Army Pamphlet 27-162

21 March 2008

UNCLASSIFIED

Legal Services

Claims Procedures



SUMMARY of CHANGE

DA PAM 27-162
Claims Procedures

This major revision, dated 21 March 2008--

* Restructures by grouping to the extent possible all information on a single topic in one place, and adds cross referencing where it is not. Separates, to the extent possible, policy and procedural guidance, retaining procedure in this publication and moving policy to AR 27-20 ( chaps 1, 2, 13, and 14.)

* Clarifies, streamlines, regroups, and restates information about purpose, roles, and responsibilities within the Army claims system ( chap 1).

* Revises and updates guidance on disclosure of information (para 1-19).

* Revises and updates guidance on disaster claims planning (para 1-21).

* Implements a requirement for preparation of a serious incident report when serious personal injury, death, or major property damage may possibly give rise to a claim against the United States (para 2-1c).

* Adds information about reviewing claims with attention given to compliance with state law requirements (para 2-7b).

* Clarifies the application of the statute of limitations when claims are revised or amended or new claims are filed after denial or final offer (para 2-8).

* Expands the special instructions pertaining to the mirror file system regarding placement of the original claim form upon file retirement (para 2-12c).

* Substantially rewrites guidance on the use of small claims procedures (para 2-14).

* Regroups and updates guidance pertaining to determining the correct statute (para 2-15).

* Restates much of the guidance pertaining to claims by contractors for loss or damage to their property (para 2-15g).

* Clarifies and expands much of the guidance pertaining to postal claims (para 2-15i).

* Adds guidance on how to process claims resulting from damage to rental vehicles (para 2-15k(2) and 2-62b).

* Adds guidance on how to determine if certain claims should be paid as trespass or real estate claims (para 2-15m(1)).

* Revises, updated, and expanded guidance pertaining to the Meritorious Claims Act (para 2-17d(3)).

* Adds more related remedy statutes (para 2-17h).

* Adds guidance pertaining to additional information to elicit during claimant interview when a structured settlement may be possible (para 2-23b(10(g)).

* Adds requirement to use a digital camera for auto accident scene investigations and provides more specific instructions about the pictures that should be taken. Adds discussion and requirements related to vehicle inspections including crash data recorders (black boxes) (para 2-25).

* Substantially revises initial guidance related to premises liability claims (para 2-27a(1) and (2)).

* Adds information pertaining to AR 40-68 and its significance to medical malpractice claims investigations (para 2-34b).

* Adds guidance on notice and inspection requirements for defective medical devices giving rise to a claim (para 2-34l).

* Adds guidance pertaining to the handling of media requests for information about medical malpractice claims (para 2-34i).

* Adds guidance regarding Department of Justice policy requiring that damage to bailed property is excluded by the FTCA exclusion for interference with contractual rights (para 2-39h(6)).

* Adds requirement that where state law mandates that an affidavit of merit or medical expert opinion be included to file a medical malpractice claim, claimant be so informed in writing prior to final action (para 2-49d(5)).

* Adds guidance about Military Claims Act prohibition of claims for a child's loss of a parent's consortium (para 2-55e).

* Adds and updates guidance about the types of losses under wrongful death claims (para 2-55).

* Expands guidance related to calculating the value of a property damage loss (para 2-56b).

* Requires that structured settlement agreements be prepared in coordination with the USARCS representative (para 2-63).

* Clarifies and updates information pertaining to settlement or approval authority (para 2-69).

* Provides instructions for the use of other than standard settlement agreements, including significant revisions to sample settlement agreements posted to the USARCS Web site (para 2-73).

* Provides additional guidance on reaching and tendering final offers (paras 2-74b and c)).

* Adds certain language requirements to be included in final offers in certain circumstances (para 2-75c).

* Updates guidance pertaining to payment documents (para 2-81).

* Clarifies payment limitations and procedures for non-combat activity claims (para 3-3b(1)).

* Clarifies application of the Military Claims Act to claims for rent, utilities, custodial services and incidental damages (para 3-3e).

* Clarifies application of the Military Claims Act to claims arising in the Federal Republic of Germany and Korea (para 3-4a(1)) and restates the preemptive nature of a status of forces agreement (SOFA) remedy for certain claims (para 3-4a(2)).

* Clarifies the limitation of only one claim permitted for wrongful death per incident under the Military Claims Act (para 3-5b).

* Clarifies application of the combat activity exclusion under claims payable under the Foreign Claim Act (para 10-3b).

* Expands information about solatia payments and moves this information from chapter 13 to chapter 10 (para 10-10).

* Increases the settlement authority for heads of area claims office and chiefs of command claims services to pay up to $40,000 (para 11-2d).

* Clarifies the current rule that only the Commander, USARCS of Chief, Personnel Claims and Recovery Division, USARCS can determine that a loss was due to extraordinary circumstances thereby permitting payment up to $100,000 (para 11-2b).

* Changes the rules for processing personnel claims that may have arisen out of the Foreign Military Sales program (para 11-3c).

* Eliminates provisions on special handling of claims from Corps of Engineers personnel in the Middle East and from AMC personnel (para 11-3c).

* Clarifies the rule that if a claimant is transferring from one military service to another, the gaining service is responsible for paying the claim, regardless of which service's funds pay for the shipment of the claimants goods (para 11-4b).

* Permits claims offices to enter other service claimant information into the database (11-4i).

* Changes the rules for processing of claims from soldiers who are absent without leave (AWOL) (para 11-4k).

* Changes the rules for processing soldiers whose goods are lost or damaged in shipment following a sentence to confinement. Such claims will no longer be paid under the Personnel Claims Act but may still be paid under the Military Claims Act if negligence by government personnel caused the loss (para 11-4k).

* Changes the rule for payment under the Personnel Claims Act for damage from balls escaping from the field of play (para 11-5c(3)).

* Establishes a new rule that claims for mold or mildew damage in quarters are not payable under the Personnel Claims Act but may be payable under the MCA (para 11-5c(3)).

* Clarifies the rule on securing high value, easily pilfered item, to make it clear that there is no "double lock" rule. Rather all facts and circumstances must be considered to determine if the claimant acted reasonably in secure stolen items (11-5c(4)).

* Establishes a new rule that it is reasonable to keep a limited amount of sports equipment in the trunk of a privately owned vehicle (POV) for extended periods (para 11-5c(4)(h).

* Clarifies the Army's position that privatized quarters on an installation in the United States may be treated as "assigned or provided in kind" so that losses at those quarters are payable, but advises claims offices to seek guidance on USARCS if they receive such a claim (para 11-5d(1)).

* Includes the requirement that loss or damage to vehicles, even when used for the convenience of the government, is due to extraordinary hazards to be compensable (para 11-5h(1)).

* Excludes losses to vehicles, being used to travel from one permanent duty station to another, from shipment claims for the purposes of maximum allowance tables and insurance requirements (para 11-5h).

* Clarifies rules on claims for loss or damage from Self Procured Moves, whether do-it-yourself-moves of private contracts with commercial moving companies (para 11-5e(2)).

* Clarifies the rule that claims for damage to a POV that is being driven to or from a vehicle processing center for overseas shipment may be payable (para 11-5h(2)).

* Provides new guidance on paying for items that are being held by law enforcement agencies as evidence. Establishes rule that non-essential items will not be considered "lost" to the claimant unless they are held more than 60 days (11-5k).

* Clarifies the rules on paying for damage to vehicles rented on government orders (paras 11-5h(1) and 11-6k).

* Clarifies that only the Commander, USARCS of the Chief, Personnel Claims & Recovery Division, USARCS can determine if "good cause" exists during time of war or armed conflict to extend the two year statute of limitations on filing of Personnel Claims Act claims (para 11-7a).

* Directs the new guidance to the claims offices to make sure claims instructions are clear about what is needed to file a claim to meet the 2-year filing deadline, and what must be filed to fully support a claim (para 11-7b).

* Provides new guidance on which offices should handle claims from Army personnel assigned to embassies (para 11-9e).

* Clarifies the responsibilities of the originating claims office to fully adjudicate claims prior to transfer (para 11-10i).

* States the policy that was announced in 2003 that claimants do not need to file against private insurance on claims for loss or damage to goods in shipment or storage (paras 11-11 and 11-21a).

* States the policy that the carrier has the right to claim salvage on all shipment delivered in the United States, not just domestic shipments (para 11-14j(2)).

* Clarifies the rule on waiver of the maximum allowable limit on the basis of good cause by listing several examples of situations that will normally constitute good cause for waiver (para 11-14b(2)).

* Changes the rule that military uniforms are not depreciated. Depreciation will now be taken on claims for loss of uniforms (para 11-14g(6)).

* Establishes a new rule that claimants do not have to provide substantiation of the value or repair cost for any item on a claim on which the total amount claimed is $500 or less (para 11-14h).

* Clarifies the basis for denying claims because of the claimant failure to give timely written notice of loss or damage during shipment or storage (para 11-14i).

* Moves the guidance on mobile home claims from this pamphlet to the USARCS Web site (para 11-14i(6)).

* Now includes an explanation of the Global POV Contract process for shipping POVs and provides more detailed guidance on processing claims of transit loss or damage to POVs (para 11-14p).

* Increases from $2,000 to $5,000 the amount that claims judge advocates and claims attorneys can approve as emergency partial payments (para 11-18).

* States that the Chief, Office of the Judge Advocate, U.S. Forces Korea (Claims), has the same authority to act on requests for reconsideration as the Commander, USARCS and the Chief, U.S. Army Claims Service, Europe (para 11-20g(3)).

* Clarifies the policy on calculating shared liability with the carrier on Code 5, Code T and Code J shipments (para 11-26b(2)(b)).

* Clarifies the rule that insurance company "hold-backs" on full replacement value policies must be considered when determining whether the claimant has been fully compensated by private insurance (para 11-29c).

* Gives more detailed guidance on resolving direct procurement method (DPM) carrier recovery claims through the contracting officer in the event of an impasse (para 11-32e).

* Gives more detailed explanation of the DPM process for shipping household goods and the liability of DPM carriers (para 11-32).

* Gives more detailed guidance on processing clams for lost or damaged accompanied baggage, including the requirement that claimants must file a claim with the airline, or bus company before filing with the government (para 11-33).

* Changes the cost-effective limit at which recovery claims will be asserted against carrier from $25 to $50 (para 11-35).

* Provides new guidance on recouping payments from claimants, including a new policy that any recoupment action against a claimant who is not on active duty must be sent to USARCS for involuntary collection (para 11-37).

* Implements new procedures for actions to recoup payments from claimants also includes new formats for demand letters and claimants' response that comply with the Federal Debt Collection Act (para 11-37).

* Adds information regarding application of the federal agency test for claims arising at or in connection with non-appropriated fund activity instrumentality activities or facilities (para 12-1f(1)).

* Adds information about investigation of claims arising at family child care provider homes (para 12-9f(2)(a)(1)).

* Revises the current automated procedures for office administration and claims management ( chap 13).

* States importance of identifying the correct claim's statute for purposes of entering claims into one of the automated claims databases (para 13-1e).

* Expands discussion on initial administrative processing of claims from other services (para 13-1g).

* Rearranges, expands, and clarifies procedures for transferring of claims responsibility or files (para 13-2).

* Rearranges, expands, and updates guidance on claims files' organization and maintenance, adding information on establishment of files for potentially compensable events (para 13-3).

* Expands requirement to use certified or registered mail not just on all final actions, but also when sending acknowledgment letters, 30 or 60-day letters, any correspondence that includes HIPAA related documents, and so forth (para 13-5).

* Merges information formerly contained in Chap 13, Section III, Affirmative Claims, into other paragraphs in the chapter designating by subparagraphs when information pertains only to affirmative claims ( chap 13, former Section III).

* Updates guidance on how to close abandoned or withdrawn claims, retaining this information in DA Pam 27-162 and removing the guidance on claims files' retention and disposal to AR 27-20 (para 13-4).

* Provides additional information concerning recovery theories (paras 14-1 and 14-2).

* Provides additional instructions regarding third party liability assertions of property damage claims for non-appropriated fund property (para 14-3c).

* Requires use of the Affirmative Claims Management Program database (para 14-6c).

* Adds additional claims investigation techniques and resources (para 14-8).

* Clarifies methodology for military pay calculations (para 14-9b(3)(c)).

* Documents higher settlement amounts for compromise, waiver, or termination of affirmative claims (para 14-11).

* Distinguishes between medical care recovery waiver and compromise (para 14-11b).

* Provides instructions for actions to take when tortfeasors are charged with crimes (para 14-12c).

* Provides additional instructions on installment payments (para 14-12a).

* Provides a much more complete listing of required and related publications and prescribed and referenced forms (app A).

* Adds appendix B, a complete list of all claims processing resources grouped according to their application and subject area as relates to claims processing (app B).

* Updates and corrects all references to the U.S. Code, regulatory and administrative materials throughout the publication.

* Removes materials previously included as figures and refers the reader to the USARCS Web site where these materials are now posted. Reviews and updates all resource materials throughout the publication.

* Examines thoroughly the impact of the Health Insurance Portability and Accountability Act (HIPAA) on claims processing policies and adds text references to and discussion of HIPAA where deemed necessary throughout the publication.



Chapter 1
Army Claims System

1-1. Purpose

a. Purpose. This publication explains and implements the policies contained in Army Regulation (AR) 27-20 . It describes the procedures and responsibilities for investigating, processing, and settling claims arising from, or related to, military operations and activities against, and in favor of, the United States, under the authority conferred by statutes, regulations, international and interdepartmental agreements and Department of Defense (DOD) directives. This text is intended to ensure that claims are investigated properly, analyzed fully, adjudicated objectively and fairly, and paid or denied; or that collection action is initiated as may be appropriate.

b. Relationship of this publication to AR 27-20. To the extent possible and for ease of reference, the chapter and paragraph numbers in this publication correspond with the chapter and paragraph numbers used in AR 27-20. Complete correspondence is not possible since this publication contains much more information and implementing guidance than does AR 27-20. Readers will find, however, that both texts follow the same general order in presenting their subjects.

1-2. References

Required and related publications and prescribed and referenced forms are listed in appendix A .

1-3. Explanation of abbreviations and terms

Abbreviations and special terms used in this regulation are explained in the glossary .

1-4. Claims authorities

a. General. See AR 27-20, paragraph 1-4 for a complete list of federal statutes under which claims are processed under this publication.

b. Additional authoritative materials for claims processing. 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 and authoritative materials relevant to claims processing under this publication (as well as under AR 27-20) see appendix B .

1-5. Command and organizational relationships

See also AR 27-20, paragraph 1-5 .

a. Creation of an overseas command claims service.

(1) When the Army Command (ACOM), Army Service Component Command (ASCC), or equivalent Staff Judge Advocate (SJA) office determines that a command claims service is warranted to support a deployment, the MACOM or SJA office should request that the Commander USARCS establish a command claims service. A command claims service is normally created only when there are large numbers of active foreign claims commissions (FCCs) in the jurisdictional area that need a single point of contact for service and support and whose activities need to be coordinated to ensure consistency. The request should contain the following information:

(a) Nature and duration of mission.

(b) Number of troops.

(c) Assessment of the claims situation.

(d) Supplemental claims requirements.

(e) Justification for an appointment of a command claims service rather than an FCC.

(2) Send the request to the address shown below. The MACOM or SJA will provide continued updates on the claims mission and requirements.

Commander
U.S Army Claims Service
ATTN: JACS-TCF
4411 Llewellyn Avenue
Fort Meade
Maryland
20755-5360
USA

b. Field offices. The Commander USARCS will designate area claims offices (ACO) around the world as well as command claims services for major overseas theaters. The head of an ACO may designate a claims judge advocate (CJA) or claims attorney to act in the capacity of a claims processing office (CPO) with or without approval authority. Because USARCS maintains sole control of funding codes, the Commander USARCS must approve the creation of any new office that has payment approval authority. AR 27-20, paragraph 1-5f , authorizes heads of ACOs to create four types of CPOs. CPOs are those subordinate claims offices within an ACO's geographic area that have approval authority or investigative responsibility. The first three are permanent; the fourth is intended as a temporary, event-specific extension of the ACO. These claims offices are —

(1) CPOs without approval authority.

(2) CPOs with approval authority.

(3) Medical CPOs.

(4) Special CPOs.

c. Area claims offices. The ACOs and their subordinate CPOs have geographic areas of responsibility within the continental United States (CONUS) and command areas of responsibility overseas. See the USARCS Web site hosted on JAGCNet ( https://www.jagcnet.army.mil ), at "Claims Resources," VI, Tables Listing Claims Offices Worldwide. Eight separate tables are shown, titled: Single-Service Responsibility Assignments, Army National Guard Offices, Central and South American Offices, Army Corps of Engineers Offices, European Claims Offices, Korean Claims Offices, Receiving State Offices in Germany and Korea, and Continental U.S. Claims Offices.

d. Reserve Judge Advocates. To ensure the best possible Army claims program, CONUS ACOs will whenever possible use Reserve JAs located in their areas for investigations and legal research. Reservists may earn retirement points for working on such projects. USARCS and the National Personnel Records Center in St. Louis, Missouri (314-801-9250 or cpr.center@nara.gov ), may assist in identifying Reservists with claims experience.

1-6. Designation of claims attorney

See also AR 27-20, paragraph 1-6 .

a. Claims approval authority. A settlement authority may delegate to a CJA or a claims attorney the authority to approve a claim for payment in whole or in part. Authority to deny, make a final offer or reconcile prior to final action may not be delegated. A JA is automatically qualified to approve claims upon assignment to a claims position provided the amount of monetary authority is stated in writing either by an office directive or individual delegation. A DA civilian attorney is not automatically qualified to approve claims and must be designated as set forth below.

b. Designations. The head of a command claims service or an ACO should designate, in writing, each CJA, claims attorney, or subordinate CPO having payment approval authority. A sample memorandum designating a claims attorney, including statutory and applicable monetary limits, is posted on the USARCS Web site at "Claims Resources," II, a., no. 23.

1-7. The Judge Advocate General

The Judge Advocate General (TJAG) has supervisory authority over USARCS. The Deputy Judge Advocate General (DJAG) is the settlement and appellate authority for claims under the Military Claims Act (MCA) and National Guard Claims Act (NGCA) where the claimed amount is not more than $100,000. DJAG advises the Secretary of the Army's (SA's) designees on MCA, NGCA, Army Maritime Claims Settlement Act (AMCSA), National Agreements Claims Act (NACA), and Foreign Claims Act (FCA) claims on which the SA is the settlement authority. See also AR 27-20, paragraph 1-7 .

1-8. Army claims mission

The Army Claims system began early in World War II when the MCA and FCA were passed to ensure that the presence of huge numbers of troops would be acceptable both within the United States (U.S.) and in foreign countries by providing a system for compensating torts. By the time of the passage of the Federal Tort Claims Act (FTCA), the first statute to provide a limited waiver of sovereign immunity with access to federal courts, the Army system was well developed and successful as the mission was interpreted from the outset to follow the Congressional edict to pay meritorious claims. The policy has continued to the present and has resulted in a highly developed system which engages all levels of command through over 100 field offices under TJAG and USARCS. Deployments, maneuvers, and disasters demand basic teamwork. During natural disasters the Personnel Claims Act (PCA) must be used to compensate service members for loss of things essential to performing their duties and sustaining their families. PCA losses must be compensated quickly and fairly with the same goal in mind. See also AR 27-20, paragraph 1-8 .

1-9. Responsibilities of the Commander, U.S. Army Claims Service

The Commander, USARCS is director of the Army claims system and is responsible for publishing and interpreting AR 27-20 and this Pam as well as providing policies and guidelines through other media. The commander decides which areas of geographic responsibility are assigned to field offices as well as which offices will process specific claims. The commander has the authority to grant exceptions from AR 27-20 not in violation of any law or other publication that has the force of law. This paragraph is supplemental information: a complete outline is located at AR 27-20, paragraph 1-9 .

1-10. Command claims services

The commander of a major command through his SJA may institute a claims service to process claims arising in foreign countries with the concurrence of the Commander, USARCS. The service may be an integral part of the commander's office or a separate organization. In either case a JAGC field grade officer should be designated as chief or commander unless the SJA wants to be chief. SJAs are responsible for claims operations within their command theater of operations or outside that area wherever the predominant troop is from their area of deployment. Where indicated, SJAs should seek single service responsibility through the theater commander from the Office of the General Counsel of the DOD, with concurrence of the Commander USARCS. This paragraph supplements AR 27-20, paragraph 1-10 information where there is a complete list of responsibilities and operations of command claims services.

1-11. Area claims offices

This paragraph supplements AR 27-20, paragraph 1-11 where there is a complete listing of responsibilities and operations of area claims offices.

a. The ACO is the primary office that investigates and processes claims. It is staffed with qualified legal personnel under the supervision of the SJA, command JA, chief counsel, or U.S. Army Corps of Engineers (COE) district or command legal counsel.

b. Heads of ACOs may designate offices from other installations within their areas as CPOs to receive, investigate, and process claims. Only offices having a CJA or claims attorney may be designated as CPOs with payment approval authority. Before a CPO may be granted payment approval authority, the Commander USARCS must approve the designation and furnish a command and office code. Where a proposed CPO is not under the command of the ACOs parent organization, a support agreement or memorandum of understanding between the affected commands may accomplish this designation.

1-12. Claims processing offices

The responsibilities and operations of various types of claims processing offices are discussed at AR 27-20, paragraph 1-12 .

1-13. Chief of Engineers

See also AR 27-20, paragraph 1-13 .

a. All engineer districts are ACOs and deal directly with the Commander, USARCS on matters of claims adjudication and processing, including mirror file requirements, unlike ACOs in other ACOMs or ASCCs. However, the Chief of Engineers General Counsel has a major role in litigation and must be kept abreast of claims likely to be litigated. FTCA claims have a mandatory six-month period for administrative resolution before claimants can file suit. Such claims therefore cannot be routed to USARCS through COE channels. COE offices must send the original file directly to USARCS and route an informational copy to their higher authority.

b. COE personnel should be used to provide expert and technical advice on claims arising out of both COE and non-COE activities and operations. Typically, the claim may involve damage to a building, bridge, road or other man-made structure or real property. The requesting ACO or CPO should provide temporary duty (TDY) funding but such assistance is otherwise not reimbursable.

1-14. Commanding General, U.S. Army Medical Command

See also AR 27-20, paragraph 1-14 .

a. Several agreements concerning the designation and utilization of medical claims judge advocates, medical claims attorneys, and medical claims investigators require dedication of such personnel to the investigation and processing of medical malpractice claims, as well as affirmative claims under AR 27-20, chapter 14 . Two agreements between the JAGC and the U.S. Army Medical Department, dated June 1984 and June 1993, are posted on the USARCS Web site at "Claims Resources," I, f, nos. 1 and 2. These duties take priority over other duties due to the statutory time limits placed on the processing or FTCA claims. The early recognition and investigation of potentially compensable events (PCEs) in accordance with AR 40-68 and close relationships with the medical and hospital staff are keys to timely processing.

b. Army Medical Treatment Facilities (MTFs) are charged with furnishing assistance in conducting independent medical examinations (IMEs) for claimants against the Army regardless of whether the claimant is an eligible beneficiary. Authority for such assistance is found in AR 40-400, paragraph 3-47 . These examinations will be conducted after the requesting claims personnel furnish all medical records or other pertinent data. The response will be in writing and cover specific questions asked by the requestor. Claimants' attorneys are excluded from the actual examination itself.

1-15. Chief, National Guard Bureau

See also AR 27-20, paragraph 1-15 . The designated point of contact for each state should deal directly with only one ACO. Where there is more than one ACO located in a state, the designated ACO should serve as liaison for other ACOs located in that state. The responsible ACO should ensure that the names and locations of all unit claims officers as provided by the National Guard point of contact are available for use by ACOs and CPOs. ACOs and CPOs will deal directly with National Guard unit claims officers where indicated. See the USARCS Web site for a state-by-state list of National Guard active duty liaison offices and claims offices at "Claims Resources," VI, a.

1-16. Commanders of major Army commands

See also AR 27-20, paragraph 1-16 . Prior to a maneuver, the responsible SJA of the command planning the maneuver should ensure that adequate funds are provided to pay for damages or losses that may occur on land whose use is obtained by permit by the designated COE district. In addition, property damages or losses should be paid for or eliminated by the use of troop labor and equipment. This approach does not require using claims procedures under AR 27-20 . Only if it is unsuccessful is there a need for filing of written claims under the MCA. See paragraph 2-26a .

1-17. Claims policies

See AR 27-20, paragraph 1-17 for important claims processing policies of general applicability to all claims.

1-18. Release of information policies

See also AR 27-20, paragraph 1-18 . In an Army claims setting, the responsible attorney may not release classified material or material that violates the Privacy Act, 5 U.S.C. § 552a, or other laws or regulations. Relevant statutes include the Privacy Act, 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. 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.

a. Information to be gathered as part of a serious incident investigation. Prior to filing a claim prospective claimants frequently request Military Police (MP) reports, Army Accident Reports, Criminal Investigation Division (CID) reports, medical records, Inspector General (IG) reports, AR 15-6 , Investigations and other documents, some of which may be non-exempt in whole or part under the FOIA. These requests are processed by the creating activity or agency (for example, the chief of staff, adjutant, MTF records administrator, provost marshall, CID, safety officers). Claims personnel should establish a procedure to ensure that they are informed of the request and furnished a copy of the document released for claims purposes, including affirmative claims. For example, requests by attorneys or subjects of records for copies of medical records should be coordinated with claims personnel. If upon inquiry the requester states that he or she intends to file either a claim against the U.S. or an affirmative claim, claims personnel should create a file which includes a copy of the requested records and begin an investigation. See AR 40-68 and AR 40-400 .

b. Information gathered after filing a claim.

(1) Release of documents indicated in a above should be controlled by claims personnel once they become part of the claims file. The guiding principle is that settlement of claims is a voluntary act by the claimant and necessitates a cooperative environment that engenders the free exchange of information and evidence when the claimant and his attorney are cooperative. Material releasable under the Federal Rules of Civil Procedure (Fed. R. Civ. P.) as well as unclassified attorney work product should be released in a free exchange of information, where the claimant or his or her attorney are cooperative, with a view to settling a claim or avoiding unnecessary litigation. Keep a list of all documents released to maintain compliance with HIPAA. At the outset of a claims investigation claimants must execute an authorization for the Army to obtain copies of medical records. Later authorizations may also be required as later sources of care are discovered. In addition, similar releases, executed by consulting physicians, are also required under HIPPA for medical records to be forwarded for expert review and medical consultations. Formats for these releases and assurances are posted on the USARCS Web site ("Claims Resources," II, c, nos. 15 and 16). See also paragraph 2-7 , claims acknowledgment.

(2) Generally, work product may be released or withheld by the attorney who gathered the information under the work product exemptions under FOIA. Hickman v. Taylor, 329 U.S. 495 (1987), Fed. R. Civ. P. 26(b)(3), 5 U.S.C. § 552(b)(5) FOIA exemptions. Work product includes written recordings of interviews, statements, memoranda, briefs, correspondence, documents containing mental impressions or personal notes written by an attorney or under an attorney's direct control. Unit claims officers' reports are not work product and not exempt.

c. Quality Assurance Reports.

(1) Medical QA records are both confidential and privileged ( see 10 U.S.C. § 1102). Health care providers (HCPs) and any other participants in QA activities are precluded from testifying about QA records, committee findings, actions, opinions, and recommendations. When asked for advice on the release of medical records, CJAs or claims attorneys should review the statute carefully to determine if the record is a QA document. Congress sought to remove the courts' discretion by legislating that QA records are not subject to discovery and may not be introduced into evidence. QA records are also exempt from release under FOIA. Therefore, CJAs and claims attorneys must carefully consider the information they release to claimants or their attorneys during settlement negotiations. Once a CJA or claims attorney obtains QA information, further disclosure may be made only to those persons or entities statutorily authorized to obtain it. Investigation reports conducted for other than QA purposes are discoverable and not exempt from release. Such an investigation may be conducted pursuant to AR 15-6 , either by the MTF commander or MEDCOM. It may include witness statements given either to the investigator or written separately and used by the QA committee. The fact that such material is included in the QA file and marked as a QA document does not preclude its release unless the investigation is conducted specifically for QA purposes, AR 40-68, appendix B-4 .

(2) The QA statute lists specific exceptions to the general prohibition against disclosure of QA information. These exceptions permit disclosure to Army claims personnel for use in investigating and processing claims. However, if Department of Justice (DOJ) approval of a settlement is necessary, QA documents may not be used to support the request. Where DOJ or the U.S. Attorney specifically requests QA information, the request must be based on absolute necessity and release coordinated with Army Litigation Center.

d. Doctor or patient disclosures. Doctor or patient disclosures are discoverable by claims personnel and not exempt. While a treating physician or dentist has a responsibility to keep a patient or patient's family fully informed during and after treatment, such disclosures should not constitute judgments about either past or ongoing medical care. Physicians and dentists are legally obligated to make full and frank disclosure even when doing so could give rise to a claim, AR 40-68 , paragraph 12-4e(4). They are not obligated, however, to inform the patient that the medical treatment was negligent or that the previous HCP did not meet the standard of care. Such statements are admissible in evidence.

e. Presidential, congressional or inspector general inquiries. When responding to presidential, congressional or inspector general (IG) inquiries about an actual or potential claimant, ACOs should screen their responses to ensure that they contain only factual material, not admissions of negligence or failure to meet standards of care. This requires close coordination with the IG and commander's designees, who also respond to such inquiries. Many attorneys who are familiar with procedures encourage their clients to make inquiry with a view toward obtaining admissions against interest that are admissible in evidence. This guidance should in no way detract from the duty to reply honestly and completely.

1-19. Single-service claims responsibility

See also AR 27-20, paragraphs 1-19 , 1-20 , 2-13 , and 13-2 as well as this publication at paragraphs 1-20 , 2-13 , and 13-2 .

a. Delegation of claims responsibility. The Army is responsible for processing DOD claims; see Department of Defense Directive (DODD) 5515.9 . The ACOs should obtain a list of all DOD and Army installations and activities in their area. This includes: active installations; posts and depots; Army Reserve and Army National Guard units; armories; training sites; recruiting battalions; Reserve Officer Training Corps (ROTC) units; DOD contracting activities; Defense Reutilization and Marketing Offices (DRMOs) and Department of Defense Dependent Schools (DODDS) (which may be located on U.S. Navy or Air Force bases); and Defense Investigative Agencies. Department of Defense Commissary Agency (DECA) claims are governed by a Memorandum of Understanding (MOU), which imposes claims responsibility on the post or base at which the incident occurred. Tables listing claims offices worldwide are posted to the USARCS Web site at "Claims Resources," VI.

b. Assigned areas. Single-service claims processing responsibility has been assigned by Department of Defense Instruction (DODI) 5515.08 .

c. Unassigned areas. In the absence of assigned claims responsibility in certain countries, unified and specified commanders may when necessary implement contingency plans and as an interim measure only, assign single-service claims responsibility in accordance with the DOD General Counsel's guidance.

d. Notification to U.S. Army Claims Service. The SJAs and other claims authorities should inform the Commander, USARCS whenever the Army has been assigned single service responsibility for a foreign country. This ensures that USARCS will receive information enabling it to respond efficiently and effectively to inquiries on policy issues from the legal staff of the Joint Chiefs of Staff or other agencies and field commands. Additionally, USARCS can advise field claims offices of any changes in the assignment of single-service responsibilities and provide required assistance.

e. Where another military department has single-service claims responsibility. Claims against and in favor of the United States resulting from activities of the U.S. Army or DA Soldiers or civilian employees in a country for which another military department has been assigned single-service claims responsibility will be investigated by the Army and referred to that department for settlement.

f. Inquiries. Field claims offices may address questions concerning single-service responsibility to the Commander, USARCS. It is advisable to contact the Foreign Torts Branch to ascertain issues that may be of import to an assigned area.

1-20. Cross servicing of claims

This topic has a direct relationship to "single servicing" and transfer of claims among armed service branches. Accordingly, please see AR 27-20, paragraphs 1-19 , 1-20 , 2-13 , and 13-2 as well as this publication at paragraphs 1-19 , 2-13 , and 13-2 .

1-21. Disaster claims planning

a. Definition. A disaster is an occurrence that results in large numbers of personal injuries or deaths, or extensive property loss or damage, as a result of Army or DOD operations or activities. Examples include an explosion of ordnance, release of toxic chemicals or nuclear materials, fire, or the crash of an Army aircraft (including North Atlantic Treaty Organization aircraft in the U.S.). Natural disasters such as a hurricane, tornado, or flood are not included because they are not the result of Army or DOD operations and activities, even though the Army is required to participate in federal response. Likewise, civil disturbances are not included for similar reasons. Other procedures may apply if a claim is being processed under Personnel Claims, chapter 11 .

b. Responsibility. The ACO in whose geographic area a disaster occurs is responsible for the processing and settlement of claims unless the Commander USARCS is responsible.

c. Requirements. The ACOs will develop and publish a disaster plan and furnish a copy to USARCS. In the event of a disaster, a quick response is required. The plan will be staffed within the installation to ensure that staff agencies are aware of their responsibilities. The plan should include that the servicing Defense Finance and Accounting Service (DFAS) office will be requested to establish a procedure to make immediate payments. The material and documents required in the Checklist of Disaster Readiness Materials and Supplies will be kept readily accessible. See the checklist posted on the USARCS Web site at "Claims Resources," II, A, no. 2.

d. Actions.

(1) Notice of the nature and extent of the disaster will be given by the ACO to the USARCS area action officer. If necessary, the CJA will visit the scene to determine the cause and extent of the damage, which service is responsible, and whether a claims team will be deployed. Prior to deployment of a team, USARCS will be informed to determine if additional support is needed. A decision will be made as to whether claims will be paid and under which statute. Any advance payments must be made under the MCA or FCA under the conditions set forth in paragraphs 2-71 and 11-18 based on the theory that the claims arise out of noncombat operations. A special claims processing office will be established.

(2) Assistance from local authorities will be obtained in selecting and establishing a claims office. Its location will be widely publicized through local media and local authorities. Claims will be filed, investigated and processed as set forth in chapters 2 and 11 .

(3) Claims officers must be appointed as quickly as possible through the area claims office and the appointed officers must be deployed to the location of the disaster to establish a claims office.

(4) The appointed claims officers must be equipped with cash for immediate payment of claims. Alternatively, they must be accompanied by a financial officer who is equipped with cash and authorized to pay claims. Three points of contact need to made immediately to ensure that cash is made available. First, contact Defense Finance and Accounting Service (DFAS) in Rome, NY and the USARCS budget office. Second, notify the Director of Military Pay Operations, if one is nearby. Next, draft a Paying Agent Memo in the format of the sample posted on the USARCS Web site at "Claims Resources," II, a, no. 4. The sample format for this memo must also be included in the Area Claims Office Disaster Readiness Kit. DFAS will provide instructions as to whom the memo should be addressed and submitted, as this may vary from case to case. A list of procedures to ensure timely payment of claims in the event of a natural disaster or other emergency is also posted on the USARCS Web site, at "Claims Resources," II, a, no. 3.

(5) If the disaster is in an area where a SOFA exists, the receiving State will process the claims; however, the U.S. will still provide the cash for payments.

1-22. Claims assistance visits

a. Purpose. The commanders of USARCS and the command claims services have initiated claims assistance visits (CAVs) to encourage administrative uniformity within claims offices, to share successful time and work management practices among offices, and to ensure that claimants receive consistent, high-quality service throughout the Army. These visits emphasize assistance rather than inspection and are conducted at field claims offices.

b. Scheduling. USARCS and command claims services will schedule visits with the SJA of the particular installation. The visits are made periodically, in response to specific requests from the field, or when review of field office operations indicates an apparent need.

c. Focus. During a CAV, the team examines all aspects of claims office management (see the Claims Assistance Visit Checklist posted on the USARCS Web site at "Claims Resources," II, a, no. 1.

d. Completion. After the visit, the CAV team members provide the SJA with an out briefing on the strengths and weaknesses found as well as an opportunity for immediate feedback and clarification. Upon their return to USARCS or the command claims service, CAV team members prepare a written after-action report, submitting one copy each to the commander and the installation SJA. Information from these reports may be provided to OTJAG for use on Article 6 of the Uniform Code of Military Justice, visits.

e. Claims assistance visits in Europe. In Europe, U.S. Army Claims Service Europe (USACSEUR) (https://claimseurope.hqusareur.army.mil) conducts periodic claims management evaluations, conducted in accordance with subparagraphs a through d , above, to help field claims offices evaluate their operations. These evaluations may be based on a field claims office's or SJA's need or request. However, USACSEUR visits each office at least once every two years and provides after-action reports to the CJA, the appropriate SJA and the Chief, Personnel Claims Division, USARCS.

f. Claims assistance visits in the Republic of Korea. In the ROK, the Office of Judge Advocate, U.S. Forces Korea (Claims) (FKJA-CL) (http://8tharmy.korea.army.mil/ClaimsSvc/) conducts quarterly CAVs to the ACOs and CPOs located in ROK, Japan, and Okinawa.

1-23. Annual claims award

a. Procedure. At the end of the fiscal year USARCS will distribute forms for completion by all claims offices desiring to be considered for an award for the quality and quantity of work performed by all members of the command claims services, both AAOs or CPOs. An office is eligible for consideration even if it only performs one function, for example, a medical CPO.

b. Criteria. The evaluation considers the type and number of personnel dedicated to processing claims, both personnel and tort as well as affirmative claims. Criteria include processing time and method of ensuring a quick, fair result. Claims prevention is an important factor.

Chapter 2
Investigation and Processing of Claims

Section I
Claims Investigative Responsibility

2-1. General

a. Chapter overview. This chapter addresses investigating, processing, evaluating, negotiating and settling tort and tort-related claims. Investigating, evaluating, and negotiating chapter 14 affirmative claims should be conducted in accordance with this chapter as applicable. Chapter 11 sets forth procedures for processing personnel claims. In certain instances, claims initially considered under the Personnel Claims Act (PCA) must be considered in tort. In these instances, follow the procedures in this chapter. See also paragraphs 1-20 of this publication and of AR 27-20 , regarding cross servicing of claims.

b. Teamwork on investigations. Claims investigation is a team effort between the U.S. Army Claims Service (USARCS) area action officers (AAOs), area claims offices (ACOs), including U.S. Army Corps of Engineers (COE) districts, claims processing offices (CPOs) and unit claims officers. Investigation should begin immediately after an incident that may give rise to a claim, also called a potentially compensable event (PCE). See AR 27-20, paragraph 2-2a for a definition of a "claims incident." Affirmative claims require investigation whenever a U.S. Soldier, active or retired, a civilian employee, or their family members are injured or killed by a third-party tortfeasor and receive medical care at government expense, or when a third party destroys, damages or takes government property. The claims investigation gathers information both adverse and favorable to the government; it should include an interview of the claimant(s) when possible.

c. Serious incident reports. A directive should be published requiring serious claims incidents to be reported and the method of investigation discussed with the ACO from the onset. See the USARCS Web site at "Claims Resources," II, a, no. 24 for a sample format for an instructional memorandum for how to report PCEs. The ACO will furnish a copy of such directive to the Commander USARCS. A serious incident report describes serious personal injury, death or major property damage from which a claim for or against the U.S. Army may arise. Such incidents will be reported as a high priority to the USARCS AAO to determine whether immediate action, including the use of experts, is required to protect the U.S interest, to minimize the impact and to determine whether a disaster claims plan should be implemented. See paragraph 1-21 for more information on disaster claims planning. This requirement applies worldwide to all units and claims processing offices and medical claims processing offices, as well as to any other Department of Defense (DOD) or Army organization. In addition, this requirement applies to the injury or death of active duty or retired service members or their family members as well as to civilians treated at U.S. expense. The report shall contain the date and place of the incident, the type of incident (for example, vehicle collision, air crash, medical incident, and so forth), the organization involved, the names and status of the injured parties, and the nature and extent of the damage.

d. Geographic concept of responsibility. See also paragraphs 1-19 of AR 27-20 and of this publication describing single-service claims responsibility.

(1) The ACO, or CPO where delegated, in whose geographic area a claims incident occurs has primary responsibility for initiating the investigation. When Department of the Army (DA) or DOD personnel are assigned to an organization located in another ACO area, the investigators involved must conduct a joint investigation; the primary responsibility remains with the ACO in whose area the incident occurred unless a formal transfer is arranged. Worldwide geographic areas of responsibility are shown in tables posted on the USARCS Web site at "Claims Resources," VI, Tables Listing Claims Offices Worldwide.

(2) When an incident involves several ACOs (for example, when personnel travel in a convoy or on temporary duty (TDY) status or fly over another ACO's area), a joint investigation is required. However, the ACO of the area in which the incident occurred retains responsibility. A more difficult situation arises when a medical malpractice incident occurs at one medical treatment facility (MTF) and the patient is transferred to and treated at an MTF in another area. The second MTF may belong to another armed force or it may be a civilian care facility. Frequently, the actual site of the claims incident is discoverable only after reviewing all the medical records. A transfer of responsibility may be in order. See section III, Processing of Claims. If serious injury or major property loss involves more than one ACO, consult the AAO and assign responsibility accordingly.

2-2. Identifying claims incidents both for and against the government

A claims investigation begins when claims personnel learn of an incident that has the potential for liability, not when the claim is filed. The ACO or CPO should use all available information sources to learn of potential claims.

a. Reports from persons who know about the incident are the best source of information about potential claims. Claims offices that enjoy strong relationships with other units and activities on the installation or in their geographic area of responsibility have the best chance to learn about an incident right after it happens. It is also important for claims personnel to coordinate within the Office of the Staff Judge Advocate (OSJA).

b. At a minimum, the CJA, claims attorney or other qualified person should screen the following sources of information daily to discover potential claims:

(1) Military Police (MP) blotters.

(2) The MP and Criminal Investigation Division (CID) reports forwarded for coordination to the military justice section of the local Staff Judge Advocate office.

(3) Serious incident reports.

(4) Hospital emergency room logs and composite health care system (CHCS) reports.

(5) Local newspapers.

(6) Congressional and Presidential inquiries.

(7) DA 4106 (Quality Assurance/Risk Management Document) used in Army MTFs.

(8) Inspector General (IG) inquiries and investigations (maintaining a good relationship with this office is especially important).

(9) Safety reports.

(10) Attorney requests for documents and records.

c. Potential claims are often discovered when claimants or their attorneys request claim forms or medical records. Always ask why they are requesting a claim form or medical record and obtain as much information as possible about the potential claim. If the claim is obviously not compensable, inform the claimant or the attorney without delay. For example, if the potential claim is barred by the Feres doctrine (Feres v. United States, 346 U.S. 135 (1950)), let the claimant or attorney know this immediately and explain your position. This practice helps the civilian attorney evaluate the decision to represent the claimant and file a claim. This advice should be given only by a claims judge advocate (CJA) or claims attorney, who should prepare a memorandum of the conversation for the potential claim file. Never advise a potential claimant or attorney not to file a claim but rather state that a proper claim must be filed in order to bring suit under the Federal Tort Claims Act (FTCA) or an appeal under the Military Claims Act (MCA), National Guard Claims Act (NGCA) or the Foreign Claims Act (FCA).

2-3. Delegation of investigative responsibility

a. U.S. Army Claims Service. The USARCS maintains technical supervision over all claims offices and provides guidance on specific claims. It may do so at any point in the claims process. Its guidance may cover the method of claims investigation and disposition, particularly when the amount claimed is beyond an ACO's or CPO's monetary jurisdiction. An ACO or CPO may not act independently to settle or transfer such a claim unless USARCS has specifically delegated to it the authority to do so. USARCS acts through the AAO who has responsibility for an ACO's or CPO's geographic area. USARCS AAOs, ACOs, and CPOs should develop a close working relationship with each other that encourages an atmosphere of mutual cooperation, creating a free exchange of ideas or legal theories. An ACO or CPO should view USARCS, based on its broader experience and knowledge of precedent, as a valuable information resource. Nevertheless, ACO and CPO personnel should freely express their opinions about the law, damages, or payment of a claim to the AAO.

b. Claims processing offices. CPOs are those posts, depots, or other organizations, including DOD depots and activities, that employ CJAs or claims attorneys. CPOs always maintain investigative responsibility for claims incidents arising out of their activities. A CPO may be assigned an area of investigative responsibility upon coordination between the ACO and the appropriate commander. A CPO has claims approval authority upon delegation by an ACO of such authority to a CJA or claims attorney. ACOs are encouraged to designate depots or small posts, including DOD activities, as CPOs, particularly if the area assigned to an ACO includes a large area of more than one state. ACOs should designate all CPOs in their geographic area of responsibility and notify each CPO's commander of such designation. Those so designated should be assigned an office code as set forth in AR 27-20, paragraph 13-1b .

c. Unit claims officers. Commanders or heads of DOD and Army components are required to appoint a unit claims officer to conduct an initial factual investigation. Organizations, including on-post units that generate a significant claims load, should appoint a unit claims officer on standing orders with instructions to coordinate investigations with the appropriate ACO or CPO when an incident's potential value is over $50,000. ACOs should develop a serious incident reporting system to ensure that unit claims officers immediately notify the ACO or CPO of a claims incident. Unit claims officers may report on DA Form 1208 , Report of Claims Officer, or for a motor vehicle accident on SF 91 , Motor Vehicle Accident Report. To obtain blank copies of both forms see the heading for section III of appendix A for Web sites where blank copies may be downloaded.

d. Special claims processing offices. AR 27-20, paragraph 1-12 , explains the necessity for, and sets forth the role of, the special claims processing office. When a claims incident occurs that will generate a large number of claims requiring immediate investigation, an ACO should consider establishing such an office. If the ACO does not have sufficient personnel to accomplish the mission, it should seek assistance from the appropriate major command (MACOM) in coordination with the USARCS AAO.

e. Medical claims processing offices. Medical claims incidents should always be investigated by a CJA or claims attorney assigned to an ACO or CPO, with any technical assistance necessary provided by a USARCS AAO, by virtue of two agreements between the Judge Advocate General (TJAG) and the Surgeon General (posted on the USARCS Web site at "Claims Resources," I, f, nos. 1 and 2). The ACOs whose area contains an Army medical center are assigned a medical claims judge advocate (MCJA) or medical claims attorney to operate a medical CPO. In the Federal Republic of Germany (FRG), responsibility for processing all medical malpractice claims arising in any MTF has been delegated to the MCJA or medical claims attorney, Landstuhl Regional Medical Center and the staff judge advocate (SJA), European Regional Medical Command. A CJA or claims attorney should conduct the investigation of all medical claims at Army MTFs that are not AMCs. Routine contact should be maintained with the MTF risk manager, who is required to screen PCEs and review DA Forms 4106 (Quality Assurance/Risk Management Documents) and maintain contact with the MTF staff. See AR 40-68 for a detailed description of these procedures. The MCJA, CJA, or claims attorney should conduct an investigation independent of any MTF investigation, such as those conducted by quality assurance (QA) or risk management (RM) committees or pursuant to AR 15-6 . The MCJA, CJA or claims attorney should advise the QA or RM committee and participate in its procedures to the extent required. However, if a QA or other investigation results in a credentialing review process, the center judge advocate (JA) or SJA, not the MCJA or CJA, should provide legal advice to the credentialing committee.

Section II
Filing and Receipt of Claims

2-4. Procedures for accepting claims

a. Initial contact with claimant. Treat all persons who request claim forms or information about filing a claim as potential claimants. Each claims office should maintain a system for handling these inquiries. Standing operating procedures (SOPs) should ensure that potential claimants are able to speak quickly with an attorney, investigator, or examiner. Unit claims officers and other investigators should interview an injured party or contact the injured party's attorney, if represented, and request an interview. Before such meetings, the ACO or CPO should instruct unit claims officers on proper claims filing procedures, including entering the appropriate ACO or CPO's address.

(1) Use the initial discussion with the potential claimant to establish a good relationship and to learn as much as possible about the claim. Be courteous and interested. If the potential claimant comes to the claims office, try to conduct an interview immediately. Arrange for follow-up interviews and close contact. If the request is made by telephone, screen the caller carefully and obtain details on the incident. Try to arrange to have the person visit the claims office to obtain forms or information, and be ready to conduct a follow-up interview. If the request is in writing, respond with a telephone call. Obtain the writer's telephone number and discuss the request directly. The goal is to have the claimant visit the office or to otherwise establish close contact with the claimant.

(2) People often visit the claims office to ask about filing forms. Interview them immediately to extract as much information as possible about the claim, especially the damages sustained. Developing a good relationship with the claimant at the outset facilitates both further investigation and ultimate settlement. Before conducting the interview, always ask if the potential claimant is represented by an attorney.

(3) Treat each inquiry as a serious potential claim until it proves otherwise. Open a potential claim file and prepare a memorandum for record of any statements the inquirer makes. If a claimant calls about a traffic accident and asks about filing a claim for damage to an automobile, assume that there may be personal injuries or other property damage. Begin the investigation as soon as you hear of the incident. If the claimant's inquiry is the first anyone knows of the incident, start the investigation by interviewing the claimant immediately.

(4) Potential claimants should never be advised not to file a claim even where it is obvious that the claim does not fall under AR 27-20 's authority or, if it does, is not payable, for example, because it is incident to service or because of the statute of limitations. If another remedy exists, claimants should be advised of that remedy. Claimants should be furnished SF 95 , advised of the statute of limitations, and told to file with the ACO that has jurisdiction. If the latter cannot be determined the claimant should file with USARCS. Under the FTCA, an administrative claim must be filed prior to filing suit.

(5) Where a claim for property damage is filed and there are known injuries, the claimant shall be informed of the split claims procedure, detailed in paragraph 2-70 , to insure the property damage settlement is proper.

b. The Standard Form 95, Claim for Damage, Injury, or Death. Set forth below are block-by-block instructions on the proper way to complete an SF 95, Claim For Damage, Injury or Death. These instructions should be referenced as claim forms are reviewed. They will serve as a guide to identifying deficiencies in the form. A sample completed SF 95 is posted on the USARCS Web site at "Claims Resources," I, a, no. 28.

(1) Block 1. Claim forms handed out by your office should be stamped or overprinted with your office address. This helps claimants mail the form to the proper address. If the claimant completes the form and lists more than one address, the claims office should be aware that a transfer or designation of lead agency may be needed. If the claim is being filed with more than one federal agency or non-government defendants, the claimant should be requested to furnish the identifying information on all addresses.

(2) Block 2. The claimant's name is the first indication of the type of claim being presented. While a claimant cannot be required to furnish their social security number (SSN) in order to file a claim in medical malpractice cases, the patient's or spouse's SSN is needed to locate the medical records.

(a) Each claimant should submit a separate claim form. For example, if spouses are filing for personal injury and loss of consortium, each files a form. If both claims are presented on the same form, send new claim forms to the claimant, but separately log all the claims properly presented on the one form.

(b) If a person is filing a claim on behalf of another person, the names and addresses of both should be listed. The claim is not filed in the name of the agent, and the legal title of the representative must be listed. For example, if the person presenting the claim has a power of attorney to file a claim, the words "agent for" followed by the claimant's name should follow the name of the agent.

(c) Proof of representative capacity must accompany the claim form. For an agent, it is the power of attorney or other document indicating representative capacity. For an executor or administrator of an estate, it is a copy of the court appointment. For a person filing on behalf of a corporation, it is proof that the person signing the claim is authorized to file a claim on behalf of the corporation. Local forms should be devised for this purpose. Note that the same person cannot sign both the claim form and the letter designating that person as a representative of the corporation. A sample format is posted on the USARCS Web site at "Claims Resources," II, a, no. 12.

(d) Attorneys hired by a claimant do not have representative capacity by virtue of their agreement to represent the claimant. An attorney must present a power of attorney or other document that contains specific authorization to file a claim form on behalf of the claimant. A retainer or employment agreement is not sufficient for this purpose unless it contains language specifically empowering the attorney to present the claim.

(e) Ask the claimant's representative in writing to provide a copy of the basis for representative capacity. If the statute of limitations has not expired, inform the representative that the statute of limitations has not been tolled by receipt of the claim form. If the representative produces a document that was effective as of the date the Army received the claim, the claim is properly filed. If the document was prepared in response to the request for proof of representative capacity, the claim is probably defectively filed (because the representative was not appointed at the time the claim was filed), and the representative should be asked to fill out a new claim form. An exception to this is the corporate representative. Research state law to determine whether the corporate representative was authorized to file the claim.

(f) In some cases, the representative may have a separate claim from that of the claimant being represented. For example, a wife might have a power of attorney to present a claim on behalf of her husband for personal injury to both. The representative should prepare two claim forms.

(3) Blocks 3 through 5. This information must relate to the claimant, not the representative. In a death case, information should relate to the deceased.

(4) Blocks 6 and 7. For most claims, this will be the date of the accident or incident causing injury. If the discovery rule applies in a medical malpractice claim, the dates the alleged malpractice occurred should be listed. An in-depth interview with the claimant on this point will be necessary and should be conducted immediately.

(5) Block 8. Facts alone are not enough. The claimant must be encouraged to explain why the claimant believes he or she has a claim against the United States. The goal is to determine if the claimant or the claimant's attorney has investigated the claim.

(a) Some attorneys and claimants try to evade this requirement by inserting the words "see attached accident report" or similar language. Even if the accident report seems to provide a basis for liability, it is only one version of the facts and not necessarily the claimant's version.

(b) A similar tactic is followed in medical malpractice cases. Attorneys will often simply refer to medical records without commenting further, or they will just list a series of events without indicating why they believe the care was substandard. Attorneys who use this practice are often trying to get an investigation and settlement without investigating on their own to support the claim. In medical malpractice cases, it is crucial that claimants specify what care they believe was improper and what injury resulted from it.

(c) When a claim form is presented without the required explanations, the claim form should be acknowledged and considered properly filed. However, the claimant should be informed in writing that the filing is insufficient and that further information is needed to support the claim. Further, in a medical malpractice case the claimant should be asked for the identity of any physician who told the claimant the care was substandard. The claim will still be investigated. The claimant's attorney should be advised of the need for an expert opinion except in a case of obvious liability.

(6) Blocks 9 and 10. These blocks should contain specific information. Inform the claimant that the property damage or injuries must be described in detail or compensation cannot be paid. Do not allow the claimant to include damage estimates or medical bills by reference without an explanation.

(7) Block 11. The usual problem here is the tendency of the claimant to list only names on an accident report or in the medical records. Be sure full names and addresses are listed. SF 95 does not require the claimant to list telephone numbers for witnesses, but this information should also be requested. In addition, ask the claimant to list the names and addresses of other persons who are not in the reports but who know about the incident.

(8) Block 12. A sum certain must be listed, broken down by property damage, personal injury, and wrongful death. The amounts must be totaled.

(a) The term "sum certain" means the amount of money the claimant seeks as compensation for the loss; an actual dollar figure must be listed on the claim form. Words such as "uncertain" or "to be determined" do not satisfy this requirement.

(b) If a claimant is unable to break down the amount of the claim in blocks 2a through c, simply ask the claimant to list a total figure in block 12d. Inform the claimant, however, that the amounts must be broken down before the claim can be paid.

(9) Block 13a. Compare the claimant's signature with the name in block 2 and other documents in the file. It should be signed as it appears in block 2, and it should be the claimant's signature. Inquire about any discrepancies you find. Attorneys often sign their names to a client's claim. Be alert to the practice.

(10) Block 14. The claimant must fill this out. But remember that the true (or legal) date of the claim is the date the Army receives the form. See paragraph 2-9 . The acknowledgment letter spells this out.

(11) Blocks 15 through 19. Insurance data are mandatory. Many people refuse to list insurers for fear that the Army will contact their company and their insurance premiums will rise. The information must be filled out whether or not the claimant has filed an insurance claim.

c. Additional points to consider when reviewing a claim.

(1) A claimant need not fill out a claim form to file a claim. A claimant may file a claim by delivering to any Army activity a writing that seeks a sum certain (see para 2-5 ), signed by the claimant or an authorized representative, and containing enough information to allow the Army to begin investigating the incident that gave rise to the claim. Thus, treat any writing that meets this requirement as a claim. It should be logged and entered into the claims database. However, every claimant should fill out and file a claim form, even if the jurisdictional requirements are met by letter. An SF 95 contains information needed to process the claim. When a claim is filed jointly, a sum certain must be furnished for each claimant. Frequently, when one spouse is injured, both spouses' names appear on the claim. One spouse claims for personal injury and the uninjured spouse claims for loss of consortium, but they furnish only one sum. Similarly, when a minor child is injured, the parents' names, both individually and as natural guardians, appear, but they furnish only one sum. Such claims are defective because each claimant, that is each person claiming, must name a sum certain. Where the claimant refuses to state a sum certain for each claimant, log the joint claim as two claims and use the same sum certain as the amount. This rule applies equally to class action claims. All claimants involved in a class action should file separate SF 95s. Remember, for Financial Management Service (FMS) to pay a claim, each claim sent thereto must exceed $2,500. A joint payment cannot meet this requirement. Joint claims should be avoided from the outset.

(2) Issues relating to whether the claim was properly filed may be raised long after the claim is filed. Therefore, claims personnel must identify all written materials accompanying the claim in some way that allows others to know what documents were originally filed (such as on a specially marked list). These accompanying written materials may correct defects in the claim form.

(3) A claim form may be returned to the claimant only when the information it contains is insufficient to determine which federal agency is responsible for processing the claim. Even in that case, however, retain a copy of the claim form in a potential claim file along with an explanation of the circumstances. In all other situations, retain the claim form and inform the claimant that the claim has not been validly filed and the reason why it is defective. If a claim form requires correction, either ask the claimant to fill out a new one or have the claimant correct, initial, and date it in person.

2-5. Identification of a proper claim

A claim is defined as a written document signed by the person suffering a loss or injury or that person's legal representative, which states a sum certain and identifies the PCE sufficiently to permit investigation thereof. See the Federal Tort Claims Handbook (FTCH) § 1, B, generally. When a claimant is represented by an attorney the claim should include a separate letter or memorandum, signed by the claimant, expressly authorizing the legal representative or agent to file on behalf of the claimant. Failure to include this document may be remedied at a later date and does not mean that the claim is improperly filed. A claim may be transmitted by letter or fax if it meets these requirements. A foreign claim arising under AR 27-20, chapter 10 , may be presented orally provided that it is reduced to writing not later than three years from the date of accrual. A claim for property loss is limited to the loss of, or damage to, actual tangible property. Consequential damages are not compensable. Claims must be filed with the federal agency whose acts or omissions gave rise to the claim. Section III , Processing of Claims, below sets forth procedures for transferring a claim filed with the wrong federal agency. A claim must be filed not later than two years from the date of accrual or the date on which the injured person discovered the injury and the cause thereof. Infants and incompetents are held to the same two-year filing period. There is no requirement that the injured person know that the injury or damage resulted from a negligent or wrongful act or omission (FTCH § I, D). The claimant must submit certain supporting documents as required by 28 C.F.R. § 14.4 , the Attorney General's Regulations implementing the FTCA, and as outlined on the reverse side of the SF 95 . Non-receipt of such documents at the time of filing is not a basis for holding that the claim was not timely filed. However, a claimant's refusal to provide supporting documents may lead to dismissal of a subsequent suit based on failure to adhere to the Federal Tort Claims Act's (FTCA) implementing regulations, McNeil v. United States, 508 U.S. 106 (1993). Under the FTCA, a claimant has an absolute right to sue six months from the date of filing a proper claim with a federal agency. Therefore, it is necessary to obtain sufficient documentation as soon as possible to adjudicate the claim. Under other statutes, such as the Military Claims Act (MCA), claims may be denied for failure to provide documentation. See AR 27-20, paragraph 2-38 . In computing the time remaining under the statute of limitations, exclude the first day and include the last day, except when it falls on a non-business day, in which case extend it to the next business day (FTCH § I, D). Where a claim names two claimants and states only one sum certain, courts have consistently held that this is a proper claim. Nevertheless, try to obtain a sum certain for each claimant as this will be required for administrative processing and payment.

2-6. Identification of a proper claimant

a. AR 27-20, paragraph 2-6 , identifies persons who may present a claim.

b. Subrogated claims are permitted only under the FTCA and the Army Maritime Claims Settlement Act (AMCSA). See AR 27-20, chapters 4 and 8 . Such claims are excluded under all other statutes. See AR 27-20, chapters 3 , 5 , 6 , and 10 .

(1) The claims of the subrogor (insured) and subrogee (insurer) for damages arising out of the same incident constitute separate claims. Except under the FTCA, the aggregate of such claims may exceed the monetary jurisdiction of the approval or settlement authority as long as each individual claim seeks an amount less than that monetary jurisdiction.

(2) A subrogor and a subrogee may file a claim jointly or individually. A fully subrogated claim will be paid only to the subrogee. Whether a claim is fully subrogated is a matter to be determined by state law. Some jurisdictions permit property owners to file for property damage even though their insurer has compensated them for repairs. In such instances, obtain releases from both parties in interest, either jointly or severally. The approved payment in a joint claim will be made by joint check, issued to the subrogee unless both parties specify otherwise. If separate claims are filed, payment will be by check issued to each claimant to the extent of his or her undisputed interest. See section IX , Settlement Procedures, below.

(3) When a claimant has made an election and accepted workers' compensation benefits, research the jurisdiction's statutory and case law to determine to what extent acceptance of such benefits extinguishes the injured party's claim against third parties. In those cases in which election fully extinguishes the claim, the workers' compensation insurance carrier is the only proper party claimant. Even when the injured party's claim has not been fully extinguished, most jurisdictions hold that the workers' compensation insurance carrier has a lien on any recovery from the third party and no settlement should be reached without approval by the carrier. However, claims from the workers' compensation insurance carrier as subrogee or otherwise will not be considered payable if the United States has paid the premiums, directly or indirectly, for such workers' compensation insurance. Also, the appropriate contract provisions from the workers' compensation contract that hold the United States harmless should be referred to in the settlement agreement. See section X , Payment Procedures.

(4) Whether medical payments paid by an insurer to its insured may be subrogated depends on local law. Some jurisdictions prohibit insurers from submitting these claims, notwithstanding a contractual provision providing for subrogation. Therefore, research local law before deciding the issue, and include the results of this research when forwarding claims for adjudication. See Section VI , Determination of Damages. Such claims, where prohibited by state law, are also barred by the Anti-Assignment Act, 31 U.S.C. § 3727. See AR 27-20, paragraph 2-6f .

(5) Exercise care to require insurance disclosure consistent with the type of incident generating the claim. Every claimant will disclose in writing, as part of the claim:

(a) The name and address of every insurer.

(b) The type and amount of insurance coverage.

(c) The policy number.

(d) Whether a claim has been or will be presented to an insurer and if so, the amount of the claim.

(e) Whether the insurer has paid the claim in whole or in part or has indicated that it intends to do so.

(6) If a delay between the filing and settlement dates occurs, update insurance information to avoid double payment. All subrogees must substantiate their interest or right to file a claim by appropriate documentary evidence. They should support the claim as to liability and measure of damages in the same manner required of any other claimant. Documentary evidence of payment to a subrogor does not constitute evidence either of governmental liability or amount of damages. Approval and settlement authorities will make independent determinations on these matters, based upon the evidence of record and the law.

c. Joint or successor tortfeasors frequently present claims for contribution or indemnity before making payment to the injured party. While such claims do not accrue until payment is made, consider a joint settlement where there is an outstanding claim against the United States and proportionate liability exists. See section VIII , Negotiations.

d. A claim presented by other than an injured person or subrogee is excluded by the Anti-Assignment Act (31 U.S.C. §3727), subject to certain exceptions.

(1) The Anti-Assignment Act bars every purported transfer or assignment of a claim against the United States or any part of or interest in a claim, whether absolute or conditional. It also bars transfer or assignment of every power of attorney or other purported authority to receive payment of all or part of any such claim.

(2) The Anti-Assignment Act was intended 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 the voluntary assignment of claims. It does not apply to 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 liquidation, consolidations or reorganizations, and where title passes by operation of law to heirs or legatees. For example, subrogated workers' compensation claims, when presented by the insurer, are cognizable.

(4) Subrogated claims arising pursuant to contractual provisions may be paid to the subrogee if recognized by state statutory or case law. For example, an insurer under an automobile insurance policy becomes subrogated to the rights of a claimant upon payment of a property damage claim. Generally, such subrogated claims are authorized by state law and are therefore not barred by the Anti-Assignment Act. In addition, payments of subrogated claims may be made pursuant only to the FTCA and the federal admiralty statutes.

e. Before paying claims, it is necessary to determine whether a valid subrogated claim under federal or state statute or a subrogation contract held valid by state law exists. If there is a valid subrogated claim forthcoming, withhold payment for this portion of the claim. If it is determined that the claimant is the only proper party, full settlement is authorized.

2-7. Claims acknowledgment

The claimant is responsible for properly filing a claim. A claimant is entitled to assistance in filing claims, including crucial information about the statute of limitations. A claim must be filed within two years of the date the claim accrues; if not filed within that time, the claim is not properly filed.

a. Acknowledging defective claims.

(1) The best way to acknowledge a claim is to telephone or e-mail the claimant or attorney and then send a letter confirming the conversation. The administrative claims procedure is intended to allow investigation and settlement of claims before they result in litigation or appeal. This is best done by establishing and maintaining close contact with the claimant or claimant's attorney.

(2) Sometimes a claim is defectively filed near the expiration of the statute of limitations. In such cases, acknowledge the claim by telephoning or e-mailing the claimant or attorney and describing the defect. Place in the claim file a memorandum of all attempts to contact the claimant and of discussions held with the claimant. Mail a letter confirming the conversation to the claimant or attorney or place a copy of the e-mail in the file. If time is of the essence, instruct the claimant or attorney to file the corrected claim with the nearest Army office (such as a recruiting or Reserve Officers' Training Corps (ROTC) office) or send it by facsimile (fax) or other expedited means.

b. Initial review of incoming claims. Claims should be reviewed with a view to insuring compliance with state law requirements, particularly where court approval might be required prior to payment. Review each SF 95 block by block in accordance with the instructions set forth in paragraph 2-4b . Wrongful death claims may be filed by a personal representative where state law consolidates both claims by the estate and survivors' claims and only one claim is permitted. This is the rule for MCA claims (AR 27-20, para 3-5c(1)(a) ) as well as in certain states. In FTCA cases claimants should be advised in writing to follow the law of the state where the act or omission that caused the death occurred. Similarly, this is the rule where each survivor listed in the state wrongful death act files individually in addition to the claim of the estate. Where the attorney in question does not represent all survivors, for example, the separated spouse in a minor's death case, all survivors must agree to the settlement. Where state law does not permit parent-child loss of consortium claims in a personal injury claim, such a claim must be withdrawn or denied prior to settlement. Accordingly, the claimants should be informed initially upon filing that such a claim is not payable.

c. Acknowledgment by letter. Five sample acknowledgement letters are posted on the USARCS Web site at "Claims Resources," II, c, nos. 1 through 5. They are identified respectively as follows: acknowledgment letters (for), FTCA, MCA, Defective Claim, Amended Claim, and Request for Reconsideration. A properly written acknowledgment establishes the date of filing, notifies the claimant of the administrative requirements to process the claim, and explains any deficiencies in the claim. Acknowledgment letters are not required under small claims procedures provided the receipt is otherwise acknowledged. Adhere to the following instructions when sending acknowledgment letters:

(1) Certified mail. Acknowledgment of a defectively filed claim should be sent by certified mail, return receipt requested.

(2) Date stamp. Date stamp a copy of the claim to reflect the date the Army received the claim. Attach a date-stamped copy to the letter to the claimant to show that the claim has been received and processed.

(3) Medical records. Whenever the processing of the claim either for or against the United States requires the use of either governmental or civilian medical records, provide a completed "Release for Use of Medical Records," and "Explanation of Privacy Rights Under the Health Insurance Portability and Accountability Act (HIPAA)." Samples of both are posted at USARCS Web site at "Claims Resources," II, c, nos. 13 and 14. (HIPAA was made effective April 14, 2003 and implemented by Department of Defense Directive (DODD) 6025.18-R .) Furnish the forms along with a self-addressed envelope as part of the claims acknowledgment. Request that the claimant execute the forms and return them. Under HIPAA, a claims office cannot obtain, use, or disclose protected health information obtained after April 14, 2003 without the consent of the person to whom the medical information applies. If during the course of your investigation you learn of other health care records for which a release has not been obtained, provide the claimant with another medical release under HIPAA for signature. In this situation make sure the release for medical records specifically names the facility from which medical records will be procured. The failure of the claimant to provide a medical release could result in denial of the claim based on the DA's inability to investigate or determine liability absent the right to use the medical information as set forth in the medical release. Any suit filed subsequent to the denial or expiration of six months may be contested on the basis that no administrative claim has been filed, which is a jurisdictional prerequisite to filing suit.

d. Acknowledging properly filed claims. Take the following steps in preparing the acknowledgment letter:

(1) Analyze SF 95 , block by block, to ensure the claim is properly filed. A claim may be properly filed even though SF 95 is improperly completed. As long as the claim meets the criteria for a properly filed claim in paragraph 2-5 above, the statute of limitations is tolled. However, address any defects in the acknowledgement letter. For example, omission of the claimant's date of birth does not affect filing. However, the date of birth is necessary to evaluate a personal injury or wrongful death claim. When the claimant has failed to provide certain information on a properly filed claim form, advise the claimant why the missing information is needed.

(2) After studying the materials submitted by the claimant or claimant's attorney, send an acknowledgment letter requesting the specific materials you need to evaluate the claim.

e. Acknowledging improperly filed claims. If the claim does not meet the jurisdictional requirements for a properly filed claim in para 2-5 above, treat it as a potential claim. The acknowledgment letter should clearly state the defects (see subpara c above). The letter will also contain the substance of any discussions held with the claimant or claimant's attorney concerning defective filing of the claim.

(1) It is inappropriate to fail to acknowledge a defectively filed claim in the hope that the statute of limitations will run and bar the claim. Whether or not the claimant is represented by an attorney, acknowledge the claim. Claims personnel will not assume that an attorney is responsible for discovering any defect in a claim filed by the attorney on a client's behalf. A claimant or claimant's representative is entitled to an acknowledgment that specifies all errors in the claim and explains the effect of any filing errors.

(2) In the acknowledgment letter, inform the claimant of the statute of limitations and advise that the claim, as filed, does not toll the statute of limitations. Language covering this point is contained in the sample acknowledgement letter posted on the USARCS Web site (see subpara c , above). Enclose an SF 95 for each claimant and a self-addressed envelope with the acknowledgment letter. When the claim is defectively filed and the statute of limitations is about to run, promptly notify the claimant of the defect before the statute of limitations runs. Telephone notice is appropriate in such cases.

f. Action on claims determined to be defectively filed after acknowledgment. The requirement to inform claimants of defects continues as long as the claim file is active. When a defect is discovered after acknowledgment, inform the claimant at once of the defect and its nature.

g. Requests for medical records. Army claims representatives are entitled to a copy of all Army medical records from an Army medical treatment facility, AR 40-68, chapter 12 . If the claimant has been treated by other than U.S. Army medical treatment facilities or health care providers, the acknowledgment letter should request that a copy of all such records be furnished or the claimant should be provided a release for his signature authorizing the AAO or CPO to obtain the records. The release should specifically state the dates and places of treatment and the identity of the health care provider where known. Such a release is requested to obtain records from other government treatment facilities including those of the Departments of Veterans Affairs, Navy, Air Force, Public Health Service and Coast Guard.

h. Health Insurance Portability and Accountability Act. The HIPAA precludes the use of medical information by other government agencies, civilian entities, expert or consultants without the consent of the patient. Enclose a copy of a release and authorization (see subpara c(3) above) to permit such use with the acknowledgement letter for any claim including personal injuries or wrongful death. This will permit an ACO or CPO to seek medical review of the injuries by personnel at the local MTF, by an independent medical expert, or from a variety of other sources, for example, vocational rehabilitation services, brokers, insurance companies or economists. The acknowledgement letter (see subpara c above) should contain a paragraph stating that failure to sign the authorization could result in the denial of the claim, emphasizing that the claimant has the duty to document the claim and failure to do so renders the claim a nullity. Further, any ensuing suit under the FTCA could be barred by failure to file an administrative claim, a jurisdictional prerequisite to an FTCA suit. Under other chapters a denial is authorized for failure to document, AR 27-20, paragraph 2-38 .

2-8. Revision of filed claims

See also AR 27-20, paragraph 2-8 .

a. New claims.

(1) The acknowledgment letter should inform the claimant that the claim is a new claim. If the new claim is considered under the FTCA, inform the claimant that the six month period during which suit may not be filed starts as of the date of receipt. If the new claim is clearly received after the two year statute of limitations has expired, the claimant should be so informed in the acknowledgment letter and asked to withdraw the claim. If it is not withdrawn, deny it. If the accrual date of the statute of limitations is in doubt and must be investigated, so inform the claimant but do not deny the claim.

(2) If the original claim has been denied, a new claim as defined in AR 27-20, paragraph 2-8, may be accepted and considered provided it is filed not later than two years from the date of accrual. A claim withdrawn from suit constitutes a new claim and must be filed not later than two years from the date of accrual or the sixty day period for filing set forth in 28 U.S.C. §2679.

(3) A party may be added only if the additional party could have filed a companion claim initially. If the party has a separate cause of action, the claim is a new claim, not an amendment and must be filed not later than two years from the date of accrual. Examples are loss of consortium or services in marital or parent-child relationships.

b. Amendments.

(1) A claim may not be amended after denial has been taken or a final offer has been made by a settlement authority who has been delegated denial authority under AR 27-20 .

(2) Where the insured has filed a property damage claim and has been paid by the insurer, the insurer may file an amendment to the insured's claim as the real party in interest even though the amendment is received after the expiration of the statute of limitations provided that the insured's claim for property damage has not been denied or a final offer made.

Section III
Processing of Claims

2-9. Actions upon receipt of a claim

a. The ACO or CPO will date stamp all copies of a claim, including the SF 95 , on the date it receives a claim. For dating purposes, the claim, if jurisdictionally defective, will be considered a PCE and any written demand on an SF 95 will be considered a claim. Neither the absence of a claimant's signature or a sum certain nor an improper signature precludes dating. However, the claimant must be informed immediately of any deficiencies as set forth in paragraph 2-7 above. If the two-year statute of limitations is at issue, the stamped date should reflect the date the post mailroom receives the claim. Maintain a system by which the claims office is made aware of such date by the post mail handlers; for example, the post mailroom might date-stamp the incoming envelope. The ACO or CPO employee who date-stamps the claim will supply either initials or signature for identification.

b. If a unit or organization that has no Army claims office receives a claim, it should nevertheless date-stamp the claim in the manner prescribed above. Upon receipt of a claim without a date stamp, the ACO or CPO should ascertain the date of its receipt and record this information on the chronology sheet placed in the claims file. Receipt of an Army claim by the U.S. Air Force, Navy, or any DOD organization tolls the statute of limitations. Receipt by another federal agency does not. Receipt of a tort claim against the Army by a state does not toll the statute of limitations, unless it is received by a full-time officer or employee of the Army National Guard (ARNG).

c. As soon as possible after receiving the claim, an ACO or CPO will enter it into the database using the next available claim number in the series assigned to that particular office, as required by paragraph 13-1 . Enter the claim number on the claim itself and in the claim file. Thereafter it should appear on all correspondence and documents.

d. If the claim is based on an incident occurring in another ACO's geographic area, close the file and transfer it to that ACO, which will continue to use the same assigned claim number when entering the claim into the database. The following examples illustrate proper procedure:

(1) A unit from Fort Stewart debarks at San Diego and proceeds by military convoy to Fort Irwin. A collision between a military vehicle and a civilian vehicle occurs in Fort Irwin's area of responsibility. The civilian vehicle is driven by a resident of northern California whose San Francisco attorney files a claim for personal injury, in the amount of $1 million, at the Presidio of Monterey. The Presidio should date stamp the claim, assign a claim number, transfer it to Fort Irwin for processing, and submit a copy to USARCS. Fort Stewart should assist Fort Irwin in the investigation.

(2) A Louisville, Kentucky, Reserve unit's vehicle crashes into an office building in eastern Tennessee while en route to Fort Bragg for two-week annual training. A claim is filed with the Reserve unit for damage to the building, but the unit does not respond. A Congressional inquiry to the Pentagon is referred to Fort Knox, Kentucky. That office should contact the claimant and direct the claimant to the correct ACO, which is Fort Campbell.

e. When other uniformed services' claims offices are involved, the same general guidelines should apply. However, a claim under AR 27-20, chapter 11 , is payable by the Army only when filed by a Soldier or by a DOD civilian employee. If a claim by a member of another uniformed service is payable under AR 27-20, chapters 3 and 4 , and also under the Personnel Claims Act (PCA), refer the claim to the member's service for a determination whether it is so payable and, if not, request its return for the Army's consideration. See AR 27-20, paragraph 1-20 , on cross servicing of claims. Finally, mutual assistance between uniformed services' claims offices in the investigation and processing of claims is a long-standing policy that Army personnel should follow.

f. Transfer all companion claims simultaneously. Transfer those filed later to the same office upon receipt. If the transferring office will play a role in processing, investigating, or settling the claims, duplicate as much of the file as necessary and retain it until all claims are closed.

g. When USARCS receives a new claim from a field office it will use the claim number given to it by that office. If USARCS receives a claim which has not yet been assigned a number and decides to keep responsibility for it (for example, a claim on which it may take final action without investigation), it will assign the claim one of its own office numbers.

h. Tables listing claims offices worldwide are posted to the USARCS Web site at "Claims Resources," VI.

