Attachment 7 October 14, 1952 Memorandum from Col. Ralapski, AFEB to Chief Legal Office, Re: Applicability of Section 5, Public Law 557-82d Congress, and related Memorandum from Col. Rapalski to the "Members of the Armed Forces Epidemiological Board; Directors of All Commissions." ARMED FORCES EPIDEMIOLOGICAL BOARD MEMORANDUM FOR: MEMBERS OF THE ARMED FORCES EPIDEMIOLOGICAL BOARD DIRECTORS OF ALL COMMISSIONS SUBJECT: Applicability of Section 5, Public Law 557 - 82nd Congress 1. As instructed by the Board at the Fall Meeting an inquiry was directed to the Chief of the Legal Office as to the applicability of Section 5, Public Law 557 - 82nd Congress in affording relief to the immediate dependents of prison volunteers. 2. The following reply has been received: "This law does not directly affect the prisoner or next-of-kin. This law is designed to indemnify contractors against any liability resulting from injury to persons or damage to property arising out of the direct performance of a research and development contract. The sense of Congress, as taken from the legislative history of this act, is as follows: 'Section 5 provides authority for the military departments to agree to indemnify contractors against liability and loss resulting from injury to persons or damage to property arising out of the direct performance of a research and development contract, to the extent that such losses are not compensated by Insurance or otherwise. In many cases, contractors are reluctant to undertake a research or development contract involving extremely hazardous new developments without securing adequate protection in the event of liability resulting from claims made as a result of damage from those experiments. No provision can be made for such protection by including a reserve in the contract price, and the cost of insurance, if at all obtainable, would be prohibitive. The solution is for the Government to agree to indemnify such a contractor, subject to the safeguards provided in this section.' From the wording of the law, and from the above quoted legislative history, it can be determined that this provision was aimed at private contractors as distinguished from Governmental agencies. It is aimed at _____ functions or experiments which are unusually hazardous for which the contractor cannot obtain liability insurance, and it is a direct indemnification to the contractor and not to the individual human guinea pig. The charge of claims, therefore, would be for the next-of-kin of the deceased person to make a claim against the contractor. In such an instance, the contractor is liable and, should he be forced by decision of court to pay on a judgment rendered in behalf of the next-of-kin, then, under the law the Government would reimburse the contractor for the amount of the judgment." COPIED: 11/30/94 RECORD Group: # 334 Entry: #13 File: 1 Applicability of Section 5, Public Law MEDDH 557 - 82nd Congress Chief, Legal Office Armed Forces Epidemiological 14 Oct 52 SGO Board Col Rapalski/65997 1. The Armed Forces Epidemiological Board has raised the question as to a practical problem in conjunction with Public Law 557 - 82nd Congress. Under its sponsorship, the Armed Services are supporting crucial medical research in which human volunteers in Federal and State prisons are involved. 2. The particular question that has been raised is whether Section 5 of the above cited Law is applicable to afford relief to the immediate dependents of such prisoner volunteers when as a result of these experiment they should die. 3. It is requested that information be furnished upon which to base a reply to the questions asked by the Board, and information as to how, if it is applicable, such provisions can be made in the contracts. FOR THE ARMED FORCES EPIDEMIOLOGICAL BOARD: Incl. ADAM J. RAPALSKI Cpy P.L. 557 Colonel, M. C. Administrator, Armed Forces Epidemiological Board COPIED: 11/30/94 RECORD Group: # 334 Entry: #13 File: (in box #1) 2 MEDDH Applicability of Section 5, Public Law 557 - 82nd Congress "The wording of the law indicates that the provisions of Section 5 would extend to prisoners and their next-of-kin. This can be deduced from the quoted part of the law as follows: 'With the approval of the Secretary concerned, any contract of the military departments for research and development * * * (1) Liability on accounts of claims * * * by third persons, including employees of the contractor, for death, * * *.'" "If a contract for such research were entered into by the Armed Forces with another Governmental agency, it would seem that there would be no need for a clause in the contract to indemnify the contractor. In this case, the contractor being another Governmental agency, the Government only would be liable. If such a contract were let to a private concern or establishment, then such a clause of indemnification would be entirely proper. In such an instance, a clause modeled in substance as follows, would be appropriate: 'It is hereby agreed that the Government will indemnify the said contractor against either or both of the following, to the extent that they arise out of the direct performance of said contract and are not compensated by insurance or otherwise: (1) Liability on account of claims (including reasonable expenses of litigation or settlement of such claims) by third persons, including employees of the said contractor, for death, bodily injury, or loss of or damage to property, arising as a result of a risk defined in the contract to be unusually hazardous: Provided, that the contractor shall immediately give notice to the Government of any suit or action filed or any claim made against the said contractor, with respect to any alleged liability for such death, bodily injury, or loss of or damage to property, and for control of or assistance in the defense of any such suit, action, or claim, by the Government, at its election; and (2) loss of or damage to property of the said contractor arising as a result of any risk defined in this contract to be unusually hazardous: And provided further, that no payment shall be made by the Government under the authority of Section 5, Public Law 557 - 82nd Congress, unless the amount thereof shall first have been certified to be just and reasonable by the Secretary concerned or by an official of the department designated for such purpose by the Secretary.'" 3. The Medical Research and Development Board, Office of the Surgeon General, Department of the Army, proposed to use the above clause, or one very similar to it, as soon as it is approved by The Judge Advocate General, in drawing up future contracts, and in modifying old contracts as they are renewed to include this added clause. FOR THE ARMED FORCES EPIDEMIOLOGICAL BOARD ADAM J. RAPALSKI Colonel, M. C. Administrator, Armed Forces Epidemiological Board COPIED: 11/30/94 RECORD GROUP: #334 ENTRY: #13 FILE: