38 U.S. Op. Atty. Gen. 98
COMPROMISE OF CLAIMS UNDER SECTIONS 3469 AND 3229 OF THE REVISED
STATUTES--POWER OF THE ATTORNEY GENERAL IN MATTERS OF COMPROMISE
[98] The opinion of the Attorney General to the Secretary of
the Treasury
dated October 24, 1933, relating to the power to compromise
conferred by sections
3469 and 3229 of the Revised Statutes, is not to be construed as
precluding the
compromise of cases in which there is uncertainty as to liability
or collection;
nor is that opinion to be understood as involving or restricting
the authority
and discretion of the Attorney General in matters of compromise.
In cases referred to the Department of Justice, whatever
powers of
compromise were conferred by the above-mentioned sections are now
vested in the
Attorney General by virtue of section 5 of Executive Order No. 6166
of June 10,
1933.
The Attorney General has plenary power to compromise cases
referred to the
Department of Justice. This power is in part inherent,
appertaining to the
office, and in part derived from various statutes and decisions.
To the SECRETARY OF THE TREASURY.
SIR:
In connection with my opinion of October 24, 1933 (38 Op. 94),
dealing with
the power to compromise conferred by Sections 3469 and 3229 of the
Revised
Statutes, I have given careful consideration to the class or group
of cases
outlined in your letter to me of January 30, 1934.
The conclusion reached in the opinion is that 'where liability
has been
established by a valid judgment or is certain, and there is no
doubt as to the
ability of the Government to collect, there is no room for 'mutual
concessions',
and therefore, no basis for a 'compromise". The word 'certain'
relates, of
course, to claims which are liquidated or undisputed. Where there
is a bona fide
dispute as to either a question of fact or of law, certainty cannot
be said to
exist. In such cases there is room for mutual concession. The
adequacy of the
concession or consideration sufficient to justify the acceptance of
an offer of
compromise [99] is to be determined by the exercise of sound
discretion. The
opinion, therefore, should not be so construed as to preclude
compromise
settlement of such cases.
There appears to be no statutory authority to compromise
solely upon the
ground that a hard case is presented, which excites sympathy or is
merely
appealing from the standpoint of equity, but the power to
compromise clearly
authorizes the settlement of any case about which uncertainty
exists as to
liability or collection. Thus interpreted the opinion of October
24, 1933, will,
I believe, enable you to determine whether the cases summarized in
your letter
of January 30, 1934, fall within or without its purview.
It should, also, be observed that the questions specifically
considered in
that opinion related only to the power to compromise conferred by
Section 3469
of the Revised Statutes upon the Secretary of the Treasury and by
Section 3229
upon the Commissioner of Internal Revenue. In cases referred to
the Department
of Justice, whatever powers were conferred by these Sections,
whether general or
special, broad or narrow, are now vested in the Attorney General by
virtue of
Section 5 of Executive Order No. 6166, of June 10, 1933. At the
same time it
should be observed that in no event was his prior and plenary power
thereby
curtailed.
This power is in part inherent, appertaining to the office,
and in part
derived from various statutes and decisions which need not be
quoted at length,
but I may point out that while their opinions have not always been
harmonious,
its exercise has long been asserted by my predecessors and upheld
by judicial
authority. Concerning it, Attorney General Taney said (2 Op. 486):
'An attorney conducting a suit for a party has, in
the absence
of that party, a right to discontinue it whenever, in his judgment,
the interest
of his client requires it to be done. If he abuses this power, he
is liable to
the client whom he injures. * * * An attorney of the United
States, except
insofar as his powers may be restrained by particular acts of
Congress, has the
same authority and control over the suits which he is conducting.
The public
interest and the principles of justice require that he should have
this power;
for, why should the public be put to the [100] expense of preparing
a suit for
trial, and procuring evidence, when the attorney knows that, on
principles of
law, it cannot be supported? Why should he be required, on behalf
of the United
States, to harass a defendant with a prosecution, which, pending
the suit, he
discovers to be unjust and groundless?'
Attorney General Griggs in an opinion (22 Op. 491, 494)
distinguishing
between the power of the Attorney General and that of the Secretary
of the
Treasury, as I now do, said:
'Nevertheless, it is advisable to add, under the
circumstances,
that the primary, broad, and general control by the Attorney
General of suits in
which the United States is interested, conferred by the statutes
and established
by decisions of the Supreme Court, of which the Confiscation Cases
(7 Wall.,
454), may be mentioned, fully authorizes such disposition of
pending litigation
of the Government, including the class of cases which embraces the
one before us,
as seems to him meet and proper. He exercises superintendence and
direction over
the United States attorneys and general supervision over
proceedings instituted
for the benefit of the United States, and to him is necessarily
intrusted, in the
exercise of his sound professional discretion and because of the
nature of the
subject, the determination of many questions of expediency and
propriety
affecting the continuance or dismissal of legal proceedings. (2
Op. 482, 486.)
