U.S. GEOLOGICAL SURVEY WESTERN ECOLOGICAL RESOURCE CENTER - USGS-2013

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Ac-, A - -Zols November 7, 2013 From: U.S. Geological Survey Office of Western Regional Services U.S. Government Legal Provisions Concerning Liability (Bonding) and "Hold Harmless" agreements: Because of the peculiar nature of the United States Government, its employees and agents may act only in the manner set forth in statutory mandates. As a result, in several instances it is unable to "contract', or enter agreements in the conventional way. One such peculiarity is that an agency cannot enter into "hold harmless ", or "indemnity" agreements on behalf of the Government unless specifically authorized, since such an agreement would seem to amount to an agreement for an expenditure and /or liability which might arise in the future. This may be interpreted or construed as a commitment or obligation of funds prior to appropriation by Congress, which is prohibited by statute. (31 U. S. C. § 666; California Pacific Utilities Co. v. U. S., 194 Ct. Cl. 703 (1971)) Consequently, a substitute provision, set forth below, tailored to fit the Government's statutory restrictions, provides essentially the same protection a landowner would seek under a "hold harmless" agreement. It states that the Government promises to perform the work with all reasonable diligence and precaution. Failure to do so could be considered a breach of contract, which could be disposed of under the Tucker Act. (28 U. S. C. §1490) Also, the Federal Tort Claims Act (28 U. S. C. § 2671) provides a recourse against the Government for negligent acts or omissions of employees resulting in injury or damage. The Survey agrees that the (construction, installation, maintenance and use) of the (structures, appurtenances, equipment, and tools) on the lands (of the Landowner, lessee, etc.) on which they are (used or installed) shall be effected with all reasonable diligence and precaution to avoid damage to the and, property, or personnel of the (Landowner); further, the Government agrees to cooperate, to the extent allowed by law, in the submission of claims pursuant to the Federal Tort Claims Act against the United States by third parties for personal injury, or property damage resulting from the negligent act or omission of any employee of the Government in the course of his employment (28 U. S. C. §§ 2671, et seq.). Another aspect peculiar to the United States, is the question of insurance. Although in a sense the United States has been referred to as being "self insured ", it does not take out or carry liability insurance, but disposes of its liabilities under the Federal Tort Claims Act. It has been held that a government agency, absent specific statutory authority, cannot purchase insurance (19 Comp. Gen. 798). Thus, the United States cannot produce a certificate of insurance when requested: however, all proper claims will be disposed of under the Federal Tort Claims Act. In conjunction with this, the Government can require its contractor, if any, to provide a certificate of insurance to cover the contractor's activities during the course of a specific project. ;1i� r,iry IAttornE'.Y