TITLE:  U.S. Court of Appeals for Veterans Claims: Retroactive Reimbursement of Professional Liability Insurance Costs, B-300866, May 30, 2003
BNUMBER:  B-300866
DATE:  May 30, 2003
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U.S. Court of Appeals for Veterans Claims: Retroactive Reimbursement of
Professional Liability Insurance Costs, B-300866, May 30, 2003

   Decision
    
    
Matter of:   U.S. Court of Appeals for Veterans Claims: Retroactive
Reimbursement of Professional Liability Insurance Costs
    
File:            B-300866
    
Date:           May 30, 2003
    
DIGEST
    
Section 605 of Public Law No. 107-103, December 27, 2001, amended title 38
of the United States Code by adding new section 7287.  It provides that
the United States Court of Appeals for Veterans Claims (CAVC) may exercise
the management, administrative, and fund expenditure authorities available
to other U.S. courts as defined in 28 U.S.C. S: 451.  In exercising this
authority, the CAVC's Board of Judges passed a resolution authorizing the
Court to utilize the authority found in Public Law No. 105-277, October
21, 1998, as amended (found at 5 U.S.C. prec. S: 5941 note), to reimburse
eligible employees for one-half the cost of professional liability
insurance.   Since the change in the law adding 38 U.S.C. S: 7287 was not
explicitly made retroactive, it does not apply to professional liability
insurance payments made prior to the effective date of the legislation,
December 27, 2001.
    
DECISION
    
This is in response to a request for an advance decision pursuant to 31
U.S.C. S: 3529 by the Financial Manager of the United States Court of
Appeals for Veterans Claims (CAVC) on whether the CAVC may retroactively
reimburse an eligible Court employee for one-half the cost of professional
liability insurance paid during calendar years 1998 to 2001.  For the
reasons stated below, we find that the effective date of the authority to
pay the premium involved is not earlier than December 27, 2001, the date
of passage of the amendment adding 38 U.S.C. S: 7287, which allowed the
CAVC to utilize the professional liability insurance reimbursement
authority.  The statutory language of 38 U.S.C. S: 7287 does not
specifically state that any entitlements arising under its authority
should be provided retroactively, nor does the legislative history clearly
indicate that such entitlement was meant to be retroactive.
    
BACKGROUND
    
    
The CAVC was established by Congress under Article I of the Constitution
as an independent tribunal not subject to the control of the President or
the Administrative Office of the U.S. Courts.  38 U.S.C. S: 7281.  The
CAVC submits its budget directly to and receives its appropriations
directly from Congress, and is permitted to develop its own personnel and
job classification system for its judicial and nonjudicial personnel.  38
U.S.C. S:S: 7281(a)--(g), 7282.  As a result of this independent status,
the CAVC has not had available to it the same general management,
administrative, and expenditure authorities available to the Article III
courts.  Since its establishment, there have been various times that the
CAVC has requested and Congress has enacted various gap-filling statutory
provisions.  See S. Rep. No. 86, 107th Cong., 1st Sess., at 28 (2001) and
H.R. Rep. No. 156, 107th Cong., 1st Sess., at 6-7, 22-24 (2001) for a list
of gap-filling statutory provisions. 
    
One authority from which the CAVC was definitionally excluded was the
authority to cover a portion of the costs incurred by its employees for
professional liability insurance.  Government employees, whose jobs place
them in positions where they risk being sued for certain tortious conduct,
may purchase liability insurance as a protection against such suits, which
may result in an award of compensatory or punitive damages that the
federal employees themselves would be required to pay.   See B-211883,
Dec. 14, 1983.  In 1996, as part of the Omnibus Consolidated
Appropriations Act for Fiscal Year 1997,[1] Congress enacted legislation
authorizing the reimbursement of *qualified employees* of the executive
and legislative branches for up to one-half the costs incurred by such
employees for professional liability insurance.  These permissive
reimbursements were to be paid from amounts appropriated for salaries and
expenses.  In 1998, Congress amended the law to include as *qualified
employees* justices, judges, judicial officers, supervisors, and managers
within the judicial branch.[2]   In doing so, the amendment defined
*justices* and *judges* as those covered by 28 U.S.C. S: 451, which
excluded judges of the CAVC.  Then, in 1999, Congress once again amended
the law to make the reimbursement mandatory as of October 1, 1999.[3]  The
statute now provides in relevant part:
    
*Notwithstanding any other provision of law, amounts appropriated . . .
for salaries and expenses shall be used to reimburse any qualified
employee for not to exceed one-half the costs incurred by such employee
for professional liability insurance.  A payment under this section shall
be contingent upon the submission of such information or documentation as
the employing agency may require.*[4]
    
