 18 for the death of a parent, until the child becomes 18 years old.

    (iv) Claims for the survivors' emotional distress, mental anguish, grief, bereavement, and anxiety are not payable, in particular claims for intentional or negligent infliction of emotional distress to survivors arising out of the circumstances of a wrongful death are personal injury claims falling under § 536.77(b)(3).

    (d) Property damage claims. The following provisions apply to all claims arising in the United States, its commonwealths, territories and possessions.

    (1) Such claims are limited to damage to, or loss of, tangible property and costs directly related thereto. Consequential damages are not included. (See § 536.50(e) and DA Pam 27-162, paragraph 2-56a.)

    (2) Proper claimants are described in § 536.27. Claims for subrogation are excluded. (See § 536.27(e)). However, there is no requirement that the claimant use personal casualty insurance to mitigate the loss.

    (3) Allowable elements of damages and measure of proof (additions to these elements are permissible with concurrence of the Commander USARCS). These elements are discussed in detail in DA Pam 27-162, paragraph 2-54.

    (i) Damages to real property.

    (ii) Damage to or loss of personal property, or personal property that is not economically repairable.

    (iii) Loss of use.

    (iv) Towing and storage charges.

    (v) Loss of business or profits.

    (vi) Overhead.

    Settlement authority for claims under the Military Claims Act.

    (a) Authority of the Secretary of the Army. The Secretary of the Army, the Army General Counsel, as the Secretary's designee, or another designee of the Secretary of the Army may approve settlements in excess of $100,000.

    (b) Delegations of authority. (1) Denials and final offers made under the delegations set forth herein are subject to appeal to the authorities specified in paragraph (d) of this section.

    (2) The Judge Advocate General (TJAG) and the Assistant Judge Advocate General (TAJAG) are delegated authority to pay up to $100,000 in settlement of a claim and to disapprove a claim regardless of the amount claimed.

    (3) The Commander USARCS is delegated authority to pay up to $25,000 in settlement of a claim and to disapprove or make a final offer in a claim regardless of the amount claimed.

    (4) The Judge Advocate (JA) or Staff Judge Advocate (SJA), subject to limitations that USARCS may impose, and chiefs of a command claims service are delegated authority to pay up to $25,000 in settlement, regardless of the amount claimed, and to disapprove or make a final offer in a claim presented in an amount not exceeding $25,000.

    (5) A head of an area claims office (ACO) is delegated authority to pay up to $25,000 in settlement of a claim, regardless of the amount claimed, and to disapprove or make a final offer in a claim presented in an amount not exceeding $25,000. A head of a claims processing office (CPO) with approval authority is delegated authority to approve, in full or in part, claims presented for $5,000 or less, and to pay claims regardless of the amount claimed, provided an award of $5,000 or less is accepted in full satisfaction of the claim.

    (6) Authority to further delegate payment authority is set forth in § 536.3(g)(1) of this part. For further discussions also related to approval, settlement and payment authority see also paragraph 2-69 of DA Pam 27-162.

    (c) Settlement of multiple claims arising from a single incident. (1) Where a single act or incident gives rise to multiple claims cognizable under this subpart, and where one or more of these claims apparently cannot be settled within the monetary jurisdiction of the authority initially acting on them, no final offer will be made. All claims will be forwarded, along with a recommended disposition, to the authority who has monetary jurisdiction over the largest claim for a determination of liability. However, where each individual claim, including derivative claims, can be settled within the monetary authority initially acting on them, and none are subject to denial, all such claims may be settled even though the total amount exceeds the monetary jurisdiction of the approving or settlement authority.

    (2) If such authority determines that federal liability is established, he or she may return claims of lesser value to the field claims office for settlement within that office's jurisdiction. The field claims office must take care to avoid compromising the higher authority's discretion by conceding liability in claims of lesser amount.

    (d) Appeals. Denials or final offers on claims described as follows may be appealed to the official designated:

    (1) For claims presented in an amount over $100,000, final decisions on appeals will be made by the Secretary of the Army or designee.

    (2) For claims presented for $100,000 or less, and any denied claim, regardless of the amount claimed, in which the denial was based solely upon an incident-to-service bar, exclusionary language in a federal statute governing compensation of federal employees for Start Printed Page 46287job-related injuries (see § 536.44), or untimely filing, TJAG or TAJAG will render final decisions on appeals, except that claims presented for $25,000 or less, and not acted upon by the Commander USARCS, are governed by paragraph (d)(3) of this section.

    (3) For claims presented for $25,000 or less, final decisions on appeals will be made by the Commander USARCS, his or her designee, or the chief of a command claims service when such claims are acted on by an ACO under such service's jurisdiction.

    (4) Sections 536.64, 536.65, and 536.66 of this part set forth the rules relating to the notification of appeal rights and processing.

    (e) Delegated authority. Authority delegated by this section will not be exercised unless the settlement or approval authority has been assigned an office code.

    Action on appeal under the Military Claims Act.

    (a) The appeal will be examined by the settlement authority who last acted on the claim, or his or her successor, to determine if the appeal complies with the requirements of this regulation. The settlement authority will also examine the claim file and decide whether additional investigation is required; ensure that all allegations or evidence presented by the claimant, agent, or attorney are documented; and ensure that all pertinent evidence is included. If claimants state that they appeal, but do not submit supporting materials within the 60-day appeal period or an approved extension thereof, these appeals will be determined on the record as it existed at the time of denial or final offer. Unless action under paragraph (b) of this section is taken, the claim and complete investigative file, including any additional investigation, and a tort claims memorandum will be forwarded to the appropriate appellate authority for necessary action on the appeal.

    (b) If the evidence in the file, including information submitted by the claimant with the appeal and that found by any necessary additional investigation, indicates that the appeal should be granted in whole or in part, the settlement authority who last acted on the claim, or his or her successor, will attempt to settle the claim. If a settlement cannot be reached, the appeal will be forwarded in accordance with paragraph (a) of this section.

    (c) As to an appeal that requires action by TJAG, TAJAG, or the Secretary of the Army or designee, the Commander USARCS may take the action in paragraph (b) of this section or forward the claim together with a recommendation for action. All matters submitted by the claimant will be forwarded and considered.

    (d) Since an appeal under this subpart is not an adversarial proceeding, no form of hearing is authorized. A request by the claimant for access to documentary evidence in the claim file to be used in considering the appeal will be granted unless law or regulation does not permit access.

    (e) If the appellate authority upholds a final offer or authorizes an award on appeal from a denial of a claim, the notice of the appellate authority's action will inform the claimant that he or she must accept the award within 180 days of the date of mailing of the notice of the appellate authority's action or the award will be withdrawn, the claim will be deemed denied, and the file will be closed without future recourse.

    Payment of costs, settlements, and judgments related to certain medical malpractice claims.

    (a) General. Costs, settlements, or judgments cognizable under 10 U.S.C. 1089(f) for personal injury or death caused by any physician, dentist, nurse, pharmacist, paramedic, or other supporting personnel (including medical and dental technicians, nurse assistants, therapists, and Red Cross volunteers of the Army Medical Department (AMEDD), AMEDD personnel detailed for service with other than a federal department, agency, or instrumentality and direct contract personnel identified in the contract as federal employees), will be paid provided that:

    (1) The alleged negligent or wrongful actions or omissions occurred during the performance of medical, dental, or related health care functions (including clinical studies and investigations) while the medical or health care employee was acting within the scope of employment.

    (2) Such personnel furnish prompt notification and delivery of all process served or received and other documents, information, and assistance as requested.

    (3) Such personnel cooperate in the defense of the action on its merits.

    (b) Requests for contribution or indemnification. All requests for contribution or indemnification under this section should be forwarded to the Commander USARCS for action, following the procedures set forth in this subpart.

    Payment of costs, settlements, and judgments related to certain legal malpractice claims.

    (a) General. Costs, settlements, and judgments cognizable under 10 U.S.C. 1054(f) for damages for personal injury or loss of property caused by any attorney, paralegal, or other member of a legal staff will be paid if:

    (1) The alleged negligent or wrongful actions or omissions occurred during the provision or performance of legal services while the attorney or legal employee was acting within the scope of duties or employment;

    (2) Such personnel furnish prompt notification and delivery of all process served or received and other documents, information, and assistance as requested;

    (3) Such personnel cooperate in the defense of the action on the merits.

    (b) Requests for contribution or indemnification. All requests for contribution or indemnification under this section should be forwarded to the Commander USARCS for action, following the procedures set forth in this subpart.

    Reopening an MCA claim after final action by a settlement authority.

    (a) Original approval or settlement authority (including TAJAG, TJAG, Secretary of the Army, or the Secretary's designees). (1) An original settlement authority may reconsider the denial of, or final offer on, a claim brought under the MCA upon request of the claimant or the claimant's authorized agent. In the absence of such a request, the settlement authority may on his or her initiative reconsider a claim.

    (2) An original approval or settlement authority may reopen and correct action on an MCA claim previously settled in whole or in part (even if a settlement agreement has been executed) when it appears that the original action was incorrect in law or fact based on the evidence of record at the time of the action or subsequently received. For errors in fact, the new evidence must not have been discoverable at the time of final action by either the Army or the claimant through the exercise of reasonable diligence. Corrective action may also be taken when an error contrary to the parties' mutual understanding is discovered in the original action. If the settlement or approval authority determines that their original action was incorrect, they will modify the action and, if appropriate, make a supplemental payment. The basis for a change in action will be stated in a memorandum included in the file. For example, a claim was settled for $15,000, but the settlement Start Printed Page 46288agreement was typed to read “$1,500” and the error is not discovered until the file is being prepared for payment. If appropriate, a corrected payment will be made. A settlement authority who has reason to believe that a settlement was obtained by fraud on the part of the claimant or claimant's legal representative will reopen action on that claim and, if the belief is substantiated, correct the action. The basis for correcting an action will be stated in a memorandum and included in the file.

    (b) A successor approval or settlement authority (including TAJAG, TJAG, Secretary of the Army, or the Secretary's designees). (1) Reconsideration. A successor approval or settlement authority may reconsider the denial of, or final offer on, an MCA claim upon request of the claimant or the claimant's authorized agent only on the basis of fraud, substantial new evidence, errors in calculation, or mistake (misinterpretation) of law.

    (2) Settlement correction. A successor approval or settlement authority may reopen and correct a predecessor's action on a claim that was previously settled in whole or in part for the same reasons that an original authority may do so.

    (c) Time requirement for filing request for reconsideration. Requests postmarked more than five years from the date of mailing of final notice will be denied based on the doctrine of laches.

    (d) Finality of action. Action by the appropriate authority (either affirming the prior action or granting full or granting full or partial relief) is final under the provisions of 10 U.S.C. 2735. Action upon a request for reconsideration constitutes final administrative disposition of a claim. No further requests for reconsideration will be allowed except on the basis of fraud.

    Subpart D—Claims Cognizable Under the Federal Tort Claims Act

    Statutory authority for the Federal Tort Claims Act.

    The statutory authority for this subpart is the Federal Tort Claims Act (FTCA) (60 Stat. 842, 28 U.S.C. 2671-2680), as amended by Public Law 89-506, July 1966 (80 Stat. 306); Public Law 93-253, March 1974 (88 Stat. 50); Public Law 97-124, December 1981 (93 Stat. 1666); Public Law 100-694, November 1988 (102 Stat. 4563-67); and Public Law 101-552, November 1996 (104 Stat. 734); and as implemented by the Attorney General's Regulations (28 CFR 14.1 through 14.11 and its Appendix), all of which are posted on the USARCS Web site; for the address see § 536.2(a).

    Scope for claims under the Federal Tort Claim Act.

    (a) General. This subpart applies in the United States, its commonwealths, territories and possessions (all hereinafter collectively referred to as United States or U.S.). It prescribes the substantive bases and special procedural requirements under the FTCA and the implementing Attorney General's regulations for the administrative settlement of claims against the United States based on death, personal injury, or damage to, or loss of, property caused by negligent or wrongful acts or omissions by the United States or its employees acting within the scope of their employment. If a conflict exists between this part and the Attorney General's regulations, the latter governs.

