32 C.F.R. PART 757—AFFIRMATIVE CLAIMS REGULATIONS
Title 32 - National Defense
Authority: 5 U.S.C. 301; 10 U.S.C. 939, 5013, and 5148; E.O. 11476, 3 CFR, 1969 Comp., p. 132; 32 CFR 700.206 and 700.1202.
Source: 57 FR 5072, Feb. 12, 1992, unless otherwise noted.
Subpart A describes how to assert, administer, and collect claims for damage to or loss or destruction of Government property through negligence or wrongful acts. (a) General. With the exception of MCRA claims, all affirmative claims for money or property in favor of the United States shall be processed in accordance with the Federal Claims Collection Act (31 U.S.C. 3711). Department of Defense Directive 5515.111 1 Copies may be obtained if needed, from the Commanding Officer, U.S. Naval Publications and Forms Center, 5801 Tabor Avenue, Philadelphia, PA 19120. (b) Statute of limitations. There is a 3-year statute of limitations on affirmative Government tort claims pursuant to 28 U.S.C. 2415(b). The regulations published in 4 CFR chapter II control the collection and settlement of affirmative claims. This section supplements the material contained in those regulations. Where this section conflicts with the materials and procedure published in 4 CFR chapter II, the latter controls. (a) Against responsible third parties for damage to government property, or the property of nonappropriated-fund activities. It should be noted, however, that as a general rule, the Government does not seek payment from servicemembers and Government employees for damages caused by their simple negligence. Exceptions to this general policy will be made when the incident involves aggravating circumstances. (b) For medical costs from third party payers in accordance with 10 U.S.C. 1095. These claims are asserted and collected by the medical treatment facilities under the coordination of benefits program. (c) For money paid or reimbursed by the government for damage to a rental car in accordance with the Joint Federal Travel Regulations (volume 1, paragraph U 3415–C and volume 2, paragraph C 2101–2). Collection action shall be taken against third parties liable in tort. Collection action shall not be taken against Government personnel who rented the vehicle. (d) Other claims. Any other claim for money or property in favor of the United States cognizable under the Federal Claims Collection Act not specifically listed above. (a) General. The controlling procedures for administrative collection of claims are established in 4 CFR part 102. (b) Officials authorized to pursue claims. The following officers are authorized to pursue and collect all affirmative claims in favor of the United States: (1) The Judge Advocate General; the Deputy Judge Advocate General; any Assistant Judge Advocate General; and the Deputy Assistant Judge Advocate General (Claims and Tort Litigation); and (2) Commanding officers of Naval Legal Service Offices and applicable Detachments, except Naval Legal Service Offices in countries where another service has single service responsibility in accordance with DOD Directive 5515.8.2 2 See footnote 1 to §757.2. (c) Dollar limitations. All of the officers listed in §757.5(b) are authorized to compromise and terminate collection action on affirmative claims of $20,000.00 or less. (d) Determining liability. Liability must be determined in accordance with the law of the place in which the damage occurred, including the applicable traffic laws, elements of tort, and possible defenses. (e) Assertion of a claim. (1) Assertion of the claim is accomplished by mailing to the tortfeasor a “Notice of Claim.” The notice is to be mailed certified mail, return receipt requested, and should include the following information: (i) Reference to the statutory right to collect; (ii) A demand for payment or restoration; (iii) A description of damage; (iv) The date and place of the incident; and (v) The name, phone number, and office address of the claims personnel to contact. (2) See also 4 CFR part 102. (f) Full payment. When a responsible party or insurer tenders full payment or a compromise settlement on a claim, the payment should be in the form of a check or money order made payable to the collection activity, such as the “Commanding Officer, Naval Legal Service Office, (Name).” The check or money order shall then be forwarded to the disbursing officer serving the collecting activity for deposit in accordance with the provisions of the Navy Comptroller Manual. (g) Installment payments. See 4 CFR 102.11 for specific procedures. In general, if the debtor is financially unable to pay the debt in one lump sum, an installment payment plan may be arranged. Installment payments will be required on a monthly basis and the size of payment must bear a reasonable relation to the size of the debt and the debtor's ability to pay. The installment agreements should specify payments of such size and frequency to liquidate the Government's claim in not more than 3 years. Installment payments of less than $50.00 per month should be accepted only if justified on the grounds of financial hardship or for some other reasonable cause. In all installment arrangements, a confession of judgment note setting out a repayment schedule should be executed. (h) Damage to nonappropriated-fund instrumentality (NAFI) property. Any amount collected for loss or damage to property of a NAFI shall be forwarded to the headquarters