2-10. Opening claims files

a. Open a potential claim file when an incident occurs that could result in a claim either in favor of, or against, the United States. This decision may be based on:

(1) Receipt of information concerning an incident which results in the initiation of a claims investigation as required by AR 27-20, paragraphs 2-1 and 2-2 .

(2) Receipt of a request for records or other documentation by, or on behalf of, a potential claimant, indicating a potential claim either in favor of, or against, the United States.

b. Create and mark all such files as potential claims. Arrange them alphabetically by the name of the injured party.

c. Upon concluding the investigation and determining the facts and circumstances surrounding the incident, maintain the file as "active" until a claim is received, or for six months after the statutory period for filing a claim has expired.

d. Actual presentation of a claim in writing will require the opening of a claim file or the conversion of a potential claim file to an active one.

2-11. Arrangement of file

Maintain all tort claim files in standard order as prescribed in this paragraph. Following a standard format permits personnel to review the contents and prevents oversights or mistakes caused by overlooking a document in the file or failing to recognize that a document is missing. Forward all files transferred to USARCS in this format, unless USARCS has previously received all documents as a result of compliance with the mirror file system.

a. File standards. The following rules apply to all tort claim files:

(1) When possible, use a six-sided folder (available through supply channels) to contain the file contents. The following parts of the claim file correspond to the sides of such a folder. ( A six-sided folder is not required for files less than one-half inch thick.)

(2) Subdivide parts into sections and sections into subsections. A table of contents is recommended for all files and should be prepared for any part that has multiple sections. Designate parts by Roman numerals, and sections by letters. Tab each section or separate with dividers. Designate subsections by Arabic numerals.

(3) When the number of claims arising out of a single incident makes it impractical to place all the documents in one folder, establish separate files containing the information unique to each claimant. For example, if an explosion breaks windows in fifty houses, establish a separate file for each claimant, maintaining the liability information in a master file. Keep all basic information about each claim (such as a copy of the claim form) as well as information pertaining to the claims generally in the six-sided folder and establish a separate file folder (manila) for each individual claimant.

(4) When a claim is settled but there is the potential for additional claims stemming from the same incident, retain the file as a potential claim file. Retain it until all claims are settled or the statute of limitations has run on all potential claims.

b. Part I, Chronology. Use this section only for the case chronology sheet, which is a mandatory part of each tort claim file.

(1) Format. Use plain or ruled paper or locally prepared forms for chronology sheets. Enter the date in the left-hand margin, followed by the information to be recorded, followed by the initials of the person making the entry.

(2) Contents of entry. Ordinarily, only administrative data and a summary of actions taken will be placed in the entry. Record interviews, inspections, and similar events in the memoranda for record (MFRs) placed in part IV, V, or VI. A chronology sheet entry is intended as a guide for those reviewing a file and a management tool for case status, not a memory aid. Personnel may place telephone numbers and addresses in a chronology sheet entry but should place notes from a claimant interview in an MFR kept in part V.

c. Part II, Claim form and allied papers. This part of the file contains matters pertaining to the administrative claim form and attachments. If a document pertains to one or more parts, it should appear in the part of the file most relevant to the claim. For example, if a claimant tries to submit hundreds of pages of medical records by reference in the claim form, file the medical records in part VI and place an MFR, specifying which records accompanied the claim, in part II. Place the following documents in separate sections in the order specified:

(1) Claim form (with continuation sheets).

(2) Attachments (other than documents that belong elsewhere in the file).

(3) Agent's authority to file claim, letters testamentary, or letters of administration, power of attorney, or similar documents.

(4) Acknowledgment letter from the claims office to the claimant or attorney.

(5) When there are multiple claims, maintain the documents pertaining to each claim in a separate section, designating the sections above as subsections.

(6) If the claim is settled, place settlement documents (including the settlement agreement, transmittal letter, voucher, and action) in a single section on top of this part.

(7) If the claim is not settled, place final action, final offer, denial notice, reconsideration, or appeal notice in a single section on top of this part.

d. Part III, Correspondence. All correspondence, including memoranda on administrative matters, belongs in this section, unless it contains information that logically belongs in another section. For example, when a claimant tries to file a claim by letter, the letter belongs in part II. Arrange the correspondence or memoranda in chronological order, with the most recent document on top. Attachments to correspondence should not appear in this section unless there is no other logical place to put them.

e. Part IV, Research. This part consists of copies of any relevant case or statutory law as well as legal, medical or scientific research, regardless of source. Use any logical order. Place liability and damages information in separate sections.

f. Part V, Liability. The following sections appear in the order below (from top to bottom):

(1) Claims investigation. Place documentation of any investigation performed by the claims office on top of the other investigations. Investigatory materials include interview memoranda, witness statements, accident scene diagrams, and photographs.

(2) Consultants' reports. Place reports prepared by experts, accident reconstructionists, and other consultants in a separate section following the claims investigation.

(3) Other investigations. Place each investigation other than a claims investigation in a separate section, with the most recent investigation on top. For example, an MP report could be in section D, followed by a report of survey in section E.

g. Part VI, Damages. Separate the damages information by tabs and place it in the file as separate sections. When a claimant has received medical treatment from more than one health care provider (HCP), establish a subsection for each HCP, further subdividing into the provider's reports, records and bills. Tab medical records that are too bulky to fit in a six-sided folder and place them in a separate folder. The following is a sample section for a single claimant treated by one physician:

(1) Claimant interview.

(2) Research provided by the claimant.

(3) Medical reports.

(4) Medical records.

(5) Medical bills.

(6) Property damage estimates, repair bills or appraisals.

h. Multiple claims. When more than one claim is filed pertaining to a particular incident, personnel will maintain one file (the master file) for all related claims. If the claim numbers are not sequential, prepare separate files for each non-sequential file. All files will contain a memorandum identifying all related claims by number and claimant name.

2-12. Mirror file system

The AAO is required to monitor the progress of all claims reportable to USARCS through close telephone contact with the command claims service, ACO or CPO and by maintaining a mirror file of all reportable claims and claim incidents. The mirror file is mandatory. This system expedites disposition of a claim and is critical in determining federal liability within the FTCA' s six-month administrative period and meeting the goal of disposing of all claims expeditiously.

a. Forwarding to area action officer. Contact the AAO for guidance, and forward a complete copy of the file, when a claim seeks an amount beyond the monetary jurisdiction of an ACO; when a serious potential claims incident occurs; or when a claim presents a policy issue or a new precedent or point of law. AR 27-20 sets forth the ACO's monetary jurisdiction according to statute; such jurisdiction is based on the amount claimed, not the estimated settlement amount. For example, under the FTCA, an ACO's monetary jurisdiction is $50,000 per claim and $100,000 per incident. Under the MCA, the jurisdiction is $25,000 per claim without limitation per incident. Similarly, forward copies of all new written materials prepared or received to the AAO. The following is a reliable method for forwarding these updates:

(1) Fax, mail, or e-mail a scanned copy of the SF 95 or claim letter with attachments and a copy of the acknowledgement letter as soon as possible. This is in addition to uploading these documents onto the tort and special claims database. Following this initial transmittal, it is imperative that the original SF 95 or claim letter be sent to USARCS Tort Claims Division. The SF 95 will be returned if suit is filed.

(2) Prepare the mirror file copy, including the claim number, when you prepare or receive documentation. If so desired, and after consultation with the AAO, additional documents may be transmitted to USARCS by uploading onto the database.

(3) If additional documentation is only being provided to USARCS in hard copy form, put all mirror file copies in a distribution box for the AAO. Note the claim number on each document.

(4) Empty the box once a week: mail the contents to the AAO.

(5) Record all of the items forwarded for inclusion in the mirror file in Part I, Chronology, of each file.

b. Flexibility of the system. If a claim is forwarded for denial and the field claims office anticipates litigation or appeal, it can keep the original file and forward the original claim form, if not already forwarded, the claims memorandum of opinion, and any documents not previously forwarded to USARCS. This simplifies preparation of a report when suit or appeal is filed. The system also ensures that the USARCS AAO knows the status of the claim and can assist as needed because the field and USARCS have identical files.

c. Special instructions. When placing each document (a copy of which has been forwarded to USARCS) in a tort claim file, enter a note that a copy has been forwarded as required. Do the same with documents forwarded to the claimant or the claimant's attorney, to Health Services Command, or another destination. Such a notation will clearly indicate to all subsequent action officers, including the U.S. Attorney, what information has been released previously to the claimant, the claimant's attorney, or other parties. The file will be retired by the office that takes final action on the claim. However, since files may not be retired without an original claim form, ensure that the retiring office (either USARCS or a field office) is in possession of an "original" of the claim form before retirement occurs that is, before retirement, an "original" of the claim form may need to be transmitted between the field office and/or USARCS to ensure that the retiring office has an original of the claim form, as a result of the mirror file system. In some cases claim forms are provided in original duplicate and each office may already have an "original" in their file. In these cases, no transfer is necessary. Upon notice of litigation, the mirror file will be returned to the office responsible for monitoring the litigation. See AR 27-20, paragraph 13-4 for further discussion of file retirement procedures.

2-13. Transfer of claims among armed services branches

Transferring of claims among armed service branches may occur in several circumstances. First, it may occur when a claim is subject to "single-service responsibility," either because of where it arose geographically or because of its nature. Second, a claim may be transferred among armed service branches by voluntary agreement of the services. This happens either because the claim involves more than one branch and a lead agency is established, or for other reasons, for example, that it may be more convenient for a certain agency to process a specific claim. Third, sometimes claims are transferred among service branches because the claim was clearly filed with the wrong agency. When transferring a claim among armed services branches, keep the following factors in mind. In addition, See AR 27-20, paragraphs 1-19 , 1-20 , and 13-2 , and this publication at paragraph 1-19 for more information. Tables listing claims offices worldwide are posted on the USARCS Web site at "Claims Resources," VI.

a. Upon receiving a claim which has obviously been filed with the wrong federal agency, the ACO or CPO will enter it into the database and transfer it to the correct agency, informing the claimant or legal representative in writing of the recipient agency's name and address and stating that any action the latter takes will represent final action on the part of the Army.

b. Contact the claimant or legal representative when agency identity is in question. If the claim has been filed with other agencies because the claimant is unfamiliar with governmental organizations, try to identify which agency should process the claim. Send it there. However, if the claimant intends to file with multiple agencies, contact the other agencies and try to establish a lead agency in conjunction with the appropriate ACO and the regulatory guidance.

c. Medical malpractice claims frequently involve more than one military service's MTFs. In such cases, delay the decision on the lead agency pending review of the medical records or related material. Question the claimant about which MTF is the subject of the claims.

d. If the agencies cannot agree on which one will act as lead agency, USARCS will request the Chief, Torts Branch, Department of Justice (DOJ), to designate the lead agency.

e. If the Army is the lead agency, the ACO or CPO will request all involved federal agencies to take no final action, such as denial, to forestall the imposition of the six-month period for filing suit. If the Army and another agency are involved and the claim is not meritorious, a denial letter will be issued either for both agencies or by each at the same time to avoid any extension of the six-month period. If another agency has already issued a denial letter for a claim the Army deems meritorious, inform the claimant that the six-month filing period does not apply because the Army will consider the claim as a request for reconsideration. A sample letter to a claimant rescinding the denial is posted on the USARCS Web site at "Claims Resources", II, c, no. 12. When another federal agency is designated the lead agency, transfer the file to that agency, requesting that any final action taken represent the Army's final position as well. Also request the other agency to provide the Army a copy of the final action so the Army may close its file. When transferring the file, notify the claimant of the transfer by certified mail, providing a point of contact at the lead agency.

f. When it is impossible to determine the correct agency's identity, return the claim to the claimant and explain the reasons in a letter. Retain a copy of the properly date-stamped claim and a record of all discussions with the claimant.

2-14. Use of small claims procedures

a. Rationale. Small claims procedures save the Army time and expense. Meritorious claims are settled more efficiently, granting claims personnel more time to work on other, more complex claims. The Army's small claims procedures are consistent with the insurance industry practice of settling minor tort claims on the spot. Using these procedures also avoids escalation of damages since delays in settlement may cause claimants to grow increasingly dissatisfied and to amend their claims, seeking greater compensation. Finally, every claims settlement reflects the judgment and discretion of the CJA or claims attorney who settles it. Small claims procedures are simply a means of reducing the legwork and paperwork necessary to document a claims settlement decision.

b. When to use. Although the use of small claims procedures is optional, they should be used as much as possible whenever a tort claim can be settled for $5,000 or less. They require no written documentation, only completion of DA Form 1668 , Small Claims Certificate. A blank copy of DA Form 1668 may be obtained at www.apd.amry.mil. In addition, a sample completed DA Form 1668 is posted on the USARCS Web site at "Claims Resources," II, a, no. 29. Action may be taken by personal interview, telephone or correspondence. Interviews need not be recorded in a memorandum for record unless a settlement is not reached in that communication. The monetary limit applies to each claim and not to the entire incident. For example, if three claims arise from one incident and settlements in the amount of $3,000, $1,000 and $750 can be reached, use the small claims procedure. But if two claims can be settled for $3000 and $1000 while the third cannot be settled within the ACO's authority, consultation with the AAO is required. Do not use the procedure for split claims. See paragraph 2-80 below. Any small claim settled for $2,500 or less is paid by claims expenditure allowance, over $2,500 by the Financial Management Service. See paragraph 2-26 for how small claims procedures may apply to traffic accidents.

2-15. Determining the correct statute

Congress intended the claims statutes it enacted to permit federal agencies to settle meritorious claims. Unless one particular statute precludes using others, consider an otherwise meritorious claim under all statutes that may possibly apply. For example, if a Soldier's FTCA ( chap 4 ) property loss claim based on negligence is not payable under the FTCA because it arises incident to service, it may be payable under the PCA ( chap 11 ). If not payable under chapter 11, it may be payable under the MCA, chapter 3 . Each claim requires analysis under all statutes before denial.

a. Property claims.

(1) Constitutional taking. In the absence of tortious conduct as defined by the FTCA, claims for property losses caused by a "taking" under the Fifth Amendment, U.S. Constitution, are tried exclusively in the Court of Federal Claims or by a U.S. District Court for a demand not exceeding $10,000. As neither the FTCA nor the MCA provides a basis for payment, refer such claims to USARCS immediately.

(2) Contractual property loses. Property losses caused by a contract, express or implied, are also Court of Federal Claims cases; however, losses arising from the use and occupancy of real estate are compensable under AR 405-15 pursuant to the Meritorious Claims Act, 31 U.S.C. § 3702. See also paragaphs 2-17d(3) , 2-36b , and 2-45b . They also may be compensable under the MCA.

(3) Property losses grounded in tort.

(a) Soldiers' property damage claims are excluded under the FTCA if they occur incident to service as defined by the Feres doctrine. They must be paid under the PCA or, if not payable thereunder, under the MCA. The Feres bar does not apply to the MCA, whose incident-to-service bar does not exclude property losses.

(b) If the property damage occurred incident to service, the claim must be considered first under the PCA, whether or not it arose in tort.

(c) If the property is damaged incident to service, but the facts do not fall within the "incident to service" definition, or do not constitute an unusual occurrence under AR 27-20, chapter 11 , thereby barring the claim, the claim must be considered under the MCA if it constitutes a tort. If it is not clear whether it is a tort, give the claimant an opportunity to clarify the matter by amending the claim.

(d) Payment of Soldiers' chapter 11 property claims should be withheld pending resolution of any personal injury or death claim arising out of the same incident. Coordinate settlement action with the claims authority having jurisdiction over the highest dollar actual or potential personal injury or death claim.

(e) Payment of property and personal injury claims under the MCA should be withheld until coordinated with the claims authority having jurisdiction over the highest dollar actual or potential personal injury claim. Determine the extent of all injuries as to claims not filed. If hardship exists, notify USARCS promptly, to permit an early decision. However, if an incident involves tortious conduct and actual and potential claims with an estimated settlement value in excess of $200,000, claims arising therefrom may not be settled until the Commander USARCS determines whether prior approval by DOJ is needed.

(4) Consequential property damage claims by civilian employees. The FTCA and the MCA limit compensation to actual property loss. Claims for consequential property damage can only be considered in the Court of Federal Claims pursuant to 28 U.S.C. § 1346, the "Tucker Act," and 28 U.S.C. § 1491, or by the Office of Management and Budget (OMB) pursuant to 31 U.S.C. § 3702, Jurisdiction for Certain Property Claims. See paragraph 2-17 , claims remedies outside of AR 27-20. In addition, examples of intangible (or consequential) damages are provided in paragraph 2-54 .

(5) Tangible property damage claims by civilian employees. Within the United States, property damage claims by civilian employees are covered by the FTCA, even if they arise within the scope of employment; the Federal Employees Compensation Act (FECA) or Longshore and Harbor Workers Compensation Act (LSHWCA) exclusivity provision does not apply to property damage. See 5 U.S.C. § 8116(c). However, civilian employee property damage claims are first considered under AR 27-20, chapter 11. If the damage arises from a tort and is not compensable under chapter 11, the claim should be settled under the FTCA.

(6) Impact of venue within which claim arises. If the claim arises outside the United States, claims by both Soldiers and civilian employees follow the same priority rules. They are considered first under the PCA, and then under the MCA if the claimant is a U.S. national. If the claimant is a civilian employee who is not a U.S. national, and who normally resides in a foreign country, the Foreign Claims Act (FCA) should be used in the absence of an applicable Status of Forces Agreement (SOFA).

b. Personal injury and death claims.

(1) Claims by Soldiers and civilian employees.

(a) Under state law, personal injury and death claims arising from an employment contract or relationship are usually payable under workers' compensation insurance, which bars tort suits against the employer even when the personal injury or death is due to the employer's negligence. Federal law applies the same concept.

(b) Claims by Soldiers arising incident to service as defined by the Feres doctrine are barred under both the FTCA and the MCA. See 10 U.S.C. § 2733(b)(3).

(c) Claims by civilian employees arising within the scope of employment are payable under FECA, the workers' compensation statute; see the 5 U.S.C. § 8116(c). Similarly, claims by Non-Appropriated Fund Instumentalities (NAFIs) or the Army and Air Force Exchange Service (AAFES) employees are payable under the LSHWCA, 33 U.S.C. § 8116(c). Both statutes provide the exclusive remedy against the United States. The Department of Labor defines scope of employment according to the law of the place of occurrence and agency law. See paragraph 2-38 .

(d) Claims by prisoners under military jurisdiction are barred by the Feres doctrine. Federal prisoners may be covered by the Prison Industries Act, 18 U.S.C. § 4126, or by the LSHWCA, 5 U.S.C. § 8116.

(2) Claims arising in the United States. Within the United States, personal injury claims by persons with whom the United States has no contractual relationship or which do not arise incident to service or within the scope of employment must be considered initially under the FTCA, if based on tortious acts or omissions, except for maritime claims. If it cannot be determined whether the claim is a maritime claim, or if the claimant insists that it is despite USARCS' contrary belief, advise the claimant in writing of the need to file suit within two years of the occurrence.

(a) If the claim is based on a tort, it must be processed under the FTCA unless it arises out of a non-scope act. In this event, it may be considered under the Non-Scope Claims Act (NSCA). If processed under that Act, all parties must agree to the settlement, including the subrogee, who is barred from receiving payment.

(b) The MCA may be used, as appropriate, for claims arising out of noncombat activities. See paragraph 3-3 .

(c) Tort claims caused by NATO Soldiers or Soldiers from other countries that have implemented a reciprocal SOFA within the United States are handled exclusively by USARCS (except for investigation). USARCS is the receiving State office (RSO) for all such armed services. Claims by such Soldiers for their own personal injuries, sustained while in scope, are barred by the Feres doctrine.

(3) Claims arising outside the United States.

(a) Soldiers' claims based on a single act or incident cognizable under the MCA, the Army Maritime Claims Settlement Act (AMCSA), and the PCA will be considered first under the AMCSA or PCA. If not payable under either of those statutes, consider the claim under the MCA. If claims cognizable under the MCA are based on more than one act or injury and one or more of the acts or injuries are also cognizable under the FTCA (for example, claims alleging medical malpractice both in a foreign country and in the United States or claims alleging negligence in the conduct of a noncombat activity), the claims will be processed as follows: If the primary act or incident upon which the claim is based is not cognizable under the FTCA, the claim may be considered and paid under the MCA. If the primary act or incident upon which the claim is based is cognizable under the FTCA, the claim will first be considered under the FTCA. See paragraphs 2-73 and 2-75 for specific requirements that apply to settlement agreements and denials for claims considered under more than one statute.

(b) A claim may not be paid under the MCA if it is payable under the FCA, 10 U.S.C. § 2733(b)(2).

(c) If a SOFA or other agreement provides for host country adjudication of a claim, the treaty process is normally the claimant's exclusive remedy. Where a foreign country is responsible for adjudication of the claim under the terms of such an agreement, it may not be paid under the provisions of the MCA, FCA or FTCA. See, for example, Eyskens v. United States, 140 F. Supp. 2 d 553. If the foreign country refuses to accept legal responsibility for the claim or to consider it under applicable treaty provisions, the Commander USARCS may authorize adjudication of the claim for good cause shown. Examples, of good cause include the historical lack of SOFA jurisdiction over the claimant (not a proper party claimant) or subject matter (for example, quasi-contractual claims) and poor advice by the Department of Defense that causes the claimant to miss the SOFA statute of limitations. The mere fact that a foreign country has failed to pay a claim on its merits is not enough to invoke this authority. See AR 27-20, chapters 3 , 7 , and 10 .

c. Status of forces agreement claims. See chapter 7 for the statutory schemes that underlie the applicable SOFA.

(1) Proper place to file. SOFA claims should be filed directly with the designated office in the receiving State, which may either be a designated civilian office, as in Germany, or a foreign military unit. Where they are received by an Army claims office, they should be forwarded to the receiving State office. SOFA claims arising in the U.S. should be forwarded to the Commander USARCS.

(2) Europe. See AR 27-20, paragraph 7-2 , for a list of the countries that the Army has single-service tort claims responsibility for in Europe. This authority is exercised from the U.S. Army Claims Service, Europe (USACSEUR), Office of the Judge Advocate, U.S. Army, Europe (https://claimseurope.hqusareur.army.mil). SOFA claims must be submitted to the applicable host nation receiving State claims office in the jurisdiction in which they arose under the applicable North Atlantic Treaty Association (NATO) or Partnership for Peace (PFP) SOFA. ACOs and CPOs in those countries must screen all tort claims to determine whether the claimant is a proper claimant under the applicable SOFA and whether the claim arose from an act or omission of a member or civilian employee of the U.S. Armed Forces stationed or on temporary duty in those countries. In the European countries listed in AR 27-20, paragraph 7-2, any of the following may be a proper claimant under the NATO or PFP SOFA: an inhabitant of a foreign country, including one claiming for medical malpractice at a military medical treatment facility; a foreign country's corporations and local government bodies; an American civilian not a member of the force or civilian component; and a foreign subsidiary or element of an American corporation. USACSEUR should be consulted if a claimant's status is unclear. However, members of the force and civilian components and their family members are not proper claimants under the German Supplementary Agreement to the NATO SOFA or the Korean SOFA when the claim is based on an act or omission of the U.S. Armed Forces on duty within Germany or Korea. When a SOFA claim is filed with an ACO or CPO, assign a claim number, date stamp it, and instruct the claimant to forward it to the appropriate receiving State claims office. The ACO or CPO will retain a copy of the claim. If the claim is returned to the claims office, process it in accordance with chapter 3 .

(3) Republic of Korea. In the Republic of Korea (ROK), the Army has single-service tort claims responsibility, which it exercises from the Office of the Judge Advocate, U.S. Forces Korea (Claims) (FKJA-CL) (http://8tharmy.korea.army.mil/ClaimsSvc/). The screening procedures are similar to those used in Europe, except that members of the force and civilian components, and their dependents, are not proper claimants under the ROK SOFA. In the ROK, a claim by a foreign inhabitant for medical malpractice at an MTF is processed under the ROK SOFA.

d. Foreign Claims Act claims. See chapter 10 . To qualify as a proper claimant, the claimant must have been an inhabitant of a foreign country at the time of the incident giving rise to the claim. This can include retired service members who permanently reside in a foreign country and are not employed by the U.S. In countries such as the FRG, the ROK and the Republic of Panama, making this determination may be particularly difficult. Normally, foreign-born spouses are not considered proper claimants under the FCA, even if the foreign spouse has never been to the United States; however, a foreign-born spouse may be a proper claimant under the MCA. If, however, the spouse clearly exhibits an intention to remain a foreign inhabitant and never to immigrate to the United States, the FCA is the proper remedy. Children of the marriage who are born in a foreign country would be claimants under the MCA. Dependent parents of a foreign-born spouse would normally claim under the FCA, unless they had resided in the United States, or intended to immigrate to the United States. ACOs and CPOs should develop a questionnaire designed to elicit sufficient information to determine the proper claim authority. A sample questionnaire for determining whether a claim falls under the FCA or the MCA is posted on the USARCS Web site at "Claims Resources," II, a, no. 10.

e. National Guard Claims Act claims. See chapter 6 and paragraph 2-62c of this publication.

(1) Determining applicability. Members of the Army National Guard (ARNG) are employees of the state unless ordered into the federal service, such as during a national emergency or while performing duty under Title 10, United States Code. ARNG personnel remain state employees even when the United States has assumed tort liability under the FTCA' s 1981 amendment (AR 27-20, chapter 6 ) (United States v. State of Hawaii, 832 F.2 d 1116 (9th Cir. 1989); Maryland for Use of Levin v. United States, 85 S. Ct. 1293 (1965)). That amendment provided coverage for ARNG and active Guard Reserve activities giving rise to claims in the situations listed in (a) through (i) , below. For an activity to fall under any of these categories, the state must issue orders and the activities must conform to the orders, or drills for the unit training schedule. In other words, the Guard member must be performing duties or activities in accordance with the orders and not be engaged in a housekeeping action or the like. An ACO or CPO should investigate the following situations carefully and discuss FTCA coverage with the appropriate AAO.

(a) Instructing civilians at rifle ranges (32 U.S.C. § 316).

(b) Attending drill assemblies or participating in exercises or encampments, typically inactive duty training (32 U.S.C. § 502).

(c) Participating in certain maneuvers, typically two weeks annual training (32 U.S.C. § 503).

(d) Participating in small arms competition or attending schools for the ARNG (32 U.S.C. § 504).

(e) Attending regular service schools (32 U.S.C. § 505).

(f) Recruiting full-time (32 U.S.C. §502(f)).

(g) Performing active Guard Reserve duties with the state (32 U.S.C. § 502(f)).

(h) Performing federal drug enforcement duty (32 U.S.C. § 502(f)).

(i) Performing community based activities under 10 U.S.C. §§ 2012 and 2558.

(2) Additional considerations for Army Reserve National Guard activities.

(a) The ARNG is often involved, incident to federally funded training in Title 32 status, in projects that assist state or local governments or various private organizations, usually youth groups or national military associations. Specific statutory authority for such incident-to-training assistance is contained in 32 U.S.C. § 508, 10 U.S.C. § 2012, and 10 U.S.C. § 2558, and other statutes. Claims arising from such duly authorized projects are cognizable, notwithstanding the fact that a government entity or private organization may derive a benefit. Other projects, particularly those that cannot be supported on an incident-to-training basis, may be accomplished in a state active duty status. Claims arising from state active duty missions are exclusively a state responsibility.

(b) The ARNG is involved under 32 U.S.C. § 112 in providing assistance to law enforcement agencies in counter-drug operations. Such support is generally provided in a Title 32 duty status (other than training) and claims arising therefrom are cognizable. Separate and apart from 32 U.S.C. § 112, the 1991 National Defense Authorization Act authorizes assistance, incident to training, to law enforcement agencies in counterdrug operations. Again, such claims arising in Title 32 training status are cognizable. However, where a state employee is actively participating in the operation, investigation must be sufficient to determine whether any claim is a state or federal responsibility.

(c) Claims based on premises liability at a state-owned or leased armory or training site are generally the state's responsibility. Examples of such claims include an exploding dud, motorcyclist running into wire barriers, person falling into a trench dug across a roadway, a person falling on an icy stairway or parking lot, or vehicle damage from grass mowing operations.

f. Third-party claims involving an independent contractor.

(1) Generally. See subparagraphs 2-45b , c , and d , 2-46 , and 2-62b of this publication. The United States is not liable for claims arising from the act of an independent contractor (28 U.S.C. § 2671), including NAFI or AAFES contractors or concessionaires. Upon receipt of a claim, the ACO and CPO should determine if a contractor is involved. Frequently, claimants file for loss or damage stemming from housekeeping contracts for the Commissary, MTF, Army motor pools, or other buildings and maintenance of facilities (such as spraying of paint or insecticides). AAFES concessionaires or contractors may be involved. Army MTFs use the services of TRICARE partners or contractors who supply physicians and related services, such as emergency room and radiology services. When a contractor is involved, examine the contract, obtain the contractor's address and the name of its insurer and inform the claimant that a claim should be filed against the contractor. When there is joint liability, furnish this information anyway. Such warning should be made as soon as possible to avoid the running of a state statute of limitations which is applicable to a suit against a contractor. See paragraph 2-45b and c for more discussion on independent contractors generally.

(a) If the damage is considered to be primarily due to the contractor's fault or negligence, refer the claim to the contractor or the contractor's insurer for settlement. Although the claim against the Army will not be processed under AR 27-20 , the advance notice procedure to the AAO contained in AR 27-20, paragraph 2-1 , will be followed. When possible, ask the claimant to refer the claim personally to the contractor.

(b) If the contractor does not dispose of the claim within a reasonable period of time, determine whether the Army is legally liable to the third-party claimant for the damage. Base this determination on the same standards used to determine contractor liability. When the United States exercises sufficient control over the contractor's operations or a specified process (such as spraying) at a place where such operations or processes could cause the damage, federal liability may be invoked.

(c) If it is determined that the United States may be liable, ask the contracting officer to withhold funds due the contractor. Funds may be withheld as long as the contract specifies that the contractor is responsible for damages that occur as a result of its fault or negligence and provided that the contract contains no clause to the effect that the contractor is not responsible for negligence of the United States or its employees; see Motor Ins. Corp. v. Aviation Specialties, Inc., 304 F. Supp. 973 (W.D. Mich. 1969). It is not necessary that a claim actually be paid under AR 27-20 before funds can be withheld.

(d) If withholding is not considered permissible, forward claims payable under the FTCA to the Commander USARCS for disposition. Include all pertinent data concerning contribution or indemnity in the file.

(2) Claims for injury or death of contractor employees. See paragraphs 2-38 and 2-62b of this publication.

(a) Claims by contractor employees for injury or death are payable from workers' compensation benefits provided by the contractor and should first be processed in this manner. In most U.S. jurisdictions, the workers' compensation remedy bars further action against the contractor except at management level. In this regard, determine whether insurance coverage of management activities is available. Such coverage usually does not bar action against the United States, and if a claim not satisfied wholly by workers' compensation is pursued further against the Army, it will be processed under AR 27-20. However, this is a matter of local law; examine it carefully in each case. In any event, a payable claim must be based on negligent acts or omissions of U.S. employees, not contractor employees.

(b) In processing such claims, examine the contract between the United States and the employer, or any related subcontract, to learn whether it holds the United States harmless and imposes liability on the contractor. Unless the provisions make it clear that the contractor is not liable to any extent, try to get the contractor to assume the burden of settling the claim. For example, such provisions often provide that the contractor will hold the United States harmless from claims arising in part from the negligence of the United States. In such cases, contractor liability should be pursued, United States v. Accrocco, 297 F. Supp. 966 (D.D.C. 1969). Should the claim arise in part from the negligence of the United States and the contract is silent as to whether the contractor will hold the United States harmless in such a case, examine appropriate case law and pursue contractor liability, if appropriate.

(c) Generally, the contractor need not be pursued when the claim arises solely as a result of the negligence of the United States and the contract does not expressly provide for the contractor to hold the United States harmless in such a case. Piscopo v. United States, 167 F. Supp. 777 (E.D.N.Y. 1958). When the claimant is an employee of the contractor who has received workers' compensation benefits provided by the contractor, federal law controls the right of the United States to indemnification under a federal indemnity contract. Include the contractual provisions in the claim file since they will determine the right to contribution or indemnification, United States v. Seckinger, 397 U.S. 203 (1970). This is true regardless of whether state law provides that workers' compensation benefits are the employee's exclusive remedy against the employer. Compare American Agricultural Chemical Co. v. Tampa Armature Works, Inc., 315 F.2 d 856 (5th Cir. 1963) with Spurr v. LaSalle Construction Co., 385 F.2 d 322 (7th Cir. 1967).

(d) If the United States has compensated the contractor for the latter's workers' compensation premiums, the Army may be able to deduct any payments made by workers' compensation to the claimant from any award the Army makes. Further, in such instances a claim by the workers' compensation carrier will be forwarded for resolution by the AAO. Similarly, the United States may have paid the premiums for other coverage (such as life insurance and funeral expenses in a death case), and these may also be deductible. Ask the contractor if such benefits exist, since the contract itself may not reveal their existence. Place a record of the results of the inquiries in the file.

(e) If the claim by the contractor's employee is based on the theory that the United States was in control of the contractor or otherwise in charge (for example, by regulating safety) rather than on a specific act of negligence by a federal employee, examine local law to determine whether a statutory employer defense is available to the United States. This defense is generally based on the extent of control, for example, the contract is performed on U.S. property, concerns an activity in which the government is normally engaged (mess hall or motor pool activities), and the government has paid the cost of workers' compensation premiums, directly or indirectly, as part of the contract price, Roelofs v. United States, 501 F.2 d 87 (5th Cir. 1974), cert. denied 423 U.S. 830 (1975). See FTCH § II, D7.

(f) Claims falling under the Defense Bases Act, 42 U.S.C. §§ 1651-1654, are payable exclusively under the worker's compensation insurance required by that Act.

g. Claims by contractors for damage to or loss of their property during the performance of their contracts.

(1) Claims by contractors for damage to or loss of their property during the performance of their contracts are payable as contract claims where the damage or loss occurs as a result of in scope acts or omissions by a service member or civilian employee. Such claims are not payable under the FTCA even if the contract funds are insufficient to pay the contract claim. If the contracting officer denies the claim, the claimant must exhaust his contract appellate remedy prior to consideration under the MCA or FCA as a bailment claim.

(2) If damage or loss occurs from the act or omission of a third party while the property is bailed to the U.S., the claim may be considered under the MCA or FCA if not payable as a contract claim. Whether it is payable depends on duty of the government under the type of bailment in question. Prior to consideration under the MCA or FCA, review the contract to determine whether the contract provides for security of the property. If so, process the claim as a contract claim.

(3) Process in accordance with subparagraph (1) , above, claims by contractors for damage to, or loss of, property being rented, leased, loaned or sold to an agency of the United States that is in the Army's possession to facilitate performance of such contracts (for example, property is in transit or in temporary storage). Also, sometimes insurance coverage purchased by the contractor and included as a contract cost may be available to pay the cost (for example, if a Soldier or civilian employee rents a car while on TDY, 35 Comp. Gen. 553 (1956)). Accordingly, scrutinize contractual provisions and refer the claim to the insurance carrier, if appropriate. If such property is rented, leased, loaned by or sold to the Army and is in the possession of the Navy or Air Force for shipment or storage when the damage or loss occurs, forward the claim to the Navy or Air Force for settlement as an MCA bailment claim.

h. Maritime claims. Maritime claims must be identified as such upon receipt by use of the criteria in paragraph 8-4 . The claimant must be informed that the claim lies within the maritime jurisdiction of the U.S. and any suit must be filed not later than two years after the accrual of the claim. In case of doubt as to whether the claim is maritime, or if the claimant states the claim falls under the FTCA, inform the claimant in writing that the claim will be treated as maritime for purposes of timely filing even if filed under the Admiralty Extension Act (AEA), 46 U.S.C. § 30101.

i. Postal claims.

(1) General guidance. The FTCA specifically excludes claims for losses due to transmission of postal matter (28 U.S.C. § 2680(b)). However, there are three types of postal claims that may be considered through channels outside the scope of the FTCA. These are: interagency claims filed by the U.S. Postal Service against the Military Postal Service pursuant to an interagency agreement; claims for loss of registered or insured mail in the possession of the U.S. Army (cognizable under the MCA); and claims for packages delivered by United Parcel Service (UPS). General guidance on each of these is provided below.

(2) Interagency postal agreement claims.

(a) Claims by the U.S. Postal Service are only cognizable pursuant to a special interagency agreement between the U.S. Postal Service and the Military Postal Service. The agreement is posted on the USARCS Web site on JAGCNet at "Claims Resources," I, a, no.13(d). DOD 4525.6-M provides comprehensive guidance on the military postal system including some general information about how postal losses should be handled; see also DODI 4525.7 at E.3.5.

(b) Interagency agreement claims are claims brought by the U.S. Postal Service for funds and accountable postal stock embezzled or lost through the negligence or error of unbonded Army postal clerks, assistant Army postal clerks or persons acting in those capacities, and commissioned or warrant officers of the Army designated as custodians of postal effects by the appropriate commanding officer. These claims almost invariably arise in foreign countries.

(c) Interagency postal claims must be filed by the U.S. Postal Service within one year of the discovery of loss. The loss must be due to fault on the part of Army personnel listed in subpara (b) , above. For example, a claim for loss of postal monies due to robbery of a postal clerk is not payable unless there is evidence that the clerk or other Army postal personnel were at fault. Similarly, if the loss is caused by the fault of non-postal personnel, the claim is not payable. For example, if mail is destroyed in an Army truck involved in a collision and fire, the U.S. Postal Service claim is not payable under the interagency agreement unless there is evidence that the driver was one of the persons listed in subpara (b) and that the accident was due to the driver's negligence.

(d) Local claims offices do not become directly involved in interagency claims because the U.S. Postal Service files the claims with USARCS. However, local JAs or legal officers who learn of a potential claim due to theft or dereliction of duty on an Army postal clerk's part should take steps to see that the Army postal clerk reimburses the U.S. Postal Service for the loss. For example, an Army postal clerk may be required to make restitution prior to separation or as part of a plea bargain.

(3) Postal claims for loss or damage to registered or insured mail. See also paragraph 2-30 (for information on investigation of these types of claims) and paragraph 2-56g (for how to measure damages in claims related to registered or insured mail).

(a) The MCA specifically provides coverage for loss or damage to registered or insured mail only. The mail must be controlled by use of a registry or some other device allowing its course to be traced and responsibility for its loss to be determined. Otherwise, the loss or damage is not within the terms of the MCA. For example, the U.S. Postal Service once created a type of insured mail known as "insured minimum fee," for which no record was kept of delivery to the recipient. This type of mail was not included in the provisions of the MCA because of its lack of registry. Other types of mail, including certified mail and Express Mail, also are not included within the terms of the statute, even though the U.S. Postal Service guarantees Express Mail's delivery times and document reconstruction.

(b) It must be determined that the Army is responsible for the loss. When a claimant, either the sender or recipient, alleges that a registered or insured package was lost or damaged while in postal channels, the claimant should be directed to file the claim with the U.S. Postal Service. The U.S. Postal Service will trace the parcel and determine whether the loss occurred in U.S. Postal Service channels. If the U.S. Postal Service determines that it is not responsible for the loss, it forwards the claim, with a complete investigation, to the Army for further action. (If the loss or damage occurs after the mail has left all postal channels, the claim may be considered under the PCA ( chap 11 ). This would include, for example, a courier or other Soldier picking up the mail at the Military Postal Service and rifling it.)

(4) United Parcel Service package claims. The UPS has agreed to be liable for payment of claims for loss or damage to packages delivered in the continental U.S. (CONUS) to Army mailrooms or other Army employees for delivery to the addressee, The procedures for unit mail room clerks that are established by the UPS agreement are set forth in AR 600-8-3, appendix B (Delivery of UPS Material by Unit Mailrooms). Claimants seeking reimbursement for losses covered by the agreement should be given a copy of the procedures and referred to UPS. The UPS offices sometimes seek reimbursement for payment to a customer for loss or damage to a package. These claims should be denied on the basis of the UPS agreement. Where a unit mail clerk or another unit member acting in that capacity signs the UPS delivery record, UPS will provide a copy of the delivery record.

(a) UPS remains liable for all property damage to package contents even though a unit mail clerk has signed for the item.

(b) UPS agrees to hold harmless and reimburse the United States for any claims or judgments that the United States is legally required to pay as a result of property loss or damage to packages received from UPS.

(c) UPS will remain liable for a lost package even though a unit mail clerk has signed for the package pursuant to its tariff provisions on file with the Interstate Commerce Commission and the individual Public Service Commissions in the states in which UPS operates.

j. Blast damage claims. See paragraph 2-28 .

(1) Blast damage claims are payable under the MCA. While the claimant need not prove negligence, the claimant must prove a connection between the blast and the damage. Only causation need be established. See paragraph 3-3b .

(2) To achieve consistency in determining causation, AR 27-20, chapter 2 , requires that blast damage claims should be forwarded to USARCS along with the information set forth in paragraph 2-28 through 2-48 for review by a blast damage expert located at or used by USARCS. If another claim under the exact circumstances has already been reviewed, such as similar damage to the house next door, the ACO or CPO should coordinate with the AAO to waive the requirement for USARCS technical review. Similar damages usually mean the type of damage caused by air blast, such as broken windows, and not ground shock, such as a cracked basement wall.

(3) Payment for nuisance value alone leads to other claims or protests by neighbors, particularly those whose claims have been denied previously. This should not be done.

k. Motor vehicle damage claims arising from the use of non-government vehicles. See also paragraphs 2-61 (joint tortfeasors), 2-62e (indemnity or contribution), and 2-70 (splitting personal injury and property damage claims) and similar topics in AR 27-20, chapter 2.

(1) Third party vehicular damage claims caused by use of privately-owned vehicles.

(a) AR 27-20, paragraph 2-15k , requires that third parties' tort claims against the United States arising from the use of a privately-owned vehicle (POV) by a Soldier or civilian employee allegedly within the scope of employment must be forwarded to USARCS for a decision prior to any final action. This requirement arises from the difficulty in determining scope in such cases and maintaining any degree of consistency. See FTCH § II, B3.

(b) Always determine whether the liability insurance on the POV may be used to fund at least part of the settlement. Of particular interest are insurance policies that contain exclusions made without regard to reduction of the premium. Research the law of the state in which the contract was entered to determine if it prohibits such an exclusion. This is significant because Soldiers or civilian employees use their POVs for various errands of possible benefit to the Army. See FTCH § II, D8.

(c) Before forwarding, conduct an investigation to assist in a scope determination. While the nature of the investigation varies from case to case, always determine whether mileage was reimbursable and, if not, whether the use was specifically authorized by the command. If the POV was used for more than one purpose on one trip, list the various purposes and routes.

(2) Claims by lessors for damage to rental vehicles.

(a) The U.S. Government Visa travel charge card provides insurance coverage for damage to the rented vehicle to all Soldiers and employees who rent qualifying vehicles (essentially passenger sedans and seven-passenger vans) using the U.S. government travel card for 30 days or less worldwide except in Jamaica, Ireland, and Israel. This coverage requires that the traveler notify Visa International Service Association at 1-800-VISA-911 (1-800-847-2911) within 20 days of the damage to the rented vehicle and complete and submit an accident report to Visa within 70 days of the damage. This coverage is independent of any other insurance provided to the renter. The coverage is primary for damage caused while an authorized driver was acting within the scope of his employment, and secondary to other coverage when the driver was using the vehicle for personal use, such as during personal time over a weekend while on a two-week TDY period.

(b) The U.S. Government Car Rental Agreement (formerly the Military Traffic Management Command (MTMC) Agreement, now known as the Surface Deployment & Distribution Command (SDDC) Agreement), effective 1 October 2002, provides that Soldiers and employees on TDY who rent a passenger vehicle or qualifying passenger van from a participating rental agency in other than a fleet rental arrangement are furnished collision insurance by the lessor and its insurer. The Agreement is posted to the USARCS Web site at "Claims Resources," II, a, 11. The Agreement may also be viewed at the SDDC Web site at http://www.sddc.army.mil/ , by clicking on "passenger," "car rental carriers," then "car rental agreement." Under this coverage, the lessor assumes responsibility for all collision damage to its vehicle, provided the member or employee driving the vehicle did not cause the damage through willful conduct or wanton negligence, nor through one of the listed exceptions in SDDC Agreement, paragraph 9. This coverage applies only when the traveler was acting within the scope of his employment when the loss or damage occurred. Claims arising when a traveler is not within the scope of duty, such as for detours or frolics, are the traveler's individual responsibility. Deny any claim for damage covered by this insurance with an explanation that it is not cognizable under any statute or regulation and refer the claimant to the SDDC Agreement, paragraph 9b.

(1) If the lessor refuses to accept liability for damage to its vehicle under the rental contract based on the lessor's belief that the driver's conduct voids the insurance coverage, process the claim by referring the claimant (lessor, lessee or lessor's insurer) to the appropriate Army disbursing office for disposition under the Joint Federal Travel Regulations (JFTR), paragraphs U3415 c(2)(b) and (c) or C2102-D2, available on the Web.

(2) If the rental agency attempts to collect directly from the renter rather than filing a claim with the renter's unit, inform the rental agency that the SDDC Agreement requires it to first file with the unit. Rental agencies can only pursue the individual renter when the renter's unit has determined that the damage occurred due to acts or omissions of the renter not within the scope of his duty.

(c) If the rental agency does not participate in the SDDC Agreement, claims for damage to or loss of the vehicle are contract claims and are not cognizable as tort claims. Forward any demand for compensation for the damage or loss to the contracting authority through which the contract for the vehicle rental was obtained.

(d) In tort claims where the renter either failed to use or comply with the provisions of the government Visa travel card or to rent from a SDDC participating rental agency, the claim will be paid directly from the unit travel funds. Either the traveler can pay the rental agency and request reimbursement on the travel voucher ( DD 1351-2 ); the rental agency can send a claim to the unit commander, who, after certifying that the damage or loss occurred while the traveler was within the scope of his duties, sends the claim to the servicing Defense Finance and Accounting Service (DFAS) office for payment, JFTR, paragraphs U3415 c(2)(b) and (c) or JTR C2102-D3; or the rental agency can send a claim directly to the unit's servicing DFAS office for payment, DOD Financial Management Regulation (FMR), vol. 9, chapter 4 , paragraphs 040704 - 040705.

(3) Third-party damages arising from the use of rental vehicles. Third-party damages and injuries arising from the use of rental vehicles are discussed at paragraph 2-62e .

l. Claims arising from gratuitous use of DOD or Army vehicles, equipment, or facilities. Frequently, nonfederal organizations, companies or individuals are granted free use of government land, vehicles, or equipment, and such use results in tort claims. Gratuitous user claimants may be students, volunteers, members of scouting organizations, foreign military personnel, or persons injured during fundraising or recreational activities. Third parties whose property is damaged during debris removal following a natural disaster in which a state governor requests federal assistance may also be gratuitous claimants. See subparagraph(5) , below. Liability may exist under AR 27-20 ; before processing such claims, however, consider the following issues:

(1) Departmental or local directives often require the execution of a hold harmless or similar clause before Army facilities, transportation, or equipment are used. Whether such clauses are legally enforceable should be determined by local law, based on the following factors:

(a) Whether the arrangement between the United States and the sponsoring agency is binding on the individual claimant.

(b) Whether a benefit is derived by the Army, the individual claimant, or both.

(c) Whether the Army is furnishing the benefit under an obligating statute or authority or on a voluntary basis.

(d) Whether public policy considerations are involved.

(2) Generally, hold harmless clauses are ineffective unless agreed to by both the individual claimant and the sponsoring organization and unless the latter maintains a program or method of compensation similar to workers' compensation or other insurance. Examine any insurance policy involved to see whether the DA is an insured party (if not, the insurance carrier may be subrogated to the claimant's interests). Urge Army officials arranging such functions for gratuitous users to require adequate third-party liability insurance that includes the DA as an insured party. In any event, scrutinize such claims to see whether other benefits are available to the claimant before processing under AR 27-20 or whether such benefits are considered a collateral source and thus are not deductible from any payment made under AR 27-20.

(3) If contribution or indemnity applies but the matter cannot be resolved, forward the claim to the Commander, USARCS, 28 C.F.R. § 14.6(d)(1)(iii) . Attach a copy of the contract, any insurance policy, and a record of the status of the negotiations, including efforts to obtain contribution or indemnity in the file. If the claim involves Army transportation, state whether any guest statute applies.

(4) Third-party claims may arise from acts or omissions of individuals such as students, volunteers, members of scouting organizations, foreign military personnel, or other persons present on a military installation in connection with fundraising or recreational activities. These persons may be liable under the "loaned servant" doctrine or other employment-type relationship. Generally, these do not depend on compensation from federal sources but turn on either the extent of direction and control exercised by the United States or its responsibility as the owner of land or equipment. See paragraph 2-45d (volunteers). Hold harmless clauses do not bar third-party claims unless the third party is privy to the agreement permitting use of DA premises. The clause's main value is derived from any insurance or other third-party compensation program provided by the sponsoring organization or the individual involved. Refer third-party claims to the sponsoring organization or individual concerned or to either party's insurer. If not resolved by such referral and if contribution or indemnification is considered inapplicable or cannot be obtained, refer the claim to the Commander, USARCS, with all pertinent data concerning contribution or indemnity included in the file. See paragraph 2-62 (indemnity).

(5) Debris removal claims present a different problem in that a state or local government must agree to indemnify the government against any claim arising from debris removal from private property. See 42 U.S.C. § 5173. The Federal Emergency Management Agency (FEMA) represents the federal government in providing disaster relief. Past experience has indicated that the senior Army JA of a task force engaged in such a mission should arrange with a state to assume responsibility for the settlement of such claims after a special claims processing office investigates. Attempts should be made to have the state assume liability not only for claims arising at the site but in addition for claims arising from travel to and from the home station of any unit to be used for debris removal.

m. Real estate claims.

(1) Claims for rent, damage, or other payments involving the acquisition, use, possession, or disposition of real property or interests therein by and for the DA are generally payable under AR 405-15, paragraphs 5 and 6 . Claims for damage to real property and incidental personal property damage sustained during Army noncombat activities are payable under either AR 405-15 as a real estate claim or AR 27-20, chapters 3 or 10 as trespass claims. Such claims usually arise during a maneuver or training exercise or an emergency deployment. If the property is occupied pursuant to a lease or use permit and if operation and maintenance funds are available for payment of damage claims, refer to AR 405-15. The length of time the land is occupied is the general guideline for determining whether to pay a claim as a trespass (using damages to the property and loss of use as a measure of damages) or as a real estate claim. (Rent is only payable for a real estate claim.) If 30 consecutive days or less, the claim is normally considered as a trespass; if 31 consecutive days or longer, the claim is normally considered as a real estate claim. See U.S. Army, Europe Real Estate/Office of the Judge Advocate Standard Operating Procedures for Processing Claims Involving Real Estate During Contingency Operations (20 August 2002). This may be accessed through JAGCNet intranet menu selection, or directly at the U.S. Army Claims Service Europe homepage at https://claimseurope.hqusareur.army.mil, at the publications/regulations menu selection.

(2) Take care to avoid splitting the claim (by considering the real property claim under AR 405-15 and the incidental personal property claim under AR 27-20, chapters 3 or 10). Instead, consider the entire claim under AR 405-15 by referring to the lease's restoration clause. If this is not possible, or if operation and maintenance funds are not available, include a statement to this effect in the file and process the remainder of the claim under AR 27-20, chapters 3 or 10 or . There should be careful coordination with the COE district real estate claims office to avoid duplicate payments. See AR 405-15, paragraph 9b . Note that a lease may be entered into after the fact of occupancy. See AR 405-15, paragraph 5.

(3) Claims for damage to real property and incidental personal property damage arising out of Army activities considered to be neither combat nor noncombat activities are payable under AR 405-15. They are also payable under AR 27-20, chapters 3 and 10 and , but only if founded in tort. Normally, such claims arising during civil emergencies should be processed under AR 405-15; contingency planning should include adequate operations and maintenance funding for such claims.

(4) Real estate claims based on a Fifth Amendment taking of property such as navigation easements, or claims based on continuous invasion of property (such as by overflight, noise, smoke, gases, or water emanating from government sources) fall under the Tucker Act. See paragraph 2-17h(1) . Take care to distinguish these claims from those based on tort or noncombat activities — that is, distinguish claims based on a continuing invasion, including a taking, temporary or permanent, from claims based on damage to the property.

(5) If the invasion is found to be of a continuing nature, try to settle the claim through real estate acquisition procedures. In such instances, claims offices should coordinate with the appropriate division and district engineers or the Directorate of Real Estate, Office of the Chief of Engineers.

(6) Under certain conditions, process these claims under the Federal Acquisition Regulation (FAR), part 50 and 50 U.S.C. § 1431, for example, if a contract instead of a lease was used to rent certain real estate and claims arise that are not payable under the contract.

n. Claims generated by civil works projects. Civil works projects that may generate claims include dams, bridges, and reservoirs. They are specifically identified by their legislative history and appropriation. The COE investigates and processes claims arising out of civil works projects in the same way as any tort claim. Payment procedures, however, are different. See paragraph 2-8e for specific payment procedures that apply.

2-16. Unique issues related to environmental claims

a. General. This paragraph presents a general discussion of the unique issues involved in receiving and processing tort claims based on environmental contamination allegedly attributable to CONUS Army operations. Most environmental contamination problems facing the installation lawyer do not involve claims under AR 27-20 .

(1) There are two types of environmental claims. The first type asserts damage or injury resulting directly from the contamination; these claims are processed under AR 27-20. The second type seeks to recover the costs of or, damages attributable to, the necessary "cleanup" response; these claims are processed under the Defense Environmental Restoration Account (DERA). The line between these types is often obscure and difficult to draw, requiring close coordination between claims and environmental personnel. However, under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), 42 U.S.C. §§ 9601-9675, an FTCA suit is prohibited during a CERCLA cleanup, 42 U.S.C. § 9613h.

(2) For a claim to be classified as either an environmental or a "toxic tort" claim, the claimant must allege that the damage or injury was due to a legally recognized civil wrong. Many claims do not assert a state tort based on the government's "wrongdoing" Instead, they typically allege an activity (such as disposal of industrial chemicals) and an adverse result (risk of cancer). Often, claimants file after an environmental survey has been conducted, at which time the ACO or CPO must review such claims carefully to determine whether to refer them to environmental personnel for processing under DERA. The claimant should be advised of proper procedures.

b. Comprehensive Environmental Response, Compensation, and Liability Act.

(1) CERCLA sets out an environmental restoration program administered by the Environmental Protection Agency (EPA). See 42 U.S.C. §§ 9601-9675. Although the statute does not create new tort remedies for individuals damaged or injured by environmental contamination, Congress by enacting it demonstrated its intent that the federal government shoulder the burden of environmental cleanup together with private industry. The statute expressly permits a private individual to sue, not for damages, but to ensure compliance with the CERCLA mandate. The DOD, by agreement with the EPA, administers the DERA program which is designed to carry out CERCLA objectives and remedies.

(2) When presented with a claim alleging damage or injury resulting from the release of a hazardous substance into the common environment, the ACO or CPO must determine whether CERCLA procedures may abate the release or ameliorate both its short-term and long-term effects. If the installation elects to abate a release of contamination or ameliorate its effects, whether as the result of a claim or not, its legal staff must inform the command and the civilian community that the Army is acting under the mandate of the Installation Restoration Program and not because of potential tort liability.

c. Defense Environmental Restoration Account.

(1) The Army first responded formally to the need for cleanup of hazardous waste sites in 1975 by instituting the Installation Restoration Program. This program was aimed originally at a few known trouble spots but soon expanded to cover all Army installations. In 1976, DOD expanded the program throughout the Services, naming the Army its executive agent.

(2) The DERA was established pursuant to the Defense Appropriation Act of 1984. The program was expanded to include cleanup of former DOD sites as well as active installations. Although the military departments individually identify, develop and implement their own cleanup projects, the Secretary of Defense controls the DERA. As funding needs are identified and developed, DOD transfers funds to existing accounts administered by the military departments.

(3) Local military or civilian environmental law specialists are responsible for active installations or activities. COE Headquarters Environmental Restoration Division, Washington, DC, is responsible for closed installations or activities.

d. Theories of tort liability and damages.

(1) Environmental tort litigation is replete with diverse theories of liability, some traditional and some new and creative. Several of the more novel theories that a few courts have adopted originated in product liability cases against multiple pharmaceutical company defendants. The traditional theories commonly urged in support of toxic tort liability include trespass, nuisance, negligence, assault and battery, and strict liability. Trespass does not usually apply to claims against the government because there is rarely evidence of the necessary intent. The same is true of assault and battery. However, under the proper circumstances, state nuisance laws may provide a viable remedy against the federal government, especially on contamination release caused by waste disposal practices.

(2) Plaintiffs seek compensation for such damages as emotional distress resulting from knowledge of exposure to a toxic substance, the need for future medical surveillance because of such exposure, cancer phobia, and the increased risk of suffering future injuries or illness. Although the courts have generally rejected such damages, which often amount to new causes of action, as too speculative, plaintiffs have made significant inroads in some jurisdictions. For the most part, however, these theories have failed because of the scientific uncertainty about causation rather than from the conceptual basis of liability. See FTCH § II, C30.

e. Typical installation contamination situations. The following are typical scenarios, each presenting its own problems and challenges:

(1) Groundwater contamination arising from:

(a) Past solid waste disposal practices (such as landfill disposal).

(b) Past or present industrial operations (such as evaporation basins, solvent disposal, and chemical storage).

(2) Lead paint or asbestos exposure to occupants of quarters, installation employees, contractor employees, and the public.

(3) Use of pesticides, herbicides, fungicides, and rodenticides.

(4) Sales of excess or salvage property containing hazardous materials, such as polychlorinated biphenyls found in transformers sold by local property disposal offices or contaminated drains or boilers used in the manufacture of explosives.

(5) Defective or inadequate water treatment.

(6) Defective or inadequate sewage treatment.

(7) "Chance" exposure to military chemical munitions, usually due to past practices of canister or drum storage or disposal.

(8) Exposure to bacteria used in Army tests for establishing dispersal patterns.

f. Role of the area claims office or claims processing office.

(1) Most allegations do not arise out of a single incident of exposure to a toxic agent that produces immediate, identifiable personal injury. The more typical toxic tort claim involves many potential claimants who allege long-standing exposure to multiple hazardous substances. This usually occurs against a background of public concern and media attention. However, causation is often obscured by scientific and medical disagreement. The passage of time, witnesses' fading memories, and the routine destruction of documentary evidence all combine to "contaminate," or blur, the facts relevant to a negligence inquiry. Because multiple toxic tort claims involve potential class action lawsuits, plaintiffs often file administrative claims merely as the necessary first step to litigation: they have no real expectation of administrative settlement. In this atmosphere, it is not surprising that the Environmental Tort Branch of DOJ closely monitors these claims from their inception. The ACO or CPO faced with a claim asserting a toxic tort must investigate it as thoroughly as possible. Since lawsuits will likely ensue, this thoroughness is in the Army's interest.

(2) Obtain investigative assistance from the following sources:

(a) Virtually all Army installations that conduct operations likely to affect the environment employ one or more environmental specialists. These experts, either Soldiers or civilian employees, are professionals charged with guiding the installation's environmental management. They are usually well-trained in both science and the federal and local legal framework.

(b) Another good source of information is the state environmental regulatory agency, which has a long-standing relationship with the installation, often in a watchdog role.

(c) Each MACOM employs one or more environmental law specialists within the OSJA who are well versed in DOD and DA regulatory requirements and policies. Environmental Law Division, Office of the Judge Advocate General (OTJAG), has extensive experience in environmental matters and is the focal point for DA policy and litigation in this field. Consult the AAO upon receiving of an environmental claim or upon learning of potential claims.

(d) Army or DOD sources of technical assistance include the U.S. Army Environmental Hygiene Agency, the COE Headquarters Environmental Restoration Division, the U.S. Army Medical Bioengineering Research and Development Laboratory, and the DOD Hazardous Materials Technology Center.

g. Notifying Department of Justice. Forward copies of toxic tort claims to USARCS. In turn USARCS will notify the Environmental Law Division, OTJAG and the Environmental Law Branch, DOJ for comment and direction.

2-17. Claims remedies outside of AR 27-20

a. Scope. This paragraph provides information and guidance on processing demands for monetary compensation outside of AR 27-20 . This compilation is by no means exhaustive, and claims personnel should research the law on incoming claims to be sure that no other means of claims disposition resides elsewhere within the Army, other federal agencies or the courts. Even if no such means is available, forward the claim to USARCS with both a factual summary sufficiently detailed to permit proper disposition and a statement as to why no means for settlement are available.

b. Claims by war victims, including internees, and prisoners of war.

(1) Combat claims and most claims statutes explicitly exclude claims arising out of war or armed conflict. In certain cases, the United States and the host government may mutually waive such claims through a status of forces agreement. In others, the host government has discharged and held the United States harmless from such claims in exchange for either a lump-sum payment or economic and military assistance. Belligerent nations have released the United States in certain cases.

(2) Under the War Claims Act of 1948 (50 U.S.C. app. §§ 2001-2016), the War Claims Commission initially adjudicated claims arising out of World War II of U.S. prisoners of war, internees, and organizations and individuals of nations allied to the United States. The statute was later amended to include U.S. citizens who were internees and prisoners of war during the Korean War and to expand the categories of World War II claimants. Today, the only program that is still open addresses claims of civilian internees or Soldiers or their survivors held in captivity during the Vietnam War. Their claims are adjudicated by the Foreign Claims Settlement Commission as successor to the War Claims Commission.

(3) Congress enacted Titles III and IV of the International Claims Settlement Act of 1949, as amended (22 U.S.C. §§ 1641-1642), 64 Stat. 13. This authorized the Foreign Claims Settlement Commission to determine certain claims of U.S. nationals against the governments of Bulgaria, Czechoslovakia, Hungary, Romania, Italy, and the Soviet Union. The Foreign Claims Settlement Commission started similar programs concerning Yugoslavia, Cuba, Iran, The People's Republic of China, the Democratic Republic of Germany, Vietnam, Ethiopia and Egypt. Currently, the FCSC is adjudicating property claims against Albania which is the only 22 U.S.C. § 1621 program still open. It is anticipated that legislation will permit claims against Iraq (such as those of survivors and veterans of the conflict there). Address inquiries to: Foreign Claims Settlement Commission Suite 6002 600 E. Street, N.W. Washington, D.C. 20579-0001 Commercial: 202-616-6975.

(4) For a claims view of the conflict in Grenada, see J. L. Harris, "Grenada: A Claims Perspective," The Army Lawyer , January 1986, p. 7. Both the Grenada and the Dominican Republic deployments have been construed to bring the combat exclusion rule into play. This accords with the United Nations practice barring claims arising out of acts based on military necessity in the Gaza Strip, Cyprus, and the Congo. When the United States joins a multinational force and an international body assumes operational control (as the Organization of American States did in the Dominican Republic and the United Nations did in Somalia) that international body becomes responsible, at least concurrently, with its member nations for settling claims that their forces generate. Accordingly, the approval or settlement authority should seek advice from the Commander USARCS before paying any claims under the FCA. See paragraph 2-37 for a discussion of the incident to service doctrine.

c. Claims cognizable by other agencies.

(1) Department of State.

(a) The Secretary of State may provide compensation for the personal injury or death of an individual not a national of the United States located in a foreign country in which the United States exercises privileges of extraterritoriality. The Secretary of State may settle such claims when the injury or death is caused by an officer, employee, or agent of the U.S. government, other than members and employees of the armed forces (31 U.S.C. § 3725). Settlement is limited to amounts not exceeding $1,500 in any one case. Negligence, wrongful acts, or acts within the scope of employment need not be proven.

(b) The Secretary of State may also pay tort claims in foreign countries arising out of U.S. government operations abroad. Settlement is limited to not more than $15,000. A foreign government must present such claims for damage to, or loss of, real or personal property of, or for personal injury to or death of, a national of that foreign country, 22 U.S.C. §§ 2669 and 2669-1. These claims may not be cognizable under any other U.S. statute or international agreement.

(c) The Secretary of State may pay tort claims arising out of Department of State operations in foreign countries. Payment is made in the manner authorized under the FTCA in 28 U.S.C. § 2672. There is no provision for bringing suit if a claim is denied, 22 U.S.C. §§ 2669 and 2669-1.

(d) Under the auspices of the Department of State, the International Boundary and Water Commission, United States and Mexico, may pay claims, not exceeding $1,000, for property damage arising from the activities of the government or its personnel in connection with any Commission project. Such claims may not be cognizable under the FTCA. They are payable from funds appropriated for the project giving rise to the loss (22 U.S.C. § 277e).

(e) The U.S. Constitution (Art. I, sec 9, clause 8) prohibits acceptance without consent of Congress of "any present, emolument, office, or title" from a foreign state by U.S. employees, including members of the armed forces and their families. The Department of State processes foreign government claims for return of gifts and decorations that it holds on deposit, 22 C.F.R. Part 3 , chapter I, except for Vietnamese decorations, which are governed by Pub. L. No. 89-257, passed October 15, 1965. Pub. L. 89-257 is uncodified. More information about Pub. L. No. 89-257 is available by visiting http://foxfall.com/fm-vca.htm .

(2) Department of Justice.

(a) Federal prisoners injured while engaged in work activities under the Federal Prison Industries Program are limited to the exclusive remedy provided by the fund such industries have established (18 U.S.C. § 4126); see also United States v. Demko, 385 U.S. 149 (1966). Those prisoners under the custody or control of the Army who have been discharged and are engaged in the Federal Prison Industries Program are also covered, as are their dependents. The Disciplinary Barracks, Fort Leavenworth, has not joined this program but it plans to do so shortly. Recovery is barred, however, if injury is sustained as a result of willful conduct, is not related to work assignment, or occurs while the claimant is away from the work location. Recovery may not exceed that permitted under the FECA. Claimants are entitled to procedural due process with limited judicial review. See Saladino v. Federal Prison Indus., 404 F. Supp. 1054 (D. Conn. 1975); Sturgeon v. Federal Prison Indus., 608 F.2 d 1153 (8th Cir. 1979).

(b) The Attorney General is authorized to settle and pay claims for no more than $1,000 for damage to, or loss of, personal property of federal penal and correctional institution employees incident to their employment. Neither negligence nor causation is required, but recovery is barred if the damage or loss results from the claimant's or an agent's contributory negligence (31 U.S.C. § 3722).

(c) Claims based on unjust convictions may be payable under 28 U.S.C. § 1495 and 28 U.S.C. § 2513 by the Court of Federal Claims or a District Court, 28 U.S.C. § 1346. Such claims must be based on an actual conviction and are limited to a total of $5,000.

(d) Owners of property seized under the Trading with the Enemy Act (50 U.S.C. app. § 9) are entitled to the exclusive remedy this Act provides for the payment of damages or the return of the property held by the Attorney General as custodian, provided the owners prove they were neither enemies nor allies of an enemy of the United States.

(e) Claims based on actions of the Director, Assistant Director, inspectors, or special agents of the FBI, which are not cognizable under the FTCA, may be compensable in a limited amount from agency appropriations.

(f) Claims arising out of operations of the Drug Enforcement Agency conducted in a foreign country may be settled in the manner authorized by the FTCA.

(g) Claims for death or disability of a public safety officer, including state and local officials, arising in the line of duty are payable by the Bureau of Justice Assistance, 42 U.S.C. §§ 3796-3796c-1.

(3) Department of the Treasury. Army disbursing officers are authorized to recertify checks that have been issued by the Army and later lost or stolen. However, not all federal agencies have this authority. An inquiry regarding a check issued by another agency should first be referred to that agency or, for cases in which it is known that such agency cannot recertify the check, to the U.S. Department of the Treasury, for processing through the Check Forgery Insurance Fund (31 U.S.C. § 3343, 31 C.F.R. §§ 235.1-235.6 ).

(4) Department of Agriculture. The Secretary of Agriculture is authorized to pay up to $2,500 for damage to private property caused by any federal employee, including Army personnel, in connection with the protection, administration, or improvement of national forests (16 U.S.C. § 574). Negligence is not a requirement. This remedy is available only for claims not cognizable under the FTCA.

(5) Department of the Interior.

(a) Claims for damage, loss, or destruction of horses, vehicles, and other equipment occurring while in the custody of the National Park Service may be settled by the Secretary of the Interior, if the National Park Service exercises such custody for fire-fighting, trail maintenance or other official business (16 U.S.C. § 17f). Such claims may not be cognizable under the FTCA and are payable from appropriations for the rental of such equipment.

(b) The Secretary of the Interior is authorized to settle and pay claims to owners of private property for damages resulting from government operations in the survey, construction, operation, or maintenance of tribal Native American irrigation projects. Such claims are payable from project funds but may not exceed five percent of total project funds available that year (25 U.S.C. § 388). A claim by an Indian tribe as an entity is within the exclusive jurisdiction of the Court of Federal Claims (28 U.S.C. § 1505).

(6) Department of Health and Human Services.

(a) Claims for injury and death caused by the administration of vaccines may be payable by the Court of Federal Claims under the National Vaccine Injury Compensation Program (42 U.S.C. §§ 300aa-1 through 300aa-6). A claimant dissatisfied with the Court of Federal Claims judgment may bring a civil suit for damages in a state or federal court. Such claims are also cognizable under the FTCA.

(b) Claims for injury or death arising from the acts or omissions of employees or contractors engaged in the performance of medical, surgical, dental or related services within the following entities: migrant health centers (42 U.S.C. § 254b); and community health centers (42 U.S.C. § 254c).

(7) Department of Veterans Affairs.

(a) Tort claims arising in foreign countries in connection with the Department of Veterans Affairs (DVA) operations abroad are authorized under 38 U.S.C. § 515. Administrative claims authority parallels that set forth in the FTCA, but judicial review is not available.

(b) Loss of personal effects sustained in a fire, earthquake or other natural disaster while stored in a DVA hospital or residence is covered under 38 U.S.C. § 1726.

(8) U.S. Information Agency. 22 U.S.C. § 1474 applies to tort claims that arise in foreign countries in connection with U.S. government information and educational exchange programs conducted abroad.

(9) Nuclear Regulatory Commission.

(a) Claims resulting from the detonation of a nuclear or non-nuclear explosive device in the course of conducting a Nuclear Regulatory Commission program are payable under 42 U.S.C. § 2207. This statute expressly covers acts or omissions of Army personnel engaged in such a program. Such claims, which may be brought for damage or injury from explosions or radiation, are based on causation; negligence need not be established. Although such claims are limited to not more than $5,000, the Commission may report claims in excess of that amount to Congress for consideration if they are meritorious and otherwise covered by this provision. Such claims are not payable if caused in whole or in part by the negligent or wrongful act of the claimant or the claimant's agents and employees. An action may also be brought under the FTCA unless the claim arises outside its geographic scope. See also 42 U.S.C. § 2210 and 10 C.F.R. §8.2 for information on indemnification agreements in claims against third parties held liable for nuclear incidents.

(b) The Nuclear Regulatory Commission is authorized to settle and pay claims for property damage or personal injury or death resulting from a nuclear incident involving the nuclear reactor of a U.S. warship (42 U.S.C. § 2211.3). Additionally, the President may authorize payment of claims from available contingency funds or certify them to Congress for appropriations. Such claims are not payable if they arise from combat or civil insurrection.

(10) National Aeronautics and Space Administration. The National Aeronautics and Space Administration (NASA) is authorized to pay claims arising out of the conduct of its functions that are not covered under the FTCA. See 42 U.S.C. § 2473(c)(13), 14 C.F.R. §§ 1261.300-1261.317 . The statute expressly covers the acts or omissions of Army personnel engaged in NASA programs. Such claims may be based on causation alone; negligence need not be shown. There is a ceiling of $25,000; claims in excess of that amount, however, may be reported to Congress for consideration if they are meritorious and otherwise covered by this provision.

(11) National Oceanic and Atmospheric Administration. The Secretary of Commerce is authorized to settle claims not to exceed $2,500 for property damage, personal injury or death arising from National Oceanic and Atmospheric Administration activities that are not cognizable under the FTCA (33 U.S.C. § 853).

(12) Peace Corps. The Peace Corps is authorized by 22 U.S.C. § 2509(b) to pay, in amounts not exceeding $20,000, claims of foreign nationals for property damage, personal injury, or death resulting from tortious acts committed abroad by Peace Corps employees or volunteers.

(13) United States Postal Service. Claims for property damage, personal injury or death resulting from U. S. Postal Service operations that are not cognizable under the FTCA are covered by 39 U.S.C. § 2603.

(14) Tennessee Valley Authority. Claims arising from the activities of the Tennessee Valley Authority are not cognizable under the FTCA but the Tennessee Valley Authority may settle and pay them in its capacity as a quasi-governmental corporation, 16 U.S.C. § 831c(b).

(15) Panama Canal Commission. Claims arising from the Panama Canal Commission's activities or the acts or omissions of its employees are not cognizable under the FTCA but may be paid by the Panama Canal Commission. The comparative negligence of Canal employees, the vessel master, crew, or passengers may be used to apportion liability. Such claims are subject to judicial review by the U.S. District Court for the Eastern District of Louisiana. See Panama Canal Act of 1979, 22 U.S.C. §§ 3601-3873 at §§ 3761 and 3771.

(16) American Battle Monuments Commission. Claims arising from the American Battle Monuments Commission's activities in foreign countries are payable under 36 U.S.C. § 2110 and processed under the FCA and AR 27-20, chapter 10 .

d. Claims related to Army service or employment.

(1) Claims based on Soldiers' personal affairs.

(a) Private indebtedness; see AR 600-15 .

(b) Nonsupport of dependents; see AR 608-99 . This includes court-ordered garnishment of pay for alimony and child support.

(c) Paternity claims; see AR 608-99.

(d) Claims for property willfully damaged or destroyed or wrongfully taken; see the Uniform Code of Military Justice (UCMJ) , Article 139, and AR 27-20, chapter 9 .

(e) Other complaints and allegations against Soldiers; see AR 600-20, paragraph 5-8 .

(2) Remission of indebtedness. DFAS processes claims by enlisted personnel for remission of indebtedness to the federal government under 10 U.S.C. § 4837. Remission of indebtedness is available to enlisted Army Soldiers while serving on active duty, inactive duty training or active duty for training. See AR 600-4 . The indebtedness of ARNG Soldiers, based on reports of survey, may be remitted under 32 U.S.C. § 710(c). See AR 600-4. Remission of indebtedness procedures are not authorized to effect offsets under Article 139, UCMJ (implemented in AR 27-20, chap 9), since the Soldier's debt under Article 139 is owed to the victim, not to the government.

(3) Meritorious Claims Act. See extract from 31 U.S.C. § 3702. The OMB is authorized to consider meritorious claims against the United States that are not otherwise subject to lawful adjustment. Relief under this law is discretionary and administered according to established equitable principles and the circumstances of the particular case. The OMB has delegated most claims settlement functions as set forth in subparas (a) , (b) , and (c) , below. In addition, subpara (d) , below sets forth a delegation of waiver authority by the Comptroller General. However, the Comptroller General has retained authority, under 31 U.S.C. § 3529, to issue decisions to disbursing or certifying officials and heads of agencies on matters involving the expenditure of appropriated funds not specifically involving the claims settlement and waiver functions set forth below.

(a) Settlement of claims for uniformed service members' pay, allowances, travel, transportation and survivor benefits, and carriers' claims for amounts set off from their charges for loss and damage, to the DOD, Office of Hearings and Appeals.

(b) Settlement of federal civilian employees claims for compensation and leave, to the Office of Personnel Management.

(c) Settlement of claims for civilian federal employees' travel, transportation and relocation allowances, and transportation carriers' requests for review of General Services Administration (GSA) audits of their bills, to the GSA Board of Contract Appeals.

(d) Authority to prescribe standards for and waive claims against government employees and members of the uniformed services and National Guard arising out of erroneous payments of pay and allowances and of travel, transportation and relocation benefits was transferred to the head of an agency with respect to legislative branch employees, or the Director of OMB with respect to any other federal employee, member of the uniformed services or the National Guard. OMB re-delegated this authority to the agency that made the erroneous payment.

(4) Claims by Reserve component personnel. Claims of Reserve component (U.S. active Reserve and ARNG) personnel arising pursuant to inactive duty training or active duty are discussed below. For purposes of this paragraph, active duty includes all federally funded full-time duty or training, such as annual training, active duty training, active duty special work, active duty other than for training and full-time training or ARNG duty ( all full-time National Guard duty under 32 U.S.C. §§ 316, 502, 503, 504, or 505).

(a) Claims for loss, damage, or destruction of personal property of Reserve component members incident to inactive duty training or active duty are payable under AR 27-20, chapter 11 , or if not payable thereunder, chapter 3 , the MCA, may apply.

(b) Claims for personal injury to, or death of, Reserve component members pursuant to inactive duty training are barred by the incident to service doctrine. The incident to service bar applies to inactive duty training only after the Soldier reports for duty and does not cover the Soldier's travel to or from duty by POV. The bar does not apply to POV travel to inactive duty training or two weeks training if the Soldier's travel is so authorized.

