Paramount Farms, Inc. v. Morton, 75--1159

• Decision Date: 11 December 1975
• Docket Number: No. 75--1159,75--1159
• Citation: 527 F.2d 1301
• Parties: PARAMOUNT FARMS, INC., Plaintiff-Appellant, v. Rogers C. B. MORTON et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 1301

527 F.2d 1301

PARAMOUNT FARMS, INC., Plaintiff-Appellant, v. Rogers C. B. MORTON et al., Defendants-Appellees.

No. 75--1159.

United States Court of Appeals Seventh Circuit.

Argued Sept. 22, 1975.

Decided Dec. 11, 1975.

Hiram D. Anderson, Jr., Stevens Point, Wis., for plaintiff-appellant.

Wallace H. Johnson, Asst. Atty. Gen., and Kathryn A. Oberly, Atty., Dept. of Justice, Washington, D.C., David C. Mebane, U.S. Atty., Madison, Wis., for defendants-appellees.

Before STEVENS and TONE, Circuit Judges, and KUNZIG ^*, Judge.

KUNZIG, Judge.

The question presented by this appeal is whether a Federal court has jurisdiction to review the alleged failure of the defendants to comply with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, 84 Stat. 1894, 42 U.S.C. § 4601 et seq. (1971) (Policy Act). Plaintiff sought to enjoin certain condemnation proceedings until the government complied with various guidelines contained in the Policy Act. The lower court dismissed this claim for relief for lack of subject matter jurisdiction. Paramount Farms, Inc. v. Morton, 384 F.Supp. 1294 (W.D.Wis.1974). We find that the district court was precluded by statute from reaching the merits of plaintiff's complaint and, therefore, affirm the dismissal.

Plaintiff is a family-owned corporation holding title to Outer Island, an island in Lake Superior. The land is located within the confines of the recently created Apostle Island National Park. Therefore, it was slated for acquisition by the government. Beginning in April 1972, the Park Service attempted to acquire Outer Island by negotiation and purchase. Plaintiff refused an offer of $195,000, claiming the Island was worth at least $900,000. When negotiations proved unsuccessful, the Park Service instituted the condemnation proceeding presently pending in the Western District of Wisconsin. United States v. 10,100.01 Acres, Civ. No. 73--C--235 (W.D.Wisc., filed Sept. 10, 1973).

Plaintiff subsequently brought this suit to enjoin the condemnation proceeding, alleging that the Park Service had not complied with the administrative guidelines outlined in section 4651 of the Policy Act, entitled 'Uniform policy on real property acquisition practices.' Specifically, plaintiff claimed that the Park Service had (1) not made every effort to acquire Outer Island by negotiation; (2) failed to appraise plaintiff's property; (3) failed to notify plaintiff of the value established by the Park Service as just compensation, and (4) used the threat of condemnation in an attempt to coerce the plaintiff into an agreement. ¹

Plaintiff's complaint alleged that the Administrative Procedure Act (APA) conferred jurisdiction to review the defendants' actions. Section 702 of the APA grants a right of judicial review to any individual 'suffering legal wrong' or 'adversely affected or aggrieved by agency action' within the meaning of a relevant statute. 5 U.S.C. § 702 (1971). A judicial determination is expressly foreclosed, however, where 'statutes preclude judicial review. . . .' 5 U.S.C. § 701(a)(1) (1971).

Defendants challenge plaintiff's jurisdictional allegation on the ground that section 4602(a) of the Policy Act forecloses judicial consideration of the section 4651 guidelines which plaintiff seeks to enforce. Section 4602(a), 84 Stat. 1895, reads:

The provisions of section (4651) . . . of (subchapter III) . . . of this Act create no rights or liabilities and shall not affect the validity of any property acquisition by purchase or condemnation. (emphasis added).

In an opinion of July 3, 1973, denying plaintiff's motion for a preliminary injunction in this case and in a later order of November 13, 1974, granting defendants' motion to dismiss, District Court Judge James E. Doyle relied on the 'no rights or liabilities' language of section 4602(a) in denying the preliminary injunction and in granting the motion to dismiss. Plaintiff now appeals Judge Doyle's order granting defendants' motion to dismiss. We affirm the decision below as a well-considered resolution of the problem.

The sole question presented on appeal is whether this determination complies with the review standards outlined by sections 701 and 702 of the APA.

It is well settled that the APA implies a presumption of reviewability. The House Report to the APA noted:

To preclude judicial review under this bill a statute, if not specific in withholding such review, must upon its face give clear and convincing evidence of an intent to withhold it. H.R.Rep. No. 1980, 79th Cong., 2d Sess. 41 (1946).

