Merged Area X (Ed.) in Counties of Benton, Cedar, Iowa, Johnson, Jones, Linn and Washington, State of Iowa v. Cleland, 78-1757

• Citation: 604 F.2d 1075
• Decision Date: 01 August 1979
• Docket Number: No. 78-1757,78-1757
• Parties: CA 79-2883 MERGED AREA X (EDUCATION) IN the COUNTIES OF BENTON, CEDAR, IOWA, JOHNSON, JONES, LINN AND WASHINGTON, STATE OF IOWA, and Norman Carpenter, Appellees, v. Max CLELAND, Administrator, Veterans Administration, A. H. Thornton, Director, Education and Rehabilitation Service, Veterans Administration, and Robert L. Winters, Director, Veterans Administration Regional Office, Des Moines, Iowa, Appellants.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 1075

604 F.2d 1075

CA 79-2883 MERGED AREA X (EDUCATION) IN the COUNTIES OF BENTON, CEDAR, IOWA, JOHNSON, JONES, LINN AND WASHINGTON, STATE OF IOWA, and Norman Carpenter, Appellees, v. Max CLELAND, Administrator, Veterans Administration, A. H Thornton, Director, Education and Rehabilitation Service Veterans Administration, and Robert L. Winters, Director Veterans Administration Regional Office, Des Moines, Iowa, Appellants.

No. 78-1757.

United States Court of Appeals Eighth Circuit.

Submitted March 14, 1979.

Decided Aug. 1, 1979.

Judith Whetstine, Asst. U. S. Atty., Cedar Rapids, Iowa (argued), for appellants; by James H. Reynolds, U. S. Atty., Cedar Rapids, Iowa, on brief.

Mark H. Rettig, Hines, Pence, Day & Powers, Cedar Rapids, Iowa (argued), for appellees; Ernest F. Pence, Cedar Rapids, Iowa, on brief.

Slade Gorton, Atty. Gen., Richard M. Montecucco, Sr., Asst. Atty. Gen., Chief, Ed. Division, and Larry R. Schreiter, Asst. Atty. Gen., Olympia, Wash., amicus curiae.

Before GIBSON, Chief Judge, and ROSS and McMILLIAN, Circuit Judges.

McMILLIAN, Circuit Judge.

Appellant, Max Cleland, Administrator of the Veterans Administration (VA), appeals from a judgment of the district court holding that the VA does not have the statutory authority to promulgate Veterans Administration Regulation 14272(D), 38 C.F.R. § 21.4272(d) (1978); V.A. Regulation 14200(G), 38 C.F.R. § 21.4200(g) (1978); and Department of Veteran's Benefits (D.V.B.) Circular 20-77-16, dated Feb. 9, 1977, revised by change 1, Apr. 21, 1977 (see Appendix). For reversal appellant argues that (1) judicial review of the Veterans Administration Regulations is precluded by 38 U.S.C. § 211(a); (2) plaintiff-appellee, Merged Area X (Education) (hereinafter referred to as Kirkwood), has no standing in this case; and (3) the VA has statutory authority to promulgate the regulations in question. For the following reasons, we agree with the district court that judicial review is proper and that Kirkwood has standing, but we disagree with the district court's conclusion that the VA does not have statutory authority to promulgate the regulations. We reverse and remand accordingly.

There are two plaintiffs in this case, Kirkwood and Norman Carpenter. Kirkwood, located in Cedar Rapids, Iowa, is an accredited public institution of higher learning (IHL) which offers two years of instruction, fulfilling the requirements of an associate degree. Norman Carpenter is a full-time student at Kirkwood and has been enrolled in Kirkwood's non-traditional program since August, 1977. Carpenter is a veteran who stands to lose full-time veterans educational benefits if the VA regulations are allowed to stand and if he remains in Kirkwood's non-traditional program.

In order to receive full-time educational benefits, a veteran must be enrolled in a full-time academic program. The contested regulations define full-time academic program to be twelve "contact hours," or, twelve hours of time "in class per week for one quarter or one semester." In Kirkwood's non-traditional program, students pay full tuition and are enrolled for 3 classes of four hours each, for a total of twelve hours credit. However, they are in class only nine hours per week, making up the extra hours, one per class, with additional readings, written papers or special projects. The courses in the non-traditional program cover the same subject matter and utilize the same materials as those in the traditional education program but are designed to provide more flexibility to students who work full-time or for other reasons have scheduling problems.

