33 CFR § 25.123 - Settlement and notice to claimant.

(a) If the settlement authority determines that the full amount claimed should be paid, the settlement authority forwards the claim to the disbursing officer for payment. If the time involved in settling the claim has been extensive, the settlement authority notifies the claimant.

(b) If the settlement authority determines that less than the full amount claimed should be paid, the settlement authority:

(1) Notifies the claimant in writing of the proposed settlement.

(2) Obtains from the claimant written acceptance and release for payment of the claim in the reduced amount.

(3) Advises the claimant, in the event claimant does not desire to accept the offer, to reply within 45 days giving reasons for rejection.

(4) Except upon a showing of good cause for delay in accepting a proposed settlement within 45 days, treats the non-acceptance as a rejection. Rejection by a claimant of an offer of settlement renders the offer void.

(5) If a claimant rejects a proposed settlement or fails to reply within 45 days, the settlement authority may make further efforts to settle the claim. When the settlement authority determines that further efforts to settle the claim are not warranted, the settlement authority notifies the claimant in writing by registered or certified mail, return receipt requested, that the claim has been denied because the amount claimed is excessive.

(c) If the claim is denied, the settlement authority notifies the claimant in writing by registered or certified mail, return receipt requested.