Irving v. USA

Opinion

Irving v . USA CV-81-501-M 03/13/96 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Gail Merchant Irving, Plaintiff, v. Civil N o . 81-501-M United States of America, Defendant.

O R D E R

Plaintiff, Gail Irving, sues defendant, the United States,

under the Federal Tort Claims Act ("FTCA"), 28 U.S.C. §§ 1346(b),

2671-2680, seeking damages for injuries she suffered in a

workplace accident. Irving moves to increase her ad damnum to an

amount in excess of the $1,000,000 she sought in her original

administrative claim. For the reasons discussed below, Irving's

motion is necessarily denied.

I. PROCEDURAL AND FACTUAL BACKGROUND

Irving suffered serious personal injuries in a workplace

accident she attributes in part to government negligence. The

accident occurred on October 1 0 , 1979. Before bringing her

negligence suit against the United States under the FTCA, Irving

filed an administrative claim with the appropriate federal agency, the United States Department of Labor. That claim was

filed on November 2 5 , 1980. See 28 U.S.C. § 2675(a) ("An action

shall not be instituted upon a claim against the United States

for money damages for injury . . . unless the claimant shall have

first presented the claim to the appropriate Federal agency.")

In her administrative claim, Irving requested money damages in

the amount of $1,000,000.

On October 7 , 1981, Irving filed her complaint in this court

seeking damages from the United States under the FTCA. The FTCA

provides that, with limited exceptions, "[a]ction under this

section shall not be instituted for any sum in excess of the

amount of the claim presented to the federal agency." 28 U.S.C.

§ 2675(b). Consistently with the statute, the ad damnum clause

of Irving's complaint requested money damages in the amount of

$1,000,000, the same amount she requested in her administrative

claim.

This case is unusual in that it has been pending for an

extraordinary length of time. Plaintiff's fifteen year journey

through the judicial system, to date, has included three separate

appeals to the Court of Appeals for the First Circuit, the latest

opinion in the case being Irving v . United States, 49 F.3d 8 3 0 ,

2 837 (1st Cir. 1995). None of the blame for the unusual delay

rests with the plaintiff.

II. DISCUSSION

The FTCA limits a plaintiff's ability to seek damages in court in excess of the amount sought in an administrative claim

to instances in which there is newly discovered evidence or

intervening facts: Action under this section shall not be instituted for any sum in excess of the amount of the claim presented to the federal agency, except where the increased amount is based upon newly discovered evidence not reasonably discoverable at the time of presenting the claim to the federal agency, or upon allegation and proof of some intervening facts, relating to the amount of the claim.

28 U.S.C. § 2675(b). Irving says she is entitled to an increase

in her ad damnum on both grounds - intervening facts and newly

discovered evidence.

First, Irving argues that the fifteen year life of this case

is highly unusual and was unpredictable at the outset. She then

asserts that the general economic inflation experienced during

that time has devalued her damage request beyond what ordinarily

might be expected. In short, she claims that the unusual delay

and its resulting devaluation of her original claim constitute

3 "intervening facts" relating to the amount of the claim. Second,

Irving contends that medical diagnoses obtained in 1982, after

her administrative filing, constitute newly discovered evidence

not reasonably discoverable at the time of presenting the claim

to the administrative agency.

A. Delay and Inflation as Intervening Facts

On its face, Irving's first contention presents a rather

straightforward question: Does extraordinary delay and its

attendant economic inflation qualify as an intervening fact

sufficient to permit increase in the plaintiff's demand beyond

that claimed at the administrative level? It is undeniable that,

in the fifteen years between the date Irving filed her

administrative claim and today, inflation has affected the value

of money. It is equally unassailable that such inflation

"relat[es] to the amount of the claim," 28 U.S.C. § 2675(b), at

least in a general sense, because $1,000,000 in today's dollars

is worth less than $1,000,000 in 1980 dollars. Both law and

equity, then, would seem to weigh substantially in favor of

granting Irving's motion to increase her ad damnum. The issue is

complicated, however, by the fact that Irving's request to

4 increase her ad damnum to account for inflation during the delay

sounds much like a request for pre-judgment interest.

Absent an express waiver of sovereign immunity from an award

of interest, the United States is immune from interest awards.

Library of Congress v . Shaw, 478 U.S. 3 1 0 , 314 (1986).

"[F]ederal statutes cannot be read to permit interest to run on a

recovery against the United States unless Congress affirmatively

mandates that result." Id. at 316. Further, under the "no-

interest rule," congressional waiver of immunity from interest

must be express; it cannot be implied by operation of a statute

or inferred from a general waiver of sovereign immunity from

damages. Id. at 314-18.

The FTCA contains no express waiver of immunity from awards

of interest. To the contrary, the statute expressly incorporates

the no-interest rule as applied to pre-judgment interest,

stating, "The United States . . . shall not be liable for

interest prior to judgment . . . ." 28 U.S.C. § 2674; Library of

Congress, 478 U.S. at 318-19 n.6. In light of this express

incorporation of the no-interest rule, that section of the FTCA

that allows increased damages in the case of "intervening facts,"

28 U.S.C. § 2675(b), cannot be read to allow an increase that i s ,

in reality, pre-judgment interest.

5 Of course, Irving's motion does not expressly request pre-

judgment interest. Rather, the motion seeks to increase the ad

damnum to account for the fact that "the actual value of

$1,000,000, in 199[6], is markedly lower than its value in 1980."