    (b) Effect of the Military Claims Act. A tort claim arising in the United States, its commonwealths, territories, and possessions may be settled under subpart C of this part if the Federal Tort Claims Act (FTCA) does not apply to the type of claim under consideration or if the claim arose incident to noncombat activities. If a claim is filed under both the FTCA and the Military Claims Act (MCA), or when both statutes apply equally, final action thereon will follow the procedures set forth in DA Pam 27-162, paragraphs 2-74 through 2-76, discussing final offers and denial letters.

    Claims payable under the Federal Tort Claims Act.

    (a) Unless otherwise prescribed, claims for death, personal injury, or damage to, or loss of, property (real or personal) are payable under this subpart when the injury or damage is caused by negligent or wrongful acts or omissions of military personnel or civilian employees of the Department of the Army or Department of Defense while acting within the scope of their employment under circumstances in which 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. The FTCA is a limited waiver of sovereign immunity without which the United States may not be sued in tort. Similarly, neither the Fifth Amendment nor any other provision of the U.S. Constitution creates or permits a federal cause of action allowing recovery in tort. Immunity must be expressly waived, as the FTCA waives it.

    (b) To be payable, a claim must arise from the acts or omissions of an “employee of the government” under 28 U.S.C. 2671. Categories of such employees are listed in § 536.23(b) of this part.

    Claims not payable under the Federal Tort Claims Act.

    A claim is not payable if it is identified as an exclusion in DA Pam 27-162, paragraphs 2-36 through 2-43.

    Applicable law for claims under the Federal Tort Claims Act.

    The applicable law for claims falling under the Federal Tort Claims Act is set forth in §§ 536.41 through 536.52.

    Settlement authority for claims under the Federal Tort Claims Act.

    (a) General. Subject to the Attorney General's approval of payments in excess of $200,000 for a single claim, or if the total value of all claims and potential claims arising out of a single incident exceeds $200,000 (for which USARCS must write an action memorandum for submission to the Department of Justice), the following officials are delegated authority to settle (including payment in full or in part, or denial) and make final offers on claims under this subpart:

    (1) The Judge Advocate General (TJAG);

    (2) The Assistant Judge Advocate General (TAJAG); and

    (3) The Commander USARCS.

    (b) ACO heads. A head of an area claims office (ACO) is delegated authority to pay up to $50,000 in settlement of a claim, regardless of the amount claimed, and to disapprove or make a final offer in a claim presented in an amount not exceeding $50,000, provided the value of all claims and potential claims arising out of a single incident does not exceed $200,000.

    (c) CPO heads. A head of a claims processing office (CPO) with approval authority is delegated authority to approve, in full or in part, claims presented for $5,000 or less, and to pay claims regardless of amount, provided an award of $5000 or less is accepted in full satisfaction of the claim.

    (d) Further guidance. Authority to further delegate payment authority is set forth in § 536.3(g)(1) of this part. For further discussions related to approval, settlement and payment authority see paragraphs 2-69 and 2-71 of DA Pam 27-162.

    (e) Settlement of multiple claims from a single incident. (1) Where a single act or incident gives rise to multiple claims cognizable under this subpart, and where one claim cannot be settled within the monetary jurisdiction for one claim of the authority acting on the claim or all claims cannot be settled within the monetary jurisdiction for a Start Printed Page 46289single incident, no final offer will be made. All claims will be forwarded, along with a recommended disposition, to the Commander USARCS.

    (2) If the Commander USARCS determines that all claims can be settled for a total of $200,000 or less, he may return claims to the field office for settlement. If the Commander USARCS, determines that all claims cannot be settled for a total of $200,000, he must request Department of Justice authority prior to settlement of any one claim. The field claims office must not concede liability by paying any one claim of lesser value.

    Reconsideration of Federal Tort Claims Act claims.

    (a) Reconsideration of paid claims. Under the provision of 28 U.S.C. 2672, neither an original or successor authority may reconsider a claim which has been paid except as expressly set forth below. Payment of an amount for property damage will bar payment for personal injury or death except for a split claim provided the provisions of § 536.60 are followed. Supplemental payments for either property or injury are barred by 10 U.S.C. 2672. Accordingly, claimants will be informed that only one claim or payment is permitted.

    (b) Notice of right to reconsideration. Notice of disapproval or final offer issued by an authority listed in § 536.88(b) will advise the claimant of a right to reconsideration to be submitted in writing not later than six months from the date of mailing the notice. Such a request will suspend the requirement to bring suit for a minimum of six month or until action is taken on the request. The claimant will be so informed. See the Attorney General's Regulations at 28 CFR 14.9(b), posted on the USARCS Web site; for the address see § 536.2(a).

    (c) Original approval or settlement authority. (1) Reconsideration. An original settlement authority may reconsider the denial of, or final offer on, a claim brought under the FTCA upon request of the claimant or the legal representative.

    (2) Settlement correction. An original approval or settlement authority may reopen and correct action on a claim previously settled in whole or in part (even if a settlement agreement has been executed) when an error contrary to the parties' mutual understanding is discovered in the original action. For example: a claim was settled for $15,000, but the settlement agreement was typed to read “$1,500” and the error is not discovered until the file is being prepared for payment. If appropriate, a corrected payment will be made. An approval or settlement authority who has reason to believe that a settlement was obtained by fraud on the part of the claimant or claimant's legal representative will reopen action on that claim, and if the belief is substantiated, correct the action. The basis for correcting an action will be stated in a memorandum and included in the file.

    (d) A successor approval or settlement authority. (1) Reconsideration. A successor approval or settlement authority may reconsider the denial of, or final offer on, an FTCA claim upon request of the claimant, the claimant's authorized agent, or the claimant's legal representative only on the basis of fraud, substantial new evidence, errors in calculation, or mistake (misinterpretation) of law.

    (2) Settlement correction. A successor approval or settlement authority may reopen and correct a predecessor's action on a claim that was previously settled in whole or in part for the same reasons that an original authority may do so.

    (e) Requirement to forward a request for reconsideration. When full relief is not granted, forward all requests for reconsideration of an ACO's denial or final offer to the Commander USARCS for action. Include all investigative material and legal analyses generated by the request.

    (f) Action prior to forwarding. A request for reconsideration should disclose fully the legal and/or factual bases that the claimant has asserted as grounds for relief and provide appropriate supporting documents or evidence. Following completion of any investigation or other action deemed necessary for an informed disposition of the request, the approval or settlement authority will reconsider the claim and attempt to settle it, granting relief as warranted. When further settlement efforts appear unwarranted, the entire file with a memorandum of opinion will be forwarded to the Commander USARCS. The claimant will be informed of such transfer.

    (g) Finality of action. Action by the appropriate authority (either affirming the prior action or granting full or partial relief) upon a request for reconsideration constitutes final administrative disposition of a claim. No further requests for reconsideration will be allowed except on the basis of fraud. Attempted further requests for reconsideration on other grounds will not toll the six-month period set forth in 28 U.S.C. 2401(b).

    Subpart E—Claims Cognizable Under the Non-Scope Claims Act

    Statutory authority for the Non-Scope Claims Act.

    The statutory authority for this subpart is set forth in the Act of October 1962, 10 U.S.C. 2737, 76 Stat. 767, commonly called the “Non-Scope Claims Act (NSCA).”

    Scope for claims under the Non-Scope Claims Act.

    (a) This subpart applies worldwide and prescribes the substantive bases and special procedural requirements for the administrative settlement and payment of not more than $1,000 for any claim against the United States for personal injury, death or damage to, or loss of, property caused by military personnel or civilian employees, incident to the use of a U.S. vehicle at any location, or incident to the use of other U.S. property on a government installation, which claim is not cognizable under any other provision of law.

    (b) For the purposes of this subpart, a “government installation” is a facility having fixed boundaries owned or controlled by the government, and a “vehicle” includes every description of carriage or other artificial contrivance used, or capable of being used, as means of transportation on land (1 U.S.C. 4).

    (c) Any claim in which there appears to be a dispute about whether the employee was acting within the scope of employment will be considered under subparts C, D, or F of this part. Only when all parties, including an insurer, agree that there is no “in scope” issue will the claim be considered under this subpart.

    Claims payable under the Non-Scope Claims Act.

    (a) General. A claim for personal injury, death, or damage to, or loss of, property, real or personal, is payable under this subpart when:

    (1) Caused by negligent or wrongful acts or omissions of Department of Defense or Department of the Army (DA) military personnel or civilian employees, as listed in § 536.23(b):

    (i) Incident to the use of a vehicle belonging to the United States at any place or;

    (ii) Incident to the use of any other property belonging to the United States on a government installation.

    (2) The claim is not payable under any other claims statute or regulation available to the DA for the administrative settlement of claims.

    (b) Personal injury or death. A claim for personal injury or death is allowable only for the cost of reasonable medical, Start Printed Page 46290hospital, or burial expenses actually incurred and not otherwise furnished or paid by the United States.

    (c) Property loss or damage. A claim for damage to or loss of property is allowable only for the cost of reasonable repairs or value at time of loss, whichever is less.

    Claims not payable under the Non-Scope Claims Act.

    Under this subpart, a claim is not payable that:

    (a) Results in whole or in part from the negligent or wrongful act of the claimant or his or her agent or employee. The doctrine of comparative negligence does not apply.

    (b) Is for medical, hospital, or burial expenses furnished or paid by the United States.

    (c) Is for any element of damage pertaining to personal injuries or death other than as provided in § 536.93(b). All other items of damage, for example, compensation for loss of earnings and services, diminution of earning capacity, anticipated medical expenses, physical disfigurement and pain and suffering are not payable.

    (d) Is for loss of use of property or for the cost of substitute property, for example, a rental.

    (e) Is legally recoverable by the claimant under an indemnifying law or indemnity contract. If the claim is in part legally recoverable, the part recoverable by the claimant is not payable.

    (f) Is a subrogated claim.

    (g) In some circumstances some claims may be partially payable. See DA Pam 27-162, paragraph 5-4 for more information on claims that may be partially payable.

    Settlement authority for claims under the Non-Scope Claims Act.

    (a) Settlement authority. The following are delegated authority to pay up to $1,000 in settlement of each claim arising out of one incident and to disapprove a claim presented in any amount under this subpart:

    (1) The Judge Advocate General (TJAG);

    (2) The Assistant Judge Advocate General (TAJAG);

    (3) The Commander USARCS;

    (4) The Judge Advocate (JA) or Staff Judge Advocate (SJA) or chief of a command claims service; and

    (5) The head of an area claims office (ACO).

    (b) Approval authority. The head of a claims processing office (CPO) with approval authority is delegated authority to approve and pay, in full or in part, claims presented for $1,000 or less and to compromise and pay, regardless of amount claimed, an agreed award of $1,000 or less.

    (c) Further guidance. Authority to further delegate payment authority is set forth in § 536.3(g)(1) of this part. For further discussions also related to approval, settlement and payment authority see also paragraphs 2-69 and 2-71 of DA Pam 27-162.

    Reconsideration of Non-Scope Claims Act claims.

    The provisions of § 536.89 addressing reconsideration apply and are incorporated herein by reference. If the claim is not cognizable under the Federal Tort Claims Act, appellate procedures under the Military Claims Act or NGCA apply.

    Subpart F—Claims Cognizable Under the National Guard Claims Act

    Statutory authority for the National Guard Claims Act.

    The statutory authority for this subpart is contained in the Act of September 1960 (32 U.S.C. 715, 74 Stat. 878), commonly referred to as the “National Guard Claims Act” (NGCA), as amended by Public Law 87-212, (75 Stat. 488), September 1961; Public Law 90-486, (82 Stat. 756), August 1968; Public Law 90-521, (82 Stat. 874), September 1968; Public Law 90-525, (82 Stat. 877), September 1968; Public Law 91-312, (84 Stat. 412), July 1970; Public Law 93-336, (88 Stat. 291), July 1974; and Public Law 98-564, (98 Stat. 2918), October 1984.

    Scope for claims under National Guard Claims Act.

    This subpart applies worldwide and prescribes the substantive bases and special procedural regulations for the settlement of claims against the United States for death, personal injury, damage to, or loss or destruction of property.

    (a) Soldiers of the Army National Guard (ARNG) can perform military duty in an active duty status under the authority of Title 10 of the United States Code, in a full-time National Guard duty or inactive-duty training status under the authority of Title 32 of the United States Code, or in a state active duty status under the authority of a state code.

    (1) When ARNG soldiers perform active duty, they are under federal command and control and are paid from federal funds. For claims purposes, those soldiers are treated as active duty soldiers. The NGCA, 32 U.S.C. 715, does not apply.

    (2) When ARNG soldiers perform full-time National Guard duty or inactive-duty training, they are under state command and control and are paid from federal funds. The NGCA does apply, but as explained in paragraph (c) of this section it is seldom used.

    (3) When ARNG soldiers perform state active duty, they are under state command and control and are paid from state funds. Federal claims statutes do not apply, but state claims statutes may apply.

    (b) The ARNG also employs civilians, referred to as technicians and employed under 32 U.S.C. 709. Technicians are usually, but not always, ARNG soldiers who perform the usual 15 days of annual training (a category of full-time duty) and 48 drills (inactive-duty training) per year.

    (c) NGCA coverage applies only to ARNG soldiers performing full-time National Guard duty or inactive-duty training and to technicians. However, since the NGCA's enactment in 1960, Congress has also extended Federal Tort Claims Act (FTCA) coverage to these personnel.

    (1) In 1968, technicians, who were state employees formerly, were made federal employees. Along with federal employee status came FTCA coverage. Technicians no longer have any state status, albeit they are hired, fired, and administered by a state official, the Adjutant General, acting as the agent of the federal government.

    (2) In 1981, Congress extended FTCA coverage to ARNG soldiers performing full-time National Guard duty or inactive-duty training (such as any training or other duty under 32 U.S.C. 316, 502-505). Unlike making technicians federal employees, this extension of coverage did not affect their underlying status as state military personnel.

    (d) Claims arising from the negligent acts or omissions of ARNG soldiers performing full-time National Guard duty or inactive-duty training, or of technicians, will be processed under the FTCA. Therefore, the NGCA is generally relevant only to claims arising from noncombat activities or outside the United States. Additionally, claims by members of the National Guard may be paid for property loss or damage incident to service if the claim is based on activities falling under this subpart and is not payable under AR 27-20, chapter 11.

    Claims payable under the National Guard Claims Act.

    The provisions of § 536.75 apply to claims arising under this subpart.

    Start Printed Page 46291
    Claims not payable under the National Guard Claims Act.

    The provisions of § 536.76 apply to claims arising under this subpart.

    Applicable law for claims under the National Guard Claims Act.

    The provisions of § 536.77 apply to claims arising under this subpart.

    Settlement authority for claims under the National Guard Claims Act.

    The provisions of § 536.78 apply to claims arising under this subpart.

    Actions on appeal under the National Guard Claims Act.

    The provisions of § 536.79 apply to claims arising under this subpart.

    Subpart G—Claims Cognizable Under International Agreements

    Statutory authority for claims cognizable under international claims agreements.

    The authority for claims presented or processed under this subpart is set forth in the following federal laws and bi- or multinational agreements:

    (a) 10 U.S.C. 2734a and 10 U.S.C. 2734b (the International Agreements Claims Act) as amended, for claims arising overseas under international agreements.

    (b) Various international agreements, such as the North Atlantic Treaty Organization (NATO) Status of Forces Agreement (SOFA) and the Partnership for Peace (PFP) SOFA.

    Current agreements in force.

    Current listings of known agreements in force are also posted on the USARCS Web site; for the address see § 536.2(a).

    Responsibilities generally/international agreements claims.

    (a) The Commander USARCS is responsible for:

    (1) Providing policy guidance to command claims services or other responsible judge advocate (JA) offices on SOFA or other treaty reimbursement programs implementing 10 U.S.C. 2734a and 2734b.

    (2) Monitoring the reimbursement system to ensure that programs for the proper verification and certification of reimbursement are in place.

    (3) Monitoring funds reimbursed to or by foreign governments.

    (b) Responsibilities in the continental United States (CONUS)—The responsibility for implementing these agreements within the United States has been delegated to the Secretary of the Army (SA). The SA, in turn, has delegated that responsibility to the Commander USARCS, who is in charge of the receiving State office for the United States, as prescribed in DODD 5515.8. The Commander USARCS is responsible for maintaining direct liaison with sending State representatives and establishing procedures designed to carry out the provisions of this subpart.

    Definitions for international agreements claims.

    (a) “Force and civilian component of force.” Members of the sending State's armed forces on temporary or permanent official duty within the receiving State, civilian employees of the sending State's armed forces, and those individuals acting in an official capacity for the sending State's armed forces. However, under provisions of the applicable SOFAs the sending State and the receiving State may agree to exclude from the definition of “force” certain individuals, units or formations that would otherwise be covered by the SOFA. Where such an exclusion has been created, this subpart will not apply to claims arising from actions or omission by those individuals, units or formations. “Force and civilian component of force” also includes claims arising out of acts or omissions made by military or civilian personnel, regardless of nationality, who are assigned or attached to, or employed by, an international headquarters established under the provisions of the Protocol on the Status of International Military Headquarters Set Up Pursuant to the North Atlantic Treaty, dated August 28, 1952, such as Supreme Allied Command, Atlantic.

    (b) Types of claims under agreements. (1) Intergovernmental claims. Claims of one contracting party against any other contracting party for damage to property owned by its armed services, or for injury or death suffered by a member of the armed services engaged in the performance of official duties, are waived. Claims above a minimal amount for damage to property owned by a governmental entity other than the armed services may be asserted. NATO SOFA, Article VIII, paragraph 1-4; Singapore SOFA, Article XVI, paragraph 2-3.

    (2) Third-party scope claims. Claims arising out of any acts or omissions of members of a force or the civilian component of a sending State done in the performance of official duty or any other act, omission, or occurrence for which the sending State is legally responsible shall be filed, considered and settled in accordance with the laws and regulations of the receiving State with respect to claims arising from the activities of its own armed service; see, for example, NATO SOFA, Article VIII, paragraph 5.

    (3) Ex gratia claims. Claims arising out of tortious acts or omissions not done in the performance of official duties shall be considered by the sending State for an “ex gratia” payment that is made directly to the injured party; see, for example, NATO SOFA, Article VIII, paragraph 6.

    Scope for international agreements claims arising in the United States.

    This section sets forth procedures and responsibilities for the investigation, processing, and settlement of claims arising out of any acts or omissions of members of a foreign military force or civilian component present in the United States or a territory, commonwealth, or possession thereof under the provisions of cost sharing reciprocal international agreements which contain claims settlement provisions applicable to claims arising in the United States. Article VIII of the NATO SOFA has reciprocal provisions applying to all NATO member countries; the Partnership for Peace (PFP) Agreement has similiar provisions, as do the Singapore and Australian SOFAs.

    Claims payable under international agreements (for those arising in the United States).

    (a) Within the United States, Art. VIII, NATO SOFA applies to claims arising within the North Atlantic Treaty Area, which includes CONUS and its territories and possessions north of the Tropic of Cancer (23.5 degrees north latitude). This excludes Puerto Rico, the Virgin Islands, and parts of Hawaii. Third-party scope claims are payable under subpart D or, if the claim arises incident to noncombat activities, under subpart C of this part. Maritime claims are payable under subpart H of this part. The provisions of these subparts on what claims are payable apply equally here. The members of the foreign force or civilian component must be acting in pursuance of the applicable treaty's objectives.

    (b) Within the United States, third-party ex gratia claims are payable only by the sending State and are not payable under subpart E of this part.

    Claims not payable under international agreements (for those arising in the United States).

    The following claims are not payable:

    (a) Claims arising from a member of a foreign force or civilian component's acts or omissions that do not accord with the objectives of a treaty Start Printed Page 46292authorizing their presence in the United States.

    (b) Claims arising from the acts or omissions of a member of a foreign force or civilian component who has been excluded from SOFA coverage by agreement between the sending State and the United States.

    (c) Third-party scope claims arising within the United States that are not payable under subparts C, D, or H of this part are listed as barred under those subparts. As sending State forces are considered assimilated into the U.S. Armed Services for purposes of the SOFAs, their members are also barred from receiving compensation from the United States when they are injured incident to their service, Daberkow v. United States, 581 F.2d 785 (9th Cir. 1978).

    Notification of incidents arising under international agreements (for claims arising in the United States).

    To enable USARCS to properly discharge its claims responsibilities under the applicable SOFAs, it must be notified of all incidents, including off-duty incidents, in which members of a foreign military force or civilian component are involved. Any member or employee of the U.S. armed services who learns of an incident involving a member of a foreign military force or civilian component resulting in personal injury, death, or property damage will immediately notify the judge advocate (JA) or legal officer at the installation or activity to which such person is assigned or attached. The JA or legal officer receiving such notification will in turn notify the Commander USARCS. If the member is neither assigned nor attached to any installation or activity within the United States, the Commander USARCS, will be notified.

    Investigation of claims arising under international agreements (for those claims arising in the United States).

    Responsibility for investigating an incident rests upon the area claims office (ACO) or claims processing office (CPO) responsible for the geographic area in which the incident occurred. The Commander USARCS, an ACO, and a CPO are authorized to designate the legal office of the installation at which the member of the foreign force or civilian component is attached, including the legal office of another armed force, to carry out the responsibility to investigate. The investigation will comply with the responsible Service's implementing claims regulation. When the member is neither assigned nor attached within the United States, the Commander USARCS will furnish assistance.

    Settlement authority for claims arising under international agreements (for those claims arising in the United States).

    Settlement authority is delegated to the Commander USARCS, except for settlement amounts exceeding the Commander's authority as set forth in subparts C, D, or H of this part, or in those cases where settlement is reserved to a higher authority. Pursuant to the applicable SOFA, the Commander USARCS will report the proposed settlement to the sending State office for concurrence or objection. See, for example, NATO SOFA, Article VIII.

    Assistance to foreign forces for claims arising under international agreements (as to claims arising in the United States).

    All claims arising from activities of members of NATO, Partnership for Peace, Singaporean, or Australian forces in the United States are processed in the same manner as those arising from activities of U.S. government personnel. All JAs and legal offices will provide assistance similar to that provided to U.S. armed services personnel.

    Scope for claims arising overseas under international agreements.

    (a) This section sets forth guidance on claims arising from any act or omission of soldiers or members of the civilian component of the U.S. armed services done in the performance of official duty or arising from any other act or omission or occurrence for which the U.S. armed services are responsible under an international agreement. Claims incidents arising in countries for which the SOFA requires the receiving State to adjudicate and pay the claims in accordance with its laws and regulations are subject to partial reimbursement by the United States.

    (b) Claims by foreign inhabitants based on acts or omissions outside the scope of official duties are cognizable under subpart J of this part. Claims arising from nonscope acts or omissions by third parties who are not foreign inhabitants are cognizable under subpart E but not under subparts C or F of this part.

    Claims procedures for claims arising overseas under international agreements.

    (a) SOFA provisions that call for the receiving State to adjudicate claims have been held to be the exclusive remedy for claims against the United States, Aaskov v. Aldridge, 695 F. Supp. 595 (D.D.C. 1988); Dancy v. Department of Army, 897 F. Supp. 612 (D.D.C. 1995).

    (b) SOFA provisions that call for the receiving State to adjudicate claims against the United States usually refer to claims by third parties brought against members of the force or civilian component. This includes claims by tourists or business travelers as well as inhabitants of foreign countries. Depending on how the receiving State interprets the particular SOFA's class of proper claimants, the receiving State may also consider claims by U.S. soldiers, civilian employees, and their family members. Chiefs of command claims services or other Army JA offices responsible for claims that arise in countries bound by SOFA or other treaty provisions requiring a receiving State to consider claims against the United States will ensure that all claims personnel know the receiving State's policy on which persons or classes of persons are proper claimants under such provisions. When a claim is filed both with the receiving State and under either the Military Claims Act (MCA) or Foreign Claims Act (FCA), the provisions of § 536.76(h) of this part and DA Pam 27-162, paragraph 3-4a apply.

