Bender v. Clark

• Decision Date: 28 September 1984
• Docket Number: No. 83-1306,83-1306
• Citation: 744 F.2d 1424
• Parties: Jack J. BENDER, Plaintiff-Appellee, v. William P. CLARK, as Successor to James G. Watt, et al., Defendants-Appellants.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1424

744 F.2d 1424

Jack J. BENDER, Plaintiff-Appellee, v. William P. CLARK, as Successor to James G. Watt, et al Defendants-Appellants.

No. 83-1306.

United States Court of Appeals Tenth Circuit.

Sept. 28, 1984.

S. Kirk Ingebretsen, Denver, Colo. (David W. Furgason, Denver, Colo., with him on brief) of Welborn, Dufford & Brown, Denver, Colo., for plaintiff-appellee.

John A. Bryson, Atty., Dept. of Justice, Washington, D.C. (William Lutz, U.S. Atty. and Herbert A. Becker, Asst. U.S. Atty., Albuquerque, N.M., and Carol E. Dinkins, F. Henry Habicht, II, Asst. Attys. Gen., Raymond Zagone, Anne S. Almy, Martin Green, Attys., Dept. of Justice, Washington, D.C., with him on briefs), for defendants-appellants.

Before HOLLOWAY and BARRETT, Circuit Judges, and SETH, Chief Judge.

BARRETT, Circuit Judge.

The government appeals from an order of the district court which remanded the action to an administrative law judge (ALJ) for a determination of whether the plaintiff-appellee, Jack J. Bender, adequately showed by a preponderance of the evidence that the United States Geological Survey (USGS) erred in finding that a particular tract of federal land contained a known geologic structure (KGS). The district court had jurisdiction over this matter pursuant to 5 U.S.C. Secs. 702, 704 and 28 U.S.C. Sec. 1331.

In February, 1977, Bender filed a noncompetitive oil and gas lease offer for certain public lands in New Mexico. At the public drawing held in March, 1977, at the New Mexico State Office of the Bureau of Land Management (BLM), Bender's offer was accorded priority number one. Before the lease was issued, however, the USGS determined that the land in question was within an undefined KGS. Because 30 U.S.C. Sec. 226(b)(1) mandates that lands within a KGS be leased by competitive bidding only, the BLM rejected Bender's lease offer on July 13, 1977. Bender subsequently appealed the BLM's decision to the Interior Board of Land Appeals (IBLA).

Although an individual applicant in Bender's position is not statutorily entitled to a hearing on this particular administrative decision, the IBLA referred the case for a recommended decision to the Hearings Division, Office of Hearing and Appeals, pursuant to 43 C.F.R. Secs. 4.415 and 4.452-8(c) (1983). The IBLA specifically requested that a hearing examiner take evidence on the question of whether this land was properly included within a KGS. Jack J. Bender, 40 IBLA 26, 29 (1979). On August 15, 1979, a hearing was held before an ALJ after which the ALJ recommended that the BLM's decision be affirmed. After reviewing the evidence presented at the hearing, the IBLA concluded that (1) the government satisfied its burden of establishing a prima facie case of the existence of a KGS and (2) Bender failed to show by "clear and definite" evidence that the government erred in making this determination. Jack J. Bender, 54 IBLA 375, 385 and 389 (1981) (Bender II ).

Bender then sought judicial review of the IBLA's decision in federal district court, contending that the government failed to make a prima facie showing that the land was within a KGS and that the IBLA applied an improper standard of proof for him to meet in overcoming the government's decision. The district court found that although the government had established a prima facie case that the land was within a KGS, the IBLA erred legally in holding that Bender could overcome this finding only by "clear and definite evidence"; Bender need only show by a "preponderance of the evidence" that the government's determination was erroneous. Hence, the district court remanded the case to the ALJ to determine whether Bender established by a preponderance of the evidence that the KGS decision was incorrect.

On appeal, we are presented with two issues: (1) whether the remand order of the district court is a "final decision" pursuant to 28 U.S.C. Sec. 1291, vesting us with appellate jurisdiction over this matter; (2) if so, whether the district court erred in finding that the proper standard of proof in this instance is a preponderance of the evidence.

Appealability

Although the parties did not raise the jurisdictional issue, ¹ it is well established that we may raise such issues on our own motion. E.g., Treinies v. Sunshine Mining Co., 308 U.S. 66, 70, 60 S.Ct. 44, 47, 84 L.Ed. 85 (1939); Citizens Concerned v. City & Cty of Denver, 628 F.2d 1289, 1297 (10th Cir.1980), cert. denied, 452 U.S. 963, 101 S.Ct. 3114, 69 L.Ed.2d 975 (1981). Under the circumstances of this case, we are faced with a unique jurisdictional question which, as far as we can determine, has not been addressed previously by any federal circuit court. We must decide whether a remand order by a federal district court to an administrative agency, in which the agency is directed to apply a legal standard contrary to its usual standard, is a "final decision" within the meaning of 28 U.S.C. Sec. 1291.