(c) Claims for payment or reimbursement of expenses for treatment of injury or disease at civilian medical facilities incurred by Reserve component members as a result of performing inactive duty training or active duty are processed by Army medical authorities pursuant to AR 40-400, chapter 3 . Generally, payment for civilian medical care is authorized only if the appropriate Army medical official approved it in advance or during a bona fide medical emergency. Reserve component members are expected to receive as much care at MTFs as possible.

(d) Claims for continuation of basic pay and allowances (such as incapacitation pay) brought by Reserve component members who are disabled by injury or disease in the line of active duty or inactive duty training are processed under regulations issued pursuant to 37 U.S.C. §§ 204(g) and (h). Such coverage includes in-line-of-duty travel to and from inactive duty training, even though the member is not on active duty.

(e) Claims for disability-retirement or separation with severance pay are processed under regulations implementing 10 U.S.C. §§ 1201 through 1206.

(f) Claims for pay and allowances due for periods of inactive duty training are processed by DFAS under DOD FMR, Vol. 7A, chapter 58 .

(g) Reserve component members who must be discharged due to a service-connected disability but who are not eligible for DA disability retirement may be eligible for DVA medical care, 38 U.S.C. chapter 17. Dependents of members who die as a result of service-connected injury or disease may be eligible for dependent indemnity compensation, 38 U.S.C. chapter 13.

(5) Claims by reserve officers' training corps cadets.

(a) Claims for injury to, or illness of, senior ROTC cadets during authorized, scheduled and supervised training or instruction, or while traveling to or from such training while on government transportation or on government orders, fall under FECA (see 5 U.S.C. § 8140). Such training or instruction may be conducted on or off campus and includes Basic Camp, Advanced Camp, and Cadet Professional Development Training (Airborne, Northern Warfare Training, Air Assault). Claims for death or permanent disability are submitted to the DVA.

(b) Claims for injury to, or death of, ROTC cadets with Reserve status are payable under FECA when they arise in the line of duty and while the claimant is attending, or traveling to or from, training or instruction described in subparaph (a) , above.

(6) Claims by applicants for enlistment or by inductees. The DVA processes all claims brought by applicants for enlistment or inductees for injury, disease, disability or death incurred enroute to, from, or while at the place of entry into active service, 38 U.S.C. § 106(b). The DVA's authority supersedes the Army's authority to consider a negligence claim based on the same injury or disease. However, the Army may deduct any benefits recovered or recoverable from the DVA. In addition, applicants and inductees are entitled to free medical care at Army facilities for such injury or disease; see AR 40-400 . The Selective Service may authorize reimbursement for expenses of emergency medical care obtained from civilian sources (50 U.S.C. app. § 461, 32 C.F.R. § 1659 ).

(7) Claims to upgrade discharges.

(a) If it is alleged that a discharge was inequitable or improperly executed, the ex-Soldier may apply to the Army Discharge Review Board to change, correct, or modify the discharge or dismissal under AR 15-180 . Such review does not apply to discharges or dismissals by general court-martial, nor may the applicant regain active status in the Army. However, an applicant who succeeds in upgrading a discharge may receive certain statutory benefits previously withheld because of the inferior discharge class.

(b) Soldiers or former Soldiers may request correction or adjustment of their military records from the Army Board for Correction of Military Records (10 U.S.C. § 1552, AR 15-185 ). The Board may grant any relief it deems just and proper, including reinstatement of active service with back pay. In such a case, DFAS processes the payment pursuant to AR 37-104-4, chapter 20 , with Army claims budget funds.

(8) Claims for pay, allowances or other demands processed by Defense Financial Accounting Service. Defense Financial Accounting Service (DFAS) routinely handles many types of monetary demands that come through finance and accounting channels:

(a) Soldiers' and former Soldiers' claims for adjustments in pay or allowances after separation or for prior periods of service.

(b) Claims for lump-sum accrued leave.

(c) Claims for uniform allowances.

(d) Claims for travel and transportation allowances. ( See DFAS-IN 37-1 , chap 10.) These may include reimbursement of excess shipping or storage expenses that the Soldier has paid on a government shipment or that arise when a Soldier, entitled to government shipment, instead ships the property at own expense. Postage costs for mail shipments are excluded. Such claims should first be presented to the installation transportation office for consideration.

(e) Claims for interest on savings deposits are payable under AR 27-20, paragraph 11-5g . Otherwise, claims for interest should be forwarded to DFAS.

(f) Claims for repayment of amounts collected erroneously from military and civilian personnel and deposited in the U.S. Treasury are processed through DFAS. Refunds, if appropriate, are paid from available Army claims budget funds.

(g) Claims related to official business travel are paid by DFAS under authority of the JFTRs and the DOD FMR. Such claims may include bridge, ferry, tunnel, or highway tolls; parking fees; local commercial transportation taken in connection with official business; emergency roadside service; telephone and telegraph service; clerical support hired or rented while on TDY; and registration fees incident to attendance at meetings of private organizations such as technical, scientific, or professional associations.

(h) Claims for proceeds of undelivered checks issued by DFAS, see DFAS-IN 37-1 and DOD FMR Vol. 5, chapter 8 .

(i) Claims for recertification of lost, stolen, or mutilated checks issued by DFAS, see DFAS-IN 37-1 and DOD FMR Vol. 5, chapter 8.

(j) Claims arising out of forged DFAS checks, see DFAS-IN 37-1 and DOD FMR Vol. 5, chapter 8.

(k) Claims for conversion of Military Payment Certificates or for the command's refusal to convert such certificates, see DFAS-IN 37-1 and DOD FMR Vol. 5, chapter 8.

(l) Claims for reimbursement for monetary losses incurred or anticipated by a Soldier or civilian employee from the sale of a residence or from a residence mortgage foreclosure incident to closure of the military installation at which the claimant is stationed are cognizable under 42 U.S.C. § 3374. At the installation level, the appropriate military or civilian personnel officer is generally responsible for assisting applicants and forwarding completed applications with supporting documents to the appropriate COE district for processing. DFAS pays the claims from funds allocated under the Homeowners' Assistance Program.

(m) Claims for reimbursement of closing costs associated with the sale or purchase of a residence incurred by an Army civilian employee who is authorized travel under 5 U.S.C. § 5724 pursuant to a permanent change of duty station are cognizable under 5 U.S.C. § 5724a. Since such costs often arise incident to base closing, departmental directives published at the time of the base closing typically control and set forth filing and payment procedures. Check any local directives published when the base closes to determine the correct procedure and where to submit the claim-usually the civilian personnel or industrial relations office. DFAS pays these claims from funds specifically set aside for their administration.

(n) Claims for overdraft charges caused by government error which are incurred at a bank, credit union or savings and loan institution where the Soldier's or employee' s sure-pay account is located are payable by DFAS (10 U.S.C. § 1053 and 10 U.S.C. § 1594).

(9) Inconvenience claims pursuant to household goods shipments. Claims for inconvenience due to a carrier's failure to meet a scheduled or preferred delivery date and for claimant's personal expenses incurred above normal living expenses that are not covered by AR 27-20, chapter 11 , or any other regulation or statute, may in certain cases be paid by the responsible carrier. Generally, however, the dislocation allowance granted on a change of duty station is intended to cover those personal expenses incurred above normal living expenses.

(10) General average claims. "General average," a principle of maritime law that has been adopted by all civilized nations, is illustrated in its simplest form by Rhodian language: "If the goods of an owner are thrown overboard to lighten the ship, the loss occasioned for benefit of all must be made good by the contributions of all." Modern maritime situations are considerably more complex but the underlying principle remains the same: the sacrifice of one owner's cargo to save the ship or other owners' cargo is shared by all on a ratable basis.

(a) Military Sealift Command (MSC) has exclusive responsibility for the investigation, determination of liability and payment of general average contribution claims for all DOD cargo and DA-sponsored baggage, household goods and personal effects shipments (including POVs and professional books, papers and equipment).

(b) Send general average contribution claims to the MSC area or sub-area commander whose contracting officer chartered the vessel or booked the cargo for shipment or in whose area or sub-area the shipment originated. If the proper MSC is not known, send the claim to: Military Sealift Command, 914 Charles Morris Court, SE Bldg. 210 Washington, DC 20398-5540.

(11) Claims involving government life insurance.

(a) If a potential beneficiary of a life insurance policy issued to a Soldier of the armed services under National Service Life Insurance, U.S. Government Life Insurance, or yearly renewable term insurance disagrees with the distribution of the policy proceeds, the aggrieved party may bring suit against the United States in the appropriate district court (38 U.S.C. § 1984).

(b) Additionally, federal district courts have original jurisdiction over actions founded on contract for Servicemen's Group Life Insurance (38 U.S.C. § 1975). They exercise original jurisdiction concurrently with the Court of Federal Claims on actions on contracts for life insurance under 5 U.S.C. chapter 87 and for health insurance under 5 U.S.C. chapter 89. Actions based on negligence of Army personnel in administering the foregoing programs are covered, Shannon v. United States, 417 F.2 d 256 (5th Cir. 1969); Barnes v. United States, 307 F.2 d 655 (D.C. Cir. 1962).

(12) Claims by foreign national employees for loss of salary due to imprisonment. Process under 22 U.S.C. § 3970 claims for loss of salary and other benefits sustained by foreign national employees of U.S. governmental agencies incident to their imprisonment by a foreign government because of their employment by the United States.

(13) Claims for personal effects. Process claims for personal effects brought on behalf of deceased and missing personnel under 10 U.S.C. § 4712 and AR 638-2, part 2 ; claims for lost and abandoned property of absent-without-leave (AWOL) Soldiers and deserters under DA Pam 600-8; and claims for property of prisoners under AR 190-47, chapter 10, section II . Claims by deceased or missing personnel's next of kin may be payable under AR 27-20, chapter 11 , if efforts to locate the property fail.

(14) Claims for property seized as evidence and for lost or abandoned property.

(a) Claims for return of property seized as evidence by military police, CID or military prosecutors should be addressed to whoever seized the property. If such property cannot be returned, a property loss claim can be filed under the PCA if the claimant is a service member or otherwise an eligible claimant. If the claimant is not a proper claimant under the PCA, a claim may be filed under the FTCA or, if the loss occurred in a foreign country, under the MCA. Such claims may be subject to the exclusion for clams for the detention of goods or merchandise by any customs or other law enforcement officer. See AR 27-20, paragraph 2-39d(4) .

(b) Claims for lost or abandoned property can be processed under 10 U.S.C. § 2575, DFAS- IN 37-1 , and DOD 4160.21-M . If their procedures were not followed, a property loss claim may be filed under the PCA, subject to eligibility, the FTCA or, if the loss occurred in a foreign country, under the MCA.

(15) Claims for property lost while in possession of bonded Army personnel. For prisoners' or patients' claims for lost property, see the regulations applicable to military and civilian personnel engaged in disbursal, logistical or postal operations, or employed at stockades, prisons, hospitals and other places to administer prisoners' and patients' personal property and funds. For NAFI personnel, see AR 215-1 and AR 60-20 ; also contact the particular installation or activity concerned to find out if bonding has been required locally.

e. Claims arising from the provision of supplies, services, and vehicles to the Army.

(1) Claims based on irregular procurement of supplies and services:

(a) The Army occasionally acquires property, supplies, perishables or services for its use or consumption through other than prescribed procurement procedures. For example, during a deployment or maneuver, consensual acquisition of such property or services is not susceptible to contractual adjustments such as amendment without consideration, correction of mistakes, and formalization of informal commitments. Process these informal procurements under 50 U.S.C. § 1431, and FAR, part 50 . Formalize an informal commitment only if normal procurement procedures were impractical at the time the commitment was made to the vendor. Such requests for compensation must be submitted through procurement channels to the appropriate MACOM. This provision may be effective only during a declared national emergency. Claims for noncontractual acquisitions of supplies or perishables may be processed under FAR, part 50.

(b) Claims for personal services rendered at the request of a Soldier or civilian employee may be cognizable under the Meritorious Claims Act, see subparagraph b(3) , above.

(2) Claims for medical care. Claims for civilian medical care to Soldiers in emergencies are payable by TRICARE as authorized by AR 40-400, chapter 3 . Refer claims for such services furnished to dependents of active duty or retired personnel and dependents of deceased active duty or retired personnel to the appropriate TRICARE fiscal administrator or overseas commander at one of the following address shown below: Director, TRICARE 16401 East Centretech Parkway Aurora, Colorado 80011-9043 Commercial: 303-676-3561 Director, TRICARE Europe Support Office Unit 10310 APO, AE 09094-0310.

(3) Claims for counsel (attorney) fees. Claims for counsel fees, bail and expenses are limited to cases in foreign tribunals and are processed under 10 U.S.C. § 1037 and AR 27-50 .

(4) Rewards for recovery of lost Army property. If someone recovers lost Army property pursuant to an express invitation made by the authorized representative of the Army for the recovery of such property, see AR 735-5, chapter 9 , for instructions on how to obtain the reward.

(5) Payments for apprehension of deserters, prisoners, and absent-without-leave Soldiers. Payment for apprehension of deserters, prisoners, and AWOL Soldiers is authorized when the prisoner is delivered. Actual expenses may be paid in lieu of reward, for example, travel, meals, phone calls, and property damage caused by the prisoner. See AR 190-9, chapter 6 .

(6) Salvage claims. Process under AR 27-20, chapter 8 claims for towing and salvage service rendered to a vessel of or in the service of the Army.

(7) Claims for assistance given to U.S. prisoners of war. Claims for the provision of such assistance, whether given voluntarily or pursuant to a contractual arrangement, may be considered in accordance with the guidance in subparagraph e(1) , above or under the Meritorious Claims Act.

f. Claims against the Army by federal agencies.

(1) District of Columbia. An agency of the District of Columbia is not considered a federal agency for the purpose of filing a claim (36 Comp. Gen. 457 (1956)), and thus is not barred from claiming under AR 27-20 .

(2) Interdepartmental waiver. Tort or tort-type claims for damage to the property of one U.S. department or agency are not asserted against another U.S. department or agency, regardless of whether an agency is fully supported from appropriated funds or partly supported by revenue-producing activities, a government corporation, or a non-appropriated fund (NAF) activity, 25 Comp. Gen. 49 (1945). This interdepartmental waiver is predicated on the doctrine that property belonging to the government is not owned by any department of the government. The government does not reimburse itself for the loss of its own property except where the law specifically provides. Forward to the Commander USARCS claims by other federal agencies and by organizations within the Army such as NAFIs or AAFES for property loss or damage, or for reimbursement of amounts paid as compensation or other benefits to injured persons or on behalf of deceased persons.

(3) General Services Administration vehicle damage claims. These claims are, in effect, charges by GSA to cover "elements of costs" and "increments for replacement costs." If arising from damage caused by an Army Soldier or employee, they are payable out of operational and maintenance funds, not as tort claims but as expenses incurred (41 Comp. Gen. 199 (1961); 40 U.S.C. §605. If the GSA vehicle was within the custody and control of the Army or DOD and a Soldier or civilian employee caused the damage through negligence, conduct a report of survey under AR 735-5 . If the GSA vehicle was damaged through the negligence of someone other than a Soldier or civilian employee, send the file to the appropriate GSA regional counsel. For GSA vehicles over which the DOD or DA does not exercise custody or control, damage caused by the negligence of a Soldier, DOD or DA employee, or someone operating another vehicle is subject to the interdepartmental waiver rule. When the Soldier or employee operating a GSA vehicle negligently causes damage jointly with an employee of another federal agency, the interdepartmental waiver rule precludes the Army from seeking indemnification for what it must pay to GSA.

(4) Railroad Retirement Board claims. The Railroad Retirement Board is subrogated under the Railroad Unemployment Insurance Act to railroad employees injured by a federal government employee's negligence. As subrogee, the Board may be reimbursed from appropriations of the responsible federal agency for the amount of sick benefits the employee receives from the Railroad Unemployment Insurance Account (29 Comp. Gen. 470 (1950)). See 45 U.S.C. § 362(o). Process the Railroad Retirement Board's subrogation claims against the United States the same way any other cognizable subrogation claim is processed.

g. Claims against the Army by state or local governments.

(1) Local governments. Local governments within the United States may assert claims against the Army. The same principle generally applies to local foreign governments, except when counter to treaty provisions such as those found in Article VIII, NATO SOFA. However, AR 27-20 bars a state's claims for damage caused by activities of its own National Guard during federally funded training duty or service.

(2) Access and replacement road claims.

(a) Claims for road repairs are restricted by AR 55-80 to those occasioned by large-scale maneuvers and exercises, and surveys must be made before and after such activities. Further, regulations under the Defense Access Road Program preclude retroactive payments for improvements. Thus, damage that has already occurred should be paid under AR 27-20, chapters 3 , 4 , 5 , 6 , 7 , or 10 , as appropriate, except when a state is claiming for damage caused by its own National Guard. Process anticipated (future) damage under the Highways for National Defense Program (23 U.S.C. § 210 and AR 55-80) pursuant to AR 55-80.

(b) Damage caused to highways, railways, or utilities by the operation of any dam or reservoir project under the Army's control may be corrected by the use of funds for the project's construction, maintenance or operation. Such funds may be used to repair, relocate, restore or protect highways, railways or utilities. This provision does not apply, however, to highways, railways, and utilities provided for by the Army unless the damage exceeds that for which provision was previously made (33 U.S.C. § 701q).

(3) Claims for local fire department services. Claims for local fire department services used to extinguish fires started by Army operations (through weapons fire or negligence, for example) are not payable. As there is no loss of or damage to property, such claims are not considered to merit money damages, Idaho ex. rel. Trombley v. U.S. Dept. of Army, 666 F.2 d 444 (9th Cir. 1982), cert. den. 459 U.S. 823 (1982). However, when the fire occurs on property under federal jurisdiction, FEMA may authorize payment under 15 U.S.C. § 2210. Contact the AAO for guidance on payment procedures. If the local fire department has been called in to assist and such assistance is not covered by a mutual support agreement, the claim may be processed on a small purchase basis under procurement procedures. See FAR, part 13 .

(4) Claims for taxes. Claims for taxes by state and local governments that may affect the Army include those:

(a) Against procurement contractors. See FAR subpart 29.3 .

(b) Against lessee's interest in Wherry Act housing. See AR 210-47 .

(c) Against exchange sales and services. See AR 60-20 , paragraphs 6-2 through 6-4.

(d) Arising out of purchase or sale of alcoholic beverages. See AR 60-20, paragraph 2-16 and AR 215-1, paragraph 7-23 .

(e) Against NAF fund activities. See AR 215-1, paragraph 3-13 .

h. Other remedies.

(1) Tucker Act. ( See 28 U.S.C. § 1346). Claims filed under the Tucker Act include those founded upon the U.S. Constitution (a Fifth Amendment taking of property), an Act of Congress, any regulation of a federal executive department, any express or implied contract with the United States or those seeking liquidated or unliquidated damages in cases not sounding in tort. However, the Tucker Act itself is not a waiver of sovereign immunity. Separate authority must provide the basis for jurisdiction. Tucker Act plaintiffs must file in the Court of Federal Claims in any amount, or for amounts not over $10,000 in a U.S. District Court, in which original jurisdiction is vested concurrently with the Court of Federal Claims., 28 U.S.C. § 1346. Claimants excluded from recovery under the FTCA by 28 U.S.C. § 2680 or by Army regulations may invoke Tucker Act jurisdiction when suing on an express or implied-in-fact contract, Burtt v. United States, 176 Ct. Cl. 310 (1966).

(2) Private relief legislation The scope and nature of this remedy is within Congress' discretion, an authority stemming from the constitutional provisions empowering it to pay the debts of the United States (U.S. Const., Art. I, sec. 8) and to honor petitions for the redress of grievances (U.S. Const., Amendment I). This category includes debts or claims that rest on a merely equitable or honorary obligation and would not be recoverable in a court of law if brought against an individual, United States v. Realty Co., 163 U.S. 427 (1896). There is no established procedure under which the DA sponsors private relief legislation; usually a claimant contacts a member of Congress directly. DA claims personnel will remain neutral in all private relief matters. They should make no statements or predictions about what headquarters DA will do after the member has introduced a Bill.

(3) Privacy Act. 5 U.S.C. § 522a, including Right to Financial Privacy Act, 12 U.S.C. §§ 3401-3422. This act permits suits against the U.S. for invasion of privacy in a variety of contexts. A Privacy Act suit does not preclude a common law suit under the FTCA.

(4) Americans with Disabilities Act (ADA). 42 U.S.C. §§ 12101-12213. The ADA does not apply to federal agencies nor does failure to meet its standards provide a basis for suit under the FTCA.

(5) Alien Tort Claims Act. 28 U.S.C. § 1350. Provides a judicial remedy for persons in foreign countries for acts or omissions by U.S. employees or others.

(6) Foreign Sovereign Immunities Act. 28 U.S.C. §§ 1330, 1332, 1391, 1441, and 1602-1611. Permits recovery in U.S. federal courts by persons, including U.S. citizens, who were tortured or taken hostage by a foreign sovereign.

(7) Federal Rehabilitation Act. 29 U.S.C. §§ 701-797b and the Age Discrimination Act, 29 U.S.C. § 621. Both acts are self contained. Recovery of benefits thereunder does not permit a claim for negligent infliction of emotional distress under the FTCA.

(8) Quiet Title Act. 28 U.S.C. § 2409a. This act applies to actions in Federal District Court in ejectment for possession of property.

(9) Veterans Judicial Review Act. 38 U.S.C. § 511. Preempts the FTCA in actions for reduction in veterans benefits.

(10) Miller Act. 40 U.S.C. § 3131. Requires U.S. contractors to post bonds to protect payment of subcontractors.

(11) Civil Rights Act, Title VII. 42 U.S.C. §§ 2000e-3 - 2000e-7. Remedy for workplace harassment.

(12) Prison Litigation Reform Act of 1996. 42 U.S.C. § 1997e. Remedy for prisoners in addition to the FTCA.

(13) Resource Conservation and Recovery Act. 42 U.S.C. §§ 6961-6965. Covers remediation costs not recoverable under the FTCA.

Section IV
Investigative Methods and Techniques

2-18. Introduction

This section provides guidance for unit claims officers, ACOs and CPOs responsible for conducting tort claims investigations. The investigation is the most critical part of the administrative claims process. Its purpose is to learn, gather and preserve the facts as quickly and completely as possible. Facts are best collected and preserved while memories are fresh, witnesses are available, and physical evidence is unchanged. A well-developed investigation is essential in determining what law applies and is invaluable in negotiations. The elements of an investigation include identifying and interviewing of witnesses, identifying and preserving physical evidence, researching the law and procedural defenses, and using of experts, consultants and appraisers.

2-19. Role of claims officers and outside agencies

a. Unit claims officers. Unit claims officers are essential to the claims investigation. Paragraph 2-2 explains their relationship to the ACO, CPO, or USARCS.

(1) The unit claims officer, who usually is a member of the unit generating the alleged incident, is privy to crucial facts and information (such as the unit operating procedures).

(2) An ACO or CPO is responsible for guiding the claims officer throughout the latter's investigation. The unit claims officer should not hesitate to contact the ACO or CPO for assistance at any time during the investigation.

(3) The unit claims officer's investigation is limited to determining the facts and circumstances of the incident and describing the injuries of all participants. The unit claims officer's investigative report should not contain a conclusion as to liability and damages. The ACO or CPO will use the facts gathered during this investigation to determine liability and assess damages.

(4) While the unit claims officer usually prepares a report of investigation on DA 1208 (Report of Claims Officer) or SF 91 (Motor Vehicle Accident Report), this is within the ACO or CPO's discretion, since it may be more helpful if the report is prepared in a different format.

b. When applicable, the unit claims officer's report should include the following attachments:

(1) MP, CID, and state or local police accident reports.

(2) Report of survey on the government vehicle, with all attachments, regarding whether or not the government driver is pecuniarily liable. Attach appeals and reconsiderations when available. An investigation should not be delayed, however, pending final action on a report of survey.

(3) Line-of-duty investigation, regarding whether or not the government driver's injury was determined to be in the line of duty.

(4) SF Form 91 (Motor Vehicle Accident Report), completed by the government driver.

(5) Scope of employment information, including the supervisor's or commander's certificate (sample format posted on the USARCS Web site at "Claims Resources," II, a, no. 22).

(6) Incident scene diagram and photos.

(7) Interview with government tortfeasor and all eyewitnesses and, where indicated, the police investigator.

(8) Results of any civilian trial or court-martial or other adverse action taken against Army personnel.

(9) Releasable portions of the safety investigation.

(10) AR 15-6 investigation.

c. When the ACO or CPO may conduct all or part of the investigation. In most cases of death or serious injury, the ACO or CPO will inform the unit claims officer what information, if any, is needed. The ACO or CPO should explain the reason for this decision and keep the unit claims officer informed about the investigation's progress so the latter may furnish additional assistance.

d. Events that require coordination with the AAO. The AAO is responsible for technical supervision of the local claims investigation when an incident occurs that may result in the filing of claims that are reportable to USARCS or otherwise within USARCS' settlement authority. Accordingly, when the ACO or CPO learns of an incident that may result in a filing of a claim within USARCS' authority, or when a claim within USARCS' authority is filed, it should contact the AAO by telephone immediately and follow up with a written notice of the incident or claim. Close telephone and written contact on all claims investigated in the field is essential. Note that mirror file procedures apply to potential claims. See AR 27-20, paragraph 2-1c .

e. Coordinating claim investigations with other investigations. Although both civilian and military authorities may investigate an incident, the claims investigation pursues an independent inquiry into civil liability under state law. Follow this general guidance on claims investigation when other investigations are proceeding:

(1) Determine what other entities are investigating and why they are doing so. How useful their investigations will be depends on several factors beside the investigator's skill. For example, a report of survey is limited in purpose to determining whether a Soldier or an Army employee is financially liable for damage to government property. The survey may help in developing the facts surrounding liability, but it will probably be of little help in assessing comparative negligence or whether such defenses as last clear chance apply.

(2) Contact the investigating agency early and discuss the scope of both your and its investigations. Obtain copies of the agency's report and, if possible, advance copies of statements they take even if the report is not final. Include all other investigations in the claims report, tabbing them as enclosures. Always obtain final copies of other investigations.

2-20. Identification of witnesses

A witness is anyone who has personal knowledge of an incident by virtue of being at or near the scene at the time it occurred or shortly thereafter. Such witnesses may have observed the incident or its results.

a. Eyewitnesses. There is no substitute for an eyewitness. This person's knowledge of the incident comes from actually seeing or hearing the incident take place. An eyewitness version of the events leading up to the incident is often the deciding factor in determining liability. This is especially true if the witness is disinterested and impartial. Accordingly, it is imperative that all investigations include an exhaustive search for eyewitnesses.

b. Locating eyewitnesses. Any search for eyewitnesses should begin with a review of all available accident or incident reports. Most provide witnesses' names, addresses and telephone numbers. Sometimes, however, the authors of such reports do not list the names of all the witnesses they know of; this is especially true of police officers. Be sure to question police officers and other investigators to determine whether they know of any witnesses not mentioned in their reports. Also ask the claimant, claimant's attorney, all witnesses and any government employee(s) involved in the incident if they know of anyone else who witnessed the incident. Search for eyewitnesses by visiting homes and businesses located near the scene of an incident. A representative of the ACO or CPO should canvass door-to-door asking whether anyone saw or has information about the accident. House-to-house inquiry often turns up eyewitnesses who would not have been found otherwise.

c. Other witnesses. Locate other witnesses using the same methods. Although their statements may not be as compelling as those of eyewitnesses, do not underestimate their value; carefully interview these witnesses, particularly as to any statements or exclamations the injured parties made at the time. Persons who did not see the incident take place but have personal knowledge of it include —

(1) Those who were at the scene of the incident but were looking away when it occurred.

(2) Those who arrived at the incident scene shortly after it occurred, such as ambulance or medical personnel.

(3) Those who have any personal knowledge of the incident's cause.

2-21. Identification and preservation of evidence

a. Physical evidence. Physical evidence must be preserved for analysis by Army experts, inspection by the claimant and use in future litigation. Subsequent paragraphs discuss in detail the types of physical evidence that may be pertinent to various types of claims. But generally, the ACO or CPO is responsible for storing physical evidence in a secure location. If necessary, claims personnel should take possession of evidence and safeguard it. Here are areas in which problems may arise:

(1) Evidence in the possession of the criminal investigation division or military police. The CID and MP evidence custodians are responsible for securing evidence in an evidence room to safeguard it for use in criminal prosecution. After it is used, the evidence is released to the owner or destroyed. The trial counsel responsible for the criminal prosecution or the Chief of Military Justice may permit release of the evidence. To avoid improper release, inform both the evidence custodian and the criminal law or military justice section that they may not release evidence without the ACO or CPO's concurrence.

(2) Army aircraft and vehicles involved in accidents. Prompt action to secure and preserve physical evidence is essential. The unit or organization responsible for the vehicle will usually want to repair or dispose of it. However, it is vital to preserve the evidence or create acceptable secondary evidence before the aircraft or vehicle is repaired or lost through salvage. Ideally, the part or portion that allegedly contributed to the accident should be preserved for expert analysis. For example, if faulty brakes or a defective tire allegedly caused a vehicle accident, they should be inspected and preserved until the AAO agrees that their preservation is no longer necessary.

(a) Damaged vehicles or aircraft. Photograph the damage and obtain a copy of the repair facility's estimated cost. Again, if equipment failure is a suspected cause of the accident, the involved part must be inspected and preserved. Where indicated, arrange examination of the aircraft by the Army Teardown Facility, Corpus Christi Army Depot, Texas, or of the motor vehicle by the Combat Readiness Center, Fort Rucker, Alabama.

(b) Destroyed vehicles. Destroyed vehicles must be preserved until their evidentiary value is ended. A unit will usually try to turn in the vehicle as surplus as soon as possible because it cannot requisition a replacement vehicle as long as the original is carried on the property book. Since serious accidents may require reconstruction or tear-down analysis, the vehicle should be preserved as long as possible. Coordinate with the director of logistics or the installation property book officer to prevent the vehicle's loss.

(3) Property in the possession of investigating officers. Always contact investigating officers or boards that have possession of physical evidence and ask them how they plan to dispose of it. Ask the officer or board to coordinate with the ACO or CPO before destroying or otherwise disposing of the evidence.

(4) Testing of physical evidence. Document the nature, state and condition of the evidence, including any changes or modifications made by the U.S. Army since the object was originally procured. Obtain all maintenance records. Notify the claimant or potential claimant, the manufacturer and supplier of the proposed test of any change likely to occur as a result of the test. Invite all interested parties including the manufacturer, supplier and the claimant or potential claimant to participate and witness the test but retain sole possession of the evidence even though one or all of the interested parties initiated the request for testing. Obtain an examiner who has no interest in the outcome of the test. If another interested party wishes to participate in the choice of an examiner, either agree on a mutual choice or develop a plan where both examiners may participate. Document each step of the test to include any disassembly or destruction. Any component not returned to service must be preserved in an identifiable state. Examples are medical evidence such as laboratory slides, equipment used during an operation, respirators, and electrical equipment.

b. Documentary evidence. The type of documentary evidence that may be available will vary according to the type of claim, for example, medical malpractice, motor vehicle accident or dram shop action. Subsequent paragraphs, discussing investigative techniques unique to specific types of claims, address what documentary evidence should be collected and preserved. As always, time is of the essence, as records tend to become less and less accessible with the passage of time.

2-22. Researching the law and procedural defenses

A proper claims investigation requires a thorough inquiry into procedural defenses (such as subject matter jurisdiction) as well as liability and damages. Before initiating an investigation, it is essential to form a complete understanding of the law relevant to the claim. The ACOs and CPOs are responsible for instructing claims investigators on the relevant legal issues. Only if approved by the AAO can the claims investigation be limited in scope.

a. Procedural defenses.

(1) Claims barred by the incident to service doctrine. Review paragraph 2-37 . Investigate the facts establishing the defense. For example, if a Soldier is injured in an automobile accident, on or off-post, a finding that the injuries were incurred incident to service requires more support than the fact that an active duty Soldier claims for an apparent injury. It is crucial to know whether a Soldier is on an ordinary leave status. This limitation also applies to government employees injured or killed in the scope of employment. In both instances, obtain the personnel file as well as all documents pertaining to disability benefits.

(2) Claims barred by the statute of limitations. If the statute of limitations obviously applies, investigate only those facts pertaining to the defense. When it is questionable, investigate the merits of the claim. Always investigate all facets of a medical malpractice claim when the statute of limitations is an issue.

(3) Claims where there is obviously no liability. Occasionally a claim under AR 27-20 is not stated or the facts, as presented, do not support liability. In these cases, the claims investigator has two goals: to investigate liability thoroughly and to deter a suit by the claimant. Once the first goal is accomplished, discuss the claim with the claimant's attorney, disclosing the facts you have discovered and your reasons for believing the claim should be denied. This approach may deter suit because the claimant's attorney has the facts needed to evaluate liability. It also avoids the pitfall of needlessly requesting detailed damages information, such as physician's statements or medical evaluations, where there is obviously no liability.

b. Applicable law. Knowledge of the law applicable to the claim is essential to a proper investigation. Legal research starts when the claim is first investigated so that legal issues are addressed during its course. Use the approach outlined below to assist in legal research and claims investigation.

(1) Gather the facts available at the time the incident is reported to the claims office or the claim is filed. Collect and analyze all reports, tangible evidence, and site visit memos before beginning in-depth interviews or investigation. Know what others before you have done. Learn who has investigated and make personal contact (by telephone, if possible), asking for copies of their reports. In many cases, you will have to press for information. Do not hesitate to insist that others provide you with copies of their investigations immediately. This is especially important in criminal investigations. Carefully coordinate with criminal investigators to avoid conflicts with their pending investigations. Air crash investigations require similar coordination. However, request the air crash safety investigator to conduct a collateral investigation as the safety investigation cannot be released for claims purposes.

(2) Start legal research immediately. Do not rely on what you learned in law school or from past cases. Take time to refresh your knowledge. Study the law of the state where the claim arose and keep an outline of the issues presented. Keep this research in a separate part of the investigation file.

c. Liability. Evaluate liability issues in light of the proof available and avoid prematurely assuming a defensive position. Remember, in investigating claims you represent the Army, not the local installation, the command or the tortfeasor. Learn the claim's strengths and weaknesses and carefully evaluate the interests of witnesses and others involved in the incident or its investigation.

d. Damages. Always think of damages issues when interviewing witnesses. For example, when interviewing a police officer about a traffic accident, always ask whether vehicle occupants or pedestrians were injured or killed. The exact time of death is almost always an essential fact. Do not assume that the report contains everything. However, analyzing the strength of a claim solely in terms of potential damages is a mistake. A claim does not have settlement value simply because the damages are high.

2-23. Interviewing witnesses, claimants, and tortfeasors

a. General procedures.

(1) Key witnesses should be interviewed, even if they have given statements to other investigators. Witnesses often give claims investigators statements that differ from the version they give to police or other investigators. Personal interviews also allow them to clarify or expand on their previous interviews and let the investigator observe and form impressions about the witnesses.

(2) Procedures and techniques for interviewing, and pre and post interviewing actions, are similar for all types of claims. Claimant interviewing is covered in b of this paragraph. Witness interviewing techniques and techniques specific to interviewing potential or actual tortfeasors are discussed in paragraph 2-34 in the context of a medical malpractice investigation; however, the same general procedures can be applied in any type of claim.

(3) Before interviewing a witness, try to obtain copies of all of the prior statements made by the witness and review them carefully.

(4) Claims personnel conduct witness interviews orally and informally. The claims personnel conducting the interview will prepare an MFR of the interview. Put the interviewer's observations and impressions relevant to assessing the witness credibility in a separate memorandum, which will not be released to the claimant's attorney. Ask a witness to review and correct but not to sign the notes or memorandum; signing could make them discoverable. This method is designed to ensure that the investigation represents privileged attorney work product. It also speeds the investigation.

(5) Informal claimant interviews are indispensable to a fair evaluation. Such interviews are not often sought or permitted outside the government and, in fact, are not part of most federal agencies' typical administrative claim process. If the claimant's representative objects to an interview, offer to exchange information as an inducement. When this fails, request written interrogatories, even though they are not as satisfactory as a personal interview. Inform the claimant that refusal to submit to an interview or answer interrogatories will result in an evaluation based on only the information contained in the file.

(6) Do not obtain a written signed statement from the witness.

(7) Do not use a stenographer, tape recorder, or other means to create a verbatim statement.

(8) Do not obtain sworn statements.

(9) Requests by claimants or their attorneys for discovery of witnesses who are Soldiers or Federal employees will be met with the release of MFRs of interviews if —

(a) The ACO or CPO determines that their release will help in settling the claim.

(b) The claimant agrees to cooperate in a general exchange of information.

(10) If the claimant or the claimant's attorney asks to interview federal witnesses, apply the following conditions:

(a) The claimant should explain why the claims memoranda or statements obtained in other investigations are inadequate.

(b) The claimant must agree to allow the United States to interview informally the claimant and other witnesses made available at the claimant's behest.

(c) The interviews may not be taped or otherwise recorded.

(d) A representative of the ACO or CPO must be present at the interview.

(11) Avoid depositions. Report all requests for depositions to the AAO immediately. If a claimant makes such a request to a court while the administrative claim is pending, resist the request by informing the appropriate U.S. Attorney of it and of the policies of both the Army and the Torts Branch, DOJ, not to grant such a deposition.

(12) The AAO and the DOJ must concur in any decision permitting a Soldier or federal employee witness to be deposed. A common example in which a deposition might be appropriate is the case of a party whose injury severely shortens normal life expectancy. Transfer of a witness to another area or country is not a sufficient basis for taking sworn recorded testimony.

b. Claimant interview. The claimant interview is a crucial part of the investigation. Use the Claimant Interview Checklist posted on the USARCS Web site as a guide. See the USARCS Web site at "Claims Resources," II, a, no. 5. Plan the timing of this interview wisely, considering several factors:

(1) Claimant's situation. What is the claimant's situation? If the claimant is terminally ill, moving away, or growing confused, complete the investigation quickly. Often, investigators who expect to interview claimants when their own schedules allow overlook such obstacles, only to find that the claimant is not available. Thus, one of the first steps in any investigation is finding out as much as possible about the claimant. The typical interview takes time. Make sure that the claimant's counsel understands that. Inform counsel of the estimated number of hours needed for the interview.

(2) Preliminary witness interviews. What other witnesses must be interviewed before the claimant is interviewed? Will they be available?

(3) Claimant representation. If the claimant is represented, it may be difficult to obtain an interview and the attorney will probably permit only one interview to take place.

(4) Preliminary review of documents. Ordinarily, an investigator will interview the claimant about liability and damages at the same time. Accordingly, assemble and study all documents pertaining to these issues before the interview and have them available at the interview. When planning preparation time for a claimant interview, do not forget that the claimant or the claimant's attorney must supply many documents.

(5) Location. If at all possible, especially when a claimant is seriously injured, conduct the interview at the claimant's home. It affords an invaluable opportunity to observe the claimant's lifestyle, interactions with family members, and ability or inability to perform some daily living activities.

(6) Pre-interview preparation.

(a) Obtain as many of the claimant's medical, military, and financial records as possible.

(b) Prepare a chronology of the medical care provided, relating it to key events in the claimant's life (marriage, birth, permanent move, and retirement).

(c) List any matters that need clarification (such as internal contradictions in the records or conflicts between records and allegations).

(d) Always prepare a detailed list of questions to ask the claimant. If not, you will invariably forget to ask an important question!

(e) Research the applicable state law on damages so that you can ask relevant questions.

(7) Attendees at the interview.

(a) When possible, two claims personnel should attend. It is extremely difficult for one individual to establish rapport, observe the claimant, ask questions, take detailed notes, and devise follow-up questions at the same time; it is even harder to do all these things without disrupting the interview.

(b) For complex injury cases that are likely to involve a medical trust (such as, brain damage or quadriplegia), it is helpful to bring the medical fund advisor and/or the life care planner who will be working with the family to serve as an additional observer or take notes.

(8) Conducting the claimant interview.

(a) Try to create a relaxed, informal atmosphere, not an interrogation. Keep your demeanor as informal as possible. If the claimant is willing and able, permit the claimant to narrate the incident without interruption.

(b) Since a structured settlement may be used, obtain detailed information about the claimant's family background and living arrangements, financial resources and family members, including grandchildren. Design the initial interview questions to elicit as much background information as possible. Not only is this critical to a damages assessment, but the casual interchange in which the claimant reveals some personal information should relax the claimant and facilitate the subsequent exchange of more critical information. Even if you are familiar with the claimant's personal or military background (through review of the official military personnel file), let the claimant relate his or her own personal history. If you are already familiar with the information, you will spend less time taking notes and have greater opportunity to maintain eye contact and establish rapport. If the claimant's spouse is also present, make sure that you ask about the spouse's personal background and health, even if not a claimant. The spouse's own life expectancy may be a factor in settlement.

(c) Before ending the interview, always check your question list as well as your interview notes. Make sure the claimant's answers are clear, complete, and unambiguous. Make sure the claimant has no additional questions. Summarize what you have understood from the interview and give the claimant an opportunity to correct your understanding.

(d) At the end of the interview, try to have the claimant consent to a re-interview at a later date if necessary.

(9) Interviewing claimant on liability. A complete history of the claimant's medical care and treatment before the incident is critical to the investigation.

(a) Determine whether the claimant is a poor historian by referring to medical records. Elicit from the claimant the facts of any major or chronic illnesses, hospitalizations and long-term medication use. Bring a list of major medical conditions, such as hypertension, heart disease and diabetes and ask if the claimant now has, or has ever had, any of these conditions. Invariably, the claimant may forget to mention one or more chronic conditions, having learned to ignore them as an inevitable and manageable fact of life.

(b) Obtain the claimant's family medical history. Again, refer to the list of major medical problems and conditions. Make particular notes of any relevant family medical history that the claimant's medical record does not note (but which the claimant's physician, perhaps, should have elicited and noted). The claimant's family medical history is also useful in assessing the claimant's life expectancy and may serve to rebut or reinforce statistical figures.

(c) Have the claimant relate the incident by recall. Determine not only how much the claimant recalls independently, but also which events the claimant mentions or emphasizes, thereby shedding light on what really motivated the claimant to file a claim.

(d) Go back and review the same events with the claimant, referring specifically to the medical investigative reports and records or documents. Ask the specific questions that are key to a liability determination. These questions are case specific, and the interviewer should prepare them before the claimant interview with the AAO's assistance, as needed. Carefully explore any contradictions between the medical entries and the claimant's recollection of events.

(e) Make sure to cover all periods of non-treatment. How the claimant felt and what the claimant was doing during intervals between medical treatment is critical.

(f) After thoroughly exhausting the claimant's recollection of events, ask the claimant about any discrepancies between these recollected events and the medical records or those of the treating physician.

(10) Interviewing the claimant on damages. See section VI, Determination of Damages. When indicated, stress that although you have not yet determined whether liability exists, you want to avoid subsequent inconvenience or delay if liability is established.

(a) Ask how the alleged injury has affected the claimant's ability to perform or to enjoy the following:

(1) Employment.

(2) Conjugal duties.

(3) Parental responsibilities.

(4) Social responsibilities.

(5) Leisure time activities.

(6) Basic activities of daily living.

(b) In serious injury cases, ask the claimant to describe a typical day or week.

(c) If the claimant needs medication, therapy or other special care or treatment on a regular schedule as a result of the injury, have the claimant relate the nature and schedule of each administration.

(d) If permanent pain and suffering are alleged, ask the claimant to describe in detail the pain's nature and frequency as well as what course of action improves or worsens it.

(e) If the claimant seeks compensation for physical disfigurement, obtain "before" and "after" photos. The latter should be enlarged color photos taken by a medical photographer.

(f) In a devastating injury case, a video is helpful in ascertaining the nature and extent of the injured party's disabilities. The video should include, at a minimum, footage of the injured party eating, bathing, dressing, playing, undergoing therapies, communicating and interacting with family members and health caregivers.

(g) When a possible structured settlement is involved, elicit information bearing on future financial needs. Present financial status, to include all assets and liabilities, is needed. Future income regardless of source, for example, pensions and dividends, should be determined. In a wrongful death claim, the survivor's future income, assets and liabilities are needed, including the ownership of a home or dwelling. Obtaining such information will enable a financial planner to formulate a plan of care for the future which can be converted into a structured settlement.

(11) Interviewing the claimant on a statute of limitations issue. See paragraph 2-44 . Use these basic criteria and techniques during any claimant interview in which the statute of limitations may affect the claim.

(a) A statute of limitations investigation involves determining when the claimant, or the parent, when the claimant is a minor, reasonably should have known of the injury and its cause, but not when the claimant knew there was negligence. It is most frequently used in medical malpractice claims. Accordingly, it is one of the most difficult investigations to conduct.

(b) This investigation should involve collecting the patient's complete medical records and obtaining a list of all attending HCPs pertinent to the claim. Additionally, the investigator must obtain the claimant's comments on the outcome of the treatment in question and determine the current medical problems. The investigator must also identify which HCPs (such as doctors, nurses, physical therapists, and speech therapists) the claimant has consulted since the alleged injury, as well as schools and employers. This will develop into a list of witnesses to be interviewed.

(c) Allow the claimant to give a narrative account unless specific questioning is essential. Once the claimant commits to one story or one set of facts, try to reconcile differences between the claimant's version, those of other witnesses, and that contained in the medical records. Ask for as specific information as possible about what the claimant was told, when and by whom. Obtain the names of corroborating witnesses.

(d) Use the medical records to establish dates of treatment and the specific medical condition by asking if the claimant agrees with the record description of the condition and dates of all visits. If the claimant disagrees with the notes in the records, ask with what complaint the claimant actually presented. Ask what the claimant was told regarding findings and treatment recommendations. Continue this line of questioning page by page until all the different examination dates or inpatient progress notes involving the alleged negligent care and its followup have been covered.

(e) Ask what the HCP told the claimant or the survivors about the cause of the injury. Have the claimant specify who furnished the information and when. Determine if the claimant discussed or complained about the injury or unexpected result with or to any government or Army official (such as, the Army Inspector General, a member of Congress, the hospital commander, a patient representative, a nurse or the claimant's own commanding officer) or any neighbors. Then contact and interview these sources and obtain copies of any documents they may have. Find out when the claimant first sought legal advice.

(12) Post-interview actions.

(a) Draft an MFR of the interview as soon as possible. First, record a factual narrative of the claimant's statements. Have the colleague who attended the interview with you review the MFR. Resolve any discrepancies and furnish a copy to the claimant for review. Then, in a separate MFR, record your personal observations of the claimant, the claimant's home, family, and neighborhood, as well as your personal assessment of the claimant's credibility.

(b) Verify information provided, as needed, and follow up on any leads, such as interviewing other witnesses or obtaining additional documentation.

(c) If you suspect the disability is not as severe as the claimant alleges, ask for statements from neighbors, friends, or associates and for permission to interview them if necessary.

(d) Speak with the claimant's employer and coworkers to determine the claimant's actual ability to perform the job as well as to assess the claimant's future employment prospects.

2-24. Use of experts, consultants, and appraisers

This paragraph corresponds to AR 27-20, paragraph 2-21 .

a. General. ACOs or CPOs are responsible for obtaining consultants and appraisers to assist them in evaluating a claim. Consider using such experts on any claim in which liability or damages are disputed and the issue cannot be resolved without resorting to an expert's opinion. Examples of such issues are medical malpractice, damage to farm and ranching operations, automobile accident reconstruction, and equipment failure analysis. Whenever the consultant is furnished medical information protected by HIPAA, the consultant, whether a government employee or civilian, will sign an agreement designed to protect the patient's privacy rights. Sample formats for a HIPAA Assurance Agreement for Medical Consultant and a HIPAA Assurance Agreement for an Independent Medical Examination are posted on the USARCS Web site at "Claims Resources," II, c, nos. 15 and 16. The term "consultant" includes, but is not limited to, health care providers, independent medical examination sources, brokers, insurance companies, life care planners, economists and trust companies. An ACO should ensure that the SJA's budget includes funds to hire experts. The AAO can assist in estimating local requirements.

b. Use of U.S. government experts. The U.S. government employs a variety of subject matter experts capable of assisting the claims process. For example, experts within the Army include The Army Depot, Corpus Christi, Texas (aircraft); Combat Readiness Center, Fort Rucker, Alabama; and Tank and Automotive Command, Warren, Michigan (vehicle accidents). Other federal agencies, such as the Agricultural Research Center, Beltsville, Maryland; National Institutes of Health, Bethesda, Maryland; and Center for Disease Control and Prevention, Atlanta, Georgia, can also provide expert opinions within specialty areas. Obtain such services in coordination with the AAO.

(1) When seeking a government expert, always consider first using local personnel who have expertise in a particular area. For example, many installations employ ordnance, aviation, real estate and automobile accident reconstruction experts who can help evaluate liability and damages.

(2) Each ACO should assemble and maintain a desk book of such experts on the installation. This will not only assist in handling future claims but will be available for any Army claims office that needs an expert opinion.

c. When to hire an external expert. As a general rule, an expert from outside the government should not be hired if a government expert's opinion will suffice, or if the cost outweighs the value of the claim. If a government expert cannot be located, hire an outside expert. An outside expert may be hired when the claimant's counsel agrees to accept an expert's opinion only if the expert is not a government employee. This sometimes occurs because claimant's counsel wants to ensure that the expert is absolutely impartial. In this situation, it is best to reach an agreement with claimant's counsel as to the expert you intend to hire. Depending on the circumstances, it may be appropriate to request that the claimant share the cost of hiring the expert. Consult the AAO for guidance.

d. Locating and hiring an expert.

(1) Always hire an expert who has recognized expertise on the subject evaluated. Avoid hiring experts with a reputation for plaintiff or defense bias. The AAO or the U.S. Attorney can often provide names of proper experts. Government experts usually know of capable civilian counterparts who are willing to provide expert opinions. For example, Army physicians often can provide the names of highly qualified civilian physicians who are willing to provide expert opinions.

(2) Never hire an expert and just hand over a copy of the file for review. Prepare a letter with issues to be reviewed and specific questions to be answered in the expert's report. When the claimant is cooperating with the expert's review, allow the claimant to submit questions for the expert.

(3) The expert must provide a written report to obtain payment. Consider releasing a copy of the report to the claimant if this will assist in settling the claim or deterring suit if the claim is denied. A copy of the report must be provided when the claimant has cooperated in hiring and preparing questions for the expert. All decisions to release or deny access to an expert report must be coordinated with the AAO.

e. Independent medical examination. Independent medical examinations (IMEs) may be used to resolve issues regarding causation or damages. Consider conducting an IME on cases in which a claimant alleges temporary or permanent disability or where there are unresolved questions on causation. Occasionally, a claimant or his attorney will refuse to grant informal interviews. Alternatively, schedule an IME to obtain necessary information either as an adjunct to or a substitute for claimant's case in chief. The claimant's representative should actively participate in the IME.

(1) An IME is often helpful in objectively defining the nature and extent of a claimant's injuries. An IME may also be essential in establishing a claimant's prognosis and the cost of future medical care.

(2) An IME may be used to determine damages in complex injury or medical malpractice claims when issues of causation have not been resolved through the usual exchange of expert medical opinions. In this situation, seek an agreement with claimant's counsel to have the claimant undergo an IME to resolve remaining causation or damages issues. Contact the AAO for guidance before discussing an IME with claimant's counsel. Be sure that the physician or hospital conducting the IME is satisfactory to both the government and claimant's counsel. Ask claimant's counsel for assurances that he or she will resolve the claim based on the IME's findings and conclusions. In some cases, it is appropriate to ask claimant's counsel to share the IME's cost. A medical report by the treating physician may suffice in lieu of an IME. If in doubt, have a same-specialty practitioner at the local MTF review the claimant's injury file and X-rays.

f. Property damage appraisals. Use property damage appraisers in cases where the ACO or CPO and claimant's counsel cannot agree on the monetary amount of property damage.

(1) Before hiring an appraiser, attempt the following steps:

(a) Request the claimant substantiate the claim with a second estimate. It is appropriate to provide claimants with the names of individuals or firms considered reliable and fair.

(b) Provide claimant's counsel information showing how the government arrived at its valuation of the claimant's property loss. Encourage claimant's counsel to share his or her property damage analysis. This exchange of information allows the government and claimant to understand each other's position. In many cases, this leads to a satisfactory settlement.

(2) Be sure that the appraiser is satisfactory to both the government and claimant's counsel and that claimant's counsel is willing to settle the claim based on the estimate of the hired appraiser. Request that claimant's counsel share the cost of the appraiser. If claimant's counsel wants to use his or her own appraiser, arrange for the appraisers to conduct a joint appraisal. Make sure the claimant is present at the appraisal. Consult the AAO for guidance.

2-25. Investigating motor vehicle accident claims

Motor vehicle accident claims are probably the most common claim that a field claims office must investigate. These accident claims range from "fender benders" to fatal multiple-vehicle crashes. This paragraph provides a starting point for the investigation by reviewing its components. Contact the AAO if you need assistance in conducting your investigation.

a. Interviewing the Government driver.

(1) Interview the government driver as soon as possible after the traffic accident. Follow the Government Driver Interview Checklist posted on the USARCS Web site at "Claims Resources," II, a, no. 6, which may be adapted to most accidents. Also use these guidelines when preparing to interview the government driver:

(2) As soon as you learn of the accident, contact the driver. Caution the driver not to discuss the accident with the claimant, an investigator or an attorney representing the claimant without first speaking to you. Instruct the driver to refer the claimant or the claimant's representative to you if either asks about the accident.

(3) Determine whether the driver is under criminal investigation or pending criminal charges. If either is pending, do not interview the driver until the investigation or charges are resolved or until the driver or driver's attorney consents to an interview. It is in the interest of the United States to ensure that the U.S. Attorney's Office appropriately represents or defends the government driver. The ACO or CPO should attend the criminal court proceeding and obtain a verbatim copy of the record of the proceeding.

(4) Before the interview, get copies of the driver's military driver's license, DA 348 (Equipment Operator's Qualification Record (except Aircraft)) and, if the driver is a Soldier, the driver's DA 201 (Military Personnel Records Jacket, U.S. Army) if still in existence, or official military performance file. Also obtain a copy of the accident report and any written statements the driver made. Analyze these documents carefully before the interview and bring them with you. When indicated, obtain the driver's civilian driving record. A copy of the DA 201 may be obtained from the National Personnel Records Center in St. Louis, MO, http://www.archives.gov/facilities/mo/st_louis/military_personnel_records/standard_form_180.html .

(5) The driver should be interviewed at the scene of the accident if at all possible. Conduct the initial interview outside the claimant's or the claimant's attorney's presence. When indicated, re-interview the driver at the scene when the other driver and attorney are present with a view toward resolving actual issues.

(6) Be prepared to fully explain the Westfall Act, § 2679 of the FTCA (28 U.S.C. § 2679)

(7) Be prepared to ask questions pertaining to whether the driver was acting within the scope of duty at the time of the accident. See the checklist for scope of duty analysis, posted on the USARCS Web site at "Claims Resources," II, a, no. 6. State law controls whether a driver was in scope at the time of the accident. Become familiar with state law before interviewing the driver.

(8) A rights warning will not ordinarily be necessary. Commissioned officers and noncommissioned officers (NCOs) senior to a Soldier suspected of an offense under the UCMJ must warn the Soldier of the Soldier's rights under Article 31, UCMJ. Rights warnings are not required if the driver is civilian, if the investigator is civilian, or if the charges have been resolved by court-martial, civil trial or non-judicial punishment. Ask the AAO about a rights warning.

b. Claimant's investigation.

(1) Always find out whether the claimant has hired an investigator or accident reconstructionist. If the claimant does not have an accident investigator, do not encourage the claimant to hire one. If the claimant's attorney asks, state that claims personnel will share information about the accident. Review all statutory and regulatory guidance on the release and sharing of information. See paragraph 1-18 .

(2) Do not adopt an adversarial attitude toward a claimant's investigator. Try to find out as much as possible about the investigator's qualifications. The Army's level of cooperation will depend on the claimant's response in kind.

(3) If possible, interview the claimant at the scene with the investigator or reconstructionist present.

(4) Check with the Department of Motor Vehicles or the claimant's insurance carrier for his driving record and prior accidents.

(5) If the claimant's insurer has investigated, try to obtain a copy of its investigation.

c. Site investigation. A visit to the scene will assist in resolving questions about the accident. A site visit may also make it easier to understand how the accident happened. A site investigation should always be conducted when issues of liability exist or when substantial damages are involved.

(1) Materials needed. Any investigator can conduct a professional site investigation with the following simple tools: unlined or graph paper; a ruler; a pencil (not a pen, since erasure may be required on the diagram); a steel tape measure (with a loop on the end) or measuring wheel (may be available from the MPs); a large nail (for use as a stake to hold the tape measure loop); and a camera, preferably digital with panoramic capacity (do not use "instant" cameras as their photographs are difficult to copy).

(2) Preparation.

(a) Before visiting the scene, carefully analyze all available reports and bring copies. Be prepared to compare any previously prepared accident scene diagrams with the scene's actual layout. Have your equipment ready. In particular, be sure you know how to operate the camera, and bring extra film and flash equipment.

(b) Arrange for the government driver and other relevant witnesses to be present when you arrive. If you are to interview the claimant and attorney at the accident scene (always a good idea), arrange for them to arrive after you have had a chance to complete your interview with the driver and witnesses. Never interview the driver for the first time in the claimant's and attorney's presence.

(c) Know the time of day, weather conditions, and lighting that existed when the accident occurred. If the accident occurred after dark, visit the scene during daylight and at night. Conduct a candlepower test to measure lighting where indicated.

(3) Actions at the site of a vehicle accident.

(a) Measurements. Begin by selecting a central reference point that allows triangulation of distances. Always correlate photos and measurements. Use the steel tape measure with a loop at the end and always measure to the center of an object. Measure the width of lanes and shoulders, the distances from point of impact to point of rest, the distance between the vehicles at rest, the distance between the point at which drivers or witnesses say a driver perceived the other vehicle in the accident to the point of impact, and the distance between witnesses and the point of impact or other relevant points.

(b) Photographs.

(1) Obtain a digital camera with a telephoto lens and at least three megapixels.

(2) On the back of the prints, record the date and time the photos were taken and the photographer's identity.

(3) Take plentiful photos both panoramic and zoom at all possible angles. Include the entire scene, that is, the views of both drivers as they approached the collision site at the same angle as they viewed it. Photograph any skid marks, scrape marks, debris, potholes, and obstructions to vision (for example, a tree, building, bush, or parked vehicle). Use a person as a point of reference.

(4) Photograph a vehicle inside and out from all angles including preexisting damage, the VIN number and license. Make sure the numbers correspond with those on the police report, repair estimate and vehicle registration. Photograph damage to the lower or underneath portion of the vehicle at the same level as the damage using a measuring device. Unless photographed at the scene make sure the vehicle is photographed on a level surface.

(5) When adequate lighting is an issue, for example, if the accident occurred during twilight or darkness, photograph all artificial sources of light such as street lights, light from buildings or signs. Photograph at the same hour that the collision occurred.

(6) Assume that your photographs will be available to the claimant's attorney.

(7) Plan to prepare a detailed memorandum of your investigation, using the pictures as exhibits. Do not use only the pictures and your memory.

(8) Print photos in color on 8x10 inch glossy paper.

(c) Accident scene diagrams. Accident scene diagrams need not be drawn to scale nor be overly detailed. Have such a diagram sketched at the scene, sufficiently accurate to correlate with photos. At a minimum, include the following information in every diagram:

(1) The intersection involved, identifying the streets and indicating the type and location of traffic control devices.

(2) The direction of each vehicle's approach, the point of impact, skid marks (length and direction), and each vehicle's final resting point (noting the distance from point of impact).

(3) Any obstructions or road hazards that contributed to the accident. Be sure to show distances from the reference point.

(4) Any source of artificial lighting and its distance from the point of impact for accidents occurring after lighting sources are activated.

(4) Vehicle inspection.

(a) Initial actions. As soon as you learn of the accident, identify the vehicles involved and determine their location and whether they are available for inspection. This is essential in multiple vehicle accidents and when there are serious injuries or questionable liability issues. Obtain a registration and title for all vehicles involved. Lapses in registration may indicate periods during which the vehicle was inoperable due to previous accidents. Make note of whether the vehicle is titled or registered in the owner's name. Also, note if the policyholder's address matches the regular use or garage location of the vehicle. If there are inconsistencies in any of the foregoing, then view the claim as questionable. Ask the claimant where his vehicle is normally repaired or serviced. Failure to disclose this information may indicate a previously damaged or salvaged vehicle. If possible, ascertain whether anyone has already inspected or photographed the vehicles. This may have been done by police, investigators, owners or witnesses. If so, attempt to get copies prior to your inspection. When inspecting the vehicles, attempt to determine the exact point of impact between the vehicles involved. Match the damage claimed to the points of contact. Take note of any severe damage that is being claimed but that does not match up. Be sure the damage claimed is consistent with the circumstances of the accident. Be alert for additional damage that may have been done after the collision. Also note any other vehicle discrepancies that may have existed prior to the accident such as condition of tires, vehicle modifications, and anything that could obstruct vision (for example, tinted windows, items attached to the rear view mirror, clutter in the vehicle, and so forth.)

(b) Crash data recorders (black boxes). During the investigation of a traffic accident, determine if any of the vehicles involved are equipped with a crash data recorder (a "black box"). This is especially critical if liability, speed, severity of injuries, and so forth. are in question. Take appropriate measures to ensure that the recorder is safeguarded and available for subsequent inspection. The crash data recorder preserves the following information starting five seconds before impact: vehicle speed, engine speed, brake status, and throttle position. It also reveals the following additional information: state of driver's seat belt switch (on/off), SIR (Supplemental Inflatable Restraint System) warning lamp status (on/off), passenger's air bag enabled or disabled (on/off), time from vehicle impact to airbag deployment, ignition cycle count at event time, and ignition cycle count at time of reading. All of this information can be critical in helping to determine liability and severity of injuries. It enables an accident reconstructionist to more definitively recreate the events occurring before, during and after a collision. A listing of vehicles that currently contain the crash data recorder can be found at www.harris.technical.com . or at other sites available through a Web search.

d. Other investigations that may pertain to the accident. Motor vehicle accidents generate a number of other investigations. Obtain copies of them as your investigation begins.

(1) Types of investigations.

(a) The MP reports.

(b) The CID investigation.

(c) State or local police investigation.

(d) Report of survey.

(e) Line-of-duty investigation.

(f) Safety investigation.

(2) Use of police investigations. State or local police and MP accident investigations pose recurring problems to claims investigators. To understand why a police traffic investigation may not substitute for a claims investigation, the investigator should know some of the police motor vehicle accident investigation's purposes:

(a) Law enforcement. Police investigations are used to charge motorists with traffic or other offenses. In many cases, a police officer will not charge a motorist with an offense even if the motorist is at fault in causing an accident. Avoid drawing conclusions on liability from the absence of charges against an apparently responsible party. Even if charges are brought, it is often difficult to determine who is responsible.

(b) Accident reporting. Traffic reports are used to obtain statistics concerning accidents. This is why police accident reports enter data using codes and numbers. A copy of the code should be obtained and appended to each accident report. The code number may indicate the police's belief as to causation.

(c) Safety. Accident reports help officials determine whether corrective action is needed to prevent future accidents. Such correction may be general (such as establishing educational programs) or specific (such as altering a particular intersection). However, the local safety office is not always aware of accidents. The ACO or CPO should regularly communicate with the safety office to verify the occurrence of accidents. When assistance is needed, the ACO or CPO should ask the safety office for investigative help; it is usually willing to cooperate and provide the claims office with releasable portions of the safety report.

(3) The police interview. Interview the police officer who actually investigated the accident. See the Police Officer Interview Checklist, posted on the USARCS Web site at "Claims Resources," II, a, no. 7. In some cases, the official signing the accident report will not be the actual investigating officer, or the latter may have been assisted by another officer. Interview the police officer at the accident scene. Always ask the police officer to review any personal notes and bring them to the interview. It is crucial to ask the police officer's opinion about the cause of the accident and find out its basis.

(4) Other interviews. Interview ambulance personnel or paramedics as to their observations of the scene and the condition of the injured person. Find out if the injured person made any statement. Obtain the ambulance report.

2-26. Small claims traffic accident procedure

Any claims office may use the following procedure to screen, investigate, and settle automobile accident claims. Experience has shown that many field claims offices spend too much time and effort documenting liability investigations of small claims for motor vehicle property damage. Ideally, a claimant who files a meritorious small claim for such damage should receive an immediate settlement from the claims office. Such a claim may be resolved with the claimant when the claim is filed, if a system for discovering and investigating claims is followed regularly. This procedure reduces both the claimant's frustration and the number of open small claims. Paragraph 2-14 provides more information about small claims procedures.

a. Discovering potential claims. Review all the sources mentioned in subparagraph 2-2b , daily. Upon discovering a traffic accident that may generate liability, open a potential claim file and begin investigating. When the damage appears small and there is no evidence that anyone received medical treatment, investigate the matter as a small claim.

b. Securing report copies.

(1) Police reports. Obtain the MP or state or local police report immediately. The claims office should have a system in place allowing the office NCO in charge or a senior examiner to request the report by telephone, with written follow-up. Enter into an agreement with the MPs on this point. The Provost Marshal liaison office often can obtain state or local police reports.

(2) Other reports. Contact the unit supply or logistics staff and arrange to speak with the surveying officer about the accident. If possible, get a copy of the surveying officer's report. Follow the same procedure for other reports.

c. Obtaining scope of duty information. Request that the responsible officer or supervisor forward pertinent scope of duty information, along with the operator's accident report, SF 91 , to your office. See the USARCS Web site at "Claims Resources," II, a, nos. 22 and 6 for a sample scope of duty statement and scope of duty checklist to use in drawing up a statement. Forward it to the unit for response with a suspense of five working days.

d. Maintaining the small claims file. In many cases, the accident reports and scope of duty information will arrive before the claim is filed. If the information confirms that the claim should be processed under small claims procedures, note that on the chronology sheet in the potential claim file. Keep the potential claim file where personnel who meet with claimants have access to it.

e. Actions when the claimant arrives. The goal is to obtain enough information to assess liability and settle the claim on the spot if the claimant can substantiate damages. If the potential claim file is fully documented, all that is necessary is documentation on damages.

(1) Immediate interview. When the claimant arrives to ask about filing a claim, a properly trained or experienced person should interview the claimant on the spot. This can be an ACO or CPO, a claims examiner, or an experienced claims clerk. At a minimum, all personnel who work at the front desk should be trained to interview the claimant about the accident by referring to the potential claim file and filling in missing information.

(2) Damages. Few claimants visit the claims office with estimates of repair in hand. This is the time to ask about the claimant's damages. The claims office should keep a camera to photograph any damage. Instruct the claimant on filling out the claim form and on local policy concerning repair estimates. Tell the claimant to return with the repair estimate and a completed claim form. If the claimant contends that the police or other reports are wrong, try to resolve the contradiction by visiting the scene, if nearby, with both drivers.

(3) Incomplete claim files. If the data on scope of duty or other information is missing, obtain it by telephoning the unit responsible for the accident either while the claimant is at the office or before the claimant returns. As long as the settlement authority is satisfied that the government is at fault, a handwritten memorandum of the conversation is sufficient. When the damage is minimal, try to agree on repair costs without an estimate.

(4) Settlement. When the claimant has secured an estimate of repair and completed a claim form, the claim should be settled while the claimant is still in the office. The key to this step is delegating authority to settle the claim. The ACOs and CPOs should allow experienced claims personnel to interview the claimant and settle the claim. Train new personnel to do this. The claimant should sign the settlement agreement before leaving the claims office.

2-27. Investigating premises liability claims

a. Variety of claims.

(1) The U.S. as a landowner receives a wide variety of claims based upon a duty to provide a safe place to persons entering lands, buildings, or other places under control of the government. Most numerous are slip and fall claims in places such as exchanges, commissaries, clubs or recreational facilities. The injured party must show that the U.S. had actual or constructive knowledge of the hazard. If the hazard existed only a short while and was not known despite regular policing, there is usually no liability. Prompt investigation by facility managers is the best method of establishing whether liability exists. The ACOs and CPOs should coordinate with facility managers and provide training to accomplish this goal.

(2) Claims based on injuries caused by improper design or construction occur in buildings, playgrounds, camping areas and recreational facilities and require the application of an industry or mandatory standard, which if not met can create liability. Sometimes the failure is obvious, such as routing public roads through a golf course without providing adequate fencing to protect motorists from flying golf balls. Other claims involve construction or design standards which must be complied with, or, if not, justified under the criteria set forth for discretionary function decisions discussed in paragraph 2-39b of this publication. Creation of a dangerous condition or the existence of a dangerous condition in an area for public use creates a duty to warn, which if improper or absent can be a basis to establish liability. A state recreational use statute may limit the duty to warn to willful, wanton or grossly negligent conditions but ACOs and CPOs should insist on proper warning being given in all activities which involve hazards or are inherently dangerous.

b. Specific issues to be addressed. Address the following issues specifically in the investigation, the claims officer's report, and the tort claims memorandum of opinion:

(1) Scene investigation. Compose a diagram of the scene, taking photographs that relate to it. Interview the claimant at the scene or later using photographs. If it is a slip and fall incident be sure to refer to the Slip and Fall Investigation Checklist that is posted on the USARCS Web site at "Claims Resources." II, a, no. 9.

(2) Joint tortfeasors. Place any joint tortfeasor on written notice. In premises liability cases, two types of joint tortfeasors should routinely be considered:

(a) Building maintenance contractors. Janitorial and maintenance services are often provided by independent contractors. Always determine whether the contractor may be responsible for the hazard that caused the claimant's injury.

(b) Manufacturers of floor coverings or floor wax. Always determine whether the claimant's injury was caused by a defective product. When you suspect that a product manufacturer is at fault, contact it with specifics of the accident and invite it to join the investigation.

(3) The duty of care. As paragraph 2-48 instructs, carefully research the law and determine the duty owed to the claimant. Then determine if and how that duty was breached. Avoid settling simply because the claimant fell.

(4) Reason for claimant's fall. If the claimant cannot state a reason, do not offer one. The investigation should always seek to determine the cause of the accident, even if the claimant cannot furnish one.

(5) Expert evaluations. If a claims investigation reveals the need for an expert, discuss this with the AAO, who can assist in locating one. Some areas in which expert evaluations have helped in the past are:

(a) Friction tests. When the claim alleges that a surface was excessively slippery, conduct a friction test on the surface.

(b) Chemical analysis. Floor wax may be chemically analyzed to determine if it is an appropriate product to apply to a floor.

(c) Candlepower tests. Many posts have equipment to test an area's illumination. Such a test should be conducted under the same lighting conditions present at the time of the incident, including both natural and artificial light. Check with the post safety office for assistance. The U.S. Army Center for Health Promotion and Preventive Medicine is also capable of conducting illumination tests and the AAO can provide additional assistance.

(6) Weather data. When weather is a contributing factor, obtain a summary from the U.S. Air Force. Combat Climatology Center ( https://notus2.afccc.af.mil/SCISPublic/ ). For example, if the fall occurred in an area where the amount of natural light is a factor, get a weather summary showing cloud cover, sun and moon data and other illumination factors. If rain, snow or ice factored in the accident, the weather data should include a temperature summary and the amount and type of precipitation that fell that day (and on previous days, if relevant).

(7) Applicable safety standards. Safety issues raise factual and legal issues. Consult the post safety office to find out what standards apply under federal, state, and local law. For example, determine what Occupational Safety and Health Administration standards apply to the activity, make copies and add them to the file. In addition, determine what standards activity personnel recognized and applied. These should include local regulations and standard operating procedures, which also must be copied and filed. Finally, determine whether personnel followed the standards. Interview the individuals responsible for maintenance or safety. Look objectively at what happened and decide whether the rules were followed. Once this has been done, legal research should reveal whether the standard that was violated forms a basis for liability. The claimant's attorney will sometimes argue that federal law, as evidenced by statutes, rules, regulations, and SOPs applicable to the activity, establishes the standard of care. This is incorrect. State law sets the standards for liability and therefore establishes the duty. Stricter federal standards do not necessarily control.

c. Recreational users investigation.

(1) General. Whether the government is liable as landowner when the claimant is injured in a recreational activity is a recurring issue. On all claims involving outdoor recreational activities, personnel must specifically investigate whether the FTCA discretionary function exception (28 U.S.C. § 2680(a)) or individual state recreational use statutes apply. If a flood control project is involved, determine whether the flood or flood waters exception applies.

(2) Discretionary function. 28 U.S.C. § 2680(a). See paragraph 2-39b .

(a) The FTCA discretionary function exception bars claims based upon acts or omissions involving the exercise of discretion in the furtherance of public policy goals. Undertake a two-tier analysis to identify protected discretionary functions. The first inquiry is whether the governmental action involves an element of judgment or choice. If the government employee's act or omission is inconsistent with any mandatory federal statute, regulation or formal agency policy prescribing a specific course of action, the discretionary function exception does not apply.

(b) The second tier asks whether the choice or judgment is one based on, or susceptible to, public policy considerations (social, economic, political and military considerations). Allegations of negligence regarding the design, maintenance, and construction of recreational and other government facilities often involve the types of social, economic, and political policy considerations that the discretionary function exception has placed beyond the reach of the FTCA. See FTCH § II, B4c(2).

(c) At the onset of every claim investigation in which the discretionary function exception may apply, it is critical to identify and review any statutes, regulations, guidelines, directives or policy statements that may affect the activity forming the basis of the claim. Activities may be impacted by, for example, road or trail design, placement of warnings, guardrails or other precautions, and design of recreational areas. Interview an official familiar with the Army's policy considerations underlying the conduct in question to establish that no one has violated any mandatory standards, regulations, guidelines, directives or policies. Be prepared to state what policy considerations an Army representative will articulate in terms of the social, political, economic, or military factors influencing the discretionary activity.

(3) State recreational use statutes. See list posted on the USARCS Web site at "Claims Resources," II, a, 13.

(a) These statutes relax the standard of care imposed on landowners who make their land available to the public without fee. Because the government's FTCA liability mirrors that of a private party under like circumstances, recreational use statutes affect FTCA claims. They vary considerably from state to state. In some states, the statute's applicability is negated if the landowner receives direct or indirect compensation as a result of the activity, has actual knowledge of the dangerous condition on the land, or engages in conduct which is willful, wanton or grossly negligent. A fee is not necessarily considered compensation when used entirely to maintain the recreation project.

(b) In investigating whether a recreational use statute applies, determine, at a minimum:

(1) Whether the United States fits the definition of landowner contemplated by the statute.

(2) Whether the activity that resulted in the claimed injury was one of those the statute specified.

(3) The claimant's motive in entering the area.

(4) Whether the government charges entrance or user fees or receives a percentage of revenues from commercial activities conducted on the land.

(5) Whether the claimant or anyone in the claimant's party actually paid a fee, and whether the fee was used to maintain the project or activity or for another purpose. (Did the fee generate profits?)

(6) Whether the government had actual knowledge of the dangerous condition on the land.

(7) The history of prior similar incidents.

(8) If the condition is unique, whether there were appropriate warnings. See FTCH § II, B4c(2)(d).

d. Under the Flood Control Act. 33 U.S.C. § 702c. See paragraph 2-39b . The government is immune from liability for claims resulting from flood or waters emanating from flood control projects, including multipurpose works. Check the law of the federal circuit interpreting the act as different circuits have varying interpretations. In investigating a claim involving flood waters, determine which act of Congress authorized the project for flood control as well as the degree to which the project is currently used for flood control. Determine whether or not the act required the local beneficiary to assume liability for claims and, if so, obtain a copy of the local agreement. Ascertain the specific method of operation on the dates in question and whether or not they complied with established regulations or standard operating procedures (such as, a control plan for water fluctuation). Obtain the water levels for a relevant period of time, both before and after the date in question. Determine whether any underwater objects were involved in causing the claimed injury, for example, a tree stump or concrete marker. See FTCH § II, B4o.

2-28. Investigating explosion and blast damage claims

a. Property damage. When possible, claims for property damage caused by air blast or ground shock due to artillery firing and similar training activities, including claims arising from destruction of ordnance, should be paid under the MCA as incident to Army noncombat activities. If the claim is not payable, deny under both the FTCA and the MCA. However, if the explosion cannot be considered as part of an Army noncombat activity (for example, if caused by a contractor's manufacture or transport of ordnance), investigate state law. Explosion claims should not be settled for "nuisance" value alone since small nuisance settlements can easily result in other claims being filed once the neighbors learn that the local claims office is paying such claims.

b. Review by a ballistic research and analysis expert. All claims for property damage or loss due to explosions are investigated by local claims personnel who forward them to their AAO for review by a ballistics expert prior to adjudication. The requirement for a ballistics expert's review is based on USARCS' long experience with problems in adjudicating explosion claims. These problems include causation and the lack of a uniform approach to settling these claims at each installation. The ballistic expert's finding as to causation is binding on local claims offices in the absence of other expert opinions to the contrary. Experience has shown, however, that few experts really understand the effect explosions have on structures. See subpara h for more information about expert review.

c. Data maintenance and retention. Unit, range, and ordnance personnel should be required to maintain data needed for the ballistic expert's investigation for three years. Visiting units should be required to report the same data to range control.

d. Local procedures for receiving explosion damage complaints. All installations that conduct routine firing activities should designate one office to receive complaints. This office's existence, and its telephone number, should be widely and regularly publicized in the local media.

