Court Opinion

ID: 9449533
Source: CourtListenerOpinion
Date Created: 2023-08-04 16:14:33.052865+00
Date Added: 2024-06-11T17:31:52.235113
License: Public Domain

DAVIS, Judge
(dissenting in part).
I dissent from the holding that the parties had not agreed to be bound by the Vitarelli decision on so-called “lost leave."2 To me it is clear from the correspondence set forth in the findings (i) that, no later than the early months of 1961, plaintiff and defendant had informally joined in an agreement that Vitarelli — decided on June 8, 1960— would govern all aspects of the present case except for the deduction of the life insurance premiums, and (ii) that a stipulated judgment would be entered on that basis. In September 1960, over three months after Vitarelli was handed down, defendant’s counsel wrote plaintiff’s attorney that “we agree with you that the Vitarelli decision apparently disposes of all of the issues in this case other than the claim which you have asserted in connection with the deduction of premiums of the Federal Employees Group Life Insurance.” In January 1961, defendant supplied plaintiff’s counsel with a computation under the Vitarelli rule of the amount due for the “lost leave.” Thereafter the only subject left open was the matter of the insurance premiums; the communications between the parties revolved around that still unsettled issue and assumed that agreement had already been reached on the other aspects of tfce case. Although defendant ultimately rejected an offer in compromise, its letters did not suggest that there was no such agreement on the leave question or seek to withdraw from it. The plaintiff’s attorney obviously thought all the while that he had an existing agreement. He had good reason to think so and the defendant did nothing to disabuse him. Its letters, throughout its course of dealings with plaintiff’s attorney after the Vitarelli decision, are quite consistent with an understanding between counsel that the Vitarelli rule would be the basis for judgment in this case on the issues which that decision covered. There was never any indication to the contrary. In these circumstances, I would apply the normal rule that the external conduct of the parties, not the undisclosed intention of one of them, determines whether an agreement has been made (see, e. g., The Padbloc Company, Inc. v. United States, Ct.Cl., No. 523-57, decided April 5, 1963; Mansfield v. Hodgdon, 147 Mass. 304, 306, 17 N.E. 544, 547 (1888)), and therefore hold that the plaintiff and defendant did reach a definite settlement agreement on the major issue in the case.3
The court is not bound-and-tied by that agreement,4 but I see no sufficient reason for refusing to enforce it. The absence *928■of a formal stipulation of settlement is not enough. Campbell v. United States, 19 Ct.Cl. 426 (1884). Nor is it enough that Zeiger v. United States, Ct.Cl., No. 389-60, decided Nov. 1, 1961, 295 F.2d 915, now shows Vitarelli to have been wrong as to compensation for “lost leave.” “The policy of the law has always been to promote and sustain the ■compromise and settlement of disputed claims” (Backus v. United States, 75 Ct.Cl. 69, 104, 59 F.2d 242, 259 (1932), cert. denied, 288 U.S. 610, 53 S.Ct. 402, 77 L.Ed. 984), and a settlement often rests on the acceptance by one party or the other of a doubtful point of law or fact. As Chief Judge Bazelon recently •said for the District of Columbia Circuit, ■« * * * a settlement payment made when the law was uncertain, cannot be ¡successfully attacked on the basis of any subsequent resolution of the uncertainty. Otherwise the public policy of •encouraging settlements would be seriously undermined.” Moses-Ecco Company, Inc v. Roscoe-Ajax Corp., C.A.D.C., 320 F.2d 685, 690 (footnote omitted). This court has gone so far as to say that “[i]t is not essential that the •question be in fact doubtful in legal contemplation” (Trumbull Steel Co. v. United States, 76 Ct.Cl. 391, 400-401, 1 F.Supp. 762, 766 (1932)), and it quoted (76 Ct.Cl. at 402, 1 F.Supp. at 767) from Hennesey v. Bacon, 137 U.S. 78, 85, 11 S.Ct. 17, 34 L.Ed. 605 (1890): “Such a settlement ought not to be overthrown, even if the court should now be of opinion that the party complaining of its surrendered rights that the law, if appealed to, would have sustained.” Because it is not normally concerned with the soundness of a compromise, the court customarily accepts stipulated settlements calling for judgments against the United States, without any inquiry into the correctness of the legal principles or factual assumptions on which the compromise may be founded. As this practice shows, it does not make any difference that the settlement agreement was consummated after the litigation was begun.
In addition, there is, in my view, a reason special to this case why the settlement agreement on “lost leave” should be accepted and enforced. If it were not for the second issue (relating to premium deductions) on which the parties continued to disagree, it is very probable that a consent judgment would have been filed in plaintiff’s favor, on the basis of the Vitarelli decision, well before the Zeiger ruling. The delay in entering judgment due to this extraneous factor should not be allowed to prejudice plaintiff.5

. I concur in the judgment on the other issue, involving the deduction of the life insurance premiums, on the ground that this plaintiff was not and could not be accorded the option of taking or declining the insurance during the period of his suspension (since he was suspended before the Federal Employees’ Group Insurance Act took effect).

. A partial settlement is as binding as a total one if the parties have not agreed to keep all questions open until a full accord on all matters under discussion. Here, the exchange of correspondence shows that the question of “lost leave” was never considered to be open after the parties had once agreed upon it.

. Putting to one side the possible exception of tax agreements entered into by the Commissioner of Internal Revenue under his special authority (see Lang-Kidde Co. v. United States, 77 Ct.Cl. 280, 2 F.Supp. 708 (1933); Brown v. United States, 83 Ct.Cl. 360, 14 F.Supp. 520 (1936)), it is clear that this court has power to reject a compromise agreement if there is good reason, just as it has power to reject a stipulation on a particular issue. See *928Federal Export Corp. v. United States, 88 Ct.Cl. 60, 83-84, 25 F.Supp. 109, 121 (1938) cert. dented, 308 U.S. 590, 60 S.Ct. 120, 84 L.Ed. 494 (1939); Cowles v. United States, 99 Ct.Cl. 731, 742, 50 F.Supp. 242, 247 (1943); Davidson Corp. v. United States, Ct.Cl., 310 F.2d 937, 939.

. This special reason, for accepting the settlement did not exist in Albin v. United States, 136 Ct.Cl. 801 (1956), and similar cases.