Maple Drive Farms Family Ltd. P'ship v. Vilsack

• Decision Date: 13 December 2012
• Docket Number: CASE NO. 1:11-CV-692
• Parties: MAPLE DRIVE FARMS FAMILY LIMITED PARTNERSHIP, and NICHOLAS H. SMITH, Plaintiffs, v. TOM VILSACK, SECRETARY, UNITED STATES DEPARTMENT OF AGRICULTURE, Defendant.
• Court: U.S. District Court — Western District of Michigan

MAPLE DRIVE FARMS FAMILY LIMITED PARTNERSHIP,
and NICHOLAS H. SMITH, Plaintiffs,
v.
TOM VILSACK, SECRETARY, UNITED STATES DEPARTMENT OF AGRICULTURE, Defendant.

CASE NO. 1:11-CV-692

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION

Dated: December 13, 2012

HON. ROBERT J. JONKER
OPINION

This matter is before the Court on challenges by Plaintiffs to two administrative decisions of the Defendant Secretary. The first is the Secretary's decision that Plaintiffs converted a wetland on their farm, in violation of the Swampbuster provisions of the Food Security Act, as amended, 16 U.S.C. § 3801 et seq. The second is the Secretary's decision to declare Plaintiffs ineligible for certain federal program benefits because of their conversion of a wetland. Both decisions are subject to judicial review under the Administrative Procedures Act (the "APA"). The familiar standards of administrative review apply: namely, the Court must sustain the Secretary's decisions if they were the product of a rational decisional process based on substantial evidence in the administrative record. Plaintiffs have also raised two contract claims apart from APA review, one seeking damages, the other seeking injunctive relief. Both contract theories rest on the same premise: namely, that the Secretary's decisions - even if supported by rational decision-making and substantial evidence - breach an enforceable contract between Plaintiffs and the Secretary. After reviewing all matters of

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record, and considering the parties' oral argument on the administrative review claims, the Court concludes that the Plaintiffs have not established any basis for judicial relief.

Facts

A Background

Plaintiff Maple Drive Farms Family Limited Partnership ("Maple Drive") owns farmland in Michigan, including without limitation the parcel of land (the "Parcel") at issue in this case. (Compl., docket # 1, at ¶ 2.) The Parcel comprises approximately 2.24 acres within a field Maple Drive owns in Hillsdale County (the "Maple Drive Property"). (Id. at ¶¶ 1, 19.) Plaintiffs describe the Parcel as a "localized depression surrounded by higher elevation land," with "bowl-like topography." (Id. at ¶ 22.) Plaintiffs note that the Parcel "tends to be wetter than adjacent lands." (Id.)

Plaintiff Nicholas Smith is a general partner of Maple Drive. (Id. at ¶ 3.) Mr. Smith farms land Maple Drive and Smith family members own, primarily raising corn, soybeans, and wheat. (Id. at ¶ 19.) Mr. Smith has been farming for over 50 years. (Id. at ¶ 20.) In November 1961, Mr. Smith entered a Soil and Water Conservation Plan (the "Conservation Plan") with an agency then known as Soil Conservation Services ("SCS"). (FSA A.R., docket # 30, at 309-28.)¹ Under the Conservation Plan, SCS assisted Mr. Smith with, among other things, the tile and drainage of certain areas of Smith family property in Hillsdale County, including the Parcel. (Id.) Mr. Smith, with cost-share funding from the agency now known as the FSA, installed drainage tile in the field containing

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the Parcel in 1964.² (NRCS A.R. 117.) The Parcel was drained and used to grow commodity crops at least through 1982. (docket # 35 at 9.) In the early 1980s, the drainage deteriorated. (Id.)

SCS and its successor organization, the Natural Resources Conservation Services (the "NRCS") provided technical assistance to Mr. Smith in implementing the Conservation Plan over approximately two decades. During that time, Plaintiffs did not have to comply with Highly Erodible Land ("HEL") and Wetland Conservation ("WC") provisions to receive USDA program benefits. That changed with the Food Security Act of 1985, as amended, which conditioned eligibility for USDA programs on compliance with HEL and WC requirements. 16 U.S.C. §§ 3811, 3821.

B. Wetland Determinations

On June 24, 1988, District Conservationist Dennis Haskins determined that a wetland existed on the Maple Drive Property, in the area of the Parcel. (NRCS A.R. 213-214.) On September 22, 1993, the District Conservationist again determined that a wetland existed on the Maple Drive Property, in the same area. (Id. at 186, 382.) Mr. Smith received notice of each of these determinations; he appealed neither of them. Years passed. Late in 2008, Mr. Smith executed a Form AD-1026, a "Highly Erodible Land Conservation and Wetland Conservation Certification," concerning the Maple Drive Property. (Id. at 204.) On the Form AD-1026, Mr. Smith certified that he intended to "plant an agricultural commodity on land for which a highly erodible determination has not been made" and to "create new drainage systems, or conduct land leveling, filling, dredging, land clearing, or stump removal, that has not been evaluated by NRCS." (Id.) He authorized the NRCS to conduct a wetland determination on the Maple Drive Property. (Id.)