of the nonappropriated-fund activity for deposit with that activity. In those situations where the recovery involves damage to both NAFI-owned property and other Government property, e.g., destruction of an exchange building resulting in damage to both the building and the exchange-owned property inside, recovery for the exchange-owned property shall be forwarded to the NAFI. Recovery for building damage shall be deposited in accordance with §757.5(f) above. (i) Damage to industrial-commercial property. When a loss or cost of repair has been borne by an industrial-commercial activity, payment shall be deposited in the Navy Industrial Fund of the activity in accordance with the provisions of the Navy Comptroller Manual. When a claim is based on a loss or damage sustained by such an activity, a notation to this effect shall be included in any claim file forwarded to the Judge Advocate General. (j) Replacement in kind or repair. The responsible party, or insurer, may want to repair or replace in kind damaged property. The commanding officer or officer in charge of the activity sustaining the loss is authorized to accept repair or replacement if, in his discretion, it is considered to be in the best interests of the United States. (k) Release. The commanding officer or officer in charge is authorized to execute a release of the claim when all repairs have been completed to the Government's satisfaction, and when all repair bills have been paid. No prior approval from the Judge Advocate General is required for this procedure. If repair or replacement is made, a notation shall be made in any investigation or claims file. (a) Officials authorized to compromise claims. The officers identified in §757.5(b) may collect the full amount on all claims, and may compromise, execute releases or terminate collection action on all claims of $20,000.00 or less. Collection action may be terminated for the convenience of the Government if the tortfeasor cannot be located, is found to be judgment-proof, has denied liability, or has refused to respond to repeated correspondence concerning legal liability involving a small claim. A termination for the convenience of the Government is made after it is determined that the case does not warrant litigation or that it is not cost-effective to pursue recovery efforts. (b) Claims over $100,000.00. Claims in excess of $100,000.00 may not be compromised for less than the full amount or collection action terminated without approval from the Department of Justice (DOJ). (c) Notification. The Judge Advocate General shall be notified prior to all requests made to the DOJ to compromise, terminate collection, or referral for further collection action or litigation. (d) Litigation reports. Litigation reports prepared in accordance with 4 CFR part 103 shall be forwarded to the DOJ along with any case file forwarded for further collection action or litigation as required by the Federal Claims Collections Standards. Subpart B describes the assertion and collection of claims for medical care under the Medical Care Recovery Act (MCRA). The MCRA states that when the Federal Government provides treatment or pays for treatment of an individual who is injured or suffers a disease, the Government is authorized to recover the reasonable value of that treatment from any third party legally liable for the injury or disease. Medical Care Recovery Act, 42 U.S.C. 2651–2653 (1982). (a) JAG designees. (1) Primary responsibility for investigating, asserting, and collecting Department of the Navy (DON) MCRA claims and properly forwarding MCRA claims to other Federal departments or agencies rests with the following officers: (i) Commanding officers and officers in charge, Naval Legal Service Command (NLSC) activities, in their areas of geographic responsibility; (ii) Officer in charge, U.S. Sending State Office, Rome in his area of geographic responsibility. (2) JAG designees may assert and receive full payment on any MCRA claim. They may, however, agree to compromise or waive only claims for $40,000.00 or less. Claims in excess of $40,000.00 may be compromised or waived only with DOJ approval. Such claims will be forwarded to the Judge Advocate General in accordance with §757.6. See §757.7 for further discussion of waiver and compromise. (b) Navy Medical Treatment Facilities (MTF). (1) Naval MTF's are responsible for ensuring potential MCRA claims are brought to the attention of the appropriate NLSC activity or U.S. Sending State Office (USSSO). (2) The MTF reports all potential MCRA cases by forwarding a copy of the daily injury log entries and admissions records to the cognizant NLSC activity or USSSO within 7 days of treatment for which a third party may be liable. The NLSC activity or USSSO makes the determination of liability. (i) MTF computes the value of the care it provided on NAVJAG Form 5890/12. Rates used to compute this value are published annually in the (ii) Block 4 of NAVJAG Form 5890/12 requires a statement from the patient describing the circumstances of the injury or disease. (iii) An “interim” report is prepared for inpatients only. An interim report is prepared every 4 months until the patient is released, transferred or changed to an outpatient status. (iv) A “final” report is prepared for all patients when inpatient and outpatient treatment is completed or the patient's care is transferred to