He may absolutely dismiss or discontinue suit
s in which the Government is interested; a fortiori he may
terminate the same
upon terms, at any stage, by way of compromise or
settlement.'
In 23 Op. 507, Acting Attorney General Beck made the same
observation; and
in the case of New York v. New Jersey, 256 U. S. 296, the Supreme
Court held that
in view of the authority of the Attorney General to control and
conduct
litigation in which the United States is interested, it was within
his authority
to agree that the United States would retire from the case on the
terms stated
in the stipulation. Probably the leading cases on the subject are
the
Confiscation Cases, 74 U. S. 454 (1868); and United States v. San
Jacinto Tin
Company, 125 U. S. 273, [101] 284 (1888), but also equally emphatic
on the power
of the Attorney General are United States v. Throckmorton, 98 U. S.
61 (1878);In
re Neagle, 135 U. S. 1, 67 (1890); New York v. New Jersey, 256 U.
S. 296 (1921);
Kern River Company v. United States, 257 U. S. 147 (1921); and
Ponzi v.
Fessenden, 258 U. S. 254 (1921).
In the San Jacinto case the Court said:
'We are not insensible to the enormous power and its
capacity for
evil thus reposed in that department of the Government (Department
of Justice).
* * * But it has often been said that the fact that the exercise of
power may be
abused is no sufficient reason for denying its existence' * * *
[Interpolation
supplied].
See also Swift & Co. v. United States, 276 U. S. 311.
There are also many decisions of the lower courts dealing with
the same
subject, chief among which are United States v. Schumann, Fed. Case
No. 16, 235
(1866); Conner v. Cornell, 32 F. (2d) 581 (C. C. A. 8th) (1929);
Mars v.
McDougal, 40 F. (2d) 247 (C. C. A. 10th) (1930); Sutherland v.
International
Insurance Co. of New York, 43 F. (2d) 969 (C. C. A. 2d) (1930); and
in People v.
Finch Pruyn & Co., 202 N. Y. S. 582, (affirmed 238 N. Y. 584) it
was held that
the Attorney General of the State of New York, under the common
law, could
compromise a case in which the State of New York was interested.
'And although
it has been said that there is no common law of the United States,
it is still
quite true that when acts of Congress use words which are familiar
in the law of
England they are supposed to be used with reference to their
meaning in that
law.' San Jacinto Case, supra. See also the Attorney General v.
The Town of
Farnham in Surrey, Hardres 504 (1679); Rex v. Wilkes, Burrows 252
7, 2554, 2570 (1770); Rey. v. Allen, 5 L T. R. 636 (1862); The King
v. Austen,
9 Price 142. Further confirmation may be found in the well
established rule that
a power vested in a government officer carries with it necessarily
authority to
make that power effective, McGrain v. Daugherty, 273 U. S. 135,
173; In re
Neagle, 39 Fed. 833, 851; State v. Hildebrant, 93 Ohio State 1; 34
Op. 320, 326;
Opinion of May 22, 1934 (37 Op. 534), to the Secretary of War.
[102] His statutory authority begins with the Judiciary Act of
September
24, 1789 (c. 20, Sec. 35, 1 Stat. 92), includes the Act of June 22,
1870, c. 150,
16 Stat. 162, formally creating the Department of Justice, and is
extended by the
recent Economy Act of March 3, 1933 (c. 212, 47 Stat. 1489), as
amended, by the
Act of March 20, 1933, c. 3, 48 Stat. 8, further including, of
course, the powers
conferred by Sections 3469 and 3229, Revised Statutes, and
transferred to him by
Executive order.
Speaking of certain of his statutory powers, the Court of
Claims in Perry
v. United States, 28 C. Cls. 483, 491 (1893), said:
'These provisions are too comprehensive and too
specific to
leave any doubt that Congress intended to gather into the
Department of Justice,
under the supervision and control of the Attorney General, all the
litigation and
all the law business in which the United States are interested, *
* *.' [Italics
supplied.]
At the same time, I have no hesitation in declaring that it is
a power,
whether attaching to the office or conferred by statute or
Executive order, to
be exercised with wise discretion and resorted to only to promote
the
Government's best interest or to prevent flagrant injustice, but
that it is broad
and plenary may be asserted with equal assurance, and it attaches,
of course,
immediately upon the receipt of a case in the Department of
Justice, carrying
with it both civil and criminal features, if both exist, and any
other matter
germane to the case which the Attorney General may find it
necessary or proper
to consider before he invokes the aid of the courts; nor does it
end with the
entry of judgment, but embraces execution (United States v. Morris,
10 Wheat.
246).
It follows, therefore, that the authority and discretion of
the Attorney
General are not to be understood as involved in or restricted by
the opinion of
October 24, 1933, to which this letter should be regarded as
supplemental.
Respectfully,
HOMER CUMMINGS.
November 1998
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