Appealed from: Merit Systems Protection Board.
Newman, Circuit Judge, Baldwin, Senior Circuit Judge and Mayer Circuit Judge.
BALDWIN, Senior Circuit Judge
Anthony A. Greco (petitioner) appeals from the final decision of the Merit Systems Protection Board (board), Nos. DC075283 A. 9033 and DC075283 A. 9012, denying his motion for attorney fees incurred during compliance proceedings. We affirm-in-part, reverse-in-part, and remand for a determination of the amounts to which petitioner is entitled.
In 1983 petitioner was removed for misconduct from his position with the Department of the Army (respondent). The removal was appealed to the board, but the case was settled before the board heard the appeal. The board approved the settlement agreement in June of 1983. As the board then noted, the agreement provided, "[i]n essence, * * * for cancellation of the removal action," and granted petitioner, inter alia, back pay, leave, retirement and other entitlements he would have earned during the period covered by the personnel action, as well as travel and storage reimbursements, specified performance ratings, registration in the Department of Defense (DOD) priority placement program, assistance in the sale of his automobile, and, most important for our purposes, payment of "reasonable attorneys' fees and expenses under [5 C.F.R.] § 1201.37(a)." Petitioner filed, and the board approved, a motion for attorney fees totalling over $20,000.00. That motion included fees through petitioner's appeal of the removal action.
In January 1984 petitioner filed a petition for enforcement, alleging that respondent had failed to comply with the agreement by not providing him the relief specified in paragraphs 1 (payment of living quarters allowance (LQA) and per diem), 3 (registration in the DOD priority placement program), 5, 6, and 9 (when it effectively reduced him from GS-13 to GS-12), and 10 (failing to provide legal assistance in his car sale). Petitioner also alleged that respondent's failure to comply with the agreement was in reprisal for petitioner's legal actions.
Petitioner requested a hearing on the enforcement petition. The administrative judge, without a hearing, held against petitioner on all of his allegations. On appeal, the board reversed and remanded the case for a hearing. On remand all of petitioner's allegations were again rejected, this time after a hearing.*fn1 The administrative judge's decision was again appealed. This time the board, after receipt of an advisory opinion from the General Accounting Office on the propriety of petitioner's LQA claim, found respondent failed to comply with the agreement with respect to LQA, and upheld the administrative judge's decision on the remaining claims. Respondent subsequently paid petitioner approximately $6,700.00 in LQA.
Petitioner now seeks attorney fees incurred during the compliance proceedings. The board rejected this latest effort in an opinion dated July 26, 1986.*fn2 The board rejected petitioner's assertion that the settlement agreement covered the compliance proceedings, stating that it is unreasonable "to find a provision of an agreement made at the time of settlement controlling over all future proceedings on the case." Init. Dec. at 2. The board then considered petitioner's motion under 5 U.S.C. § 7701(g)'s "interest of justice" standard, and the nonexclusive criteria set forth in Allen v. United States Postal Service, 2 M.S.P.B. 582 (1980), recognized by this court in Sterner v. Department of the Army, 711 F.2d 1563, 1568 (Fed. Cir. 1983). The board found petitioner to be the prevailing party, but found that payment of attorney fees was not warranted in the interest of justice, and thus denied petitioner's motion.*fn3 Petitioner appeals from that decision.
The issue before us is whether the settlement agreement reasonably can be construed to cover payment of petitioner's attorney fees incurred during the compliance proceedings.
A. The relevant provisions of the settlement agreement provide:
11. The parties agree that appellant is entitled to reasonable attorneys fees and expenses under 1201.37(a) of the Board's rules, such payment to cover all efforts to defend against the proposed Notices of Removal dated 16 August 1982 and 21 January 1982 respectively as well as discovery and hearing preparation necessary to pursue appellant's claims before this Board. The Parties agree that the Board may ...