another facility. A narrative summary should accompany the final report in all cases involving inpatient care. In addition, the back side of NAVJAG Form 5890/12 is completed as part of the final report when the value of Federal Government care exceeds $1,000.00. (c) The Office of Medical and Dental Affairs (OMA). The office pays emergency civilian medical expenses incurred by active duty members. This office furnishes MCRA claims information to the NLSC activity or USSSO. The address is Bldg. 38H, U.S. Naval Training Center, Great Lakes, IL 60088–5200. (d) Civilian Health and Medical Program of the Uniformed Services (CHAMPUS) contractors. CHAMPUS contractors forward reports of payments in injury cases to the appropriate NLSC activity. Responsible JAG designees should, however, initiate regular contact with contractors within their geographic area to ensure all relevant cases have been reported. (e) Department of Justice (DOJ). Only the DOJ may authorize compromise or waiver of an MCRA claim in excess of $40,000.00; settle an MCRA claim which was previously forwarded by the DON to DOJ for action; or settle an MCRA claim in which the third party has filed a suit against the United States or the injured person as a result of the incident which caused the injury. (a) General. The DON asserts MCRA claims when medical care is furnished to Navy and Marine Corps active duty personnel, retirees, or their dependents, and third-party tort liability for the injury or disease exists. Claims are asserted when the injured party is treated in a military MTF or when the DON is responsible for reimbursing a non-Federal care provider. Claims for medical care furnished are also asserted using alternate theories of recovery if the MCRA does not apply. See §757.14(e). (b) Independent cause of action. The MCRA creates an independent cause of action for the United States. The Government can administratively assert and litigate MCRA claims in its own name and for its own benefit. Procedural defenses, such as a failure of the injured person to properly file and/or serve a complaint on the third party, that may prevent the injured person from recovering, do not prevent the United States from pursuing its own action to recover the value of medical treatment provided to the injured person. The right arises directly from the statute; the statutory reference to subrogation pertain only to one mode of enforcement. In creating an independent right in the Government, the Act prevents a release given by the injured person to a third party from affecting the Government's claim. (c) Liable parties. MCRA claims may be asserted against individuals, corporations, associations and non-Federal Government agencies subject to the limitations described in §757.15. (d) Reasonable value of medical care. The reasonable value of medical care provided to an injured person is determined: (1) By using the rates set by the Office of Management and Budget and published in the (2) By the actual amount paid by the Federal Government to non-Federal medical care providers. (e) Alternate Theories of Recovery. Often, recovery under the MCRA is not possible because no third-party tort liability exists. For example, if a member, retiree, or dependent is driving a vehicle and is injured in a single-car accident, there is no tortfeasor. State law, including insurance, workers' compensation, and uninsured motorist coverage provisions, determines the DON's right to recover in situations not covered by the MCRA. If, under the law where the injury occurred, the injured party is entitled to compensation for medical care received, usually the Federal Government may recover. The two most common alternate theories are described below. (1) Recovery may be possible under the injured party's automobile insurance policy. In most cases, the Federal Government should seek recovery as a third-party beneficiary under the medical payments or the underinsured/uninsured portion of the injured party's policy. The ability of the Federal Government to recover as a third-party beneficiary has been upheld in some states, while other states have taken the contrary position. (2) Recovery may also be possible under State workers' compensation laws. Case law in this area is still emerging, but in most jurisdictions, the United States stands in the position of a lien claimant for services rendered. In some cases, the MCRA or public policy considerations limit the DON's assertion of claims against apparent third-party tortfeasors. MCRA claims are not asserted against: (a) Federal Government agencies. Claims are not asserted against any department, agency or instrumentality of the United States. “Agency or instrumentality” includes self-insured, non-appropriated-fund activities but does not include private associations. (b) Injured servicemembers, dependents and employers of the United States. Claims are not asserted directly against a servicemember, the dependent of a servicemember, or an employee of the United States who is injured as a result of his willful or negligent acts. The United States does assert, however, against medical care and treatment insurance coverage the member, employee, or dependent might have. (c) Employers of merchant seamen. Claims are not asserted against the employer of a merchant seaman who receives Federal medical care under 42 U.S.C. 249. (d) Department of Veterans Affairs care