    (c) When SOFA provisions provide for receiving State claims consideration, the time limit for filing such claims may be much shorter than the two years otherwise allowed under the FCA or MCA. For example, receiving State claims offices in Germany require that a claim be filed under the SOFA within three months of the date that the claimant is aware of the U.S. involvement. If the filing period is about to expire for claims arising in Germany, have the claimant fill out a claim form, make two copies, and date-stamp each copy as received by a sending State claims office. Return the date-stamped original of the claim to the claimant with instructions to promptly file with the receiving State claims office. Keep one date-stamped copy as a potential claim. Forward one date-stamped copy of the claim to the U.S. Army Claims Service Europe (USACSEUR). This may toll the applicable German statute of limitations. Additionally, many receiving State claims offices do not require claimants to demand a sum certain. All claims personnel must familiarize themselves with the applicable receiving State law and procedures governing SOFA claims.

    (d) All foreign inhabitants who file claims against the United States that fall within the receiving State's responsibility, such as claims based on acts or omissions within the scope of U.S. Armed Forces members' or civilian employees' duties, must file the claim Start Printed Page 46293with the appropriate receiving State office. Those U.S. inhabitants whose claims would be otherwise cognizable under the Military Claims Act (subpart C of this part) and whom the receiving State deems proper claimants under the SOFA must also file with the receiving State.

    (e) A claim filed with, and considered by, a receiving State under a SOFA or other international agreement claims provision may be considered under other subparts of this part only if the receiving State denied the claim on the basis that it was not cognizable under the treaty or agreement provisions. See DA Pam 27-162, paragraph 3-4a(2), for conditions of waiver of the foregoing requirement. See also §§ 536.76(h) and 536.138(j) of this part. When a claimant has filed a claim with a receiving State and received payment, or the claim has been denied on the merits, such action will be the claimant's final and exclusive remedy and will bar any further claims against the United States.

    Responsibilities as to claims arising overseas under international agreements.

    (a) Command claims services or other responsible JA offices within whose jurisdiction SOFA or other treaty provisions provide for a claim reimbursement system, and where DA has been assigned single-service responsibility for the foreign country seeking reimbursement (see § 536.17) are responsible for:

    (1) Establishing programs for verifying, certifying, and reimbursing claims payments. Such service or JA office will provide a copy of its procedures implementing the program to the Commander USARCS.

    (2) Providing the Commander USARCS with budget estimates for reimbursements in addition to the reports required by AR 27-20, paragraph 13-7.

    (3) Providing the Commander USARCS each month in which payments are made, with statistical information on the number of individual claims reimbursed, the total amount paid by the foreign government, and the total amount reimbursed by the United States.

    (4) Providing the Commander USARCS with a quarterly report showing total reimbursements paid during the quarter for maneuver damage and tort claims classified according to major categories of damage determined by the Commander USARCS, and an update on major issues or activities that could affect the reimbursement system's operation or funding.

    (b) Command claims services or other responsible Army JA offices will ensure that all claims personnel within their areas of responsibility:

    (1) Receive annual training on the receiving State's claims procedures, including applicable time limitations, procedures and the responsible receiving State claims offices' locations.

    (2) Screen all new claims and inquiries about claims to identify those claimants who must file with the receiving State.

    (3) Ensure that all such claimants are informed of this requirement and the applicable time limitation.

    (4) Ensure that all applicable SOFA claims based on incidents occurring in circumstances that bring them within the United States' primary sending State jurisdiction are fully investigated.

    Subpart H—Maritime Claims

    Statutory authority for maritime claims.

    The Army Maritime Claims Settlement Act (AMCSA) (10 U.S.C. 4801-04, 4806, as amended) authorizes the Secretary of the Army or his designee to administratively settle or compromise admiralty and maritime claims in favor of, and against, the United States.

    Related statutes for maritime claims.

    (a) The AMCSA permits the settlement of claims that would ordinarily fall under the Suits in Admiralty Act (SIAA), 46 U.S.C. app. 741-752; the Public Vessels Act (PVA), 46 U.S.C. app. 781-790; or the Admiralty Extension Act (AEA), 46 U.S.C. app. 740. Outside the United States the AMCSA may be used to settle admiralty claims in lieu of the Military Claims Act or Foreign Claims Act. Within the United States, filing under the AMCSA is not mandatory for causes of action as it is for the SIAA or PVA.

    (b) Similar maritime claims settlement authority is exercised by the Department of the Navy under 10 U.S.C. 7363 and 7621-23 and by the Department of the Air Force under 10 U.S.C. 9801-9804 and 9806.

    Scope for maritime claims.

    The AMCSA applies worldwide and includes claims that arise on high seas or within the territorial waters of a foreign country. At 10 U.S.C. 4802 it provides for the settlement or compromise of claims for:

    (a) Damage caused by a vessel of, or in the service of, the Department of Army (DA) or by other property under the jurisdiction of the DA.

    (b) Compensation for towage and salvage service, including contract salvage, rendered to a vessel of, or in the service of, the DA or other property under the jurisdiction of the DA.

    (c) Damage that is maritime in nature and caused by tortious conduct of U.S. military personnel or federal civilian employees, an agent thereof, or property under the Army's jurisdiction.

    Claims payable as maritime claims.

    A claim is cognizable under this subpart if it arises in or on a maritime location, involves some traditional maritime nexus or activity, and is caused by the wrongful act or omission of a member of the U.S. Army, Department of Defense (DOD) or DA civilian employee, or an agent thereof, while acting within the scope of employment. This class of claims includes, but is not limited to:

    (a) Damage to a ship, boat, barge, or other watercraft;

    (b) An injury that involves a ship, boat, barge, or other watercraft;

    (c) Damage to a wharf, pier, jetty, fishing net, farm facilities or other structures in, on, or adjacent to any body of water;

    (d) Damage or injury on land or on water arising under the AEA and allegedly due to operation of an Army-owned or leased ship, boat, barge, or other watercraft;

    (e) An injury that occurs on board an Army ship, boat, barge or other watercraft; and

    (f) Crash into water of an Army aircraft.

    Claims not payable as maritime claims.

    Under this subpart, claims are not payable if they:

    (a) Are listed in §§ 536.42, 536.43, 536.44, 536.45 (except at (e) and (k)), and 536.46;

    (b) Are not maritime in nature;

    (c) Are not in the best interests of the United States, are contrary to public policy, or are otherwise contrary to the basic intent of the governing statute, for example, claims for property loss or damage or personal injury or death by inhabitants of unfriendly foreign countries or by individuals considered to be unfriendly to the United States. When a claim is considered not payable for the reasons stated in this section, it will be forwarded for appropriate action to the Commander USARCS, along with the recommendations of the responsible claims office.

    (d) Are presented by a national, or a corporation controlled by a national, of a country at war or engaged in armed Start Printed Page 46294conflict with the United States, or any country allied with such enemy country, unless the appropriate settlement authority determines that the claimant is and, at the time of incident, was friendly to the United States. A prisoner of war or an interned enemy alien is not excluded or barred from bringing a claim for damage, loss, or destruction of personal property while held in the custody of the government if the claim is otherwise payable.

    (e) Are for damages or injuries that a receiving State should pay for under an international agreement. See § 536.34(c).

    Limitation of settlement of maritime claims.

    (a) Within the United States the period of completing an administrative settlement under the AMCSA is subject to the same time limitation as that for beginning suit under the SIAA or PVA; that is, a two-year period from the date the cause of the action accrued. The claimant must have agreed to accept the settlement and it must be approved for payment by the Secretary of the Army or other approval authority prior to the end of such period. The presentation of a claim, or its consideration by the DA, neither waives nor extends the two-year limitation period and the claimant should be so informed, in writing, when the claim is acknowledged. See § 536.28.

    (b) For causes of action under the AEA, filing an administrative claim is mandatory. However, suit is required under the two-year time limit applicable to the SIAA and PVA, even though the AEA provides that no suit shall be filed under six months after filing a claim.

    (c) For causes of action arising outside the United States, there is no time limitation for completing an administrative settlement.

    Limitation of liability for maritime claims.

    For admiralty claims arising within the United States under the provisions of the Limitation of Shipowners' Liability Act, 46 U.S.C. app. 181-188, in cases alleging injury or loss due to negligent operation of its vessel, the United States may limit its liability to the value of its vessel after the incident from which the claim arose. The act requires filing of an action in federal District Court within six months of receiving written notice of a claim. Therefore, USARCS, or the Chief Counsel, U.S. Army Corps of Engineers (COE), or his designee, must be notified within 10 working days of the receipt of any maritime claim arising in the United States or on the high seas out of the operation of an Army vessel, including pleasure craft owned by the United States. USARCS or Chief Counsel, COE will coordinate with the Department of Justice (DOJ) as to whether to file a limitation of liability action.

    Settlement authority for maritime claims.

    (a) The Secretary of the Army, the Army General Counsel as designee of the Secretary, or other designee of the Secretary may approve any settlement or compromise of a claim in any amount. A claim settled or compromised in a net amount exceeding $500,000 will be investigated and processed and, if approved by the Secretary of the Army or his or her designee, will be certified to Congress for final approval.

    (b) The Judge Advocate General (TJAG), The Assistant Judge Advocate General (TAJAG), the Commander USARCS, the Chief Counsel COE, or Division or District Counsel Offices are delegated authority to settle, such as to deny or approve payment in full or in part, any claim under this subpart regardless of the amount claimed, provided that any award does not exceed $100,000.

    (c) A Staff Judge Advocate (SJA) or chief of a command claims service and heads of area claims offices (ACOs) are delegated authority to pay up to $50,000, regardless of the amount claimed, and to disapprove or make a final offer on a claim presented in an amount not exceeding $50,000.

    (d) Authority to further delegate payment authority is set forth in § 536.3(g)(1) of this part. For further discussion also related to settlement and approval authority see paragraph 2-69 of DA Pam 27-162.

    (e) Where the claimed amount or potential claim damage exceeds $100,000 for COE claims or $50,000 for all others, Commander USARCS will be notified immediately, and be furnished a copy of the claim and a mirror file thereafter. See § 536.30 and AR 27-20, paragraph 2-12.

    Subpart I—Claims Cognizable Under Article 139, Uniform Code of Military Justice

    Statutory authority for Uniform Code of Military Justice (UCMJ) Claims.

    The authority for this subpart is Article 139, Uniform Code of Military Justice (UCMJ) (10 U.S.C. 939, which provides redress for property willfully damaged or destroyed, or wrongfully taken, by members of the Armed Forces of the United States.

    Purpose of UCMJ claims.

    This subpart sets forth the standards to apply and the procedures to follow in processing claims for the wrongful taking or willful damage or destruction of property by military members of the Department of the Army.

    Proper claimants; unknown accused—under the UCMJ.

    (a) A proper claimant under this subpart includes any individual (whether civilian or military), a business, charity, or state or local government that owns, has an ownership interest in, or lawfully possesses property.

    (b) When cognizable claims are presented against a unit because the individual offenders cannot be identified, this subpart sets forth the procedures for approval authorities to direct pay assessments, equivalent to the amount of damages sustained, against the unit members who were present at the scene and to allocate individual liability in such proportion as is just under the circumstances.

    Effect of disciplinary action, voluntary restitution, or contributory negligence for claims under the UCMJ.

    (a) Disciplinary action. Administrative action under Article 139, UCMJ, and this subpart is entirely separate and distinct from disciplinary action taken under other sections of the UCMJ or other administrative actions. Because action under both Article 139, UCMJ, and this subpart requires independent findings on issues other than guilt or innocence, a soldier's conviction or acquittal of claim-related charges is not dispositive of liability under Article 139, UCMJ.

    (b) Voluntary restitution. The approval authority may terminate Article 139 proceedings without findings if the soldier voluntarily makes full restitution to the claimant.

    (c) Contributory negligence. A claim otherwise cognizable and meritorious is payable whether or not the claimant was negligent.

    Claims cognizable as UCMJ claims.

