United States v. Wiley's Cove Ranch

• Decision Date: 26 December 1961
• Docket Number: No. 16556.,16556.
• Citation: 295 F.2d 436
• Parties: UNITED STATES of America, Appellant, v. WILEY'S COVE RANCH, Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

295 F.2d 436 (1961)

UNITED STATES of America, Appellant, v.WILEY'S COVE RANCH, Appellee.

No. 16556.

United States Court of Appeals Eighth Circuit.

October 23, 1961.

Rehearing Denied December 26, 1961.

Kathryn H. Baldwin, Atty., Dept. of Justice, Washington, D. C., George Cochran Doub, Asst. Atty. Gen., Charles W. Atkinson, U. S. Atty., Fort Smith, Ark., Alan S. Rosenthal, Atty., Dept. of Justice, Washington, D. C., for appellant.

William S. Walker, Harrison, Ark., N. J. Henley, Marshall, Ark., for appellee.

Before VOGEL and BLACKMUN, Circuit Judges, and DAVIES, District Judge.

VOGEL, Circuit Judge.

This is an appeal from the granting of summary judgment¹ against the United States, appellant, in its action to recover payments made by the Department of Agriculture for benefits received by appellee in the way of livestock feed under the 1954 Emergency Feed Program.

Pursuant to statutory authority, 12 U.S.C.A. § 1148a-2(d), the Secretary of Agriculture, by regulation, delegated the program's administration to the Farmers' Home Administration, including the power to establish rules and regulations for determining an applicant's eligibility to receive aid under the program.Such regulations as are pertinent to this case will be hereinafter set forth.

Appellee is a partnership engaged in farming and ranching in Arkansas.It applied for federal assistance under the provisions of the 1954 Emergency Feed Program.As a result of two applications, dated September 9 and December 13, 1954, it received, through purchase orders, 341,000 pounds of surplus grains at an alleged cost to the government of $3,410, the amount here sought to be recovered.These applications were passed upon, approved and, upon request, reexamined and again approved by a "County Committee" composed of three local persons appointed pursuant to the FHA regulations.On March 13, 1955, after the appellee had already received the benefits under the program, the FHA's State Director by letter informed the appellee that its application had been "rejected" by the "National Office" due to appellee's alleged ability to maintain its foundation herd without aid and, accordingly, demand for reimbursement was made.Appellee refused to refund the value of the benefits received.On June 5, 1959, over four years later, this suit to enforce repayment was commenced.

No fraud or claim of fraud is involved.The government concedes that its case is grounded solely on the alleged claim that:

"The financial condition and net worth of the partnership was not such that it required assistance under this program to maintain its foundation herd of livestock and to continue its livestock operations."

The appellee's applications for assistance under the program recited the number of livestock in its "basic herd", the amount of feed it had on hand and the acreage and expected yield of feed crops growing.They also contained the following certificate by appellee:

"I certify that the above information is correct, that my principal occupation is farming or ranching, and that I do not have a 60-day supply of feed on hand to maintain my basic herd of livestock listed in item 1.

"In order to provide a 60-day supply of feed for this livestock, I will need 0 tons of hay and 144,000² pounds of SURPLUS GRAINS DESIGNATED BY THE COMMODITY CREDIT CORPORATION in addition to the feed I have on hand and that to be harvested during that period, and hereby make application for the purchase of that amount of feed under the Emergency Feed Program.Without the assistance applied for under the Emergency Feed Program I will be unable to maintain my basic foundation herd and to continue the livestock operation which I have been conducting for 17 years.I WILL NOT SELL OR OTHERWISE DISPOSE OF ANY OF THE FEED HEREIN APPLIED FOR EXCEPT BY FEEDING IT TO MY BASIC HERD, IN Searcy COUNTY."

Concerning appellee's eligibility, two members of the County Committee³ stated, inter alia, in an affidavit accompanying appellee's motion to dismiss:

"That during the year of 1954 the said William J. Seeger was manager of the said Wiley\'s Cove Ranch and authorized to act for and in behalf of the Mays family in the operation of the said Wiley\'s Cove Ranch; that the said William J. Seeger is now deceased.Affiants further state that the said William J. Seeger made proper application for feed under said Emergency Feed Program and that said County Committee made proper and due investigation of said application and determined that the said Wiley\'s Cove Ranch was fully eligible to receive feed under said program.