for service-connected disability. Claims are not asserted for care provided to a veteran by the Department of Veterans Affairs when the care is for a service-connected disability. The United States will, however, claim for the reasonable value of care provided an individual before he is transferred to a Department of Veterans Affairs hospital. The responsible NLSC activity or USSSO will investigate potential MCRA claims against the following third parties and forward a copy of their claims file, along with recommendations on assertion, to the Judge Advocate General: (a) Certain Government contractors. JAG approval is required before asserting an MCRA claim against a Federal Government contractor when the contract provides that the contractor will be indemnified or held harmless by the Federal Government for tort liability. (b) Foreign Governments. JAG approval is required before asserting MCRA claims against foreign governments, their political subdivisions, Armed Forces members, or civilian employees. (c) U.S. personnel. JAG approval is required before asserting MCRA claims against U.S. servicemembers, their dependents and employees of the United States, or their dependents for injury to another person. (a) Federal. The United States, or the injured party on behalf of the United States, must file suit within 3 years after an MCRA action accrues. 28 U.S.C. 2415. Generally this is 3 years from the date of initial Federal treatment or Federal Government payment to a private care provider, whichever is first. (b) State. Some State statutes of limitations may also apply where recovery is based on authority such as workers' compensation statutes, no-fault insurance statutes, no-fault medical payments, or uninsured motorist provisions of insurance contracts. (a) Initial action by JAG designee. When advised of a potential MCRA claim, the JAG designee will determine the Federal agency or department responsible for investigating and asserting the claim. (1) When the DON has reimbursed a non-Federal provider for health care or when CHAMPUS has made payment for a Navy health care beneficiary, the DON will assert any resulting MCRA claim. (2) When care is provided in a Federal treatment facility, the status of the injured person will determine the agency which will assert a resulting MCRA claim. (i) Where Navy or Marine Corps members, retirees, or their dependents receive medical treatment from another Federal agency or department, the DON will usually assert any MCRA claim on behalf of the United States based on information provided by the treating agency or department. (ii) Similarly, where a Navy MTF provides care to personnel of another Federal agency or department, that other agency or department will usually assert any claim on behalf of the United States. (3) If the claim is not one which the DON should assert, the JAG designee will forward all available information to the appropriate department or agency. (4) If the claim is one which the DON should assert, the JAG designee will ensure an appropriate investigation into the circumstances underlying the claim is initiated and will provide notice to the injured party and all third parties who may be liable to the injured person and the United States under the MCRA. (b) Investigating the claim. While there is no prescribed form or content for investigating these claims, the claims file will contain sufficient information on which to base valuation, assertion, settlement, waiver, and/or compromise decisions. Usually the file will contain: (1) Identification of each person involved in the incident including name, address, occupation, and nature of involvement; (2) Police, social service, and other Federal, State and local agency reports on the incident; (3) Completed copies of NAVJAG Form 5890/123 3 See footnote 3 to §757.2. (4) Inpatient summaries and outpatients records of treatment of the involved injury in non-Federal facilities; (5) Documents reflecting Federal payment for non-Federal treatment of the injured person; (6) Calculations of the reasonable value of the Government's MCRA claim; (7) Itemized repair bills or estimates of repair of damaged Federal Government property; (8) Where an identified third-party tortfeasor is a uniformed servicemember or a U.S. employee, information and findings concerning that person's duty or scope of employment status at the time of the incident giving rise to the injury; (9) Where an identified third-party tortfeasor is a uniformed servicemember or a U.S. employee or the dependent of a uniformed service member or U.S. employee, information and findings concerning whether that individual was grossly negligent or willfully culpable and whether that individual had insurance coverage at the time of the incident giving rise to the injury; (10) Financial information on identified third-party tortfeasors including names and addresses of insurance carriers, insurance policy numbers, and extent of coverage; and (11) A statement whether the injured person or his attorney will protect the interests of the United States. (c) Claims forwarded to JAG or DOJ. In those cases where the file must be forwarded to JAG or DOJ, the file will also include: (1) A summary of the case which includes the circumstances of the incident which caused the injury, the source, extent and value of medical care provided and a brief of the applicable law on the liability