as a rule, until he is out in civilian life for 2 or 3 years and is raising his family just what a penalty he has. I think an undesirable discharge or BCD is just as bad as 5 years in prison as far as the severity of the penalty is concerned. So, I do not think they should be given, except as a result of a court-martial.

Mr. FLOOD. Has that been indicated to the legislative committee by any of your people?

Judge QUINN. Yes, sir, it has, and I will indicate it to the Armed Services Committee if and when I testify before them. But, it has already been communicated to them by our Chief Commissioner and some others of our staff.

Mr. FLOOD. Is not Mr. Doyle, of California, interested in this?

Judge QUINN. Very much so. I think there were 51 bills introduced with that basic idea of preventing undesirable discharges without the right to a court-martial. As I say, if an individual is fully aware of his rights and if he is advised by a lawyer as to what his rights are and still he wants to take an undesirable discharge in order to avoid a court-martial, I think that is all right, but otherwise I do not think that the military should have the power to give undesirable discharges.

Mr. FLOOD. That is all, Mr. Chairman.

Mr. RILEY. Judge Quinn, I want to add my appreciation to you and your court for the very fine job you are doing. Thank you very much for your presentation.

Judge QUINN. Thank you very much, Mr. Chairman. Thank you, gentlemen, I do hope you will come down. You are always welcome to visit us.

Mr. FLOOD. It is a good show.

MONDAY, MARCH 20, 1961.

CLAIMS, DEPARTMENT OF DEFENSE

WITNESSES

J. A. WYLIE, DIRECTOR OF BUDGET AND FINANCE, OFFICE OF THE SECRETARY OF DEFENSE

LT. COL. CARLISLE C. TAYLOR, CLAIMS LIAISON OFFICER, OFFICE OF THE JUDGE ADVOCATE GENERAL, DEPARTMENT OF THE ARMY

Mr. RILEY. The next item for the consideration of the committee is that entitled "Claims, Department of Defense," for which Mr. Wylie is the witness.

Do you have a statement for us, Mr. Wylie?

Mr. WYLIE. Yes, sir; Mr. Chairman, I have a statement.

Mr. RILEY. We would be glad to hear from you at this time.

GENERAL STATEMENT OF DIRECTOR OF BUDGET AND FINANCE

Mr. WYLIE. Mr. Chairman and members of the committee, it is a pleasure to appear again before your committee, this time for the purpose of discussing the fiscal year 1962 requirements for the appropriation "Claims, Department of Defense." This appropriation provides for the payment, as authorized by law, of all noncontractual claims against the Department of Defense. The appropriation request of $19 million for fiscal year 1962 represents the consolidated requirements of the Office of the Secretary of Defense and the Departments of the Army, Navy and Air Force for this purpose.

The various types of claims, for which provision has been made in this appropriation request, are grouped into four major categories, namely: personnel claims, tort claims, admiralty claims and other miscellaneous claims.

PERSONNEL CLAIMS

The personnel claims category includes (1) claims of military and civilian personnel for private property lost or damaged in the military service, (2) marine casualty claims, (3) repayments of erroneous collections, and (4) claims arising from the correction of military or naval records. It is estimated that the general category of personnel claims will require approximately $8.2 million, or 43.2 percent of the appropriation request in fiscal year 1962.

Slight increases for fiscal years 1961 and 1962 have been projected for military and civilian personnel claims under this category. These increases are due to the fact that more small claims are being presented now because of increased knowledge of the right to claim and simpler and more expeditious handling of claims by field paying authorities.

TORT CLAIMS

The tort claims category includes (1) cases arising under the Federal Tort Claims Act, (2) foreign claims, (3) claims due to noncombat activities, (4) compromise settlements by the Attorney General, (5) property damage claims against the Navy under the Property Damage Claims Act of 1919, and (6) claims arising from activities of the Army and Air National Guards. Approximately $10.2 million, or 53.7 percent of the appropriation request, is expected to be required for claims of these types during fiscal year 1962.

Prior to September 13, 1960, authority to pay Army and Air National Guard claims was contained only in the language of this appropriation permitting payment of claims not in excess of $1,000 for damage to or loss of private property incident to the operation of National Guard camps of instruction, either during the stay of units at such camps, or while en route thereto or therefrom. Under this limited authority 300 to 400 claims were paid annually at a cost of ap

proximately $25,000 to $30,000. The enactment of Public Law 86740 (32 U.S.C. 715), which became effective on September 13, 1960, requires the Secretaries of the Army and the Air Force to settle claims in amounts of not more than $5,000 for property losses, personal injuries or death caused by members of the Army and Air National Guards acting within the scope of their employment while engaged in training or duty, including drills, schools, instructions in small arms, field exercises, and required training, or otherwise incident to noncombat activities of the Army and Air National Guards.