The statute provides that a *qualified employee* means an agency employee
whose position is that of a law enforcement officer or a supervisor or
management official.  Id.  It defines the term *agency* to mean: an
*Executive agency* as defined by 5 U.S.C. S: 105; *any agency or court in
the Judicial Branch*; or *any agency of the Legislative Branch of
Government including any officer or committee of the Senate or the House
of Representatives.* Id.  With regard to the Judicial Branch, the terms
*supervisor* and *management official* mean a justice or judge of the
United States as defined in 28 U.S.C. S: 451, the so-called *Article III*
judges whose courts were established under Article III of the
Constitution.  Id.  As an Article I court, the authority to pay these
costs did not extend to the CAVC.
    
Recently, Congress added section 7287 to the CAVC's statutory grants of
authority in title 38 of the United States Code,[5] which provides:
    
*Notwithstanding any other provision of law, the Court of Appeals for
Veterans Claims may exercise, for purposes of management, administration,
and expenditure of funds of the Court, the authorities provided for such
purposes by any provision of law (including any limitation with respect to
such provision of law) applicable to a court of the United States (as that
term is defined in section 451 of title 28), except to the extent that
such provision of law is inconsistent with a provision of this chapter [38
U.S.C. S:S: 7251 et seq.].*
    
According to the materials submitted by the CAVC Clerk of the Court, the
CAVC's Board of Judges used the authority granted in 38 U.S.C. S: 7287 to
pass a resolution authorizing the CAVC to exercise the authority found in
Public Law 105-277, supra, as amended by Public Law 106-58, supra, to
reimburse designated judges and managers for one-half of the costs of a
professional liability insurance policy.  Letter from Norman Y. Herring,
Executive Officer/Clerk of the Court, CAVC, to Comptroller General, GAO,
March 6, 2002, appending *Resolution Before the Board of Judges, United
States Court of Appeals for Veterans Claims,* approved on January 30,
2002.[6]  On February 25, 2002, Chief Judge Kramer filed a claim for
reimbursement of one-half the cost of his professional liability insurance
premiums for calendar years 1998 through 2001. 
    
The Financial Manager believes that, since the enactment of 38 U.S.C. S:
7287 and the Board of Judges' resolution on insurance premiums occurred in
fiscal year 2002, that portion of the Chief Judge's claim covering October
2001 through December 2001 is payable as a necessary expense of fiscal
year 2002.  She views the remainder of the claim as falling into two
buckets: (1) the portion of the claim covering fiscal years 2000 and 2001
(October 1999 through September 2001), which occurred during the time that
Congress amended the legislation to make the payment mandatory for Article
III judges; and (2) the portion of the claim covering the period from
January 1998 through September 1999, when the reimbursement was
discretionary, noting especially that during part of that period no court
was covered until added by Public Law 105-277, supra, October 21, 1998. 
Statement by Ann B. Olson, CAVC Financial Manager, appended to the Letter
from Norman Y. Herring, supra.  The Financial Manager seeks our views on
which portion of the Chief Judge's claim may be reimbursed.
    
DISCUSSION
    
It is well established that in the absence of statutory direction,
retroactivity is not favored by the law.  INS v. St. Cyr, 533 U.S. 289,
121 S. Ct. 2271 (2001); Kaiser Aluminum & Chem. Corp. v. Bonjorno, 494
U.S. 827, 855, 110 S.Ct. 1570 (1990) (Scalia, J., concurring); Bowen v.
Georgetown Univ. Hospital, 488 U.S. 204, 208, 109 S. Ct. 468 (1988).  The
general rule of statutory construction is that a statute is effective on
and after the date of its enactment unless it is clear from its language
or by necessary implication that a different effective date was intended. 
62 Comp. Gen. 396 (1983); B-259479, B-259479.4, July 25, 1996; B-237791,
Sept. 6, 1991; 2 Norman J. Singer, Sutherland Statutes and Statutory
Construction S: 41:4 (6th ed. 2001). 
    