of the third party; (2) Copies of all correspondence; and (3) Recommended disposition. (d) Request for assistance in conducting investigation. When an injury for which the DON may assert an MCRA claim occurs at a place where the DON does not have a command, unit, or activity conveniently located for conducting an inquiry into the circumstances underlying the injury, the NLSC activity or USSSO having responsibility for administering any resulting MCRA claim may request assistance from any other command, unit, or activity within the DOD. Such assistance may take the form of a complete inquiry into the circumstances underlying the incident or it may only cover part of the necessary inquiry and fact gathering. If a NLSC activity or USSSO receives a similar request from another command, unit or activity within the DOD, every effort should be made to honor the request. Assistance will normally be provided without reimbursement from the requesting service. (e) Notice of claim. (1) The JAG designee will assert appropriate MCRA claims by mailing, certified mail, return receipt requested, a notice of claim (SF 96) to identified third-party tortfeasors and their insurers, if known. Many insured tortfeasors fail to notify their insurance companies of incidents. This failure may be a breach of the cooperation clause in the policy and may be grounds for the insurer to refuse to defend the insured or be responsible for any liability. The United States, as a claimant, may preclude such an invocation by giving the requisite notification itself. The purpose of the insurance clause is satisified if the insurer receives actual notice of the incident, regardless of the informant. This notice should be mailed as soon as it reasonably appears an identified third party may be liable for the injuries to the injured person. It is not necessary or desirable to delay mailing this notice until the completion of the investigation convened to inquire into the circumstances underlying the incident causing the injury. The prompt assertion of the claim will ensure that the Government is named on the settlement draft. If the United States is not so named, and the claim has been asserted, the insurer settles at its own risk. (2) The JAG designee will also notify the injured person or his legal representative of the Government's interest in the value of the medical care provided by the United States. This notice will advise that: (i) The United States may be entitled to recover the reasonable value of medical care furnished or paid for by the Federal Government; (ii) The injured person is required to cooperate in the efforts of the United States to recover the reasonable value of medical care furnished or paid for by the Federal Government; (iii) The injured person is required to furnish a statement regarding the circumstances surrounding the care and treatment; (iv) The injured person may seek legal guidance concerning any possible claim for personal injury; (v) The injured person is required to furnish information concerning legal action brought against any individual involved in the incident and provide the name of counsel representing the parties to such an action; and (vi) The injured person should not execute a release or settle a claim arising from the incident causing the injury without first notifying the JAG designee. (f) Administering the claim. (1) After investigating and asserting the claim, the JAG designee will maintain contact with all parties, their legal representatives, and insurers. (2) An effort should be made to coordinate collection of the Federal Government's MCRA interest with the injured person's action to collect his own claim for damages. (i) Attorneys representing an injured person may be authorized to include the Federal Government's MCRA claim as an item of special damages with the injured person's claim or suit. (ii) An agreement that the Government's claim will be made a party of the injured person's action should be in writing and state that counsel fees will not be paid by the Government or computed on the basis of the Government's portion of recovery. (3) If the injured person is not bringing an action for damages or is refusing to include the Federal Government's MCRA interest, the JAG designee will pursue independent collection. The United States is specifically allowed to intervene or join in any action at law brought by or through the injured person against the liable third person or bring an original suit in its own name or in the name of the injured person. The JAG designee will ensure all parties are aware that the United States must be a party to all subsequent collection negotiation. (4) When the MCRA interests are not being represented by the injured person and independent collection efforts have failed, the JAG designee will request JAG to refer the claim to the DOJ for possible suit. In such cases, the JAG designee will forward the complete file to JAG in accordance with §§757.18 (b) and (c). (g) Access to DON records and information. (1) The medical records of the injured person will be released to the injured person or his legal representative upon request. This release will be without cost except in unusual circumstances. These records may not be released to anyone else outside the DON except in accordance with the provisions of the Privacy Act, 5 U.S.C. 552a. Usually such a release will require