749 F.2d 281 (5th Cir. 1985), 83-4531, United States v. Garner

Docket Nº:83-4531.
Citation:749 F.2d 281
Party Name:UNITED STATES of America, Plaintiff-Appellant, v. L.J. GARNER and Tommie N. Garner, Defendants-Appellees.
Case Date:January 03, 1985
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

Page 281

749 F.2d 281 (5th Cir. 1985)

UNITED STATES of America, Plaintiff-Appellant,


L.J. GARNER and Tommie N. Garner, Defendants-Appellees.

No. 83-4531.

United States Court of Appeals, Fifth Circuit

January 3, 1985

Page 282

Glen H. Davidson, U.S. Atty., Oxford, Miss., Robert S. Greenspan, Susan Sleater, Peter R. Maier, Dept. of Justice, Civil Div., Washington, D.C., for plaintiff-appellant.

Isaiah Madison, Greenville, Miss., Ben T. Cole, II, Oxford, Miss., for defendants-appellees.

David Madway, Gideon Anders, Berkeley, Cal., for amicus curiae National Housing Law Project.

Appeal from the United States District Court for the Northern District of Mississippi.

Before WISDOM, RANDALL and JOLLY, Circuit Judges.

RANDALL, Circuit Judge:

The United States appeals from an order of the district court barring the government

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from proceeding with foreclosure on the property of L.J. and Tommie N. Garner until (1) the Secretary of Agriculture issues regulations providing for refinancing by the Farmers Home Administration of its own loans at least under certain unspecified circumstances and (2) the Farmers Home Administration considers whether its mortgage loan to the Garners qualifies for refinancing under such regulations. Because we find that the district court's order is not subject to interlocutory review, we dismiss this appeal for lack of subject matter jurisdiction.


On March 29, 1979, the Farmers Home Administration (FmHA) loaned L.J. and Tommie N. Garner (the Garners) 1 $24,300 for the purchase of residential property in Hollandale, Mississippi. In connection with the loan, the Garners executed a deed of trust giving the FmHA a security interest in the property and signed a promissory note setting forth the terms of the repayment obligations to the FmHA. The note contained a standard acceleration clause in case of default.

Soon after the purchase of the property, the Garners became delinquent in their loan payments. The last payment was made on August 6, 1979; by October, 1982, the Garners were in arrears in the amount of $8,575. The FmHA notified the Garners that they were in default and demanded payment. After the Garners failed to cure their default, the government obtained a nonjudicial foreclosure against the property and instituted an eviction action in district court. The district court dismissed the suit and set aside the nonjudicial foreclosure on the ground that the Garners had not waived their right to a judicial hearing prior to foreclosure. The government did not appeal from the district court's judgment.

On July 27, 1981, the government brought the instant action for judicial foreclosure and possession of the Garners' Hollandale property. In December of 1982, while the action was still pending, the Garners requested moratorium assistance from the FmHA. The FmHA denied this request on the ground that, because the Garners' loan payment required less than 35% of their income, they were ineligible for a moratorium under FmHA regulations. See 7 C.F.R. Sec. 1951.313 (1984). Although the Garners were apprised of their right to an administrative appeal, none was taken.

Shortly before trial on March 4, 1983, the Garners, pursuant to 42 U.S.C. Sec. 1471(a), 2

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asked the FmHA to refinance their loan. The FmHA denied this request as well, stating that government regulations precluded it from refinancing its own loans. See 7 C.F.R. Sec. 1944.22(a) (1984). 3 At trial, the district court in an informal bench ruling found that the Garners' due process rights had been satisfied with respect to the judicial foreclosure proceeding and that the Garners had waived any right to a moratorium on repayment by failing to appeal the FmHA's denial of their moratorium request. The court thereupon stated that it was prepared to order foreclosure upon being satisfied that the FmHA lacked the authority to refinance the Garners' loan. The court accordingly withheld final judgment pending briefing on that issue by the parties.

On July 1, 1983, the district court in a memorandum opinion and order held that 42 U.S.C. Sec. 1471(a) imposed an imperative duty on the Secretary of Agriculture (Secretary) to promulgate regulations providing for FmHA refinancing of its own loans, at least in certain unspecified circumstances. United States v. Garner, 567 F.Supp. 313 (N.D.Miss.1983). The court, relying on Sec. 1471(a)'s legislative history, found that "the regulation [prohibiting the FmHA from refinancing its own loans] was not reasonably adopted, conflicts with the act of Congress under which it was promulgated, and cannot stand." Id. at 316. Based on this finding, the court barred the FmHA from proceeding with foreclosure until it considered the Garners' loan for refinancing under properly adopted regulations. The court also ordered the Garners to make payments into the court's registry in the amount of $150 per month as reasonable rent for the property until the FmHA considers their loan for refinancing. 4 The government appeals.