(1) When a complaint is received, take the following actions:

(a) Require the complainant to give specific information about the time of the explosion and the nature of any damage.

(b) A response team, consisting of a claims representative, a photographer, and an engineer representative should investigate serious complaints immediately.

(c) Coordinate all reports with the claims office. Both offices should treat all incidents involving property damage as potential claims.

(2) If the claimant alleges that firing activities conducted over a period of time caused damage, interview the claimant to establish the following facts as precisely as possible:

(a) The date the claimant first became aware of blasting or firing at the installation. Also establish subsequent firing dates. For example, has the firing gone on for years or just since the claimant moved in? How often has it occurred?

(b) The date the claimant first decided the firing was a problem and why. For example, the claimant may have been bothered by noise for years but tried at first to tolerate it.

(c) The date the claimant noticed damage and a precise description of it. This is especially important when a claimant alleges cumulative damage, such as cracks in walls, ceilings or driveways that will worsen with time.

(d) The date the claimant "connected" the damage with artillery firing and why.

e. Explosive ordnance demolition reports. When an incident involves or has been investigated by explosive ordnance demolition personnel, obtain a copy of DA 3265-R (Explosive Ordnance Incident Report) and forward it to USARCS.

f. Causation. Determining causation causes the most trouble in explosion damage claims. There are several reasons for this: claimants do not always report damage promptly; they may take weeks or months to come to the claims office. Poor reporting procedures within the command are often at the root of this problem. This can be avoided if the installation implements the procedures set forth in subparagraph g . Further, claimants often associate loud noises or slight earth tremors with structural damage they find upon inspecting their home after hearing the explosion. Typically, when a strong explosion occurs nearby, windows rattle and small objects fall down. Air blasts from explosions rarely cause structural damage, but most claimants will never believe that the crack in their wall or ceiling is not due to the blast they heard or felt.

g. Investigative procedures. Follow the procedures below when investigating property damage claims that are due to explosions and treated as incident to Army noncombat activities. (It is not necessary to investigate negligence issues unless it is obvious that FTCA litigation will result or unless the AAO directs.)

(1) Determine if and when an explosion actually occurred. Range control or a similar entity at most active Army installations will know of any training activity that could have caused the damage. Since many installations have multiple ranges and train many units simultaneously, it is important for the claimant to provide exact times.

(2) Determine who detonated the explosion. This information is usually available from range control, based on the time of the event.

(3) Determine whether the explosion caused the actual damage that the claimant alleges. The claimant must indicate what property was damaged or destroyed. Pictures and descriptions of the property (including locations) are very important.

h. Review by a ballistics expert. Forward a request for review by a ballistics expert to the AAO. It should contain:

(1) A topographic map showing the information listed below (an installation may submit an overlay only if it has previously submitted a topographic map with a request that it be retained for future reference.)

(a) Location of the damage.

(b) The impact area, if applicable.

(c) The firing point(s) involved, if applicable.

(d) The specific location, height, and nature of any obstruction to air blast or concussion if the obstruction is not shown on the map.

(2) A report or study on geological structure between the damage point and explosion point, if damage from ground shock is alleged. Such a report is available from various sources, including the U.S. Geological Survey or the COE. This report may be submitted once and referred to in future claims.

(3) A report by an installation employee or other person familiar with the type of construction involved, if structural damage is claimed. This report should include:

(a) Type of structure and its construction (general details), for example, " a two-story frame house with aluminum siding."

(b) Age of structure.

(c) Condition or state of repair of structure.

(d) Date and nature of any repairs to the structure.

(e) Date and nature of any additions or remodeling.

(f) Type of heating and air-conditioning system and the dates and types of changes to the system.

(4) Photographs of all alleged damage, including wall, ceiling, swimming pool and driveway cracks. Inspect the damage personally to estimate the age of the damage. For example, if the claimant alleges that a blast earlier in the day caused a crack in the basement wall and you see that the crack is full of dirt, report that observation. Do not rely on photographs alone to show the damage.

(5) Location and extent of any other damage in the vicinity. Also report the lack of any damage, especially to nearby structures.

(6) Other sources of the damage, including sonic booms, quarry blasting, severe weather disturbances or heavy vehicular traffic.

(7) Specific information about explosives:

(a) Amount and type.

(b) Date and time fired.

(c) The depth, if buried.

(d) Minimum and maximum weights of any propellant or filler used.

(e) The number of inert or "sand" rounds used, if any, as well as the total number of rounds fired.

(8) Wind speed and direction from true north at ground level and at all accessible altitudes to 5,000 feet.

(9) Temperature at all accessible altitudes from ground level to 5,000 feet.

i. Detonation of unexploded ordnance.

(1) Duds. Ranges and other areas where unexploded ordnance (duds) are present exist on many Army installations. Duds attract children and curiosity seekers as well as scavengers who salvage scrap by illegally entering ranges. Such persons are sometimes injured or killed by detonation of ordnance on the range or by items they remove.

(2) Investigation and research.

(a) Whether the claim involves an injury occurring within an impact area or one sustained when the claimant or others took munitions from a range, research state law to determine the existence and scope of a landowner's duty to warn of a hazardous condition and whether the Army breached this duty. In this regard, the Army is entitled to operate an impact area for training purposes but it must do so safely. The presence or absence of warning signs is especially important. Many states have adopted, and impose, strict liability on those who injure others by conducting ultrahazardous activities, such as blasting. Strict liability does not apply to claims brought against the United States because the FTCA requires that negligence be shown to recover compensation. However, the noncombat activity provisions of the MCA are applicable.

(b) Carefully investigate the existence of any published notices and any warning signs. The claims officer's report must include:

(1) A picture of the signs used to mark the impact area. If possible, photograph any signs the claimant saw. Their wording and any symbols used must be clear and legible in the photograph.

(2) A map showing the entry and exit points and the area that the claimant traversed inside the impact area. Clearly mark any warning signs on the map.

(3) Any notices published in the local media about the impact area's hazards.

(c) Determine the claimant's actual knowledge of the hazard posed by the impact area from various sources. Interview the claimant and the claimant's friends, relatives and coworkers on this specific point. In the case of scavengers, check police, FBI, and Bureau of Alcohol, Tobacco and Firearms records to learn if the claimant has ever been investigated or arrested for trespass on, or theft from, the impact area.

(d) Investigate range-clearing activity. Request explosive ordnance demolition records of the dates and extent of destruction of duds on the range for at least one year before and one year after the incident. Determine the procedures used for clearing the range and identifying the duds, the type of ordnance removed, and the numbers of each type of ordnance. Review FM 4-30.5 before investigating the incident. (FM 4-30.5 is available to DOD personnel at http://www.train.army.mil )

(e) Find out how many prior incidents occurred at the site and obtain pertinent records. Range control can usually provide this information.

(f) If the claim involves an abandoned range or impact area, obtain or investigate the following:

(1) Date when the range or impact area was deactivated and reasons why.

(2) A map showing the extent of the major impact area, both at the time of deactivation and at the time of the incident.

(3) Records of the procedures used to clear the range or impact area, or witnesses who supervised or actually performed the task. If a contractor performed the cleanup, obtain a copy of the contract file. Also determine the type and numbers of duds cleared or removed from the range.

(4) The procedures followed to turn over the range or impact area for public inspection and use. Investigate whether any restrictions were placed on the use of the property.

(5) If there were prior incidents in which authorities found ordnance on the abandoned range or impact area, determine what procedures they followed to dispose of the ordnance (and if such measures were appropriate). Find out if the Army or other federal agency was notified that ordnance was found and took part in its disposal. Obtain incident and police reports.

(g) If the explosion occurred at a distance from the range or impact area, but claimant alleges that the ordnance came, or was removed, from it, the investigator must determine whether the ordnance was actually removed-that is, whether the item that exploded was Army ordnance. In such a case, specifically investigate the following points (in addition to those noted above):

(1) The precise type of ordnance that detonated.

(2) The range or impact area from which the ordnance allegedly came. This is established by contacting range control to determine if training had been conducted using that type of ordnance.

(3) How the item came into the claimant's possession and how long the claimant had it. In some cases, the item is passed from one person to the next by sale or gift. Many people collect ordnance as souvenirs or for other reasons. Remember that the item may actually have been in the possession of the claimant or others for many years.

(4) Serial numbers of the exploded ordnance and of any other rounds at the scene or associated with the claimant. Obtain serial number identifications. For assistance in tracing the source of ordnance, CJAs or claims attorneys should contact:

Anniston Army Depot
7 Franklin Ave.
Anniston
Alabama
36201-4199
256-235-6686

(5) Photographs of the exploded shrapnel. Submit the shrapnel to an ordnance expert to identify the type of round and how long ago it was fired.

(6) If the ordnance is not uniquely military (such as hand grenades), determine whether anyone else in the community possesses similar ordnance. Find out if anyone is conducting mining, logging or other activities in the area and if the item could have come from one of those sources.

2-29. Investigating overflight claims

a. Claims involving Army aircraft.

(1) An overflight claim alleges property damage due to low-flying aircraft. The claim may allege one overflight or a series of overflights. Overflight claims present problems in verifying the fact that an overflight occurred, identifying the origin of the aircraft involved, proving that the alleged damages were due to the overflight, and deciding whether the MCA or the FTCA applies to the claim. Overflight claims may also lead to inconsistent decisions.

(2) Certain requirements are unique to claims involving aircraft and overflights. To investigate an overflight claim successfully, a claims officer should consider the following points:

(a) Which aviation units are assigned to installations within the claims area, their missions, and the type of aircraft used by these units. Establish liaison with the appropriate staff agencies for major units to facilitate exchange of information should a claims investigation be necessary. With their assistance, the claims officer should maintain a map depicting the local flying area, marking well any low-flying training routes. The local flying area will extend beyond the installation.

(b) Installations with activities that fly frequently should designate an office to receive complaints concerning overflights.

(c) The Federal Aviation Agency's (FAA) suggested minimum safe altitude requirements are 1,000 feet for congested areas and 500 feet for others ( 14 C.F.R. § 91.119 ). DOT minimum safe altitudes do not apply to helicopters. Helicopters may be flown at less than minimum altitudes if they are operated without hazard to persons or property on the ground. Additionally, neither standard may apply when nap-of-the-earth (NOE) flying is involved. Determine the best available NOE route.

(d) The claims office should have a copy of any local regulations on aircraft operations and of FM 3-01.80 (available to DOD personnel at www.train.army.mil ), which aids in eyewitness identification of aircraft by publishing photographs, silhouettes, and characteristics of U.S. and foreign aircraft. The claims office should also obtain a grid map that includes routes and location of the incident.

(e) Always seek an experienced aviator's help when investigating or evaluating an overflight claim. Such assistance is especially valuable in determining the identity of the aircraft and crew involved in an overflight.

(f) Retain files from past overflight claims in the claims office to allow comparison and to provide historic information about such incidents. The claims office should also keep information concerning the establishment and frequency of use of flight patterns and training routes; this can be critical to the evaluation of overflight claims. Such information should include file copies of studies and decision memoranda about establishing these routes.

b. Claims that do not involve Army aircraft.

(1) If the claim does not involve Army aircraft, find out whether another Service's aircraft is involved. The Air Force and Navy both use helicopters and subsonic fixed-wing aircraft. When it is possible that aircraft from these Services may be involved, be sure eyewitnesses examine silhouettes of these aircraft to identify them. A computer register for Air Force aircraft is available through the Aviation Claims Branch, U.S. Air Force Litigation and Claims Service, (703) 696-9055. If an alleged overflight involves subsonic aircraft, do not try to transfer the claim until you are absolutely certain that Army aircraft are not involved.

(2) The Army does not operate supersonic aircraft; in rare cases, however, Army claims offices handle sonic boom claims, for example, those involving NATO SOFA foreign aircraft. Claims involving sonic boom damage resulting from the flight of a foreign aircraft or crew may be cognizable under a SOFA (AR 27-20, chap 7 ). The Army is responsible for investigating and paying these claims. Contact the appropriate USARCS AAO for guidance. However, if the claim involves Air Force aircraft, contact the nearest Air Force claims office or the Aviation Branch, USAF Litigation and Claims Service, for assistance. They maintain a register of all sonic boom flights in accordance with AFI 13-201 . When requesting assistance from Headquarters, U.S. Air Force, provide the date, Zulu time, north and west coordinates, and geographic location of the alleged damage.

c. The investigation. The following issues must be specifically addressed in the investigation, the claims officer's report, and the tort claims memorandum of opinion:

(1) Identity of the aircraft. The initial focus of the investigation is identifying the aircraft involved in the overflight, not ruling out overflight by Army aircraft. Therefore, do not use the claimant's inability to identify the aircraft positively as a primary basis for denial. When interviewing a claimant or witness, refer to FM 3-01.80 and consult an experienced aviator to establish the aircraft's class and identity. Silhouette charts are helpful. If the claimant or witness interviews are inconclusive, screen all units that normally train in the area, including Army Reserve and ARNG. Also contact the SJA, HQ, U.S. Army Special Operations Command, for overflights involving aircraft that may be assigned to it.

(2) Unit and crew. If Army aircraft are responsible for the damage, determine the unit allegedly responsible for the overflight. This is easier to do if you are familiar with the units stationed within your claims area and have established liaison with the G-5 or G-3 (air). Once you identify the unit, you can usually identify the crew involved. Interview its members about the incident.

(3) Map of the incident site. Obtain a grid map that includes the affected area. If it does not already show the routes and location of the incident, these must be drawn on it. It should include the local flying area generally, aircraft routes and any other information relevant to the claim.

(4) Applicability of the MCA, FTCA, and the Tucker Act.

(a) Although it is possible to apply the FTCA to determine liability, traditionally claims personnel have paid overflight claims under the MCA. This is because negligence is hard for the claimant to prove and the amount of the claim is too small to justify a lawsuit. The overflight usually involves normal military activity conducted according to military requirements and thus is not subject to the same standards as civilian activity. In most cases, if the claim can be settled under either Act, it should be investigated and settled under the MCA. Where the claim is not payable, deny the claim under both the FTCA and the MCA.

(b) Overflight claims alleging that repeated overflights have interfered with the use and enjoyment of property may be cognizable under the Tucker Act (28 U.S.C. § 1491). Information on the establishment and use of training routes may be essential in evaluating these claims. The claims must be carefully investigated and coordinated with the AAO. Claims cognizable under the Tucker Act are not subject to the administrative claims procedure and filing an administrative claim does not toll the statute of limitations. Screen such claims carefully and inform the claimant that the statute of limitations continues to run on the Tucker Act claim.

(5) Causation and damages. Causation is an issue frequently presented in overflight claims. A finding of causation must be supported by facts, not assumptions. Deny the claim when the adjudicator determines that the flight met the FAA's suggested minimum altitude requirements (see para 2-29a(2)(c) ), unless there is an acceptable expert opinion to the contrary. Note, however, that there are no known scientific studies establishing causation when an aircraft is flying at suggested minimum altitudes. The requirement is applicable to fixed wing aircraft but not to helicopters. In addition, it is often difficult to calculate the amount of damages sustained. Use of Army or civilian experts or appraisers may be essential in evaluating damage claims. Coordinate this action with your AAO.

d. Interviewing eyewitnesses.

(1) Elicit as much information as possible about the aircraft involved before showing the witness FM 3-01-80 . The description given by the eyewitness should include:

(a) Color, markings and tail number.

(b) Type (fixed wing or rotary).

(c) Unusual characteristics (fuel tanks, landing gear, armaments, and shape of tail).

(d) Sound made as it approached and departed.

(e) How long the sound could be heard.

(f) Intensity of the sound.

(g) Approximate height above the ground (avoid an estimate in feet unless the witness has experience to estimate).

(h) Could the witness see the crew members or passengers on the aircraft? Describe them.

(i) Did the aircraft hover? How long? How high?

(2) Show the witness FM 3-01.80. Do not just hand the book to the witness.

(a) If the identity of the aircraft is obvious, just show the page that contains the aircraft.

(b) If there is a question as to its identity, narrow down the aircraft as much as possible and show those pictures to the witness. For example, if the aircraft involved appears to be a helicopter, show the pictures of the helicopters. If the witness gives a description that fits several different helicopters, show those to the witness. Do not try to trick or mislead the witness.

(3) If necessary, confirm the identification by consulting an experienced aviator.

2-30. Investigating claims involving registered and insured mail

Consider the following issues when investigating claims under the MCA for loss of registered or insured mail:

a. The fact of loss while in the possession of the Army must be established. To that end, attach these documents as exhibits to the report:

(1) The mail registry reflecting that the lost mail was receipted by an Army postal clerk.

(2) Evidence that the Army mail clerk's signature is genuine. A mail clerk's statement to this effect will generally suffice. If the signature was allegedly forged, obtain a copy of the postal clerk's signature on a document of undisputed reliability, such as a personnel document. Compare the signatures. If there is no reliable evidence of forgery, there is no need for handwriting analysis to substantiate the loss.

(3) Evidence that the alleged recipient received the mail (the actual receipt) along with reliable evidence of the recipient's signature. Again, handwriting analysis is not required if it can be determined that the signature is either genuine or forged.

b. A specific finding whether the sender or addressee owned the article.

c. The sender's and the intended recipient's statements about the loss. This ensures that each knows that a claim has been filed and that the proper claimant will receive any payment. Both parties should address the following issues in their statements:

(1) A description and valuation of the contents of the letter or parcel, supported by estimates, sales receipts, or other evidence.

(2) The registered or insured mail receipt reflecting the fee paid for insurance, postage and the parcel or letter's declared value.

(3) Evidence of the parcel or letter's damage or loss.

(4) The time and place the U.S. Postal Service first delivered the letter or parcel to the Military Postal Service or other authorized Army military or civilian personnel for distribution.

(5) Whether the letter or parcel was redelivered to the U.S. Postal Service for forwarding or any other purpose.

(6) Whether either received reimbursement from any other source, including private insurance.

d. A copy of any U.S. Postal Service investigation or other investigation concerning the loss.

e. DOD 4525.6-M is essential to conducting a proper investigation of these claims.

2-31. Investigating claims involving family childcare providers

See paragraph 12-9f of this publication.

a. Conducting family childcare investigations.

(1) Assemble the following basic documents in all family childcare claims:

(a) The MP and CID reports.

(b) The complete contents of the family childcare provider's file.

(c) The power of attorney and agreement between the family childcare caregiver and parent(s) of the injured or deceased child.

(d) The physical examination administered to the child prior to its entry into the family childcare program (family childcare providers usually have a copy).

(2) Visit the family childcare caregiver's home as soon as possible after the incident. Photograph the scene, even if others have done so.

(3) Examine the incident carefully to see if there is a basis for holding the United States liable independent of the care rendered to the child. For example, if a child is burned by hot water in a bathtub, claimant will almost certainly allege that the hot water heater was defectively maintained. Discuss federal liability issues in the tort claims memorandum of opinion.

(4) Investigate the incident with a view toward determining whether the United States or another party is liable for the injury. For example, an operator of leased housing may be responsible for premises liability, or the manufacturer of a hot water heater may be responsible under a products liability theory.

(5) Although family child care caregivers are not required to maintain private insurance, always interview the family child care caregiver about its existence. Always obtain a copy of any liability policy that covers the care given. Be sure that the caregiver complies with the insurance policy's notice provisions.

(6) Always decide whether to assert an affirmative claim when someone other than the Army or family childcare provider may be liable. Before doing so, coordinate with the AAO.

(7) Determine if the provider is certified by the family child care coordinator.

(8) Make sure the child was authorized to be kept in the home under the provisions of AR 608-10 . If the child was not covered by a valid family child care agreement, find out whether the family child care director or inspector knew that unauthorized children were present. Always look beyond the agreement to ensure that the child was entitled to family childcare. The lack of a valid agreement will not necessarily invalidate the claim, if the parent and the family child care provider attempted to comply with the family child care requirements.

(9) Determine whether the claim falls within the coverage limits set forth in AR 27-20 .

(10) Secure a copy of the state and local standards for licensing in-home daycare operations. On this point, remember that AR 608-10 allows, but does not require, state certification. If the family child care provider holds a current state certification, obtain a copy of the state certification file (this may require a release from the family child care provider). When interviewing the family child care provider, ask about prior state certifications in other locations. Always ask about prior allegations of child abuse or neglect, including those involving the family child care provider's own children.

(11) When the claim involves an allegation that the family child care provider burned the child with hot water while the child was bathing, test the hot water heater and plumbing system to determine the hot water temperature at the tap. Water heater thermostats in family childcare provider quarters should not be set higher than 110 degrees Fahrenheit. If the home inspection records show that the temperature was properly set and that the thermostat was not accessible, no liability is indicated.

b. Determining of liability. Upon completion of the investigation, determine whether any U.S. employee was responsible for the injury. If not, the claim is payable under AR 27-20, chapter 12 , but not under the FTCA or the MCA. Discuss how to proceed with the AAO.

2-32. Investigating claims arising from shoplifting

a. Claims by persons suspected of shoplifting usually arise from their physical detention by AAFES employees (typically store detectives). These claims must be adjudicated under the law of the state in which the claim arises. It is important to remember that under the FTCA, the United States is liable only to the same extent as a private person would be. Most states have enacted statutes authorizing merchants or their employees to detain or arrest suspects. These statutes also grant authority to conduct a reasonable search.

b. Under the FTCA, a claim arising from false arrest is excluded from consideration except when the arrest is made by a federal law enforcement officer. AAFES personnel have been held not to be federal law enforcement officers, despite their denomination as security personnel. See Solomon v. United States, 559 F.2 d 309 (5th Cir. 1977). MP personnel have been held to be federal law enforcement officers. Accordingly, an MP's involvement in a shoplifting detention or arrest may bring the claim within the FTCA's purview.

c. The AAFES rules prohibit their personnel from searching a suspect. Store personnel should notify the MPs immediately and request that they come to the scene, take charge of the case, and conduct any search of suspects. However, store personnel need not call the MPs when it becomes evident that the suspected shoplifter does not have the merchandise.

d. The ACOs and CPOs must become familiar with their state shoplifting laws and properly advise local AAFES personnel. If possible, develop local procedures within the guidelines of AAFES Exchange Operating Procedures (EOP) 57-2 to avoid using MPs while nevertheless complying with its edict not to search a suspect. Suspects should always be given the opportunity to demonstrate voluntarily that they are not in possession of the suspected stolen merchandise. The goal of AAFES and claims personnel is to avoid occurrences that lead to the filing of claims.

e. The investigator should review the store's videotape, if any, and obtain a copy where indicated. Interview all witnesses, including the claimant, on location and devise an exact-time chronology based on these interviews. Rarely is the MP report adequate. Of primary importance is the physical description of the place where the suspect interview and search occurred, and whether it was open to public view.

2-33. Investigating dram shop and social host claims

See paragraph 2-48e(1) .

a. General. Claims arising from the overuse of alcohol sold at Army clubs or stores or from over serving at Army functions, formal or informal, require investigation when an injury or death results from these activities. For review of statutory and case law, see FTCH § II, B4a(1)(d).

b. Nature of investigation.

(1) What regulatory restrictions, including those established at the installation and unit levels, were violated in holding the function at the particular time, place, and manner, or in celebrating that particular event?

(2) What regulatory restrictions, including those established at the installation and unit levels, did the federal employees violate in possessing, using, or serving alcoholic beverages at the particular time, place, or type of event in question? See, for example, AR 215-1 .

(3) What additional guidance on this subject did the allegedly negligent actors receive through safety briefings, counseling sessions, or meetings?

(4) Was the site of the function the participants' assigned place of duty when the incident occurred?

(5) What was the participants' duty status at the time of the function?

(6) Was the function held during normal duty hours?

(7) Did anyone with supervisory authority compel or encourage personnel to attend or participate in the function?

(8) Was the function held in a government-controlled facility?

(9) Did any supervisor or military superior authorize the function or know of it in advance and somehow acquiesce in permitting it to be held?

(10) What was the source of the funds used to purchase the alcoholic beverages and other refreshments, food or supplies for the function?

(11) What levels or signs of intoxication or sobriety did the allegedly negligent actors observe? What was the character and duration of their contact with the intoxicated individual?

(12) If significant signs of intoxication were not observed, could that be because a particular individual, such as a doorkeeper or charge of quarters, failed to perform a mandatory inspection or other assigned duty?

(13) What was the military relationship between the allegedly negligent actor and the intoxicated individual?

(14) What measures, if any, did the allegedly negligent actor undertake to determine whether the allegedly intoxicated individual actually was intoxicated?

(15) What measures, if any, did the allegedly negligent actor undertake to discourage or prohibit the intoxicated individual's subsequent use of a motor vehicle, and why were those measures ineffective?

2-34. Investigating medical malpractice claims

a. Introduction. Medical malpractice cases resemble any other tort claim requiring specialized knowledge, and their scientific or technical aspects should be the subject of preliminary study. It is helpful to have certain reference materials on hand as one begins a medical malpractice investigation. Some suggested references include:

(1) Pertinent Health Service Command and hospital regulations and standing operating procedures.

(2) AR 27-40 .

(3) AR 40-3 .

(4) AR 40-66 .

(5) AR 40-68 .

(6) The Merck Manual of Diagnosis and Therapy or other general medical text.

(7) Physicians' Desk Reference (PDR).

(8) A medical dictionary such as Taber's Cyclopedic Medical Dictionary.

(9) An anatomy text or atlas such as Gray's Anatomy of the Human Body.

(10) Each MTF has teaching aids for various operative and medical procedures. These include textbooks that have graphic step-by-step photographs and diagrams of medical and operative procedures, and videotapes of actual operative procedures. These aids should be reviewed prior to factual investigation or interviewing of key personnel.

(11) A plethora of information may be obtained from various sites available on the Web. Usually a key word search using one of the popular search engines produces good results. Only use medical reference Web sites to obtain basic and background information, deferring to experts for detailed analysis. Some organizations with reliable and useful medical reference Web sites include MedicineNet ( http://www.medicinenet.com/script/main/hp.asp ), Medline Plus (by the National Library of Medicine and National Institutes of Health) ( http://medlineplus.gov/ ), the National Cancer Institute ( http://www.cancer.gov/ ), the Army Medical Department (AMEDD) ( http://www.armymedicine.army.mil/ ), and the Medem Web site ( http://www.medem.com/ ) (produced by medical societies).

b. Risk management and patient safety regulation, AR 40-68.

(1) For tort claims purposes an investigation should begin as soon as a sentinel event or PCE is identified. Chapter 12 of AR 40-68 involves the CJA as part of a team to provide for better patient safety and risk management. See AR 40-68, paragraphs 12-1a , 12-4a(3) , 13-1 , 13-2 , and 13-4a(1) . This allows the CJA to be involved in the identification and investigation of medical malpractice prior to the filing of a tort claim. However, as access to a quality assurance investigation is restricted by 10 U.S.C. § 1102, the CJA must conduct a separate investigation using the same sources and medical records.

(2) The CJA should be involved in the establishment of a patient safety program as set forth in AR 40-68 , para 12-13. Specific components of patient safety include the assessment, identification, classification, management, analysis and reporting, as appropriate, of medical/health care associated adverse events (to include sentinel events). Patient safety addresses incidents involving potential harm (close calls) to patients as well as those in which actual injury occurred (adverse events).

(3) Pursuant to AR 40-68, a representative from the ACO or CPO is informed by the risk management team of all adverse, sentinel, or potentially compensable events and participates in their management, AR 40-68, paragraph 12-4c(3) . See AR 40-68, chapter 12 and 13 to determine the nature and extent of the role of the CJA. All requests for medical records from the injured patient or their representative arising from a PCE or claim will be referred to the CJA for reply, AR 40-68, paragraph 13-6a .

c. Medical records. One of the problems medical malpractice cases present is that health care providers (HCPs) store much of the pertinent evidence and documents (equipment, personal notes and letters, journal article drafts, computer data, pathology material) for only short periods. Furthermore, MTFs often maintain clinics at many different locations within their confines or their satellite facilities. Always request a printout from the Composite Health Care System (CHCS) records listing all visits, telephone consultations, lab procedures, etc. that the patient has had at a given hospital. The CHCS is integrated software for administrative and clinical information in use at DOD hospitals. Thus, the first goal of any medical malpractice investigation should be to locate, retrieve and safeguard all data and items associated with the patient's treatment. See the Sources of Medical Records Table posted on the USARCS Web site at "Claims Resources," II, a, no. 18.

d. Working relationships. To facilitate the investigation of a medical malpractice claim, the ACO or CPO should have a working relationship with the MTF staff. The importance of direct access to hospital personnel (Deputy Commander for Clinical Services, Chief of Nursing, Chief of Patient Affairs Division, Quality Improvement Coordinator, Risk Manager and chiefs of major medical departments) cannot be overstated. The representative from the ACO or CPO as part of the risk management team (see AR 40-68, chap 3 ) should visit frequently to determine if any incidents have occurred. The representative should attend all QA Committee meetings as a non-voting member. On an occasional basis, the representative should attend morning report meetings. Such participation is necessary to learn of potential claims and commence early investigations. Claims personnel should not participate in any credentialing action because it is potentially a conflict of interest.

e. Identifying a potentially compensable event.

(1) The following are signals that may identify a PCE:

(a) Unexpected or unexplained death.

(b) Unexplained paralysis of any extremity.

(c) Coma.

(d) Any neurological damage that results in unexplained brain insult (brain damage).

(e) Loss of any sensory ability: hearing, sight, taste, smell or touch.

(f) Disfigurement resulting from chemical or electrical burns.

(g) Unexplained loss of sexual function.

(h) Unexplained loss of bladder or bowel control.

(i) Unexplained loss of any body part.

(j) Unexplained seizure activity.

(k) Any infant born with an APGAR score of less than four at one minute or less than six at five minutes.

(l) Any patient who dies within 24 hours after discharge from the MTF or emergency room.

(2) If the ACO or CPO learns of a PCE during an RM meeting or from a DA 4106 or other reporting system within the MTF, it should ensure that the PCE is informally investigated and the medical records secured. If the incident is serious, advise the AAO by the most expeditious means.

f. Preservation of evidence. As an investigation begins, the ACO or CPO must obtain and secure all relevant evidence, including all medical and pharmacy records, physician notes and orders, convenience files, laboratory results, X-rays, scans, and fetal tracings. See the Sources of Medical Records Table, posted on the USARCS Web site at "Claims Resources," II, a, no. 18. This evidence may be preserved through coordination with the Chief of the Patient Affairs Division. It should be stored in a separate locked container with the notation that the consent of the ACO or CPO is needed prior to retirement, destruction, transfer or release.

(1) The best evidence consists of contemporaneous notes, special studies and documents created at the time the treatment was provided. Such evidence is crucial because it reflects the physician's impartial impressions and care plan.

(2) The ACO or CPO should request the Patient Affairs Division in writing and in specific detail to sequester and preserve the necessary evidence and to submit copies of the medical records. See AR 40-68, chapter 13 .

(3) Furnish a copy of the MTF records to claimant's counsel who should in turn furnish a copy of all civilian medical records and names of civilian treating facilities and physicians. If counsel responds to the request for civilian records by claiming that the expense is too great, obtain a release or permission to obtain such records (see the medical release forms posted on the USARCS Web site at "Claims Resources," II, c). If the civilian records are lengthy, the ACO or CPO should review them to determine which are necessary. Funds to purchase civilian records should be available locally.

g. Records review and analysis.

(1) Once the medical records have been obtained, review each page, outlining the dates of each treatment received, and create a detailed written chronology. These records contain many abbreviations unique to the medical field; AR 40-66 provides a list of authorized abbreviations. Often, the records will contain unauthorized abbreviations. If the records contain unauthorized abbreviations or the handwriting is illegible, request the HCP who prepared the record furnish a legible version. The chronology should include the patient's medical condition, the date and type of treatment rendered, and the name of the treating HCP(s). These entries may reveal gaps in the patient's treatment and provide clues to any civilian treatment not disclosed by the claimant or any visits omitted.

(2) Prepare a witness list containing the names of HCPs, their current and permanent addresses, and telephone numbers for present residence and permanent home of record. Obtain their expiration term of service or permanent change of station (PCS) dates. Service and department chiefs and their secretaries, the QA committee, the Graduate Medical Education Office, the relevant corps branch office (Medical Corps, Dental Corps, Nurse Corps, Medical Service Corps), the college or professional school from which they graduated, and the American Medical Association may prove helpful in locating HCPs.

h. Identifying healthcare providers. Establish each HCP's role in the patient's treatment. Was the HCP following the orders of another, such as a senior HCP? When was the medical care actually provided? Often, a senior medical staff member stays behind the scenes but actually directs and oversees the patient's treatment through the ward staff: the residents, interns, fellows, medical students, and registered nurses. Many times the senior medical officer will not write notes in the patient's chart and, if surgery occurs, will not even be listed as present in the operating room. This practice permits junior trainees to receive credit for performing medical procedures when they later seek board certification.

(1) Employment status. Determine the HCP's employment status: government employee (active duty or civilian), personal services contractor under 10 U.S.C. § 1089, independent contractor, TRICARE provider or civilian consultant.

(2) Documentation. If the HCP is not a government employee, obtain copies of these documents: credentials file, contract or partnership agreement, and certificate of insurance. See paragraph 2-45c .

(3) Notification to insurance company. Notify the HCP's insurance company that the claim has been filed, and where indicated, that the United States is not liable for their insured's conduct. Establish the existence of any third-party liability insurance. See paragraph 2-58 (subrogation).

(4) Notification to claimant. Inform the claimant's attorney if the HCP is not a federal employee. Provide the attorney with information pertaining to the HCP's insurance company. Be sure to inform the claimant's attorney as soon as possible, particularly before the applicable state statute of limitations has run. Failure to do so will leave the claimant with little choice but to sue the United States to force a third-party action. Also, if the claim goes to suit, it may lead the claimant to assert that the government should be equitably estopped from invoking the independent contractor defense because it concealed or otherwise failed to reveal the status of the non-federal employee until the state statute of limitations had run. Where the HCP is employed as a personal services contractor, 10 U.S.C. § 1089 states that individual liability insurance is not required, but if the agency that furnished the personal services contract has insurance inform the claimant's attorney.

(5) Ex-parte provider interviews. Military and DOD treating physicians are federal employees and may be interviewed without the claimant's consent. However, before conducting an ex-parte interview of a TRICARE HCP or an independent contractor, research applicable state law. Some states deem the filing of a lawsuit to waive the plaintiff' s physician-patient privilege, others require the plaintiff's consent before the physician may be interviewed. When researching, determine whether the state considers filing an FTCA claim analogous to filing a lawsuit. If the state law seems to favor claimant's position or is not clear, inform claimant's counsel that the claimant must sign a release allowing you to interview the HCP, that the claim cannot be investigated and processed without such a release and that you will provide them with a copy of a written summary of the interview.

i. Media requests. Any and all communications with the media concerning a sentinel event, adverse advent or significant patient safety issue will be coordinated by the local public affairs office with the CJA. Press inquiries and other media related issues will be referred by the local public affairs office, as appropriate, to: USAMEDCOM, Attn: MCPA, 2050 Worth Road, Fort Sam Houston, Texas 78234-6000.

j. Use of quality assurance investigations. Claims personnel, because they are DOD employees whose duties require it, have access to QA records. See 10 U.S.C. § 1102. These documents should always be obtained and made part of the file. But a claims office should never substitute QA investigations for a thorough claims investigation. A QA report or investigation sometimes provides insight into the medical care provided, potential witnesses' names, and other leads or helpful directions. It may be necessary to re-interview witnesses and cover the same ground. Quality management, and involvement in it and access to it, of legal and claims personnel are covered fully in AR 40-68 . See paragraph 1-18 .

k. Research of a medical malpractice claim. Claims personnel should read and become familiar with the standard treatment approaches to the claimant's original medical problem. Through such study, the ACO or CPO may learn that there is more than one acceptable treatment. This issue bears on the physician's medical training, judgment, and length of time served as a clinician. Typically, every medical problem may be met with several valid and equally acceptable treatments. The primary physician may use a technique that is different from, but as valid as, the treatment another physician uses or recommends. If a particular technique is accepted in its medical specialty, the question of the best, most appropriate treatment comes down to one of medical judgment, not substandard care. The ACO or CPO must conduct research and interview witnesses and experts to establish the standard of practice in the particular medical field. More importantly, there is an acceptable percentage-of-failure rate for most medical procedures. Use the acceptable failure or complication rate as a guide to which methods of treatment usually lead to undesirable results. These rates are based on treatment experience, the physician's technical ability, training and experience level, and the physician's own percentage of failure based on the number of cases actually handled in the past. The goal here is to discover the standard of care and determine whether the outcome in claimant's case was due to inherent treatment risks or to HCP negligence. There are several methods by which the ACO or CPO may spot problems with the care provided.

(1) Standard medical textbooks and journal articles. Be familiar with current medical textbooks, journal articles and other relevant literature before interviewing witnesses. These resources will help establish the standard of practice for a particular medical problem. Furthermore, they will also provide failure and complication rates and different but acceptable results of a particular medical procedure. Use the local MTF's medical library.

(2) Physicians' Desk Reference. The Physicians' Desk Reference is the standard text that medical professionals use as a prescribing source or guide for the thousands of pharmaceutical products licensed and approved by the Food and Drug Administration. It provides information on prescribing, risk and complications, adverse reaction warnings and symptoms, treatment for overdose, drug interactions, and contraindications to use.

l. Medical malpractice claims deriving from defective drugs, medical equipment or devices.

(1) Timeliness. Timely investigations are important when equipment fails to perform properly or a drug is mislabeled or mistaken for another with a similar name or package. Often, items are designed to be discarded after a single use. They may be lost or destroyed if claims personnel fail to involve themselves immediately upon learning of an injury. The injury should be reported on DA 4106 to the head of the medical department or service within 24 hours of the occurrence and to the risk manager within 48 hours. Upon receiving a DA 4106 or discovering the PCE by other means, the ACO or CPO should immediately secure the drug, equipment or device.

(2) Necessary procedures. When equipment fails (for instance, a needle snaps, a catheter breaks off subcutaneously, or an equipment item shocks, burns or injures a patient in any way), the claims investigator, after obtaining the equipment or device as rapidly as possible obtains and secures the MTF's Medical Equipment Division's maintenance records; the technical manuals for the operation of the equipment in question; the suggested maintenance schedule; and the manufacturer's sales brochures describing recommended uses. The claims investigator must interview the staff involved when the equipment failed to establish exactly how they were using it, for what purpose, and if there was an electrical power surge or failure at the time. The investigator should try to establish if the patient and equipment were properly grounded, if the equipment was being used as the manufacturer suggested, if the MTF staff put the manufacturer on written notice of the equipment's failure and of a patient's resultant injury, and if the Food and Drug Administration or the U.S. Army Medical Research and Development Command were notified of such failures or issued past warnings or recalls. The investigator should arrange for an independent analysis and invite the manufacturer to join in the analysis.

(3) Notice and inspection. Place the supplier and manufacturer on notice. Invite inspection of the equipment or device. Do not furnish the item for inspection or repair but maintain a chain of custody. If the MTF has modified the equipment notify the supplier and manufacturer. Obtain an expert to determine whether the failure was due to design or operation and what role modification played.

m. Use of medical experts in medical malpractice claims. See paragraph 2-48 . To investigate and evaluate a medical malpractice claim properly, an ACO or CPO must discover the standard of care in a particular situation. Establishing the standard of care, common treatment outcomes, and failure rate percentage of such treatments is key to the investigation.

(1) Having a qualified medical provider within the appropriate medical specialty at the MTF involved review the records is a good starting point for determining the standard of care. Such review is helpful because the reviewing physician works at the MTF where the ACO or CPO is assigned. The reviewing physician can explain the condition's correct diagnosis and its proper treatment, the complications associated with each type of treatment, and which complications are considered unusual or unexpected, all information that the ACO or CPO needs to spot the key issues requiring in-depth investigation and analysis. Although such lateral review is helpful, the ACO or CPO should bear in mind that physicians working within the same MTF sometimes avoid criticizing each other.

(2) In conjunction with the AAO, the ACO may hire a civilian expert in the manner set forth in AR 27-20, paragraphs 2-21 or 2-24 of this publication. The expert should be recognized by peers as an authority and should be willing to testify in the event of suit. Claims personnel should obtain an expert opinion in response to written questions. Such expert opinion may be used to attempt a compromise or to convince the claimant to withdraw the administrative claim. This is indicated especially when conflicting expert opinions confront the claims reviewer.

n. Interviewing health care providers in medical malpractice claims. The objectives of an HCP interview are not unique —

(1) Obtain the witness' curriculum vitae, training and experience levels, number of procedures performed, and educational courses taken to qualify to perform the procedure in question. Establish the HCP's role in the patient's treatment, review the sequence of events (facts) leading to the injury, and learn the HCP's opinion of how or why the injury occurred.

(2) Witness interviewing sequence is extremely important because you must identify and interview the primary witnesses. You may want to interview the nursing staff first to establish the general facts and sequence of events and to identify the "key players" involved in the incident.

(3) Establish each medical staff member's role during the interview. What was the person's role in the patient's clinical treatment? Was this person following orders of another more senior person while treating the patient? When interviewing a medical witness, always try to identify all members of the treatment team on the ward, in the operating room or in a clinic treatment office.

(4) Each witness may have a unique perception of the facts. Remember that he or she can greatly assist claims personnel if approached correctly and treated with respect. The facts are best told in narrative form, but if the witness is unable to recall the events, the investigator must still obtain the witness' view of the facts. Insist that the witness review the standard of care and state if he or she thinks it was met. Keep in mind that in some medical malpractice cases, investigators may need to interview primary witnesses two or more times. This is not unusual when many people play different roles in the normal course of treatment. Someone who at first does not appear significant may provide critical data that requires re-interviewing the other witnesses; doing so may be the only way to establish, or flesh out, all the essential facts.

o. Preparing for the healthcare provider interview.

(1) Preliminary actions.

(a) Before the interview, review the chronology you have prepared.

(b) Review the applicable standard of care previously established.

(c) Review the HCP's credentials file. A credentials file documents a physician's training and licensure as well as practice privileges that have been granted by the MTF. Similar documents for residents are obtainable from the MTF graduate medical education office or the director of the particular resident's training program. Determine whether any restrictions have been imposed. Review the file and, if indicated, the HCP's own medical records for other factors which might impede or affect the provider's ability to perform (such as visual handicap, lack of fine motor coordination, existing neurological conditions or substance abuse problems).

(d) Make sure that the HCP has had time to review the medical records and notes before the interview. Have two copies of the records present during the interview.

(2) Conducting the interview.

(a) Explain your role and the purpose of the interview. Tell the HCP that accuracy and honesty are crucial in determining the claim's merits. The medical records must always be present during the interview.

(b) Take notes during the interview and prepare a memorandum based on them after it concludes. Have the HCP review the memorandum. Do not create a verbatim recording of the interview or have the HCP provide a signed written statement.

(c) Discuss the HCP's experience in the medical field involved, such as the number of procedures he or she had performed (with and without assistance) before the incident.

(d) Have the HCP explain in narrative form all direct involvement with the patient and the medical care at issue. Prepare a specific list of open-ended questions designed to elicit the HCP's broadest response.

(e) After the HCP commits to one version of the facts, review the data set forth in the medical records with the HCP, such as:

(1) How often did the HCP visit or attend the patient?

(2) Why are certain visits not recorded?

(3) What complaints did the patient present with at each visit and were these complaints recorded in the records?

(4) Why are there conflicts between what the HCP states and the contemporaneous notes in the records?

(5) What was the HCP' s day-to-day involvement with the patient?

(f) Determine what treatment choices the treating medical staff considered. Determine whether it requested and obtained consultations with other departments. If so, discover who the consultants were and what treatment they recommended. If not, why were necessary consultations not obtained? You must also find out what the physician-witness told the patient about the latter's medical condition, treatment choices, and the expected treatment results. Did the physician tell the patient, in detail and in language the patient could understand, about the treatment choices and their known risks and complications?

(g) Ask about the HCP's own health at the time of treating the patient.

(h) Ask the HCP whether the Army should defend or settle the claim based on the medical records. The HCP should explain his or her involvement in the case and all interactions with other involved HCPs. Ask questions to clarify the events. Always allow the HCP to review the allegations stated on the claim form and any expert opinions the claimant has offered. Ask the HCP to comment about both the allegations and the claimant's expert medical opinion, if any. The HCP may make valid points about either or both, and these comments may in turn assist in the overall defense of the case.

(i) Establish what counseling the patient received, when and by whom, and what subjects were discussed with the patient.

(j) Avoid these situations:

(1) Arguing with or confronting the witness.

(2) Leading the witness rather than asking who, what, when, where, and why questions.

(3) Failing to ask hard or tough questions (for example: Why didn't you do anything about the patient's elevated white blood count?)

(4) Failing to prepare properly for the interview; not knowing the right terms or not understanding the medical records.

(5) Not knowing the medical background (for example, normal values for blood chemistry, such as a complete blood count), subject matter, or treatment standards involved and not reviewing general medical texts and articles before conducting the interview.

(6) Allowing the witness to respond at great length and not asking the witness to separate or break down the answer into understandable segments.

(7) Allowing the witness to respond in "medicalese" and not asking the witness to explain the subject involved in plain, easily understandable English.

(8) Failing to understand the witness' answer but not asking for clarification.

(9) Failing to ask follow-up questions.

(10) Letting the witness intimidate you.

p. Documenting the opinion. Obtain copies of any personal notes and research the HCP's files on the patient. Also request copies of:

(1) MFRs concerning treatment or discussions with the patient or patient's family.

(2) Letters to and from civilian consultants used by the treating physician concerning the patient.

(3) Photographs, slides and/or videotapes of the patient's condition before and after treatment or procedure performed (such as a videotape of an endoscopy or photographs of the patient before and after plastic surgery).

(4) Personal computer files containing progress notes, personal notes, MFRs and drafts of medical journal.

(5) Articles from magazines, journals, or the Web pertinent to the topic.

Section V
Determination of Liability

2-35. Basic information on liability

AR 27-20 does not provide a remedy for every claim that may be brought against the government. A prompt and thorough investigation of all the facts is the key to properly assessing liability in any claim. Even if an unsophisticated claimant or an incompetent attorney advances a meritless argument, the facts may indicate governmental liability on some other basis. Apply the entire law of the place where the act or omission occurred, including its choice of law rules, to determine liability and damages. In certain circumstances, the legal theory of depecage will permit application of the law from a state other than where the incident arose on certain issues in a given claim. For example damages could be determined by the law of one state and who is a proper claimant could be controlled by the laws of another state. However, in the typical FTCA case, law of the situs of the incident usually applies to the determination of duty, breach of that duty, and causation. In small-value claims, determining the damage award is more likely to involve the law of the place of occurrence than the law of the place where the claimant currently resides. Where local law conflicts with federal statutes, the latter govern. In assessing the government's liability, it is important to remember that federal statutes and common law as well as state law may bar the claim or provide governmental immunity. Consider these issues when assessing the standard issues of duty, breach, causation, and damages. Additionally, where liability is not clear or the facts remain uncertain, consider compromise settlements. Compromise is particularly important in MCA claims, as the parties cannot litigate contested issues.

2-36. Constitutional torts

Claims for violations of constitutional rights are not cognizable under any chapter of AR 27-20. The FTCA holds the United States liable to the same extent as a private person would be according to the law of the place where the act occurred. The "law of the place" refers to state law, and state law cannot impose liability for the violation of federal constitutional rights. Therefore, constitutional wrongs cannot be remedied through the FTCA unless the alleged violation also constitutes a state tort, Federal Deposit Ins. Corp. v. Meyer, 510 U.S.C. 471 (1994). Specific types of claims to be analyzed in this regard may include:

a. Bivens-type actions. Suits alleging violation of constitutional rights may be brought against U.S. employees individually, Bivens v. Six Unknown Named Agents of the Federal Bureau of Narcotics, 403 U.S. 388 (1971). See FTCH § II, B1b. The Federal Employees Liability Reform and Tort Compensation Act, 28 U.S.C. § 2679(b), provides absolute immunity from individual suit for employees of the United States acting within the scope of their employment; commonly known as the Westfall Act but part of the FTCA. This statute specifically excludes from FTCA coverage any civil action against a government employee "brought for a violation of the Constitution of the United States" or "for a violation of a statute of the United States under which such action against an individual is otherwise authorized," 28 U.S.C. § 2679(b)(2)(A) and (B). However, federal officials performing discretionary functions continue to have qualified immunity from liability as long as the officials' conduct did not "violate clearly established statutory or constitutional rights of which a reasonable person would have known," Harlow v. Fitzgerald, 457 U.S. 800 (1982); Davis v. Scherer, 468 U.S. 183 (1984); Mitchell v. Forsyth, 472 U.S. 511 (1985); Anderson v. Creighton, 483 U.S. 635 (1987). The affirmative defense of qualified immunity is a judicially created doctrine spurred largely by the rise of suits against public officials under 42 U.S.C. § 1983 (holding public officials liable for violations of an individual's constitutional or federal statutory rights as a result of actions taken under color of state law). Additionally, the Westfall Act does not preclude suit against an HCP under the Gonzales Act (10 U.S.C. § 1089 (b)). For example, if an HCP acting within the scope of employment commits an excluded tort such as an assault or false imprisonment, the HCP may be sued individually despite the Westfall Act. However, in view of the provision of the Gonzales Act permitting suit against the United States for willful torts of HCPs, a suit against the United States rather than the individual HCP is likely. The Gonzales Act is discussed further at paragraph 2-39h , " Intentional Torts ." See FTCH § II, B1b and D1b(3) for case law.

b. Property damage and confiscation. Neither takings under the Fifth Amendment of the U.S. Constitution nor contract claims are cognizable under the FTCA.

(1) The Fifth Amendment to the U.S. Constitution provides in part ". . . nor shall private property be taken for public use without just compensation." The Tucker Act, 28 U.S.C. § 1346(a), provides exclusive jurisdiction in the Court of Federal Claims over causes of actions alleging property loss caused by a Fifth Amendment "taking." Such takings include inverse condemnation actions. See FTCH § II, B5c. AR 27-20 provides no basis for paying these claims; refer them to USARCS immediately. Investigate the facts of the claim thoroughly before referring it because often it is difficult to determine if there was, in fact, a taking (either temporary or permanent) or if the property was damaged by a tort or noncombat activity. See FTCH § II, B5c(3). Real estate claims based on a Fifth Amendment taking include navigation easements and claims caused by a continuous invasion of property, such as overflight noise or smoke, gases or water emanating from government sources. See United States v. Causby, 328 U.S. 256 (1946), and Griggs v. Allegheny County, 369 U.S. 85 (1962) (both involving overflights). The Court of Federal Claims has exclusive jurisdiction of Tucker Act claims in excess of $10,000. If the claimed amount is less than $10,000, suit may be filed in the appropriate U.S. District Court or the Court of Federal Claims. See paragraph 2-17h(1) .

(2) Contractual claims for rent, janitorial, custodial, utility and other contractual services; damage to real property sounding in express or implied-in-fact contract, and permanent or recurring damages to real property resulting in a government "taking" of an interest in the real estate may also be investigated and settled under AR 405-15 . See AR 27-20, paragraph 3-3b . The COE is the Army agency that maintains liaison with the OMB for settlement of real estate claims sounding in contract. Claims based upon contract theory, either express or implied, have a six-year statute of limitations, 28 U.S.C. §§ 2401 and 2501. An implied-in-fact contract theory may be used to pay a maneuver damage claim presented after the MCA' s two-year statute of limitations has expired. See paragraph 2-15m .

(3) Exclusive jurisdiction over intangible property losses rests with the Court of Federal Claims. Refer claims for such damage based on mistakes made by administrative personnel to the OMB (31 U.S.C. § 3702) as Tucker Act claims.

2-37. Incident to service

See parallel discussion at AR 27-20, paragraph 2-26 .

a. Feres-type bar. A claim for the personal injury or death of, or the loss of or damage to property belonging to, a member of the Armed Forces of the United States that occurs "incident to service" is not payable under the FTCA, Feres v. United States, 340 U.S. 135 (1950). Additionally, the MCA expressly bars claims for personal injury to, or death of, a member of the Armed Forces or Coast Guard occurring outside the United States and "incident to service," 10 U.S.C. § 2733(b)(3); however, the MCA does permit recovery for property damage claims. The courts interpret "incident to service" very broadly; this concept is far greater in breadth than is "acting within the scope of one's employment."

b. Rationale. Here is a current list of significant justifications federal courts invoke to uphold the Feres or "incident to service" doctrine:

(1) The distinctively federal nature of the relationship between the government and members of its armed forces, which argues against subjecting the government to liability based on the fortuity of the situs of the injury.

(2) The availability of alternative compensation systems, such as military pay and benefits, including medical disability and retirement.

(3) Fear of disrupting the military command relationship, United States v. Johnson, 481 U.S. 681 (1987).

(4) Such factors as the Soldier's duty status, the location of the incident, what the claimant was doing at the time of the incident and the Soldier's access to a benefit not generally available to the public at the time of the incident (such as medical treatment at a federal facility, use of the post exchange or commissary or space available flights). See FTCH § I, E10.

c. Type of Investigation. All "incident to service" cases must be investigated in a timely fashion to determine the Soldier's exact status at the time of the incident, how much control the military service exercised over the action or conduct, and when and under what circumstances the alleged negligent act or omission occurred. Note that obvious facts such as whether the Soldier was on or off duty, or located on or off post, are not triggers for or against immunity: this exception does not operate automatically under any circumstances. Variations in case law demand detailed investigation of each claim. Compare Parker v. United States, 611 F 2 d 1007 (5th Cir. 1980) with Thomason v. Sanchez, 398 F. Supp. 500 (D.N.J. 1975), aff' d 539 F.2 d 955 (3d Cir. 1976), cert. denied, 429 U.S. 1072 (1977) and Warner v. United States, 720 F.2 d 837 (5th Cir. 1983).

d. Persons included. The "incident to service" exception bars claims by members of the Army, Navy, Air Force, Marine Corps, Coast Guard and Public Health Service, including the Reserve components of the armed forces and National Guard. It applies also to Soldiers on convalescent leave, the extended enlistment program or the delayed enlistment program, to service academy cadets, military prisoners serving a sentence whether or not the discharge has been executed, and to members of visiting forces present in the United States under the NATO SOFA or similar international agreements. Currently, the question whether the "incident to service" exclusion applies to Soldiers on the temporary disability retirement list (TDRL) remains unsettled. The federal circuit courts of appeal are divided on the issue, Kendrick v. United States, 877 F.2 d 1201 (4th Cir. 1989), cert. dismissed, 493 U.S. 1065 (1990), and Ricks v. United States, 842 F.2 d 300 (11th Cir. 1988), cert. denied, 490 U.S. 1031 (1989) (held: Feres bar applied); contra, Harvey v. United States, 884 F.2 d 857 (5th Cir. 1989), and Cortez v. United States, 854 F.2 d 723 (5th Cir. 1988) (held: Soldiers on the TDRL are not barred by Feres). Where the claim is based on continuation of medical treatment or a medical condition which occurred while the Soldier was on active duty, the claim is excluded. Otherwise, the disposition of the claim depends on the law of the applicable circuit court. FTCH § I, E10x. The "incident to service" rule does not bar a veteran's claim if the tortious act occurred after the claimant retired from military service.

e. Claims barred. The "incident to service" doctrine bars constitutional and intentional tort claims brought by Soldiers against the United States (FTCH § I, E10y), suits brought by one Soldier against another, or against a federal civilian employee, and third-party indemnity claims brought against the United States (FTCH § I, E10x).

f. Medical malpractice. If medical care is provided based on an individual's military status, a claim for medical malpractice will be barred by the "incident to service" doctrine. This doctrine has been held to bar suit for negligent medical examination at a pre-induction physical provided the applicant is subsequently enlisted or inducted; if the applicant is not sworn in, Feres will not apply. The doctrine has also been held to bar a claim for a post-service injury as a result of a negligent or wrongful act which occurred while the Soldier was on active duty, for example, failure to warn or to provide followup care. However, if an independent negligent act occurred after the Soldier retired, then the "incident to service" doctrine will not bar the claim.

g. Derivative claims. The "incident to service" doctrine has been extended to bar derivative claims where the directly injured party is a Soldier, FTCH § I, E9c. The doctrine has also been held to bar suits by Soldiers' dependents if the claim has its "genesis" in a service-related injury, for example, injuries caused by Agent Orange and World War II radiation exposure, because the Soldier' s service-related injury is the basis for the claimant's injury. A Soldier may bring a derivative claim for injuries to a spouse or family member as long as those injuries were not incurred incident to the spouse's or family member's own service.

h. Prenatal care. Feres does not bar a claim by or on behalf of a fetus (miscarriage or stillbirth) or an infant (live birth) based on negligent prenatal care provided to the Soldier-mother or negligence at the time of delivery. Feres does bar a claim by the Soldier-mother for her own injury resulting from such care, including prenatal care. Care provided to the mother alone must be distinguished from care provided to both the mother and the fetus. For example, the administration of the antiemetic drug Bendectin to prevent nausea constitutes care of only the mother. Discuss claims involving prenatal or perinatal injuries to fetuses or infants of active duty mothers with the AAO.

i. Temporary Disability Retirement List (TDRL). The courts have carved out an exception where independent post-discharge negligence (such as failure to monitor, warn or report a diagnosis) or a direct injury to a military dependent while on TDRL status violates a continuing duty owed to the Soldier, FTCH § I, E10p. United States v. Brown, 348 U.S. 110 (1954); Laswell v. Brown, 683 F.2 d 261 (8th Cir. 1982), cert. denied, 459 U.S. 1210 (1983); and Molsbergen v. United States, 757 F.2 d 1016 (9th Cir. 1985), cert. dismissed, 473 U.S. 934 (1985). The courts have reached dissimilar results in similar cases when the facts differ. Feres may also bar third-party indemnity claims and Soldiers' claims against United States contractors where the "government contractor" defense is viable, Stencel Aero Engineering Corp. v. United States, 431 U.S. 666 (1977).

2-38. Federal Employees Compensation Act and Longshore and Harbor Workers Compensation Act claims exclusions

See parallel discussion at AR 27-20, paragraph 2-27 .

a. Persons included. All federal civilian employees, except for NAFI employees, are entitled to receive workers' compensation coverage under the FECA, 5 U.S.C. §§ 8101-8193. The FECA defines who is considered a federal employee (5 U.S.C. § 8101). In addition, special legislation has extended FECA coverage to Peace Corps and Vista volunteers, federal petit or grand jurors, volunteer members of the Civil Air Patrol, Reserve Officers Training Corps Cadets (Senior ROTC) (5 U.S.C. § 8140), Job Corps and Youth Conservation Corps enrollees, certain nurses, interns or other health care personnel, such as student nurses (5 U.S.C. §§ 5351, 8144), and state or local law enforcement officers engaged in apprehending persons charged with committing crimes against the United States (5 U.S.C. § 8191). FECA coverage applies to temporary federal employees, covered on the same basis as permanent employees, and contract employees; volunteers and loaned employees may be covered under certain circumstances. Federal employment is a question of federal law. See FTCH § I, E9c.

b. Applicability of the Longshore and Harbor Workers Compensation Act to Nonappropriated Fund Instrumentalities employees. Civilian employees of nonappropriated fund (NAFI) activities of the United States receive workers' compensation coverage under the Longshore and Harbor Workers Compensation Act (LSHWCA), 5 U.S.C. § 8171; 33 U.S.C. §§ 901-950. The LSHWCA contains compensation and exclusivity provisions similar to those of the Federal Employees Compensation Act (FECA). The same regional offices that consider FECA claims consider LSHWCA claims. See FTCH § I, E9e.

c. Applicability of the Longshore and Harbor Workers Compensation Act and Federal Employees Compensation Act to certain federal civilian employees. Federal civilian employees who are not citizens or residents of the United States, such as foreign nationals hired in a foreign country, may be covered by FECA and LSHWCA, subject to certain provisions governing their pay rates. Compensation payments are calculated under international agreements and command directives that provide compensation benefits when such employees are injured as a result of the performance of their duties. If neither FECA nor LSHWCA applies or if the benefits permitted under international agreements and command directives are not an exclusive remedy, such persons' claims may be considered under the FCA or the MCA. The CJA or claims attorney or officer should make appropriate deductions, however, for payments from any other sources.

d. Actions upon receipt of a Federal Employees Compensation Act or Longshore and Harbor Workers Compensation Act cognizable claim. When a tort claim for personal injury or death is filed by or on behalf of a person who is listed in subparagraphs a , b , or c the claimant should be advised to file a claim with the Office of Workers Compensation Programs for the region where the claim arose (see subpara f ) if the injury or death arose in the performance of duty. The OWCP is the arbiter of whether an injury is cognizable under the FECA or LSHWCA, regardless of whether an award is made. If an employee or the survivors disagree with a final determination of the Office of Workers' Compensation Programs (OWCP), they may request a hearing, where the claimant may present evidence in further support of the claim. Also, the claimant has the right to appeal to the Employees' Compensation Appeals Board, a separate entity of the U. S. Department of Labor, and OWCP may review a case on its own initiative.

e. Actions when claim has already filed with Office of Workers' Compensation Programs. If the claimant has already filed with OCWP, and is receiving benefits, the tort claim should be denied as FECA OR LSHWA is the exclusive remedy against the U.S. If not, the claimant must file with the OWCP and final action on the tort claim will be held in abeyance until one of the following occurs at which time the tort claim will be denied.

(1) The OWCP determines that the claim arose out of the performance of duty

(2) The OWCP denys the claim because the claimant refuses to furnish documentation or otherwise cooperate.

(3) The claimant refuses to appeal the OCWP denial despite the Army settlement authority's request because of his determination that the claim is properly under FECA or LSHWCA.

(4) The claimant fails to file within the applicable three year statute of limitation.

f. Where to file Federal Employees Compensation Act or Longshore and Harbor Workers Compensation Act claims. Claims for personal injury or wrongful death under the FECA are considered by regional offices of the OWCP, Department of Labor. A listing of all of the regional offices for federal employees workers' compensation programs can be found on the USARCS Web site at "Claims Resources," II, no. 21. Its New York regional office considers most claims arising outside the United States. Initial determinations may be appealed administratively but DOL's provision or denial of benefits is final and its determination that a FECA claim is barred is not judicially reviewable. Federal case law is determinative. See FTCH § I, E9f. If there is a substantial question whether or not the FECA covers a claimed injury, and if the civilian employee or legal representative did not file a claim under FECA before filing an FTCA or MCA claim, advise the claimant immediately to file a FECA claim. If the claimant insists on pursuing an FTCA or MCA claim, then consult the AAO, who will coordinate with the Office of the Solicitor, Department of Labor. If a FECA claim is pending, final action on the FTCA or MCA claim should be held in abeyance pending a determination by the OWCP regarding the claimant's entitlement to benefits under FECA.

g. Negligence not required. The FECA provides compensation if the federal employee, located either in the United States or overseas, is killed or injured "while in the performance of . . . duty." As in many workers' compensation schemes, the employee may recover damages whether or not there is government negligence, and the employee's own (contributory) negligence does not bar recovery. In cases where it applies, FECA is the employee's exclusive remedy against the United States and bars any claim under the FTCA or MCA, Johansen v. United States, 343 U.S. 427 (1952); United States v. Demko, 385 U.S. 149 (1966); 5 U.S.C. § 8116(c); AR 27-20, para 2-39c ; 10 U.S.C. § 2733 (b)(3); FTCH § I, E9, including both the civilian employee's direct claim and all other parties' derivative claims. See FTCH § I, E9d. The FECA bar does not extend to third-party claims for indemnity or contribution, Lockheed Aircraft Corp. v. United States, 460 U.S. 190 (1983). Subsequent cases have limited Lockheed's application, however. See FTCH § I, E9h. The FECA bars only federal civilian employees' personal injury and wrongful death claims, not their property damage claims. Therefore, consider their meritorious property damage claims first under AR 27-20, chapter 11 , and then under AR 27-20, chapter 4 , or Chapter 3 for claims arising outside the continental U.S. (OCONUS).

h. Scope of employment. Coverage under the FECA and LSHWCA is contingent upon a determination whether or not the personal injury or wrongful death occurred while the federal employee was in the performance of duty or acting within the scope of employment.

(1) The Department of Labor makes this determination under the FECA in accordance with federal case law. However, the law of the place of the occurrence is applied to claims arising under LSHWCA. Generally, if the employee is injured on agency premises during working hours, the FECA and the LSHWCA will apply, unless the employee was engaged in an activity that is obviously outside the scope of employment.

(2) "Agency premises" include areas immediately outside a building or place of employment, such as steps or sidewalks, if these areas are federally owned and maintained, and any parking facilities that the agency owns, controls or manages. Coverage applies also to workers who perform services away from the agency's premises, such as drivers or messengers. It extends to workers sent on errands or special missions or who perform services at home. Employees who are present on the premises for a reasonable time before or after working hours are covered; the coverage does not extend, however, to employees who visit the premises for non-work-related reasons. Additionally, employees who are killed or injured en route between work or home are not covered, except when still on the premises (or military installation) or when the agency has furnished them transportation to and from work.

(3) Coverage extends to injuries that occur while the employee was performing assigned duties or engaging in an activity reasonably associated with the employment, including using facilities for employee's comfort, health and convenience as well as eating meals and snacks provided or available on the premises.

(4) Injuries occurring off the agency premises or installation during a lunch period are not ordinarily covered unless the employee is in a travel status or is performing regular duties off premises. Employees in travel status are covered 24 hours a day for all activities reasonably incident to their TDY; an employee injured while on a sight-seeing trip during TDY may not be covered.

(5) Employees are covered while engaged in officially organized recreation authorized as part of their training or assigned duties.

(6) An employee's intentional or willful misconduct or intoxication with alcohol or drugs may be grounds for denying FECA or LSHWCA coverage. If the factual and medical evidence indicates, however, that the employee was not in full possession of his or her faculties at the time of the act, the injury may be compensable. Suicide may thus be covered under FECA or LSHWCA if it results from a mental disturbance or physical condition arising from the performance of duty that produces a compulsion to commit suicide and prevents the employee from exercising sound discretion or judgment sufficient to control the compulsion. See FTCH § I, E9c.

i. Subsequent injury. FECA and LSHWCA coverage extends not only to the original duty-related injury but also to any subsequent injury which results from medical care or treatment received for the original injury. Therefore, FECA and LSHWCA may bar medical malpractice claims when the medical care or treatment was provided for a duty-related injury. See FTCH § I, E9g.

j. Limits on coverage. The FECA limits coverage for the harmful effects of agency-provided medical care to care provided under the following four classes of medical service programs authorized by 5 U.S.C. § 7901(c):

(1) Treatment of on-the-job illness or injury and dental conditions requiring medical attention.

(2) Pre-employment, annual and other examinations.

(3) Referral of employees to private physicians and dentists.

(4) Preventive programs relating to employee health.

k. Extension of coverage. Additionally, the Office of Workers' Compensation may extend coverage when any of the following applies:

(1) The Office of Workers' Compensation has given specific authorization for the treatment.

(2) The medical treatment is given when the employment's causal relationship to the injury is in question.

(3) The employer furnishes emergency medical treatment to an employee for a non-work-related condition while the employee is at work (the "human instincts doctrine").

(4) The employee does not have the "freedom and opportunity" to receive treatment at alternative medical facilities. This issue takes on even greater importance when the United States renders medical care or treatment to a civilian employee who is entitled to receive all care in an overseas MTF as a benefit of employment. See In the Matter of Beverly Sweeny and Department of Defense Overseas Schools; Employees' Compensation Appeals Board Docket No. 85-1199, 25 June 1986; and "Workman's Compensation and the Overseas Civilian Employee: A New Development," The Army Lawyer , November 1986, at 71-72.

l. Unscheduled coverage. FECA covers the claims of federal civilian employees who allege violation of an employment right as well as any claim involving an injury for which the rules governing federal civilian employment provide a comprehensive remedy, Bush v. Luca, 462 U.S. 367 (1983). Such claimants often seek compensation for emotional distress or psychological injury as a result of alleged misconduct. For these claims, the administrative remedies provided under the civil service regulations are the employee's exclusive remedy. See FTCH § I, E9i. Additionally, constitutional ("Bivens"-type) claims do not lie against co-employees absent special factors (for example, where there is no comprehensive Congressionally mandated remedy available, Bush, supra; Schweiker v. Chilicky, 487 U.S. 412 (1988). The exclusive remedy for a federal civil servant's discrimination claim is Title VII of the Civil Rights Act of 1964, Brown v. General Services Administration, 425 U.S. 820 (1976). Additionally, the Civil Service Reform Act of 1978, 5 U.S.C. § 2301, provides the exclusive civil remedy for federal employees claiming financial injury resulting from personnel actions, Johansen v. United States, 343 U.S. 427 (1952); Coyle v. Adelman, 705 F. Supp. 48 (D.D.C. 1989); United States v. Fausto, 484 U.S. 439 (1988).

2-39. Statutory exceptions

a. Introduction. By statute, the following exclusions apply to FTCA claims, 28 U.S.C. § 2680. AR 27-20, paragraph 2-28 sets forth when the exclusions apply to other chapters. Except for exclusion 14, they apply also to the MCA and NGCA. Additional exclusions are listed in individual chapters of AR 27-20 . The FTCA expressly bars the following claims:

b. Discretionary function.

(1) Arising out of an act or omission of an employee of the federal government, exercising due care in the execution of a statute or regulation, even if such statute or regulation is invalid, 28 U.S.C. § 2680(a). This is generally referred to as the "due care" exclusion. Typically, claims involving this exclusion grow out of authorized government activities such as flood control or irrigation projects, where there is no evidence of negligence. The only basis for the claim is the contention that the same conduct by a private person would be deemed tortious under state law or that the enabling statute or regulation was invalid. In such claims, the only issue to be resolved is the statute or regulation's existence, not its validity.

(2) Arising from an act or omission classed as a discretionary function and excluded by 28 U.S.C. § 2680(a), which preserves sovereign immunity for the government's formulation and execution of policy decisions as well as its failure to make policy decisions. This exclusion derives from the constitutional separation of powers between the executive and judicial branches of the federal government; it prevents the judiciary from "second guessing" public policy decisions and avoids basing potential tort liability on an executive agency's judgment. The U.S. Supreme Court has expressed its current reasoning in Dalehite v. United States, 346 U.S. 15 (1953); United States v. S.A. Empresa de Viacao Aerea Rio Grandense (Varig Airlines), 467 U.S. 797 (1984), Barnson v. United States, 816 F.2 d 549 (10th Cir. 1987), cert. denied, 484 U.S. 896 (1987), Berkovitz v. United States, 486 U.S. 531 (1988), and United States v. Gauber, 499 U.S. 315 (1991). See also FTCH § II, B4c. Negligence is not relevant to the discretionary function analysis: the key issues are the nature and quality of the conduct; what social, political, economic or military factors influenced the policy decisions; whether discretion, choice or judgment were used or involved; and whether a specific mandatory policy rule, regulation, or directive was violated. However, claims arising out of the negligent non-discretionary implementation of the discretionary plan or design of such projects (ministerial acts), the negligent operation of such projects, or an agency's failure to act in accord with a specific mandatory directive are not barred. A list of discretionary function exception cases is posted on the USARCS Web site at "Claims Resources," II, a, no. 14. See subparagraph 2-44b .

c. Postal matter. Arising out of the transmission of postal matter, 28 U.S.C. § 2680(b). This exclusion applies to the loss, miscarriage or negligent transmission of letters or postal matter, Marine Insurance Co. v. United States, 378 F.2 d 812 (2d Cir. 1967), cert. denied, 389 U.S. 953 (1967). FTCH § II, B4d, and has been applied to personal injuries caused by the delivery of postal matter. However, the exclusion may not bar claims in which state law recognizes a cause of action for invasion of privacy, postal regulations are violated, or letters or postal matter are in the possession of military personnel, even though the loss may be caused by a criminal act. Such losses may be payable by the uniformed services to the U.S. Postal Service under 39 U.S.C. § 411, or to third parties under the MCA as set forth in paragraph 2-15i(3) .

d. Taxes, duties, and detention of goods. 28 U.S.C. § 2680(c); Kosak v. United States, 465 U.S. 848 (1984), United States v. 2,116 Boxes of Boned Beef, 726 F.2 d 1481 (10th Cir. 1984), cert. denied, 469 U.S. 825 (1985). See also FTCH § II, B4e. Other adequate remedies are available to anyone aggrieved by the application of U.S. tax or customs laws, see 26 U.S.C. § 6213. Alternatively, the claimant may pay the tax and sue in the Court of Federal Claims or the appropriate U.S. District Court for a refund (28 U.S.C. §§ 1491 and 1346(a)(1)). Still other remedies are available for the loss or detention of goods or merchandise. The bailment provisions of the MCA may apply, or where state law permits a bailment for a constitutional taking, the FTCA may apply, Hatzlachh Supply Co., Inc. v. United States, 444 U.S. 460 (1980). See also AR 195-5 , concerning destruction of scientific evidence. The detention of goods exclusion may apply to seizures government employees make in connection with an arrest. Most federal circuit courts have held that the exception applies to agencies other than the Customs Service. FTCH § II, B4e(4). See paragraph 2-17d(14) of this publication.

e. Maritime. Arising under the Suits in Admiralty Act or under the Public Vessels Act (46 U.S.C. §§ 31101-31113, 28 U.S.C. § 2680(d)). See chapter 8 . To be cognizable under these statutes, the tort must have both a maritime situs and a maritime nexus; otherwise the claim is cognizable under the FTCA. Executive Jet Aviation, Inc. v. City of Cleveland, Ohio, 409 U.S. 249 (1972), reversing Weinstein v. Eastern Airlines, Inc., 316 F.2 d 758 (3rd Cir. 1963), cert. denied, 375 U.S. 940 (1963); Kaiser Aetna v. United States, 444 U.S. 164 (1979). Generally, these Acts subject the United States to the same liability that admiralty law imposes on a private ship owner, apart from liability for seizure or arrest of a United States vessel. They permit suits on all types of claims cognizable in admiralty, including those for damage or injury done or consummated on land by a public vessel, inadequate supervision by government employees of cargo loading aboard private vessels, and injuries arising out of pleasure boating on navigable U.S. waters. See FTCH § II, B4f. Suit may be filed under SIA or PVA without filing an administrative claim. However, maritime claims may be considered under the Army Maritime Claims Settlement Act (AMCSA)(10 U.S.C. §§ 4801, 4802, and 4803). For additional discussion see also paragraph 2-15h and chapters 8 of this publication and AR 27-20 .

f. Trading with the Enemy Act. Arising out of the administration of the Trading with the Enemy Act, 28 U.S.C. § 2680(e). This Act provides the sole remedy for any person claiming money or other property held by an alien property custodian. This exclusion should be construed broadly.

g. Quarantines. Seeks compensation for damages caused by imposing a quarantine, 28 U.S.C. § 2680(f). However, claims for failure to impose a quarantine or for delay in enforcing a quarantine fall within the discretionary function exclusion and claims for negligently testing persons allegedly exposed to a risk factor may involve the misrepresentation exclusion, 28 U.S.C. § 2680(h). See FTCH § II, B4h.

h. Intentional torts.

(1) Assault or battery. Arising out of an assault or battery, 28 U.S.C. § 2680(h); FTCH § II, B4I(1). Claims are not barred for actions committed on or after 16 March 1974 by U.S. investigative or law enforcement officers empowered by law to execute searches, seize evidence, or arrest persons for violations of federal law. Nor does § 2680(h) bar claims arising out of the performance of medical, dental, or related health care functions, the Gonzales Act, 10 U.S.C. §1089(e). Case law consistently supports this exclusion's application to all other federal employees. Claims based on the acts or omissions of investigative or law enforcement officers most often arise from the alleged use of excessive force. See FTCH § II, B2j for a list of federal law enforcement officers. It is important to investigate thoroughly any claims alleging the use of threatening or deadly force, especially by a law enforcement officer, to determine whether the circumstances justified the nature, amount and use of such force.

(2) Negligence or negligent supervision. Often, a claimant's attorney employs artful pleading to create a cause of action that sounds in negligence or negligent supervision. However, the Supreme Court has interpreted the exclusion to encompass any claim "arising out of" an assault or battery, thereby precluding claims sounding in negligence, United States v. Shearer, 473 U.S. 52 (1985), unless there is a special relationship prior to the assault by virtue of a mandatory directive or the nature of the relationship, such as physician-patient or caretaker-child created duty, Sheridan v. United States, 487 U.S. 392 (1988).

(3) Intentional or negligent infliction of emotional distress. Certain types of conduct such as intentional or negligent infliction of emotional distress may be actionable where recognized by state law. Claims for sexual harassment, for negligence, such as accidental discharge of a weapon; negligent supervision when the actor is not a government employee; or harmful physical contact that grows out of a special, fiduciary relationship (as in medical treatment or child care) may also be cognizable.

(4) False imprisonment, false arrest, malicious prosecution, or abuse of process. 28 U.S.C. § 2680(h). FTCH § II, B4i(2). This exclusion applies generally when a federal employee acts within the scope of employment. It bars claims even though the acts alleged may constitute a separate cause of action under state law, such as negligent infliction of emotional distress as a result of negligent recordkeeping that leads to an arrest. It does not apply to investigative and law enforcement officers of the United States. See FTCH § II, B4I(2). For false imprisonment and false arrest claims, the United States is entitled to all defenses the individual officer may raise, such as good faith, reasonable belief and probable cause; the arrest, however, must be otherwise lawful under state law. This exclusion should be broadly interpreted: it will bar claims for negligent conduct that aggravates or results from the government's antecedent negligence, causing mental anguish, humiliation, fear or loss of earnings. This exclusion also bars claims for malicious prosecution, groundless institution of criminal proceedings and abuse of process, that is, the use of legal process for a purpose for which it was not designed. Certain claims for unjust convictions are cognizable under 28 U.S.C. § 1495 and 28 U.S.C. § 2513. See paragraph 2-17c(2)(c) .