    Claims cognizable under Article 139, UCMJ, are limited to the following:

    (a) Requirement that conduct constructively violate UCMJ. In order to subject a person to liability under Article 139, the soldier's conduct must be such as would constitute a violation of one or more punitive Articles of the UCMJ. However, a referral of charges is not a prerequisite to action under this subpart.

    (b) Claims for property willfully damaged. Willful damage is damage Start Printed Page 46295inflicted intentionally, knowingly, and purposefully without justifiable excuse, as distinguished from damage caused inadvertently, thoughtlessly or negligently. Damage, loss, or destruction of property caused by riotous, violent, or disorderly acts or acts of depredation, or through conduct showing reckless or wanton disregard of the property rights of others, may be considered willful damage.

    (c) Claims for property wrongfully taken. A wrongful taking is any unauthorized taking or withholding of property, with the intent to deprive, temporarily or permanently, the owner or person lawfully in possession of the property. Damage, loss, or destruction of property through larceny, forgery, embezzlement, fraud, misappropriation, or similar offense may be considered wrongful taking. However, mere breach of a fiduciary or contractual duty that does not involve larceny, forgery, embezzlement, fraud, or misappropriation does not constitute wrongful taking.

    (d) Definition of property. Article 139 provides compensation for loss of or damage to both personal property, whether tangible or intangible, and real property. Contrast this to the Personnel Claims Act and chapter 11 of AR 27-20, which provides compensation only for tangible personal property. Monetary losses may fall into the category of either tangible property (for example, cash), or intangible property (for example, an obligation incurred by a claimant to a third party as a result of fraudulent conduct by a soldier), although recovery for losses of intangible property may be limited by other provisions of this part, such as the exclusion of theft of services (see § 536.130(f)) or consequential damages (see § 536.130(g)).

    (e) Claims cognizable under more than one statute. Claims cognizable under other claims statutes may be processed under this subpart.

    Claims not cognizable as UCMJ claims.

    Claims not cognizable under Article 139, UCMJ, and this subpart, include the following:

    (a) Claims resulting from negligent acts.

    (b) Claims for personal injury or death.

    (c) Claims resulting from acts or omissions of military personnel acting within the scope of their employment, including claims resulting from combat activities or noncombat activities, as those terms are defined in the Glossary of AR 27-20.

    (d) Claims resulting from the conduct of Reserve component personnel who are not subject to the UCMJ at the time of the offense.

    (e) Subrogated claims.

    (f) Claims for theft of services, even if such theft constitutes a violation of Article 134 of the UCMJ.

    (g) Claims for indirect, remote, or consequential damages.

    (h) Claims by entities in conflict with the United States or whose interests are hostile to the United States.

    Limitations on assessments arising from UCMJ claims.

    (a) Limitations on amount. (1) A special court-martial convening authority (SPCMCA) has authority to approve a pay assessment in an amount not to exceed $5,000 per claimant per incident and to deny a claim in any amount. If the Judge Advocate responsible for advising the SPCMCA decides that the SPCMCA's final action under the provisions of Rule for Courts-Martial 1107 in a court martial arising out of the same incident would be compromised, the SPCMCA may forward the Article 139 claim to the general court-martial convening authority (GCMCA) for action.

    (2) A GCMCA, or designee, has authority to approve a pay assessment in an amount not to exceed $10,000 per claimant per incident and to deny a claim in any amount.

    (i) If the GCMCA or designee determines that a claim exceeding $10,000 per claimant per incident is meritorious, that officer will assess the soldier's pay in the amount of $10,000 and forward the claim to the Commander USARCS, with a recommendation to increase the assessment.

    (ii) If the head of the area claims office (ACO) (usually the GCMCA's Staff Judge Advocate (SJA)) decides that the GCMCA's final action under the provisions of Rule for Courts-Martial 1107 in a court-martial arising out of the same incident would be compromised, that officer may forward the Article 139 claim to USARCS for action.

    (3) Only TJAG, TAJAG, the Commander USARCS, or designee has authority to approve assessments in excess of $10,000 per claimant per incident.

    (b) Limitations on type of damages. Property loss or damage assessments are limited to direct damages. This subpart does not provide redress for indirect, remote, or consequential damages.

    Procedure for processing UCMJ claims.

    (a) Time limitations on submission of a claim. A claim must be submitted within 90 days of the incident that gave rise to it, unless the SPCMCA acting on the claim determines there is good cause for delay. Lack of knowledge of the existence of Article 139, or lack of knowledge of the identity of the offender, are examples of good cause for delay.

    (b) Form and presentment of a claim. The claimant or authorized agent may present a claim orally or in writing. If presented orally, the claim must be reduced to writing, signed, and seek a definite sum in U.S. dollars within 10 days after oral presentment.

    (c) Action upon receipt of a claim. Any officer receiving a claim will forward it within two working days to the SPCMCA exercising jurisdiction over the soldier or soldiers against whom the claim is made. If the claim is made against soldiers under the jurisdiction of two or more convening SPCMCAs who are under the same GCMCA, forward the claim to that GCMCA. That GCMCA will designate one SPCMCA to investigate and act on the claim as to all soldiers involved. If the claim is made against soldiers under the jurisdiction of more than one SPCMCA at different locations and not under the same GCMCA, forward the claim to the SPCMCA whose headquarters is located nearest the situs of the alleged incident. That SPCMCA will investigate and act on the claim as to all soldiers involved. If a claim is brought against a member of one of the other military services, forward the claim to the commander of the nearest major command of that service equivalent to a major Army command (MACOM).

    (d) Action by the special court-martial convening authority. (1) If the claim appears to be cognizable, the SPCMCA will appoint an investigating officer within four working days of receipt of a claim. The investigating officer will follow the procedures of this subpart supplemented by DA Pam 27-162, chapter 9, and AR 15-6, chapter 4, which applies to informal investigations. The SPCMCA may appoint the claims officer of a command (if the claims officer is a commissioned officer) as the investigating officer. In cases where the special court-martial convening authority is an inactive duty soldier of the United States Army Reserve, the appointment of an investigating officer will be made within 30 calendar days.

    (2) If the claim is not brought against a person who is a member of the Armed Forces of the United States at the time the claim is received, or if the claim does not appear otherwise cognizable under Article 139, UCMJ, the SPCMCA Start Printed Page 46296may refer it for legal review (see paragraph (g) of this section) within four working days of receipt. If after legal review the SPCMCA determines that the claim is not cognizable, final action may be taken disapproving the claim (see paragraph (h) of this section) without appointing an investigating officer. In claims where the special court-martial convening authority is an inactive duty soldier of the United States Army Reserve, the request for a legal review will be made within 30 calendar days.

    (e) Expediting payment through Personnel Claims Act and Foreign Claims Act procedures. When assessment action on a particular claim will be unduly delayed, the claims office supporting the SPCMA may consider the claim under the Personnel Claims Act, 31 U.S.C. 3721, and chapter 11 of AR 27-20, or under the Foreign Claims Act, 10 U.S.C. 2734, and subpart J of this part, as long as it is otherwise cognizable under that authority. If the Article 139 claim is later successful, the claims office will inform the claimant of the obligation to repay to the government any overpayment received under these statutes.

    (f) Action by the investigating officer. The investigating officer will notify the soldier against whom the claim is made.

    (1) If the soldier wishes to make voluntary restitution, the investigating officer may, with the SPCMCA's concurrence, delay proceedings until the end of the next pay period to permit restitution. If the soldier makes payment to the claimant's full satisfaction, the SPCMCA will dismiss the claim.

    (2) In the absence of full restitution, the investigating officer will determine whether the claim is cognizable and meritorious under the provisions of Article 139, UCMJ, and this subpart, and the amount to be assessed against each offender. This amount will be reduced by any restitution the claimant accepts from an offender in partial satisfaction. Within 10 working days, or such time as the SPCMCA may determine, the investigating officer will submit written findings and recommendations to the SPCMCA.

    (3) If the soldier is absent without leave and cannot be notified, a claims office may process the Article 139 claim in the soldier's absence. If an assessment is approved, forward a copy of the claim and the memorandum authorizing pay assessment by transmittal letter to the servicing Defense Accounting Office (DAO) for offset against the soldier's pay. If the soldier is dropped from the rolls, the servicing DAO will forward the assessment documents to: Commander, Defense Finance and Accounting Service (DFAS), ATTN: Military Pay Operations, 8899 E. 56th Street, Indianapolis, IN 46249.

    (g) Legal review. The SPCMCA will refer the claim for legal review to its servicing legal office upon either completion of the investigating officer's report or the SPCMCA's determination that the claim is not cognizable (see paragraph (d)(2) of this section).

    (1) Within five working days or such time as the SPCMCA determines, that office will furnish a written opinion as to:

    (i) Whether the claim is cognizable under the provisions of Article 139, UCMJ, and this subpart.

    (ii) Whether the findings and recommendations are supported by a preponderance of the evidence.

    (iii) Whether the investigation substantially complies with the procedural requirements of Article 139, UCMJ; this subpart; DA Pam 27-162, chapter 9; and AR 15-6, chapter 4.

    (iv) Whether the claim is clearly not cognizable (see paragraph (d)(2) of this section) and final denial action can be taken without appointing an investigating officer.

    (2) If the investigating officer's recommended assessment does not exceed $5,000, the claims judge advocate (CJA) or claims attorney will, upon legal review, forward the claim to the SPCMCA for final action.

    (3) If the investigating officer's recommended assessment is more than $5,000, the CJA or claims attorney will, upon legal review, forward the claim file to the head of the ACO, who will also conduct a legal review within five working days.

    (i) If the recommended assessment does not exceed $10,000, the head of the ACO will forward the claim file to the GCMCA for final action.

    (ii) If the recommended assessment exceeds $10,000, the head of the ACO will forward the claim file to the GCMCA for approval of an assessment up to $10,000 and for a recommendation of an additional assessment. The head of the ACO will then forward the claims file and the GCMCA's recommendation to the Commander USARCS for approval.

    (h) Final action. After consulting with the legal advisor, the approval authority will disapprove or approve the claim in an amount equal to, or less than, the amount of the assessment limitation. The approval authority is not bound by the findings or recommendations of the investigating officer; AR 15-6, paragraph 2-3a. The approval authority will notify the claimant, and any soldier subject to that officer's jurisdiction, of the determination and the right of any party to request reconsideration (see § 536.133). A copy of the investigating officer's findings and recommendation will be enclosed with the notice. The approval authority will then suspend action on the claim for 10 working days pending receipt of a request for reconsideration, unless the approval authority determines that this delay will result in substantial injustice. If after this period the approval authority determines that an assessment is still warranted, the approval authority will direct the appropriate DAO to withhold such amount from the soldier's pay account (see § 536.131(a)). For any soldier not subject to the approval authority's jurisdiction, the approval authority will forward the claim to the commander who exercises SPCMCA jurisdiction over the soldier for assessment. The receiving SPCMCA is bound by the determination of the approval authority.

    (i) Assessment. Subject to any limitations set forth in appropriate regulations, the servicing DAO will withhold the amount directed by the approval authority and pay it to the claimant. The assessment is not subject to appeal and is binding on any finance officer. If the servicing DAO cannot withhold the required amount because it does not have custody of the soldier's pay record, the record is missing, or the soldier is in a no pay due status, that office will promptly notify the approval authority of this fact in writing.

    (j) Remission of indebtedness. 10 U.S.C. 4837, which authorizes the remission and cancellation of indebtedness of an enlisted person to the United States or its instrumentalities, is not applicable and may not be used to remit and cancel indebtedness determined as a result of action under Article 139, UCMJ.

    Reconsideration of UCMJ claims.

    (a) General. Although Article 139, UCMJ, does not provide for a right of appeal, either the claimant or a soldier whose pay is assessed may request the approval authority (SPCMCA or GCMCA, depending on the amount assessed) or successor in command to reconsider the action. Either party must submit such a request for reconsideration in writing and clearly state the factual or legal basis for the relief requested. The approval authority may direct that the matter be reinvestigated.

