American Samoa's last Fono session for the year ended without the Senate taking any action on the 6.6 million US dollar appropriation to pay the court ruling in favour of Progressive Insurance for losses in the Laufou Shopping Center fire.
The House approved the bill, which the administration submitted at the start of the last session after the High Court ordered that the government pay up.
The Senate's failure to vote on the bill means it is now dead.
When asked why the Senate had stalled the legislation, the Senate President Lolo Letalu Moliga said approving the bill would set a dangerous precedent.
He said the Senate anticipates that if the Progressive Insurance payment is approved, every building that is destroyed by fire from now on will result in a lawsuit against the government.
Lolo, who is nearing the end of his term as Senate President, said any appropriation bill approved by the Fono must have a funding source.
In the case of the 6.6 million dollar judgment, Lolo said the government didn't have any money to pay the ruling.
The government is appealing the Progressive Insurance judgment.