[Code of Federal Regulations]
[Title 32, Volume 5]
[Revised as of July 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 32CFR751.30]

[Page 435-436]
 
                       TITLE 32--NATIONAL DEFENSE
 
                   CHAPTER VI--DEPARTMENT OF THE NAVY
 
PART 751_PERSONNEL CLAIMS REGULATIONS--Table of Contents
 
           Subpart B_Demand On Carrier, Contractor, or Insurer
 
Sec. 751.30  Settlement procedures and third party responses.

    (a) Settlement procedures. In the interest of expeditious office 
administration, correspondence to carriers and contractors should be 
kept to a minimum. Normally, one rebuttal to a third party's denial of 
liability is sufficient, unless the carrier or contractor raises new 
arguments or provides new information.
    (1) Checks from third parties. Accept checks for the amount demanded 
from

[[Page 436]]

carriers and contractors. If a carrier or contractor forwards a check 
for less than the amount demanded, review the carrier's arguments for 
reducing liability to determine if they are acceptable. If the third 
party's basis for reducing liability is acceptable in the light of all 
evidence, deposit the check and dispatch the unearned freight letter, if 
applicable. Mark the front upper left-hand corner of the file as 
``CLOSED.''
    (2) Third party offers of settlement. If a carrier or contractor 
offers to settle the claim, review the carrier's arguments for reducing 
liability to determine if they are acceptable. If the third party's 
basis for reducing liability is acceptable in light of all evidence, 
inform the carrier that the offer is accepted, but that offset action 
will be initiated if a check for that amount is not received within 45 
days. If a check in the amount acceptable to the Government is received, 
deposit it and dispatch the unearned freight letter, if applicable. Mark 
the front upper left-hand corner of the file as ``CLOSED.'' If a check 
in the proper amount is not received within 45 days, send the request to 
NAVMTO, Norfolk (or appropriate contract officer) for offset action (see 
Sec. 751.32 of this part).
    (3) Unacceptable third party checks and offers of settlement. If a 
third party's basis for denying liability is not valid, respond to that 
carrier or contractor. Return unacceptable checks. Explain the reasons 
for not accepting the check or offer, and request the amount that is 
justified under the circumstances in the light of all the evidence. If a 
release was included, amend the release to the revised amount and sign, 
date, witness, and return it. Warn the carrier or contractor that the 
claim will be forwarded for offset action if a check for the amount 
justified under the circumstances is not received within 45 days. 
Suspend the file for 45 days and if a check in the proper amount is 
received, deposit it and dispatch the unearned freight letter, if 
applicable. If a check in the proper amount is not received within 45 
days, request NAVMTO, Norfolk (or appropriate contract officer) to take 
offset action.
    (4) Third party denials of liability. Upon receipt, review the 
carrier or contractor's basis for denying liability in the light of all 
the evidence.
    (i) Acceptable third party reasons for denial. Mark the front upper 
left-hand corner of such files as ``CLOSED.''
    (ii) Partially acceptable and unacceptable third party reasons for 
denial. If the carrier or contractor's basis for denying liability is 
acceptable only in part or is completely unacceptable, follow the 
procedures in subparagraph (3) above, requesting the amount that is 
justified under the circumstances in the light of all the evidence. If a 
response is not received within 45 days, or if the third party's reply 
is not responsive, request NAVMTO, Norfolk (or appropriate contract 
officer) take offset action as described above.
    (b) Depreciation. In determining payments to claimants, the 
depreciation rates from the Allowance List--Depreciation Guide are used. 
In determining third party liability, however, a different depreciation 
guide, the Joint Military/Industry Depreciation Guide is used instead. 
In most instances, the depreciation rates are the same in both guides, 
and claims personnel are not required to consult the Joint Military/
Industry Depreciation Guide or alter the depreciation taken on items 
prior to dispatching demands. If, however, a carrier or contractor 
objects to the depreciation rate utilized for certain items, consult the 
Joint Military/Industry Depreciation Guide and use the depreciation rate 
found in that guide if it differs from the rate in the Allowance List-
Depreciation Guide.