    (b) Reconsideration by the original approval authority. The original approval authority may reconsider the action at any time while serving as the approval authority for the claim in Start Printed Page 46297question, even after the transfer of the soldier whose pay was assessed. The original approval authority may modify the action if it was incorrect, subject to paragraph (d) of this section. However, the approval authority should modify the action only because of fraud, substantial new evidence, errors in calculation, or mistake of law.

    (c) Reconsideration by a successor in command. Subject to paragraph (d) of this section, a successor in command may modify an action only because of fraud, substantial new evidence, errors in calculation, or mistake of law apparent on the face of the record.

    (d) Legal review and action. Prior to modifying the original action, the approval authority will have the servicing claims office render a legal opinion and fully explain the basis for modification as part of the file. If the legal review agrees that a return of the assessed pay is appropriate, the approval authority should request in writing that the claimant return the money, setting forth in the letter the basis for the request. There is no authority for repayment from appropriated funds.

    (e) Disposition of files. After completing action on reconsideration, the approval authority will forward the reconsideration action to the servicing claims office, which will then file the action per § 536.132(h).

    Additional claims judge advocate and claims attorney responsibilities (for UCMJ claims).

    In addition to the duties set forth in this subpart, the CJA or claims attorney is responsible for forwarding copies of completed Article 139 actions to USARCS, maintaining a log, monitoring the time requirements of pending Article 139 actions, and publicizing the Article 139 program to commanders, soldiers, and the community.

    Subpart J—Claims Cognizable Under the Foreign Claims Act

    Statutory authority for the Foreign Claims Act.

    (a) The statutory authority for this subpart is the Act of August 10, 1956, 10 U.S.C. 2734 (70 Stat. 154), commonly referred to as the Foreign Claims Act (FCA), as amended by Public Law 86-223, September 1959 (73 Stat. 453); Public Law 86-411, April 1960 (74 Stat. 16); Public Law 90-521, September 1968 (82 Stat. 874); Public Law 91-312, July 1970 (84 Stat. 412); Public Law 93-336, July 1974 (88 Stat. 292); Public Law 96-513, Title V, section 511 (95), December 1980 (94 Stat. 2928). It is posted on the USARCS Web site; for the address see § 536.2(a).

    (b) Claims arising from the acts or omissions of the U.S. Armed Forces in the Marshall Islands or the Federated States of Micronesia are settled in accordance with Art. XV, Non-contractual Claims, of the U.S.-Marshall Islands and Micronesian Status of Forces Agreement (the “SOFA”) (posted on the USARCS Web site; for the address see § 536.2(a)). This is pursuant to the “agreed upon minutes” that are appended to the SOFA, pursuant to Section 323 of the Compact of Free Association between the U.S. and the Marshall Islands and the Federated States of Micronesia, enacted by Public Law 99-239, January 14, 1986. (The Compact may be viewed at http://www.fm/​jcn/​compact/​relindex.html). The “agreed upon minutes” state that “all claims within the scope of paragraph 1 of Article XV [Claims], [of the Compact] * * * shall be processed and settled exclusively pursuant to the Foreign Claims Act, 10 U.S.C. 2734, and any regulations promulgated in implementation thereof.” Therefore, Title I, Article 178 of the Compact, regarding claims processing, is not applicable to claims arising from the acts or omissions of the U.S. armed forces, but only to other federal agencies. Those agencies are required to follow the provisions of the Federal Tort Claims Act, 28 U.S.C. 2672.

    Scope for claims arising under the Foreign Claims Act.

    (a) Application. This subpart, which is applicable outside the United States, its commonwealths, territories and possessions, including areas under the jurisdiction of the United States, implements the FCA and prescribes the substantive basis and special procedural requirements for settlement of claims of inhabitants of a foreign country, or of a foreign country or a political subdivision thereof, against the United States for personal injury, death, or property damage caused by service members or civilian employees, or claims that arise incident to noncombat activities of the armed forces.

    (b) Effect of Military Claims Act (MCA). Claims arising in foreign countries will be settled under the MCA if the injured party is an inhabitant of the U.S., for example, a member of the U.S. armed forces, a U.S. civilian employee, or a family member of either category. In a wrongful death case, if the decedent is an inhabitant of a foreign country, even though his survivors are U.S. inhabitants, the FCA will apply. See § 536.74(c).

    (c) Effect of Army Maritime Claims Settlement Act (AMCSA) (10 U.S.C. 4801, 4802 and 4808). A maritime claim may be settled under the FCA.

    Claims payable under the Foreign Claims Act.

    (a) A claim for death, personal injury, or loss of or damage to property may be allowed under this subpart if the alleged damage results from noncombat activity or a negligent or wrongful act or omission of soldiers or civilian employees of the U.S. armed forces, as enumerated in § 536.23(b), regardless of whether the act or omission was made within the scope of their employment. This includes non-U.S. citizen employees recruited elsewhere but employed in a country of which they are not a citizen. However, a claim generated by non-U.S. citizen employees in the country in which they were recruited and are employed will be payable only if the act or omission was made in the scope of employment. But claims arising from the operation of U.S. armed forces vehicles or other equipment by such employees may be paid, even though the employees are not acting within the scope of their employment, provided the employer or owner of the vehicle or other equipment would be liable under local law in the circumstances involved.

    (b) Claims generated by officers or civilian employees of the American Battle Monuments Commission (36 U.S.C. 2110), acting within the scope of employment, will be paid from American Battle Monuments Commission appropriations.

    (c) Claims for the loss of, or damage to, property that may be settled under this subpart include the following:

    (1) Real property used and occupied under lease, express, implied, or otherwise. See § 536.34(m) of this part and paragraph 2-15m of DA Pam 27-162.

    (2) Personal property bailed to the government under an agreement, express or implied, unless the owner has expressly assumed the risk of damage or loss.

    Claims not payable under the Foreign Claims Act

    A claim is not payable if it:

    (a) Results wholly from the negligent or wrongful act of the claimant or agent;

    (b) Is purely contractual in nature;

    (c) Arises from private or domestic obligations as distinguished from government transactions;

    (d) Is based solely on compassionate grounds;

    (e) Is a bastardy claim for child support expenses;

    (f) Is for any item whose acquisition, possession, or transportation is in Start Printed Page 46298violation of Department of the Army (DA) or Department of Defense (DOD) directives, such as illegal war trophies.

    (g) Is for rent, damage, or other payments involving the acquisition, use, possession, or disposition of real property or interests therein by and for the DA. See § 536.34(m) of this part and paragraph 2-15m of DA Pam 27-162.

    (h) Is not in the best interest of the United States, is contrary to public policy, or otherwise contrary to the basic intent of the governing statute (10 U.S.C. § 2734); for example, claims for property loss or damage, or personal injury or death caused by inhabitants of unfriendly foreign countries or by individuals considered to be unfriendly to the United States.

    (i) Is presented by a national, or a corporation controlled by a national, of a country at war or engaged in armed conflict with the United States, or any country allied with such enemy country unless the appropriate settlement authority determines that the claimant is, and at the time of the incident was friendly to the United States. A prisoner of war or an interned enemy alien is not excluded from filing a claim for damage, loss, or destruction of personal property within the federal government's custody if the claim is otherwise payable.

    (j) Is for damages or injury, the claim for which a receiving State should adjudicate and pay pursuant to an international agreement, subject to waiver by the Commander USARCS. See DA Pam 27-162, paragraph 3-4a(2), for a discussion of the conditions of waiver.

    (k) Is listed in §§ 536.45 and 536.46, except for the exclusions listed in §§ 536.45(e), (h) and (k). Additionally, the exclusions set forth in §§ 536.45(a) and (b) do not apply to a claim arising incident to noncombat activities.

    (l) Is brought by a subrogee.

    (m) Is covered by insurance on the involved U.S. Armed Forces' vehicle or the tortfeasor's privately owned vehicle (POV), in accordance with requirements of a foreign country, unless the claim exceeds the coverage or the insurer is insolvent. See § 536.139(c).

    (n) Is payable under subpart C of this part or AR 27-20, chapter 11.

    (o) Is brought by or on behalf of a member of a foreign military force for personal injury or death arising incident to service, or pursuant to combined military operations. Combined military operations include exercises and United Nations and North Atlantic Treaty Organization (NATO) peacekeeping and humanitarian missions. Derivative claims arising from these incidents are also excluded.

    Applicable law for claims under the Foreign Claims Act.

    (a) Venue of incident and domicile of claimant. In determining an appropriate award, apply the law and custom of the country in which the incident occurred to determine which elements of damages are payable and which individuals are entitled to compensation. However, where the claimant is an inhabitant of another foreign country and only temporarily within the country in which the incident occurred, the quantum of certain elements of damages, such as lost wages and future medical care, may be calculated based on the law and economic conditions in the country of the claimant's permanent residence. Where the decedent is the subject of a wrongful death case, the quantum will be determined based on the country of the decedent's permanent residence regardless of the fact that his survivors live in the U.S. or a different foreign country than the decedent. See § 536.77 for further damages guidance.

    (b) Other guidance. The guidance set forth in §§ 536.77(b) through (d) as to allowable elements of damages is generally applicable. Where moral damages, as defined in DA Pam 27-162, paragraph 2-53c(4), are permitted, such damages are payable. In some countries it is customary to get a professional appraisal to substantiate certain claims and pass this cost on to the tortfeasor. The Commander USARCS or the chief of a command claims service may, as an exception to policy, permit the reimbursement of such costs in appropriate cases. Where feasible, claimants should be discouraged from incurring such costs.

    (c) Deductions for insurance. (1) Insurance coverage recovered or recoverable will be deducted from any award. In that regard, every effort will be made to monitor the insurance aspect of the case and encourage direct settlement between the claimant and the insurer of the tortfeasor.

    (2) When efforts under paragraph (c)(1) of this section are of no avail, or when it otherwise is determined that an insurance settlement will not be reasonably available for application to the award, no award will be made until the chief of the command claims service or the Commander USARCS, has first granted consent. In such cases, an assignment of the insured's rights against the insurer will be obtained and, in appropriate cases, reimbursement action will be instituted against the insurer under applicable procedures.

    (3) If an insurance settlement is not available due to the insurer's insolvency or bankruptcy, a report on the bankruptcy will be forwarded to the Commander USARCS without delay, setting forth all pertinent information, including the alleged reasons for the bankruptcy and the facts concerning the licensing of the insurer.

    (d) Deductions for amounts paid by tortfeasor. Settlement authorities will deduct from the damages any direct payments by a member or civilian employee of the U.S. armed forces for damages (other than solatia).

    Appointment and functions of Foreign Claims Commissions.

    (a) Claims cognizable under this subpart will be referred to the command responsible for claims arising within its geographic area of responsibility, including claims transferred by agreement between the services involved. The senior judge advocate of a command having a command claims service, or his delegee, will appoint a sufficient number of Foreign Claims Commissions (FCCs) to dispose of the claims. If there is no command claims service, the responsible commander may ask the Commander USARCS for permission to establish one. Otherwise, the Commander USARCS will appoint a sufficient number of FCCs from personnel furnished by the command involved. See § 576.3(d) of this chapter for more information about command claims services.

    (b) The Commander USARCS will appoint all other FCCs to act on all other claims, regardless of where such claims arose, unless they arose in a country for which single-service responsibility has been assigned to another service. FCCs appointed by the Commander USARCS at units based in the continental United States (CONUS) may act on any claim arising out of such unit's operations. Any FCC operating in, or adjudicating claims arising out of, a geographical area within a command claims service's jurisdiction, will comply with that service's legal and procedural rules.

    (c) An FCC may operate as an integral part of a command claims service, which will determine the cases to be assigned to it, furnish necessary administrative services, and establish and maintain its records. Where an FCC does not operate as part of a command claims service, it may operate as part of the office or a division, corps or higher command staff judge advocate (SJA), which will perform the foregoing functions.

    (d) An appointing authority who appoints or relieves an FCC whom he or she has appointed will forward one copy of each order addressing an FCC's appointment, relief, or change of responsibility to the Commander Start Printed Page 46299USARCS. Upon receipt of an initial appointing order, the Commander USARCS will assign an office code number to the FCC. Without such a number the FCC has no authority to approve or pay claims. See AR 27-20, paragraph 13-1.