The jurisdiction of United States Circuit Courts of Appeals is grounded in statute. Century Laminating, Ltd. v. Montgomery, 595 F.2d 563, 565 (10th Cir.1979), cert. dismissed, 444 U.S. 987, 100 S.Ct. 516, 62 L.Ed.2d 417 (1979). In the absence of a specific statutory grant of jurisdiction in a particular type of dispute, we nonetheless have jurisdiction over final decisions of the federal district courts pursuant to Sec. 1291. ² The purpose of the finality requirement is to avoid piecemeal review. Giordano v. Roudebush, 565 F.2d 1015, 1018 (8th Cir.1977). Generally, "[t]o be final and appealable, the district court's judgment must end the litigation and leave nothing to be done except execute the judgment." Matter of Glover, Inc., 697 F.2d 907, 909 (10th Cir.1983) (citing Catlin v. United States, 324 U.S. 229, 233, 65 S.Ct. 631, 633, 89 L.Ed. 911 (1945)). The remand by a district court to an administrative agency for further proceedings is ordinarily not appealable because it is not a final decision. Ringsby Truck Lines, Inc. v. United States, 490 F.2d 620, 624 (10th Cir.1973) cert. denied, 419 U.S. 833, 95 S.Ct. 59, 42 L.Ed.2d 59 (1974); Pauls v. Secretary of the Air Force, 457 F.2d 294, 297-98 (1st Cir.1972); 15 Wright, Miller & Cooper, Federal Practice and Procedure: Jurisdiction Sec. 3914, at 550-53 (1976). We have recognized, however, that this general proposition is not to be applied if it would violate basic judicial principles. See Ringsby Truck Lines, Inc. v. United States, supra at 624 (review is allowed where effect of the district court's remand order to the Interstate Commerce Commission would be "death knell" of the action).

The United States Supreme Court has held similarly that the finality requirement of Sec. 1291 must be applied practically rather than technically. Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 546, 69 S.Ct. 1221, 1225, 93 L.Ed. 1528 (1949). See also Paluso v. Mathews, 573 F.2d 4, 8 (10th Cir.1978). Thus, the Court in Cohen established what is now termed the "collateral order" doctrine. 15 Wright, Miller and Cooper, supra Sec. 3911, at 467. In Cohen, the Court held that a district court's refusal to order the plaintiff in a stockholder's derivative suit to post security for costs, as required by state statute, was immediately appealable. The Court's reasoning is vital:

This decision appears to fall in that small class which finally determine claims of right separable from, and collateral to, rights asserted in the action, too important to be denied review and too independent of the cause itself to require that appellate consideration be deferred until the whole case is adjudicated.

337 U.S. at 546, 69 S.Ct. at 1225.

The government maintains that the present dispute satisfies the Cohen exception to applying Sec. 1291 rigidly. We cannot hold, however, that the standard-of-proof issue decided by the district court is "separable from, and collateral to" the merits of the ultimate dispute. In Cohen, the Court stated that to be collateral, the matter raised on appeal must not be a step toward a final judgment in which it would "merge," it must not affect, nor be affected by, the decision of the merits, and it must be so independent of the action that appellate review need not await final disposition of the merits. Id. See also 15 Wright, Miller & Cooper, supra Sec. 3911, at 470. We conclude that under this standard, the issue decided by the district court is so intertwined with the ultimate factual determination to be made--the existence of a KGS--that it is not collateral to the merits of the dispute.

The practical application of Sec. 1291, however, must be viewed under the circumstances of each case. We believe that the underlying concern of the Court in Cohen was whether the appellate court, under the circumstances, could not in fairness delay immediate review. Indeed, the First Circuit has held that the underlying policy considerations in Cohen and the internal logic of the Supreme Court's criteria suggest that the dispositive concern in such a case is the need for urgent review. See In re Continental Investment Corp., 637 F.2d 1, 6 (1st Cir.1980) (Chapter X Bankruptcy reorganization proceeding). In our view, the Cohen Court asserted the need for the practical application of Sec. 1291 particularly in situations where it is clearly urgent that an important issue--one that is serious and unsettled, and not within the trial court's discretion (see 337 U.S. at 547, 69 S.Ct. at 1226)--be decided. Thus, in the unique instance where the issue is not "collateral" but justice may require immediate review, a balancing approach should be followed to make this jurisdictional decision.

The circumstances of the instant case require the application of such a balancing test rather than the mechanical analysis of the collateral order exception. The critical inquiry is whether the danger of injustice by delaying appellate review outweighs the inconvenience and costs of piecemeal review. Paluso v. Mathews, supra at 8. But see 15...