(5) Libel, slander, misrepresentation, or deceit. 28 U.S.C. § 2680(h). This exclusion has been construed broadly to bar claims for negligent as well as intentional misrepresentation, United States v. Neustadt, 366 U.S. 696 (1961). It applies equally to affirmative or implied misstatements and negligent omissions, Preston v. United States, 596 F.2 d 232 (7th Cir. 1979), cert. denied, 444 U.S. 915 (1979). The courts have applied it to bar invasion of privacy claims and claims against wrongdoers who furnish defamatory information to a prospective employer. It bars claims for the negligent failure to perform an operational task such as failing to convey vital public safety information, independent of any secondary misstatement resulting in personal injury or property damage. The exclusion does not bar claims against a physician who misdiagnoses a patient, since resulting damage sounds in medical malpractice, the gravamen of the action, and the misrepresentation (the stating of misinformation) is merely incidental. The misrepresentation exclusion did not apply when the federal government sold bomb casings to a scrap dealer, expressly warranting their safety and fitness for scrap metal processing, and one bomb casing later exploded. Before applying this exception to an administrative tort claim, consider the nature of the government's acts or omissions as well as any information upon which the claimant may have detrimentally relied. See FTCH § II, B4I(4).

(6) Interference with contractual rights. 28 U.S.C. § 2680(h). This exclusion bars claims for loss or infringement of future or prospective rights or economic advantage as well as existing rights. It also covers interference with employment rights Dupree v. United States, 264 F.2 d 140 (3d Cir. 1959), cert. denied, 361 U.S. 823 (1959); Chafin v. Pratt, 358 F.2 d 349 (5th Cir. 1966), cert. denied, 385 U.S. 878 (1966). See FTCH § II, B4I(5). DOJ policy requires that claims for damage to bailed property be excluded by this exception even where the damage results from a negligent or wrongful act or omission by a United States employee acting within scope of employment. Such claims should be referred to the contracting officer.

i. Fiscal operations. Arising from the Department of the Treasury's fiscal operations or from the regulation of the monetary system, 28 U.S.C. § 2680(i), FTCH II, B4j. This exclusion encompasses all government financial disbursing operations. Most claims barred by this section arise out of improper wage and salary payments made to federal employees or payments on government contracts. Forward these claims either to DFAS or through contract channels to the contracting officer for consideration.

j. Combat activities. Arising out of combat activities of the military or naval forces, including the Coast Guard during wartime, 28 U.S.C. § 2680(j). See paragraphs 2-17b( 1 ) and ( 2 ). War need not be formally declared for this exclusion to apply. Although the "combat activities" exclusion has been held to bar claims arising from troop movements in anticipation of imminent attack, claims for wartime combat training and for peacetime medical malpractice on veterans injured in combat are not barred. See FTCH § II, B4k.

k. Foreign countries. 28 U.S.C. § 2680(k). There is as yet no clear, firm definition of a "foreign country," but the courts have held that U.S. embassies, leased military bases, territory occupied by the military services, trusteeships under the mandate of the United Nations, and the high seas fall within the "foreign country" category, United States v. Spelar, 338 U.S. 217 (1949); Callas v. United States, 152 F. Supp. 17 (E.D.N.Y. 1957), aff'd, 253 F.2 d 838 (2d Cir. 1958), cert. denied, 357 U.S. 936 (1958); Smith v. United States, 507 U.S. 197 (1993). Claims arising in certain foreign countries still may be cognizable under the single-service responsibility delegated to a particular military service under other statutes. Note, however, that under the "headquarters tort" theory, the foreign country exclusion does not bar a claim if actionable negligence takes place in the United States but its consequences occur in a foreign country. See FTCH § II, B1c(15) and § II, B4l. See AR 27-20, chapters 3 , 7 , and 10 for additional guidance on claims arising in a foreign country.

l. Tennessee Valley Authority. Arising from the activities of the Tennessee Valley Authority, 28 U.S.C. § 2680(l) (payable by the Tennessee Valley Authority under 16 U.S.C. §§ 831-831ee). See FTCH § II, B4m.

m. Panama Canal Commission. Arising from the activities of the Panama Canal Commission, 28 U.S.C. § 2680(m) and 22 U.S.C. § 3761. Canal Zone claims are no longer cognizable under the FTCA since the Zone ceased to exist on 1 October 1979, the date the Panama Canal Treaty was executed. See FTCH § II, B4m.

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

2-40. Flood exclusion

No liability of any kind shall attach to or rest upon the U.S. for any damages from or by flood or flood waters at any place. See 33 U.S.C. § 702c. This exception has been broadly construed and covers damage from flood control and multipurpose projects and all phases of construction and operation. It has not been extended to, and does not bar, claims for damage caused by manmade floods. In many flood control projects, the enabling legislation requires the non-federal beneficiary (such as the flood control or levee district) to hold and save harmless the United States from damages caused by the project's construction, operation, and maintenance. Look for such clauses when investigating flood claims. Claims arising out of recreational activities at COE reservoirs are discussed in paragraph 2-27c and FTCH § II, B4o.

2-41. Army Reserve National Guard property

Claims are barred for damage to 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. This exception does not apply to property of a county, city town or other political subdivision of the state. If a state demands to be informed of the rationale for denial, the matter will be referred to the Commander USARCS. See AR 27-20, chapter 6 .

2-42. Federal Disaster Relief Act

Claims are barred for damage to property or for death or personal injury arising out of the activities of any federal agency or employee carrying out the provisions of the Federal Disaster Relief Act of 1974. ( See 42 U.S.C. § 5173). See FTCH § II, B5v, and paragraph 2-15l of this publication. This Act requires the local beneficiary (state or local government) to hold the government harmless and to assume the defense of all claims arising from the removal of debris and wreckage from public or private property. Agreements setting forth such procedures are made on each such emergency occasion.

2-43. Non-justiciability doctrine

Claims that invoke the non-justiciability or political question doctrine are barred, Baker v. Carr, 369 U.S. 186 (1962). Federal courts apply a six-prong test to determine these cases, any one of which, if found, may be grounds for dismissal. The following items are the six factors:

a. A commitment of the issue to a coordinate branch of government by the text of the Constitution.

b. A lack of judicially discoverable and manageable standards for resolving the matter.

c. The impossibility of deciding without a policy determination that calls for non-judicial discretion.

d. The impossibility of undertaking independent resolution without expressing lack of respect for coordinate branches of government.

e. An unusual need for unquestioning adherence to a political decision already made.

f. The potential for embarrassment from multiple pronouncements by various federal departments on one question. This exclusion comprehends questions of judicial restraint and separation of powers. For examples of its application, see FTCH § II, B4r.

2-44. Statute of limitations

Each statute enumerated in AR 27-20 for the administrative settlement of claims specifies the time period during which the right to file a claim must be exercised, FTCH § I, D. State or local statutes of limitations do not apply to the United States. Additionally, state or local requirements to exhaust administrative remedies before filing suit do not delay the start of the statute of limitations on a claim against the United States (local law requiring an employee to exhaust the worker's compensation remedy before filing suit will not delay start of the FTCA statute of limitations window). Instead, the statute of limitations starts to run on the date the claim accrues. However, follow state or local law in determining whether a cause of action has been created. For example, in the context of an FTCA wrongful death claim, state law creates the cause of action. Even when a wrongful death claim is filed within two years of death, state law may determine whether or not the claim is barred for the decedent's failure to timely pursue a personal injury claim. It is the policy of USARCS to interpret all statutes of limitations in accordance with federal decisions.

a. Accrual. Federal law determines the accrual date. A claim accrues on the date on which the injured party knows of an injury or loss and its cause. In claims for indemnity or contribution against the United States, the accrual date is the date payment is made by the parties seeking indemnity or contribution.

b. Discovery exception to accrual date.

(1) When the claimant does not know of the injury or damage or does not know of its cause, the claim does not accrue until the injured party, or someone acting on the party's behalf, knows or should know about the existence of both the injury and its cause.

(2) This so-called "discovery rule" was articulated in the Supreme Court case of United States v. Kubrick, 444 U.S. 111 (1979). This means that, in many medical malpractice cases, accrual may be deferred until the date the claimant is aware or, in the exercise of due diligence, should be aware of both the injury and its cause. Accrual is not delayed pending a determination by the claimant that the injury was negligently inflicted. In Kubrick, the plaintiff was administered an antibiotic for a leg infection in April 1968. Six weeks later, the plaintiff suffered a hearing loss. In January 1969, a private physician informed Mr. Kubrick that it was possible his hearing loss resulted from the antibiotic administration. In June, another civilian doctor informed Mr. Kubrick that the antibiotic had indeed caused the hearing loss and that it should never have been administered. The claim was filed in September 1972. The Supreme Court held that the claim accrued in January 1969, when Mr. Kubrick was aware of his injury and its cause; the statute of limitations was not tolled until June 1971, when he received actual notice that the administration of the antibiotic was substandard treatment. The Supreme Court stressed that accrual is to be judged by an objective standard of whether the plaintiff knew, or in the exercise of reasonable diligence should have known, of the injury and its cause.

(3) The "discovery rule" is not limited to medical malpractice claims but has been applied to diverse situations, including chemical and atomic testing, erosion, and hazardous work environments.

c. Other exceptions to accrual date rule.

(1) Continuous treatment doctrine. In medical malpractice actions, accrual may be delayed until the treatment is completed when a course of continuous treatment is provided for the same injury or illness over a period of time. The rationale for this doctrine seeks to protect a plaintiff from having to challenge or question a physician while receiving necessary medical care. Courts are divided over whether the doctrine should apply to treatment by successive government physicians.

(2) Delayed accrual due to reasonable reliance on assurances. Accrual may be delayed for the period of time during which the claimant reasonably relied on his or her physician's assurances that the condition was temporary, that it was a normal side effect or that it was not caused by substandard treatment. See, Burgess v. United States, 744 F.2 d 771 (11th Cir. 1984); Rosales v. United States, 824 F.2 d 799 (9th Cir. 1987); and Chamness by and through Chamness v. United States, 835 F.2 d 1350 (11th Cir. 1988).

(3) Blameless ignorance or credible explanation. If the claimant was provided a credible explanation for the injury by the tortfeasor, such as a HCP, some courts have held that the claimant is not under any duty to seek another explanation.

(4) Fraudulent concealment. Although there is no affirmative duty to reveal negligence, if anyone affirmatively attempted to conceal the facts or the involvement of the United States or its employees in a negligent or wrongful act or omission, a court may find that the cause of action did not accrue until the claimant discovered the true facts.

(5) Suppressed recollection. Claimants may argue that the statute of limitations is extended in cases where the emotional injury was such that all memory of the negligent act or acts was suppressed, and that the claim does not accrue until the memory of the incident is recovered. Most courts addressing the issue have rejected this theory.

d. Tolling. See also paragraph 2-8 .

(1) Claimant's disability. As a general rule, the claimant's disability does not toll the statute of limitations for tort actions during the period of disability. Therefore, the statute of limitations is not tolled during periods of infancy or minority (unlike state statute of limitations which may be tolled until the claimant reaches the age of majority), or during periods of incompetency, FTCH § I, D3a and b. When the claimant is both an infant and an orphan, however, the statute of limitations may be tolled until a guardian is appointed. See Mann v. United States, 399 F.2 d 672 (9th Cir. 1968); contra: Zavala by and through Ruiz v. United States, 876 F.2 d 780 (9th Cir. 1989). Additionally, some courts have held that where the claimant's incompetence is a direct result of the negligence of the United States, the statute of limitations may be tolled either until the period of incompetency ends or until a legal guardian is appointed. Some of the cases addressing this issue draw a distinction between incompetency, which does not toll the statute of limitations, and brain damage so severe that the plaintiff is unable to know the nature or cause of the injury, which does. Compare Barren by Barren v. United States, 839 F.2 d 987 (3rd Cir. 1988), cert. denied, 488 U.S. 827 (1988) with Clifford by Clifford v. United States, 738 F.2 d 977 (8th Cir. 1984).

(2) Filing of a lawsuit. The SOL is not tolled by filing a lawsuit based upon the same incident in a federal, state, or local court against the United States or other parties. However, if a party's FTCA suit against the United States, filed within the original statute of limitations, is dismissed without prejudice for failure to exhaust administrative remedies, the dismissal order will typically state a time period within which a subsequent administrative claim may still be timely filed. Additionally, the Federal Employees Liability Reform and Tort Compensation Act (28 U.S.C. § 2679(b)) expressly provides for the tolling of the statute of limitations under § 2401(b) if a suit is timely filed against a federal employee for a common law tort committed within the scope of employment, 28 U.S.C. § 2679(d)(5). Lack of knowledge of U.S. involvement does not toll the statute of limitations.

(3) Effect of military service. The Servicemembers Civil Relief Act of 2003, Pub. L. No. 108-189 , § 206, 117 Stat. 2853 (2003), codified at 50 U.S.C. app. §§ 501-596, suspends various civil liabilities of persons during their continuous active military service. Section 206 of the Service Members Civil Relief Act states that "the period of military service shall not be included in computing any period now or hereafter to be limited by any law, regulation, or order for the bringing of any action or proceeding in any court, board, bureau, commission, department, or other agency of government . . ." This language has been held to toll the FTCA' s two-year statute of limitations even though the Soldier was otherwise under no disability to prevent filing of suit, such as physical limitations or being outside CONUS. The Soldiers and Sailors Civil Relief Act (former Act of 1940) (that uses the same language as the Service Members Civil Relief Act) applies to only the Soldier's claim (assuming it is not Feres barred) and may operate to save the Soldier's derivative claim even when the principal claim (such as a military dependent's claim) is time barred, Romero by Romero v. United States, 806 F. Supp. 569 (E.D. Va. 1992), aff'd, 2 F.3 d 1149 (4th Cir. 1993) (held: Soldiers and Sailors Civil Relief Act applied to Soldier-father of brain-damaged baby even though child's and mother's claims were barred by statute of limitations); Kerstetter v. United States, 57 F.3 d 362 (4th Cir. 1995). The court did not require showing that military service prejudiced a Soldier's ability to pursue an action to recover his property sold in a tax sale more than 20 years ago, Conroy v. Aniskoff, 507 U.S. 511 (1993).

(4) Equitable tolling. The doctrine of equitable tolling applies generally to a claim or suit that has not been timely filed due to the defendant's action or inaction, for example, misleading a potential claimant as to the appropriate time limits and the procedure for filing a claim or misinforming a patient about the cause of an injury. Formerly, the FTCA' s two-year statute of limitations was held to be jurisdictional, subject neither to waiver nor to equitable tolling. The Supreme Court held, in Irwin v. Dep't of Veterans Affairs, 498 U.S. 89 (1990), however, that the doctrine of equitable tolling applied to a requirement to file suit within ninety days of receiving notice of denial of an equal employment opportunity complaint under 42 U.S.C. § 2000e-16(c). The Court stated that statutes of limitations in actions against the United States are subject to the same rebuttable presumption of equitable tolling as are suits against private individuals. In the wake of Irwin, the Eighth Circuit Court of Appeals held that the FTCA' s six-month requirement to file suit contained in 28 U.S.C. § 2401(b) was not jurisdictional but rather an affirmative defense to be established by the United States, Schmidt v. United States, 901 F.2 d 680 (8th Cir. 1990), vacated and remanded, 498 U.S. 1077 (1991), on remand, 933 F.2 d 639 (8th Cir. 1991). Since Schmidt, the federal circuit courts have widely acknowledged that equitable tolling applies to the FTCA, see, Diltz v. United States, 771 F. Supp. 95 (D. Del. 1991) (in which equitable tolling was applied to negligent eye surgery case); and Glarner v. United States Department of Veterans Admin., 30 F.3 d 697 (6th Cir. 1994) (equitable tolling applied in VA case in which patient who expressed a desire to file a negligence claim was given a benefits form rather than a claim form). See also, McKewin v. United States, Civ. No. V 91-131-CIV-5-7 (E.D.N.C. 1992); Mutch v. United States, 804 F. Supp. 838 (S.D. W. Va. 1992); Justice v. United States, 6 F.3 d 1474 (11th Cir. 1993); First Alabama Bank v. United States, 981 F.2 d 1226 (11th Cir. 1993) (decisions in which courts acknowledge general application of equitable tolling to FTCA cases even though held that it did not act to toll the statute of limitations under facts of individual cases). Any FTCA claim involving a settlement greater than $200,000 on which an issue of equitable tolling is involved requires preliminary discussion with the DOJ before negotiation of any settlement. Because USARCS policy has been to interpret the statute of limitations in light of FTCA decisions, equitable tolling principles may be applied to all AR 27-20 claims. The doctrine places the burden on the United States to prove untimely filing. Procedures to inform potential claimants of their rights are essential, including full and forthright discussions of the undesired results of medical care.

2-45. Federal employee requirement

a. Definition. Because individuals conduct the activities of the United States, the government's tort liability is always derivative. Federal liability exists only when the responsible individual is an "employee of the government," 28 U.S.C. § 2672; 10 U.S.C. § 2733(a). That phrase, as the FTCA defines it, includes: "officers or employees of any federal agency, members of the military or naval forces of the United States, members of the National Guard while engaged in training or duty under sections 316, 502, 503, 504, or 506 of title 32, and persons acting on behalf of a federal agency in an official capacity, temporarily or permanently in the service of the United States, whether with or without compensation," 28 U.S.C. § 2671. "Employee of the government" includes, but is not limited to, those categories of individuals listed at AR 27-20, paragraph 2-2b , and federal law determines whether one is an employee of the United States, Logue v. United States, 412 U.S. 521 (1973). The FTCA defines a "federal agency" as "the executive departments, the judicial and legislative branches, the military departments, independent establishments of the United States, and corporations primarily acting as instrumentalities or agencies of the United States," 28 U.S.C. § 2671. However, the FTCA specifically excludes "any contractor with the United States" from its "federal agency" definition. Contractors are not federal agencies and their employees may not be considered "employees of the government" such that the United States is liable for their tortious acts or omissions under the FTCA (FTCH § II, B2d). In practice, courts have limited the "contractor" language in 28 U.S.C. § 2671 to track the "independent contractor" test derived from the law of agency. See Restatement (2d) of Agency § 220 (factors to be considered include the degree of control exercised by the employer; whether or not the person hired is engaged in a distinct occupation or business; the kind of occupation; whether the work is usually done under the direction of the employer or by a specialist without supervision; the skill required in the particular occupation; whether the employer or the workman supplies the instrumentalities, tools, and the place of work; and the method of compensation, whether by time unit or by the job).

b. Independent contractors. See paragraphs 2-15f and 2-62b .

(1) Injury to employees of an independent contractor. When confronted with such a claim, conduct a thorough investigation to determine whether there was any direct negligence on the part of the United States or its employees. Next, scrutinize the terms of the government contract at issue for any language obligating the contractor to indemnify the United States for claims arising from contract operations. Then research state law to determine whether a specific duty has been created by either statute or case law. See also whether state or local law makes any defenses to the claim, such as statutory employer, available to the United States. See Hyman v. United States, 796 F. Supp. 905 (E.D. Va. 1992), which held that the United States is a "statutory employer" under Virginia law such that the state law defense of employer immunity was available to bar a contractor employee's FTCA suit stemming from injuries incurred in an automobile accident on the Norfolk Naval Base. Also, consultation with the USARCS AAO is essential in cases alleging failure to inspect the worksite or to enforce safety provisions set forth in the contract because of the potential to invoke the discretionary function defense, FTCH § II, B2d, and B4c.

(2) Injury to third parties. Obviously, if the injury to the third party was caused in whole or in part by a government employee's negligent act, the United States may be directly liable to the claimant under the FTCA.

(a) A more difficult question involves whether or not, and under what circumstances, an independent contractor or its employee may be considered an "employee of the government" such that the United States bears FTCA liability for the contractor's tortious acts or omissions, as well as its own.

(b) The Supreme Court examined this question in Logue v. United States, 412 U.S. 521 (1973) citing "absence of authority in the principal to control the physical conduct of the contractor in performance of the contract" as determinative. In Logue, a federal prisoner was placed in a county jail pursuant to contractual arrangement. Due to the county jailers' alleged negligence, the prisoner committed suicide. The Supreme Court refused to hold the United States liable for the jailers' negligence because an examination of the relationship showed that federal employees did not run the day-to-day activities of the jail; instead, county employees conducted and supervised such activities in accordance with the terms of the government contract.

(c) The cases following in the wake of Logue have applied the "strict control test," whether the United States exerts day-to-day supervision and control over the "detailed physical performance of the contractor," United States v. Orleans, 425 U.S. 807, 814 (1976); reserving the right to specify conditions and to inspect work product is usually not sufficient to establish an "employee" relationship between the independent contractor's employee and the United States.

(d) Detailed federal safety regulations and evaluations are similarly insufficient to demonstrate strict control, because the real test is whether or not the United States maintains detailed control over the primary activity for which it has contracted, not the peripheral, administrative acts relating to such activity, FTCH § II, B2d. In the same vein, the government's reservation of a contractual right to ensure that contractor personnel are qualified has been held insufficient to demonstrate government control of the day-to-day operation.

(e) Under agency law, a principal who hires an independent contractor is not immune from liability for the contractor's torts if performance of the contract is the principal's "non-delegable duty," or if the state has adopted the Restatement (2d) of Agency § 214. The degree of control the principal exercises is irrelevant. In the body of case law dealing with government contracts, non-delegable duties typically arise from the performance of inherently dangerous activities or from the manner in which buildings and grounds are maintained ("safe place to work" statutes), FTCH § II, B4a(1)(c). Liability may attach under the "non-delegable duty" theory when the government requires a contractor to engage in harmful conduct that foreseeably could cause injury absent proper instruction to avoid such injury. Absolute liability is not the issue: there must be negligence or a wrongful act, such as failure to issue warnings.

c. Healthcare providers. See paragraphs 2-34 and 2-62 .

(1) Many HCPs within the military medical system provide services to DOD health care beneficiaries through a variety of programs and contracts established or authorized by Congress.

(a) Personal and non-personal services contracts. As amended, 10 U.S.C. § 1091 authorizes the DOD to contract for the provision of direct health services, including HCPs. All contracts under this statute are subject to the Federal Acquisition Regulation (FAR), the DOD FAR Supplement, and the Army FAR Supplement. A "services contract" is one in which the government directly engages the time and effort of a contractor whose primary purpose is to perform an identifiable task rather than to furnish an end item of supply. A "non-personal services contract" is one in which the personnel providing the services are not subject, either by the contract's terms or by the manner of its administration, to the supervision and control usually prevailing in relationships between the government and its employees. A "personal services contract" is one which, by its express terms or as administered, makes the contractor personnel appear to be, in effect, government employees, 48 C.F.R. , chapter 1, subpart 37.1. On 18 November 1997, President Clinton signed the Defense Department FY 98-99 Authorization Bill, which became Public Law No. 105-85 . Section 736 of that law amended the Gonzales Act, 10 U.S.C. § 1089, to add personal services contract physicians described in 10 U.S.C. § 1091. The effect of this amendment is to make personal services contract physicians "employees of the United States" for FTCA purposes. By analogy, personal services contract physicians also become U.S. employees under the MCA and the FCA. The effect of this amendment is not retroactive. Accordingly, for incidents dating after 18 November 1997, any claims involving personal services contract physicians will be investigated as if those physicians were U.S. employees and not independent contractors.

(b) Military-Civilian Health Services Partnership Program. The Partnership Program was created to improve the cost-effectiveness of the DOD health care delivery system. See DODD 6000.12 , April 29, 1996. The most commonly used "internal" partnership agreement allows MTF commanders to enter into formal agreements whereby civilian HCPs use government facilities to treat beneficiaries eligible under TRICARE. The Program's basic purpose is to encourage TRICARE-eligible beneficiaries to seek care in an MTF by offering them increased access to care and a waiver of the TRICARE cost share or deductible. Partnership providers are only paid for treatment of TRICARE-eligible beneficiaries receiving TRICARE-authorized care, and they are paid through the TRICARE fiscal intermediary. Subject to credentialing and hospital peer review procedures, these partnership providers are neither government employees nor, technically speaking, "contractors," because the FAR does not permit non-personal contracting. However, the relationship created between an MTF and a partnership provider is similar to that existing between the United States and an independent contractor. As with independent contractors, partnership providers are non-government, civilian care providers whose negligent acts should not create vicarious federal liability. Inherent in their relationship with the United States is the critical fact that government employees do not exercise day-to-day duty supervision and control over the contractor or partnership provider in the partnership program.

(c) Residents in training. Civilian medical institutions will frequently send their interns, residents and other medical trainees to government MTFs for training purposes. Similarly, the United States sends its medical trainees to civilian medical institutions for training. (See para 3-8 for a discussion of this issue.) Whether the borrowing MTF is liable depends on how the state interprets the borrowed or loaned servant doctrine, which purports to shift vicarious liability from the employing or lending master of a negligent servant to the borrowing master. Thus, the United States may bear responsibility for the tortious acts of a civilian medical institution employee who is training in a MTF. Thoroughly investigate all claims involving health care trainees in MTFs to determine the nature and extent of the day-to-day supervision and control that government employees exercised over them. Additionally, research state agency law to ascertain the elements required to assert or refute a borrowed or loaned servant defense.

(2) The FTCA exclusion of contractors from the definition of a federal agency applies to contractors who provide medical services. Tests similar to the "strict control" test have been applied to physician groups and individual physicians providing medical services to MTFs. There are two basic tests which have been developed for doctors who contract with the government:

(a) The "strict control" test, stemming from the Logue and Orleans line of cases, and a variation on it, the "strict control aside from professional judgment" test, discussed in Lurch v. United States, 719 F.2 d 333 (10th Cir. 1983), cert. denied, 466 U.S. 927 (1984).

(b) The Lurch court stated in dicta that the strict control test for determining employee or contractor status for FTCA purposes is inappropriate for cases involving doctors because, due to their training and ethical obligations, doctors can never be "controlled." The Court believed that a doctor must always be free to exercise independent professional judgment as to what is best for each patient. However, the Lurch Court did not analyze the facts in light of the modified test because the contract specified that the doctor would not be considered an employee of the government for any purposes.

(c) In Wood v. Standard Products Co., Inc., 671 F.2 d 825 (4th Cir. 1982), a progeny of Logue and Orleans, a private physician who contracted with the U.S. Public Health Service to provide medical services to seamen in a remote, little-used port was held to be an independent contractor because there was no evidence that the government supervised or controlled his day-to-day practice or treatment of patients. Among the significant facts the Wood court cited in reaching its holding were:

(1) The contract referred to the physician as a "contract physician."

(2) The contract specified that the physician was to provide outpatient medical care in the same manner and of the same high quality as he provided for his private patients.

(3) The contract did not specify the physician's hours.

(4) The physician had the right to refuse to treat patients.

(5) The U.S. Public Health Service did not provide office space, support, services, supplies, or equipment to the physician.

(6) The physician billed the U.S. Public Health Service under a predetermined fee schedule.

(7) U.S. Public Health Service site visits were meant only to check the adequacy of the physician's facilities and not to "oversee" his practice.

(8) Unlike contract physicians, a contract nurse may be directly supervised by, and under the control of, a government employee so as to make the nurse a government employee, even if the nurse is individually credentialed, for example, as a nurse-midwife or certified registered nurse anesthetist (CRNA). In the case of Bird v. United States, 949 F.2 d 1079 (10th Cir. 1991), for example, the 10th Circuit Court of Appeals found that a CRNA was an employee of the United States because the CRNA was under the control and supervision of government physicians; the CRNA was required to work with patients assigned by others; the CRNA had no separate office, used hospital equipment exclusively; and was under the same degree of control and supervision by the government surgeon as any government nurse in the hospital.

(9) In every case involving non-government HCPs, it is imperative to investigate the facts to determine the nature and extent of government control over the HCPs as well as to rule out additional direct tortious activity on the part of a government employee, such as a negligent act or omission by a government nurse, technician, or other support person in the emergency department, operating room, intensive care unit, or laboratory. Additionally, conduct a factual investigation and research state law to determine whether there is potential federal liability for the acts of the non-government HCP under the theories of "ostensible agency, "apparent authority," or "agency by estoppel." See Restatement (2d) of Agency 26 and 27, FTCH § II, B2c. Also, be alert for potential governmental liability under the theories of negligent hiring or credentialing, particularly if the independent contractor or partnership provider has a "track record" of complaints or adverse events. These liability theories have been applied with equal force to independent contract physicians as well as to TRICARE partnership providers practicing in MTFs. Finally, research state law to determine the availability of the "captain of the ship" defense, commonly arising in claims against a non-government surgeon who could be held liable for the tortious acts of government operating room personnel (the retained sponge case).

d. Volunteers. See AR 608-1, chapter 5 .

(1) The general rule on volunteers is set forth in 31 U.S.C. § 1342, which provides that no officer or employee of the United States shall accept voluntary service for the United States or employ personal services in excess of that authorized by law, except in case of emergency involving the safety of human life or the protection of property.

(2) The Congress has carved statutory exceptions to this general rule for student volunteers employed pursuant to 5 U.S.C. § 3111(b), who are to be considered federal employees for purposes of the FTCA and MCA. Red Cross volunteers meeting the criteria set forth in AR 40-3 , paragraph 2-42, are also considered employees of the United States for claims purposes, FTCH § II, B2g.

(3) In 1983, Congress authorized the U.S. Armed Forces to accept voluntary services in military museums, natural resources and family support programs, Public Law 98-94, 97 Stat. 614, 10 U.S.C. § 1588. In 1995, Congress expanded the categories for which volunteers may be accepted by medical, dental, nursing and other health care services; Congress also expanded the types of family support programs authorized to accept volunteer services to include child development and youth services, library and education programs, religious programs, housing referral programs, spousal employment assistance programs, and other morale, welfare and recreation programs, Title X, Subtitle G, Defense Authorization Act, Pub. L. No. 103-337 , 108 Stat. 2663 at 2845, (10 U.S.C. § 1588). Department of Defense Instruction (DODI) 1100.21, dated March 11, 2002, implements 10 U.S.C. § 1588 and sets forth procedures for the use of volunteers in DOD facilities.

(4) Both the 1983 Act and the 1995 expansion thereof provided that a volunteer providing services under the aforementioned categories shall be considered a federal employee for purposes of the FTCA and the MCA, 28 U.S.C., chapter 171; 10 U.S.C. § 2733. Persons undergoing training are similarly included. The Acts also provide for workers' compensation benefits under FECA or LSHWCA, 5 U.S.C., subchapter I, chap. 81, and subchapter II, chapter 81.

(5) Any claim for injury or death to a volunteer is excluded under the FTCA or MCA if it arose incident to service or performance of duty. The FECA and LSHWCA are the volunteer's exclusive remedy. To be deemed a federal employee, the volunteer must be properly accepted by the federal agency and be performing within the scope of the accepted voluntary services at the time of the incident.

(6) The 1983 Act and its 1995 expansion are both specific about the federal agencies' need to publish implementing regulations permitting them lawfully to accept voluntary services. The portion of the 1983 Act pertaining to family support programs has been implemented by AR 215-1, chapter 14 , and AR 608-1, chapter 5. Any tort claim arising from the acts or omissions of a volunteer should be investigated and processed under the provisions of AR 27-20 , following consultation with the area action officer (AAO), just as though the volunteer were a Soldier or a civilian employee.

e. Loaned employees. Employees who are permitted to serve another employer may be considered "loaned servants," provided the borrowing employer has the power to discharge, control, and direct the employee and decide how he or she will perform the tasks. Whoever has retained those powers is liable for the employee's torts under the principle of respondeat superior. When those elements of direction and control have been found, the United States has been liable; for example, for the torts of government employees loaned for medical training and emergency assistance, and of county and state employees discharging federal programs.

f. Nonappropriated Fund Instrumentalities employees. For NAFI employees, see chapter 12 . Employees of NAFIs are considered employees of the United States if the activity or function is an instrumentality of the United States and thus a "federal agency" as the FTCA defines it, 28 U.S.C. § 2671. In determining whether or not a particular NAFI is a "federal agency," consider whether the NAFI is an integral part of the Army charged with an essential DA operational function in addition to the degree of control and supervision exercised by DA personnel over the NAFI employee, FTCH § II, B2i.

2-46. Scope of employment requirement

a. General rule. See chapter 5 . Under most chapters of AR 27-20, the government's tort responsibility for employees' acts or omissions arises only when they are acting within the scope of their employment, 28 U.S.C. § 2672; 10 U.S.C. § 2733(a)(3). Under the FTCA, the question of whether a federal employee is acting within the scope of employment at the time of an accident so as to make the United States liable in tort is one to be decided by applying the law of the place where the incident occurred, 28 U.S.C. § 1346(b) and §§ 2671-2680; Richards v. United States, 369 U.S. 1 (1962), Tucker v. United States, 385 F. Supp. 717 (D.S.C. 1974). FTCH § II, B3. Scope of employment under other chapters is determined by federal law, following FTCA case law. See AR 27-20, paragraph 3-5a(3)(b) .

b. Exceptions. Both the Non-Scope Claims Act, 10 U.S.C. § 2737, and the Foreign Claims Act, 10 U.S.C. § 2734, are exceptions to the requirement that a government employee must be acting within the scope of employment at the time of the incident. For further discussion, see chapters 5 and 10 .

c. Exclusive remedy. If a government employee commits a tortious act or omission, within the United States, while acting within the scope of his or her employment, then a claimant's exclusive remedy is a cause of action against the United States rather than against the employee individually; see the Federal Employees Liability Reform and Tort Compensation Act of 1988 (FELRTCA), Pub. L. No. No. 100-694 (1988) (codified at and amending 28 U.S.C. §§ 2671, 2674, 2679). The DOJ is responsible for determining whether or not an employee was acting within the scope of employment sufficiently to entitle that person to immunity from personal liability and to representation by the United States in any personal action. Certification of scope by the Attorney General is conclusive for removal purposes but reviewable for purposes of substituting the United States as the defendant in place of the individual employee, Gutierrez de Martinez v. Lamagno, 515 U.S. 417 (1995).

d. Line of duty. "Line of duty" as it appears in 28 U.S.C. § 2671 means the scope of employment as determined by the law of the jurisdiction in which the tort occurred, Williams v. United States, 350 U.S. 857 (1955). An "in line of duty" determination for military benefits purposes does not necessarily equal a determination that the Soldier was acting within the scope of employment at the time of the incident, FTCH § II, B3. However, because it is one factor to be considered in determining whether or not a federal employee acted within the scope of employment, obtain a copy of the line-of-duty investigation when investigating the claim.

e. Recurrent issues. While state laws vary, the scope of employment issue usually turns on the amount of control exercised by the employer over the employee and the degree to which the employer's purposes are served at the time of the incident. Always keep in mind that two persons may have been negligent: one, a supervisory employee acting within scope in addition to an employee-tortfeasor acting outside scope. The issues of negligent hiring, training, or supervising of the out-of-scope employee may coincide with issues such as whether the employee negligently maintained or provided the government property involved in the tortious act. Never limit the factual investigation to the claim's specific allegations. Recurring litigated issues include:

(1) Whether an employee can place his or her own conduct within the scope of employment by a unilateral decision to perform an act benefiting the master.

(2) Whether an employee's personal frolic so deviates from the employer's service as to remove the employee from the scope of employment.

(3) Whether the performance of a special errand for the employer on the way to or from work will place the employee in the scope of employment.

(4) Whether the existence of some continuing duty will keep an employee in scope even when nominally off duty, FTCH § II, B3a, and b.

f. Special cases.

(1) Travel to and from work. Most state court decisions hold that an employee traveling between home and workplace is not acting within the scope of employment unless:

(a) The accident site is on the employer's premises, such as on the government installation.

(b) The employee is specifically authorized to use a government owned vehicle (GOV) or POV.

(c) The official travel is to be reimbursed.

(d) The employee's use of a GOV or POV is authorized by customary use even though not expressly authorized, FTCH § II, B3g, AR 58-1 .

(e) Military Reservists or members of the National Guard commuting by POV from home (or from hotel accommodations arranged for their own convenience rather than that of the government) to their weekend drill site are usually not considered to be acting within the scope of their federal duties while commuting, but are considered in scope when traveling on orders authorizing POV use to and from inactive duty training or annual training. Prospective military recruits may be provided transportation in connection with interviews, processing and orientation, AR 58-1, paragraph 2-5g and DODD 4500.36-R .

(f) Travel to and from weekend drill in the reservist's POV is not within scope but travel to and from annual training can be if use of a POV is authorized by written order.

(2) Frolic and detour. Scope is presumed when the government employee is in an official vehicle; this presumption may be rebutted by showing that the employee was engaged in activities clearly unrelated to work. Factors to be considered include the purpose of the detour, whether it had a single or dual purpose; the relationship of the government employee's activities during the frolic or detour to the official duties; how much time elapsed during the frolic or detour; and whether the government employee was returning to the authorized route at the time of the incident, FTCH § II, B3b.

(3) Temporary duty travel. TDY travel by government employees has been consistently held as within the scope of employment. Use of POV for TDY travel should be specifically authorized by express verbal or written authorization by the approving official to avoid a scope issue, FTCH § II, B3f. To be considered within scope, activities the employee performs should be reasonably related to the trip's official purpose. For example, going to and from a hotel to the TDY workplace or from that workplace to a nearby restaurant is probably within scope; however, returning from bar to hotel in the wee hours is probably not within scope, FTCH § II, B3c.

(4) Permanent change of station (PCS) travel. Given the large number of military employees and the frequency of their transfer, accidents occur while they are changing duty stations pursuant to what is known as a "PCS move." The injured parties invariably sue the United States on the theory that the military employees were acting within the scope of their employment while changing duty stations pursuant to official government orders. Differences in local law and differing judicial attitudes toward the military command relationship make it difficult to reconcile these cases, FTCH § II, B3d. Some factors the courts consider are:

(a) Evidence of federal control over travel.

(b) Provisions for reimbursing military members on a mileage basis.

(c) Whether the military member had a choice between using official government transportation or a POV.

(d) Whether leave was granted and used in connection with the PCS move.

(e) Whether the transfer was for the benefit of the government or personal convenience.

(f) Whether an en route delay was just beginning or was ending at the time of the accident.

(g) Whether the accident occurred on a reasonably direct route between the old and new duty stations.

(5) Negligent or unauthorized entrustment. The United States may be held liable for the out-of-scope activities of its employees if a government employee negligently entrusted to the tortfeasor the government equipment, vehicle or other property causing the claimant's personal injury or property damage. For example, federal liability may be found where a government employee dispatches a vehicle to a visibly intoxicated Soldier. However, if the government employee who entrusted the government property to the tortfeasor also exceeded or otherwise acted outside the bounds or scope of his or her own authority, then the United States may escape liability, FTCH § II, B3e.

(6) Hitchhiker and unauthorized passenger liability. Some courts have held the United States liable for injury to hitchhikers and other unauthorized passengers caused by negligent government drivers even when the passenger's presence was a clear violation of an agency rule. Other courts have held that the government employee acted outside the scope of employment by permitting an unauthorized passenger to ride in a government vehicle and, therefore, the United States is not liable for the passenger's injury, FTCH § II, B3h. Refer to state law precedent. Also, investigate the facts thoroughly to determine whether any specific rules or SOPs addressed the issue; whether the agency enforced its own rules; and whether the agency or any of its employees were on notice that a prohibited practice was occurring or had occurred in the past and failed to take corrective measures.

(7) Sexual assault by HCPs. While, historically, intentional torts were excluded from FTCA coverage, the Gonzales Act carved out an important exception: if an HCP commits an assault or battery while acting within the scope of employment, federal liability attaches. The usual claim involves sexual assault and battery of a mental health patient by a therapist or sexual assault and battery of an unconscious patient by anyone. In some cases, the government will argue that the HCP was not acting within the scope of employment at the time the patient was assaulted, FTCH § II, B4I(1)(e). Governmental liability may be based, however, on the theories of negligent hiring or credentialing, or failure to supervise the HCP properly, provided there is a special relationship created between the government and the injured party. Several cases have held the United States directly liable on the theory that it owes unconscious or otherwise mentally impaired patients a special or higher duty of care to prevent them from falling victim to unscrupulous HCPs acting outside the scope of their employment, FTCH § II, B4I(1)(c). Courts have applied similar reasoning to hold the United States liable for sexual abuse by others, such as child care providers. See, Doe v. United States, 838 F.2 d 220 (7th Cir. 1988).

2-47. Negligence

See FTCH § II, B4.

a. Basis for liability. In any tort action brought against the United States, apply the basic principles of duty, breach, causation and damages, each of which should be thoroughly investigated before final action on a claim is taken.

b. Exclusions of claims based on absolute or strict liability. Principles of absolute or strict liability generally do not apply to tort claims under AR 27-20 . The FTCA imposes liability for either negligent or wrongful acts. Some type of malfeasance or nonfeasance is required, Dalehite v. United States, 346 U.S. 15 (1953); Free v. Bland, 369 U.S. 663 (1962); Laird v. Nelms, 406 U.S. 797 (1972). Thus, liability does not arise merely from federal ownership of an inherently dangerous commodity or federal engagement in ultrahazardous activity and some courts have decided against absolute liability in these cases:

(1) Air crashes where state law imposes absolute liability on the aircraft owner, United States v. Praylou, 208 F.2 d 291 (4th Cir. 1953), cert. denied, 347 U.S. 934 (1954) (note that the withdrawal of the Uniform Aviation Act by the Commissioners on Uniform State Laws and the adoption of other legislation by many states reduces Praylou's significance).

(2) Conduct amounting to negligence per se under state law because it is egregious or it violates a statute: such as approval of a substandard drug, Griffin v. United States, 500 F.2 d 1059 (3d Cir. 1974); using no warning flares at night, Cronenberg v. United States, et al., 123 F. Supp. 693 (E.D. N.C. 1954); use of a spring-loaded gun, Worley v. United States, 119 F. Supp. 719 (D. Or. 1952); hitting a bystander when shooting a trespasser, Cerri v. United States, 80 F. Supp. 831 (N.D. Cal. 1948); and failing to warn of submerged tree stumps, Stephens v. United States, 472 F. Supp. 998 (C.D. Ill. 1979).

(3) Breaches of a landowner's or employer' s non-delegable duty, such as the U.S. government's duty to provide contract employees with a safe place to work, whether pursuant to statute (such as the Illinois Scaffolding Act) or the state's adoption of the Restatement (2d) of Torts, which imposes upon employers a non-delegable duty to contract employees when they are engaged in an inherently dangerous activity, McCall v. United States Department of Energy, through Bonneville Power Admin., 914 F.2 d 191 (9th Cir. 1990), or self-imposed safety inspections if the inspection is viewed as a duty, not a right, Dickerson, Inc. v. Holloway, 685 F. Supp. 1555 (M.D. Fla. 1987).

(4) Situations in which circumstantial evidence supports the conclusion of res ipsa loquitur, in which no tort would have occurred in the absence of negligence, and there is no evidence of claimant's contributory negligence (aircraft accidents, United States v. Johnson, 288 F.2 d 40 (5th Cir. 1961) and explosions, Simpson v. United States, 454 F.2 d 691 (6th Cir. 1972)).

(5) Certain other situations where statutes or regulations impose a higher standard of care than does the common law (for example, state good Samaritan doctrine or statutes; state safe place statutes and state industrial commission rules and orders regarding stairway handrails, American Exchange Bank of Madison, Wisconsin v. United States, 257 F.2 d 938 (7th Cir. 1958); and installation regulations with the force of law which create a mandatory duty, Doggett v. United States, 875 F.2 d 684 (9th Cir. 1988).

(6) Claims arising from noncombat activities are discussed in chapter 3 . Neither negligence nor duty is required to be proven but a claimant must show proximate cause.

2-48. Duty

a. General. Since the United States is liable under circumstances in which a private person would be held liable in accordance with the law of the place where the act or omission occurred, there must first exist a duty on the part of the United States to the injured party.

(1) Generally, there is no strict or absolute liability under the FTCA, Dalehite v. United States, 346 U.S. 15 (1953). The Supreme Court has interpreted the statutory language "under circumstances" to mean something other than "under the same circumstances," Indian Towing Co. v. United States, 350 U.S. 61 (1955). Therefore, to recover from the United States, a claimant need not point to identical activity by a private individual. See Rayonier Inc. v. United States, 352 U.S. 315 (1957) (governmental liability for negligent firefighting), and Indian Towing, supra(governmental liability for improperly operating a channel light).

(2) The Supreme Court has interpreted the "law of the place" as referring to the whole law, including the jurisdiction's choice of law principles, Erie R. Co. v. Tompkins, 304 U.S. 64 (1938); Richards v. United States, 369 U.S. 1 (1962). In Richards, the negligence of Federal Aviation Administration employees located in Oklahoma caused an airplane crash in Missouri. Since Missouri and Oklahoma laws differed on the damages recoverable in wrongful death actions, the Supreme Court applied a two-step analysis to determine which state's substantive law on damages should be applied: First, the Court referred to the whole law of Oklahoma, the place of the negligent act, and applied Oklahoma's choice of law rules to the facts of the case. Since Oklahoma treated the place of the injury as the significant factor for choice of law purposes, the Court then examined the Missouri wrongful death statute to determine awardable damages.

b. Establishing duty. Duty must exist by virtue of state law under the private person analogy. It may be imposed by either a state statute or case precedent. Since the FTCA waives sovereign immunity only for violations of state law, the United States cannot be held liable under the FTCA for violation of a federal statute or regulation or for failure to perform a duty imposed by federal law. See Chen v. United States, 854 F.2 d 622 (2d Cir. 1988) (no liability for violation of federal manual); Wyler v. Korean Air Lines Co., Ltd., 928 F.2 d 1167 (D.C. Cir. 1991) (internal government directives that may benefit the public do not necessarily create duties to third persons); FTCH § II, B4a(1). However, claimants may use the United States' failure to follow its own regulations or SOPs as evidence of a breach of a duty created by state law (failure to follow internal hospital SOPs may be used as evidence of breach of the applicable state standard of care). Since the liability of the United States is equivalent to that of a private person under state law, common law duties may be greater or broader than those set forth in government manuals. See In Re Greenwood Air Crash, 873 F. Supp. 1257 (S.D. Ind. 1995) (common law duty to control aircraft is broader than that set forth in Federal Aviation Administration manual), FTCH § II, B4a(1).

c. Public duty doctrine. The extent of the United States' duty of care is a question whose answer is determined under state law.

(1) When the United States is sued for torts committed in the course of performing uniquely governmental functions, recovery normally is not allowed even if a state or local government would be liable under like circumstances, unless the action amounts to a state tort. The United States may not take advantage of immunities granted to state, county and municipal government officials, however. See Anderson v. United States, 55 F.3 d 1379 (9th Cir. 1995).

(2) Under the "public duty doctrine," as set forth in either state statutory or case law, government officers and agents are under the duty to protect citizens against various activities such as crimes, contagious diseases, and destruction of property by fire or manmade floods. This duty is owed to the public at large, not to individual citizens. Therefore, a breach of this duty to a specific citizen gives rise to neither a state nor a FTCA cause of action absent some special relationship or the breach of a specific duty owed to a specific individual.

(3) To create liability on the part of the United States for an action by one of its officers, the claimant must show either that the officer directly caused an injury to the claimant in particular or that the officer made a specific promise or representation to the claimant under circumstances creating justifiable reliance by the claimant.

(4) Decisions construing the FTCA have rarely held the United States liable for breach of a public duty because it is difficult to establish the requisite "special relationship" between claimant and a public official, which usually requires a finding of direct contact or privity between them, setting the claimant apart from the general public, FTCH § II, B4a(1)(j). See Sheridan v. United States, 823 F.2 d 820 (4th Cir. 1987), rev'd, 487 U.S. 392 (1988), summary judgment granted, 773 F. Supp. 786 (D. Md. 1991), aff'd, 969 F.2 d 72 (4th Cir. 1992). Held: Maryland law imposed no duty on the federal government to protect motorists from the intentional criminal acts of a Soldier who shot randomly at passing cars. Yet in a claim for child abuse based on a HCP's alleged failure to diagnose and prevent further injury, the physician-patient relationship may rise to the level of "special relationship," thereby creating a duty.

d. Fireman's rule. Under this state statutory or common law rule, state or local fire and police officers are barred from filing suit for injuries or death sustained in the performance of duty against those whose negligence or lack of care caused the fire. The fireman's rule is based on the premise that risk of such harm to firemen and policemen is inherent in their jobs, that they have assumed that risk, and that they are adequately compensated through a legislatively established compensation scheme. The rule may be, and has been, applied in FTCA actions to bar claims against the United States by local fire and police personnel who have been harmed by government personnel's tortious acts, FTCH § II, B4a(1)(m). The courts have carved out exceptions to the fireman's rule where the fire is intentionally set or when the injury is caused by an "independent actor," that is, one whose tort is independent of the misconduct to which the fireman or policeman has responded. For example, if a traffic officer who stops to issue a parking ticket is struck by a passing government driver, the traffic officer is not barred from filing suit against the passing motorist.

e. Examples of duties imposed by state law.

(1) Dram shop and social host liability. See paragraph 2-33 . When claimants allege that intoxicated government employees have caused personal injury or property damage, they may assert liability on the part of the United States based on either a state dram shop statute or common law negligence principles.

(a) At common law, it is not a tort to either sell or give alcoholic beverages to ordinary, able-bodied men (or women). Accordingly, in the absence of statute, those injured by an intoxicated person have no cause of action against the party who furnished the intoxicating beverage to the wrongdoer. The usual rationale for this rule is that the drinking, not the serving, of liquor is the proximate cause of the injury. Many states have enacted dram shop statutes which impose such liability and provide a remedy for someone injured by the intoxicated person who was served the liquor. In these states, liability under the dram shop statutes is directed at state-licensed commercial vendors of alcohol. Because Army clubs and Class-Six stores are not licensed by the state as vendors of alcohol, federal courts have held that state dram shop statutes do not create federal liability under the FTCA. See FTCH § II, B4a(1)(d). Additionally, as the FTCA does not impose absolute liability, and because most dram shop statutes are generally based on absolute liability, courts follow the Supreme Court's holding in Dalehite, supra, and do not apply the statutes to the United States.

(b) Some cases qualify the common law rule against imposing liability for furnishing alcohol to the extent of providing a right of action against someone who gives or sells alcohol to a person who is in such condition as to be deprived of willpower or responsibility for their behavior or to a habitual drunkard. A few federal courts have held Army clubs liable on this common law negligence principle. However, most states do not recognize "social host" liability. See FTCH § II, B4a(1)(d). Nevertheless, claims officers should be aware that social host liability may extend not only to the Army club system, but also to organization and office parties. It is essential, therefore, to investigate the facts thoroughly in each case and to research applicable state law.

(c) In cases arising outside the United States, the implementing regulations provide that claims will be evaluated under general principles of law applicable to a private individual in the majority of American jurisdictions. As dram shop liability is based on state statutes that have no extraterritoriality, it does not apply to claims arising overseas. Additionally, because social host liability is the exception rather than the rule in most American jurisdictions, it may not apply to these claims, whether they involve the Army club system or an office or an organization party.

(2) "Good Samaritan" doctrine and related statutes.

(a) The United States may be held liable for its agents' negligent failure to act as well as for affirmative conduct, but only if the applicable state law would impose a duty to act upon a private person similarly situated. A duty may arise under state law requiring that aid or assistance be rendered to one in need. There are statutory and judicially created classes of people to whom special protection is owed (persons under arrest, witnesses, school children requiring immunization), FTCH § II, B4a(1)(b). The discretionary function defense may be available in such cases (for example, if it is within the employee's discretion whether or not to render assistance, as well as how to render it). However, if state law does not impose an affirmative duty to act, such as in rescue cases, the United States will not be held liable for a failure to act even if the federal agency involved has a statutory responsibility to do so. See Bunting v. United States, 884 F.2 d 1143 (9th Cir. 1989) (Held: no duty on part of Coast Guard to go to the aid of downed pilot), FTCH § II, B4a(1)(b)(ii).

(b) Once the government assumes a function or service, it is under a duty to carry out that function or service in a non-negligent fashion. FTCH § II, B4a(1)(b). See Huber v. United States, 838 F.2 d 398 (9th Cir. 1988). For example, once the Coast Guard participates in a rescue, it must complete it properly. The "Good Samaritan" doctrine, based on common law and explained in the Restatement (2d) of Torts § 323, states that one who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of the other's person or property, is subject to liability to the other for physical harm resulting from his failure to exercise reasonable care to perform the undertaking if, by his actions, he increased the risk of harm or caused the other to detrimentally rely on him.

(c) Liability under the "Good Samaritan" doctrine has been limited in most states by the passage of Good Samaritan statutes, which shield those who stop to render aid and assistance from liability for simple negligence, but not for gross negligence. The qualified immunity granted by these Good Samaritan statutes may be applied to the United States under the private person analogy, shielding it from FTCA liability.

(3) Trespassers; the 'attractive nuisance' doctrine. See paragraph 2-27 .

(a) At common law, the nature and extent of the duty owed by a landowner to an individual depends on the individual's status as an invitee, a licensee, a guest or a trespasser. Research state law before initiating a claims investigation to ascertain whether or not these common law distinctions are still valid. In appropriate cases, learn whether the state in which the incident occurred has a "recreational use" statute applicable to the United States under the private person analogy. As a general rule, such recreational use statutes provide immunity from liability for simple negligence to landowners who make their land available without a fee to the general public.

(b) At common law, a landowner usually owed a higher duty of care to an individual who is invited onto the land or premises, particularly for business purposes, than to one who enters without invitation or permission. In general, landowners are not insurers of the safety of those who enter their land or premises with permission; instead, landowners are under the duty of reasonable care to protect them from dangerous conditions. Landowner liability turns on whether the landowner had actual or merely constructive knowledge of the dangerous condition; this issue is determined by reference to state law. Landowners may raise the defense that the condition causing the harm was "open and obvious" to the claimant, who remains under the common law duty to act reasonably and look out for personal safety. If the facts so indicate, the United States may invoke this defense by using the private person analogy.

(c) Trespassers are the third category of persons who may be injured on land. Generally, a landowner owes the trespasser only the duty not to act in a reckless or grossly negligent manner and to avoid creating "hidden traps" for the unwary. There are exceptions to this general rule. Liability attaches if an un-posted dangerous condition exists on the land or if the landowner is aware of frequent trespassing but fails to warn known trespassers (examples: the duty to properly mark a dud area to discourage trespassers, or warn of an unmarked wire strung across a trail used by motorcyclists). Additionally, if the trespasser is a child of "tender years" as determined by state law, then some states may hold the landowner liable for failing to take steps to prevent child trespassers from entering the premises, particularly if there is an "attractive nuisance," such as a swimming pool, on the property, FTCH § II, B4a(1)(g). In addition to visiting the scene and interviewing the allegedly responsible parties and the claimants, it is essential to talk to friends, neighbors and others in the community, such as local school boards and students, to determine not only the notoriety of the hazardous condition (how well known was it?) but also how often trespassing had occurred in the past and what steps, if any, the landowner had taken to prevent subsequent trespasses.

f. Duty to occupants of government quarters. The government's duty is similar to that of a landlord under state law: to provide safe habitation, FTCH § II, B4a(1)(h). Frequently, the federal government contracts out its responsibility for construction, maintenance, and repair of government quarters; in such cases, the independent contractor exception applies to shield the United States from FTCA liability. If the injured occupant was a Soldier, Feres usually bars a claim against the U.S.

g. Responsibility for the actions of third parties. The general rule is that, absent special circumstances, the United States is under no duty to anticipate and prevent the intentional or criminal acts of a third party. See Henry v. Merck and Co., Inc., 877 F.2 d 1489 (10th Cir. 1989). Exceptions to the general rule include cases in which the third party's tortious act was a reasonably foreseeable consequence of a government employee's negligent act, FTCH § II, B4a(1)(j). Additionally, the United States may be held liable if it had a special third-party relationship creating a duty to the victim, such as a psychiatrist's duty to warn a patient's intended victim of the foreseeable risk of harm that the patient posed. Usually a specific threat to a specific victim must be made before liability attaches; see Brady v. Hopper, 570 F. Supp. 1333 (D. Colo. 1983), aff'd, 751 F.2 d 329 (10th Cir. 1984).

h. Duty to report under state statute. State law may impose a duty on a government employee to report a criminal act such as child abuse. While failure to report is a criminal violation, it does not create civil liability for subsequent foreseeable injury to or death of the victim. Liability may exist, however, where an HCP does not meet the standard of care by failing to diagnose child abuse and protect the patient.

i. Professional standards of care. See paragraph 2-34m . At common law, the duty owed by those practicing the "learned professions" (law, medicine religion) was a general one, to do no harm. The definition of "professional" has now greatly expanded. Expert testimony is generally required to establish the duty owed by a member of a particular profession. To establish the nature and extent of the duty the United States owes in professional negligence cases, refer to the standards of the profession rather than to state statutes or common law. Most state court decisions hold that the applicable standard of care is that practiced by a reasonably prudent practitioner with the same or similar qualifications under the same or similar circumstances. Professional standards of care may be established in the administrative phase by reference to professional treatises and texts. Professional standards of care may also be established through expert testimony. Expert testimony may also be sought to establish not only the duty owed, but also causation. Federal Rule of Evidence 702. In Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993), the Supreme Court set forth four non-exclusive factors for the court to consider in conducting a preliminary assessment of whether the reasoning or methodology underlying the expert testimony is scientifically valid and whether that reasoning or methodology properly can be applied to the facts in issue. Those factors include: (1) whether the theory or technique can (and has been) tested; (2) whether the theory or technique has been subjected to peer review and publication; (3) a consideration of the known or potential rate of error and the existence and the maintenance of standards controlling the technique's operation; and (4) a consideration of the "general acceptance" of the theory or technique within the relevant scientific community; id. at pp. 593-595. The Daubert analysis has been extended to all expert testimony. See also Kumho Tire Co. v. Carmichael, 526 U.S. 137 (1999).

2-49. Breach of duty

The United States may not be held liable in tort unless there has been a breach of duty under applicable law. See FTCH § II, B4a(2).

a. Burden of proof. At trial, claimants have the burden of proof to establish that the United States breached a duty of care owed to them under state law. During the administrative claim phase, however, a claimant need only put the United States on sufficient notice to permit inquiry into the underlying facts. Therefore the United States, and thus an ACO or CPO, bears the burden to investigate thoroughly the facts of each claim and to determine whether liability exists.

b. Exceptions. Claimant is not under the burden of proof at trial in cases involving negligence per se, or the presence of negligence as a matter of law, which may arise from a state statutory violation or extreme wrongdoing, FTCH § II, B4a(2)(b).

c. Res ipsa loquitur. Another exception arises in cases involving the doctrine of res ipsa loquitur, wherein "the thing speaks for itself." This is a rebuttable presumption by which, using circumstantial evidence, the claimant shifts the burden onto the defendant. The following elements must exist: the defendant had exclusive control of the instrumentality which caused the injury; the incident would not have occurred in the absence of negligence; and the victim committed no contributory negligence. Notable examples of res ipsa loquitur include aircraft accidents, explosions and certain types of medical malpractice (the retained sponge cases). Res ipsa liability may not be imposed on multiple tortfeasors in the absence of joint responsibility, FTCH § II, B4a(2)(c).

d. Medical malpractice cases.

(1) Under common law, medical malpractice liability arose only within the context of the physician-patient relationship. State statutes routinely broaden the scope of potential liability to include non-physician HCPs such as opticians, pharmacists, midwives and paramedics. Additionally, state case law has expanded liability to settings outside the traditional HCP-patient relationship. For example, while not the general rule, liability has been found on the part of a radiologist who found an abnormality on an X-ray film taken as part of a pre-employment physical but who failed to warn the plaintiff about the abnormality, Daly v. United States, 946 F.2 d 1467 (9th Cir. 1991) (applying Washington law). If the subject of a pre-employment physical was a civilian employee, FECA would bar a tort claim.

(2) An HCP is not a guarantor of good results. An HCP who exercises reasonable medical judgment under the circumstances is not liable for a breach of the duty of care if subsequent events indicate an erroneous diagnosis or other mistake. It is important that a physician's care be judged upon only the facts known at the time of the incident (diagnosis or treatment), not what is learned later.

(3) To establish breach of a medical standard of care, most cases require a written opinion or oral testimony by a qualified medical professional in the same general practice or specialty as the defendant HCP. Exceptions are cases involving "common knowledge" (such as basic hygiene measures) and res ipsa loquitur. A bad result or adverse outcome alone is not sufficient evidence of a breach of the standard of care. A bad result in conjunction with poor or missing documentation of appropriate care, or the fact that an HCP's credentials have been stripped, however, could indicate the advisability of a settlement rather than the risk of an adverse judgment. See Welsh v. United States, 844 F.2 d 1239 (6th Cir. 1988), finding an adverse presumption against the government for destruction of critical evidence; Sweet v. Sisters of Providence in Washington, 895 P.2 d 484 ( Alaska 1995), negligence per se for the hospital and HCPs to fail to maintain or retain nursing records.

(4) A difference of medical opinion or practice is not sufficient evidence to establish a breach of the standard of care. The claimant's expert's opinion should be based on appropriate references to medical literature, not merely on what that expert's own practice is in a particular case.

(5) During the requisite interview in each claim, attempt to obtain not only the claimant's version of the facts but also the claimant's theory of liability and the specific instances believed to evidence a breach of duty. During the administrative stage, it is not prudent to request the claimant to submit an expert opinion supporting the allegations before conducting an initial inquiry into whether the government is exposed to potential liability. If an initial claims office investigation indicates that a breach of duty occurred, it is wiser to refrain from requesting such an opinion and spare the claimant the unnecessary expense. There is no duty to instruct the claimant and attorney about their case, and no benefit derived from doing so. It may be easier to negotiate a reasonable settlement when the claimant alleges minor injuries based on one theory of liability but, in fact, the United States is liable for major injuries for the same incident under another theory. As a general matter, however, before taking final denial action on a claim, send the claimant by certified mail a formal request for an expert opinion in support of the allegations. Where state law requires an affidavit of merit or medical expert opinion in order to file a medical malpractice suit, the claimant should be informed in writing of this requirement prior to final action. FTCH § I, B3c. See paragraphs 2-74 and 2-75 .

2-50. Causation

See FTCH § II, B4a(3). Liability exists only where the negligent or wrongful act or omission causes the damage or injury sustained. The mere existence of a negligent act does not establish liability. Posted on the USARCS Web site at "Claims Resources," II, a, no.17 are lists of cases showing both the traditional approach to causation as well as loss of chance rulings in all states that have ruled on these points of law. Note that the lists are current though August 2003 and should be shepardized.

a. Traditional test. The traditional test required plaintiff to prove injury by a preponderance of the evidence, showing that it was "more likely than not" that the injury was caused by a breach of a duty the defendant owed to the plaintiff. There can be no recovery of damages otherwise, FTCH § II, B4a.

b. Loss of chance. Some jurisdictions have relaxed the traditional test of proximate causation in medical malpractice cases in which the plaintiff must show that there was a "reasonable medical probability," or greater than 50 percent chance, that the HCP's negligence caused the patient's injury or death. In those jurisdictions, courts have allowed a plaintiff to prevail upon a showing that there was "some chance of survival" or a "substantial possibility of survival" or improvement in the patient's condition but for the defendant's breach of the duty of care. Under the MCA, general principles of American law do not support loss of chance as it is not considered to be the majority rule, FTCH § II, B4a(3)(b)(i). Many states have not adopted this loss of chance theory of causation. It is crucial to research state cases thoroughly to determine whether or not loss of chance applies to the facts of the claim. Additionally, states differ in the weight and effect they give to the finding that plaintiff experienced a loss of chance of survival as a result of defendant's negligent act. In some states, the plaintiff is entitled to recover the full measure of damages suffered; in others, the plaintiff may recover only those damages corresponding to the percentage of the lost chance, for example, a 30 percent loss of chance results in a recovery of 30 percent of the total awardable damages. A list of cases, organized by state, discussing both traditional and loss of chance causation in medical malpractice claims, is posted to the USARCS Web site at "Claims Resources," II, a, no. 17.

Section VI
Determination of Damages

2-51. Applicable law

Claims personnel should investigate damages and liability at the same time. The following statutes prohibit compensation for punitive damages, attorneys' fees, and costs associated with filing the claim:

a. Federal Tort Claims Act.

(1) In claims filed pursuant to 28 U.S.C. § 1346(b), the United States may be held liable for damage to or loss of property or personal injury or death caused by the negligent or wrongful act or omission of any employee of the government while acting within the scope of his or her office or 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. Thus, the whole law of the state of occurrence, including its conflicts of laws provisions, applies. See Erie R. Co. v. Tompkins, 304 U.S. 64 (1938); Richards v. United States, 369 U.S. 1 (1962). When the injured person is a resident of a state other than that in which the injury occurred, research both states' impact or comparative impairment rule. The law of the state of residence may apply to damages. Also consider that the legal theory of depecage may apply. Depecage permits application of the law from a state other than that where the incident arose on different aspects of a given case. Simon v. U.S., F3 d 193 (3d Cir. 2003). FTCH § II, C1a. See also paragraph 2-35 .

(2) Elements of compensable damage vary among the different states. It is imperative that each ACO or CPO research applicable state law on damages when handling FTCA claims. Each ACO and CPO should create a state law desk book containing legal research on damage issues in its geographic area of responsibility and update it regularly. Research the elements of damages in wrongful death and survival schemes, tort reform and no-fault statutes, and reported or published case decisions issued by the courts of each jurisdiction. Also, NATO SOFA claims that arise in the United States are adjudicated as FTCA claims; in other words, state law determines compensable damages.

b. Military Claims Act claims. AR 27-20, chapter 3 sets forth the applicable law on damages in claims under the MCA accruing on or after 1 September 1995. For claims accruing before 1 September 1995, compensable damages will be determined in accordance with the principles of general maritime law.

c. Foreign Claims Act claims. See para 10-4 . Allowable elements of damage vary in foreign countries. Refer to AR 27-20, chapter 3, as a guide for determining FCA damages.

d. Army Maritime Claims Settlement Act claims. Follow maritime law in determining damages. Applicable case law can be found in decisions under the Suits in Admiralty Act and the Public Vessels Act (46 U.S.C. §§ 31101-31113).

e. International Agreements Claims Act, 10 U.S.C. § 2734a and 10 U.S.C. § 2734b. Under the applicable international agreements (SOFAs), claims arising in the U.S. are processed as if the tortfeasor were a U.S. service member. See chapter 7 for further guidance.

f. Other costs. The following costs are not payable under any chapter of AR 27-20 .

(1) Costs of preparing, filing and pursuing a claim, including expert fees. Payment of costs is a matter between the claimant and attorney. The settlement or approval authority will make no effort to determine the value or the fairness of such costs. Settlement agreements will not include the value of costs even when the claimant and attorney agree on the amount.

(2) Bail, interest, prejudgment or otherwise, or court costs. See FTCH § II, C5 and 6 and 28 U.S.C. § 2411.

(3) Attorney fees, 28 U.S.C. §§ 2412, 2678. Under the American rule, attorney fees are deducted from the settlement amount; they are never considered payable as an addition to the settlement principal. The 20 percent attorney's fee limit established for all tort claims under AR 27-20 will be specifically set forth in any separate settlement agreement when neither Financial Management Service (FMS) 197 nor a payment report is used as a settlement agreement.

(4) Punitive damages, 28 U.S.C. § 2674.

(a) Punitive or exemplary damages are those damages not payable if they are in addition to special and general damages allowed under state or local law, maritime law, or under the MCA. Under the FTCA, compensation for unconscious pain and suffering or loss of enjoyment of life is not considered punitive where authorized by state law, Molzof v. United States, 502 U.S. 301 (1992). Similarly, under the FTCA, payment of damages already paid by a collateral source is not considered punitive. See FTCH § II, C3.

(b) In a wrongful death claim, the FTCA limits damages to actual compensatory losses measured by pecuniary injuries to the persons for whose benefit the action was brought. Certain state wrongful death statutes have been held to be punitive, FTCH § II, C3a.

2-52. Mitigation of damages

Always investigate this issue. Do not assume that claimants will mitigate damages automatically. Always advise in writing an unrepresented claimant directly or the claimant's attorney if represented, that damages must be mitigated. If you know that the claimant is not mitigating damages, be sure to inform the claimant explicitly and in writing that failure to do so will result in a deduction from any award. This practice prevents the claimant from asserting that the United States acquiesced in the claimant's actions.

a. In personal property damage claims, see paragraph 2-56 and cases cited in the FTCH § II, C13.

b. In a claim involving a commercial loss, see paragraph 2-56e , and the cases cited in the FTCH § II, C22, and 27.

c. In a claim involving physical injuries, mitigation may mean undergoing medical treatment. A claimant may not be forced to undergo medical treatment or required to have a surgical procedure to mitigate damages. If a claimant refuses to undergo recommended medical or surgical treatment, undertake a risk-versus-benefit analysis. If the claimant will not submit to a medical procedure, then the damages that the procedure would alleviate are not compensable, Verrett v. McDonough Marine Service, 705 F.2 d 1437 (5th Cir. 1983). Compare the known risks of the recommended surgical procedure (for example, is it routine and low-risk or complex and high-risk?) to the benefits expected from it (alleviation of pain and increase of function). If it appears upon analysis that a reasonably prudent person would submit to the surgical procedure, then the claimant may not recover for pain and suffering from the date a physician recommended the surgical procedure. See the cases cited in FTCH § II, C11.

d. In a claim involving physical injuries, examine the claimant's failure to follow medical orders as a possible failure to mitigate damages. In certain situations, it may rise to the level of contributory negligence. The claimant must fully understand the nature and reason for the medical order and should be questioned about his or her understanding of its meaning and necessity. Likewise, the health care provider should be queried concerning whether the claimant (patient) was fully informed as to the necessity and reason for the order. See the cases cited in FTCH § II, C12.

2-53. General damages

Carefully research which elements of general damages the applicable state law allows. Compensable general damage elements may include: pain and suffering, both past and future, physical disfigurement, mental or physical disability, loss of enjoyment of life, emotional distress, loss of consortium and survivors' mental anguish in wrongful death cases. A thorough claimant interview is necessary to assess each possible element of damages. As AR 27-20, chapter 3 states, the total award for non-economic damages under the MCA will not exceed $500,000. In light of the various state statutes establishing damage "caps" or ceilings and the DOJ's position supporting such caps, assess non-economic damages under all chapters of AR 27-20 with the $500,000 ceiling in mind. See the cases cited in the FTCH § II, C1b.

a. Pain and suffering. These elements are difficult to quantify because of their highly subjective nature. Reviewing the claimant's medical records and thoroughly interviewing the claimant, family members, and HCPs may provide insight. See the cases cited in FTCH § II, C16.

(1) To ascertain the extent of past pain and suffering, request copies of all medical and pharmacy records, chronologize each doctor's visit and prescription and note all record entries about improvement since the last visit. Study how the claimant described the pain's nature and extent to the HCP. Review these individual visits during the claimant interview. Note any references to prognoses made by the treating physicians or therapists and ask the claimant about any related discussions.

(2) Ask the claimant for a copy of a written report from the treating physician(s) before the claimant interview. It is important to obtain the written report of the physician or physicians who actually provided medical treatment to the injured person. Do not confuse this with a report written by a specialist, who has merely examined the claimant or injured person at the request of the claimant's attorney. In preparing a chronology of the claimant's medical treatment, be alert to the fact that in many instances, a treating physician may discharge the claimant from further treatment but the claimant may continue to seek treatment from a chiropractor, physical therapist, or other similar professional when the attorney suggests doing so.

(3) In assessing the severity of pain and suffering, claims personnel may seek assistance from DA physicians practicing the appropriate specialty at the local MTF. Review the medical records in detail with the physician to elicit a professional opinion regarding the nature of the injury, the reasonableness of the treatment provided to the claimant, such treatment's usual success rate and normal recovery time, any reasonably expected disability after recovery, and the reasonableness of claimant's complaints of pain and suffering. Remember that there is a big difference between the time it takes to get back on your feet after an operation and the time it takes for a normal body to heal thoroughly. Consult a medical specialist about concomitant effects of other surgeries or injuries, and conduct an IME if indicated at an MTF even if the claimant is not otherwise entitled to care at an MTF, AR 27-20, paragraph 1-14 .

(4) In some circumstances, and after discussion with the AAO, consider an IME by an independent medical examiner to assess future pain and suffering. (See para 2-34 .) In arranging an IME, choose an examiner or team of examiners who are experienced in the particular area of medicine involved in the claim's specific allegations. If possible, the IME should be scheduled in the same geographic area or region as the claimant's place of residence. Consult with your AAO for specific information on procedures for setting up an IME. Prepare questions designed to elicit the information necessary to determine the full nature and extent of the injuries. These may be included in the letter arranging for the IME. Ascertain whether, in the IME examiner's or team's opinion, remedial care or treatment is indicated, its current costs, and usual success rate. A sample letter arranging for an IME is posted on the USARCS Web site at "Claims Resources," II, a, no. 19. See also AR 27-20, paragraph 2-21 which further discusses the use of consultants and appraisers.

(5) Never use a factoring method to quantify pain and suffering (that is, do not multiply the special damages by an arbitrary number to arrive at a sum). Following the steps suggested here should result in a fair evaluation and proper dollar amounts.

b. Loss of enjoyment of life. Also known as hedonic damages, loss of enjoyment of life may include impairment of mental health, loss or impairment of one of the senses, inability to participate in daily, family, or recreational activities, interference with sexual relations or childbearing, and shortening of life expectancy. A list of states permitting the loss of enjoyment of life element is posted on the USARCS Web site at "Claims Resources," II, a, no. 16. The FTCA permits compensation for loss of enjoyment of life as an element of damages if the applicable state law recognizes it as such. It is also allowable under the MCA; see AR 27-20, chapter 3 . In certain jurisdictions, pain and suffering may include loss of enjoyment of life. In others, however, pain and suffering and loss of enjoyment of life may be separately compensable. Research whether the state has codified life expectancy tables. In their absence, calculate life expectancy by using the "Present Value" and "Future Damage" calculator tables published annually by the Lawyers and Judges Publishing Company. These tools are based on mortality information published annually by the Bureau of Labor Statistics. By using them one can estimate life expectancy, work-life expectancy, and present value of anticipated future earnings. All AAOs at USARCS have these tools available and can assist with these calculations. The amount of damages allowed is tied directly to life expectancy; therefore, be aware that the life expectancy tables or charts provide normal life expectancy. An individual claimant may have a less than normal life expectancy (a "rated age") due to a congenital or medical condition. The loss of enjoyment of life is assessed over the individual claimant's life expectancy. See FTCH § II, C17. Hedonic damages may overlap other elements of damage, so avoid granting double recovery when calculating this element of damages.

c. Emotional distress. This element of damages usually covers mental suffering resulting from grief, anxiety, fright, and despair.

(1) For claims brought pursuant to the FTCA, research applicable state law to learn the elements claimants must prove to receive compensation for emotional distress in the absence of any physical impact to each claimant. See FTCH § II, B1c(4) and II, C8, and 28.

(2) Under the MCA, claims for negligent infliction of emotional distress are limited by AR 27-20, paragraph 3-5a(3)(g) .

(3) Claims for intentional infliction of emotional distress do not require physical impact and should be evaluated in accordance with the applicable state law or under the MCA, with the majority rule in American jurisdictions.

(4) Moral damages.

(a) Local law applies to emotional distress claims brought under the FCA. However, the element of damages set forth in AR 27-20, paragraph 3-5 , usually will provide adequate guidance. Additionally, moral damages are permitted if the law of the country of occurrence permits them. Moral damages are those affecting the health, welfare, and happiness of the injured or deceased person's immediate family members, such as spouse, children (including children born out of wedlock), parents or grandparents. Countries that follow the Civil Code permit moral damages. The value of these moral damages is based in part on the nature of the claimant's relationship to the person injured, not on the relationship alone. For example, a child who has left home and severed ties with an injured parent would be entitled to a nominal award at best.

(b) There is no requirement that the claimant witness the injury or death or that the injury or death cause a physical impact. If either or both of these factors are actually present, the value could increase.

(c) The nature and severity of the harm form a basis for assessing the amount. Moral damages were allowed when an airline failed to inform its passengers that they needed a visa to enter Spain and one of them, a cancer patient, died one year after he was denied a chance to visit his homeland, Compagnie Nationale Air France v. Castano, 358 F.3 d 203 (1st Cir. 1966). A court also awarded moral damages to a wife who, for four weeks, cared for her 265-pound husband whose twisted knee prevented him from walking. The court concluded that Puerto Rican law did not consider basic conjugal duties part of compensable moral damages, Ganapolsky v. Park Gardens Development Corp., 439 F.2 d 844 (1st Cir. 1971). Moral damages were awarded to a wife who tried to have her husband, who had suffered a heart attack, admitted to a federal government hospital. That hospital discharged him to a psychiatric hospital, which in turn transferred him to yet a third hospital where he died shortly after arrival. The court found that the thought of their three children left fatherless intensified the wife's anguish, Santa v. United States, 252 F. Supp 615 (D.P.R. 1966). The nature of the relationship has to be one of affection. Lopez Nieves v. Vergel, 939 F. Supp. 124 (D.P.R. 1996).