When I appeared before the Deficiencies Subcommittee on February 15, 1961, requesting a supplemental claims appropriation for fiscal year 1961, I called attention to the increased number and cost of maneuver claims in foreign countries, particularly in Germany. I also reported that we are now receiving claims paid by the German Defense Cost Offices resulting from the Munich catastrophe last December. It is expected that approximately $1 million of the claims arising from that disaster will be presented for payment in fiscal year

1961.

Compromise settlements by the Attorney General are expected to require somewhat more for both fiscal year 1961 and fiscal year 1962. The average dollar value of compromise settlements in the past several years has been rising. This trend is presently being experienced in judgments and compromise settlements of personal injury and death cases throughout the United States. Both years will exceed the number and cost experienced in fiscal year 1960.

The other types of claims under the tort claims category for fiscal year 1962 are estimated at the same level as for fiscal year 1961 and approximately the same as last year.

ADMIRALTY CLAIMS

Admiralty claims include payments under authority of the Admiralty Claims Act and Maritime Claims Act for claims arising from marine accidents and incidents involving vessels of the military departments. Admiralty claims are expected to require approximately $580,000 in fiscal year 1962 or $15,000 less than the revised estimated current year cost. The fiscal year 1962 estimate makes no provision for claims which might arise from major collisions or other such contingencies involving amounts in excess of the average admiralty claim.

OTHER MISCELLANEOUS CLAIMS

The other miscellaneous claims category includes amounts for (1) the indemnification of the Post Office Department for funds embezzled or for claims arising from error, loss, or defalcation by unbonded mail clerks and commissioned officers and (2) for claims for damages, arising under training contracts with carriers, caused by the negligence of military trainees in accordance with the provisions of agreements whereby military personnel are trained by carriers at no expense to the Government. It is estimated that $40,000 will provide for such purposes in fiscal year 1962.

In developing this appropriation request for fiscal year 1962 consideration was given to a variety of factors and indicators which can be used to approximate requirements of the claims appropriation.

These included an analysis of pending cases, reports on accidents and losses, the overall size of the Armed Forces and their deployment, and the number of maneuvers and training exercises. Each of these was considered in light of the fact that, while the average administrative claim is paid within a year from the date of occurrence, many of the pertinent statutes permit submission of a claim up to 2 years from the date of occurrence. Compromise settlements of large claims, such as admiralty and cases handled by the Attorney General, often require 4 to 6 years after the date of incident to effect final settlement.

In summary, the appropriation request of $19 million for fiscal year 1962 represents a conservative estimate of the requirements for all types of noncontractual claims against the Department of Defense. The estimate makes no provision for claims which might arise from major disasters or other unpredictable contingencies.

All payments made from this appropriation are authorized by various statutes governing the settlement of claims or by the language of this appropriation. Unobligated balances of this appropriation revert annually to the Treasury. All administrative and personnel costs required to process the claims under this appropriation are paid from the regular military pay and operations and maintenance appropriations of the military departments.

Mr. Chairman, I have Colonel Taylor here of the Department of the Army, who is thoroughly familiar with the laws and regulations concerning claims, and we would be glad to answer any questions at this time.

Mr. RILEY. Thank you, Mr. Wylie.

JUSTIFICATION OF THE ESTIMATE

At this point in the record we will insert pages 3, 4, 5, 9, 14, and 16 of the justifications.

(The pages referred to follow :)

1 A supplemental request for $6,000,000 will be submitted for inclusion in the next supplemental appropriation bill to be considered by Congress.

This appropriation provides for the payment of all noncontractual claims against the Department of Defense as authorized by law and represents the consolidated requirements of the Office of the Secretary of Defense and the Departments of the Army, Navy, and Air Force.

NOTE.-Amount shown in the estimates for fiscal year 1961 includes supplemental requests of $6,000,000.

This category includes

(1) Payments by the Department of the Navy, under authority of the Admiralty Claims Act (10 U.S.C. 7622), for personal injury or death or property damage caused by vessels of the Navy or in the naval service and