    (e) Normally, the FCC is responsible for the investigation of all claims referred to it, using both the procedures set forth in subpart B of this part and any local procedures established by the appointing authority or command claims service responsible for the geographical area in which the claim arose. Chiefs of a command claims service may request assistance on claims investigation within their geographical areas from units or organizations other than the FCC. The Commander USARCS may make the same request for any claim referred to an FCC appointed under his or her authority.

    (f) When an FCC intends to deny a claim, or offer an award less than the amount claimed, it will notify in writing the claimant, the claimant's authorized agent, or legal representative of the intended action on the claim and the legal and factual bases for that action. If the FCC proposes a partial award, a settlement agreement should be enclosed with the notice. Claimants will be advised that they may either accept the FCC action by returning the signed settlement agreement or, if dissatisfied with the FCC's action, they may submit a request for reconsideration stating the factual or legal reasons why they believe the FCC's proposed action is incorrect. This notice serves to give the claimant an opportunity to request reconsideration of the FCC action and state the reasons for the request before final action is taken on the claim. When the FCC intends to award the amount claimed, or recommend an award equal to the amount claimed to a higher authority, this procedure is not necessary. However, a settlement agreement is required for all awards, full or partial. See § 536.63(a).

    (1) This notice should be given at least 30 days before the FCC takes final action, except on small claims processed pursuant to § 536.33. The notice should be mailed via certified or registered mail to the claimant. The claimant should be informed that any request for reconsideration should be addressed to the FCC that took final action, and that all materials the claimant wishes the FCC to consider should be included with the request for reconsideration.

    (2) An FCC may alter its initial decision based on the claimant's response or proceed with the intended action. If the claimant's response raises a general policy issue, the FCC may request an advisory opinion from the Commander USARCS or the chief of the command claims service while retaining the claim for final action at its level.

    (3) Upon completing of its evaluation of the claimant's response, the FCC will notify the claimant of its final decision and advise the claimant that its action is final and conclusive as a matter of law (10 U.S.C. 2735), unless the final decision is a recommendation for payment above its authority. In that case, the FCC will forward any response submitted by the claimant along with its claims memorandum of opinion to the approval authority, and will notify the claimant accordingly.

    (4) When an FCC determines that a claim is valued at more than $50,000 or all claims arising out of a single incident are valued at more than $100,000, the file will be transferred to the Commander USARCS for further action; see § 536.143(d)(2). Upon request of the Commander USARCS, the FCC may negotiate a settlement, the amount of which exceeds the FCC's authority; however, prior approval by a higher authority is required.

    (5) Every reasonable effort should be made to negotiate a mutually agreeable settlement on meritorious claims. When an agreement can be reached, the notice and response provisions above are not necessary. If the FCC recommends an award in excess of its monetary authority, the settlement agreement should indicate that its recommendation is contingent upon approval by higher authority.

    (g) The chief of an overseas command claims service may delegate to a one-member FCC the responsibility for the receipt, processing, and investigation of any claim, regardless of amount, except those required to be referred to a receiving State office for adjudication under the provisions of a treaty concerning the status of U.S. forces in the country in which the claim arose. If, after investigation, it appears that action by a three-member FCC is appropriate, the one-member FCC should send the claim to the appropriate three-member FCC with a complete investigation report, including a discussion of the applicable local law and a recommendation for disposition.

    Composition of Foreign Claims Commissions.

    (a) Normally, an FCC will be composed of either one or three members. Alternate members of three-member FCCs may be appointed when circumstances require, and may be substituted for regular members on specific cases by order of the appointing authority. The appointing orders will clearly designate the president of a three-member FCC. Two members of a three-member FCC will constitute a quorum, and the FCC's decision will be determined by majority vote.

    (b) Upon approval by the Commander USARCS and the appropriate authority of another uniformed service, the membership may be composed of one or more members of another uniformed service. If another service has single-service responsibility over the foreign country in which the claim arose, that service is responsible for the claim. If requested, the Commander USARCS may furnish a JAG officer or claims attorney to be a member of another service's FCC.

    Qualification of members of Foreign Claims Commissions.

    Normally, a member of an FCC will be either a commissioned officer or a claims attorney. At least two members of a three-member FCC must be JAs or claims attorneys. In exigent circumstances, a qualified non-lawyer employee of the armed forces may be appointed to an FCC, subject to prior approval by the Commander USARCS. Such approval may be granted only upon a showing of the employee's status and qualifications and adequate justification for such appointment (for example, lack of legally qualified personnel). The FCC will be limited to employees who are citizens of the United States. An officer, claims attorney, or employee of another armed force will be appointed a member of an Army FCC only if approved by the Commander USARCS.

    Settlement authority of Foreign Claims Commissions.

    (a) In order to determine whether the claim will be considered by a one-member or three-member FCC, the claimed amount will be converted to the U.S. dollar equivalent (based on the annual Foreign Currency Fluctuation Account exchange rate, where applicable). However, the FCC's jurisdiction to approve is determined by the conversion rate on the date of final action. Accordingly, if the value of the U.S. dollar has decreased, the FCC will forward the recommendation to a higher authority, if necessary.

    (b) Payment will be made in the currency of the country in which the incident occurred or in which the claimant resided at the time of the incident, unless the claimant requests payment in U.S. dollars or another currency and such request is approved by the chief of a command claims service or the Commander USARCS. Start Printed Page 46300However, if the claimant resides in another foreign country at the time of payment, payment in an amount equivalent to that which would have been paid under the preceding sentence may be made in the currency of that third country without the approval of the Commander USARCS.

    (c) A one-member FCC may consider and pay claims presented in any amount provided a mutually agreed settlement may be reached in an amount not exceeding the FCC's monetary authority. A one-member FCC may deny any claim when the claimed amount does not exceed its monetary authority. Unless otherwise restricted by the appointing authority, a one-member FCC who is a JA or claims attorney has $15,000 monetary authority, while any other one-member commission has $5,000 monetary authority.

    (d) A three-member FCC, unless otherwise restricted by the appointing authority, may take the following actions on a claim that is properly before it:

    (1) Disapprove a claim presented in any amount. After following the procedures in § 536.140, including reconsideration, the disapproval is final and conclusive under 10 U.S.C. 2735. The FCC will inform the appointing authority of its action. After it takes final action and disapproves a claim presented in any amount over $50,000, the FCC will forward to the appointing authority the written notice to the claimant required by § 536.140(f), any response from the claimant, and its notice of final action on the claim.

    (2) Approve and pay meritorious claims presented in any amount. (i) Claims paid in full or in part for an amount not exceeding $50,000 will be paid after any reconsideration as set forth in § 536.140. This action is final and conclusive under 10 U.S.C. 2735.

    (ii) Claims valued at an amount exceeding $50,000, or multiple claims arising from the same incident valued at more than $100,000, will be forwarded through the appointing authority with a memorandum of opinion to the Commander USARCS for action; see DA Pam 27-162, paragraph 2-60. The memorandum of opinion will discuss the amount for which the claimant will settle and include the recommendation of the FCC.

    (e) The Judge Advocate General (TJAG), The Assistant Judge Advocate General (TAJAG) and the Commander USARCS, or his or her designee serving at USARCS, may approve and pay, in whole or in part, any claim as long as the amount of the award does not exceed $100,000; may disapprove any claim, regardless of either the amount claimed or the recommendation of the FCC forwarding the claim; or, if a claim is forwarded to USARCS for approval of payment in excess of $50,000, refer the claim back to the FCC or another FCC for further action.

    (f) Payments in excess of $100,000 will be approved by the Secretary of the Army, the Army General Counsel as the Secretary's designee, or other designee of the Secretary.

    (g) Following approval where required and receipt of an agreement by the claimant accepting the specific sum awarded by the FCC, the claim will be processed for payment in the appropriate currency. The first $100,000 of any award will be paid from Army claims funds. The excess will be reported to the Financial Management Service, Department of Treasury, with the documents listed in DA Pam 27-162, paragraph 2-81.

    (h) If the settlement authority upholds a final offer or authorizes an award on appeal from a denial of a claim, the notice of the settlement authority's action will inform the claimant that he or she must accept the award within 180 days of the date of mailing of the notice of the settlement authority's action or the award will be withdrawn, the claim will be deemed denied, and the file will be closed without future recourse.

    Reopening a claim after final action by a Foreign Claims Commission.

    (a) Original approval or settlement authority (including TAJAG, TJAG, Secretary of the Army, or the Secretary's designees). (1) An original settlement authority may reconsider the denial of, or final offer on a claim brought under the FCA upon request of the claimant or the claimants authorized agent. In the absence of such a request, the settlement authority may reconsider a claim on its own initiative.

    (2) An original approval or settlement authority may reopen and correct action on an FCA claim previously settled in whole or in part (even if a settlement agreement has been executed) when it appears that the original action was incorrect in law or fact based on the evidence of record at the time of the action or subsequently received. For errors in fact, the new evidence must not have been discoverable at the time of final action by either the Army or the claimant through the exercise of reasonable diligence. Corrective action may also be taken when an error contrary to the parties' mutual understanding is discovered in the original action. If it is determined that the original action was incorrect, the action will be modified, and if appropriate, a supplemental payment made. The basis for a change in action will be stated in a memorandum included in the file. For example, a claim was settled for $15,000, but the settlement agreement was typed to read “$1,500” and the error is not discovered until the file is being prepared for payment. If appropriate, a corrected payment will be made. A settlement authority who has reason to believe that a settlement was obtained by fraud on the part of the claimant or the claimant's legal representative, will reopen action on that claim and, if the belief is substantiated, correct the action. The basis for correcting an action will be stated in a memorandum and included in the file.

    (b) A successor approval or settlement authority (including TAJAG, TJAG, Secretary of the Army, or the Secretary's designees). (1) Reconsideration. A successor approval or settlement authority may reconsider the denial of, or final offer on, an FCA claim upon request of the claimant or the claimant's authorized agent only on the basis of fraud, substantial new evidence, errors in calculation, or mistake (misinterpretation) of law.

    (2) Settlement correction. A successor approval or settlement authority may reopen and correct a predecessor's action on a claim that was previously settled in whole or in part for the same reasons that an original authority may do so.

    (c) Time requirement for filing request for reconsideration. Requests postmarked more than five years from the date of mailing of final notice will be denied based on the doctrine of laches.

    (d) Finality of action. Action by the appropriate authority (either affirming the prior action or granting full or partial relief) is final under the provisions of 10 U.S.C. 2735. Action upon request for reconsideration constitutes final administrative disposition of a claim. No further requests for reconsideration will be allowed except on the basis of fraud.

    Solatia payment.

    Payment of solatia in accordance with local custom as an expression of sympathy toward a victim or his or her family is common in some overseas commands. Solatia payments are known to be a custom in the Federated States of Micronesia, Japan, Korea, and Thailand. In other countries, the FCC should consult the command claims service or Commander USARCS for guidance. Such payments are not to be made from the claims expenditure allowance. These payments are made from local operation and maintenance Start Printed Page 46301funds. This applies even where a command claims service is directed to administer the command's solatia program. See, for example, United States Forces Korea Regulation 526-11 regarding solatia amounts and procedures.

    Subpart K—Nonappropriated Fund Claims

    Claims against nonappropriated fund employees—generally.

    This subpart sets forth the procedures to follow in the settlement and payment of claims generated by the acts or omissions of the employees of nonappropriated fund (NAF) activities. NAF activities include NAF or Army and Air Force Exchange Service (AAFES) facilities, post exchanges, bowling centers, officers and noncommissioned officers' clubs, and other facilities located on land or situated in a building used by an activity that employs personnel compensated from NAFs.

    Claims by NAFI employees for losses incident to employment.

    Claims by employees for the loss of or damage to personal property incident to employment will be processed in the manner prescribed by AR 27-20, chapter 11 and will be paid from NAFs in accordance with § 536.152.

    Claims generated by the acts or omissions of NAFI employees.

    (a) Processing. Claims arising out of acts or omissions of employees of NAFI activities will be processed and settled in the manner specified for similar claims against the United States, except that payment will be made from NAFs in accordance with AR 215-1 (Morale, Welfare, and Recreation Activities and Nonappropriated Fund Instrumentalites) and § 536.152 of this part.