(d) Exercise care to distinguish moral damages from loss of consortium in a personal injury case. Moral damage in a wrongful death case is akin to compensation for survivors' mental anguish. Some American jurisdictions permit it, but AR 27-20, chapter 3 , does not.

d. Physical disfigurement. Some states do not permit physical disfigurement as a separate element. To establish this element of damages, conduct a complete review of the medical records and interview the claimant, claimant's family members, and HCPs. In addition, a plastic surgeon may need to conduct an IME or review recent 8-inch by 10-inch color photographs taken by a medical photographer. If an IME is not required, review the physical disfigurement claim with a plastic surgeon to ascertain the possibility of any reconstructive surgery, its likelihood of success and anticipated cost, and whether there is any chance that the disfiguring condition will improve in time without surgery. Since many MTFs do not have a qualified plastic surgeon, telemedicine can be used to obtain the necessary review. A resource for this is the Telemedicine Directorate, Walter Reed Army Medical Center at 202-782-7908.

e. Loss of consortium. An injured spouse may recover for the loss of consortium, that is, loss of love, companionship, society, affection, conjugal fellowship, and sexual relations. Interview the claimant and acquaintances to determine the nature of the relationship both before and after the injury. Some jurisdictions recognize a child's loss of a parent's consortium as an element of damages, FTCH § II, C25. It is common practice to file a claim for child's loss of a parent's consortium even though the applicable state law does not recognize such a claim. The claimant should be informed upon filing of this, thereby avoiding the need to withdrawal or deny such claim upon settlement of the claim for the parent's injuries. The MCA does not permit this type of claim, AR 27-20, paragraph 3-5b(1)(b) .

2-54. Special damages

Because elements of special damages vary among states, it is critical to know which are compensable in the particular state. Some typical special damage elements are past lost wages, loss of future income or earning capacity, past out-of-pocket medical expenses, future medical expenses, loss of household services, and any loss stemming from a permanent disability. When confronted with an economist's report from a claimant or claimant's attorney asserting some or all of these damage elements, consult the AAO to obtain an economist's report for rebuttal, if necessary.

a. Loss of past income. In addition to loss of salary, this element of damages includes both fringe benefits and leave, such as the employer's contribution to Social Security, bonuses, sick and annual leave, employer health insurance benefits, free (covered) housing or transportation, and pension benefits, FTCH § II, C10. It may also represent loss of profit from a business, FTCH § II, C14.

(1) The amount of loss should be established through the claimant's past federal income tax returns (returns for three to five years preceding the injury or death is generally appropriate). Request them as soon as you anticipate a damages award, informing the claimant or claimant's attorney that there is no substitute for these returns. A claimant may submit W-2 forms to substantiate past income; while useable, they may show earnings only as of the date of injury or death. It is necessary to see the entire amount of family income declared to apply the proper income tax offset.

(2) It may be difficult to determine certain types of income, such as tips. If the claimant earned this type of income but did not report it on past federal income tax returns, do not exclude it altogether as an element of damages. If the claimant did earn and report this income on past federal income tax returns, claims personnel may average the past amounts or, in the alternative, estimate the amount using information obtained from co-workers or similarly employed individuals.

b. Loss of future income or earning capacity. The claimant must establish that this loss is reasonably certain to occur. This element of damages may represent a temporary loss of future earnings due to physical injury or to a total loss of future income or earning capacity in cases of catastrophic injury. To calculate this element of damages for an adult with an established work history, average the claimant's past earnings for a period of five years immediately preceding the accident or injury. For a child without an established work history, refer to the parents' educational level and assume that the child would have graduated high school or college if the parents did.

(1) In situations involving allegations of loss of future earnings due to temporary disability, the claimant must establish the temporary disability with medical evidence from the treating physician. There is often a conflict between the claimant's desire or lack of desire to return to work and the physician's medical opinion of the claimant's ability to return to work. Rely on the physician's statement in determining whether to allow a temporary loss of future earnings. For example, a claimant with a back injury may feel subjective pain and believe that he or she is unable to return to work despite the physician's objective findings that the injury has healed and there is no physical basis for the claimant's complaints. This may represent a situation in which the claimant has developed a psychological condition, such as post-traumatic stress disorder, as a result of the back injury. In this case, the claimant must prove the contention of temporary disability with medical evidence from a neurologist or other physician who has examined the claimant and administered appropriate diagnostic tests to support the diagnosis of a temporary disability.

(2) In situations involving catastrophic injuries and a total loss of future earnings, calculate the loss over the claimant's future work life. Be aware that a future work life is normally shorter than an individual's normal remaining life expectancy because it is assumed that an individual will retire from the work force before the end of normal life expectancy. Making this calculation includes data on work life expectancy as discussed in paragraph 2-53b .

(3) During the course of the interview, determine the claimant's complete earnings/work history and potential by asking questions about educational experience, actual employment with previous employers, and any plans for future education or career changes. Request copies of all employment and personnel records, school records, and tax returns. The Bureau of Labor Statistics can provide economic information about similar jobs. Remember that the claimant has the duty to mitigate any loss of future earnings or earning capacity. See the cases cited in the FTCH § II, C14h and i.

(4) In personal injury cases, lost future earnings must be reduced to their present value and reduced by the value of income taxes, unless the amount of earned income is low. FTCH § II, C10e. In wrongful death cases, this element should also be reduced for the decedent's personal consumption to determine the actual loss to the survivors. There are various methods for reducing economic damages to present value; applying a discount rate between 1 and 3 percent is a general rule. See AR 27-20, chapter 3 ; see Jones & Laughlin Steel Corp. v. Pfeiffer, 462 U.S. 523 (1983), Culver v. Slater Boat Co., 688 F.2 d 324 (5th Cir. 1982), reversed by 722 F.2 d 114 (5th Cir. 1983), cert. denied, 469 U.S. 819 (1984). See the cases cited in FTCH § II, C14. Georgia has a statutory discount rate. An example of the methodology for calculating lost future earnings is posted on the USARCS Web site at "Claims Resources," II, a, no. 20.

c. Permanent disability or injury. This may be a separate element of damages or it may be the basis for a total loss of future earnings. The permanence of an alleged disability or injury should be ascertained through an IME. See AR 27-20, paragraphs 2-21 and 2-24 and of this publication. Additionally, conduct a thorough review of all available medical records that reflect treatment by both military and civilian physicians or therapists. It is important to explore the impact of a permanent disability on future lost earnings or earning capacity with the IME reviewer and treating physicians or therapists.

(1) Request a written statement from the claimant's treating physician(s), setting forth the basis for the contention of permanent disability or impairment. This statement should be prepared by the treating physician(s).

(2) Always try to have an orthopedist or related specialist evaluate orthopedic injuries. When the specialist is reluctant to state a numerical rating, request an opinion on everyday activity limitations. Several publications are available to assist attorneys in the evaluation of permanent impairment. Among these are the Guides to the Evaluation of Permanent Impairment published by the American Medical Association, available for purchase through the American Medical Association Web site, or available at USARCS by contacting your AAO. Additionally, 38 C.F.R. Part 4, the Schedule for Rating Disabilities of the Department of Veterans Affairs, is a useful tool to assist attorneys in evaluation of permanent impairment.

(3) Allegations of permanent disability due to emotional or psychological injuries are more difficult to evaluate. Assistance from a neurologist, psychiatrist or associated professional, such as a psychologist or therapist at the local MTF, is invaluable in assessing these allegations.

d. Loss of household services. This element provides compensation for performing household services that the injured party would normally perform but for the injury. Calculate by multiplying the average or regional hourly or weekly wage (obtained from the Bureau of Labor Statistics) times the number of hours the person performed the services. Such services may include housekeeping, cooking, yard maintenance, and/or childcare/rearing. Information concerning the specific activities of the claimant's household should be established during the claimant interview.

e. Medical expenses, past, and future. Reasonable and necessary medical expenses are compensable.

(1) This element may cover the value of nursing or attendant care furnished by a member of the immediate family to another member, as when a parent stops working outside the home to provide nursing or attendant services to the child. The value of such services is the market value of a similar level of nursing or attendant services, not of the family member's regular employment.

(2) A claim for past medical expenses, if filed, is paid to the person responsible for furnishing the care, such as to a parent who pays for a child's care. Future medical expenses may be paid to either the guardian or custodial parent until a child reaches adulthood or directly to the child after majority. A medical trust should be used to ensure availability of funds for a child's future medical care.

(3) For past medical expenses, the claimant must submit copies of actual bills and medical records from hospitals, physicians or therapists, rather than the attorney's estimate. Review the medical records to ensure that the bills reflect treatment arising from the claimed injury or death. When the costs appear excessive, have a physician at the local MTF review the records.

(4) The majority rule is that future medical expenses are compensable only when based on a physician's report, not on a medical economist's report. In certain situations, it may be necessary to establish a reversionary medical trust for payment of future medical costs over time. See AR 27-20, paragraph 2-63 . In those cases, a life-care plan (a projection of all the injured party's future medical and life-care needs) may be needed to estimate future medical expenses. Develop this in consultation with the AAO and a structured settlement broker.

(5) In any interview with the claimant it is important to learn the nature and extent of necessary future medical care anticipated and all costs associated therewith. This information helps claims personnel determine whether a structured settlement or a cash only settlement offer is appropriate under the particular circumstances.

(6) Normally, future medical expenses are not discounted as the rate of inflation exceeds interest rates. A zero discount rate is usually used. The difference is made up by using a medical trust in which the annuity feeding the trust is increased monthly by a percentage (such as 3 or 4 percent).

2-55. Wrongful death claims

At common law, survivors had no right of recovery for wrongful death. Such recovery is a creation of state statutory law. For FTCA claims, refer to the appropriate state statute(s). For MCA and FCA claims, the elements recoverable are set forth in AR 27-20, paragraph 3-5c . Since permissible damages may vary widely under state wrongful death and survival statutes, it is imperative to research the appropriate jurisdiction's law. There are two types of losses. One is to the estate; the other, loss to the beneficiaries or survivors, usually limited by statute to family members. Some states permit recovery for both in separate actions; other states have combined the two types of claims in one statute. In a few states the statute is limited to loss to the estate. See comments below.

a. Loss to beneficiaries. This method focuses on compensating the decedent's beneficiaries for the loss of the economic benefit they reasonably could have expected to receive from the decedent. This represents a pure wrongful death cause of action. Under the FTCA, elements of damages, depending on applicable state law, may consist of some or all of the following:

(1) Loss of financial contributions and support.

(2) Loss of services.

(3) Loss of nurture, guidance, care, and training of minors.

(4) Loss of society, comfort, love, and affection.

(5) Loss of inheritance or net accumulation.

b. Loss to the estate. In states where loss to survivors includes the elements in a above, loss to the estate is limited to medical expenses and pre-death pain and suffering This is true whether there are two statutes or one combined statute. Several states, for example, Georgia, have defined loss to the estate as being the gross future earnings of the estate reduced by a statutory discount rate; earnings may include the pecuniary value of contributions to the survivors such as services and the value of the relationship. Such a statute conflicts with the FTCA in that it states that liability is limited to the actual or compensatory damages measured by the eligible survivor's pecuniary loss, 28 U.S.C. § 2674. In most states, pecuniary loss is calculated as set forth in subparagraph d below.

c. Other damages recoverable. Recovery for the deceased person's medical and funeral expenses and pain and suffering from the time of injury to the time of death is usually allowable as a loss to the estate under a survival of actions statute. Mental anguish of the survivors may also be allowable. In any event, research state law to determine the allowable damages.

d. MCA damages. Under the MCA, the allowable elements of damages in wrongful death claims, as set forth in AR 27-20, paragraph 3-5c , are divided into economic and noneconomic loss. Eligible claimants are limited to the decedent's spouse, parent, child or dependent relative. A separate amount must be stated for each claimant where represented by one party.

(1) Economic loss. The following elements of economic loss are compensable:

(a) Loss of a family member's financial support from the date of injury causing death until the end of work-life expectancy. Estimates of this future monetary support must be discounted to present value at one to three percent, after deducting for taxes and personal consumption.

(b) Loss of retirement benefits are compensable and similarly discounted after deductions.

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

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

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

(2) Noneconomic loss. The following elements of noneconomic loss are compensable.

(a) Pre-death conscious pain and suffering.

(b) 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.

(c) 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 reaches 18 years of age.

e. Interview of survivors. When interviewing survivors in a wrongful death claim, frame questions to ascertain the individual decedent's family relationships, future plans and sources of income, to construct a settlement placing the family members in the same financial position they would have been in had the decedent lived. Review the Claimant Interview Checklist, posted on the USARCS Web site at "Claims Resources," II, a, no. 5, and see the guidance on interviewing claimants at paragraph 2-23 .

f. Assessment of information. One needs to assess the information obtained to determine whether a structured settlement or an all cash settlement offer is appropriate, based on the claim's particular circumstances. Consider the following cases:

(1) Claimant A is a sole surviving spouse, age 50, who is gainfully employed in his own right. His routine financial needs are already met by his own salary and fringe benefit package and his personal investments. An all cash settlement offer might appear appropriate in this situation. During the interview, however, the claimant reveals that he has two adult children both of whom are independently wealthy but have demonstrated spendthrift tendencies. He expresses concern over his four grandchildren's future financial condition. Assuming these additional considerations, an offer of a structured settlement with deferred payments may be more appropriate because it may be tailored to the claimant's financial desires or needs.

(2) Claimant B is a surviving spouse, age 29, who is on active duty and has three minor children, all of whom are under age 10. A structured settlement offer is appropriate in this situation because it provides income over a period of time, ensuring that there will be adequate financial resources to permit the widowed active duty Soldier to provide a stable home environment during each child's years of minority. In addition, future payments may be scheduled to provide income for all the children after they reach the age of majority.

2-56. Property damage or loss

a. Definition. Such claims are limited to loss of, or damage to, actual or tangible property. Compensation does not include consequential damages, such as loss of a semester of school or a job due to erroneous enlistment, loss due to issuance of improper orders or charges for services furnished by a fire department. Research the remedies set forth in paragraph 2-17 . For additional examples of consequential damages, see paragraph 3-4b .

b. Property damage. The method of determining damage to property varies depending on the circumstances of the loss and the condition of the property. Initially, the adjudicator must determine whether the property is economically repairable, that is, where the cost of restoration exceeds the pre-accident value of the property. Determine the cost of repairs and compare with the value of the property at the time of loss. In making this calculation add a factor of depreciated value due to repairs (10 to 20 percent) for high value items, cost of towing and loss of use. For example, the value of the vehicle at the time of loss is $60,000. The cost of repairing it is $55,000. As it has a one-of-a-kind piece of equipment it must be towed 500 miles for repair costing $3,000. To the foregoing add a factor of 15 per cent or $4,000 for reduction in marketability if properly repaired. Thus the cost of repair is $62,000 which exceeds the pre-accident value of the vehicle. This formula can be applied to non-commercial vehicles, particularly where the repair requires parts to be obtained from a distant location, increasing the value of loss of use. The foregoing illustrates the need for paying property claims expeditiously. In order to use the split claims procedure discussed at AR 27-20, paragraph 2-48 and paragraph 2-70 of this publication, notice to your AAO is necessary where the amount exceeds your monetary jurisdiction.

(1) Diminution in value. Take the property's fair market value immediately before the loss and subtract its residual value. Use this method of determining damage in total or constructive total loss situations and in cases where property is not totally destroyed. See the cases cited in the FTCH § II, C19.

(2) Cost of repair. This is the cost necessary to restore real or personal property to its pre-loss condition. Payment for estimates or actual repairs is limited to the expense necessary to restore the damaged personal property substantially to its pre-damage condition. To determine whether the property is economically repairable, the cost of repairs should not exceed the property' s pre-damage value. Appreciation or an increase in value associated with the repairs is deductible from the cost of repairs. However, an allowance of 10 to 20 percent depreciation in future marketability may be added to the cost of repair where it will not effectively restore the property to its pre-damage value. This allowance usually applies to recently purchased high-value items.

(3) Lost or unrepairable property. For lost personal property or for property which is not economically repairable, compensation will comprise the pre-damage value minus salvage where applicable. Depreciation may be based on guidance set forth in the Allowance List Depreciation Guide posted on the USARCS Web site at "Claims Resources," III, no. 1.

c. Loss of use of property. This element of damages depends on state law. Normally, it is limited to economically repairable property for the period of time required to repair the property. One's lack of funds to repair does not extend the period of loss. However, loss of use may be allowed for the period of time needed to obtain a replacement even though there is a total loss. For example, in an automobile accident claim, assume that the claimant's car is a total loss. The claimant owns only one car and needs it to perform the essential activities of daily living, such as going to work and to the grocery store. The claimant is entitled to recover the cost of renting a car similar to the totaled car for the length of time it would normally take to buy a replacement car. However, lack of funds to obtain a replacement does not justify failure to replace and does not justify excessive rental charges. It is necessary to substantiate rental of similar property or the expense of substitute capability.

d. Towing and storage charges. These are normally allowable elements of damages, provided the charges are reasonable and necessary. For example, fees for towing a disabled vehicle to a nearby repair facility are allowable but fees for towing a disabled vehicle from New York to Virginia are not because they are not reasonable. Even when a car is a total loss, towing charges are allowable to determine if it is economically repairable or simply to get it off the road. Normally, storage charges are allowable only for the length of time it takes to determine if the vehicle is economically repairable, and if it is, to have the car repaired, which includes downtime at the repair facility while waiting for parts. Storage charges for totaled vehicles are authorized only for the length of time necessary to determine that the vehicle is not economically repairable.

e. Loss of business or profits. This element is limited to direct interference by physical damage to a commercial enterprise, such as a retail outlet or commercial vehicle. It must be evidenced by an unavoidable interruption, such as time to repair a building or vehicle. Direct proof that there was an actual loss is required. Damages for loss of opportunity are speculative and not allowable. For example, if the claimant is a commercial trucking firm which has 50 trucks available for use but usually has actual contracts that keep only 40 trucks busy, then damage to one of the claimant's trucks would not cause a loss of profits because other trucks remain in the fleet to fulfill the contracts. In that situation, only the costs of repair of the damaged truck, not lost profits, are recoverable. However, if the business regularly kept all 50 of its trucks busy, then damage to one truck might require the business to rent a substitute vehicle in order to fulfill the contractual commitments already in place. If a substitute truck is rented and the rental fee includes the cost of a driver for the rental truck, deduct the salary the claimant normally pays its driver (who cannot drive the rental truck) and the costs associated with the operation of the truck in calculating the damages. See the cases cited in the FTCH § II, C22. Consult the AAO on questions concerning loss of business or commercial profits.

f. Overhead. This is the cost not of filing a claim but of administering actual repairs, such as those made by a public utility. Generally, overhead beyond 10 percent must be strictly proven as being necessitated by the repair project. Read the following cases on permissible overhead charges. See also FTCH § II, C21.

(1) Department of Water and Power of Los Angeles v. United States, 131 F. Supp. 329 (S.D. Cal. 1955).

(2) United States v. Peavey Barge Line, 748 F.2 d 395 (7th Cir. 1984).

(3) Shappert Engineering Co. v. Steel City Marine Transport Inc., 620 F. Supp. 1377 (E.D. Mo. 1985).

(4) United States v. Motor Vessel Gopher State, 614 F.2 d 1186 (8th Cir. 1980).

(5) United States v. Denver & Rio Grande Western R.R. Co., 547 F.2 d 1101 (10th Cir.1977).

(6) Freeport Sulphur Co. v. S.S. Hermosa, 526 F.2 d 300 (5th Cir. 1976).

g. Special situations of property loss or damage.

(1) Registered or insured mail. If the loss occurs while the article is in Military Postal Service channels, the insured or registered value is the measure of damages. Since the Military Postal Service operates under procedures similar to those of the U.S. Postal Service, the risks of loss are substantially the same as the sender chose to insure against. If the loss occurs while the article is in general military possession, such as that of a unit clerk, but after it has left the Military Postal Service, the measure of damages is determined in the same way as any other MCA property damage claim.

(2) Annual crops. The allowable compensation is based on the number of acres or other unit measure, the average yield per acre in the neighborhood, the degree of crop maturity, and price on the local market at maturity reduced by the anticipated cost of production (cultivation, harvesting, storage, and marketing).

(3) Perennial crops, including tree plantations or pasture land. The allowable compensation is ordinarily the amount of damage to the growing crop plus the diminution in the land's value.

(4) Timberland, excluding tree plantations. Generally, the allowable compensation is the difference between the before and after value of the land and the stand. To evaluate the stand, determine the value of the trees by their age at the time of their loss, not at maturity.

(5) Turf and soil. The allowable compensation is generally the cost of reconditioning the soil to its former state, provided the cost does not exceed the land's value. If the damage is permanent, the allowable compensation is the difference between the before and after values of the land.

(6) Domestic animals and fowl.

(a) The general rule, that the measure of damages for the loss or destruction of property is ordinarily its market value, applies to animals and fowl. In determining the market value, an animal's particular qualities and capabilities may be considered. When an animal has no market value, damages may be based on its actual or intrinsic value or its value to the owner. The measure of damages for animals having special breeding value, or which have been bred, generally is based on market value only. Normally, an allowance for the anticipated progeny is not authorized as it would constitute a double award. Disallowance is based on the presumption that the market value is established and determined by the special value of the injured animals as breeders. Accordingly, the value of the anticipated progeny is included in determining an animal's market value.

(b) Allowable compensation in cases involving damage to agricultural ventures conducted for profit, such as dairy, poultry and fur farms, is usually measured by determining the extent of lost profits and additional expenses resulting from the incident. Property damage such as loss of milk base or government subsidy payments is also compensable if definitely ascertainable. Although the damages' nature and origin must be clearly ascertained, the liable party may not escape its obligation merely because the damages are difficult to ascertain or impossible to measure precisely. In these cases, the measure of damages usually can be determined by records from previous years if the claimant had an established business. Reports from dealers, veterinarians, and agricultural extension agents are similarly relevant in determining or verifying production statistics, normal mortality rates, and other data necessary for an informed computation of the claimant's net loss.

(7) Shade trees. These are usually defined as trees that shade a dwelling. In determining the monetary value of shade and ornamental trees, the following factors must be considered: size, class, condition, and location. A list of trees growing in a specified area must be segregated into classes based on relative value. Trees in class I are valued at 100 percent, class II at 80 percent, class III at 60 percent, class IV at 40 percent, and class V at 20 percent. Texas A&M University Extension Forestry Service, on the Web site at http://extensionforestry.tamu.edu/publications/shadetree1.htm, can provide more information on valuing shade trees. This Web site includes a list of which species have been placed into which classes.

h. Use of appraisers. See paragraph 2-24 for guidance on when to use appraisers. Wherever possible, arrange with the claimant to agree upon an appraiser and split the cost. Always make certain that the claimant or their representative is present to point out the damage.

i. Estimate of damage to vehicles.

(1) Settling vehicle claims usually requires the use of damage estimates from body shops, car dealerships and insurance companies. An estimate is usually prepared according to a standard sequence. This sequence should be reflected on the estimate sheet that the body shop prepares. Be suspicious if the repair estimate jumps around and does not seem to follow a sequence.

(a) Starting at the front.

(b) Examining under the hood.

(c) Examining the exterior beginning at the left front side and going to the rear and then up the right side to the front.

(2) The body shop must then estimate the cost of the labor and materials to repair the car. Most shops use an estimating guide, which resembles a large telephone directory and is published monthly or quarterly. Chilton ( http://www.chiltonsonline.com ) publishes estimating guides as well as separate issues for domestic, foreign, and older cars. Each guide contains useful general information about estimating damages as well as specific information about each make and model it covers. The guide also has diagrams providing great detail about how to make specific repairs.

(3) Using an estimating guide allows the repair shop to estimate the cost of repairs fairly and to ensure that it is adequately paid for its work. By using an estimating guide, the shop avoids overcharging. Insurance companies require adjustors to check estimates for overcharges. "Overlap" is an excess labor charge that results from a body shop charging for duplicate repair operations to adjacent components. For example, the place where a quarter panel joins a rear panel is considered overlap. Less time is required to remove both together than separately and the repair estimate should be reduced accordingly. Estimating guides contain detailed discussions and deductions for overlap.

(4) "Included operations" are tasks that can be performed separately but are also part of another operation. For example, replacing a fender panel may include the time to remove and replace the headlight assembly and aim the headlight. Separate labor charges for replacing the fender panel, replacing the headlight, and aiming it are unwarranted and may double the repair estimate. Estimating guides list operations separately and allow you to spot included operations.

(5) Estimates may include a charge for hidden damage or damage that the estimator cannot assess until the vehicle is taken apart. Hidden damage may also be listed as an open item on an estimate. Always call the body shop and inquire about open items. Estimating guides, with their detailed "blow apart" diagrams of automobile components, help spot hidden damage. Sometimes simply questioning the estimate will resolve the matter and cause the body shop to remove the charge or estimate the cost of repair satisfactorily.

(6) Normally, loss of use is limited to those situations in which the claimant needs a rental car because a car is essential to the claimant's family (as in cases where the claimant's family has only one car for everyday use). It is not allowable for rental of a substitute vehicle for recreational purposes. Normally, loss of use is payable for the length of time it takes to get the car repaired, starting from the time of the accident. If the car is drivable, and the claimant can use the vehicle pending receipt of parts, then loss of use is allowed only for the time needed to actually repair the car or as stated by a repair facility report. Claims officers are encouraged to inspect damaged vehicles themselves; they should arrange with the local garage to expedite repair work on cars involved in claims.

(7) Many body shops estimate repair work according to the factory list price for new parts in the estimating guide, then repair the car with discounted, used or reconditioned parts. In many cases, the claimant is not entitled to replacement of damaged parts with new parts, if used parts will return a used car to substantially the same condition that it was in before the accident. Body shops routinely use rechromed bumpers, used wheel covers, fenders and other nonmoving parts. Always negotiate this point with the body shop and the claimant.

(8) Glass is almost always subject to a substantial discount. Check repair shops that specialize in replacing glass to determine their estimate to repair it. The cost may be substantially less than that charged by a body shop or car dealership.

(9) Always deduct for fair wear and tear on tires and ensure that claimant's tires are replaced with the same type and quality of tire. Either use a tire depth gauge to measure the depth of existing tread or call a store that sells the same tire. Avoid allowing a body shop to list a price for tires when the claimant can purchase them elsewhere at a discount.

(10) A claimant is entitled to recover the cost to repaint an area damaged in a collision. Sometimes a body shop will allege that the entire car must be repainted so the paint will match; make the body shop justify this claim. Automobile identification numbers include codes identifying the paint applied during manufacture. A body shop uses these codes to mix paint to match the existing paint job. If paint cannot be mixed to match, the discrepancy may be because the existing paint has oxidized or weathered. In this case, deduct for appreciation from the estimate because the claimant is in a better position after repair than before the damage to the car.

(11) Claims offices that process a significant number of automobile damage claims should evaluate automobile damage estimates aggressively. Use the local motor pool garage to assist in evaluating a claimant's estimate. Subscribe to an estimating guide to check damage estimates.

2-57. Collateral source rule

a. Generally. The collateral source rule allows the victim of a tort to recover for damages caused by the tortfeasor regardless of compensation received from other independent or "collateral" sources. Thus, the collateral source doctrine permits a tort victim to recover more than once for the same injury, provided these recoveries come from different sources. For example, an accident victim may recover medical expenses from a tortfeasor even though the victim's own insurance policy covers such costs. The rationale for the doctrine is that a double recovery may be justified where the claimant supplied the original source for the recovery (the claimant's own insurance policy) from resources (the cost of the insurance policy) that would otherwise have been available for other purposes (the claimant could have used that money to purchase a new car). A few states are limiting the collateral source doctrine. Make sure that any allowance for collateral source payments under the FTCA accord with state law.

b. Federal government as tortfeasor. When the federal government is the tortfeasor, questions arise as to what, if any, payments under other federal programs or by other federal agencies the adjudicator may use to offset the damages otherwise payable to a claimant. The general rule is that whether a setoff is available to the government depends on the source of the other federal payment. If the payment is made from unfunded general revenues of the United States, a setoff or deduction is usually permitted because FTCA awards are disbursed from general revenues. See Feeley v. United States, 337 F.2 d 924 (3d Cir. 1964) (both DVA hospital benefits and FTCA recoveries are funded from general revenues). If the payment comes from a special fund into which the claimant made contributions, then it is considered "collateral" and no setoff or deduction is permitted. See Smith v. United States, 587 F.2 d 1013 (3d Cir. 1978). Since Social Security benefits are funded almost entirely from employer and employee contributions and not from general revenues, these benefits are collateral. See the cases cited in the FTCH § II, C10.

c. MCA or FCA claims. The collateral source doctrine does not apply to MCA or FCA claims.

d. TRICARE benefits. TRICARE benefits are not a collateral source. See the cases cited in the FTCH § II, C10h.

e. Past medical care furnished at government expense. Past medical care furnished at government expense, such as at an MTF, is not a collateral source. See the cases cited in the FTCH § II, C10a and g.

f. DVA benefits. DVA benefits, either monetary or medical, should be considered in calculating damages. In some cases, past benefits should be credited against the award and future benefits should be deducted from it.

(1) Settlements for service-connected disabilities. See paragraph 2-73 for more information on drafting settlement agreements.

(a) When monetary benefits are paid for the injury claimed and the claim is not barred by the incident-to-service doctrine, past benefits should be credited against the award and future benefits should be deducted from it, Brooks v. United States, 337 U.S. 49 (1949). These benefits include disability compensation (38 U.S.C. §§ 1110, 1131), dependency and indemnity compensation (38 U.S.C. § 410(a)), specially adapted housing (38 U.S.C. § 2102), a specially adapted automobile (38 U.S.C. § 1310), vocational rehabilitation benefits (38 U.S.C. chapter 31), dependents' education benefits (38 U.S.C. chapter 35) and clothing allowance (38 U.S.C. §1162). Disability compensation may include an additional benefit for requiring an attendant, without regard to whether or not the veteran actually employs one, 38 U.S.C. § 1114. Disability compensation and dependency and indemnity compensation will continue to be paid regardless of any tort settlement or judgment. There is no statutory mechanism for suspending these benefits because of a tort award. Thus, to avoid a double recovery, the amount of a tort settlement or judgment must be reduced by the amount of these past and future DVA benefits.

(b) When the injury on which a claim is based aggravates a service-connected disability, the claimant's benefits may be increased to reflect the increased severity of the disability. In negotiating a settlement in such a case, limit the credit to the increased compensation. When the claimant is a retiree, the proper deduction is the excess of increased benefits over retired pay, O'Keefe v. United States, 490 F. Supp. 70 (W.D. Okla. 1980).

(c) When the claim is for injury or death arising from care furnished a veteran or retiree on behalf of the DVA (by designation, agreement or otherwise) for other than a service-connected disability for which compensation will be increased, the individual may qualify for benefits under 38 U.S.C. § 1151. This permits payment of disability or death benefits as if the injury incurred in medical treatment were service-connected. A DVA award under § 1151 entitles eligible service-connected veterans to medical and home nursing care. In negotiating a settlement when § 1151 benefits are being paid, credit past benefits to reduce the settlement amount. However, since the tort settlement does not credit future § 1151 benefits, notify the DVA about the settlement or judgment. Upon receiving such notification, the DVA will suspend future § 1151 benefits by statutory mandate until the amount that it would have paid the claimant completely offsets the amount of the tort settlement or judgment, including attorney's fees.

(d) Eligibility for future DVA medical care will be lost during the period monetary benefits are suspended unless the settlement or judgment expressly provides that medical care shall continue, 38 U.S.C. § 1710(a)(2)(C). However, the monetary benefits themselves cannot be similarly continued by agreement between the government and the claimant. To reduce the tort award for medical expenses, ensure that a provision to that effect is included in the settlement or judgment.

(e) A claim may be brought for the death of an individual whom the DVA rated totally disabled for a specific period before death and whose death was not caused or aggravated by the total service-connected disability (such as a traffic accident on a military base). In such a case, death benefits as though the death were service-connected may be paid under 38 U.S.C. § 1318(b). Past benefits under this section should be credited toward the tort award. DVA will suspend future benefits under 38 U.S.C. § 1151 until the total amount of the settlement or judgment is offset. Thus, there should be no credit for future benefits in the tort award. Notify the DVA about the settlement or judgment.

(2) Settlements involving DVA pension for nonservice connected disability or death. When the subject of a claim results in the permanent and total disability or death of a wartime veteran, the veteran or the veteran's survivors may be eligible for DVA disability or death pension under 38 U.S.C. chapter 15. The claimant must meet stringent income limitations, however. These benefits are need-based and any tort claim settlement will count as income, resulting in their reduction or termination. Credit past pension benefits paid for the disability or death for which a tort claim is made in the settlement or judgment and consider future pension benefits lost because of the increase in income from the tort settlement in evaluating the case.

(3) Medical care for non-service-connected disability. When a claimant needs home nursing care or rehabilitation services for injuries that are not service-connected, the DVA may be able to provide such care on a space-available basis, 38 U.S.C. §§ 1710, 1720. By their nature, these services are not available at MTFs. It may be possible to use DVA care to limit medical expenses during protracted settlement negotiations or litigation. Realistically, however, DVA home nursing care often will not be available.

g. Medicare liens. Although Medicare benefits are sometimes considered a collateral source, claimants are not compensated for payments made to them or on their behalf under Medicare. The Centers for Medicare and Medicaid Services (CMMS), U.S. Department of Health and Human Services, considers a lien to exist in the amount of Medicare benefits expended as a consequence of the Army's tortious conduct. Coordinate with the AAO before settling any claim involving Medicare benefits. Financial Management Service (FMS) will pay CMMS directly and USARCS can negotiate the amount to be paid directly with CMMS. Special language is required in the settlement agreement if there is a Medicaid lien. See paragraph 2-73 for more information on drafting settlement agreements.

h. Medicaid liens. Where there is an outstanding lien in favor of a state agency for past medical or equipment expenses due to the state's implementation of a program using Medicaid funds, the state agency will generally negotiate repayment of a percentage of the total amount expended and may permit the claimant's attorney to deduct an attorney's fee on the amount of the lien. Usually, the claimant's attorney is responsible for notifying the appropriate state agency that a settlement with the United States is going to take place. Therefore, in drafting a settlement involving a Medicaid lien, negotiate a reduced lien amount. Usually, it is possible to reduce the attorney's fee by agreement. If there are other possible defenses, demand a further reduction. If the attorney is unwilling to waive the fee on the amount of the lien, then consider attributing a fixed amount to the lien (less than the lien's full amount since you know that the claimant's attorney will negotiate to repay the state less than the full amount of the lien) and include that fixed amount in the up front cash payment during negotiations. See paragraph 2-73 for more information on drafting settlement agreements.

2-58. Subrogation

a. Subrogation arises from the substitution of one person in the place of another with regard to a claim, demand or right. Insurance companies generally have a right of subrogation for the benefits paid to their insured. In the absence of a right to subrogation, the claimant is entitled to the amount of loss paid by a third party, subject to the collateral source rule. The difference between a subrogee and a lienholder is a matter of state law.

b. A lienholder may not file a separate claim. In claims where there are lienholders or potential lienholders the settlement agreement must include release of claims language naming all of the lienholders and potential lienholders. Paragraph 2-6b discusses properly identifying a party with subrogation rights. A sample settlement agreement containing release language directed at lienholders, or potential lienholders, is posted on the USARCS Web site at "Claims Resources," II, b, no. 8. Paragraph 2-73 (Settlement Agreements) discusses settlement agreements in detail.

c. Subrogated claims are payable under AR 27-20, chapters 4 , 8 , and Section III (Claims in Foreign countries) of chapter 7.

d. Subrogated claims are not payable under AR 27-20, chapters 3 , 5 , 6 , and 10 .

Section VII
Evaluation

2-59. General rules and guidelines

The claim evaluation is linked to the liability and damages determinations and, in fact, constitutes a bridge between them. Taking this step involves weighing factors common to all negligence claims but unique to each, such as the factual circumstances surrounding the injury or loss, witnesses' credibility, the existence or absence of physical or documentary evidence and its probative value.

a. Rules. Settlement and approval authorities evaluate claims based on the extent of government liability and the injuries resulting therefrom. Apply the following rules to gauge a claim's strengths or weaknesses and to determine whether to settle it or deny it with a view toward litigation or appeal.

(1) Claims with a jurisdictional or procedural bar normally should not be settled. Claims arising from combat operations or barred by the incident-to-service exclusion or FECA are not paid. This rule applies when the law precludes recovery and there is no set of facts allowing the claimant to overcome the defense. Claims that may be barred by the statute of limitations may be compromised in certain circumstances. For example, both parents individually and on behalf of their child file a claim for birth injuries which occurred ten years previously and for which they have known the cause for at least eight years. The father has been in the Army continuously since the birth. Assuming liability, deny all claims but the father's. Due to the Servicemembers Civil Relief Act, 50 U.S.C. app. §§ 501-596 (history: Oct. 17, 1940, chapter 888; § 1 of Act of Dec. 19, 2003, P.L. 108-189 ; formerly the Soldiers and Sailors Civil Relief Act of 1940, codified at 50 U.S.C. app. §§ 101-165 and originally codified in 1918, but amended from time to time), he may be reimbursed for the added costs of raising and caring for the damaged child during minority and, depending on the degree of disability and state law, during adulthood, but not for emotional injuries or loss of services or consortium.

(2) Completely frivolous claims should not be settled. When there are no facts supporting the claim or no state law tort exists, deny the claim. A claimant does not become entitled to recover damages merely by filing a claim. Promptly investigate and deny such claims instead of executing a "nuisance settlement." Often, suit may be avoided by informing the claimant what facts the investigation disclosed.

(3) Cases in which liability is not in doubt or liability may be probable should be settled. If investigation reveals that the United States cannot defend on liability, attempt to settle the claim. Usually there are liability issues which should be used in adjudicating damages proportionate to the exposure of the United States to a possible adverse judgment. If the claimant asks if liability is being conceded, answer by stating that on FTCA or MCA cases only the Department of Justice has that authority. In any event, it is a non-issue as you are attempting to enter negotiations to pay the claim. Open settlement negotiations by asking the claimant to provide damage information and then fully investigate each recoverable element. Seek the claimant's attorney's cooperation in establishing damages. Consult the AAO on claims in which liability is doubtful.

b. Guidelines.

(1) Local law. A knowledge of applicable law is essential. Know which elements of damages the jurisdiction recognizes. See Section VI , Determination of Damages.

(2) Alternative sources of compensation. The federal government funds a number of social insurance programs, such as Medicare, Medicaid and DVA benefits. If the claimant is entitled to them, help the claimant tap these alternative means of compensation in the following ways:

(a) Contact the offices responsible for processing and approving the claim for benefits. Find a responsible official who can help determine if benefits are available. If the claimant is entitled to benefits, personally contact the individual employee who will assist the claimant in applying for them.

(b) Learn whether the benefits available to the claimant are a collateral source. Even if you determine that they are, take the position that any settlement entered should reflect the benefits the claimant receives. See paragraph 2-57 .

(c) Approach the claimant's attorney with a settlement package that includes the benefits. This reduces the likelihood that the claimant will try to assert the collateral source doctrine. If you are seen as trying to help the claimant, settlement will be easier.

(3) Coordination with the local Office of the U.S. Attorney. Knowing the local U.S. Attorney's policies on litigating or settling tort claims will help determine the value of claims in which liability is in doubt. Discuss the claim, and various ideas about and approaches to settlement, with an Assistant U.S. Attorney. Keep memoranda of these conversations.

(4) Factoring methods. Never resort to factoring methods or valuation handbooks to determine a claim's settlement value. Not all "whiplash" cases in which the claimant incurred $1,000 of medical expenses are alike. The specific facts in each case will dictate the damages. A claimant's attorney who tries to use a factoring approach is usually doing so because the facts have not been fully developed or they weigh against the claimant. Take a look at the facts and the law; then make an offer.

(5) Reported cases. Study reported cases on excessive and inadequate damages awarded for the same or similar injuries, paying particular attention to how their facts differ from those in the claimant's case. See FTCH § II, C16 and 28.

(6) Past and future damages. Evaluate past and future damages separately when determining a claim's settlement value. See Section VI, Determination of Damages, for a detailed discussion about payable damages.

2-60. Claims memorandum of opinion

Upon completion of the investigation and determination of liability and damages, the ACO or CPO will prepare a memorandum of opinion on claims which must be forwarded to USARCS for action. This requirement to write a memorandum may be waived for a given claim by agreement between the ACO or CPO and the AAO. Compose the report in the following format:

a. Identifying data.

(1) Each claimant's or plaintiff's name, current address, permanent address, date of birth, and social security number (SSN).

(2) Each attorney's name, address, and telephone number.

(3) Date and place of incident.

(4) Date and amount of claim or ad damnum of complaint.

(5) Brief (one-sentence) description of claim or case.

(6) Actual or potential companion claims (their nature and status).

b. Jurisdiction. Discuss any applicable statute(s), whether the claim was timely and properly filed and other jurisdictional matters.

c. Facts. Provide a complete statement of the facts upon which the claim and any defenses thereto are predicated. In each instance in which witness statements support a fact, make reference to an exhibit documenting the fact. Use subparagraphs with descriptive headings, if appropriate (for example, background facts or facts about the incident).

d. Legal analysis. List issues related to liability and the controlling law with applicable citations. Again, use subparagraphs with descriptive headings as appropriate and necessary (for example: law controlling factual issues, factual bases for the claim as related to each issue, duty, proximate cause, defenses, existence of joint tortfeasors). If the claim is barred by a jurisdictional defense, for example, Feres, FECA, or the SOL, discuss this separately. State your position on liability at the end of the section.

e. Damages. Discuss the following issues under appropriate subheadings in the order listed:

(1) Who may claim under applicable law.

(2) Elements of damages for wrongful death or personal injuries.

(3) Description of injuries and treatment, including the injured party's or decedent' s pre-morbid life expectancy.

(4) Description of property loss and proof offered.

(5) Types of special damages (such as loss of earnings, loss of services, past and future medical care).

(6) Type of noneconomic or general damages (use a summary in tabular form, if necessary, for special and general damages).

(7) Effect of diminished liability on the claims value.

(8) Effect of subrogation, if any, and the subrogor's identity.

f. Proposed settlement or action. Discuss any proposed structured settlement. Discuss any prior offers or negotiations and their status. If a denial or final offer is indicated, so state.

g. Recommendation. State whether the claim should be denied or settled. A recommendation to settle a claim should include a monetary range.

h. Documents and witness list.

(1) The witness list will include the name, SSN, telephone number, and present and permanent address for each witness or medical reviewer.

(2) Identify each document in the file.

i. Responses to pleadings. (for claims in litigation only).

(1) Proposed answer.

(2) Defenses.

(3) Counterclaims.

(4) Cross claims.

(5) Dispositive motions (identify and list).

2-61. Joint tortfeasors

When federal and non-federal joint tortfeasors are involved, either concurrently or successively, in a tort in which a claim against the United States has been filed, several issues arise. It is crucial to know the applicable law because the presence of additional tortfeasors, or other parties from whom recovery may be obtained separately or through indemnity or contribution, complicates the evaluation process. To evaluate all actual or potential claims in such a case, it is necessary to weigh the relative strengths and weaknesses of each tortfeasor's defense.

a. Federal Tort Claims Act. The common and statutory law of the state where the claim arose, including its conflicts of law rules, controls how joint tortfeasors will share legal liability. Each claims office should maintain and periodically review and update its state law desk book on this topic.

b. Military Claims Act. The doctrine of joint and several liability does not apply to claims occurring on or after 1 September 1995. The United States will be liable only for its own negligence on a proportional basis.

c. Foreign Claims Act. The law of the place where the claim arose determines federal liability under the FCA. In most instances, the United States will be liable only for its own negligence on a proportionatal basis. However, claims personnel will deduct for any insurance recovery or any amount reasonably expected to be recovered which has been or will be paid to the claimant. Claims personnel will take appropriate steps, such as obtaining an assignment, when an insurance settlement is not reasonably available. Deductions will also be made for any other amounts recovered or reasonably expected to be recovered from a tortfeasor or the third party as a result of the injuries or loss giving rise to the claim.

d. National Guard Claims Act. The United States may have a remedy for contribution from the state that employed the tortious National Guard Soldier or employee. Such a remedy may arise from any of three actions: the state has waived its sovereign immunity and is a self-insurer, has purchased liability insurance coverage, or has executed an agreement with the Army to share the cost of administrative claims settlements to which both the Army and the state are parties.

e. Army Maritime Claims Settlement Act. This statute provides for the administrative settlement and compromise of admiralty and maritime claims both in favor of and against the United States. General maritime law has long recognized the concept of proportional fault, which applies to claims against the government. In addition, the Army is authorized by statute to demand compensation for damage to property it owns or property under its jurisdiction or for which the DA has assumed third-party liability, 10 U.S.C. § 4803. The DA is further authorized to seek compensation for any salvage services performed by it or its authorized contractors, 10 U.S.C. § 4804.

f. General concepts.

(1) At common law, there is no right of contribution among joint tortfeasors. In re General Dynamics Asbestos Cases, 602 F. Supp. 497 (D. Conn. 1984). Many state courts have adopted the doctrine of joint and several liability, in which one tortfeasor may be held liable for all damages regardless of its share of liability.

(2) Other states have enacted some form of the model statute "Uniform Contribution Among Joint Tortfeasors Act," which permits an equitable apportionment of damages. Some states (such as Kansas and Louisiana) adhere to the doctrine of proportional fault, while others (Texas) permit non-settling defendants a credit for amounts paid by settling or adjudged defendants. Where another tortfeasor has been adjudged liable or has already settled with the claimant, it is important to review the pre-judgment stipulation or settlement documents to determine whether the United States has been released from all claims, Barrett v. United States, 668 F. Supp. 339 (S.D. N.Y. 1987) aff' d 853 F.2 d 124 (2d Cir. 1988), cert. denied, 488 U.S. 1041 (1988). AR 27-20 implements other statutes that impose or allow proportional fault.

g. Identifying the joint tortfeasor.

(1) This step is critical to the analysis. Who are joint tortfeasors? Either the parties must act together in committing the wrong or their acts, if independent of each other, must unite in causing a single injury. As an example, if Driver X and Driver Y collide and injure Claimant C after and as a result of negligent traffic directions that a public safety or construction employee gave Driver Y, all parties are joint tortfeasors. In some factual situations, the damages may be apportioned among two or more causes where there are distinct harms or where a reasonable basis exists for determining the contribution of each cause to a single harm.

(2) Some states permit division of both liability and damages; the parties are then considered successive, not joint, tortfeasors. This fact-driven conclusion depends greatly on the extent to which the injuries or damages may be allocated or severed between the separate or competing causes and tortfeasors. Apportioning damages according to a fair share of liability allows direct, independent compensation by a third-party tortfeasor.

(3) In other states, the harm is severable into distinct parts, as when a person receives subsequent negligent medical treatment. As a matter of public policy, the original tortfeasor often will be held responsible for all subsequent harm, unless the preponderance of the evidence proves that later harm resulted from an intervening force caused by a superseding tortfeasor. See Restatement (2d) of Torts §§ 433A, 439, 441-453.

(4) Regardless of the facts, some tortfeasors, such as state or local governments or the injured party's employer, remain immune from suit by the injured party so that indemnity or contribution from them may not be available, Hill v. United States, 453 F.2 d 839 (6th Cir. 1972). The United States may bring an action against a state but doing so is difficult and requires the Attorney General's permission. See FTCH § II, D5b.

2-62. Indemnity or contribution

See also paragraph 2-15f (third-party claims involving a federal contractor) , 2-15k (motor vehicle damage claims arising from the use of non-government vehicles), 2-45a , b , and c (FECA and contractors), and 2-58 (subrogation).

a. Sought by the United States from a non-federal third party. The claims investigation and analysis of the tortfeasors' respective liabilities may lead claims personnel to conclude that the United States is entitled to contribution or indemnity, under either a contract theory or the applicable local law governing joint tortfeasors. If so, pursue it. A table that provides a list of state indemnity and contribution laws is posted on the USARCS Web site at "Claims Resources," II, a, no. 15.

(1) The injured claimant might plead equitable tolling of the statute of limitations if the United States did not provide timely notice of the existence of another tortfeasor, such as a contractor or its employee. Avoid this problem by providing prompt written notice to the other tortfeasor and to the claimant. It is the policy of both the DOJ and USARCS that the government notify the other tortfeasor of the claim and ask it to honor its contractual obligation to the United States or accept its share of joint liability.

(2) Provide the other tortfeasor a copy of the claim, setting forth the factual and legal bases for the government's request for indemnity or contribution as well as notice that 28 U.S.C. § 2415 provides the United States a lengthy period in which to enforce its request. That law grants the United States six years in which to file a complaint and to pursue a right of action in contract, or three years in tort, from the date the government's right to indemnity or contribution accrues. Citing this provision in a notice to another tortfeasor may seem premature because, as a practical matter, these rights do not accrue until either judgment is entered against the United States or the government pays a settlement. A party has no right to seek indemnity or contribution until its liability is fixed. The intent of providing the notice, however, is to impress upon the tortfeasor that 28 U.S.C. § 2415, not state law, imposes the applicable statute of limitations for any third-party action, which will not even begin while the administrative claim process is pending. Thus, the tortfeasor's delay will not hinder prosecution of the government's right of action. The tortfeasor should also be encouraged to forward the notice and request to its counsel or insurer so they may contact the claims office.

(3) Notify the claimant at the same time as the tortfeasor, providing information about the tortfeasor's identity and insurer (if known) and copies of all information and notice provided to the tortfeasor. If the claimant's right of action against the tortfeasor under local law seems clear, strongly encourage the claimant to file suit against the tortfeasor. This way, the government gains maximum leverage over a party otherwise reluctant to participate in settlement discussions.

(4) The key to obtaining the other tortfeasor's participation and contribution is a dialogue between the parties.

(a) The result will be enhanced by cooperating with the other tortfeasor in the claim investigation and by sharing information already developed, much as one shares with a claimant. The two parties' interests are not compatible, however. The claimant seeks compensation now; the tortfeasor seeks to delay paying compensation as long as possible. Thus, sharing discoverable information may accommodate those intrinsically opposed interests. Establishing common ground for agreement, much as a mediator would, goes a long way toward obtaining the other tortfeasor's participation in the settlement.

(b) Usually, the claimant and the other tortfeasor are content to negotiate through the ACO or CPO rather than directly with each other. At times, the other tortfeasor will permit the ACO or CPO to negotiate its interest as well. This situation is best as long as all liable parties maintain close communication and agree on their respective shares and offers, and the negotiating tortfeasor keeps the other tortfeasor abreast of the negotiations. This allows the ACO or CPO to control the dialogue through the information that flows between or among the other parties and to maximize the amount or share the third party is willing to contribute to a settlement.

(c) Full payment may be made in either of two ways. The United States may pay the entire claim and then accept proportionate contribution from the other tortfeasor or each liable party may pay its agreed share directly to the claimant. Be aware that either the liability insurance policy limits or a state statutory damage cap may limit the other tortfeasor's contribution. Depending on the extent of the claimant's injuries and its own insured's liability, the other tortfeasor's insurer may be willing to tender its policy limits rather than risk an allegation of negotiating in bad faith. When a legal and factual analysis leads to the conclusion that the other tortfeasor bears greater liability (for example, with custodial and maintenance contractors at commissaries and hospitals), tender the defense of the claim to that tortfeasor.

(5) If the issue of indemnity or contribution is not adjusted satisfactorily, the claim will be compromised or settled only after consulting with the AAO. In these situations, pay particular attention to the scope of the language in the settlement agreement. It should specify that the settlement covers only those injuries and damage caused by the negligence of the United States and does not release the other tortfeasor. Otherwise, in many states, a settlement will release the other tortfeasor, thus jeopardizing any right of action the claimant, and perhaps the United States, may have against it.

(6) When the claimant refuses to accept an offer of an amount the appropriate settlement authority has determined to be the United States' fair share, it is better to deny the claim than to pay the entire amount and then to seek contribution or indemnification from the other tortfeasor. This avoids the necessity of convincing the U.S. Attorney to file an affirmative claim and permits joinder of the other tortfeasor as a third-party defendant.

b. Sought from a federal contractor.

(1) Often, the United States will share liability with a federal contractor in injury or wrongful death claims arising at worksites or MTFs by an employee of the contractor or its subcontractor. In a worksite case, in addition to reviewing state law, scrutinize the federal contract carefully to ascertain whether it contains language identical or similar to that employed in United States v. Seckinger, 397 U.S. 203 (1970) to the effect that the contractor "shall be responsible for all damages to persons or property that occur as a result of his fault or negligence in connection with the prosecution of the work." Such language creates a contractual cause of action for indemnity or contribution, regardless of how state law treats joint tortfeasors, even if the contractor is immune under the state workers' compensation statute (as when the claimant is a contractor employee). Some courts have held that a Seckinger clause is implied despite the fact that the contract does not contain such a clause. Courts have interpreted the Seckinger clause as permitting a form of proportional fault in which the United States is liable only for its own negligence. See FTCH § II, D6.

(2) It is imperative, therefore, that claims personnel obtain and review the contract promptly in any claim arising from a worksite injury or death and assess whether contractor employees met the applicable standards of performance. With HCPs, such as TRICARE partnership providers, civilian contract HCPs, or scarce medical specialists hired at a fixed annual sum, the ACO or CPO should ascertain whether the contract provides personal or nonpersonal services.

(3) The ACO and CPO will continue to focus their investigations on the factual issues necessary to resolve whether the principal lacked authority to control the contractor's physical conduct in its performance or whether it maintained supervision and control of its day-to-day operations. They will look at, for example, the type of medical services rendered, whether a written contract exists, whether they used off-base offices or military office space or kept regular office hours. Cases discussing these points include:

(a) Broussard v. United States, 989 F.2 d 171 (5th Cir. 1993).

(b) Lurch v. United States, 719 F.2 d 333 (10th Cir. 1983); cert. denied, 466 U.S. 927 (1984).

(c) Lilly v. Fieldstone, 876 F.2 d 857 (10th Cir. 1989).

(d) Bird v. United States, 949 F.2 d 1079 (10th Cir. 1991).

c. Sought by the United States from a state as the result of Army National Guard activities. See paragraphs 2-15e , 2-17d , and chapter 6 .

(1) If a state provides a remedy because it has either waived its sovereign immunity or purchased liability insurance coverage, the responsible area claims authority will monitor the action against the state or its insurer and encourage direct settlement between the claimant and the state or its insurer.

(2) If the state is insured, it is preferable for the ACO to pursue direct contact with the state ARNG point of contact (listed on the USARCS Web site at "Claims Resources," VI, a) rather than with its insurer. Establish and follow regular procedures designed to ensure that federal and local authorities do not issue conflicting instructions for processing claims and that, when possible, they arrange for the disposition of such claims in accordance with local and federal law. The appropriate claims and local authorities should agree on such procedures, subject to concurrence of the Commander USARCS.

(3) A settlement or approval authority will deduct from the amount otherwise payable amounts recovered or recoverable by the claimant from any insurer, other than the claimant's insurer, which has obtained a subrogated interest against the United States.

(4) A settlement or approval authority may seek contribution from an involved state that has waived sovereign immunity or maintains private insurance to cover the incident giving rise to the claim. If the state denies the request for contribution, forward the file to the Commander USARCS, who is authorized to enter into an agreement with a state, territory, or commonwealth to share the settlement costs of claims generated by the ARNG personnel or activities of that political entity.

(5) Advise the claimant about any remedy available against the state or its insurer. If the payment by the state or its insurer does not fully compensate the claimant, the settlement or approval authority may pay an additional amount. If liability is clear and the claimant settles with the state or its insurer for less than the maximum amount recoverable, the settlement or approval authority will deduct the difference between the maximum amount recoverable and the settlement amount from its payment.

(6) If the state or its insurer seeks to pay less than its maximum jurisdiction or policy limit, but agrees to pay 50 percent or more of the entire claim's actual value, any federal payment must be made directly to the claimant. The settlement or approval authority may accomplish this by either paying the entire amount to the claimant and seeking reimbursement from the state or its insurer for their portions, or having each party pay its agreed share directly to the claimant.

(7) If the state or its insurer seeks to pay less than 50 percent of the claim's actual value and the claimant has filed an administrative claim against the United States, forward the file with the tort claims memorandum to the Commander USARCS. Include information on the status of any judicial or administrative action the claimant has taken against the state or its insurer. The Commander USARCS will determine whether the claimant will be required to exhaust all remedies against the State or its insurer or whether the settlement or approval authority may settle the claim against the United States without requiring the claimant to pursue those remedies. If the Commander USARCS approves the second course of action, the settlement or approval authority will also determine whether to seek an assignment of the claim against the state or its insurer, notifying the state or its insurer in accordance with state law that either party may seek contribution or indemnification.

d. Sought from vehicle insurers of federal employees. If the United States is potentially liable for the operation of a federal employee's POV or rental car, the contractual language may hold that the United States is an additional named insured under the policy covering the POV, Government Employees Insurance Co. v. United States, 349 F.2 d 83 (10th Cir. 1965), cert. denied, 382 U.S. 1026 (1966). This may be true even if the policy contains a clause excluding coverage, Government Employees Insurance Co. v. United States, 400 F.2 d 172 (10th Cir. 1968). Additionally, the law of the state where the insurance contract was executed may invalidate the exclusionary clause. When interviewing the federal employee, ascertain whether the rental agency reduced the premium in any way because of the FTCA exclusion. Where the insurer settles with the injured party, the general rule is that the United States is not released but is entitled to an offset should the injured party file a claim against it. If no settlement has occurred, the ACO or CPO should obtain and review a copy of the insurance policy and request contribution from the insurance company. See FTCH § II, D8.

e. Sought from rental car companies or their insurers. See also paragraphs 2-15k (Determining the correct statute), 2-25 (Investigating motor vehicle accident claims), and 2-61 (Joint tortfeasors) and in AR 27-20, see paragraphs 2-15k (Determining the correct statute), and 2-48 (Splitting personal injury and property damage claims).

(1) The Army has been successful in tendering to a rental company or its insurer the defense of third-party claims arising from the authorized use of a rental vehicle by an employee acting within the scope of employment.

(a) The United States Government Car Rental Agreement applies to the Army; most car rental companies in the United States are signatories to it. The contract is administered by the Contracting Office, Surface Deployment and Distribution Command (SDDC) (formerly the Military Traffic Management Command (MTMC)) ( http://www.sddc.army.mil/ ). The agreement mandates that the signatories must provide to the United States and its employees minimum insurance coverage of $100,000 for injury to each individual in an accident, $300,000 for all individuals in an accident, and $25,000 for property damage from any one accident.

(b) The agreement intends this coverage to be the primary mode of recovery against the United States, serving as the equivalent of an excess limits policy. The coverage is to be maintained solely at the cost of the car rental companies and its conditions, restrictions, and exclusions shall not be less favorable to the United States and its employees than those afforded under standard automobile liability policies. For damage to the rented vehicle only, the government Visa travel card provides coverage for the entire vehicle.

(c) The exceptions to recovery under this agreement include willful and wanton misconduct by the Army driver, obtaining the vehicle through fraud or misrepresentation, operation of the vehicle under the influence of alcohol or any prohibited drugs, and operation by a person other than the authorized Army driver. However, the agreement states that authorized drivers include "the renter's fellow employees" while acting within the scope of their employment.

(d) When a claim is filed against the United States, the ACO or CPO should obtain the employee's travel orders and vehicle rental agreement. Attempt to obtain a written acknowledgment of insurance coverage from the rental car company. Inform the claimant about the rental car company's responsibility. Maintain contact with the company or its insurer to monitor the status of any claim filed against either entity. If the value of damages exceeds the policy limits investigate the incident. Attempt to determine liability. If a claim is filed against the United States and it is obvious that the policy limit will be exceeded, the ACO or CPO, in conjunction with the AAO, should determine whether the rental agency or the United States will act as lead defendant.

(e) If the Army employee is personally sued, the ACO or CPO should notify the rental car company or its insurer immediately since failure to do so may result in a denial of coverage under applicable local law. Some jurisdictions permit the injured party to sue the rental car company directly, which then will attempt to sue the United States or its employee for indemnification. In either situation, notify the Litigation Division. See AR 27-40, chapter 4 .

(2) A claims office should expect to see claims falling outside the scope of the rental car agreement, especially those caused by excepted conduct such as intoxication or willful or wanton negligence. Upon completing the claims investigation, the ACO or CPO should determine whether the rental company's refusal to consider the matter due to excepted conduct is correct. If not, notify the AAO and discuss the matter with the Contracting Office, Surface Deployment and Distribution Command (SDDC). Otherwise, process any third-party damage claims under the appropriate tort claims statute and process claims for damage to the rental car under the JFTR. Where the driver was acting outside the scope of employment, individual liability may attach to the driver's actions; such liability may be covered under the government driver's POV liability insurance policy. If so, inform the third party or rental car company claimant.

(3) If the driver rented the vehicle from a non-signatory rental car company, ask what third-party liability coverage is provided to the ordinary renter. If coverage is part of the rental contract, follow the procedures set forth above.

(4) If the value of damages exceeds the policy limits, the incident should be investigated to determine liability. If a claim is filed against the U.S. and it is obvious that policy limits will be exceeded, the ACO or CPO in conjunction with the AAO should determine whether the rental company or the U.S. will act as lead defendant.

f. Sought from the United States by other tortfeasors. Claims for indemnity or contribution from the United States will be compromised or settled if liability exists under applicable law, provided that the incident giving rise to such claim is otherwise cognizable under one of the tort claims statutes. Such claims are valid under the FTCA if permitted by state law under the private person analogy, 28 U.S.C. § 2674, United States v. Yellow Cab Co., 340 U.S. 543 (1951); Rayonier Inc. v. United States, 352 U.S. 315 (1957).

(1) An exception may exist when a Soldier sues a federal contractor and the contractor files a claim for indemnity. The Feres defense may bar both the Soldier's suit against the contractor and the latter's claim for indemnity, particularly where the "government contractor" defense is viable under state law (as when the contractor followed federal specifications or the government had final approval of the item manufactured), FTCH § I, E10c. Stencel Aero Engineering Corp. v. United States, 431 U.S. 666 (1977). When the "government contractor" defense is not available, the Feres defense may still shield the United States, but it would not protect the contractor.

(2) Immunity extends to individual suits against all federal employees acting within the scope of employment, including federal vehicle drivers and health care personnel, 10 U.S.C. § 1089, 28 U.S.C. § 2679. If an employee is sued individually, the suit may be removed to federal court upon the defendant's request, 28 U.S.C. §§ 1441-1451, 28 C.F.R. Part 15. Simple removal does not vest jurisdiction in a federal court; the DOJ must certify the employee as acting within the scope of employment.

(3) Regardless of an employee's or Soldier's personal immunity, there may be times when an individual will not be protected by the FTCA, as when a claimant alleges deprivation of Constitutional rights or the employee is a borrowed servant of a civilian entity. Even though it may appear that the actor was outside the scope of employment, it may still be in the United States' best interest to certify and represent the employee or Soldier, 28 U.S.C. § 517. However, DOJ scope certifications are not conclusive and are reviewable for substitution, or scope, purposes, Gutierrez de Martinez v. Lamagno, 515 U.S. 417 (1995). Therefore, a federal court may hold that an employee was not acting in the scope of federal employment or find that the actor was employed by an entity other than the United States (for example, a medical resident in training at a civilian hospital). In those situations, the employee may eventually request indemnification. It may be in the best interests of a federal program or policy to indemnify such individuals. Specific federal legislation permits indemnification of military health care personnel (10 U.S.C. § 1089(f)) and military legal personnel held liable (10 U.S.C. § 1054(f)). Consider all requests for indemnification by following the guidance provided in these statutes and in AR 27-20, chapter 3 .

2-63. Structured settlements

For more information on settlement agreements see paragraph 2-73 . Sample settlement agreements for various situations are posted on the USARCS Web site at "Claims Resources," II, b.

a. FTCA. The FTCA and other federal tort statutes contain no provisions authorizing structured settlements. State statutes mandating structured settlements do not apply to the United States. Nevertheless, the United States is permitted to use structured settlements that, when appropriate, may include a grantor trust owned by the United States to provide future medical and attendant care to the injured party, FTCH § II, F7, Reilly v. United States, 863 F.2 d 149 (1st Cir. 1988); Hull v. United States, 971 F.2 d 1499 (10th Cir. 1992), cert. denied, 507 U.S. 1030 (1993). Accordingly, the United States may voluntarily negotiate and enter into structured settlements. Approval and settlement authorities are strongly encouraged to use structured settlements in all appropriate claims.

b. Other statutes. Under other statutes implemented by AR 27-20 , the Commander USARCS, may require or recommend to a higher authority that an award incorporate an acceptable structured settlement as a condition precedent for paying such award, notwithstanding objection by the claimant or representative, when:

(1) It is necessary to ensure adequate and secure care and compensation to a minor or other incompetent claimant 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 by the injury giving rise to the claim.

c. When used. Structured settlements are used primarily in claims involving catastrophic injuries, severe diminution or elimination of the claimant's ability to earn a living, wrongful death of a spouse or parent, or injuries to a minor child. They are helpful in claims with large verdict potential, where the United States can mitigate its settlement costs by satisfying the claimant' s long-term needs. Any properly structured settlement should be designed to meet those needs. The claim amount does not need to be high to merit a structured settlement, however. These arrangements are effective in amounts within the settlement authority of area claims authorities, particularly in ensuring a minor is compensated for his injuries by providing an annuity payable at the age of majority. If the offer is rejected, insist that the award be placed in a secure bank account until the age of majority. A structured settlement may compensate for pain and suffering and for medical, custodial and rehabilitative costs, and it may provide financial support for dependent family members. Offering the distinct advantage of avoiding premature dissipation of funds through mismanagement, a structured settlement insures that an injured party, not the party's parents, guardians or caretakers, receives the award's full benefit. Periodic payments received under a structured settlement are currently excluded from federal taxation (Internal Revenue Code § 104(a)(2)). In accordance with current DOJ policy, however, do not disclose or discuss this fact during negotiations.

d. Substantiation. During the claim investigation, especially the claimant interview, make every effort to identify and substantiate the claimant's needs. They will likely involve readily identifiable damages such as medical bills, future medical and rehabilitation expenses and lost income. The claimant's needs do not always mirror the traditional damage elements, however. Taken together, they often represent what it would take to make the claimant "whole" or as close to it as possible. Identifiable needs include a child's higher education, purchase of a business or home or, if the injured party's life expectancy is severely shortened, the adult survivors' long-term plans. Therefore, gather information about these contingencies as well as the parties' health, age, educational status, job history and stability, and personal income. Check the availability of private and government medical care plans.

e. Coordination. Coordinate the use of a structured settlement with the AAO, who will provide guidance about whether its use is appropriate in a specific case, offer brokers' names and the documentation necessary to obtain premium quotations, and help design the structure. When negotiating a structured settlement, draft the settlement and trust agreements in conjunction with the USARCS representative. This coordination ensures consistent language throughout the settlement documents. Such consistency is important because the DOJ, which is responsible for monitoring all FTCA structured settlements after payment, and USARCS, which is responsible under other federal statutes, will likely review the documents.

Section VIII
Negotiations

2-64. Purpose and extent

See FTCH § II, G for discussion of methods of negotiation.

a. Undertaking negotiations.

(1) The purpose of negotiating is to reach a prompt agreement to settle a claim at an amount that is fair to both the claimant and the United States. If the parties cannot agree on an amount, they should clearly define the liability and damages issues in the event suit is filed under the FTCA or AMCSA or an administrative appeal is brought. Because claims statutes represent a partial waiver of sovereign immunity, the legislative intent behind them clearly authorizes the government to pay meritorious claims in a fair amount.

(2) From the outset of a claim, claims personnel should fully inform the claimant or the claimant's representative about the applicable procedures and, when indicated, the nature and extent of the government's investigation. A meaningful negotiation is usually enhanced by the mutual exchange of information derived from both sides' investigations. Where a claim is barred or excluded from jurisdiction, as by the incident-to-service doctrine or the statute of limitations, claims personnel should inform the claimant that an investigation of the merits either is not necessary or, if undertaken, may be limited in extent.

(3) Where negotiations result in an irreconcilable difference in the value of the claim or interpretation of law, consider mediation prior to making a final offer.

b. Admissions of liability. Government representatives should not make admissions of liability, either written or oral, during negotiations. This is standard procedure whether or not a judicial remedy exists. Such statements constitute admissions against interest which are admissible in evidence.

(1) It is not necessary to admit liability to settle a claim. Admitting liability may even make settlement more difficult to achieve. Many claims settlements represent a compromise, reflecting all the strengths and weaknesses of the claimant's claim on liability and damages. Admitting liability removes any incentive to compromise that a strong government case might present. It creates the impression that the claim should be settled for full value, regardless of factual or legal strengths or weaknesses. For example, if the government is able to raise a meritorious contributory negligence defense, it may justifiably reduce the settlement offer. Admitting liability eliminates any chance to do this.

(2) During negotiation of FTCA claims, withholding an admission of liability forces the claimant's attorney to assess the risks of litigation. This represents a real incentive to settle, considering the time and expense involved in litigation as well as its uncertain results. Withholding an admission of liability also serves to encourage the claimant's attorney to cooperate in investigating the claim.

(3) There are several ways to settle claims without admitting liability. The simplest and most effective way is to shift the focus of discussion from liability to damages. For example, telling a claimant's attorney that the parties need to discuss damages rather than liability usually suffices to turn most attorneys' attention to settlement.

(4) When the government's own investigation establishes liability, it is counterproductive to require the claimant's attorney to prove liability, through either written opinions from hired experts or letters or memoranda citing legal authorities. Insisting on a full-scale showing not only increases the claimant's legal costs, but also indicates to the claimant's attorney how strong the claim is and, hence, its higher value.

(5) The amount of the compromise settlement should represent a reduction in the claim's full value in accordance with the strength of the arguments mitigating full values, whether based on comparative negligence or uncertainty as to the injuries.

c. Claimant interview. When the initial claimant interview has been limited to liability issues request an additional interview to gather information about damages. See paragraph 2-23b(10) for information on how to interview on damages.

d. Knowledge of facts. Settlement is not possible without a full understanding of the facts. To this end, obtain as much firsthand knowledge as possible. When a factual disagreement develops, try to resolve it. If the disagreement arises because the claimant's attorney does not understand the case, try to disclose the facts that your investigation has developed through IMEs, interviews, or site visits. For example, if the parties disagree about whether an intersection is blind, offer to visit the scene and show the attorney the intersection. Never allow the disagreement to escalate into a dispute. Simply state, for example, what you saw when you visited the scene. The claimant's attorney should realize that your position is stronger because it is based on direct investigation.

2-65. Who should negotiate

a. Obtaining advance authority. Determining who is the appropriate officer to negotiate a settlement is directly related to the amount of the claim, the authorized settlement and approval limits of various claims officials and the statute that the claim falls under. Settlement and approval limits are set forth at paragraph 2-69 . An AAO or, upon delegation, a representative of an ACO or CPO may settle a claim in any amount subject to approval by higher authority, in accordance with the settlement limits that are authorized. An AAO need not obtain advance authority from the DOJ or DA when the settlement amount will not exceed USARCS' authority: $200,000 for FTCA claims and $25,000 for MCA claims. A USARCS representative will conduct advance discussion with the DOJ when implementing regulations require it. See 28 C.F.R. § 14.6(b) . If the settlement amount is subject to approval by a higher authority, let the claimant know this at the outset. If the claimant states a preference for direct negotiation with the DOJ or the Army General Counsel, tell the claimant that the FTCA does not confer upon the DOJ authority to settle any agency claim during its administrative stage. Under other statutes, only the Commander USARCS represents the Army.

b. Authorized settlement limits. An ACO, a CPO, or Claims Service may settle any claim in a stated amount within his or her authority as set forth in paragraph 2-69. Where a claim's stated amount exceeds the settlement authority, the ACO or CPO and the AAO will determine who should settle. Because they can and do settle many claims for higher amounts, it is not proper for the ACO or CPO to inform a claimant that only USARCS exercises jurisdiction on claims seeking amounts over the ACO's or CPO's delegated authority. Moreover, USARCS has made it a case-by-case practice to delegate greater authority to ACOs or CPOs with the requisite ability and experience.

c. Responsibility of negotiator.

(1) The ACO or CPO should try to negotiate a tentative settlement. Non-attorney claims personnel may conduct negotiations only with a claimant or a non-attorney. Only an attorney should negotiate with a claimant's attorney. All persons who negotiate for the government should always disclose that they are seeking a tentative settlement.

(2) After reaching the tentative settlement, the attorney who settled the claim will prepare a settlement memorandum with the AAO's help.

(3) Forward the settlement memorandum to the appropriate settlement or approval authority for approval of the tentative settlement. Once the settlement is approved, forward it for payment as outlined in Section X , Payment Procedures.

d. Disclosure of settlement authority. For claims in which the settlement amount exceeds the negotiator's settlement authority, disclose appropriately, following these guidelines:

(1) Always explain the settlement procedure to a claimant's attorney before negotiations begin, summarizing the limits of settlement authority existing within both the Army and the DOJ. Otherwise, the claimant's attorney will assume that authority exists for any offer the negotiator makes. Explain that the DOJ must approve any FTCA settlement over $200,000, and that a delegee of TJAG or the Secretary of the Army, as appropriate, must approve settlements over $25,000 for the MCA, and $100,000 for the AMCSA or FCA.

(2) A settlement made by one who lacks authority is void. It is a source of potential embarrassment both to the Army and to the individual who negotiates it. Any such settlement is certain to create difficulties in managing the case.

(3) Avoid disclosing specific instructions included in a grant of negotiating authority for a specific claim, except in the most unusual case after consulting the AAO.

2-66. What should be compromised

a. Special damages.

(1) Practically any claim, regardless of amount, may be compromised through direct negotiation. Scrutinize small property damage claims for governmental liability and damages and compromise accordingly. Damage estimates should be reviewed by either well-trained claims personnel or an expert to determine if the repair costs and the parts to be repaired are justified. Similarly, have a government physician scrutinize medical bills and records to determine whether the care furnished was reasonable and necessary. The fact that an insurer paid a certain amount to its insured does not govern the extent of the Army's liability. The insurer, as subrogee, stands in the shoes of its insured as subrogor, and so is entitled to only that amount to which the subrogor is entitled.

(2) In cases of companion claims, where an insurer demands immediate payment on behalf of its insured, the negotiator should offer less than full value at first because the AAO must authorize all split payments. Once the offer is made, the ACO or CPO should consult the AAO. Review Section VI, Determination of Damages, and ensure that all special damages are justified before approval. The claimant should support past lost wages with income tax forms and future medical costs with a competent medical opinion. Where the proof is questionable, negotiate a lesser amount.

b. General damages. These are not only difficult to estimate but they are also the award component most subject to fluctuation in amount. The difficulty may be alleviated by studying past medical records and conducting interviews with the claimant, family and friends or acquaintances. Obviously, special damages are easier to quantify and negotiate than are general damages. While the claimant may agree to accept reductions in special damages, the claimant may cancel out any reduction by demanding higher general damages. The key to negotiating general damages is learning what amount the claimant will accept as settlement. In view of the tort reform legislation pending in Congress at the time of this writing, which seeks to limit general damages on FTCA awards, the DOJ's current position severely limits the acceptable general damages amount in an administrative settlement. This policy has succeeded mostly because in those jurisdictions well known for "runaway" general damage awards granted either by judge or jury, FTCA administrative settlements still occur frequently. Perhaps this approach is succeeding also because of the length of time required to obtain a final judgment. In an all too typical situation, after various appeals, a brain-damaged baby whose claim is filed by age two does not receive compensation for personal injuries until reaching age eight. By regulation, a $500,000 damages cap has been set for MCA and NGCA claims. See AR 27-20, paragraph 3-5a(3)(h) and paragraph 2-53 of this publication. Damages under the FCA will be limited by host country law. General damages under the FTCA should be scaled accordingly.

c. Compromising statute of limitations cases. Whether or not a claim has been timely filed is a question of fact that should be answered only after a thorough investigation, including questioning the claimant, treating physicians and anyone else who cared for the claimant during the relevant time period. See paragraph 2-23b(11) . If a thorough investigation does not reveal a definitive answer, then consider compromise and consult the USARCS AAO, who will coordinate with the DOJ as needed. The claim settlement value should reflect the unresolved statute of limitation issue and the fact that the claimant might not recover damages if the case was successfully defended at trial on the basis that it was not timely filed. Claims personnel frequently compromise large claims involving serious injuries, such as brain damage and quadriplegia, with structured settlements that address the claimant's lifelong medical and personal care expenses through the use of a reversionary medical trust, which provides an immediate payment award sufficient to cover past expenses and attorneys' fees, taking the statute of limitation issue into account.

