Court Opinion

ID: 9483867
Source: CourtListenerOpinion
Date Created: 2023-08-05 09:33:27.821005+00
Date Added: 2024-06-11T17:49:52.644402
License: Public Domain

HEANEY, Senior Circuit Judge,
dissenting:
I respectfully dissent. While I agree with the majority that the forest service exercises protected discretionary functions when it determines the means and manner of managing the national forests, selects contractors to assist in that task, and .supervises the performance of the work, I part company with my brethren when this court affirms as a protected discretionary governmental function the forest service’s practice of hiring cheap, uninsured labor to do the most dangerous of the work.
This disturbing case involves an agency of the United States Government contracting a small-time operator to carry out what the government admits was manifestly dangerous work — without requiring the standard security of accident insurance afforded to other employees of the government. The record suggests the contracting agent knew the contractor had no insurance, knew the work was hazardous, and *1506yet hired the labor to carry out the job at a price that precluded even the possibility of purchasing workers’' compensation coverage. The result I cannot sanction as proper: one man is now dead and another paralyzed, and neither man’s family can hope to recover some compensation for the devastating loss because the government denies any responsibility.
In two terse paragraphs the majority affirms the summary judgment of the district court on the plaintiffs’ claim of negligence for failure to require workers’ compensation coverage. In my judgment, it is setting very bad precedent to affirm this course of government conduct as a legitimate exercise of discretion. It is an invitation to irresponsible branches of government to contract out for cheap, uninsured labor whenever dangerous work needs to be done.
Apart from the distressing factual nature of the case, I believe the majority errs — and that the district court erred also — in so quickly concluding that the contracting officer exercised a discretionary function when he entered into a contract for the performance of dangerous services on a government installation without first requiring insurance coverage. The majority easts the issue merely as whether the forest service exercised discretion when failing to enforce the contractor’s compliance with state law — compliance generically required by the contract. The real issue, however, is whether the forest service had discretion to enter into such a contract in the first place without specifically requiring insurance coverage. The majority would hold that if Arkansas law did not require workers’ compensation coverage, there was no independent obligation for the forest service to require the insurance; and that if Arkansas law did require the insurance, there was no government obligation to verify coverage before signing the contract. I disagree.
The Service Contract Act of 1965, 41 U.S.C. §§ 351-358 (1982), requires every service contract entered into by the United States in excess of $2,500, with exceptions not here relevant, to include those fringe benefits prevailing for such employees in the locality, including “compensation for injuries or illness resulting from occupational activity, or insurance to provide ... the foregoing, life insurance, [and] accident insurance....” Id. at § 351(a); see also 48 C.F.R. § 22.1002-1 (1991) (“Service contracts over $2,500 shall contain mandatory provisions regarding minimum wages and fringe benefits, [and] safe and sanitary working conditions_” (emphasis added)).
The Federal Acquisition Regulations (FAR) also express significant concern for the provision of insurance coverage in most government contracts, and not only require compliance with applicable federal, state, and local regulations, but also explicitly require insurance coverage in certain contracts. See, e.g., 48 C.F.R. § 28.301(b) (1991) (“Contractors ... are required by law and this regulation to provide insurance for certain types of perils (e.g. workers’ compensation).”); 48 C.F.R. § 28.307-2(a) (1991) (“Contractors are required to comply with applicable Federal and State workers’ compensation and occupational disease statutes.... Employer’s liability coverage of at least $100,000 shall be required, except in States with exclusive or monopolistic funds that do not permit workers' compensation to be written by private carriers.” (emphasis added)); 48 C.F.R. § 28.307-2(b) (1991) (“The contracting officer shall require bodily injury liability insurance coverage written on the comprehensive form of policy of at least $500,-000 per occurrence.” (emphasis added)).
The FAR also require the contracting officer to ensure the lawfulness and integrity of the contract before entering, into it. 48 C.F.R. § 37.103(a) (1991) (“The contracting officer is responsible for ensuring that a proposed contract for services is proper.”); 48 C.F.R. § 1.602-1(b) (1991) (“No contract shall be entered into unless the contracting officer ensures that .all requirements of law, executive orders, regulations, and all other applicable procedures, including clearances and approvals, have been met.” (emphasis added)).
This is not a situation like that described in Varig Airlines in which a government agency exercises discretion to spot check a contractor’s compliance with a regulatory scheme. In this case, the government con*1507tracting officer should never have entered into the contract in the first place. He not only abused discretion by letting out a contract to do especially dangerous work to a low-bidding contractor who had no insurance, but also did so at a contract price that precluded obtaining the insurance, and disregarded relevant regulations in the process.
In my judgment, the contracting officer had no discretion to enter into this contract without requiring workers’ compensation insurance coverage. Because the contracting officer had no such discretion, the district court erred in granting summary judgment based on the discretionary function exemption to the Federal Tort Claims Act. I would remand this case to the district court to determine if Arkansas courts recognize an appropriate cause of action based on these facts.
Order Denying Petition for Rehearing and Suggestion for Rehearing En Banc
The suggestions for rehearing en banc are denied. Judge McMillian would grant the suggestions.
The petitions for rehearing by the panel are also denied.
Judge John R. Gibson and Judge Morris S. Arnold took no part in the consideration or decision of this case.