Pursuant to the above regulations, the VA notified Kirkwood that beginning with the Summer, 1978, school session those veterans enrolled in its non-traditional program would no longer be eligible for full-time educational benefits because they were not in class twelve hours per week. Kirkwood and Carpenter filed a complaint on June 28, 1978, alleging that the VA regulations were promulgated without statutory authority and in violation of the first, fifth and tenth amendments of the United States Constitution. They sought mandamus, declaratory judgment, a temporary restraining order and a permanent injunction. The parties agreed to submit the matter to the court without a hearing and upon written briefs. On August 17, 1978, the district court issued its findings of fact and conclusions of law ordering the VA to: accept Kirkwood's designation of full-time students; pay full-time benefits to veterans enrolled in Kirkwood's non-traditional program who were duly certified as full-time students by Kirkwood; and suspend enforcement of Veterans Administration Regulations 14272(D), 14200(G) and Circular D.V.B. 20-77-16.

Appellant's first contention of error is that judicial review is precluded by 38 U.S.C. § 211(a) (Supp.1979) which states:

(T)he decisions of the Administrator on any question of law or fact under any law administered by the Veterans' Administration providing benefits for veterans and their dependents or survivors shall be final and conclusive and no other official or any court of the United States shall have power or jurisdiction to review any such decision by an action in the nature of mandamus or otherwise.

The above statute was designed to prevent judicial review of decisions on individual claims made by the VA. This is a valid policy since to not limit judicial review in this manner would overload the courts with the duty of second-guessing a specialized agency on technical and complex issues. However, the above statute was not designed to preclude judicial review of a challenge to the Administrator's authority to promulgate the regulations in the first instance. Wayne State University v. Cleland, 590 F.2d 627, 631 (6th Cir. 1978). Here, plaintiffs-appellees have challenged the Administrator's authority to promulgate the regulations and, therefore, 38 U.S.C. § 211(a) does not preclude review.

Appellant's second contention of error is that Kirkwood has no standing in this case. Appellant argues that veteran's educational benefits are not paid to the school but are paid directly to the student for tuition, fees and books, as well as subsistence. Therefore, argues appellant, any rights allegedly violated by the regulations belong to the veteran, not the school. We cannot agree. The institution is injured in that its definition of full-time student is overruled by the VA. Even the VA recognizes this as shown by the fact that it notified Kirkwood of its decision to cease full-time funding for students enrolled in Kirkwood's non-traditional program. Thus there is a sufficient injury to Kirkwood to fulfill the case or controversy requirement of the constitution. Wayne State University v. Cleland, 440 F.Supp. 811, 813 (E.D.Mich.1977), Rev'd on other grounds, 590 F.2d 627 (6th Cir. 1978).

Appellant's third contention of error goes to the merits of the controversy. Appellant claims that the district court erred in holding that the educational institutions, rather than the VA, have the right to determine what constitutes a full-time academic load for the purposes of receiving full-time veteran's educational benefits. We see the attack on the VA's authority as posing two distinct questions: (1) does the VA have the authority to establish twelve semester hours, as opposed to ten, fourteen, etc., as the minimum a veteran can carry and still be considered a full-time student, and (2) does the VA have the authority to define "semester hours" as twelve hours in class per week for one standard semester term?

The answer to the first question lies in the proper interpretation of 38 U.S.C. § 1788(a)(4) which, as set forth below, establishes when an undergraduate curriculum is deemed to be full-time:

(A)n institutional undergraduate course offered by a college or university on a quarter- or semester-hour basis shall be considered a full-time course when a minimum of fourteen semester hours or the equivalent thereof (including such hours for which no credit is granted but which are required to be taken to correct an educational deficiency and which the educational institution considers to be quarter or semester hours for other administrative purposes), for which credit is granted toward a standard college degree, is required, except that where such college or university certifies, upon the request of the Administrator, that (A) full-time tuition is charged to all undergraduate students carrying a minimum of less than fourteen such semester hours or the equivalent thereof, or (B) all undergraduate students carrying a minimum of less than fourteen such semester hours or the equivalent thereof, are considered to be pursuing a full-time course for other administrative purposes, then such an institutional undergraduate course offered by such college or university with such minimum number of such semester hours shall be considered a full-time course, But in the event such minimum number of semester hours is less than twelve semester hours or the equivalent thereof, then twelve semester hours or the equivalent thereof shall be considered a full-time course ; . . . (emphasis added)

If, as appellant alleges, the proviso (in italics) applies to subparts (A) and (B), Congress itself has limited the educational institution's ability to define full-time status by imposing the twelve semester hour minimum.

If this is the case, the VA cannot be held to have exceeded its authority by merely reiterating in its regulations the twelve hour minimum which Congress has already imposed. If, however, the proviso applies only to subpart (B), as appellee and amicus curiae argue, the educational institutions remain free, as set forth in subpart (A), to define full-time course however they wish.

The lower court in this case based its decision entirely on Wayne State University v. Cleland, supra, 440 F.Supp. 811, which, at the time the court reached its decision, was the only case on...