    (b) Procedural requirements. Procedural requirements of this part's pertinent subparts, as stated below, will be followed except as provided in §§ 536.151 and 536.152. However, when the Nonappropriated Fund Instrumentality (NAFI) is protected by a commercial insurer (for example, flying and parachute activities), the claim will be referred to the insurer as outlined in § 536.148(d). See Department of Defense Directive (DODD) 5515.6, dated November 3, 1956, posted on the USARCS Web site (see § 536.2(a)).

    (1) Claims arising within the United States, its territories, commonwealths, or possessions. Such claims will be processed in the manner prescribed by subparts C, D, E, F, H or J of this part, as appropriate.

    (2) Claims arising outside the United States, its territories, commonwealths, or possessions. Such claims will be processed in accordance with the provisions of applicable Status of Forces Agreements (SOFAs) or in the manner prescribed by subparts C, D, E, F, H or J of this part, as appropriate.

    (b) Reporting and investigation. Such claims will be investigated in accordance with AR 215-1 and subpart B of this part.

    (1) Reporting. Personal injury, death, or property damage resulting from vehicular collisions, falls, falling objects, assaults, or accidents of similar nature will be reported immediately to the person in charge of the NAFI or activity at which it occurred. The report should be made by the employee who initially received notice of the incident, even if the individual involved denies sustaining personal injury or property damage. Upon receipt of the report of the incident, the person in charge of the NAF activity concerned will transmit the report to the area claims office (ACO) or claims processing office (CPO) for investigation.

    (2) Investigation. Claims arising out of acts or omissions of employees of NAF activities will be investigated in the manner set forth in subpart B of this part. A determination as to whether the claim is cognizable under this section will be made as soon as practicable.

    (c) Customer complaints. AAFES-generated complaints will be handled in accordance with Exchange Service Manual 57-2. NAFI-generated complaints will be handled in accordance with AR 215-1, chapter 3. Complaints generated by appropriated funds laundry and dry-cleaning operations will be handled in accordance with AR 210-130, chapter 2. Complaints generated by refunds of sales proceeds will be handled in accordance with Exchange Operating Procedures (EOP) 57-2.

    (d) Commercial insurance. Certain NAFI activities (such as flying and parachute activities, and all AAFES concessionaires) may have private commercial insurance.

    (1) A claims investigation under subpart B of this part will not be conducted except when the claim's estimated value may exceed the insurance policy limits. In that event, the Commander USARCS, will be notified immediately and an investigation will be conducted with a view to determining whether the United States may be liable under subparts C, D, F, H or J of this part. Otherwise, the ACO or CPO will refer the claim to the insurer and furnish copies to the USARCS AAO, as required in AR 27-20, paragraph 2-12. Assistance will be furnished to the insurer as needed. Copies of any other required investigations may be furnished to the insurer.

    (2) The claim will be reviewed at key intervals to ensure that progress is being made, negotiations are properly conducted, and the file is closed. The Commander USARCS will be advised of any problems.

    (3) If requested by either the insurer or NAFI officials, the appropriate claims authority will assist in or conduct negotiations.

    (4) Where NAFI vehicles are required to be covered by insurance in foreign countries, the insurer will process the claim. However, if the policy coverage limit is exceeded or the insurer is insolvent, the claim may be processed under subpart G, §§ 536.114 through 536.116 (Claims arising overseas) or, if subpart G does not apply, under subparts C or J of this part. See § 536.139(c) for additional guidance.

    Identification of persons whose actions may generate liability.

    Claims resulting from the acts or omissions of members of the classes of persons listed below may be processed under this section. An ACO or a CPO authority will ask the Commander USARCS, for an advisory opinion prior to settling any claim where the person whose conduct generated the claim does not clearly fall within one of the following categories:

    (a) Civilian employees of NAFI activities whose salaries are paid from NAFs.

    (b) Active duty military personnel while performing off-duty part-time work for which they are compensated from NAFIs, not to include members who are acting in their capacity as an officer or other official of the NAFI.

    (c) Volunteers serving in an official capacity in furtherance of the business of the United States, limited to those categories set forth in DA Pam 27-162, paragraph 2-45d.

    Claims payable from appropriated funds.

    Claims payable from appropriated funds (APFs) will be processed under the appropriate subpart. Appropriated fund payable claims include those resulting from:

    (a) Acts or omissions of military personnel while performing assigned military duties in connection with NAFI activities.

    (b) Acts or omissions of civilian employees paid from appropriated funds in connection with NAFI activities. Start Printed Page 46302

    (c) Negligent maintenance of an appropriated funds facility used by a NAFI activity but for which the Department of Defense or Department of the Army (DA) command concerned is responsible and has been notified of the deficiency by the NAF. Where liability is determined to exist for both a NAFI and an appropriated fund activity, liability will be apportioned between the two activities.

    (d) Temporary use of a NAFI facility by an appropriated fund activity.

    (e) Operation of government owned or rented vehicles on authorized missions for NAFI activities where the driver is a DA soldier or civilian employee and is paid from APFs.

    Settlement authority for claims generated by acts or omissions of NAFI employees.

    (a) Settlement. Claims cognizable under this section and processed under subparts C, D, E, G, H or J of this part will be settled by claims authorities authorized to settle claims under those subparts subject to the same monetary and denial authority limitations, except that The Judge Advocate General (TJAG), The Assistant Judge Advocate General (TAJAG), and the Commander USARCS may settle such claims without regard to monetary limitations. However, the approval of the Attorney General or Assistant General Counsel may be required for an apportioned amount to be paid from APFs when subpart D of this part procedures are used and the amount to be paid from APFs exceeds $200,000. Similarly, approval of TAJAG, the Attorney General or the Assistant General Counsel is required when using procedures under subparts C, F, H, or J of this part and an apportioned amount to be paid from APFs exceeds the limits set for the Commander, USARCS.

    (b) Finality of settlement. A determination made by a claims settlement authority on a claim processed under subpart D of this part is subject to suit. A claim processed under subparts C or F of this part may be appealed. Claims processed under subparts C, D, E, H, or J of this part, or AR 27-20, chapter 11 may be reconsidered in accordance with the sections addressing reconsideration in those subparts (or paragraphs in the case of Chapter 11).

    Payment of claims generated by acts or omissions of NAFI employees.

    (a) The settlement or approval authority will forward the appropriate payment documents to the office listed in DA Pam 27-162, paragraph 2-80h, for payment.

    (b) Reimbursement to a foreign country of the United States' pro rata share of a claim paid pursuant to an international agreement will be made from NAFs.

    Claims involving tortfeasors other than nonappropriated fund employees: NAFI contractors.

    AAFES concessionaires and NAFI contractors, such as entertainment performers or groups, carnival operators, and fireworks displayers are considered independent contractors and claims arising from their activities should be disposed of as set forth in DA Pam 27-162, paragraph 2-15f. If a dispute arises as to the availability of liability or workers compensation insurance the claims should be referred to AAFES Dallas (see address in § 536.30(e)(4)) or the Central Insurance Fund, U.S. Army Community and Family Support Agency as applicable.

    Claims involving tortfeasors other than nonappropriated fund employees: NAFI risk management program (RIMP) claims.

    The risk management program (RIMP) is administered by the U.S. Army Community and Family Support Center under the provisions of AR 215-1 and AR 608-10 (Family Child Care Provider Claims). Providers in order to encourage authorized personnel, that is, military and civilian employees, to use the family child care program and sports equipment, such claims are processed in a manner similar to NAFI claims in §§ 536.146 through 536.152 of this subpart. Certain claims are payable from nonappropriated funds even though the U.S. is not liable under the FTCA or the MCA as the tortfeasor is not an appropriated fund or nonappropriated fund employee.

    Claims payable involving tortfeasors other than nonappropriated fund employees.

    (a) Non-NAFI RIMP claims can arise from the activities of:

    (1) Members of NAFIs or authorized users of NAFI sports equipment or devices for recreational purposes, while using such property, except real property, in the manner and for the purposes authorized by DA regulations and the charter, constitution, and bylaws of the particular NAF activity.

    (2) Family child care providers, authorized members of the provider's household and approved substitute providers while care under the family child care program is being provided in the manner prescribed in AR 608-10, except as excluded below. Such claims are generally limited to injuries to, or death of, children receiving care under the family child care program that are caused by the negligence of authorized providers. Claims arising from the transportation of such children in motor vehicles and claims involving loss of or damage to property are not cognizable.

    (b) An ACO or a CPO will ask the Commander USARCS for an advisory opinion prior to settling any non-NAFI RIMP claim where the person whose conduct generated liability does not fall clearly within the categories listed above. Such authorities may also ask, through the Commander USARCS, for an advisory opinion from the U.S. Army Community and Family Support Center prior to settling any claim arising under paragraph (a)(2) of this section, where it is not clear that the injured or deceased child was receiving care within the scope of the family child care program.

    (c) Where liability has been determined to exist for both non-NAFI RIMP and APF activities, liability will be apportioned between the two activities.

    (d) The total payment for all claims (including derivative claims), arising as a result of injury to, or death of, any one person is limited to $500,000 for each incident. Continuous or repeated exposure to substantially the same or similar harmful activity or conditions is treated as one incident for purposes of determining the limits of liability.

    Procedures for claims involving tortfeasors other than nonappropriated fund employees.

    (a) Reporting. Non-NAFI RIMP claims (regardless of the amount claimed) and incidents that could give rise to non-NAFI RIMP claims will be reported to USARCS and the Army Central Insurance Fund immediately.

    (b) Investigation. ACOs and CPOs are responsible for the investigation of non-NAFI RIMP claims. Such investigation will be closely coordinated with program managers responsible for the activity generating the claim. Close coordination with USARCS is also required, and USARCS will maintain mirror files containing the investigative materials of all actual and potential claims.

    (c) Payment. Non-NAFI RIMP claims will be transmitted for payment to: The Army Central Insurance Fund, ATTN: CFSC-FM-I, 4700 King Street, Alexandria, VA 22302-4406.

    (d) Commercial insurance. The provisions of § 536.148(d) also apply to claims arising under this section, except that in claims involving family child care providers, a claims investigation will be conducted regardless of whether commercial insurance exists.

    Start Printed Page 46303
    Settlement/approval authority for claims involving tortfeasors other than nonappropriated fund employees.

    (a) Settlement authority. TJAG, TAJAG, and the Commander USARCS are authorized to approve in full or in part, or deny a non-NAFI RIMP claim, regardless of the amount claimed, except where an apportioned amount to be paid from APFs exceeds their monetary authority and the action of the Attorney General or Assistant General Counsel is required as set forth in § 536.151(a).

    (b) Approval authority. (1) The staff judge advocate, Commander or chief of a command claims service, and a head of an area claims office are authorized to approve in full or in part non-NAFI RIMP claims presented in the amount of $50,000 or less, provided the acceptance is in full settlement and all claims and potential claims arising out of a single incident do not exceed $100,000.

    (2) The above authorities are not delegated authority to deny or make a final offer on a claim under this section. Claims requiring such action will be forwarded to the Commander USARCS with an appropriate recommendation.

    (c) Finality of settlement. A denial or final offer on a non-NAFI RIMP claim is final and conclusive and is not subject to reconsideration or appeal.

    End Part End Supplemental Information

    [FR Doc. 06-6789 Filed 8-10-06; 8:45 am]

    BILLING CODE 3710-08-P

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Document Information

Published:
08/11/2006
Department:
Army Department
Entry Type:
Proposed Rule
Action:
Proposed rule; request for comments.
Document Number:
06-6789
Dates:
Comments submitted on or before October 10, 2006 will be considered.
Pages:
46259-46303 (45 pages)
Docket Numbers:
Docket No. USA-2006-0022
RINs:
0702-AA54
Topics:
Claims, Government employees, Military personnel
PDF File:
06-6789.pdf
CFR: (157)
32 CFR 536.1
32 CFR 536.2
32 CFR 536.3
32 CFR 536.4
32 CFR 536.5
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