Denial of Relief from Judgment on Unexpected Increased Cost of Care


Kenzora v. HHS, (Fed. Cl. Spec. Mstr. Sep. 25, 2015) (Dorsey, CSM)

A transverse myelitis case had been compensated in 2013, and provided for an annuity payment of $6000 per month for 5 years, life contingent, increasing at 3% compounded annually.  In 2015, Petitioner filed a Motion for Relief from Judgment, asserting that his monthly nursing facility charge was much higher than expected and that the monthly annuity payment was insufficient to cover the cost. Petitioner requested that the court liquidate or modify the annuity so as to enable petitioner to qualify for Medicaid.

The Court considered the applicable rule, Rule 60(b), noting that the first three grounds to set aside a judgment did not apply, as they must be raised within one year.  Petitioner requested that the court grant relief from the judgment pursuant to Rule 60(b)(5) and (6) on the respective grounds that “changed circumstances have made the prospective application of the judgment no longer equitable” and that the “substantial rights of the petitioner will be harmed” if not granted.

The Court held that the fact that the annuity does not fully cover petitioner’s nursing facility costs is not a circumstance that makes “the prospective application of the judgment no longer equitable” within the meaning of Rule 60(b)(5); that rule is meant to be read primarily in the context of injunctive relief, and judgments whose continuing effects are “‘executory’ or involve ‘the supervision of changing conduct or conditions.’”  Moreover, the court noted, the “changed circumstances” petitioner alleged were actually the result of an erroneous belief held by petitioner at the time he entered into the settlement—that the quoted nursing facility costs would remain fixed in the future.

The Court indicated that this misunderstanding might have been more appropriately brought under Rule 60(b)(1), which provides for relief in the case of “mistake,” however such a motion had to be brought within one year.

Nor would the court set aside the judgment under Rule 60(b)(6), because the rule must be construed narrowly in order to preserve the finality of judgments.  Thus, Rule 60(b)(6) does not relieve a party from a “free, calculated, and deliberate choice.”  Accordingly, relief is generally not available for ineffective assistance of counsel.

The Court also held that it lacked the authority to modify the judgment; the court could only set aside and vacate the settlement judgment entirely.  The court did observe that the Vaccine Act originally contained a provision for periodic adjustment of the award, but was amended in 1987 to delete that provision.

Finally, the Court pointed out that the stipulation provides that it is a complete integration of the parties’ agreement, and further notes that “a change in the nature of the injury or condition or in the items of compensation sought, is not grounds to modify or revise this agreement.”

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