"Affiants personally knew that the said Wiley\'s Cove Ranch, like all other farmers in Searcy County during the year aforesaid was unable to raise any feed by reason of the extreme drouth; that said Ranch was devoted exclusively to raising purebred Hereford cattle for breeding purposes and had, at that time, several hundred head of said cattle which constituted a foundation herd for the purposes aforesaid; that it is and was the honest opinion of said Committee that the said Wiley\'s Cove Ranch received more than one-half of their net income for said year from raising and selling breeding stock from their herd of purebred cattle.

"That following the original certification of eligibility of said Wiley\'s Cove Ranch said County Committee was requested to re-examine the question of the eligibility of said Wiley\'s Cove Ranch to receive said emergency relief, and this re-examination was requested and done by reason of the fact that some question had arisen as to the eligibility of the Ranch to receive the aid aforesaid.

"That said Committee accordingly made a thorough investigation of the condition existing at the Wiley\'s Cove Ranch in reference to the eligibility aforesaid, and said Committee again found and determined that the said Wiley\'s Cove Ranch was fully and completely eligible to receive said help, and said County Committee again re-certified said fact to be true, and that the records of the Farmer\'s Home Administration will reflect the above facts to be true; that affiants are not related by blood or marriage to any member of the Mays family and that they have no personal interest, one way or another in the matter under discussion herein, and that they and each of them feel that they performed their duties as prescribed by law, * * *."181 F.Supp. at pages 372-373.

The trial court, in granting summary judgment for appellee, held that the County Committee's action in determining appellee's eligibility constituted unreviewable agency action under § 10 of the Administrative Procedure Act,5 U.S.C.A. § 1009, which provides for judicial review of agency action except so far as (1)the statutes preclude judicial review, or (2) agency action is by law committed to agency discretion.In so holding the court stated:

"Therefore, considering the fact that no fraud has been alleged; that the subject matter of the administrative hearing was a gratuity; that the County Committee was given wide discretionary authority in certifying applicants, and finally that the Committee was required to base its decision in part on strictly local conditions, including its personal knowledge of the applicant\'s qualifications and predicted future economic conditions in the county, the court is compelled to hold that the decision of the County Committee in this instance constitutes a nonreviewable administrative determination."181 F.Supp. at page 380.

The government's primary contention on appeal is that independently of statute, the United States can sue to recover payments erroneously and illegally made by its agents and it terms the trial court's discussion of § 1009(2), supra, as "inapposite" in that here the action is not one for judicial review but "to recover public moneys erroneously and illegally paid".The distinction attempted is without substance.It can make little difference what the claim for relief is called.The prohibition of the statute may not be evaded by the simple expedient of denominating the action one for moneys erroneously and illegally paid.Nevertheless, the government here contends that its

"* * * right to sue to recover payments erroneously made is conclusively established.United States v. Wurts, 303 U.S. 414, 415, 58 S.Ct. 637, 82 L.Ed. 932;Wisconsin Central Railroad Co. v. United States, 164 U.S. 190, 212, 17 S.Ct. 45, 41 L.Ed. 399;United States v. Burchard, 125 U.S. 176, 180, 8 S.Ct. 832, 31 L.Ed. 662.Cf.Land O\'Lakes Creameries v. Commodity Credit Corporation, 8 Cir.265 F.2d 163.See alsoKraft Foods Co. of Wisconsin v. Commodity Credit Corporation, 7 Cir.266 F.2d 254;Swift & Co. v. United States, 4 Cir.257 F.2d 787;Kingman Water Co. v. United States, 9 Cir.253 F.2d 588;United States v. Bentley, 2 Cir.107 F.2d 382",

and that no statute is necessary to maintain such suit.

In none of the cases relied on was it held that the payment made by the government was done pursuant to a vested discretionary power.The issue in the cited cases was whether payments made by the government by legal mistake were recoverable by the government.Such illegal payments are recoverable.Of the cited cases, Kraft Foods Co. of Wisconsin v. Commodity Credit Corporation, 7 Cir., 1959, 266 F.2d 254, certiorari denied361 U.S. 832, 80 S.Ct. 83, 4 L.Ed. 2d 74, Land O'Lakes Creameries v. Commodity Credit Corporation, 8 Cir., 1959, 265 F.2d 163, andSwift & Co. v. United States, 4 Cir., 1958, 257 F.2d 787, certiorari denied358 U.S. 837, 79 S.Ct. 60, 3 L.Ed.2d 73, rehearing denied358 U.S. 901, 79 S.Ct. 220, 3 L.Ed.2d 152, involved actions by or against Commodity Credit Corporation for the recovery or retention of paid dairy support prices.Congress had authorized the Secretary of Agriculture to support the market on dairy products either by loans or by purchases of the products.The controlling issue in each case was whether the Commodity Credit Corporation"purchased" the dairy products described.It...