(Irving Mot. at 5.) Plaintiff points to inflation as the obvious

reason for the decrease in value. (Irving Mot. at 6.) The

question that must be decided, then, is whether Irving's offered

basis for increasing her ad damnum, although called "inflation,"

i s , in character if not in name, a claim for pre-judgment

interest.

Although Irving has couched her request as one for

compensation for delay and inflation, the Supreme Court has made

clear that "the force of the no-interest rule cannot be avoided

simply by devising a new name for an old institution." Library

of Congress, 478 U.S. at 321. [T]he character or nature of "interest" cannot be changed by calling it "damages," "loss," "earned increment," "just compensation," "discount," "offset," or "penalty," or any other term, because it is still interest and the no-interest rule applies to i t .

Id. (quotations omitted). Interest and compensation for delay

"share an identical function." Id. at 322. "They are designed

to compensate for the belated receipt of money." Id. "Thus,

6 whether the loss to be compensated by an increase in a[n] . . .

award stems from an opportunity cost or from the effects of

inflation, the increase is prohibited by the no-interest rule."

Id. (citing Saunders v . Clayton, 629 F.2d 596, 598 (9th Cir.

1980) ("In essence, the inflation factor adjustment is a

disguised interest award . . . . " ) , cert. denied, 450 U.S. 980

(1981)); see also Preston v . United States, 776 F.2d 7 5 4 , 760

(7th Cir. 1985) (finding that compensation for loss of use of

award over twelve year period "would clearly be an award of

prejudgment interest, which is barred by the Federal Tort Claims

A c t " ) ; Barrett v . United States, 660 F. Supp. 1291, 1319-20

(S.D.N.Y. 1987) ("Whether the adjustment plaintiff requests is

called pre-judgment interest, `compensation for the time value of

money,' or `compensation for delay,' it cannot be allowed because

of the express prohibition in Section 2674" of the FTCA). But see

McMichael v . United States, 856 F.2d 1026, 1036 (8th Cir. 1988)

(stating (without distinguishing Library of Congress v . Shaw)

that "[d]ecline in the value of the dollar is not equivalent to

an award of prejudgment interest").

Therefore, Irving's request to increase the ad damnum to

account for delay and inflation i s , in effect, a request for pre-

judgment interest and, as such, must be denied. While

7 application of the no-interest rule, as codified in 28 U.S.C. §

2674, might appear harsh in this case, it "is an injustice for

Congress, not this court, to correct." Barrett, 660 F. Supp. at

1320.

B. Medical Diagnoses as Newly Discovered Evidence

In further support of her motion to increase her ad damnum,

Irving claims that her physician's diagnoses, made in 1982,

confirming that she has a 30% permanent disability in her

extremities and a similar disability in her trunk, constitute

newly discovered evidence not reasonably discoverable at the time

of presenting the claim to the federal agency. This argument,

too, fails under prevailing law.

In Reilly v . United States, 863 F.2d 149 (1st Cir. 1988),

the Court of Appeals for the First Circuit addressed in detail

the "newly discovered evidence" exception contained in 28 U.S.C.

§ 2675(b).

Because the statute itself renders the state of a claimant's knowledge (actual or constructive) at the time of presentment of the claim of decretory significance, the mechanics of a § 2675(b) inquiry must be double-barrelled: What should the party have known? When should she have known it? To be binding in this context, knowledge need not be certain. In the same vein, intelligence which serves only to bear out earlier

8 suspicions cannot unlock the FTCA's narrow escape hatch. Diagnoses which are no more than cumulative and confirmatory of earlier diagnoses are neither "newly discovered evidence" nor "intervening facts" for the purposes of § 2675(b). We agree with the Second Circuit that the statute demands a showing that "some new and previously unforeseen information came to light" between the time of filing the administrative claim and the trial on damages. Id. at 171 (citations omitted and emphasis added).

In support of her motion, Irving alleges, "It was not until

1982 that [her] primary treating physician confirmed that she has

a 30% disability for each of the four extremities, and a similar

disability rating for the trunk area." (Irving Mot. at 8.)

However, the court of appeals has noted that "if the exact

nature, extent and duration of each recognized disability must be

known before § 2675(b) will be given effect, that section will be

rendered useless." Reilly, 863 F.2d at 172. In addition, Irving

claims, "[W]hat was once a somewhat uncertain claim largely

dependent on future damages is now, sadly, a certain indisputable

claim for past damages . . . ." (Irving. Mot. at 9.) Reilly

makes clear, however, that "[t]he mere fact that these dread

consequences, feared from the beginning, had become more certain

does not suffice to brand them `newly discovered.'" Reilly, 863

F.2d at 172.

9 Other than the passage of time that has transformed some of

her future damages into past damages and confirmed what once

might have been speculative damages, Irving points to no "new and

previously unforeseen information" bearing on damages that has

come to light since she filed her administrative complaint.

Therefore, Irving's motion to increase the ad damnum to an amount

in excess of her administrative claim must be denied.

III. CONCLUSION

Because Irving's motion to increase the ad damnum to account

for the effects of delay and inflation i s , in effect, an

impermissible request for pre-judgment interest, and because she

presents no newly discovered evidence, Irving's motion to

increase her ad damnum to an amount in excess of her

administrative claim (document n o . 145) is denied.

SO ORDERED.

Steven J. McAuliffe United States District Judge

March 1 3 , 1996

10 cc: Phyllis Jackson Pyles, Esq. Gretchen Leah Witt, Esq. Paul R. Cox, Esq.