For example, in 62 Comp. Gen. 396 (1983), cited above, we considered
circumstances analogous to those in this case and applied the general rule
that an amendatory statute is applied prospectively only absent specific
congressional direction.  In that case, Congress enacted 5 U.S.C. S:
5546a(a) in order to correct an inequity involving premium pay.  Under the
prior legislation, instructors at the Federal Aviation Academy in Oklahoma
City who train individuals to perform air traffic control, airway
facilities, and flight inspection functions would not be entitled to
premium pay while those whom they trained were entitled to the additional
compensation.  The amendment permitted these instructors and their
immediate supervisors to receive the premium pay.  We found that neither
the express language of the amendatory statute nor the legislative history
provided support for the view that the amendment was retroactively
effective.  Remarks in the legislative history on the intended equality of
treatment of the Academy instructors were insufficient to demonstrate the
requisite congressional intent that the provision would operate
retroactively.  The Academy instructors' entitlement to the premium pay
under 5 U.S.C. S: 5546a(a) was prospective only, from the date of
enactment of the amendment.
    
In this case, there is nothing in the language of either section 605 or
any other section of Public Law 107-103 which provides that actions taken
by the CAVC under this authority, such as the Board of Judges' resolution
authorizing the CAVC to exercise the insurance reimbursement authority,
could be done on a retroactive basis.  In addition, an examination of the
legislative history of section 605 does not establish the existence of a
legislative intent that the authority granted in the amendment may be used
retroactively.  The statement in the Senate Report on the bill that
included section 605 shows that the purpose of the section was to make the
authorities granted to Article III courts available to the CAVC:
    
*Section 605 of the Committee [on Veterans' Affairs] bill, derived from S.
1063 and as requested by the court [CAVC], would provide a generic
authority for it to use court-related management, administrative, and fund
expenditure authorities that are appropriate for its efficient operation. 
This would preclude the need for gap-filling provisions.  For example,
there are two recently enacted authorities that the court is lacking, but
that seem to be generally available to the rest of the Federal Government,
to reduce the risk of personal liability for official actions (5 U.S.C.
subchapter IV note found preceding 5 U.S.C. S: 5941 [professional
liability insurance reimbursement]; 28 U.S.C. S: 613 [designation of
disbursing and certifying officers]; 31 U.S.C. S: 3529 [authority for
disbursing or certifying officers to seek an opinion from the Comptroller
General on any question of law involved in a payment request presented for
certification]).  Under the proposed new section, the court would have
these types of authorities available to it.  However, the court would not
have available any provision of law that is inconsistent with any
provision of chapter 72 of title 38.  Moreover, the court would have to
exercise the new authority in accordance with all limitations with respect
to the underlying authorities themselves, subject, as with all
authorities, to the availability of appropriations provided for its
operation.*
    
S. Rep. 107-86, supra, at 28 (explanatory information provided in
bracketed language).  Similar language concerning this new authority for
the CAVC can be found in the House Report.  H.R. Rep. 107-156, supra, at
6-7.  While the language clearly shows that Congress expected the CAVC to
use the new authority provided in 38 U.S.C. S: 7287 to exercise the
professional liability insurance reimbursement provisions, there is no
indication of legislative intent that the entitlement of CAVC eligible
employees to the reimbursement was to operate on a retroactive as well as
a prospective basis. 
    
CONCLUSION
    
In the absence of express language or a clear implication in the statute
or legislative history, the eligible CAVC employees' entitlement to
professional liability insurance reimbursement is prospective only, from
the date of enactment of Public Law 107-103, December 21, 2001.  There is
therefore no authority to pay any of the claims presented by Chief Judge
Kramer for liability insurance premiums paid before that date.
    
    
/signed/
    
Anthony Gamboa
General Counsel
    

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   [1] Pub. L. No. 104-208, div. A, title I, S: 101(f), 110 Stat. 3009
(incorporating title VI, S: 636 of the Department of the Treasury, Postal
Service, and General Government Appropriations Act, 1997), 110 Stat.
3009-363 to 3009-364, Sept. 30, 1996.
[2] Omnibus Consolidated and Emergency Supplemental Appropriations Act,
1999, Pub. L. No. 105-277, title VI, S: 644, 112 Stat. 2681-526, Oct. 21,
1998.
[3] Treasury and General Government Appropriations Act, 2000, Pub. L. No.
106-58, title VI, S: 642(a), 113 Stat. 430, 437, Sept. 29, 1999.  
[4] These provisions were not enacted in the form of an amendment or
addition to title 5, U.S. Code, although their text is set out as an
uncodified note under subchapter IV, *Miscellaneous Allowances,* preceding
5 U.S.C. S: 5941.
[5] Veterans' Benefits Improvement Act of 2001, Pub. L. No. 107-103, S:
605, 115 Stat. 976 (December 21, 2001).
[6] The March 6, 2002, letter from Mr. Herring to the Comptroller General
got caught in the postal irradiation procedures and did not reach our
Office until March 6, 2003.  On March 7, 2003, we verified by phone that
the CAVC was still interested in receiving a response to the letter.