Section 702 of the APA has been liberally construed as 'serving a broadly remedial purpose.' Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 156, 90 S.Ct. 827, 25 L.Ed.2d 184 (1970). '(J)udicial review of such administrative action is the rule, and nonreviewability an exception which must be demonstrated.' Barlow v. Collins,397 U.S. 159, 166, 90 S.Ct. 832, 838, 25 L.Ed.2d 192 (1970). However, judicial review will be foreclosed where 'there is persuasive reason to believe that such was the purpose of Congress.' Abbott Laboratories v. Gardner, 387 U.S. 136, 140, 87 S.Ct. 1507, 1511, 18 L.Ed.2d 681 (1967). Further, the APA does not confer jurisdiction to review agency determinations where the regulatory statute itself precludes judicial review. Balanyi v. Electrical Workers Local 1031, 374 F.2d 723, 726 (7th Cir. 1967). Therefore, we must review the legislative history as well as the meaning of the 'no rights or liabilities' language of section 4602 of the Policy Act to determine if judicial review of agency action or inaction has been precluded by Congress.

Prior to passage, the Policy Act experienced a complicated series of amendments and deletions. The full legislative history was extensively reviewed in Barnhart v. Brinegar, 362 F.Supp. 464, 466--473 (W.D.Mo.1973). We concur with Barnhart's finding of clear and convincing evidence of Congressional intent to foreclose review under section 4651. This intent is evidenced most strongly by the House Report's description of section 4602(a) of the Policy Act:

(The House version of the proposed Policy Act) provides that any determination by the head of the Federal agency administering a program or project, as to payments under the act, shall be final, and that this act does not give any person a cause of action or a defense to an action in any court, or create any new elements of value or damage in any eminent domain proceedings. . . .

The committee has considered, but does not agree with proposals which would make the benefits provided by the bill subject to judicial review. The committee agrees with the judgment of the Department of Justice, and others, who believe that this would add an unnecessary burden to the overcrowded courts. H.R.Rep. No. 91--1656, 91st Cong., 2d Sess., (1970); U.S.Code Cong. & Admin.News, p. 5854 (1970).

Plaintiff contends that the report is irrelevant because it allegedly addressed a form of the bill which was later amended. However, the plain language of the final version of section 4651 adequately demonstrates that this philosophy was never abandoned. The introductory paragraph states that Federal agencies are merely guided 'to the greatest extent practicable. . . .'

The text of the Policy Act and its legislative history make it abundantly clear that Congress expressly desired to deprive Federal courts of jurisdiction to entertain actions of this nature. The plaintiff's claim, therefore, falls within Section 701 of the APA, which provides an exception to reviewability where 'statutes preclude judicial review.' Indeed, it is difficult to attach any other meaning to the plain and unambiguous words 'no rights or liabilities.' We agree with Judge Doyle's conclusion that a party lacking rights or liabilities under section 4651 cannot be adversely affected or aggrieved by agency action under that statute.

Recent decisions analyzing section 4651 support this conclusion. In Rhodes v. City of Chicago, 516 F.2d 1373 (7th Cir. 1975), we relied on the plain meaning and the legislative history of section 4602(a) and refused to review violations similar to those asserted by the plaintiff in this case. See also, Will-Tex Plastics Mfg., Inc. v. Department of Housing and Urban Development, 346 F.Supp. 654 (E.D.Pa.1972), aff'd without opinion, 478 F.2d 1399 (3rd Cir. 1973); Barnhart v. Brinegar, supra; Martinez v. Department of Housing and Urban Development, 347 F.Supp. 903 (E.D.Pa.1972); Rubin v. Department of Housing and Urban Development, 347 F.Supp. 555, 558 (E.D.Pa.1972).

Plaintiff argues that in Bethune v. United States, 376 F.Supp. 1074 (W.D.Mo.1972), the court found jurisdiction to reach the merits of alleged section 4651 violations. Although the Bethune court did enjoin condemnation proceedings pending a county's compliance with the negotiation and appraisal provision of section 4651, that case is clearly distinguishable from the instant situation. The condemnee's right of review in Bethune stemmed from a contract between the county and H.U.D. which incorporated the guidelines of section 4651. The court concluded that the 'no rights or liabilities' language of section 4602(a) 'does not preclude this action for the reason that said action is not based upon rights arising under Title 42, U.S.C.A., Section 4601 et seq., but is based upon duties imposed by . . . the contractual relations between (H.U.D.) and Jackson County, Missouri.' Bethune, supra, 376 F.Supp. at 1078. The record presented on this appeal contains no evidence of a similar contract. Plaintiff's reliance on Bethune is misplaced.

Moreover, we recently held that condemnation actions may not be affected by alleged noncompliance with section 4651. United States v. 416.81 Acres, Nos. 74--1307 and 74--1308 (7th Cir., decided April 28, 1975). There, various landowners in a condemnation proceeding sought to exclude the testimony of three...