2-67. How to negotiate

a. Extent of preliminary instructions. Successful negotiation is a matter of style and temperament. Good practice dictates against instructing the chosen negotiator in too much detail how to reach agreement at the authorized settlement amount. Nevertheless, the DOJ's informal policy is to start low to approach a fair settlement. In fact, the DOJ requires that all settlement memoranda sent to it for approval include a negotiation history. Keep the DOJ's policy in mind. It is usually not too difficult to "start low" since most claimants file for amounts much higher than what they deserve or reasonably expect. Once claimants file suit, it is difficult to obtain an increase in the amount claimed, 28 U.S.C. § 2675(b), FTCH § I, B6e.

b. Caution in formulating offer. The ability to conclude a successful negotiation depends in large part upon determining what the claimant will accept. For example, when a claim seeks $1,000,000 and the government evaluates the claim at $200,000, the government should not open with an offer of $175,000 unless the negotiator knows that the claimant is willing to enter into meaningful negotiations from that starting point. The government, by offering $175,000, then enters any pretrial settlement conference with the potential to split the difference between $175,000 and $1,000,000.

c. Preliminary knowledge. Knowing the other attorney's reputation and background, including his or her ability to try cases, assists in determining the negotiation methods. When attorneys are expected to split their fees, the likelihood of executing an administrative settlement is enhanced since the referring attorney's fee will be reduced if there is a trial. Refuse to negotiate with a paralegal or junior attorney; deal only with the attorney empowered to make the decision. When negotiating a disputed claim with an insurance company, deal only with its senior adjudicator or attorney. Prior to any negotiations, make sure that the attorney has obtained authority to settle from the client and secure a promise that the attorney will pass your offer to the client in accordance with the legal profession's ethical requirements. Remember that you are dealing with the claimant through an attorney and your aim is to meet the claimant's desires, not the attorney's. Always refer a claimant's direct inquiry (for example, a claimant's complaint to a member of Congress) to the attorney. In a delegated claim within USARCS' authorized jurisdiction, negotiate in person, at least initially. Subsequently, it is permissible to use the phone or e-mail. A personal relationship with the claimant's attorney is always best.

d. Initial offer. It is hoped that following these guidelines will assist in formulating and determining the government's initial offer. If the negotiator is uncertain, ask the claimant's attorney for a demand. If the response is meaningless, do not make an initial offer of $175,000 (when the authorization is $200,000 and demand is $1,000,000.) A better initial offer would be $100,000. If the attorney will not name a figure, ask the attorney to identify the key elements of damages and deal on a point-by-point basis. Successful negotiation is conducted through dialogue. Try to start a dialogue by identifying the disputed points. Do not mention a figure unless you intend it as an offer. To continue with the above example, do not state that the offer is $100,000 but you will go to $150,000 if the attorney will come down. By doing so, you have offered $150,000 without forcing your opponent to drop below the $1,000,000 claimed. Never bid against yourself! Never raise your offer in the absence of a reasonable counteroffer.

e. Final offer. If an impasse is reached, do not immediately make a final offer. Wait until the attorney has had time to reflect. Make certain the attorney knows that once suit is filed, the case is no longer under the Army's jurisdiction. If the attorney demands a written confirmation of your verbal offer, do not provide such an offer. A written offer's only legitimate purpose during negotiations is to provide the opposing attorney the means to convince the client that the latter's expectations are unreasonable. In this situation, write a letter for the claimant's consumption. Include your arguments, not merely a figure. In a FTCA case, a final offer may be in order when there is no reasonable expectation of continued negotiations. When the six-month administrative period for filing suit has expired and meaningful negotiations have never commenced, inform the claimant's attorney that suit may be filed at any time as there is no reasonable expectation of a settlement. When administrative appeal, not suit, is the next step, a notice containing a final offer, detailing the reasons therefore, is in order so that an informed appeal may be made.

2-68. Settlement negotiations with unrepresented claimants

a. An ACO or CPO deals with unrepresented claimants in four situations:.

(1) When investigating the incident before the claim is filed.

(2) When the claimant seeks information about filing a claim against the United States.

(3) When the claims attorney or investigator seeks to interview or obtain information from the claimant after the claim has been filed.

(4) When attempting to settle the claim.

b. Establishing trust. When dealing with unrepresented claimants in these situations, follow the principles outlined below. Certain disclosures are intended to foster an atmosphere of trust and confidence. They may be made orally or in writing. If making oral disclosures in an interview with an unrepresented claimant, prepare a memorandum for record and place it in the claim file. These disclosures should be made in writing, however, if it appears that these matters may form the basis of a dispute.

(1) Fully explain the administrative claims process to an unrepresented claimant.

(2) CJAs and claims attorneys must disclose their status as attorneys. Claims personnel who are not attorneys will not represent themselves as such or create the impression that they are attorneys.

(3) Claims personnel should not indicate, or create the impression, that they are disinterested in the outcome of the claim. Accordingly, claims personnel should tell the claimant that they represent the United States and not the claimant. This is especially important with unrepresented claimants, who are often confused about the status of claims personnel.

c. Explaining the administrative process. Claims personnel are specifically authorized to communicate with claimants about the filing and processing of claims. When a claimant is represented by an attorney, however, any direct communication with the claimant is unauthorized.

(1) AR 27-20 authorizes claims personnel to explain how to file a claim and to disseminate information about the administrative claims procedures, including how a claim will be investigated, what law will be applied, and how a settlement will be determined. This limited authority does not mean, however, that claims personnel may advise the claimant whether or not to file a claim. The claimant should always be told to file even when personnel believe that the claim is barred by the incident to service doctrine or the statute of limitations.

(2) Avoiding an advisory role means that claims personnel may not tell a claimant what amount to claim. The ACO or CPO may, however, discuss with the claimant the elements of damages deemed payable. Avoiding an advisory role, usually has three practical effects:

(a) It almost always forces a claimant to think about hiring an attorney.

(b) It prevents claims personnel from having to explain valuation of the claim.

(c) It prevents allegations that the representative of the ACO or CPO promised to pay the claimant the amount demanded on the claim form.

d. Answering questions about hiring an attorney. Claimants often ask whether they should hire an attorney to file and settle a claim. Take the following approach in response:

(1) Advise the claimant that the administrative procedure does not require the claimant to hire an attorney. It is up to the claimant whether to hire legal counsel or not.

(2) If the claimant objects to the amount of the attorney's fee, suggest that the claimant consider hiring an attorney on an hourly basis solely to evaluate damages.

(3) If it is obvious that a claimant will need representation, as, for example, in a complex claim requiring difficult decisions or a level of knowledge beyond the claimant's capability, it is best to suggest that the claimant hire an attorney. This straightforward approach avoids later charges that the office took unfair advantage of an unrepresented claimant.

(4) When the claim involves a minor or an incompetent and its settlement requires judicial approval, attorney representation is usually required. Inform the claimant that judicial approval of settlement will be required.

(5) When a claimant requests the name of an attorney, do not refer the claimant to a specific attorney or suggest any individual attorney's name. Legal assistance officers are prohibited from assisting clients with potential claims against the United States. Claims personnel may, however, refer persons eligible for legal assistance to the legal assistance office for advice about hiring a lawyer and for a standard referral list. Many legal assistance offices hand out such lists. If the claimant is not eligible for legal assistance, direct the claimant to a lawyer referral service.

(6) It is permissible for an ACO or CPO to give the claimant the following information:

(a) The FTCA expressly limits attorney fees to 20 percent of any administrative settlement. After suit is filed on a FTCA case, fees are limited to 25 percent of the settlement or judgment amount. AR 27-20 limits attorney fees to 20 percent under all other chapters. The claimant pays these fees from the settlement and is also responsible for court costs.

(b) The attorney may not charge a fee that exceeds the percentages mentioned in (a) , above, but only the claimant and the attorney negotiate the attorney fee between them.

(c) If the legal assistance office has compiled an informational handout for claimants to use in selecting an attorney, it may give one to the claimant (whether or not entitled to legal assistance). Do not distribute any referral list or other document that contains the names of individual lawyers or law firms.

e. Negotiating. Much of the information on negotiating settlements set forth in paragraph 2-64 applies also to unrepresented claimants. If a meaningful negotiation has occurred, offer the full amount that the settlement authority has authorized. Do not offer this amount, however, unless you have established both rapport and trust with the claimant. The government should not be placed in a position where its offer represents full value, only to have the claimant hire an attorney who in turn demands an increase. If the claimant refuses to enter into meaningful negotiations, insist that the claimant hire an attorney. If the claimant refuses to enter into meaningful negotiations or to hire an attorney in an FTCA case in which the six-month period has expired, inform the claimant that suit may be brought as settlement is not possible. In both FCA and MCA claims, where suit is not possible, make a final offer.

f. Preparing memoranda for record. Claims personnel should prepare MFRs of the discussions held with the claimant about claims procedures and about the claimant's need to hire an attorney, providing a copy to the claimant. They should prepare a separate memorandum of their personal observations of the claimant for the file.

Section IX
Settlement Procedures

2-69. Settlement or approval authority

a. General. "Settlement authority" is a statutory term meaning that officer authorized to approve, deny or compromise a claim, or make a final action; see 10 U.S.C. § 2731. "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. Any applicable limitations are discussed more fully in the appropriate chapter of AR 27-20 and this publication. Generally speaking, final action authority is maintained at higher level than settlement or approval authority. As emphasized in Sections I and III of this chapter, Claims Investigative Responsibility and Processing of Claims, respectively, an ACO or a CPO must investigate all claims incidents fully and account for all claimants, actual and potential, as well as estimate an incident's total settlement value. Otherwise, it is not possible to identify the proper settlement authority. In any incident in which the amounts claimed or to be claimed exceed the ACO's or CPO's monetary jurisdiction, it is essential to notify the appropriate AAO and to establish a mirror file. Through such coordination and discussion with the AAO, the representatives of the ACO or CPO may estimate settlement value. If the representatives of the ACO or CPO wish to begin settling, in properly delegated amounts, USARCS may grant permission to do so. For individual claims, a higher authority, located either within or without USARCS, may approve an increase in an ACO or a CPO representative's settlement authority beyond that granted by AR 27-20, based on the officer's experience, willingness, and ability. Any increase in the monetary settlement authority is subject to the same limitations and procedures that apply to a USARCS AAO.

b. Military Claims Act or National Guard Claims Act. See AR 27-20, paragraph 3-6 .

(1) Approval authority. The settlement authority is that person who exercises monetary jurisdiction over the claim that is the greatest in amount. When all actual or potential claims for $25,000 or less arising out of one incident may be settled by approval either in full or in part, that ACO or CPO has approval authority over all the claims. If only one actual or potential claim for an amount greater than $25,000 is anticipated, it must be coordinated with the appropriate AAO, based on the mirror file sent to USARCS. If each claim cannot be settled for $25,000 or less, forward them to USARCS for final action. The Commander USARCS, may make a final offer for $100,000 or less, subject to approval by TJAG, or for more than $100,000, subject to the Army General Counsel's approval. Claimants who refuse USARCS' final offer have the right to appeal.

(2) Final action authority. When all actual or potential claims arising out of one incident are, or will be, filed for $25,000 or less, the head of an ACO (not of a CPO) has the authority to deny (or make a final offer) on any claim in a stated amount of $25,000 or less, subject to appeal to the next higher authority. This authority may not be delegated. Within the United States, that authority is USARCS. Outside the United States, that authority is held by a command claims service, if any. If there is no command claims service, it is USARCS. Otherwise, the Commander USARCS, is the final action authority subject to appeal to higher authority.

(3) Multiple claims arising out of one incident. Where multiple claims arise out of one incident, USARCS may settle in any amount subject to approval by higher authority, even though its authorized monetary limit is $25,000, the same as that of an ACO or a CPO. Close coordination with the appropriate AAO may result in a delegation of approval authority similar to that made in certain FTCA claims.

c. The Federal Tort Claims Act. See AR 27-20, paragraph 4-6 .

(1) Approval authority. The settlement authority is that person who exercises monetary jurisdiction over the estimated settlement value of all actual or potential claims arising out of one incident. When each actual or potential claim arising out of one incident may be settled either in full or in part for no more than $50,000, and the value of all settled claims arising out of the incident does not exceed $100,000, the settlement authority in the ACO or CPO has approval authority over all the claims. If the claims cannot be settled for those amounts, forward them to USARCS for final action.

(2) Final action authority. The head of an ACO, but not of a CPO, has authority to deny or make a final offer on one or more claims in the stated amount of $50,000 or less, if the total amount of all actual or potential claims does not exceed, or is not anticipated to exceed, $100,000. This authority may not be delegated. All denials are subject to reconsideration by USARCS, which also exercises denial or final offer authority on claims for more than $50,000. A sample memorandum seeking approval of a settlement on a claim in the amount of $150,000 (format used for up to $200,000) is posted on the USARCS site at "Claims Resources," II, a, no. 26.

(3) Total value exceeds $200,000. If the total value of an FTCA incident exceeds $200,000, the ACO or CPO may obtain permission to settle from the Department of Justice Civil Litigation Division (DOJ Lit Div) through USARCS by submitting a claims memorandum of opinion. A sample memorandum seeking approval by the Department of Justice for $200,000 (or more) is posted on the USARCS Web site at "Claims Resources," II, a, no. 26. It must contain the names of all claimants, actual and potential, as well as each claim's estimated settlement value and the entire incident's settlement value.

d. Nonscope Claims Act. (See AR 27-20, paragraph 5-5 ). There is no limit to the number of claims arising out of a single incident that may be paid. While a subrogee may not be paid, it must agree that the settlement is final and not subject to filing of suit under the FTCA or appeal under the MCA; that is, a subrogee must agree that the Army pays only the insurance deductible.

e. Army Maritime Claims Settlement Act. See AR 27-20, paragraph 8-8 .

(1) Approval authority pertaining to both claims against and in favor of the United States. An ACO may approve a claim in an amount of $50,000 or less. Chief Counsel, Division Counsel and District Counsel, COE, may approve each claim in an amount of $100,000 or less. The Commander USARCS has identical authority. The Army General Counsel may approve a claim in any amount, provided that claims approved in excess of $500,000 are sent to Congress for a deficiency appropriation.

(2) Final action authority. If a claim is denied as non-meritorious or if the claimant refuses to accept a final offer, inform the claimant of the two-year filing requirement for both the Suits in Admiralty Act (SIA) and the Public Vessels Act (PVA). An ACO has authority to deny or make a final offer on claims in a stated amount up to $50,000; COE authorities may deny or make a final offer on claims up to $100,000. If denial is recommended or a final offer is indicated, forward claims seeking more than those amounts to the Commander USARCS, who has final action authority.

f. Foreign Claims Act. See AR 27-20, paragraph 10-9 .

(1) Approval authority. A one-member Foreign Claims Commission (FCC), if a JA or claims attorney, may settle all claims arising out of one incident for not more than $15,000 each, regardless of the amounts claimed. If the one-member FCC is neither a JA nor a claims attorney, the settlement limit is $5,000. A three-member FCC may approve all claims arising out of a single incident in amounts up to $50,000 each, regardless of the amounts claimed, if the total amount of all claims settled does not exceed $100,000. If it does, approval of the Commander USARCS is required. If the amount of any individual settlement exceeds $100,000, it is subject to approval by the Army General Counsel.

(2) Disapproval authority. A one-member FCC, if a JA or a claims attorney, may disapprove all claims arising out of a single incident, if the stated amount of any one claim does not exceed $15,000. A one-member FCC who is not a JA or claims attorney has no disapproval authority. When disapproval is recommended, the claim will be forwarded to the appointing authority. A three-member FCC may disapprove a claim in any amount.

g. Affirmative claims. See. AR 27-20, paragraph 14-11 .

(1) Approval authority. An ACO or CPO may compromise collection action on a claim asserted for $50,000 or less unless recovery action is reserved by a command claims service, in which event the command claims service will have such authority.

(2) Final action authority. An ACO or CPO may terminate collection on a claim asserted for $50,000 or less unless action is reserved by a command claims service, in which event the command claims service shall have such authority.

2-70. Splitting property damage and personal injury claims

a. As a general rule, a claimant may be paid only once, except for advance payments under the MCA or FCA. For example, if a property damage claim is paid either in full or in part pursuant to a settlement, the claimant may not be paid later for hidden damages discovered after settlement or for loss of use. The claimant is bound by the statutory text of 28 U.S.C. § 2672, the language appearing on both the signed FMS Form 197 (Judgment Fund Voucher for Payment) and on DA Form 7500 (Payment Report). See the headings for sections III and IV of appendix A for Web sites where blank copies of the forms may be downloaded. In addition, sample completed forms are posted for viewing on the USARCS Web site at "Claims Resources," II, b, nos. 15 and 17. An exception to this rule is that a claim may be paid for property damage at one time and paid for personal injury subsequently. If the claimant files both claims at the same time, only one claim number will be assigned. If the claimant files them at different times, two claim numbers will be assigned. The later personal injury claim, however, must be filed within the two-year statute of limitations. When a claimant is unable to pay the repair bill, issue a written statement to the repair facility that the cost of repairs will be paid to the claimant upon receipt of an exact amount. This may enable the claimant to obtain possession and avoid further loss of use charges. Do not use this method unless it is certain that the claimant will pay the repair facility.

b. Follow these criteria:

(1) Mark either the DA 7500 or the FMS Form 197 with the language: "For Property Damage Only."

(2) On a claim in which the government is clearly liable, the amount stated on the low estimate may be paid if it is determined to be correct. When liability or damages are in doubt, pay only that amount which reflects the government's liability or the degree of comparative negligence.

(3) When the predicted value of all claims, actual and potential, arising from one incident exceeds $100,000, based on the ACO or CPO estimate, no claim may be paid absent discussion with and assent by the AAO. If the total value of a FTCA claim exceeds $200,000, USARCS must obtain the DOJ's written approval to proceed with a settlement.

(4) When the claimant is an active duty Soldier whose personal injury claim is barred by the incident to service doctrine, the claimant must agree that any settlement is final and conclusive for both property damage and personal injury. Do not mark the file, "For Property Damage Only."

(5) Strictly define property damage and ensure that it does not include medical bills and lost wages, whether or not subrogated.

c. It is anticipated that claims personnel will apply the following procedure mostly in minor vehicle accidents. Furthermore, it is improper practice with some ACOs or CPOs to require a claimant or passengers in the claimant's vehicle (potential claimants) to waive any personal injury claim before receiving payment for property damage. Claims personnel should not solicit unnecessary waivers. The following are examples of property damage claims that should be paid promptly:

(1) A GOV rear-ends a privately-owned vehicle (POV) because the GOV operator was not paying attention (was negligent). Minor property damage results to the POV. Both drivers drive away and do not report any injuries at the scene. The ACO may proceed to pay without contacting the AAO.

(2) A GOV loses its brake power and hits the rear of a POV that is slowing down for heavy traffic on a highway. This action in turn causes a five-POV chain collision, involving ten persons in all. One person is taken to the hospital. All POVs remain drivable. The ACO should contact all ten persons for statements on the extent of their injuries to determine whether the incident's total predicted value will exceed $200,000. The ACO or CPO may use other means to make this determination, such as interviewing witnesses or police officers. The ACO or CPO must forward a mirror file to USARCS and then telephone the USARCS AAO about the matter.

(3) A GOV driver runs through a red light on a military installation and collides with a Soldier's POV. The Soldier files a claim for property damage and for his personal injuries and loss of consortium of the spouse passenger. Both injuries are minor and valued within the ACO's monetary authority. The Soldier should be paid under the MCA for property damage but under the FTCA for loss of consortium only, provided that he agrees to relinquish his own personal injury claim. Any claim that the Soldier brings under the FTCA for either personal injury or property damage is barred by the Feres doctrine; however, the MCA's statutory incident to service exclusion bars only a claim for personal injury, not for property damage. The spouse's personal injury claim should be paid under the FTCA, or outside the United States under the MCA, as there is no bar on the face of the claim. If the incident's total predicted value exceeds $100,000, the ACO should discuss it with the USARCS AAO.

(4) A GOV and a POV collide and all persons involved are injured. The incident's total predicted value will exceed the ACO's monetary authority. The first claim is filed by the POV insurer, seeking compensation for property damage to the POV as well as lost earnings and medical bills of the injured driver and her passengers. Discussion between the ACO and AAO indicates that government liability is greater than fifty percent and that the incident's total value is less than $200,000. The insurer, properly subrogated under state law for all three elements claimed, demands immediate payment. The ACO or CPO may pay the claim only for repair to the POV in an amount reflecting the government's proportional liability. This policy's major purpose is to permit claimants to receive expeditious payment for POV damage before looking to their own collision coverage; however, these payments must compensate claimants for property damage, including hidden damages and loss of use.

2-71. Advance payments

In the case of a person who is injured or killed, or whose property is damaged or lost, under circumstances for which the Secretary of a military department is authorized by law to allow a claim, the Secretary may make a payment to or for the person, or the legal representatives of the person, in advance of the submission of such a claim or, if such a claim is submitted, in advance of the final settlement of the claim. The amount of such a payment may not exceed $100,000. (10 U.S.C. § 2736) It may be made pursuant to the MCA, NGCA, or FCA. An ACO, CPO, or FCC may pay up to $10,000. It must request authority for amounts over $10,000 from USARCS. If USARCS already has a mirror file, submit a written request for increased authority, outlining the immediate need. Otherwise, enclose a mirror file with the request. USARCS may approve $25,000 or less and DJAG, $100,000 or less. Two sample advance payment acceptance agreements are posted on the USARCS Web site at "Claims Resources," II, b, nos. 4 and 5.

2-72. Action memorandums

An action is required on all settlements, whether approved, denied or the subject of a final offer, including those paid electronically. Two sample memorandums, prepared to seek approval for settlements on FTCA claims for $150,000 to $199,999, and those above $200,000, respectively, are posted on the USARCS Web site at "Claims Resources," II, b, nos. 25, and 26. A Small Claims Certificate ( DA Form 1668 ) constitutes an action memorandum when small claims procedures are used. A sample completed DA Form 1668 is posted on the USARCS Web site at "Claims Resources," II, a, no. 29. A blank copy is available at www.apd army.mil.

2-73. Settlement agreements

a. Requirement. A settlement agreement is required on all claims before payment may be made. Inform claimants seeking compensation for property damage that they may not later file personal injury claims and that signing the settlement agreement precludes further claims. This restriction does not apply to split payments. To obtain blank copies of the forms discussed in this paragraph see the headings for sections III and IV of appendix A for Web sites where copies may be downloaded. Sample completed forms may be viewed on the USARCS Web site at "Claims Resources," II, b.

b. Types of settlement agreements. There are three basic standardized forms that may serve as settlement agreements, dependent largely on the fund sources for the payment of the claim. Paragraph 2-80 breaks down fund sources for many different types of claims and states with greater specificity in which claims the following forms are used.

(1) Tort Claim Payment Report, (DA Form 7500). Use DA Form 7500 for settlement agreements for any claims that will be paid out of the Army claims expenditure allowance. Examples are FTCA settlements for $2,500 or under and MCA settlements of $100,000 or under per claimant.

(2) Department of the Treasury Financial Management Service (FMS) Form 197. FMS Form 197 (Judgment Fund Voucher for Payment) serves as settlement agreement for payments that are to be made out of the Judgment Fund. See paragraph 2-81e for information about how to access up-to-date Department of the Treasury FMS forms, including the FMS Form 197.

(3) DA Form 1666. DA Form 1666 serves as a settlement agreement for claims' payments on claims paid from COE, NAFI, or AAFES funds.

c. Exceptions. None of these above forms will suffice as a settlement agreement if the claim falls under any of the categories listed below. Examples for the first seven settlement agreements listed below are posted on the USARCS Web site at "Claims Resources," II, b, nos. 1-7. In all of these cases, field attorneys should call their AAO for assistance. These examples will be modified as necessary to reflect the circumstances of a particular claim.

(1) Where the claimant is represented by an attorney;

(2) Where the claimant is a minor or an incompetent;

(3) Where lienholders have a known interest;

(4) Where Medicare is a lienholder;

(5) Where a joint tortfeasor is participating in the settlement;

(6) Where there is a joint tortfeasor who is not participating in the settlement and a hold harmless agreement is required;

(7) Where the claim is for wrongful death;

(8) Where the claimant's assets have been taken over by a bankruptcy court. In that case call your AAO.

d. Claims falling under more than one chapter. When a claim has been considered under more than one chapter (statute), the settlement agreement must so state and expressly release the United States from liability under all statutes under which the claim was considered.

2-74. Final offers

a. The administrative claims process is designed to avoid litigation or appeals and their attendant costs. A compromise usually obtains better results than a lawsuit or a protracted appeal. Do not rely on an Assistant U.S. Attorney to do a better job than claims personnel can do. If a true compromise cannot be reached, however, claims personnel should try to have the claimant define and limit the issues to be decided at suit or in an administrative appeal.

b. Face-to-face discussion between parties is usually successful in either reaching an agreed settlement or identifying the issues at dispute. If there are clear issues of interpretation of applicable law, whether as to liability, who has the right to claim, or the elements of damages payable, mediation should be considered. Similarly, where the amount or value of damages is at issue, particularly where local precedent is involved, mediation can help. A mediator should be jointly selected and jointly compensated. Where issues of law are involved, try to obtain a current or retired federal judge. Where amounts only are involved, an experienced attorney may be best. Be aware of the two different styles of mediation; one is where the mediator actively takes a position and is willing to state his position; the other is where the mediator listens to each party separately and goes back and forth relaying what he has heard.

c. A final offer notice should be drafted to clearly justify the amount offered in sufficient detail and plain language so that the notice is self contained and easily understood by the claimant. The legal representative should be requested to pass on the entire notice to the claimant.

d. If the claimant refuses to be interviewed, submit to an IME or furnish essential documents such as medical records or wage and tax information, mail the claimant a request listing what actions are necessary and why. If this fails and the claimant still refuses to cooperate, make a final offer based on what the file already contains. The offer notice should refer to all earlier requests for information and explain why it is limited.

e. Sample formats for final offer notices are posted on the USARCS Web site at "Claims Resources," II, b, nos. 7 and 8. Note that an FTCA notice must inform the claimant of the right both to file suit and to request reconsideration. On the other hand, notices for MCA, NGCA, or maritime claims must contain an appeal paragraph.

2-75. Denial notice

a. Much of the guidance set forth at paragraph 2-74 , regarding exhausting all efforts to reach a settlement and fully investigating each claim, also applies to a denial. Before denying a claim solely because failure to prove liability or damages, inform the claimant in writing of these preliminary findings, providing additional opportunity to strengthen the showing. Three sample denial notices are posted on the USARCS Web site at "Claims Resources," II, b, nos. 9-11. These notices must describe the claimant's further remedies and they should state the factual grounds for denying the claim, particularly if the claimant has the right to appeal. These procedures will be used as well for abandoned and withdrawn claims.

b. A lawsuit for professional negligence may be filed only if supported by an expert opinion, except in the special circumstance where the doctrine of res ipsa loquitur applies. If the Army's expert review indicates there was no negligence, request the claimant in writing to furnish an expert opinion. Provide the claimant a brief summary of the Army's position, without identifying the Army's expert. For example, "Our review indicates as follows..." The claimant's refusal to furnish an expert opinion in an FTCA claim is grounds for denial, in accordance with Federal Rule of Civil Procedure 11, or by regulation in an MCA or FCA claim. AR 27-20, paragraph 2-38a(2) , states that failure to provide an expert opinion is a basis for denial. The same rationale applies to a claimant's refusal to submit to an interview or an IME. Include this information in the denial notice.

c. Where a medical malpractice claim by a Soldier is denied as it arose incident to service, and there has been no investigation on the merits, the following language should be used in lieu of a discussion of the merits, "Because of the above cited bar to suit, this Service has not conducted any claims investigation into the merits of the claim. Therefore, I have made no determination as to whether the claim is otherwise payable. However, the claim has been referred to Army medical authorities in order to ensure that a quality assurance review has been or will be conducted in accordance with existing directives and procedures."

d. A denial letter should never contain any statements to the effect that the Army was negligent but the claimant's negligence was greater. This constitutes an admission against interest which is admissible in court. It is better to state that the claimant caused the injury.

e. A notice of final denial action on a claim considered under more than one chapter (or statute) must reflect that the claim was considered under more than one statute and name each statute specifically. If appellate rights exist under any statute, the claimant must be so informed. Beware of special database entry requirements that apply when a claim has been considered as both a personnel and tort claim. See paragraph 13-1e for more information.

2-76. The Parker denial

a. If a claimant files suit under the FTCA before the agency takes final administrative action, DOJ policy requires the issuing of what is known as a Parker denial. See Parker v. United States, 935 F.2 d 176 (9th Cir. 1991). Its purpose is to prevent refiling of an administrative claim if the lawsuit is dismissed without prejudice. An ACO or USARCS issues such a denial notice only at the request of the trial attorney (usually an Assistant U.S. Attorney assigned to the case). The denial notice does not contain the usual language affording opportunity to request reconsideration.

b. If a lawsuit is filed on only one claim while its companion claims are pending in the administrative phase, issue a Parker denial on all the claims, thereby forcing them all into suit. However, if actual negotiations are ongoing in a companion claim, consult the trial attorney about whether to proceed to administrative settlement, for example, on a claim in which the Army's liability is obvious.

c. Where a claimant files suit prematurely, that is, before the requisite six-month period expires, discuss the matter with the claimant with a view toward persuading the claimant to withdraw the suit. If the claimant refuses to withdraw the suit, a Parker denial is not in order. Inform the trial attorney, furnishing copies of necessary documents so that the attorney can obtain a dismissal. Retain the original file for further processing.

d. Sometimes claimants file suit because they mistakenly interpret the FTCA to require doing so no later than two years from the date the claim accrues. If the claim is meritorious, request the claimant to withdraw suit either immediately or as a condition of any subsequent settlement. If the claimant refuses, issue a Parker denial.

e. When suit is filed, route all communications with the trial attorney through a representative of the Army Litigation Center.

2-77. Mailing procedure

a. Mail a final offer or denial notice by certified mail, return receipt requested. By a memorandum dated 1 June 1987, TJAG now permits use of special mail services (such as Federal Express).

b. Place the signed U.S. Postal Service mailing certificate in the claim file as proof of the date of mailing and of receipt. On an FTCA claim, the date the notice was mailed is the date that the six-month period for filing suit begins. On an MCA claim, the date of receipt is the date the appeal period begins. When mailing to a foreign mail service, claims personnel may attach a statement for the claimant to enter the date of receipt along with a return envelope. If the receipt is lost or not returned, retain a copy of the mail log.

c. Keep all correspondence returned as undeliverable and make every effort to determine the claimant's new address. If these efforts fail, attempt a second mailing to the address entered on the SF 95 . If this is returned, prepare a memorandum detailing the efforts to notify the claimant of the denial or final offer. In an MCA claim, the appeal period expires 60 days after the date the second letter is sent, unless there is evidence that the claimant received one of the letters. If the claimant receives the second letter, the appeal period is computed from the date of its receipt. In an FTCA claim, the six-month period begins on the date the second letter is mailed.

2-78. Appeal or reconsideration

a. Claims personnel should note whether the applicable statute allows for appeal or reconsideration. The right to appeal ensures that a claim is considered by the appellate or higher authority, while reconsideration, such as under the FCA, gives a claimant the right to have the original decisional authority reconsider its determinations.

b. Claims personnel should acknowledge an appeal or request for reconsideration upon receipt. Under the FTCA, a request for reconsideration re-invokes the six-month administrative period during which suit may not be filed, 28 C.F.R. § 14.9(b) . A sample acknowledgment letter to use when an appeal or reconsideration is requested is posted on the USARCS Web site at "Claims Resources," II, b, no. 5. It is very important that the acknowledgement letter notify the claimant that the six-month administrative period starts again.

c. The "appeal or reconsideration" paragraph in all final offers or denial letters directs the claimant to send the appeal or reconsideration through the settlement authority who took action. This ensures that all matters set forth in the appeal or request for reconsideration are fully investigated. If the investigation indicates that there should be a different outcome on the claim, such as approval or a higher offer, the settlement authority may take such action subject to any statutory or regulatory limitations. If a different action is not warranted, the settlement authority will prepare a supplemental action stating the reason and forward the claim with the appropriate recommendation to the higher settlement authority.

d. The non-FTCA claims statutes provide only an administrative remedy. The original settlement authority may, even in the absence of an appeal or request for reconsideration, correct and modify the original action even if a claim has been approved for payment. A successor settlement authority is limited to taking corrective action on the basis of fraud, substantial new evidence, errors in calculation or mistake of law (misinterpretation).

e. The FTCA settlement authority's limits upon considering an appeal or request for reconsideration are set forth in AR 27-20, paragraph 4-7 . However, the provisions of the FTCA limit the original or successor settlement authority in that an award, compromise, or settlement is final and conclusive and constitutes a complete release.

2-79. Retention of file

See AR 27-20, paragraph 13-4 .

a. When a claim is denied, the ACO or CPO should retain the claim file until at least 3-4 months after the six-month period for filing suit, or the 60-day appeal period, has expired.

b. When a claim is paid, the file should be retained until a comeback copy of the payment report or other proof of payment is received.

c. Because a file cannot be retired until the reason for its disposition is entered into the database, proper entries are required prior to forwarding the file for retirement.

d. A closed file should be retained until final action is taken on any companion claim arising out of the same incident.

e. When a file is forwarded to the USARCS as a matter beyond the local monetary jurisdiction, consider retaining a duplicate file. If the mirror file system is used, only the originals or essential documents, such as SF 95, (and attachments) proof of authority to file, and so forth., need to be forwarded upon transfer. Thereby, a complete file is available at the ACO or CPO if suit or appeal is filed.

Section X
Payment Procedures

2-80. Fund sources

See AR 27-20, paragraph 2-59 .

a. Military Claims Act. Amounts less than $100,000 are paid from Army funds and amounts over $100,000 are paid by the Department of the Treasury Financial Management Service from the Judgment Fund ( see 31 U.S.C. § 1304). This monetary limit applies to each claim, not to each claims incident. For example, one incident may give rise to a claim for personal injury and a claim by the injured party's spouse for loss of consortium. These are considered two separate claims even though they arise from one incident. The limit applies also to claims filed jointly. Thus, settlement of a joint claim must specify the settlement amount for each claimant.

b. Federal Tort Claims Act. FTCA settlements of $2,500 or less are paid from Army funds on all claims except civil works claims, which are paid from civil works funds at the COE district level. FMS pays all settlements above $2,500 on all FTCA claims, including civil works claims, from the Judgment Fund. This monetary limit applies to each claim, not each claims incident. For example, a subrogee's claim for $3,000, which includes the subrogor's paid and fully subrogated $500 deductible, constitutes one claim and is payable by the FMS. If the insurer is merely acting as its insured's collection agent, however, and has not paid the deductible, both claims are payable from Army funds.

c. Non-Scope Claims Act. Claims brought pursuant to this statute are payable from Army funds, even though the aggregate payment for all claims resulting from one incident exceeds $2,500.

d. NATO Status of Forces Agreement. NATO SOFA, including Partnership for Peace (PFP) claims arising in the United States are paid in the same manner as FTCA or MCA claims, 10 U.S.C. § 2734b. After paying these claims, USARCS seeks reimbursement from the sending State for its share in accordance with the treaty's terms.

e. Army Maritime Claims Settlement Act.

(1) Claims against the United States brought pursuant to this statute are paid from Army funds except where the claim arises out of civil works activities, in which case the claim is paid from civil works funds for amounts not to exceed $500,000. The Secretary of the Army certifies settlements greater than $500,000 in their entirety to Congress for payment.

(2) An AMCSA claim in favor of the United States is paid into the U.S. Treasury upon settlement but a claim paid under the Rivers and Harbors Act arising from a civil works activity is paid into COE operating funds at the COE district level.

f. Foreign Claims Act. FCA claims payments are funded from the same source as are MCA claims. The methods for issuing these payments differ. The check will be drawn on the currency of the country in which payment is to be made in accordance with AR 27-20, paragraph 10-9 , at the Foreign Currency Fluctuation Account exchange rate in effect on the date of approval action. Obtain permission from the Commander USARCS if a payee requests payment in U.S. currency, or the currency of a country other than that of the payee's country of residence. Where payment must be approved at USARCS or a higher authority, USARCS will complete and sign the voucher and forward it to the original commission for local payment.

g. United States Postal Service. Claims by the U.S.Postal Service are settled by USARCS and are paid from Army funds.

h. AAFES or NAFI claims. AAFES or NAFI claims are paid from nonappropriated funds. Depending on the settlement amount, send the claim to the appropriate office listed below.

(1) CONUS AAFES. Send payable claims generated by CONUS AAFES activities to: Headquarters, AAFES ATTN: FA-T P.O. Box 650428 Dallas, Texas 75265-0428.

(2) Korean AAFES.

(a) Send claims payable for under $2,500 generated by Korean AAFES to: Korea Sales District ATTN: FA, Unit 15555 APO AP 99205-0003.

(b) Send claims payable for $2,500 or more generated by Korean AAFES to: Headquarters, AAFES ATTN: FA-T P.O. Box 650428 Dallas, Texas 75265-0428.

(3) Japanese AAFES.

(a) Send claims payable for under $2,500 generated by Japan AAFES activities to: AAFES-Yokata ATTN: PACRIM-FA-JAPAN Unit 5203 APO AP 96328-5203.

(b) Send claims payable for $2,500 or more generated by Japanese AAFES to: ATTN: FA-T P.O. Box 650428 Dallas, Texas 75265-0428

(4) Okinawan, Guam and Thailand, etc. AAFES.

(a) Send claims payable for under $2,500 generated by AAFES activities in Okinawa, Guam, Thailand, and other Pacific areas not specifically listed above to: AAFES-PACRIM-ASC ATTN: FA Unit 35163 APO AP 97378-5163.

(b) Send claims payable for $2,500 or more generated by AAFES activities in Okinawa, Guam, Thailand, and other Pacific areas not specifically listed above to: Headquarters, AAFES ATTN: FA-T P.O. Box 650428 Dallas, Texas 75265-0428.

(5) European Regional AAFES. Send all claims payable in any amount generated by European Regional AAFES activities to: Headquarters, AAFES ATTN: FA-T P.O. Box 650428 Dallas, Texas 75265-0428.

(6) Other NAFI claims.

(a) Other NAFI claims over $100. Send claims over $100 generated by other NAF activities to the address shown below. When sending household goods or hold baggage shipment claims for payment, forward the entire claim file so the Army Central Insurance Fund can pursue carrier recovery. Use the "NF" PCMS database transaction code. Army Central Insurance Fund ATTN: CFSC-FM- I 4700 King Street Alexandria, Virginia 22302-4406.

(b) Other NAFI claims under $100. Send claims of $100 or less generated by other NAFI activities to the NAFI activity responsible for payment from its funds (see AR 215-1, para 14-19 ).

(c) COE claims. See paragraph 2-81e for information about where to send payment documents for this type of claim.

i. AAFES or NAFI claims: proportionate liability.

(1) Such claims may be paid proportionally from appropriated and nonappropriated funds if entities funded by both are liable. The following are examples:

(a) AAFES or a NAFI is responsible for maintaining a building and its surrounding area (such as a parking lot). If the claimant was injured by a hazard known to the NAFI occupant, that agency's failure to place a work order with the local Directorate of Public Works (DPW) or similar agency should result in payment from the NAFI. A different outcome may result, however, if the NAFI submitted a work order and DPW unreasonably failed to correct the hazard.

(b) A claim for a child's hot water physical injury arises from the family child care provider program. In this case, DPW was required by regulation to adjust the water temperature to a maximum of 110 degrees Fahrenheit. Its failure to do so results in a claim payable from appropriated funds, in the absence of negligence by the family childcare provider.

(c) A claim for damage from a struck golf ball is not payable from nonappropriated funds unless actions under the control of the golf course manager, such as placing a practice tee too close to a fairway, caused the damage. In contrast, if the damage results from placing public roads in or around the golf course, the claim should be paid from appropriated funds. Damage resulting from a golfer's act is that golfer's responsibility.

(d) A personal injury may occur at a NAFI facility or program in which the negligent employees' salaries or wages are paid from both appropriated and nonappropriated funds. Liability must be apportioned after an investigation, as the injury may have been caused by both lack of supervision (a NAFI tort) and faulty architectural design (an appropriated fund responsibility).

(2) The goal of an apportionment is to reach a resolution that is satisfactory to both the NAFI or AAFES on one hand and FMS on the other. The Judgment Fund cannot be used if a claim is payable from other government funds or programs, including nonappropriated funds. Record this aspect of the claims investigation, making sure to justify the percentage of apportionment assessed.

j. Jointly payable claims. Claims payable by both the United States and a joint or successor tortfeasor require the same type of investigation and analysis used in single payor claims.

k. Rental vehicles. Claims involving rented vehicles that fall within the SDDC rental car contract are payable by the rental company or its insurer up to policy limits. The government pays any excess above policy limits under FTCA, MCA, or FCA procedures.

l. Flying club claims. The Central Insurance Fund maintains full insurance coverage on NAFI flying clubs. If, however, the settlement reaches or exceeds the policy limits, FTCA liability may attach, in which case the excess is paid under FTCA procedures. An example is a midair collision between a flying club plane and a civilian plane caused by both pilot error and faulty weather information supplied by an Army controller.

m. Effect of subrogation. A subrogee may be paid as a claimant but not as a lienholder. Subrogation results from a preexisting agreement or contract or by operation of state law. A claimant's vehicle and health insurance carriers are obliged under contract to pay medical bills up to the policy limits. state law determines whether either carrier is a subrogee or a lienholder. If the insurer is not a subrogee, payment must be made to the injured party who assumes the duty to pay the lien by executing the settlement agreement. As an exception, the Centers for Medicare and Medicaid Services may be paid directly for a Medicare lien. A sample letter providing authorization for such payment as well as a sample settlement agreement are posted on the USARCS Web site at "Claims Resources," II, a, no. 27 and II, b, no. 9, respectively. A state Medicaid lien is paid through the claimant to the state medical or similar agency. TRICARE is not a subrogee or lienholder and is not paid at all, either by payment made through the claimant or direct payment.

n. Structured settlement. Make the check payable to the broker who will distribute the funds in the manner set forth in the settlement agreement.

2-81. Payment documents

See also, AR 27-20, paragraph 2-59 .

a. Notification. Once prepared, the original payment documents must be sent to the claimant or the claimant's attorney to obtain the required signatures. Sample transmittal letters are posted on the USARCS Web site at "Claims Resources," II, c, nos. 17 and 18. Separate samples are provided for pro se and represented claimants. In addition, at this site, readers may view completed samples of all of the forms discussed in this paragraph. To obtain blank copies of these forms see the heading for section II of appendix A for Web sites where blank copies may be downloaded.

b. General. For tort claims paid from Army funds, prepare the following documents:

(1) For all claims, a DA Form 7500 (Tort Claim Payment Report) is required. It must be signed by a properly designated settlement or approval authority who is certifying the payment. The Tort Claim Payment Report for a given claim may be generated from the Claim Transaction screen in the Tort and Special Claims Application database by clicking the link "payment report." The form will appear with most of the information pre-supplied from the claim record. You may add or modify information as necessary. The payment report serves as a settlement agreement and will be signed by the claimant unless a separate agreement is needed. A separate Tort Claim Payment Report will be completed for each claimant, except in a structured settlement where the payee is the broker on behalf of all claimants. The proper accounting classification must be entered on the payment report except for claims paid by a NAFI, AAFES, or the COE.

(2) A copy of a settlement agreement when a separate settlement agreement is used. If a separate agreement is used, the claimant's attorney's signature may appear as acknowledgment of the settlement; the claimant's attorney may not sign as a party to the settlement. Attorney fees will not be made payable separately from the cash sum payable to the claimant.

(3) A copy of the claim, usually an SF 95 , and proof of authority to sign (guardianship decree, attorney's representation agreement, documents authorizing a corporate officer or a representative of the estate to sign, as appropriate).

(4) A copy of an action (see para 2-72 ) or a DA Form 1668 (Small Claims Certificate), as appropriate.

(5) The SF 95 or claim form and DA Form 7500 (Tort Claim Payment Report) will be faxed to the DFAS office. Retain an original of the documents listed above in the claim file. It is suggested that claims officers meet with their DFAS point of contact and review the payment report to ensure acceptance by DFAS.

c. Tort Claim Payment Report, DA Form 7500. Enter the described information in each of the corresponding block numbers, as listed below.

(1) Identification number of your servicing DFAS office.

(2) Date document prepared.

(3) Name of claims office submitting Tort Claim Payment Report.

(4) Office code of submitting claims office.

(5) Agency/office mailing address.

(6) Date claim filed.

(7) Claim number(s).

(8) Amount claimed.

(9) Fund cite.

(a) Accounting citation. Charging an approved claim against a particular accounting citation creates an obligation against the claims appropriation for the current fiscal year. Accordingly, the payment report will bear the correct account code for both the appropriation charged and the current fiscal year, regardless of the date the claim accrued or was filed. Confusion sometimes arises at the end of a fiscal year. For example, an approved claim is certified for payment on 28 September, but it is obvious that the payment will not actually be processed until the next fiscal year, beginning 1 October. At the time the check is issued, the accounting code will not be advanced to the next fiscal year. Only the accounting code for the fiscal year in which the funds were obligated and the claim was certified for payment (the payment report was signed) should be charged.

(b) Accounting codes. Each fiscal year, the AR 37-100 series publishes separate payment and refund codes for claims payments made pursuant to each chapter of AR 27-20 . All elements of the accounting code for each type of claim, except the third digit, remain constant (unless otherwise notified by fiscal authorities). The third digit represents the second digit of the fiscal year. For example, in the payment of an FY 07 FTCA claim, the FTCA payment code would appear as 2172020 22 0203 P436099.21-4200 FAJA S99999.

(10) Name of payee.

(11) Address of payee.

(12) Social Security number or Taxpayer Identification Number (TIN). Please note, in a structured settlement where the total monetary award will be paid to the broker for distribution as outlined in the structured settlement agreement, the Employer Identification Number (EIN) of the broker to whom payment is made will be reflected.

(13) Payment amount.

(14) Type of payment (for aN MCA claim enter either "advance payment" or final payment. For other payments enter "final payment."

(15) ABA routing number for electronic payment

(16) Payee's account name and number.

(17) Name and address of financial institution where payment to be made.

(18) Specify either "checking" or "savings" account.

(19) Signature of claimant.

(20) Date of claimant's signature.

(21) Signature of authorized certifying officer.

(22) Date of signature of authorized certifying officer.

(23) Title of authorized certifying officer.

(24) Date payment recorded in claim record/database.

d. Tort Claim payment report - additional information. The area of the DA Form 7500 (Tort Claim Payment Report) identified as "Section B - Acceptance by Claimant" is to be dated and signed in original by claimant, except where another settlement acceptance agreement has been executed. The area of the DA Form 7500 identified as "Section C - Agency Certifying Officer" is to be completed by the CJA or claims attorney authorized to approve payment of settlement award.

e. Payment documents for AAFES and NAFI Claims. For claims to be paid from AAFES funds, submit the following documents to the appropriate AAFES activity. Specific addresses are provided at para 2-80h . Sample transmittal memos for forwarding payment documents to a specific AAFES Service office (see para 2-80h) or to the Army Central Insurance Fund (for NAFI claims other than AAFES claims, as discussed in para 2-80h(6) ) are posted on the USARCS Web site at "Claims Resources," II, b, nos. 1 and 2.

(1) Action Memorandum, (see para 2-72 ).

(2) SF 95 , Claim.

(3) DA Form 1666 -Claims Settlement Agreement, or other form of settlement agreement, if appropriate.

(4) For claims generated by NAFI activities other than AAFES, prepare the documents listed below. See subpara 2-80h(6) for information as to where to send the documents.

(a) Action Memorandum, (see para 2-72).

(b) SF 95, Claim.

(c) DA Form 1666, Claims Settlement Agreement, or other form of settlement agreement, if appropriate.

f. Payment of COE claims.

(1) Claims payable under $2,500.

(a) COE civil works claims are paid by the responsible COE district from civil works funds if the amount is $2,500 or under.

(b) If an approval authority other than a COE authority approves a claim arising out of the activities of the COE district, for $2,500 or less, the action, the SF 95 and DA Form 1666 will be referred to the responsible district for payment. A sample transmittal letter to COE is posted on the USARCS Web site at "Claims Resources," II, b, no. 3.

(2) Amounts paid over $2,500. COE claims payable in an amount greater than $2,500 will be paid from the Judgment Fund using the procedures set forth below.

g. Judgment fund payments. For all claims to be paid from the Judgment Fund, in whole or in part, submit the following documents to the Department of the Treasury, Financial Management Service (FMS). In addition to being able to access these forms as discussed in subpara a of this paragraph, these forms are available as fillable forms for any claim entered in the TSCA database. In the Claim Transaction screen for the claim, click on the link "Create DA Form 7500 , 1666, or 1668 ." The database will automatically fill some of the blocks. Any block may be edited or filled by the user as needed. These forms may also be obtained from a Web site maintained by the Department of Treasury, FMS at http://fms.treas.gov/judgefund . The Treasury Financial Manual is available the home page http://fms.treas.gov

(1) Original of FMS Form 194, Judgment Fund Transmittal. A sample completed FMS Form 194 is posted on the USARCS Web site at "Claims Resources," II, b, no. 13.

(2) Original of the FMS Form 196 (Judgment Fund Award Data Sheet) is prepared for each claimant receiving a monetary award. A sample of a completed FMS Form 196 is posted on the USARCS Web site at "Claims Resources," II, b, no. 14.

(3) Original of Page 1 of the FMS Form 197, (Judgment Fund Voucher For Payment).

(4) Where a claimant has not signed another agreement and is not represented by an attorney, page 2 of FMS Form 197 will be signed and dated by the claimant at item 10. This serves as a settlement agreement and acceptance by the claimant. Block 11 of FMS Form 197 will be signed and dated by the claims officer certifying the payment on all payments submitted to FMS, regardless of the type of settlement agreement used. A sample of a completed FMS Form 197 is posted on the USARCS Web site at "Claims Resources," II, b, no. 15.

(5) Original of the claim, usually SF 95 , and proof of authority to sign (guardianship decree, attorney's representation agreement, documents authorizing a corporate officer or a representative of the estate to sign, as appropriate).

(6) Original of the settlement agreement, when a separate settlement agreement is used in lieu of FMS Form 197.

(7) An action (see para 2-72 ) or, where the settlement has been approved by the Attorney General's designee for a FTCA claim or by DJAG or Army General Counsel for a MCA, NGCA, or FCA claim, a copy of the approval document.

2-82. Finality of settlement

Payment of a claim pursuant to a duly executed and agreed settlement precludes further payment; the settlement is final, 28 U.S.C. § 2672 (FTCA) and 10 U.S.C. § 2735. Since all claims are paid under a limited waiver of sovereign immunity, there is no authority to pay additional amounts later. Under the FTCA a paid settlement amount may be corrected only where error results in a payment less than the mutually understood settlement amount, see AR 27-20, paragraph 4-7 . For settlements paid under other statutes see paragraph 2-78c . Claimants must be advised before accepting payment of their right to either request reconsideration or appeal, as specified in the chapter of AR 27-20 under which final action was taken. See FTCH § II, B5a(9) and F8 for a discussion of cases on the finality of settlement.

Chapter 3
Claims Cognizable Under the Military Claims Act

3-1. Statutory authority

a. The Military Claims Act (MCA), 10 U.S.C. § 2733, was enacted on 3 July 1943. It provided retroactive coverage of claims occurring on or after 27 May 1941; President Roosevelt declared a national emergency on that date. The MCA was intended primarily to establish a new system of compensation for both personal injuries and property losses caused by newly mobilized troops in civilian communities throughout the United States, its territories and possessions and provided a corollary to the Foreign Claims Act (FCA), (10 U.S.C. § 2734).

b. When enacted, the MCA repealed earlier statutes authorizing compensation for damage caused by various Army activities, such as firing site activities, maneuvers, or other military operations (Act of 24 August 1912, 37 Stat. 586), as well as for property damage caused by the U.S. Army Corps of Engineers' (COE) river and harbor work. Act of 23 June 1910, 36 Stat. 630, 676. Congress intended the MCA to replace and expand upon these various authorities.

c. The MCA provides a limited waiver of sovereign immunity. Instead of a judicial remedy, it grants claimants the right to an administrative appeal. The MCA authorizes the Secretaries of the military services to issue regulations governing these claims. Courts have consistently upheld the constitutionality of these administrative regulations; decisions made thereunder are final and conclusive, Rodrique v. United States, 968 F.2 d 1430 (1st Cir. 1992), Hata v. United States, 23 F.3 d 230 (9th Cir. 1994), Schneider v. United States, 27 F.3 d 1327 (8th Cir. 1994) cert. denied, 513 U.S. 1077 (1995).

d. Initially, the MCA limited payment of personal injury or death claims to costs of medical, hospital, or burial services actually incurred, 57 Stat. 372, chapter 189. The MCA initially limited payments to $500 ($1,000 per claim in time of war). Any settlement constituted full and final satisfaction of the claim. Over the years, Congress raised the $500 monetary limitation by increments; presently, there is no maximum. Until the 1970s USARCS was required to submit annually to Congress the name and amount of each claim settled. It was also required to refer any claim settled for more than $100,000 to Congress for a deficiency appropriation for the excess, since only the initial $100,000 was paid from agency funds. This schedule remains in effect, except that any amount over $100,000 for each claim is now paid from the Judgment Fund, 31 U.S.C. § 1304.

3-2. Scope

a. History. From the outset, the MCA has had worldwide application. For many years, however, it was used primarily to process claims arising within the United States. (The FCA was used to process claims brought by persons residing overseas during the time when few dependents accompanied troops abroad.) Until the enactment of the Federal Tort Claims Act (FTCA), the MCA was the paramount statute for administering tort claims based on Soldiers' negligent or wrongful acts or omissions within the United States. While the FTCA did not repeal the MCA, by its terms it became the preemptive federal negligence remedy, Act of 2 August 1946 as part of the Legislative Reorganization Act of 1946, chap. 753, §§ 401 through 424 (FTCA), Pub. L. No. 79-601, 60 Stat. 812-844 at 842. However, the FTCA did not attenuate the MCA's other provisions governing claims arising from noncombat activities. Additionally, the MCA continues to cover claims for loss of or damage to bailed personal property or insured mail in the Army's possession or claims engendered by the military's use and occupancy of real property. The FTCA had no effect on the administration of claims occurring outside the United States or claims by Soldiers for property damage or loss incident to service not cognizable under the Personnel Claims Act (PCA). Thus, the Army claims system continues to process a broad variety of claims under the MCA that neither the FTCA nor the FCA covers.

b. Negligence claims. As a matter of policy and to the extent possible, MCA negligence claims are processed and interpreted through the FTCA's implementing regulations and case law. The MCA applies to claims caused by an act or omission determined to be negligent, wrongful or otherwise involving fault of military personnel or civilian officers or employees acting within the scope of their employment outside the United States. Claimants are usually United States residents who are not proper claimants under the FCA or a Status of Forces Agreement (SOFA). To be payable, a claim must assert a tort under general principles of law applicable to a private individual in the majority of U.S. jurisdictions. See FTCH § II, B1 through B4(a) for guidance.

c. Noncombat activity claims. The MCA governs claims arising throughout the world, incident to authorized activities which are essentially military in nature, that have few parallels in civilian pursuits, and which historically are a proper basis for payment of claims. Examples are practice firing of missiles and weapons; training and field exercises, and military maneuvers, including the operation of aircraft and vehicles; use and occupancy of real estate; movement of combat and other vehicles designed for military use; and certain civilian activities over which the COE historically has had exclusive jurisdiction. Activities carried out incident to combat, whether in time of war or not, and the use of military personnel and civilian employees in connection with civil disturbances or disasters are excluded from consideration under the MCA.

3-3. Claims payable

a. General. A valid MCA claim is based on the negligent or wrongful act or omission of a Soldier or civilian employee, see AR 27-20, paragraph 2-2b . As an exception, the acts or omissions of members of the Army National Guard (ARNG) while employed in training duty under the National Guard Claims Act (NGCA), 32 U.S.C. §§ 316, 502, 503, or 505 are outside the MCA's scope of coverage. Within the United States, ARNG claims fall under Title 31 and the FTCA. Outside the United States, all ARNG claims fall under Title 10 and either the MCA or the FCA may be applied. If such claims arise from noncombat Army activities that are not normally activities of a state, they may fall under the NGCA. Similarly, contractors of the United States are not employees under the MCA. See chapter 2, Section V , Determination of Liability.

b. Noncombat activity claims.

(1) Noncombat activity claims are payable based on causation alone, so there is no requirement for a finding of negligence. Advance payments may be made in certain situations such as disasters. Thus, if a military aircraft crashes into a shopping center and causes serious injuries and property damage, the adjudicating authority may make advance payments almost immediately for medical care and other essential services, including business rehabilitation. These payments should not be made to possible joint tortfeasors, such as contractor employees aboard the aircraft, or to federal, state, local or nongovernmental organizations that provide monetary or in-kind assistance. Payments must be made to injured parties. Where there is a large number of actual or potential claims, coordination with the Commander USARCS is required prior to making a payment. For guidance concerning real estate claims see paragraph 2-15m of this publication.

(2) Claims arising from noncombat activities should be processed under the MCA, even though subsequent investigation may indicate a negligent or wrongful act or omission by a Soldier or employee. If the claimant elects the FTCA and files suit, follow normal FTCA procedures thereafter. Take care, however, to restrict the use of the noncombat activities provision to those activities historically falling within its definition. For example, if a military sedan causes an accident on a paved highway during a maneuver within the continental U.S. (CONUS), the claim should be processed under the FTCA, but a claim arising from an accident involving a tank on a paved highway during a maneuver within CONUS should be processed under the MCA.

(3) Frequently, claims incident to noncombat activities are processed under the MCA without investigating the issue of negligence. Blast damage claims are payable if the Army caused the damage. A blast damage claim might involve a possibly negligent act such as locating a new impact area near an off-post housing area. Similar damage claims caused by nap-of-the-earth flying are payable under the MCA as noncombat activity claims, even though the act of determining whether such flight constitutes a violation of the Federal Aviation Adminstration's suggested flying limit of 500 feet above ground may fall under the FTCA's discretionary function exception. See FTCH § II, B4c(1).

(4) Advance payments should not be made if the claimant was wholly or partially negligent and the incident occurred in any place whose courts impose the legal doctrine of either contributory or comparative negligence. The MCA permits payment of such claims only to the extent that the law of the place of occurrence would allow individual recovery in similar circumstances. While the contributory negligence bar probably would not prevent advance payments to persons injured in the shopping mall incident described above, it would likely affect the claims of scavengers injured while removing a dud from an impact area on a military installation.

(5) Similarly, advance payments should not be made when the principal tortfeasor is a contractor engaged in manufacturing, storing or transporting ordnance or in demilitarizing chemicals or other toxic materials.

(6) Claims personnel may consider claims arising out of some civil works activities under the noncombat activity provision. Historically, the COE has exercised sole jurisdiction over certain civil works activities. As an example: in constructing a new dam, the COE will take an easement to the estimated water boundary, failing to anticipate resultant crop damage. The COE must then take an enhanced easement. However, crop damage sustained before this enhancement is compensable as a noncombat activity claim.

(7) While the MCA's noncombat activity provision should be used to pay such claims within the United States, denials should be processed under both the MCA and the FTCA, as claims are often allegedly grounded in negligence. Sample denial letters are posted on the USARCS Web site at "Claims Resources," II, b, nos. 9 and 10.

c. Soldiers' claims.

(1) A Soldier is a proper MCA claimant for an incident-to-service property loss that is not compensable under the PCA. See subparagraph 2-15a(3). But a Soldier may not recover for an incident-to-service personal injury or death under the MCA, 10 U.S.C. § 2733(b)(3). However, both the MCA and PCA bar all subrogees from recovery. To succeed on an otherwise payable MCA claim, the claimant must show negligence on the part of the United States.

(2) A foreign Soldier stationed in the United States under NATO SOFA is entitled to identical recovery. The law provides that a claim arising in the United States under a reciprocal agreement be processed in the same manner as a claim arising from acts of the U.S. Armed Forces, 10 U.S.C. §§ 2734b and 2734b, the International Agreements Claims Act (IACA). One court interpreted this language to mean that a German Soldier's personal injury claim brought in the United States under the NATO SOFA was barred by the incident-to-service doctrine, Daberkow v. United States, 581 F.2 d 785 (9th Cir. 1978). Since the German Soldier's claim for property damage would be similarly barred under the FTCA, it would fall under the MCA, if the foreign government had no law equivalent to the PCA.

d. Bailments.

(1) Bailment claims fall under the MCA. Property of a person other than a Soldier on active duty is not covered by the PCA but is compensable under the MCA. Property damaged by a dry cleaning concessionaire is the responsibility of the concessionaire, however, and thus outside the MCA's coverage. Property left in an unattended Army club cloakroom is not covered and claims for its loss are not payable under the MCA. The mere absence of warning signs at the Army club does not provide a basis for payment. Property stored at other activities operated by morale services (such as, stables, marinas and golf courses) is usually not considered bailed property as it is stored either at the owner's risk or outside the NAFI's control.

(2) Seized and abandoned property.

(a) Property seized as evidence by military police and not returned, or returned in a damaged condition, is not compensable if the detention of goods exclusion applies, 28 U.S.C. § 2680(c). See FTCH § II, B4e. It is possible that a Fifth Amendment taking has occurred; a bailment may have been created that is cognizable under the MCA (10 U.S.C. § 2733) or the Tucker Act (28 U.S.C. § 1346). Seek guidance from USARCS.

(b) Whenever personal property is seized, minimum due process includes affording the person from whom it was seized, or its registered owner, the opportunity to regain custody. Conducting an initial inventory of the condition and amount of property seized and another inventory upon the property's return is the best way to determine damage.

(c) A claim for property abandoned on a military reservation and damaged or improperly disposed of may be compensable if the persons responsible failed to follow the disposal procedures set forth in DFAS-IN 37-1 , chapter 14, para 1404. In any case, the amount for which the property was sold is recoverable from the Defense Reutilization and Marketing Office.

e. Claims for rent, utilities, custodial services and incidental damages. Claims for damages incidental to the use of real property occupied under an express or implied lease, usually during an operation, deployment or manuever are contractual claims and should be considered under COE procedures. See paragraph 2-15m .

f. Registered and insured mail. See discussion at paragraphs 2-15i(3) and 2-56g .

3-4. Claims not payable

a. Claims in foreign countries.

(1) Outside the United States, the MCA provides remedies for United States inhabitants similar to those the FTCA provides within the United States. The MCA may be invoked by Soldiers, U.S. civilian employees, family members of Soldiers and U.S. civilian employees, and U.S. civilians, tourists or citizens not permanently residing in a foreign country, unless a current SOFA governs, in which case the latter provides these claimants a preemptive remedy. In both the Federal Republic of Germany (FRG) and Korea, members of the U.S. Armed Forces and its civilian component as well as their family members must file under the MCA, both for claims arising from an act or omission by a U.S. service member or civilian employee done in the performance of official duty, or for any other matter for which the force is legally responsible under receiving State law. Neither country considers the foregoing as proper claimants under the SOFA. A retired U.S. Soldier residing permanently in a NATO SOFA foreign country qualifies as a third-party claimant under the FCA or SOFA unless the retiree is currently employed by DOD and is a member of the civilian component. In certain other countries (such as Belgium, the Netherlands, France and Denmark), Soldiers and U.S civilian employees and their family members may claim under the NATO SOFA. These parties may also file claims under the MCA if a consistent and widely available alternative claims process of this nature has been established within the receiving State.

(2) A remedy under the SOFA is preemptive. See the FTCH § II, B5h. In FRG, the German Implementation Law requires a claimant to file a NATO SOFA claim within three months of the date of accrual; Korean law sets out a requirement to file a Korean SOFA claim within three years of the date of accrual. A claim accrues on the date the claimant knew or reasonably should have known that he or she may have a claim against a member of the U.S. forces. Command claims services should direct eligible claimants to the appropriate receiving State claims office and advise them of the relevant filing period. The filing period normally starts to run immediately (for example, following a car accident with a military vehicle). It is not tolled until the claimant learns of a specific remedy or how and where to file a claim. If the filing period has expired, claimants may request the Commander USARCS to consider their cause of action under either the MCA or the FCA for good cause or excusable delay. Any such request must be filed within two years of accrual. Reinstatement is never granted without such a request, no matter how good the cause. Inform the claimant where to file a claim with the receiving State claims office (RSCO) and of the filing time requirement. If the RSCO denies the claim on the merits, for example, by finding neither liability nor damages, both the MCA and the FCA normally will bar recovery. The claimant's only option is to appeal such decision to a host nation court within the appropriate time period established by the host nation after receipt of the RSCO decision. The command claims service will review the RSCO rejection for jurisdictional reasons (for example, not a proper party claimant) and discuss the rejection with the RSCO before requesting permission from the Commander USARCS, through the Foreign Torts Branch, to consider the claim under the MCA or the FCA. See AR 27-20, paragraph 7-12 . The Commander USARCS may in his discretion grant recovery if the claim is otherwise meritorious. While the SOFA claims process is exclusive, a waiver may be granted in appropriate cases; for example, where the claimant has been misadvised by government officials as to the proper remedy, provided the claimant has exercised due diligence pursuing the claim.

b. Prohibition on incidental or consequential property damage.

(1) Both the MCA and the FTCA limit compensation for property loss or damage to tangible property. See subparagraph 2-56a and the FTCH § II, C26. Incidental or consequential damages are not compensable. Examples of indirect or consequential damages include attorneys' fees associated with defending administrative or criminal charges (except where a tort for malicious prosecution lies); loss of schooling or employment due to an erroneous enlistment; bad check charges; loss of rental deposits; medical bills resulting from an adverse decision under TRICARE; third-party claim paid by a volunteer ("rich uncle"); expenses incurred in connection with erroneous permanent change of station (PCS) orders. Upon receiving such a claim, screen the related remedies found at paragraph 2-17 and direct the claimant to the appropriate one. In the absence of another remedy, accept the claim and deny it under the MCA or the FTCA, as applicable. A claimant should never be denied the right to file a claim.

(2) In any given case, if command interest so dictates and the claim, after investigation, is deemed otherwise meritorious, advise the unit commander to pursue the matter through command channels for consideration of settlement from the Secretary's contingency fund. Ensure that the claimant's consequential loss was unavoidable and resulted solely from the Army's or Department of Defense's (DOD's) actions or omissions.

(3) The claimant may send claims arising out of DOD finance operations directly to the Department of Defense Office of Hearings and Appeals (DOHA) for consideration under the Meritorious Claims Act, 31 U.S.C. § 3702. It is a prerequisite, however, that the claim not be payable by other means, such as from agency funds.

(4) Do not advise a claimant to seek a private relief bill (considered by Congress) as such advice implies that the executive branch would view the requested relief with favor.

3-5. Applicable law

a. Until 1958, the MCA expressly limited payment of personal injury and death claims to out-of-pocket expenses. In enacting the MCA, Congress permitted the military services to conduct their necessary operations while maintaining public cooperation and, in particular, the local community's good will. Payments duplicating those already made by others (such as insurers) would hinder, rather than further, these aims. Collateral source payments fall into this category. For definition, discussion, and current case law on the collateral source rule, see FTCH § II, C10. Similarly, payments to insurance companies as subrogees are barred. The regulations implementing both the PCA and the FCA have always barred such payments. Since the MCA serves the same general purposes as does the FCA, it provides no new reason to pay subrogees. Note, however, that a Soldier may file for property loss or damage pursuant to the MCA without first filing with an insurer.

b. Only one claim is permitted for wrongful death. Where multiple claims are submitted, inform the representative in writing that separate claims for the estate and each survivor are not permitted and the multiple claims will be acted on as one claim. If denied, all claims will be denied as one. If paid, they will be incorporated into one settlement agreement. Because all parties are in effect filing one claim, the initial $100,000 to be paid from the claims expenditure allowance (CEA) is paid only once, the rest by the Judgment Fund.

3-6. Settlement authority

See paragraph 2-69 .

3-7. Action on appeal

Appeals are time-consuming and costly. The higher authority will consider an appeal only if the issues are clearly defined, the Army's position is well supported, and the claimant has been given a meaningful opportunity to support the claim (and has failed to do so) after full disclosure of the legal requirements for considering the claim and the appeal. See paragraphs 2-74 through 2-76 inclusive, and paragraph 2-78 .

a. Upon receipt of an appeal, follow these guidelines before forwarding the file to the appellate authority for final action:

(1) Under principles of American tort law, the burden of proof is on the claimant. This means that a claim should not be denied until the claimant has been informed in very specific terms what proof is necessary, particularly if the claimant is unrepresented and has thus far failed to submit the required proof. Tell the claimant exactly what documents or proof is needed and why. Follow up these discussions with written confirmation. The same holds true for claimant interviews. If the claimant asks the reason for the interview, respond that it is being held to determine the basis for the claim (liability) as well as to obtain information concerning damages.

(2) Rather than rely on a police report in an accident case, go to the scene with the claimant, the Army driver and the police, if necessary. During a damages interview, inform the claimant that settlement is being considered, but never concede liability. In a medical malpractice or other professional negligence action, outline the Army's position after the Army's expert review is completed, without naming the source, except, perhaps, where claimants agree to reciprocate by supplying their own expert opinions. In outlining the Army's position, inform the claimant that, under the FTCA, the court would require an expert opinion before filing suit and that, even though the MCA does not offer a judicial remedy, its procedures also require an expert opinion. See chapter 2 for guidance on investigative methods and techniques and settlement procedures.

b. In a property damage claim, compensation should be limited to documented damages and based on applicable law. Do not add nuisance value solely to settle the claim. This may lead to conflict about whether consequential damages are recoverable. AR 27-20, paragraph 3-5d , lists elements of damages that are not payable. On the other hand, for a claim outside the United States, do not impose the restrictions set forth in AR 27-20, chapter 11 (such as the requirement to order parts through Army and Air Force Exchange Service (AAFES) to avoid the imposition of duty in a foreign country) unless general state or federal law upholds the restriction.

3-8. Payment of costs, settlements, and judgments related to certain medical malpractice claims

a. The MCA procedures may be used to process a claim against the United States for the actions of Army medical trainees engaged in training agreements under which Army health care personnel train at civilian medical treatment facilities (MTFs). Most of these agreements provide that the Army, not the civilian institution, will consider claims arising out of Army trainees' related actions. Applicable state law may subsume such claims under the FTCA; however, the Department of Justice (DOJ) maintains that if the trainee is a loaned servant under state law, then the claim is not payable thereunder despite the plain language of the training agreement. Since this position could deter civilian institutions from entering into future training agreements, in such cases process the claim under the MCA and base any unauthorized payments on state law, since the medical trainee's tort is not cognizable as a noncombat activity claim.

b. The FTCA's procedures may not be advisable for handling certain incidents such as those in which the non-Department of the Army (DA) attending physician, not the DA trainee, is the primary tortfeasor. Discuss the individual case with the appropriate area action officer (AAO). Perhaps the injured party has filed a civil suit against the institution, and the latter is requesting indemnification or contribution. On the other hand, the trainee may be the principal tortfeasor, even if the patient has filed against only the institution or attending physician. Forward all such requests for indemnification or contribution to USARCS.

c. Along with their movement orders, DA health care personnel training at civilian MTFs receive detailed information about their responsibilities if they are involved in a potentially compensable event (PCE). They are instructed to report any lawsuit filed against the trainee individually to both USARCS and, under AR 27-40 , the Army Litigation Center. Nevertheless, there have been unreported individual lawsuits in which a government health care provider hired an attorney and prepared a defense. Courts have held that the FTCA's immunity provisions do not preclude such suits, despite the Westfall Act, 28 U.S.C. § 2679; they may be filed under the Gonzales Act, 10 U.S.C. § 1089. The Westfall Act did not repeal the earlier-enacted Gonzales Act, which permits suit on willful torts, waiving the FTCA exclusion found at 28 U.S.C. § 2680(h). Thus, a plaintiff may file an individual lawsuit against the Department of the Army trainee for physician-patient sexual assault despite the statutory bar at 28 U.S.C. § 2679. See subpara 2-47f(7). Costs and fees as well as awards may be paid under the MCA. See FTCH § II, D1.

d. Notify Army Litigation Division, Tort Litigation Branch, of any lawsuits filed against the training institution regarding the care provided by DA health care personnel training at civilian MTFs.

3-9. Payment of costs, settlements, and judgments related to certain legal malpractice claims

a. The Westfall Act amended the FTCA to preclude suit against a federal employee acting within the scope of employment, 28 U.S.C. § 2679. Accordingly, within the United States, there should be little reliance on the MCA's procedures. In fact, USARCS has not processed any such claims.

b. The MCA may be used outside the United States to award costs resulting from a suit in a foreign court. NATO SOFA, Article VIII, para 5(g) precludes the enforcement of any such judgment against a member of the force or civilian component acting within the performance of official duties. USARCS has not processed any such claims.

Chapter 4
Claims Cognizable under the Federal Tort Claims Act

4-1. Authority

Culminating years of effort, Congress enacted the Federal Tort Claims Act (FTCA), in 1946, applying it retroactively to claims accruing on or after 1 January 1945, 60 Stat. 842, 28 U.S.C. §§ 2671-2680. Since the early 1920s, Congress had considered earlier versions of the FTCA in order to stanch the flow of private relief bills besieging it, finally doing so by enacting the FTCA. This law waives the government's sovereign immunity to tort liability. Its waiver is limited by the conditions it imposes on filing and by numerous exclusions to its coverage. These limitations and restrictions must be strictly construed in favor of the United States, McNeil v. United States, 508 U.S. 106 (1993).

4-2. Scope

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, 28 U.S.C. § 2674. The whole law of the place of occurrence applies. An act or omission rises to the status of an FTCA tort only if the act or omission is an actionable tort in the state where the cause of action arose. The FTCA does not waive immunity for a tort arising from a violation of the U.S. Constitution unless the violation constitutes a state tort as well. If the applicable state law deems the violation a tort, the action must be brought as a state tort rather than as a constitutional tort. See paragraphs 2-35 , 2-36 , and 2-51 .

b. Originally, the FTCA permitted persons to sue without first filing an administrative claim, although claims for amounts up to $1,000 could be brought against the agency concerned. Seeking to lighten the load on the courts and to permit agencies to settle meritorious claims, the Congress amended the FTCA in 1966, requiring an administrative claim as a condition precedent to suit. Under that amendment, effective February 1967, the claimant may file suit six months after the date of filing an administrative claim, for any reason and without regard to the status of any negotiations, 28 U.S.C. § 2675. When suit is filed, the federal agency loses control of the claim and any settlement executed thereafter is controlled by the Department of Justice (DOJ) or the U.S. Attorney. The federal agency plays an advisory role and frequently conducts most pretrial discovery. For Army cases, the Army Litigation Center or its delegee fulfills the Department of Army (DA's) role.

c. Whether the tortfeasor is, or is not, a federal employee is a question of federal law in any claim arising under the FTCA. The compilation of federal employees set forth at AR 27-20, paragraph 2-2b , is based on USARCS' experience over the years but is not intended to be inclusive. Similarly, whether the FTCA claim involves a federal agency is a question of federal law, but the courts have decided most of these issues. For example, the courts have long considered NAFIs and AAFES to be federal agencies. Questions still exist, however, about military spouses' clubs, thrift shops, and other private organizations operating on post or existing solely to support the military community. Depending primarily on the benefits accruing to the government, a private association may be a federal agency for FTCA purposes. Interpretation of the statute of limitations is also a federal question. See paragraph 2-44 . The DOJ has always considered the statute of limitations requirement contained in 28 U.S.C. § 2401(b) jurisdictional in nature. The doctrine of equitable tolling discussed in a 1990 Supreme Court decision casts doubt on this position, however, Irwin v. Department of Veterans Affairs, 498 U.S. 89 (1990), modified by Lampf, Pleva, Lipkind, Prupis and Petigrow v. Gilbertson, 501 U.S. 350 (1991). See FTCH § I, D1c. Scope of employment is a state law question. See paragraph 2-46 and FTCH § I, B3.

d. The Army's administrative claims settlement program has been a success since its inception in 1967. Many federal agencies have no such program. Others maintain only minimal programs. The Army's program has succeeded because it calls for the area claims office (ACO) or claims processing office (CPO) to coordinate from the outset with the appropriate area action officer (AAO), to investigate and select claims for favorable action promptly, and to communicate with the claimant to maintain the latter's interest in pursuing the administrative process instead of suing. The brief six-month period before suit is permitted is designed to compel attention and quick action.

e. The U..S. Attorney General's regulations implementing the FTCA, 28 C.F.R. §§ 14.1-14.11 are available on www.gpoaccess.gov . A legislative history of the FTCA that includes a bibliography is posted on the USARCS Web site on JAGCNet at "Claims Resources," I, a, 3(a).

4-3. Claims payable

For discussion on whether to consider a claim under the FTCA or the MCA's noncombat activities provision, see paragraph 3-3 . See also, chapter 2, Sections V and VI , Determination of Liability and Determination of Damages, respectively.

4-4. Claims not payable

A claim is not payable if it is identified as an exclusion in paragraphs 2-36 through 2-43 .

4-5. Applicable law

See para 4-2 , as well as chapter 2, Sections V and VI, Determination of Liability and Determination of Damages, respectively.

4-6. Settlement authority

See paragraph 2-69 .

4-7. Reconsideration

See paragraph 2-78 .