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Jason Wheeler of the NRCS carried out the wetland determination. (Id. at 207.) In making the determination, Mr. Wheeler considered, without limitation, a soils map, and aerial images of the Maple Drive Property spanning 1979 through 2005. (Id. at 218-42.) On November 1, 2008, Mr. Smith received notice that the NRCS had determined preliminarily that the Parcel was a Wetland, and notice of his appeal rights. (Id. at 207-12.) On November 14, 2008, Mr. Smith appealed by requesting a reconsideration of the preliminary wetland determination and requesting mediation on the issue. (Id. at 245, 259.)

Mr. Wheeler visited the Maple Drive Property on November 4, 2008 and photographed the area, including the Parcel. (Id. at 243-44.) In response to Mr. Smith's request for reconsideration, the NRCS completed an on-site wetland investigation on November 25, 2008. (Id. at 246 -58.) In this on-site inspection, the NRCS identified two separate transect locations. (Id. at 116.) At the first transect point, the NRCS noted the existence of "normal circumstances . . . with no significant disturbances or potential problem," as well as "the conditions of a wetland: 1) hydrophytic vegetation, . . . 2) hydrology (water at 4 inches of depth and at soil surface within 15 feet of hand dug site), 3) hydric soils." (Id.) At the second transect point, the NRCS again noted normal circumstances with no significant disturbances or potential problems and found wetland conditions, including "1) hydrophytic vegetation . . . , 2) hydrology 3) hydric soils." (Id.) On December 12, 2008, NRCS concluded in light of the investigator's report that the Parcel was a Manipulated Wetland. (Id. at 257-58.)

Meanwhile, mediation between Mr. Smith and the NRCS continued. On January 28, 2009, Mr. Smith and the NRCS executed a Mediation Agreement. (Id. at 262.) The Mediation Agreement states, among other things, that Mr. Smith requests a wetlands delineation for the Maple Drive

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Property; that NRCS agrees to provide the wetlands delineation and to provide advance notice to Mr. Smith of the time and date of the NRCS site visit so that Mr. Smith may attend; and that the Maple Drive Property "can be planted this spring as long as no trees are removed." (Id. at 262.) The Mediation Agreement also provides that mediation will remain open for sixty days after the delineation. (Id.) It is undisputed that NRCS, through a conversation Jason Wheeler had with Mr. Smith, later told Mr. Smith that he could cut trees down as long as the tree stumps remained in place. (Id. at 461.)

In May of 2009, Mr. Smith removed trunks and limbs of woody vegetation in the Parcel, leaving stumps in place. (docket # 35 at 12.) He also leveled a ditch in the northern part of the Parcel, an area sometimes referred to as the "northern neck" part of the Parcel. (Id.) He replaced and leveled spoils previously excavated from the northern neck area and planted the Parcel with corn. (Id.) It is undisputed that Mr. Smith leveled, filled, and planted the Parcel. According to Mr. Smith, he did not believe the northern neck was wetland. (Id.)

On March 23, 2009, the NRCS notified Mr. Smith that it planned to conduct the on-site wetland delineation on April 7, 2009, and that the State Soil Scientist, State Biologist, District Conservationist, and Michigan's NRCS State Appeals Coordinator would all participate. (NRCS A.R. at 264.) Mr. Smith replied that he would not be available that day and requested a date after June 21 instead. (Id. at 265.) The NRCS and Mr. Smith agreed to have the on-site delineation on June 23. (Id. at 266.) The on-site visit occurred as planned, and the NRCS Final Technical Determination and notice to Mr. Smith issued approximately a month later, on July 24, 2009. (Id. at 301.) The Final Technical Determination concluded that the Parcel was a Converted Wetland. (Id.) The NRCS notice stated:

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Portions of the wetland area delineated have been significantly altered since the date of the reconsideration site visit on November 11, 2008.³ Because of these alterations, accurate delineation of the wetland was not possible. With the exception of some stumps from large trees that remain in the periphery of the wetland area, all woody vegetation within the wetland has been cleared and planted to a commodity crop. Additionally, there is evidence of the placement of fill in the north portion of the wetland, which has also been planted to a commodity crop . . . . Because the clearing of woody vegetation and placement of fill had the

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