N002662
State of Connecticut
Hartford
January 18, 2002
Kenneth L. Zwick, Director
Office of Management Programs
Civil Division
United States Department of Justice
Main Building, Room 3140
950 Pennsylvania Avenue NW Washington, D.C. 20530
Dear Director Zwick:
I am submitting the following comments on the proposed Interim Rule concerning the September
11th
Victim Compensation Fund of 2001.
I appreciate the significant challenges faced by the Department of Justice in drafting the Interim
Rule
concerning the implementation of the September 11the Victim Compensation Fund of 2001.
Although I
am in general agreement with many of the provisions of the Interim Rule, I believe that in
fairness to all
victims fo the September 11th attack, and in accordance of the intent of Public Law 107-42,
some of
the provisions should be changed.
Section 104.2 of the Interim Rule establishes certain criteria for determining who may be eligible
for
compensation from the Fund. One criterion requires that the victim suffer physical harm in the
attack.
Physical harm is defined as: "a physical injury to the body that was treated by a medical
professional
within 24 hours of the injury having been sustained or within 24 hours of rescue; and (i)
Required
hospitalization as an inpatient for at least 24 hours; or (ii) Caused, either temporarily or
permanently,
partial or total physical disability, incapacity or disfigurement." While I recognize the difficulty
of
defining "physical injury" for the purposes of recovery from the Fund, I believe that the definition
chosen
is too narrow and would fail to account for those who suffered physical injuries deserving
compensation
but are unable to satisfy the temporal threshold. There may be circumstances where a person was
not
treated within 24 hours of rescue or injury due to the confusion existing at that time, and yet
required a
24 hour hospitalization or incurred a documented disability, incapacity or disfigurement. I urge
you to
amend this section to give a claimant an opportunity to provide evidence of physical injury
regardless of
when the initial treatment occurred, provided medical documentation can be provided.
Establishment of
a documented physical injury caused by the attack, and the provisions linking the amount of
compensation to the seriousness of injury, ensures a just, equitable award regardless of when the
initial
treatment was given.
Section 104.41 of the Interim Rule establishes the minimum level of compensation from the
Fund to be
no less than $500,000 for a decedent with a spouse and/or children and $300,000 for a decedent
with
no family prior to set-offs. I appreciate the difficulty in determining a just level of minimum
award.
However, there was significant, persuasive public comment concerning the minimum level of
compensation. I urge you to reconsider and raise these levels in light of the concerns expressed
by
victims and victim families, and make them at least commensurate with existing tort awards for
serious
injury of death.
I also urge you to consider establishing a minimum award net of all collateral sources. I
understand the
statutory language requires an offset of collateral sources including life insurance, pension funds
and
death benefit programs. However, such collateral should not completely offset an entire award. It
is
unfair for family members of a decedent or a seriously injured individual to be completely
uncompensated from the Fund for their loss. It is very rare for a tort judgment to be completely
offset
by an insurance award, as it is unjust for the negligent party to escape liability for damages
simply
because the victim was astute enough to carry significant life or health insurance. In this instance,
the
Fund stands in the shoes of the negligent party-because the victim foregoes the right to seek
compensation in a civil action against potentially liable parties-and so the Fund should provide
some
minimum benefit where collateral sources will completely offset the award.
There are two other issues concerning collateral sources that should be clarified in the final rule.
First, if
a collateral source such as life insurance is used as an offset, the offset amount should be reduced
by
any premiums paid by the decedent. Second, the final rule should ensure that a collateral source
such as
life insurance is only used as an offset if the eligible claimant is a beneficiary of the collateral
source. For
example, the decedent may have a life insurance policy where the spouse is the beneficiary but
the
eligible claimant is the mother of the decedent. In this example, the mother's claim should not be
offset
by the life insurance carried by the decedent.
Section 104.47 of the Interim Rule, which concerns donations from private charities, is vague,
confusing
and, depending upon how it is applied, will potentially frustrate the purpose of the Fund.
Section 104.47 (b)(2) begins with the broad statement that donations distributed to claimants by
private charitable entities do not constitute collateral source compensation. However, it then goes
on to
provide "that the Special Master may determine that funds provided to victims or their families
through
a private charitable entity constitute, in substance, a [collateral source compensation]." On its
face, the
rule seems self-contradictory and arbitrary; that is, distributions from charities will not be
considered
collateral compensation unless the Special Master thinks otherwise. There are two potentially
devastating
consequences to such a rule.
First, as Part E of the Statement of the Special Master acknowledges (66 Fed. Reg. 66279), the
rule
will have the perverse effect of encouraging charities to withhold their distributions until after
claimants
have received their award for the Fund. Some charities have been criticized for not distributing
quickly
enough the donations made by millions of compassionate Americans. The Rule should not
exacerbate,
or indeed encourage, this already unfortunate situation.
Second, the Rule provides no guidance as to when a distribution from a charity will or will not be
considered a collateral source payment. This lack of a clear, bright line test could lead to arbitrary
decisions, in which victims and their families will be treated differently even though their factual
circumstances are similar.
If, contrary to the above interpretation of 104.47 (b)(2), the intent of the Rule is that only pension
funds
and death benefits received by virtue of the claimant's employment with a charity will be
considered as
collateral source compensation, then the Rule should be amended to so state that precisely. In its
present form, such an intent is far from clear.
In short, the Rule should clearly, completely and definitively exclude voluntary, charitable
contributions
from being considered as collateral source compensation. This rule would be consistent with the
collateral source law in many other states, including Connecticut, New York, California, and
Massachusetts, to name a few, that do not include charitable funds from offsetting civil awards.
Section 104.52 provides that the distribution of the award should be in the manner consistent
with the
law of the state of the decedent's domicile. The Rule's comments seem to leave the decision on
distribution to the personal representative of the victim. However, the Rule also provides for the
Special
Master to direct payments when the Special Master does not feel the Personal Representatives's
plan
"appropriately compensates the victim's spouse, children or other relatives." The Rule should
clarify that
eligible dependents are defined in accordance with state law. The Rule should delete the
reference to
"spouse, children or other relatives" and insert "eligible dependents under state law." The current
reference seems to limit those eligible for an award to a spouse, children or blood relative. Over
the
years, our concept of family has been extended to include not only spouses and blood relatives. In
some instances, there is a person whose relationship with the victim has not been consummated
by
marriage but may be recognized under state law as being eligible for an award. The Rule should
not
exclude these individuals.
Very truly yours,
Comment by:
Richard Blumenthal
Attorney General for the
State of Connecticut
Hartford, Connecticut