Reynolds v. Army and Air Force Exchange Service

• Decision Date: 16 May 1988
• Docket Number: No. 88-1050,88-1050
• Citation: 846 F.2d 746
• Parties: Karen S. REYNOLDS, Plaintiff-Appellant, v. ARMY AND AIR FORCE EXCHANGE SERVICE, Defendant-Appellee.
• Court: U.S. Court of Appeals — Federal Circuit

Page 746

846 F.2d 746

Karen S. REYNOLDS, Plaintiff-Appellant, v. ARMY AND AIR FORCE EXCHANGE SERVICE, Defendant-Appellee.

No. 88-1050.

United States Court of Appeals, Federal Circuit.

May 16, 1988.

Richard B. Thomas, Thomas Law Firm, Minot, N.D., submitted for plaintiff-appellant. With him on the brief was Lynn C. Jordheim, Asst. U.S. Atty., Bismarck, N.D.

John E. Kosloske, Commercial Litigation Branch, Dept. of Justice, Washington, D.C., submitted for defendant-appellee. With him on the brief were Richard K. Willard, Asst. Atty. Gen., David M. Cohen, Director and Thomas W. Petersen, Asst. Director. Also on the brief were Thomas L. Strand, Lt. Colonel, USAF and C.W. Russell, Jr., Lt. Colonel, USAFR, Office of The Judge Advocate General, of counsel.

Before SMITH, BISSELL, and ARCHER, Circuit Judges.

BISSELL, Circuit Judge.

Karen S. Reynolds appeals from a judgment of the United States District Court for the District of North Dakota, No. A4-86-125 (June 30, 1987), granting the motion of the United States to dismiss for lack of subject matter jurisdiction. We vacate and remand.

BACKGROUND

Reynolds is an employee of the Army and Air Force Exchange Service (AAFES), a nonappropriated fund instrumentality of the United States government. Reynolds occupied the position of retail manager of the Air Base Exchange in Minot, North Dakota. In early 1985, the general manager of the North Central Army Exchange issued to Reynolds an advance notice of proposed separation from AAFES for falsifying price change vouchers, merchandise-in-transit schedules, attendance schedules, and for allowing and encouraging her subordinates to use compensation time instead of overtime. After Reynolds responded in writing to the proposed adverse action, the Pursuant to Chapter 3 of the Exchange Service Personnel Policies (ESPP), Army Regulation No. 60-21/Air Force Regulation No. 147-15 (Dec. 15, 1980), Reynolds appealed her separation. At the administrative hearing, the hearing examiner found that the evidence supported only the allegations that Reynolds had (1) allowed an employee to manipulate AAFES' vacation system, and (2) allowed and encouraged her subordinates to use compensation time rather than overtime. In recognition of Reynolds' eighteen years of commendable service, the examiner recommended a demotion instead of a separation. On April 1, 1986, the Vice Commander of AAFES adopted this recommendation, and demoted Reynolds to a grade 8, step 1 from her previous position of grade 10, step 3. Apparently in connection with her disciplinary actions, Reynolds was transferred eight days later to an AAFES installation at Leonard Wood, Missouri. Her family still resides in Minot, North Dakota.

final notice of separation for cause issued, effective on April 30, 1985.

Reynolds filed suit in the district court for back pay, reinstatement, and reassignment. In response, the government filed a motion to dismiss the complaint for lack of subject matter jurisdiction and attached to the motion a copy of the ESPP. Reynolds, with leave of court, filed an amended complaint seeking recovery of damages resulting from breach of contract. The district court concluded that it did not have subject matter jurisdiction pursuant to the Tucker Act because there was no evidence that Reynolds held her position pursuant to any contract of employment. Reynolds v. Army and Air Force Exchange Service, No. A4-86-125, slip op. at 12 (D.N.D. June 30, 1987). Thereafter, Reynolds appealed.

ISSUE

Whether the district court properly dismissed Reynolds' case for lack of Tucker Act jurisdiction based on submitted evidence.

DECISION

In reviewing the district court's judgment granting the government's motion to dismiss for lack of subject matter jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(1), we normally consider the facts alleged in the complaint to be true and correct. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974); Air Prod. and Chems., Inc. v. Reichhold Chems., Inc., 755 F.2d 1559, 1562 n. 4, 225 USPQ 121, 123 n. 4 (Fed.Cir.), cert. dismissed, 473 U.S. 929, 106 S.Ct. 22, 87 L.Ed.2d 700 (1985). Because Reynolds' amended complaint alleged that she served pursuant to a contract, this allegation, left unchallenged, would be sufficient to support Tucker Act jurisdiction. 28 U.S.C. Sec. 1491 (1982); United States v. Hopkins, 427 U.S. 123, 130, 96 S.Ct. 2508, 2512, 49 L.Ed.2d 361 (1976) (Tucker Act covers employees of AAFES with contracts of employment, but does not cover appointed employees).

If a motion to dismiss for lack of subject matter jurisdiction, however, challenges the truth of the jurisdictional facts alleged in the complaint, the district court may consider relevant evidence in order to resolve the factual dispute. Land v. Dollar, 330 U.S. 731, 735, 67 S.Ct. 1009, 1010, 91 L.Ed. 1209 (1947); Zunamon v. Brown, 418 F.2d 883, 886 (8th Cir.1969); 2A J. Moore, J. Lucas & G. Grotheer, Moore's Federal Practice, p 12.07 [2.--1] at 12-46 to 12-47 (2d ed. 1987). This is such a case. Specifically, the government disputed Reynolds' allegation that she served under contract.

...