Chapter 5
Non-Scope Claims Act

5-1. Statutory authority

The Non-Scope Claims Act (NSCA), 10 U.S.C. § 2737, was enacted in 1962 as a supplement to Article 139, Uniform Code of Military Justice (UCMJ), a recovery statute that requires proof of a willful act and limits compensation to property loss or damage. The NSCA does not require proof of willful act and covers personal injury as well as property damage. Both the NSCA and Article 139 are designed to provide compensation for damage caused by Soldiers who are not acting within the scope of their employment. In this sense, they parallel the Foreign Claims Act (FCA), which also has no scope requirement.

5-2. Scope

Payments under the NSCA are limited to $1,000 of non-indemnifiable (out-of-pocket) expenses arising from property loss, personal injury or death caused by the non-scope use of a government-owned vehicle (GOV), whether on or off post, or the non-scope use of other government property, such as a weapon or golf cart, on post. Because it is Department of Justice (DOJ) policy that a claim may not be settled if other claims, actual or potential, arising out of the same incident might lead to litigation, all parties to the settlement must agree that it is final. This requirement even applies to the insurer who may have paid for property loss or medical bills, even though the insurer is not a proper claimant under the Act, 28 C.F.R. § 14.6 . Where the evidence of a non-scope act is clear and convincing, the requirement that all parties agree to the settlement poses no problem. Often, however, the scope determination may not be clear and the agreement of all parties may be difficult to obtain.

5-3. Claims payable

a. Consider applying the NSCA whenever a decision is reached to deny an FTCA, Military Claims Act (MCA), or National Guard Claims Act (NGCA) claim because the government driver or user was not within scope.

b. To enable such a determination, the officer or government employee who supervised the user of the property should furnish a scope certificate, posted on the USARCS Web site at "Claims Resources," II, a, no. 22. The sixth numbered paragraph of the scope certificate applies solely to the NGCA. Other formats may be used. A checklist for scope of duty analysis is also posted on the USARCS Web site at "Claims Resources," II, a, no. 8. The scope certificate is not definitive and additional investigation should be conducted when circumstances indicate, for example, where time and distance factors appear suspicious (such as a recruiter driving an applicant home in a GOV at 0200, and home is 50 miles away from the recruiter's office). Using a GOV without authority is punishable under the UCMJ, but it is not necessarily outside scope if such use is usual and customary, for example, driving a GOV off post to a fast food establishment. Using a vehicle to drop off one's dry cleaning while on a mission to obtain supplies is not necessarily non scope, if the applicable state law has adopted the dual purpose doctrine, which means that an employee may be acting for himself and his employer simultaneously. Intoxication alone may not remove a driver from the scope of employment. Always examine the applicable state law in light of the factual setting.

c. Practical aspects are usually involved in a scope determination. Scope is presumed whenever an authorized driver is operating an Army or official vehicle. This means that the burden of proving otherwise rests on the United States. Court decisions in FTCA cases indicate a general reluctance to hold a driver outside scope. This is true particularly when the United States is the sole source for paying a claim, as, for example, when the government driver or employee does not have POV or personal liability insurance or when such coverage is limited, the injuries are serious, and fair compensation would exceed the monetary limits of the personal insurance coverage. See FTCH § II, B3.

d. Experience indicates that a thorough and prompt investigation of a scope issue may result in a court finding that the Soldier or employee was not acting within the scope of employment. In doubtful cases, consider compromising the value of FTCA, MCA, or NGCA claims if the claimant rejects a chapter 5 settlement.

5-4. Claims partially payable

These are examples of claims that are partially payable:

a. Collision insurance covers the claimant's automobile, with a deductible amount of $250. While the claimant is sitting in the properly parked vehicle, it is struck from the rear by an Army truck driven by a DA civilian, who has misappropriated the truck. The claimant sustains personal injuries requiring hospitalization for six days and incurs, during that time, actual medical and hospital expenses amounting to $1,500. The claimant has no medical or hospitalization insurance. The damage to the vehicle amounts to $1,000. The insurance carrier reimburses the claimant $750 for the vehicle damage and becomes subrogated in that amount under the policy terms. The claimant files a claim in the amount of $1,500 for medical and hospital expenses. The claim is allowable in the total amount of $1,000, consisting of $250, the insurance deductible for property damage, and $750 of the medical and hospital expenses. The amounts claimed for medical and hospital expenses and for property damage constitute separable interests in a single claim that are not allowed in excess of $1,000 under this chapter. The claimant's insurer is not a proper party claimant, and no payment is allowable for the insurer's subrogated interest. The insurer must agree to the settlement.

b. Claimant holds an insurance policy authorizing reimbursement of up to $500 for the reasonable costs of medical and hospital expense incurred for personal injuries. While visiting an Army installation, the claimant is wounded when a Soldier who has stolen a government- issue 9-mm pistol negligently discharges it. The claimant is hospitalized at a civilian hospital and incurs medical and hospital expenses of $750. The claimant may be paid $250, the amount allowable for reasonable medical and hospital expenses actually incurred after deducting $500 legally recoverable under the insurance policy.

5-5. Settlement authority

The settlement authority will usually be the same official as the settlement authority for the original claim filed under the FTCA, MCA or NGCA as applicable. Any denial based on non scope, however, must first be considered under the NSCA. The applicable law is found in FTCH, § II, B3.

5-6. Reconsideration

Since a claim is not presented first under the NSCA, consider a request for reconsideration under the procedures that apply to the FTCA or, if it is not cognizable under the FTCA, as an appeal under the MCA or NGCA.

Chapter 6
National Guard Claims Act

6-1. Statutory authority

a. Following an explosion at a missile site in Middletown, New Jersey, Congress in 1960 enacted the National Guard Claims Act (NGCA), 32 U.S.C. § 715. At the time, one half of all Army missile sites were manned by the active Army and the other half by U.S. Army National Guard (ARNG) members employed in civilian technician status. The explosion occurred at an Army site and resulting claims were settled under the Military Claims Act (MCA). Because the MCA was intended not to cover claims arising out of the acts or omissions of state ARNG personnel serving in technician status under state control, Congress enacted a statute with language identical to that of the MCA, intending that it cover the acts of technicians performing federal missions as well as ARNG members serving in a federally funded training or duty status, under state control and on state-issued orders.

b. In 1968, all National Guard technicians were designated federal employees, 32 U.S.C. § 709. Because these employees perform both federal and state duties, the federal-state dichotomy affecting their status remains alive today. Additionally, a technician undergoing federally funded training is considered to hold the same status as any ARNG member on federally funded training or duty. ARNG personnel performing federally funded training duty under 32 U.S.C. §§ 316, 502, 503, 504, and 505 were subsumed into FTCA coverage on 29 December 1981 by amendment to 28 U.S.C. § 2671. This amendment sought to ensure that ARNG personnel were protected by the Driver's Act when subjected to individual suits, 28 U.S.C. § 2679.

6-2. Scope

a. The ARNG, as a community-based force, often performs work incident to full-time National Guard duty training (FTNGDT), or incident to duty training (IDT) in support of the local community and various private organizations. Such activities are authorized under a variety of statutes (such as 10 U.S.C. §§ 2012, 2558, and 32 U.S.C. § 508), a number of which apply to all the military components, not just the ARNG. Claims arising from the involvement of ARNG Soldiers in such statutorily sanctioned activities are within the scope of employment for purposes of the FTCA. The fact that such activities might also be performed in a state active duty status, with exclusively state claims liability, is irrelevant in processing claims arising from such activities conducted in a FTNGD or IDT status under the FTCA.

b. Because claims arising from the acts or omissions of both technicians and ARNG personnel on training or other federally-funded duty fall under the FTCA, the NGCA's scope differs from that of the MCA, even though pertinent language in the two statutes is identical. Both technicians and ARNG personnel performing training or other federally-funded training duty remain under state control. If a person in either category is performing a state mission or function, particularly at state installation armories, the investigation must determine where there is a direct benefit to the federal government. Each claim, particularly those arising at ARNG installations and armories, must be investigated with this difference in mind. See FTCH § II, B5b for applicable case law.

6-3. Claims payable

See chapter 3 of this publication.

6-4. Claims not payable

a. See the list of claims not payable set forth at AR 27-20, paragraph 3-4 , and the discussion at paragraph 3-4 of this publication.

b. Additionally, claims for damage to state-owned property caused by an ARNG member of that particular state are not payable.

c. Claims for injuries or death arising from the operation or administration of a state owned or leased ARNG camp or armory are not payable. Examples of such claims are a slip and fall injury due to a defective or improperly maintained surface and an injury from removing an explosive device from an impact area.

6-5. Applicable law

See chapter 3 of this publication.

6-6. Settlement authority

See chapter 3 of this publication.

6-7. Action on appeal

See chapter 3 of this publication.

Chapter 7
Status of Forces and Other International Agreements

Section I
General

7-1. Statutory authority

a. Treaties. In 1954, Congress enacted the International Agreements Claims Act (IACA), which authorizes payment of obligations under Treaties and other similar international agreements. The IACA is codified in two separate U.S. Code sections, 10 U.S.C. §§ 2734a and 2734b. The statute provides authority for payment of obligations arising under reciprocal claims provisions in treaties and other similar international agreements, but is not applicable to executive agreements. Section 2734a provides authority for the U.S. government to pay claims arising out of incidents within the U.S. caused by members of other forces. Section 2734b provides the authority for the U.S. government to reimburse foreign governments for the U.S. share of claims paid under an international reciprocal claims agreement. The North Atlantic Treaty Organization Status of Forces Agreement (NATO SOFA) is the first international agreement to which the IACA applied and in fact the IACA was enacted to provide for payment of obligations arising under the NATO SOFA. The NATO SOFA is supplemented by the 1996 Partnership for Peace Agreement, which extended the provisions of Article VIII to claims arising within its signatory States. The IACA also applies to other agreements. A current list of known agreements in force is maintained on the USARCS Web site at "Claims Resources," I, a, 8, (k). For further information contact the Foreign Torts Branch of USARCS.

b. Common terminology from applicable SOFAs.

(1) Contracting party and third party. SOFAs generally recognize two kinds of claimants:

(a) A member of the sending State forces may be a proper party claimant. However, under most SOFAs, members of the U.S. forces overseas and their family members are not proper party claimants.

(b) A third party is a person or entity, such as an individual, association, enterprise, organization, or even another nation, that is not a party to the SOFA. A political subdivision of a Party may be a third party.

(2) Force and civilian component. Many provisions of SOFAs apply to damages and injuries caused by members of a force or civilian component. These terms are usually defined in the SOFA as follows:

(a) "Force" means the personnel belonging to the land, sea, or air armed services of one Party, when situated in the territory of another Party in the North Atlantic Treaty area in connection with their official duties, provided that the two contracting parties concerned may agree that certain individuals, units, or formations shall not be regarded as constituting or included in a force for the purposes of the present agreement (NATO SOFA, Article I, para 1(a)). For example, agreements between the United States and other NATO countries further implementing the NATO SOFA often provide that attachés, Military Assistance Advisory Group (MAAG) personnel, or other personnel who enjoy diplomatic immunity are not considered members of the U.S. force. The German Supplemental Agreement to the NATO SOFA provides that service attachés, members of their staffs, and any other service personnel enjoying diplomatic or other special status in the Federal Republic of Germany (FRG) shall not be regarded as constituting or included in a force (T.I.A.S. No. 5351). However, other agreements differ from the German agreement. For example, agreements between the United States and Norway (T.I.A.S. No. 2950) and the United States and Denmark (T.I.A.S. No. 4002) provide that members of the U.S. MAAG will not be considered in a force. The latter agreements also exclude offshore procurement program personnel. U.S. Army regulations state that claims arising from the activities of MAAG personnel in foreign countries are not generally processed under the NATO SOFA or similar agreements but by U.S. authorities under the standard procedures for the administrative settlement of foreign claims, AR 1-75, chapter 6 . "Standard procedures" here refers to settlements under the Military Claims Act (MCA) or FCA (see AR 27-20, chaps 3 and 10 ).

(b) "Civilian component" means the civilians accompanying a force of a Party, who are employed by an armed service of that party, who are not stateless persons or nationals of any state that is not a party to the North Atlantic Treaty, and who are neither nationals of, nor ordinarily resident in, the state in which the force is located (NATO SOFA, Art. I, para 1(b)). Most U.S. citizen civilian employees of the U.S. armed services and their supporting nonappropriated fund (NAF) activities located in NATO countries may be classified as members of a civilian component. Most locally hired foreign employees of the U.S. armed services and their NAF activities do not qualify as members of a civilian component, however, because such persons ordinarily are nationals of, or resident in, the state in which the force is located. Dependents of members of a force or a civilian component are not members of a force or a civilian component unless they are employed by an armed service. Damages and injuries caused by dependents who do not qualify as members of the civilian component fall outside the claims provisions of the NATO SOFA.

(3) Sending State and receiving State. Two other terms are pertinent to the claims provisions of the NATO SOFA:

(a) "Sending State" is the Party whose force is situated in a foreign country, (NATO SOFA, Art. I, para 1(d)).

(b) "Receiving State" is the Party in whose territory the sending State force or civilian component is located, whether it is stationed there or passing in transit (NATO SOFA Art. I, para 1(e)).

c. Single-service responsibility. The Department of Defense (DOD) has assigned single-service responsibility for the investigation and settlement of claims including but not limited to countries in which a SOFA is in force. See Department of Defense Directive (DODI) 5515.08. A mailing address list for single-service claims offices is also on the USARCS Web site at VI, "Tables Listing Claims Offices Worldwide."

7-2. Scope of current agreements in force

a. Types of claims. Articles of SOFAs applicable to claims cover three types of claims:

(1) Intergovernmental claims by one Party against another Party; for example, NATO SOFA, Art. VIII, paragraphs 1 through 4.

(2) Claims by third parties for damages they sustain in a receiving State, that arise either out of the acts or omissions of members of a force or civilian component done in the performance of official duty or out of any other act, omission, or occurrence for which a force or civilian component is legally responsible. These are the "scope" claims falling under, for example, the NATO SOFA, Article VIII, paragraph 5.

(3) Claims by Parties or third parties, which, but for the Agreement's provisions, would be asserted against individual members of a force or civilian component, and which arise out of tortious acts or omissions in the receiving State done outside the performance of official duty. These are the "non-scope" claims falling under, for example, NATO SOFA, Article VIII, paragraph 6. These claims are processed under the Foreign Claims Act (FCA), see chapter 10 .

(4) Certain types of claims are expressly excluded from consideration under Article VIII. These include contractual claims based upon private contracts of members of the force or civilian component with third parties, for example, NATO SOFA, Art. VIII, para 5; and third-party claims of a maritime nature, for example, NATO SOFA, Art. VIII, paragraph 5(h). However, claims for death or personal injury arising from maritime operations that are not waived may be covered under the SOFA. In addition, certain claims of Parties against each other are waived either wholly or in part.

b. Discussion. The following is a discussion of each of the three types of Article VIII claims. The same analysis applies to the other applicable SOFAs.

(1) Intergovernmental claims. Paras 1 through 4 of Article VIII concern claims that one Party may bring against another Party. Of course, intergovernmental claims covered by Article VIII are limited to those exhibiting some connection with the North Atlantic Treaty implementation. International claims of one member nation against another member nation that do not arise from NATO-related activities are beyond Article VIII scope. Moreover, the scope of intergovernmental claims covered by Article VIII is rather narrowly defined, so some claims related to NATO operations, for example, contractual claims between parties (NATO SOFA, Art. VIII, paras 1 and 2) and war damage claims (NATO SOFA, Art. XV, para 1), do not necessarily fall within its terms. Intergovernmental claims are divided into four categories:

(a) Claims for damage to military property. Pursuant to Article VIII, para 1, each Party waives its claims for damage to property owned by it and used by its armed services when the damage is caused by a member or employee of the armed services of another Party in the execution of the latter Party's duties in connection with the operation of the North Atlantic Treaty. The waiver would apply, for example, when a receiving State vehicle is damaged in a collision with a sending State vehicle during a joint training exercise. The waiver also applies when the property damage is caused by the use of a vehicle, vessel, or aircraft owned by another Party and used by its armed services in connection with the North Atlantic Treaty. Further, even when the military vehicle, vessel, or aircraft that caused the damage is not being used in connection with North Atlantic Treaty operation, claims are waived (NATO SOFA, Art. VIII, para 1(ii)). For the waiver provisions to operate, the military property damaged or the military personnel or instrumentalities causing the damage must have some relationship with the North Atlantic Treaty operation. In practice, however, military property belonging to a NATO sending State located within a NATO receiving State is normally presumed to provide the needed NATO link.

(b) Claims for damage to nonmilitary property. Article VIII, para 2, provides for a waiver, in an amount of $1,400 or its equivalent, for damage to property owned by a Party but not used by that Party's armed services, NATO SOFA, Art. VIII, paragraph 2(f). DOD does not construe this waiver as establishing a "deductible" rule. If, for example, a vehicle belonging to a political subdivision of the Federal Republic of Germany is damaged in a collision with a U.S. forces vehicle while the U.S. vehicle is being operated in the scope of duty, the political subdivision claim will not be waived unless the damage sustained was less than $1,400. Liability for damage to nonmilitary national property in amounts in excess of $1,400 is apportioned between the Party responsible for the damage and the Party whose property is damaged in accordance with the formulas set out in Article VIII, paras 5(e)(i), (ii), and (iii). If the Parties are unable to resolve the issue of liability for damage to nonmilitary property by mutual agreement, the SOFA provides for arbitration procedure (NATO SOFA, Art. VIII, para 2(a)). Property owned by a Party's political subdivision is not property owned by the Party unless determined to be national property. If it is determined that the property of the political subdivision is not national property, the political subdivision may then be recognized as a proper third-party claimant under Article VIII, para 5.

(c) Maritime salvage claims. Article VIII, para 1, provides that claims for maritime salvage by one Party against another will be waived when the vessel or cargo salvaged is owned by another Party and used by its armed services in scope of duty. In addition to the usual concepts relied upon to establish ownership, a vessel is considered to be owned by a Party when the shipowner has leased it to the Party under bareboat charter (in a "bareboat charter" the Party taking the vessel under lease, the charterer, maintains sole possession, control, and management of the vessel), the Party has requisitioned the vessel on bareboat terms, or has seized it as a prize. A prize is a vessel belonging to a belligerent power, apprehended or forcibly captured at sea by a warship of the other belligerent, claimed as enemy property. Such a prize is therefore liable to appropriation and condemnation under the law of war. These concepts of vessel ownership (bareboat charter or seized prize) also apply to military vessels.

(d) Claims for injury to or death of a Soldier. Each Party to the NATO SOFA waives any claims it might have against other Parties for injury to or death of members of its armed services occurring while they are engaged in the performance of official duties (NATO SOFA, Art. VIII, para 4). However, the waiver does not extend to injuries to or deaths of civilian employees of the armed services of the Parties. It applies only to claims that one Party might assert against another and does not in any way affect a proper third-party claimant's right to assert a claim under Article VIII, para 5 or 6.

(2) Third-party scope claims. As stated in subparagraph 7-1b , a third party is an individual or entity that is not a Party to the NATO SOFA. A political subdivision of a Party is considered a third party, provided that it is established as an entity separate from the national government. Article VIII, para 5, sets forth procedures for settling and paying certain claims asserted by third parties for damages and injuries attributable to the duty-related acts, omissions or activities of Parties' visiting forces and civilian components while located in the territory of other Parties. A claim for damage or personal injury arising out of an act or omission of a member of a force or civilian component in the performance of official duties or under circumstances that would make the force otherwise "legally responsible" under the receiving State's law falls under NATO SOFA Art. VIII, para 5. An act, omission or occurrence for which a force or civilian component is legally responsible may include liability under the law of the receiving State based on absolute or strict liability. The term "legally responsible" is defined by local law and custom rather than by American concepts of tort liability. Third parties are the only claimants to whom Article VIII, paragraph 5, applies. In the Korean SOFA, Article V holds the U.S. harmless from claims by third parties arising from the U.S. use of installations in Korea.

(3) Non-scope claims. Non-scope claims fall under the FCA as discussed in chapter 10 of this publication.

c. Presentation of claims. NATO SOFA Article VIII, paragraph 5, provides that third-party claimants will file their claims in accordance with the laws and regulations of the receiving State as though the claim had arisen from activities of that State's own armed forces. Thus, a claim arising from U.S. Army activities in Germany would properly be presented to German authorities and not to the U.S. Army. The German authorities would then adjudicate the claim under German law. Receiving State authorities must designate offices where claims may be presented. While claims predicated upon a sending State's responsibility under the SOFA are properly filed with the receiving State's designated authorities, claimants may also seek redress from the individual tortfeasor by any means available under local law (NATO SOFA, Art. VIII, para 9). Both sending and receiving States must be alert to discover actions brought against individual tortfeasors so that the remedy provided by Article VIII may be substituted for direct action against the individual. Although possibly subject to personal judgment, a member of a force or civilian component is immune from proceedings for enforcement of any judgment against him or her as long as the claim arose out of the performance of official duties.

Section II
Claims Arising in the United States

7-3. Claims payable

See paragraphs 3-3 , 4-3 , and 8-4 of this publication.

7-4. Claims not payable

See paragraphs 3-4 , 4-4 , and 8-5 of this publication.

7-5. Notification of incidents

a. An area claims office (ACO) or claims processing office (CPO) that learns of an incident must report it to USARCS immediately. As USARCS is the receiving State office in the United States, this requirement applies to all uniformed services as well as to DOD. Puerto Rico and part of Hawaii do not fall under the NATO SOFA as they are south of the 20th parallel or Tropic of Cancer.

b. USARCS, as sole liaison to sending State representatives, should be informed of any local contact or inquiry such as one related to a joint maneuver by a member of the NATO SOFA force.

7-6. Investigation

Claims personnel will process claims arising from acts or omissions done in the performance of official duty by members of a foreign force or civilian component under the same provisions as those governing the acts or omissions of the U.S. armed services' Soldiers or civilian employees; responsibility and the manner of investigation are the same. Forward a mirror file to USARCS as required for claims arising under chapters 3 , 4 , and 8 , regardless of the amount claimed. See chapter 2, Sections I and II , Claims Investigative Responsibility and Filing and Receipt of Claims, respectively. The term "in the performance of official duty" is considered to be the same as "within scope of employment." USARCS will obtain a statement on whether the claim arose from the performance of official duties from the sending State.

7-7. Settlement authority

Settlement authority is not delegated to any ACO or CPO but is reserved for the Commander USARCS and higher authority as set forth in chapters 3, 4, or 8. DODI 5515.08 assigns USARCS single service responsibility for all SOFA claims arising within the United States.

7-8. Assistance to foreign forces

NATO SOFA, Article VIII, para 10, provides for mutual cooperation in the procuring of evidence. Claims personnel should provide sending State forces the same assistance and guidance as they do unit claims officers.

Section III
Claims in Foreign Countries

7-9. Claims procedures

See AR 27-20, paragraph 7-13 .

7-10. Responsibilities

See AR 27-20, paragraph 7-14

Chapter 8
Maritime Claims

Section I
General

8-1. Statutory authority

a. The Army Maritime Claims Settlement Act (AMCSA), Act of 29 November 1989, Pub. L. No. 101-189 , 10 U.S.C. §§ 4804, 4806, authorizes the Army to settle maritime tort and salvage claims for or against it. (See FTCH § II, B4f, for case law.)

(1) Upon its enactment on 10 August 1956, ch 1041, § 1, 70 Stat. 270, the AMCSA authorized the Army to settle claims in amounts up to $500,000 and required Congress to certify any payment in settlement above that amount. The present AMCSA retains the same requirement. When it was first enacted, the statute authorized the service Secretary to delegate only $1,000 in settlement authority. By amendment, Congress raised the level of delegable settlement authority to $10,000, Act of 29 August 1972, Pub. L. No. 92-415, and then to $100,000, the level presently in effect. Act of 29 November 1989, Pub. L. No. 101-189. Similar Acts conferred corresponding maritime claims settlement authority upon the Department of the Navy (10 U.S.C. § 7363 and §§ 7621-7623) and the Department of the Air Force (10 U.S.C. §§ 9801-9804 and § 9806).

(2) When first enacted, the AMCSA limited the Army's settlement authority to claims for damage caused by an Army vessel and for towing or salvage of an Army vessel. Subsequent amendments expanded settlement authority over any maritime tort committed by an Army agent or employee, 10 U.S.C. § 4802.

(3) The Army's settlement authority is not restricted to claims arising only within the United States or upon the high seas. Maritime claims arising within another country's territorial waters may be paid under either the AMCSA, the Military Claims Act (MCA) or the Foreign Claims Act (FCA). Normally, the AMCSA authority and procedures will be the primary basis for settlement of maritime claims arising in the territorial waters of other countries. See AR 27-20, paragraphs 3-3c and 10-2c .

(4) The AMCSA requires that affirmative maritime claims brought by the Army must fall "within the admiralty jurisdiction of the United States," unless the Army seeks compensation for damage caused by a vessel or floating object, 10 U.S.C. § 4803(a)(1). Therefore, if collection efforts fail, a foreign court is the only appropriate venue for a lawsuit, and the claim is not for damage caused by a vessel or floating object, the Army must report it to the Department of Justice (DOJ) for resolution.

(5) Unlike several other affirmative claims statutes, the AMCSA's provisions prohibit the Army from retaining the funds it recovers; the Army must remit these monies to the Financial Management Service (FMS) for deposit to the U.S. Treasury.

b. The Rivers and Harbors Act of 1899, 33 U.S.C. §§ 401-467n, specifically authorizes the U.S. Army Corps of Engineers (COE) to assert claims against shipowners and vessels causing damage to the COE's navigational structures, 33 U.S.C. §§ 408 and 412. This statute does not require a finding of fault for the imposition of liability and the Limitation of Shipowners Liability Act does not limit the shipowner's liability on these claims. Funds that the COE recovers this way are credited to the appropriation for the improvement of the waterway in which the damage occurred, 33 U.S.C. § 412.

c. The North Atlantic Treaty Organization Status of Forces Agreement (NATO SOFA) ( http://www.nato.int/docu/basictxt/b510619a.htm ) obligates the United States, as the receiving State, to adjudicate and pay any claim arising within the United States incident to the official duties of a member of a sending State force. Once the claim has been paid, the sending State reimburses the receiving State according to a formula set forth in the treaty. See NATO SOFA, Article VIII, and AR 27-20, chapter 7 . Under 10 U.S.C. § 2734a and § 2734b, the International Agreements Claims Act (IACA) that implements the NATO SOFA, the United States, as the receiving State, is responsible for settling maritime personal injury claims, but not maritime property damage claims, arising from the operation of any sending State's naval vessels in U.S. territorial waters. The corresponding settlement authority is set forth therein.

8-2. Related statutes

a. The AMCSA authorizes the Army to settle maritime claims but, unlike the FTCA, it does not expressly waive the United States' sovereign immunity from such claims. The primary statutory waivers of sovereign immunity allowing maritime claims against the United States are found in the Suits in Admiralty Act (SIAA), 46 U.S.C. §§ 30901-30918, and the Public Vessels Act (PVA), 46 U.S.C. §§ 31101-31113.

(1) Because both the SIAA and PVA were enacted before the FTCA, they are the exclusive remedies for maritime claims brought against the United States. The FTCA specifically bars claims falling within the federal maritime jurisdiction for which either the SIAA or the PVA provides a remedy, 28 U.S.C. § 2680(d).

(2) Upon its 1922 enactment, the SIAA waived sovereign immunity for maritime claims under circumstances similar to those in which the plaintiff could sue a private person. It covered claims arising from the operation of a vessel, but only one "employed as a merchant vessel." The PVA, enacted in 1925, authorized settlement of suits arising from the operation of other public vessels, such as warships. Notably, a 1960 amendment repealed the SIAA's "merchant vessel" restriction. Because the PVA was not repealed, however, the coverage that these two statutes provide overlaps.

(3) The SIAA permits payment of prejudgment interest but the PVA does not, except in certain contractual cases, 46 U.S.C. § 31107. An alien may sue under the PVA only if his or her country of origin permits U.S. citizens to bring suit in the alien's country of origin, 46 U.S.C. § 31111.

(4) Neither the SIAA, the PVA, nor the AMCSA requires claimants to file administrative claims with the Army before filing suit. Because the AMCSA authorizes the Army to settle such claims, however, claimants may elect to file them. Filing an administrative claim does not toll the two-year statute of limitations on suing the United States.

b. While it does not expressly waive sovereign immunity, the Admiralty Extension Act (AEA) affects the Army maritime claims process in important ways. It extends U.S. maritime jurisdiction to claims for property damage or personal injury caused by a vessel on navigable waters, even when the damage or injury occurs or is consummated on land. Before Congress enacted the AEA in 1948, these claims were not deemed maritime at all. The statute states that the SIAA and PVA are the exclusive remedies for any such claims against the United States. It further requires that a suit based on this extension may not be filed against the United States until six months after the claim has been presented in writing to the federal agency owning or operating the vessel. Unlike the FTCA, the AEA does not permit filing an administrative claim to toll the statute of limitations. Nevertheless, if an AMCSA claim is filed and settled under AEA jurisdiction, all action must be completed within the two-year statute of limitations. For example, on 1 January 2002 an AMCSA claim is filed for which the judicial remedy is under the AEA. The claim accrued on 1 February 2000. If payment action is not completed by 31 January 2002, suit under the AEA does not lie, as the six month period from the date of filing expires after the expiration of the two-year statute of limitations.

Section II
Claims Against the United States

8-3. Scope

It is important to recognize a maritime claim promptly. Generally, a claim falls within the federal maritime jurisdiction if it arises in or from a maritime location and involves some traditional maritime nexus or activity, Admiralty Jurisdiction: Maritime Nature of Tort, 80 A.L.R. Fed. 105.

a. Maritime location. Traditionally, U.S. maritime jurisdiction extended only to injuries or damage sustained on the high seas or on domestic waters that were navigable in fact in interstate or international commerce, even if an act on land caused the injury. "Maritime location" was critical-that is, did the incident occur on navigable waters? Case law defines "navigable waters" as any body of water or any waterway used or capable of being used for trade or travel between two states or between the United States and a foreign country. To determine a waterway's navigability, the courts look to both its current and historical uses. For example, if a dam is constructed across a waterway without a lock for sending boats upstream, the area above the dam will no longer lie within the maritime jurisdiction regardless of its historical uses. See, for example, Adams v. Montana Power Company, 528 F.2 d 437 (9th Cir. 1975). And a large reservoir straddling two states' boundaries may lie within the maritime jurisdiction even though the river above or below it does not. The traditional rule did not allow a suit in admiralty to lie if an act on navigable waters caused an injury on land. For example, a court would have dismissed a wharf owner's claim for damages caused by a vessel colliding with the wharf because the traditional rule considered wharves, piers, and jetties to be extensions of the land. The AEA changed that rule and made injury on land resulting from an act on navigable waters subject to a suit in admiralty.

b. Traditional maritime nexus or activity. In 1972, the Supreme Court appeared to narrow the scope of United States maritime jurisdiction when it held that a maritime location was not necessarily sufficient to confer maritime jurisdiction.

(1) In Executive Jet Aviation, Inc. v. City of Cleveland, 409 U.S. 249 (1972), a jet aircraft en route from Cleveland to New York lost power when its engines sucked in a flock of birds during takeoff. The jet descended suddenly and skidded down the runway through the airport fence, coming to rest about one fifth of a mile offshore in Lake Erie. There were no injuries to the crew, but the aircraft soon sank and became a total loss. The Supreme Court held that a maritime location was not sufficient to confer maritime jurisdiction in the case. Stating that the case at bar was "only fortuitously and incidentally connected to navigable waters" and bore "no relationship to traditional maritime activity," the Court saw no reason why Ohio tort law should not apply to the facts. The Justices noted that even if the wind or wave forces affecting the downed aircraft resemble those that a sinking ship might encounter, the plane's unexpected descent "will almost invariably have been attributable to a cause unrelated to the sea," and held that there must be both a maritime location and a connection to a traditional maritime activity. In general, recent federal court decisions interpret this principle to require some impact on commercial shipping or navigation.

(2) Following Executive Jet Aviation, many courts held that a traditional maritime activity must involve commerce. Therefore, accidents caused by pleasure boats were held not to fall within the federal maritime jurisdiction. Yet the Supreme Court subsequently held that many accidents involving pleasure boats and other vessels not engaged in traditional maritime commercial activity may give rise to a maritime claim. If the pleasure boat was in navigation or operated in the course of some activity that could disrupt maritime commerce, then the claim sounded in maritime jurisdiction, Foremost Insurance Co. v. Richardson, 457 U.S. 668 (1982); Sisson v. Ruby, 497 U.S. 358 (1990). The courts interpret this potential impact on navigation or commerce broadly. For example, the Sisson court found maritime jurisdiction where a fire destroyed a pleasure boat while it was moored to a marina dock.

(3) Aircraft crashes into navigable water typically will not give rise to maritime claims if the intended flight route is between two points within the continental United States. However, claims from airplane crashes in navigable waters may fall within the maritime jurisdiction if the intended flight route is to or from an offshore island or a drilling rig.

(4) Kelly v. Smith, 485 F.2 d 520 (5th Cir. 1973), a case involving someone on land who fired shots at poachers fleeing by boat across the Mississippi River, provides an excellent analytical framework. The court considered the parties' functions and roles, the types of vessels and instrumentalities involved, the causation and type of injury and the traditional concepts of maritime jurisdiction.

c. Applicable statute. Because the FTCA excludes maritime claims, such claims, even those arising within a state's territorial waters, are not adjudicated according to that state's law. Instead, general maritime law or special maritime statutes such as the Jones Act (46 U.S.C. §§ 30101-30106) or the Death on the High Seas Act (46 U.S.C. §§ 30301-30308) apply. These Acts' provisions and implementing regulations may differ from those of the various states' on such issues as the effect of the plaintiff's negligence or the type and amount of compensable damages. For example, general maritime law applies the pure comparative negligence rule and allows no recovery for loss of society, Miles v. Apex Marine Corp., 498 U.S. 19 (1990). Similarly, both the Jones Act and the Death on the High Seas Act limit wrongful death damages more narrowly than most state laws do.

(1) Maritime claims arising outside the United States are not within the scope of the Army' s single-service responsibility for tort claims.

(2) Property damage claims arising out of a ship's navigation or operation or the loading, discharge or carriage of cargo are not covered by host country adjudication provisions of the NATO SOFA and some other SOFAs. See NATO SOFA, Article VIII.

(3) Unlike FTCA claims payments over $2,500 and FCA or MCA claims payments over $100,000, none of the money paid to settle an administrative maritime claim is disbursed from the FMS Judgment Fund. Rather, the Army's claims appropriation funds the entire payment, up to the $500,000 limit of its authority, on an Army maritime claim. However, if the DOJ resolves a claim after a claimant files suit, the payment will be made from the Judgment Fund.

8-4. Claims payable

a. Every field claims office should ensure that all claims personnel who receive claims notify the area claims office (ACO) or the claims processing office (CPO) immediately about any claims that might be maritime in nature, whether or not they are labeled as such. See AR 27-20, paragraph 8-4 for a list of such incidents. Potential maritime claims include those involving:

(1) Damage to any type of ship, boat or watercraft, such as jet skis, canoes, or rafts, occurring on any body of water.

(2) Damages resulting from any Army aircraft caused by crashing into any body of water.

(3) Damage or injury sustained in or on any body of water, involving a boat or other watercraft.

(4) Damage or injury sustained on land or on water, allegedly due to the negligent operation of an Army-owned or -leased ship, boat or barge.

(5) Damage to any wharf, pier, jetty or other structure on or adjacent to any body of water.

(6) Any injury alleged to have occurred on board any Army vessel.

b. Upon receiving such claims, the ACO or CPO must determine whether the claim falls within the federal maritime jurisdiction. In most cases, this determination will be fairly easy to make, but there will be many times when the issue is in doubt. If that is the case, consult the area action officer (AAO) on the question of maritime jurisdiction immediately.

8-5. Claims not payable

See AR 27-20, paragraph 8-5 .

8-6. Limitation of settlement

a. A settled claim must be approved for payment by the appropriate settlement authority. Neither presentation of a claim nor the Army's consideration of it waives or extends the two-year statute of limitations. Claims personnel should so inform the claimant when the claim is received. A sample letter to the claimant is posted on the USARCS Web site at "Claims Resources," II, c, no. 6.. If the claimant files a civil action in a U.S. District Court before the end of the two-year statutory period, the Commander USARCS may negotiate an administrative settlement with the claimant, even though the two-year period has elapsed since the cause of action accrued, provided the claimant obtains the written consent of the appropriate DOJ office charged with defending the complaint. The claimant must agree to dismiss a timely filed suit as part of any settlement. Payment may be made upon dismissal of the complaint.

b. Upon receiving a maritime claim under this section, a notice of damage, invitation to a damage survey, or other written document indicating an intention to hold the United States liable, the ACO or CPO will immediately forward such document to the Commander USARCS. The ACO or CPO receiving notice of the claim will promptly advise the claimant or potential claimant in writing of the statute of limitations comprehensive application.

c. When a maritime claim is presented to an ACO or a CPO and action on the claim by that office may be appropriate pursuant to the delegation of authority set forth in AR 27-20, paras 8-8 and 8-11 , that office will promptly advise the claimant in writing of the time limitation on the Army's authority to settle the claim as well as of the fact that filing the claim does not toll the statute of limitations.

d. If the injury or damage giving rise to the claim is sustained on or in navigable waters, claimants are not required to file an administrative claim before filing suit. However, an administrative claim must be filed before a civil suit in cases where maritime jurisdiction is based on the AEA (such as damage or injury on land resulting from an act on navigable waters, see para 8-3 ). Even in those cases, however, the filing of an administrative claim neither tolls the two-year statute of limitations nor extends the Army's authority to settle a claim. Claims personnel should bring any such claim filed within six months of the running of the statute of limitations to USARCS' attention immediately and make every reasonable effort to complete final agency action before the statute of limitations expires.

8-7. Limitation of liability

a. Limitation of liability under the Limitation of Shipowners' Liability Act, 46 U.S.C. §§ 30501-30512, applies to all vessels, whether seagoing or used on lakes and rivers for inland navigation, such as canal boats, barges, and lighters, 46 U.S.C. § 30502. This Act covers pleasure craft as well. The statute limits liability to the amount or value of the owner's interest in the vessel and her freight, 46 U.S.C. § 30505. If the vessel is wrecked or sunk, the District Court determines its value.

b. If a maritime claim involves an Army vessel, the United States may limit its liability to the value of that vessel after the accident, if the DOJ files a special limitation action within six months of receipt of the claim. This means that the ACO or CPO must notify the AAO of such claims within 10 days of receipt.

8-8. Settlement authority

See AR 27-20, paragraph 8-8.

Section III
Claims in Favor of the United States

8-9. Scope

a. The Army may pursue affirmative claims for property damage, including damage caused by a vessel to an Army structure on land. Usually, such incidents involve vessels striking a lock, dock or other structure under the Army's control. Usually such claims are processed under the Rivers and Harbors Act as indicated in paragraph 8-1b . Such claims may involve determining whether the vessel was properly moored during a severe storm. Process them as a normal claim, and send a mirror copy to USARCS if the potential recovery exceeds the field office's authority.

b. The U.S. Army Corps of Engineers (COE) is responsible for wreck removal, 33 U.S.C. §§ 403, 406, 409, 414 and 415. These authorities impose on the shipowner the duty to mark the wreck with a buoy and commence its removal immediately, regardless of whether the wreck was caused by an accident or otherwise and whether the wreck is located in a channel. Where the maintenance of a navigation channel is involved, the Army may raise and remove the wreck at the expense of the owner or the person who negligently sank the vessel, 33 U.S.C. § 414. The COE may mark and remove the wreck at the owner's request and expense, 33 U.S.C. § 409.

c. This list is neither definitive nor all-inclusive. For calculation of damages, including overhead, see chapter 2, Section VI , Determination of damages.

8-10. Civil works claims

The COE has authority to recover compensation for certain types of damage, such as to a lock, dam or other structure on land. However, where such recovery effort fails, the COE should process the affirmative claim under the AMCSA and forward it to USARCS together with a memorandum as set forth in paragraph 2-60 . USARCS will determine whether further demand is indicated. If suit by the United States is indicated, the Commander USARCS will forward the claim to the Admiralty Section, DOJ, with a memorandum explaining past recovery efforts, and an opinion stating why those efforts did not succeed.

8-11. Settlement authority

See AR 27-20, paragraph 8-8 .

8-12. Demands

See AR 27-20, paragraph 8-12 .

Chapter 9
Article 139, Uniform Code of Military Justice

9-1. Statutory authority

Article 139 of the Uniform Code of Military Justice (UCMJ) , entitled "Redress of Injuries to Property" (10 U.S.C. §939) states that:

a. Whenever complaint is made to any commanding officer that willful damage has been done to the property of any person or that a person's property has been wrongfully taken by members of the armed forces, he may, under such regulations as the Secretary concerned may prescribe, convene a board to investigate the complaint. The board shall consist of one to three commissioned officers and, for the purpose of that investigation, it has power to summon witnesses and examine them upon oath, to receive depositions or other documentary evidence, and to assess the damages sustained against the responsible parties. The assessment of damages made by the board is subject to the approval of the commanding officer, and in the amount approved by him shall be charged against the pay of the offenders. The order of the commanding officer directing charges herein authorized is conclusive on any disbursing officer for the payment by him to the injured parties of the damages as assessed and approved.

b. If the offenders cannot be ascertained, but the organization or detachment to which they belong is known, charges totaling the amount of damages assessed and approved may be made in such proportion as may be considered just upon the individual members thereof who are shown to have been present at the scene at the time the damages complained of were inflicted, as determined by the approved findings of the board.

9-2. Purpose

a. Scope. Article 139, UCMJ, provides an administrative mechanism for assessing and paying restitution to the victims of certain types of criminal offenses committed by military personnel subject to the UCMJ (see para 9-5 ). Victims of these offenses often have no other adequate means of obtaining restitution. Article 139 ensures that a victim is compensated directly from the wrongdoer's military pay rather than from the United States Treasury. This serves both to implement the goals embodied in the Victim and Witness Protection Act of 1982 and to promote military discipline and protect the civilian or military community from these types of disorders. Article 139 provides, however, an extraordinary administrative claims settlement authority. In essence, commanders are granted special powers normally reserved to the civil judicial authority. This authority must not be expanded beyond its strict limits; doing so could raise serious constitutional issues.

b. Historical background. Throughout its history, Article 139 has provided redress for the offenses of wasting, spoiling, or destroying nonmilitary property, presently proscribed by Article 109, UCMJ. Because disorderly Soldiers often commit acts of depredation in groups, the Article contains a unique provision allowing a commander to levy against the pay of all members of a unit who were present when damages were inflicted if an individual offender cannot be identified.

9-3. Proper claimants

a. AR 27-20, paragraph 9-3 lists the categories of proper claimants under Article 139.

b. Essentially, any person, business, organization, or other legally recognized entity is a proper claimant. Only the United States and its nonappropriated fund instrumentalities (NAFIs) are ineligible.

9-4. Effect of disciplinary action, voluntary restitution, or contributory negligence

a. Disciplinary action. Disciplinary action taken against an offender is entirely separate from action taken under Article 139. Under no circumstances should the approval authority or anyone acting for, or appointed by, the approval authority to act on the claim delay action under Article 139 pending resolution of disciplinary action. Because different evidence is admissible and a different standard of proof is applied, acquittal on the charges underlying an Article 139 claim is not in itself a basis for dismissal of the claim or for modification on reconsideration. Action under Article 139 requires an independent inquiry. Furthermore, once disciplinary action is imposed, the claimant may be left with no effective remedy due to the discharge, reduction in rank or forfeitures of pay of the Soldier responsible.

b. Voluntary restitution. The approval authority may terminate Article 139 proceedings without findings if the Soldier voluntarily makes full restitution to the claimant. Any amount paid to the claimant as partial restitution will be deducted from the amount assessed.

c. Contributory negligence. Because an Article 139 claim is founded upon a criminal act, a claim otherwise cognizable and meritorious is payable whether or not the claimant was negligent.

9-5. Claims cognizable

a. Persons against whom claim is cognizable. Article 139 provides compensation only for loss of, or damage to, real or personal property that has been willfully damaged or wrongfully taken by a member of the U.S. armed forces, to include active duty personnel, retired personnel against whom an Article 139 claim was brought while the offender was still serving on active duty, and Reserve and National Guard personnel when their status subjects them to the UCMJ .

b. Willful damage. Willful damage falls into two categories. The first category involves damage caused intentionally without justification. Such damage is essentially the result of vandalism. The second category involves riotous, violent, or disorderly acts, acts of depredation or acts showing a reckless and wanton disregard for the property rights of others. Loss or damage caused thoughtlessly or inadvertently by a Soldier's negligent conduct is not covered.

(1) A claim that a Soldier accidentally broke a lamp during a drunken brawl is cognizable. Even though the Soldier did not intend to break the lamp and the breaking alone may be construed as simple negligence, the Soldier's conduct shows a reckless and wanton disregard for the property rights of others.

(2) Claims involving damage resulting from the operation of a motor vehicle must be carefully examined. While in most situations such damage is the result of conduct that is merely negligent, and hence not cognizable, in some circumstances the conduct of the operator may be so extreme as to constitute reckless and wanton disregard for the property rights of others. Examples are operating a vehicle at an extreme rate of speed (such as driving at 90 miles per hour in a 45 miles per hour zone), or in an extremely high state of intoxication (such as driving with a Blood Alcohol Content of .25, where the legal limit is .08). However, a mere statutory violation, such as exceeding the speed limit by 5 miles per hour, or driving with a blood alcohol content of .10, is not sufficient by itself to give rise to liability under Article 139.

c. Wrongful takings. A wrongful taking is essentially a theft, that is, an unauthorized taking or withholding of property with the intent to deprive the owner of either temporary or permanent possession. Claims for property taken through larceny, forgery, embezzlement, misappropriation, fraud or similar conduct are normally cognizable. Takings that involve a dispute over the conduct of a Soldier acting as the claimant's agent, over the terms of a contract or over ownership of property are not cognizable unless the dispute is merely a cloak for an intent to steal. Article 139 is not a mechanism for the collection of debts, and the Army has no interest in mediating business disputes under the guise of preventing theft.

(1) A claim that a Soldier borrowed a DVD player and did not return it on the promised date is not cognizable unless the Soldier borrowed the DVD player as a pretext and sold it or kept it permanently. This is evidence of an intent to steal.

(2) A claim that a Soldier issued a worthless check and received property in return is cognizable if evidence establishes an intent to defraud. Such intent may be inferred when the Soldier fails to make good on a bad check within a reasonable time after receiving notice of insufficient funds.

(3) A claim that a Soldier stole a check or credit card and used it to obtain items of value is cognizable.

d. Definition of property. Article 139 provides a remedy for "property" willfully damaged or wrongfully taken (see para 9-1 ). It does not provide a remedy for all types of financial losses (such as theft of services, see subpara 9-6f ). Nevertheless the definition of property covered under Article 139 (see AR 27-20, para 9-5d ) is broader than the definition of property under the Personnel Claims Act and AR 27-20, chapter 11 .

9-6. Claims not cognizable

a. Negligence. Article 139 may not be used to hold a Soldier liable for negligent acts. Negligence is the failure to use the degree of care that a reasonably prudent person would use under the same or similar circumstances. Negligent conduct differs from conduct in which a Soldier clearly sees or should see that his or her actions are likely to cause damage to property but willfully disregards that risk and causes property damage. For example, if a Soldier accidentally breaks a dish in a china shop, that Soldier may not be held liable under Article 139 unless additional facts prove that the act was willful.

b. Personal injuries or wrongful death. Article 139 is designed to compensate victims only for loss of or damage to property. Hence, claims for personal injury and wrongful death are not cognizable and are treated elsewhere.

c. Scope of employment. Soldiers may not be held liable under Article 139 for acts or omissions which are made within the scope of their employment. This includes combat activities and noncombat activities, as defined in the Glossary of AR 27-20 . For example, a Soldier who drives a tank through a field during an exercise is not liable under Article 139 for damage to the crops in that field, even though his actions were intentional and he recognized that it was highly likely that the crops would be damaged. Even if the Soldier's acts are later determined to be reckless or otherwise wrongful, he cannot be held personally liable under Article 139, although the government may be held liable to the property owner under other provisions of law.

d. Reserve and National Guard personnel. Claims resulting from the conduct of Reserve component personnel who were not in a Title 10 duty status at the time of the conduct are not cognizable under Article 139.

e. Subrogated (third-party) claims. Subrogated claims are those in which a third party, such as an insurance company, asserts the claimant's rights. Article 139 will not be used to pay subrogated claims, including those brought by insurers. However, an insurance company may be a proper claimant if its property has been willfully damaged or wrongfully taken. For example, when an insurance company has made a settlement payment to a Soldier who has filed a fraudulent insurance claim, the company is a proper party claimant.

f. Theft of services. Because the language of Article 139 provides a remedy only for "property" willfully damaged or wrongfully taken, other types of financial losses are not cognizable, even if the conduct of the Soldier causing the loss is a violation of the UCMJ . The most common example of this is theft of services in violation of Article 134. For example, a claimant alleges that a Soldier houseguest has used the telephone and incurred long distance charges without permission. This is not cognizable because no property has been taken, even though the unauthorized use of the telephone services results in a financial loss.

g. Claims for indirect, remote, or consequential damages. Consequential damages flow indirectly from the wrongful act. They differ from direct damages. Article 139 may be used to recover only direct damages from the wrongdoer. There is no bright line test for distinguishing direct damages from indirect, remote or consequential damages.

(1) The costs of telephone calls, mileage, postage, copies, or attorneys' fees incurred to pursue a claim under Article 139 are consequential damages and are not compensable.

(2) Where expenses are necessary to repair a damaged item, such as the cost of moving it to a repair shop (drayage), such costs directly result from the Soldier's willful damage and are compensable as direct damages.

(3) The cost of a rental car may be considered direct, compensable damage when a Soldier steals or willfully damages a claimant' s privately-owned vehicle (POV). Such costs, such as rental of a vehicle comparable in value to the claimant's POV, must be reasonable.

h. Claims by persons or entities in conflict with or hostile to the United States. While in most circumstances damage to the property of such persons or entities would occur as a result of acts done by Soldiers within the scope of their duties, and thus be non-cognizable pursuant to subpara 9-6c , this section makes it clear that claims by such persons or entities are not cognizable regardless of the circumstances under which their property damage or loss may have occurred.

9-7. Limitations on assessments

Limitations on the amount of money that may be paid to a claimant depend on the level of authority at which the claim is handled. The Special Court-Martial Convening Authority (SPCMCA) with jurisdiction over the claim may approve any claim for a single incident up to $5,000 per claimant. The General Court-Martial Convening Authority (GCMCA) or designee may approve any claim up to $10,000. Only the Judge Advocate General (TJAG), the Deputy Judge Advocate General (DJAG) and the Commander USARCS, or designee may approve claims for more than $10,000. Pursuant to Rule for Court-M artial 1107, a convening authority who approves an Article 139 claim may be disqualified from taking final action in a court martial that arises out of the same incident. Consequently, if the judge advocate or head of the area claims office (usually the staff judge advocate (SJA)) advising the convening authority determines that the convening authority will be required to take final action in a court-martial arising out of the same incident as the Article 139 claim, the convening authority should forward the claim to the next higher level for action or approval. If the SPCMCA forwards the claim to the GCMCA for this reason before an investigation pursuant to AR 15-6 has been conducted, the GCMCA must appoint an investigating officer (IO) and follow the other procedures set forth in para 9-8 . See para 9-8g and para 9-8h(2) for application of Rule for Courts-Martial (RCM) 1107.

9-8. Procedure

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 good cause for the delay is shown. The SPCMCA acting on the claim determines what constitutes good cause. Generally, a person who is not aware of Article 139 or does not know the identity of the offender has good cause for delay in submitting a claim.

b. Form of a claim. A claim may be submitted orally, but it must be reduced to writing and signed by the claimant within ten calendar days. Anyone with knowledge of the Article 139 process should encourage the claimant to do this promptly. An oral claim that is not reduced to writing within ten calendar days may be dismissed. The claim must also seek a definite amount. An amount stated in a foreign currency must be converted to U.S. dollars. The claims judge advocate (CJA) or claims attorney should encourage claimants to use the language and format of the sample claim letter posted on the USARCS Web site at "Claims Resources," V, a, but claimants are not required to do so.

c. Action on receipt of a claim. Any Army officer who receives an Article 139 complaint must forward it to the SPCMCA having UCMJ jurisdiction over the alleged offender or offenders within two working days. The SPCMCA is a commander authorized to convene a special court-martial under the UCMJ and Army regulations, including commanders of units in reserve components, regardless of whether the exercise of such jurisdiction has been withheld. Special rules apply if more than one SPCMCA may have authority over the alleged offender or offenders or if the claim is against a member of another military service. If all SPCMCAs who have potential jurisdiction over the alleged offender or offenders fall under the command of a single GCMCA, the CJA or claims attorney should forward the claim to that GCMCA, who will designate one of the SPCMCAs to process the claim. If the SPCMCAs who have potential jurisdiction fall under the command of different GCMCAs, then the SPCMCA whose headquarters is closest to the place where the incident giving rise to the claim occurred has jurisdiction. Finally, if the claim is brought against a member of one of the other military services, then it should be forwarded to the commander of the nearest command of that military service equivalent to a major Army command (MACOM).

d. Initial action by the SPCMCA. If the claim appears cognizable, the SPCMCA will appoint an IO (see sample appointment letter posted to the USARCS Web site at "Claims Resources," V, b) to conduct an investigation using the informal procedures of AR 27-20, chapter 9 , and AR 15-6, chapter 4 , within four working days of receiving the claim. If the claim does not appear cognizable, the SPCMCA may refer it for legal review within four days of receipt. If after legal review the SPCMCA determines that the claim is not cognizable, they may disapprove the claim without appointing an IO.

e. Expediting payment through Personnel Claims Act and Foreign Claims Act procedures. There are times when a delayed payment may result in hardship to a claimant. If the Article 139 claim resolution will be unduly delayed, the area claims office may process the claim under the Personnel Claims Act (PCA), 31 U.S.C. § 3721, pursuant to AR 27-20, chapter 11 , or under the Foreign Claims Act (FCA), 10 U.S.C. § 2734, pursuant to AR 27-20, chapter 10 , if it is otherwise cognizable under that authority. If claims personnel handle the claim under chapter 11 or chapter 10, then the claims office must inform the claimant of the responsibility to repay to the government any overpayment should the Article 139 claim later succeed. Payment of an Article 139 claim under chapters 11 or 10 or should be approved only when necessary to prevent financial hardship to the claimant, not merely to avoid an inconvenience.

f. Action by the IO. Within ten working days of appointment, the IO will complete a claims investigation. The SPCMCA may extend this ten-day period for good cause. The CJA or claims attorney should advise the IO before the investigation begins on the scope of the investigation, procedural steps to follow and restrictions on evidence. The IO will promptly notify the Soldier against whom the claim has been brought (see the sample letter posted to the USARCS Web site at "Claims Resources," V, c. In addition, the IO will submit findings of fact and a recommendation based on those findings to the SPCMCA through the claims office and will provide the Soldier against whom the claim is brought with a copy of such findings and recommendations so the Soldier has an opportunity to respond. The IO should contact the CJA or claims attorney for guidance on legal and procedural questions.

(1) Generally. The IO should interview all available witnesses and obtain copies of police reports and other relevant documents. Evidence need not be in the form of sworn statements nor need it be admissible under the rules of evidence applicable in a court of law (see AR 15-6, para 3-6 ). For example, the IO may accept unsworn statements or consider hearsay evidence. When taking oral evidence in person or over the telephone, the IO should contemporaneously summarize the substance of the conversation in a memorandum for record. The IO should physically inspect all damaged items claimed and record findings in the same memorandum.

(2) Restrictions on evidence. Although the standards of evidence that apply to this administrative procedure are flexible and permissive, there are some restrictions on the questions that the IO may ask and the evidence that the he or she may use. The IO should consult the CJA or claims attorney before asking a witness or suspected offender any question that may be impermissible. When interviewing a Soldier suspected of an offense, the IO must warn the suspect of his or her rights against self-incrimination under Article 31, UCMJ . The IO should use DA 3881 (Rights Warning Procedure/Waiver Certificate) for this purpose. He or she should not consider any evidence specifically prohibited from consideration, listed in AR 15-6, paragraph 3-6.

(3) Standard of proof. A preponderance of the evidence is necessary for a finding of pecuniary liability under Article 139. This means that, to recommend liability, the IO must conclude that it is more likely than not that the claim is valid. The IO should base this judgment on the weight of the admissible evidence gathered during the investigation.

(4) Valuation of a claimant's loss. Normally, the measure of a loss is either the repair cost or the depreciated replacement cost for the same or a similar item. Most items depreciate at rates that depend on their age and condition. The Military Allowance List-Depreciation Guide (ALDG) may (but is not required to) be used to determine depreciated replacement cost.

(5) Findings and recommendation. The IO should submit findings and recommendation to the SPCMCA on DA Form1574 (Report of Proceedings by Investigating Officer/Board of Officers) and will address each of the following conditions for payment:

(a) Whether the claim is brought by a proper claimant, in writing, and seeks a definite sum.

(b) Whether the claim is brought within 90 days of the incident that gave rise to it, or the claimant has shown good cause for the delay.

(c) Whether the claim seeks compensation for property belonging to the claimant that was wrongfully taken or willfully damaged by a member or members of the U.S. Army.

(d) Whether the claim is meritorious in a specific amount.

(6) Claims against more than one Soldier. If the claim is brought against more than one Soldier, the IO will make a determination with respect to each named Soldier. Several Soldiers may be present when property is wrongfully taken or willfully damaged. If the IO determines that one or more of them committed the act but cannot determine who, the IO may recommend that equal amounts be assessed against each Soldier who was present. If a Soldier is in a no pay due status, the Defense Accounting officer will notify the approval authority.

(7) Processing claims against Soldiers absent without leave. If a Soldier found liable pursuant to Article 139 is absent without leave (AWOL), and thus cannot be notified of the impending assessment, then the approval authority may act on the claim in the Soldier's absence. If the claim against the AWOL Soldier is approved, the approval authority will ensure that a copy of the claim and a memorandum authorizing a pay assessment against the Soldier is transmitted to the servicing Defense Accounting Office (DAO) to process an offset against the Soldier's pay account.

g. Legal review by the CJA or claims attorney. Within five working days (which the SPCMCA may extend for good cause), the CJA or claims attorney will review the IO's findings and recommendation, and will consider whether or not action by the SPCMCA on the claim would interfere with the SPCMCA's obligations under RCM 1107. The SPCMCA should not take action on the claim if the SPCMCA will be required to take final action on a court martial of the Soldier against whom the claim was filed for offenses arising from the incident which is the subject of the claim. If not, the CJA or claims attorney will advise the SPCMCA whether the findings and recommendations are legally sufficient and supported by the evidence. See the sample review letter posted to the USARCS Web site at "Claims Resources." V, d. If they are not, the CJA or claims attorney will return the claim to the IO for additional findings. The CJA or claims attorney may review the findings and recommendation even after providing earlier legal or procedural advice to the IO. The CJA or claims attorney will prepare letters to the claimant and to the Soldier against whom the claim is brought for signature by the SPCMCA. Samples of letters to the wrongdoer and to the claimant are posted to the USARCS Web site at "Claims Resources," V, e and f. If the claim is legally sufficient, and the SPCMA determines that the claim should be approved in an amount of $5,000 or less, the CJA or claims attorney will prepare an action for the SPCMCA's signature, directing the appropriate DAO to withhold pay from the Soldier for disbursement to the claimant. A sample disbursement request letter is posted on the USARCS web site at "Claims Resources," V, g.

h. Final action by the convening authority.

(1) Action at the SPCMCA level. The SPCMCA may disapprove the claim regardless of the amount or, if the findings and recommendation are legally sufficient, approve it in an amount equal to or less than $5,000. The SPCMCA will notify both the Soldier and claimant(s) in writing of the decision and of their right to request reconsideration. The SPCMCA will then delay final action on the claim(s) for ten working days pending receipt of a request for reconsideration unless this delay will result in an injustice (such as the discharge of the liable Soldier from active duty and thus the Army's inability to disburse funds by pay assessment). If either party requests reconsideration within that time, the SPCMCA shall reconsider the claim within five days. If the SPCMCA approves a claim against a Soldier subject to his or her jurisdiction, the SPCMCA will direct the appropriate DAO to withhold pay from that Soldier in an amount up to $5,000 per claim and to pay that sum to the claimant. The SPCMCA should then return the claim file to the claims office for disposition.

(a) Soldiers not subject to the SPCMCA's jurisdiction. For Soldiers not subject to the SPCMCA's jurisdiction, the SPCMCA will forward a copy of the claim to the SPCMCA who does exercise jurisdiction. This SPCMCA is bound by the determination made by the first SPCMCA and will direct the appropriate DAO to withhold pay from that Soldier in an amount up to $5,000 and pay it to the claimant.

(b) Forwarding claims to the GCMCA.. If the SPCMCA determines that an assessment in excess of $5,000 per claimant is warranted, or if action by the SPCMCA on the claim would interfere with the SPCMCA's obligations under RCM 1107, the CJA or claims attorney will forward the file to the head of the area claims office. In most cases, the head of the area claims office will also be the GCMCA's SJA.

(2) Action at the GCMCA level. Within five working days of receipt of the claim, the head of the area claims office will review the claim for legal sufficiency and determine whether or not action by the GCMCA on the claim would interfere with the GCMCA's obligations under RCM 1107. The GCMCA should not take action on the claim if the GCMCA will be required to take final action on the court-martial of the Soldier against whom the claim was filed for offenses arising from the incident which is the subject matter of the claim. If the head of the area claims office (usually the GCMCA's SJA) determines such a conflict exists, that officer, on the GCMCA's behalf, will forward the claim with an explanation of the problem to the Commander USARCS for final review. (See AR 27-20, subpara 9-7a(2)(b) ). If there is no conflict of interest under RCM 1107, the GCMCA shall disapprove or approve the claim in an amount up to $10,000 per claimant, within five working days. The GCMCA will notify the Soldier and the claimant in writing of the decision and of their right to request reconsideration. The GCMCA will postpone final action for ten working days to allow either party to request reconsideration. If a request is received within that time, the GCMCA has five working days from the date of receipt to reconsider the claim. If the GCMCA decides to approve the claim in whole or in part, he or she will then take final action by directing the appropriate DAO to withhold an amount up to $10,000 per claimant from the Soldier's pay. If the GCMCA determines that the claimant is entitled to an amount in excess of $10,000, then the GCMCA will approve the claim for $10,000 and forward the claim, along with his or her recommendation, to the Commander USARCS for final action. If, as a result of reconsideration, the GCMCA disapproves the claim the GCMCA will take final action by notifying the parties in writing of the decision.

(3) Final action by USARCS. If the Commander USARCS, or a designee, determines that a claim in excess of $10,000 should be approved, he or she will send a memorandum to the GCMCA approving a cumulative assessment in an amount over $10,000 and authorizing the appropriate DAO to withhold additional monies from the offending Soldier's pay and to make restitution to the victim.

i. Assessment. Upon receipt of the Article 139 assessment, the appropriate DAO will withhold the amount directed by the approval authority. The assessment is binding on the DAO. It is not subject to appeal. However, the assessment is subject to the limitations set forth in regulations governing military personnel pay administration. If the DAO to whom the assessment is directed cannot withhold the Soldier's pay because it does not have the Soldier's pay record or the Soldier is in a no-pay-due status, it must promptly notify the approval authority in writing.

j. Post-settlement action. After action on the claim is completed, the servicing claims office will retain the original claim file and forward a complete copy to the SPCMCA. The claim file will be filed locally, per AR 25-400-2 . If a personnel claim is filed for the same incident under AR 27-20, chapter 11 , the claims office will incorporate a copy of the Article 139 claim into the chapter 11 claim file.

k. Remission of indebtedness. By statute and regulation, an enlisted Soldier is entitled to seek remission of a debt which is owed to the U.S. government. In an Article 139 claim, the debt is owed to the Soldier's victim, not to the United States; therefore, remission of indebtedness procedures do not apply to Article 139 claims. A Soldier may not be relieved of a financial obligation arising under Article 139 through the remission of indebtedness process.

9-9. Reconsideration

Upon receiving a request for reconsideration from either the claimant or a Soldier who has been assessed pecuniary liability, the approval authority or successor in command will direct the legal advisor to provide a recommendation. If the request raises an issue of fact, the approval authority may appoint an IO to make further findings of fact. If the approval authority contemplates modifying the decision, he or she shall provide all parties to the claim with notice and an opportunity to respond. The approval authority will record the basis upon which the decision is modified and notify all parties.

a. Action by the original approval authority. The approval authority should not modify a decision on a request submitted more than ten days after the original decision was issued except on the basis of newly discovered evidence, fraud, or obvious error of fact or law.

b. Action by a successor in command. A successor in command to the original approval authority may not modify a decision on any request except on the basis of newly discovered evidence, fraud, or error of fact or law apparent from the file.

c. Disposition of files. The approval authority will ensure that a copy of the reconsideration is filed with the claim.

9-10. Additional claims judge advocate and claims attorney responsibilities

In addition to conducting legal review of Article 139 claims, the CJA or claims attorney is responsible for:

a. Forwarding copies of completed actions to USARCS. Within ten working days of final action on the claim, the CJA or claims attorney will prepare a cover sheet for the claim and forward it, along with a copy of the claim, to the Commander USARCS, ATTN: JACS-PC. The cover sheet will state the claimant's name, the offender's name, the convening authority, the amount of the assessment, the date approved or disapproved and, if applicable, whether an additional assessment by USARCS is recommended. The CJA or claims attorney must also state whether DAO action was completed if pecuniary liability was recommended.

b. Monitoring time requirements. The CJA or claims attorney will maintain an Article 139 log and monitor time requirements ("suspenses") on pending Article 139 claims, acting to ensure that they are met. Timely completion of Article 139 actions is essential since delays may prevent proper assessment against an offender's pay account. If the offender is separated from active duty it may be impossible to collect anything from his or her pay account. If the offender is tried by court-martial any resulting forfeitures may also preclude proper assessments.

c. Publicizing the Article 139 program. The CJA or claims attorney has a duty to publicize the Article 139 program to commanders, Soldiers and the general public. Methods of disseminating Article 139 information include publishing articles, ensuring that attorneys involved in legal assistance and military justice know about the Article 139 process so they can advise victims, and teaching Article 139 procedures in Army legal classes.

Chapter 10
Foreign Claims Act

Section I
General

10-1. Statutory authority

a. The Foreign Claims Act (FCA) (10 U.S.C. § 2734) was enacted on 2 January 1942, retroactive to 27 May 1941, the date on which President Roosevelt proclaimed that the threat of a German advance in western Europe constituted a national emergency for the United States. The FCA was designed to engender good will and promote friendly relations between the U.S. armed forces and host countries. On 7 July 1941, after the government of Iceland formally invited the U.S. Marine Corps to that nation, the Secretary of the Navy urged Congress to enact the FCA to provide coverage for claims resulting from the Marines' presence in Iceland. Originally, the FCA was intended to remain in effect only during the national emergency; by various amendments, however, Congress continued it in force until 1956, when the FCA entered into permanent law. Act of 28 July 1956, Ch. 769, 70 Stat. 703.

b. Upon its enactment, the FCA authorized compensation only to a friendly inhabitant of a friendly foreign country filing a claim within one year of the incident giving rise to it, limiting payment to $1,000. The 1943 amendment raised this threshold to $5,000. The 1956 amendment expanded upon the requirement that the claim arise in a foreign country, recognizing as actionable claims arising anywhere outside the United States, thus broadening the FCA's scope to include maritime claims. Additionally, the 1956 amendment no longer required the claimant to be an inhabitant of the country in which the claim arose. Since 1956, any inhabitant of a foreign country has been able to bring a claim under the FCA. Subsequent amendments repealed the limitation on amounts payable by the Service Secretary, and increased to $100,000 the amount that persons designated by the Secretary may approve for payment. See the Federal Tort Claims Handbook (FTCH) § II, B4l for cases defining a foreign country.

10-2. Scope

a. Eligible claimants.

(1) Inhabitants of foreign countries. The word "inhabitant" conveys a broader meaning than do either the words "citizen" or "national." Usually, it is obvious whether the claimant qualifies as an inhabitant. Soldiers and civilian employees of the U.S. armed forces or other agencies and their family members, who reside in a foreign country mainly because of their own or their sponsors' military orders, are not considered inhabitants of that country. Similarly, a U.S. domiciliary who is in a foreign country as a tourist or visitor or on a business trip will not be considered an inhabitant of the foreign country. In those uncommon situations in which the claimant is a U.S. citizen or national, the test for determining foreign country inhabitant status is whether the claimant dwells in and has assumed a definite place in the economic and social life of a foreign country. Command claims services or area claims offices (ACOs) should design a questionnaire for routine use. A list of recommended questions is posted on the USARCS Web site at "Claims Resources," II, a, no. 10.

(a) Inhabitants of third countries. The foreign country in which the claimant lives and that of the situs of the tort need not be the same because neither the FCA nor its implementing regulations require the claimant to be an inhabitant of the country in which the claim arises. Thus, a French citizen injured by a U.S. Army vehicle while visiting Bosnia is a proper claimant under the FCA.

(b) Death claims. In a wrongful death case, only the decedent must be an inhabitant of a foreign country. Anyone, not otherwise excluded, who would be eligible to assert a claim for the decedent's death under the laws of the country in which the incident causing the death occurred may be a proper claimant.

(2) Corporations. A corporation or other foreign business located in a foreign country may be a proper claimant even though it is organized under U.S. law. Branches, subsidiaries or affiliates of private corporations organized in the U.S. but located and doing business in foreign countries may be proper claimants. The test is whether the corporation or its branch has assumed a definite place in the economic life of a foreign country. If so, it is considered an inhabitant of the country whether or not it is a separate juridical entity.

(3) Enemy nationals. The FCA prohibits paying claims presented by nationals of a country at war with the United States or of countries allied with a country at war with the United States (Armed conflict falls within the meaning of the term "war"). An exception may be made when an FCC or local military commander determines that the claimant is friendly to the United States, or for enemy prisoners of war or interned enemy aliens for torts arising after their capture or surrender, 10 U.S.C. § 2734(b)(2).

(4) Unfriendly nationals. The Commander USARCS may provide instructions to FCCs regarding the processing of claims presented by inhabitants of, or arising in, unfriendly foreign countries. Where the propriety of settling such claims is in doubt, the FCC receiving the claim should seek advice from the commander of its command claims service or the Commander USARCS. Additionally, FCCs may forward to USARCS for adjudication claims brought by inhabitants of countries not at war with, but considered "unfriendly" to, the U.S., or claims brought by persons who, individually, are considered unfriendly to the U.S. This provision grants greater flexibility than a blanket disqualification excluding all nationals of a country at war with the United States unless the individual claimant is considered friendly. "Enemy national" status is a factor in determining whether a potential claimant is eligible to bring a claim under the FCA. This question presents a threshold issue; after that initial finding, a claimant's "unfriendly" status is factored into the exercise of discretion in considering a claim on its merits.

(5) Foreign governmental bodies. Foreign national governments and political subdivisions of foreign countries, including municipalities and local governmental bodies, are proper claimants. The standard exclusion for subrogated claims applies to them. For example, a foreign government may not recover Social Security payments made to an injured beneficiary who files an FCA claim. In considering claims of foreign governmental bodies, however, the adjudicating authority must determine whether any treaty, agreement, or understanding between the U.S. and the foreign country concerned precludes considering the claim under the FCA.

(6) Subrogees. A property damage claim brought by a subrogee is not payable, regardless of whether subrogation arises by operation of law or under the express terms of an insurance policy. Furthermore, a claim or any part of a claim is not payable if it has been recovered or will be recoverable from an employee's workers' compensation or health insurance plan, Social Security, or other indemnifying law or contract.

b. Cognizable claims.

(1) The FCA authorizes compensation for personal injury or death or for damage to or loss of real and personal property.

(2) Claims for damage to or loss of real property incident to its use and occupancy by the U.S. armed forces and for damage to or loss of personal property bailed to the United States are cognizable. See paragraph 2-15m for discussion of real estate claims. Unless the property owner has expressly assumed the risk, claims for loss of or damage to personal property loaned, rented or bailed to the United States are cognizable. However, a claim for property, such as building materials seized without following proper procurement procedures during a deployment should be administered according to procurement law.

c. American Battle Monuments Commission claims. The Army has sole responsibility for claims brought by foreign country inhabitants and arising in foreign countries that seek compensation for loss, damage or injury caused by the wrongful acts or omissions of officers or civilian employees of the American Battle Monuments Commission while acting within the scope of their employment. Such claims are cognizable and may be settled by military FCCs. If meritorious, such claims are paid from the American Battle Monuments Commission's appropriations; see 36 U.S.C. § 2110.

d. Maritime claims. Maritime claims are cognizable if they —

(1) Arise on the high seas.

(2) Involve incidents occurring in the territorial waters of foreign countries. A claim arising from a maritime incident that sounds in tort also may be brought under the Army Maritime Claims Settlement Act, 10 U.S.C. §§ 4801, 4802, and 4806, or by lawsuit under the Suits in Admiralty Act, 46 U.S.C. §§ 30901-30918, or the Public Vessels Act, 46 U.S.C. §§ 31101-31113. See chapter 8 of this publication.

10-3. Claims payable

a. Noncombat activities. A claim arising out of noncombat activities is payable. The glossary in AR 27-20 defines noncombat activities that give rise to cognizable claims. The principles underlying this definition also apply to noncombat claims cognizable under the FCA. See chapter 3 for a discussion of these principles.

b. Combat activities. Claims arising "directly or indirectly" from combat activities of the U.S. armed forces are not payable. Whether damages sustained in areas of armed conflict are attributable to combat activities or noncombat activities depends upon the facts of each case. Damages caused by enemy action, or by the U.S. armed services resisting or attacking an enemy or preparing for immediate combat with an enemy, are certain to be considered as arising from combat activities. The combat exclusion applies whether or not war is declared and applies to hostile actions against the U.S. even where peacekeeping or humanitarian assistance is involved until actual hostilities cease, a determination that can be made by the appropriate operational commander. Prior to any payment, the claimant must be determined to be friendly to the U.S. Training for combat and the operation of military facilities not directly involved in combat actions often will not be classified as combat activities, even though their purpose may be to prepare for combat operations. See FTCH § II, B4k. Similarly, the operation of an aircraft (including its airborne ordnance) while preparing for, going to or returning from a combat mission will not be considered as combat.

c. Acts of Soldiers and civilian employees.

(1) Liability under the FCA may be based on acts or omissions of U.S. Soldiers or civilian employees of a U.S. military department only if they are considered negligent or wrongful. These persons need not be acting within the scope of their employment for their negligent conduct to cause actionable loss, damage or injury. Additionally, there is no bar to claims arising from off-duty or criminal conduct of U.S. Soldiers or civilian employees.

(2) The "scope of employment" restriction to the waiver of sovereign immunity does apply, however, to non-U.S. citizens who are hired locally by the U.S. armed forces and whose negligent or wrongful conduct causes damage, injuries or death in the country in which they were hired to work. The FCA's purpose, to maintain friendly relations with foreign countries and their inhabitants, is not furthered by accepting responsibility for the off-duty acts of local citizens whose only tie to the U.S. Army or other military department is their employment.

(3) Liability may be based on non-scope acts of civilian employees who are not U.S. citizens but who are hired in one country to work in another country. The adjudicating authority may consider the place of hire, the place of employment, and the place of the incident giving rise to the claim in determining liability. For example, the United States need not accept liability for a British citizen' s off-duty acts occurring in England simply because a U.S. military department hired this tortfeasor to work in Germany.

10-4. Claims not payable

See the exclusions set forth in AR 27-20, chapter 2, section V , Determination of liability, which are further discussed in paragraphs 2-36 through 2-43 of this publication. See also AR 27-20, paragraph 10-4 .

a. Domestic obligations. Claims arising from private domestic obligations rather than government transactions are not payable. Such claims arise through off-duty conduct of U.S. military or civilian personnel for which the persons incurring them may be held personally accountable. At times, claimants may seek compensation for damage to or loss of personal property bailed to individual members of a U.S. armed force. If the damage or loss results from a noncombat activity, the bailor's claim may be payable. However, although the United States accepts liability for damage to and loss of property bailed to the United States, it will not accept liability for bailments that constitute private domestic obligations.

b. Contractual claims. Claims brought pursuant to a personal contract with a U.S. Soldier or civilian employee are not payable. For example, a claim for damages resulting from a U.S. Soldier passing a bad check would not be payable, nor would one for property damage to a privately owned vehicle loaned to a U.S. Soldier for personal purposes. Note, however, that if the U.S. Soldier caused a vehicle collision, any damage to a third party's car would be payable. Similarly, a FCA claim brought by the immediate relatives of a foreign citizen spouse of a U.S. Soldier who murdered the spouse is cognizable because the damages arise not out of the marriage contract but from the murder, a criminal act.

10-5. Applicable law

The amount allowed for compensation will not exceed the amount normally allowed in the place of occurrence, whether by law or custom. Since many countries pay social benefits which replace the monetary damages normally allowed by local courts, the adjudicating authority should take this into consideration when determining the amount allowed. (Remember that the FCA does not permit subrogation, even when governmental agencies are the subrogees). Generally, AR 27-20 , subparagraphs 3-5(b) through (d), provides sufficient guidance to determine allowable elements of damages. However, where moral