Federal courts of appeals are courts of limited jurisdiction. We have only that authority either endowed by the Constitution or conferred by Congress. As a result, we have the responsibility to examine sua sponte the basis of our own jurisdiction. That none of the parties has raised the jurisdictional issue, or even that all of the parties consent to the jurisdiction of the court, is, of course, irrelevant. Koke v. Phillips Petroleum Co., 730 F.2d 211, 214 (5th Cir.1984); Save the Bay, Inc. v. United States Army, 639 F.2d 1100, 1102 (5th Cir.1981). Accordingly, we address as a threshold matter whether the district court's order in this case is appealable.

Congress has vested the courts of appeals with "jurisdiction of appeals from all final decision of the district courts of the United States ... except where a direct review may be had in the Supreme Court." 28 U.S.C. Sec. 1291. This requirement of finality has been called "an historic characteristic of federal appellate procedure." Flanagan v. United States, --- U.S. ----, 104 S.Ct. 1051, 1054, 79 L.Ed.2d 288 (1984) (quoting Cobbledick v. United States, 309 U.S. 323, 324, 60 S.Ct. 540, 541, 84 L.Ed. 783 (1940)). The final judgment rule serves

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such important interests as preserving the respect due to trial judges by minimizing appellate court interference, reducing the ability of litigants to harass opponents, and keeping the courts unclogged by successions of costly and time-consuming appeals. Flanagan, supra, 104 S.Ct. at 1054; Firestone Tire & Rubber Co. v. Risjord, 449 U.S. 368, 374, 101 S.Ct. 669, 673, 66 L.Ed.2d 571 (1981). Thus, the Supreme Court has consistently held that as a general rule an order is final only when it "ends the litigation on the merits and leaves nothing for the court to do but execute the judgment." Firestone Tire & Rubber Co., supra, at 373, 101 S.Ct. at 673; Coopers & Lybrand v. Livesay, 437 U.S. 463, 467, 98 S.Ct. 2454, 2457, 57 L.Ed.2d 351 (1978); Catlin v. United States, 324 U.S. 229, 233, 65 S.Ct. 631, 633, 89 L.Ed. 911 (1945). See also Newpark Shipbuilding & Repair, Inc. v. Roundtree, 723 F.2d 399, 400 (5th Cir.1984) (en banc). Both Congress and the Supreme Court, however, as discussed below, have adopted several exceptions to this strict requirement of finality.

We apply first the general rule to the case at hand. Contrary to the government's contentions, the district court did not render an order technically final so as to require the government to make new factual averments in a new complaint before foreclosure could occur. Rather, the district court, instead of relinquishing jurisdiction over the case, suspended the proceedings until the government complied with its order. In its memorandum opinion, the district court made it quite clear that the government could continue with its foreclosure action once the refinancing regulations were issued and applied to the Garners' loan. See 567 F.Supp. at 316. Moreover, we do not agree with the government that the district court's order is tantamount as a practical matter to a final decision on the merits. If and when the government decides to comply with the court's order and promulgates refinancing regulations, the district court would still have to determine a number of issues before ordering foreclosure (if still sought by the government), not the least of which would be whether the new regulations are reasonable and consistent with congressional policy as previously described in the court's memorandum opinion. The mere possibility that the government may elect not to proceed with the foreclosure under the conditions established by the district court cannot, of course, render the order final. See Equal Employment Opportunity Comm'n v. Neches Butane Products Co., 704 F.2d 144, 147 (5th Cir.1983) (order requiring Commissioner to submit to discovery before proceeding with enforcement action is not final order under Sec. 1291 even in light of Commissioner's adamant refusal); United States v. Richardson, 204 F.2d 552, 555-56 (5th Cir.1953) (order requiring Secretary of the Army to appear for deposition before proceeding with condemnation action held not to be appealable order). In Richardson, the refusal to comply with the court's interlocutory order resulted in a stay that lasted for over thirteen years. United States v. 2,606.84 Acres of Land, 432 F.2d 1286, 1288 n. 2 (5th Cir.1970) (hearing on condemnation action finally held), cert. denied, 402 U.S. 916, 91 S.Ct. 1368, 28 L.Ed.2d 658 (1971). 5

Having determined that the court's order in the instant case constitutes merely a step toward final judgment and thus is unappealable in the ordinary sense of Sec. 1291, we turn to the various statutory and nonstatutory exceptions to the final judgment rule. We note at the outset though that the government failed to invoke one such...

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