authorization from the injured individual or legal representative or an order from a court of competent jurisdiction. A clerk or attorney signed subpoena is not “an order from a court of competent jurisdiction.” (2) In appropriate cases, military health care providers who have examined or treated the injured person may be made available by their commands to testify regarding the medical care provided to the injured person. Requests for such testimony will be processed in accordance with DOD Directive 5405.2, 28 CFR part 725, and 32 CFR part 725, except when the injured party is asserting the Federal Government's MCRA claim as part of his action for damages. In that situation, the injured person or legal representative is considered also to be a representative of the United States and the foregoing regulations are not applicable. In such a case, the JAG designee may, if appropriate, request the command of an involved military health care provider to make the provider available for testimony on behalf of the injured person. (a) General. A JAG designee may authorize waiver or compromise of any MCRA claim under his authority which does not exceed $40,000.00. A third party's liability for medical costs to the United States arising from a particular incident will be considered as a single claim in determining whether the claim is more than $40,000.00 for the purpose of waiver and compromise. When the JAG designee considers waiver or compromise appropriate in a claim which exceeds $40,000.00, the claim file will be forwarded to JAG in accordance with §§757.18 (b) and (c). (b) Waiver. The JAG designee may waive the Federal Government's MCRA interest when a responsible third-party tortfeasor cannot be located, is judgment proof, or has refused to pay and litigation is not feasible. Waiver is also appropriate when, upon written request by the injured person or legal representative, it is determined that collection would cause undue hardship to the injured person. In assessing undue hardship, the following circumstances of the injured person should be considered: (1) Permanent disability or disfigurement; (2) Lost earning capacity; (3) Out-of-pocket expenses; (4) Financial status; (5) Disability, pension and similar benefits available; (6) Amount of settlement or award from third-party tortfeasor; and (7) Any other factors which objectively indicate fairness requires waiver. (c) Compromise. The JAG designee may, upon written request of the injured person or legal representative, compromise the Federal Government's MCRA interest using the criteria listed above. (a) Payment. The JAG designee may receive payment in part or in full for any claim for which he is responsible. Written acknowledgment of this receipt will be mailed to the party making payment and a copy of the acknowledgement kept in the claim file. (b) Release. The JAG designee will execute and deliver a release to third parties making full or compromised payment on the Federal Government's MCRA interest. A copy of the release will be kept in the claims file.
Title 32: National Defense
PART 757—AFFIRMATIVE CLAIMS REGULATIONS
Section Contents
§ 757.1 Scope of subpart A.
§ 757.2 Statutory authority.
§ 757.3 Regulatory authority.
§ 757.4 Claims that may be collected.
§ 757.5 Assertion of claims and collection procedures.
§ 757.6 Waiver, compromise, and referral of claims.
§§ 757.7-757.10 [Reserved]
§ 757.11 Scope of subpart B.
§ 757.12 Statutory authority.
§ 757.13 Responsibility for MCRA action.
§ 757.14 Claims asserted.
§ 757.15 Claims not asserted.
§ 757.16 Claims asserted only with JAG approval.
§ 757.17 Statute of limitations.
§ 757.18 Asserting the claim.
§ 757.19 Waiver and compromise.
§ 757.20 Receipt and release.
Subpart A—Property Damage Claims
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§ 757.1 Scope of subpart A.
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§ 757.2 Statutory authority.
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§ 757.3 Regulatory authority.
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§ 757.4 Claims that may be collected.
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§ 757.5 Assertion of claims and collection procedures.
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§ 757.6 Waiver, compromise, and referral of claims.
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§§ 757.7-757.10 [Reserved]
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Subpart B—Medical Care Recovery Act (MRCA) Claims
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§ 757.11 Scope of subpart B.
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§ 757.12 Statutory authority.
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§ 757.13 Responsibility for MCRA action.
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§ 757.14 Claims asserted.
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§ 757.15 Claims not asserted.
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§ 757.16 Claims asserted only with JAG approval.
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§ 757.17 Statute of limitations.
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§ 757.18 Asserting the claim.
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§ 757.19 Waiver and compromise.
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§ 757.20 Receipt and release.
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