Biller v. Veneman

F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
October 7, 2005
FOR THE TENTH CIRCUIT
Clerk of Court

DOYLE E. BILLER, as Trustee of the
Doyle E. Biller Family Trust,

Plaintiff-Appellant,
No. 04-3193
v. (D.C. No. 03-CV-1128-WEB)
(D. Kan.)
ANN M. VENEMAN, Secretary of the
United States Department of
Agriculture,

Defendant-Appellee.

ORDER AND JUDGMENT *

Before HENRY , ANDERSON , and TYMKOVICH , Circuit Judges.

After examining the briefs and appellate record, this panel has determined

unanimously that oral argument would not materially assist the determination of

this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is

therefore ordered submitted without oral argument.

*
This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
 Plaintiff-Appellant Doyle E. Biller, Trustee of the Doyle E. Biller Family

Trust (Trust), appeals from the district court’s order upholding a decision of the

Department of Agriculture (Agency) to terminate the Trust from the Conservation

Reserve Program (CRP). The Trust contends that the Agency’s finding that it

violated its CRP contract by having uncontrolled noxious weeds on the subject

property was arbitrary and capricious and not supported by the evidence. The

Trust further argues that the district court erred in declining to review the

Agency’s decision to terminate the contract. This court has jurisdiction pursuant

to 28 U.S.C. § 1291, and we affirm.

Background

The CRP authorizes the Agency to enter into contracts with eligible land

owners whereby the land owner agrees to remove agricultural land from farm

production in exchange for government payments. The contracts require the

participants to implement an approved conservation plan and adhere to certain

other criteria set forth in various federal statutes and regulations. See generally

16 U.S.C. §§ 3831-3836; 7 C.F.R. Pt. 1410. At issue in this case is the

requirement that all participants subject to a CRP contract “[c]omply with noxious

weed laws of the applicable State or local jurisdiction.” 7 C.F.R. § 1410.20(a)(7).

If a participant violates the terms of a CRP contract, the Agency is authorized to

terminate the contract and assess penalties. 7 C.F.R. § 1410.52.

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 In 1997, the Trust enrolled 122.6 acres of land located in Kansas in the

CRP. Pursuant to the CRP contract, the Trust agreed to comply with the noxious

weed laws of the State of Kansas. Under Kansas law, a land owner has a duty to

control the spread of and eradicate all weeds on its property declared by

legislative action to be noxious. K.S.A. § 2-1314; Krug v. Koriel , 935 P.2d 1063,

1066 (Kan. Ct. App. 1997). Johnson grass is such a legislatively declared noxious

weed. K.S.A. § 2-1314.

In 1998, a routine status review conducted by the Natural Resources

Conservation Service (NCRS) revealed a serious Johnson grass problem on the

Trust’s property. 1
The problem was again noted in July 1999 in a report prepared

by the County Noxious Weed Department. In that report, the County Noxious

Weed Supervisor stated that a severe infestation of Johnson grass had partially

gone to seed and that in his opinion, “prior control measures had not been taken

1
The Trust argues that the Agency nonetheless marked “yes” on the 1998
Status Review to indicate that it was in compliance with its CRP contract despite
the existence of Johnson grass. Attachment D to the Trust’s brief is a copy of
what the Trust claims to be the 1998 Status Review. The word “yes” is circled to
indicate that the Trust was in compliance. Oddly, on what appears to be another
copy of the same document in the Trust’s appendix, the word “yes” is not circled.
Aplt. App. Vol. III at 372. Since neither the Trust nor the Agency addressed this
discrepancy, this court has no way of knowing whether in 1998, the Trust was
deemed to be in compliance with its CRP contract or not. It is clear from both
documents, however, that there was a problem with Johnson grass on the property.
Aplt. Br., Attach. D and Aplt. App. Vol. III at 372 (“There is a serious
johnsongrass problem.”).

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[that] calendar year.” Aplt. App. Vol. III at 263. The report concluded that the

Trust’s land was not in compliance with Kansas’s noxious weed laws.

When the Agency received the report, it sent a letter to the Trust, dated

July 28, 1999, stating that based on the severe Johnson grass infestation, the

Agency had determined that the Trust was not in compliance with its CRP

contract. The letter apprised the Trust that unless it appealed this finding, the

decision would be final and the CRP contract would be subject to termination. 2

The Trust responded by letter dated August 19, 1999, in which it outlined the

steps it had recently taken to eradicate the Johnson grass problem including firing

the property manager and hiring someone else to mow the Johnson grass.

Nonetheless, the problem persisted. A CRP Farm Spot Check report dated August

26, 1999, indicated that although most patches of the Johnson grass had been

clipped, the property still had a moderate to severe noxious weed problem. The

Trust points out, however, that an October 1, 1999, Status Review report stated

that the Johnson grass had been treated and that “[m]aintenance [was] adequate.”

Aplt. App. Vol. III at 373 .

Ultimately, the Agency concluded that 36.6 acres of the property were

infested with Johnson grass in violation of CRP regulations and the contract’s

2
The Trust claims not to have timely received this letter because it was sent
to the wrong address. Nevertheless, in a visit to the county office on August 10,
1999, Mr. Biller was advised in person of the noxious weed violation.

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noxious weed provision. Based on this finding, the Agency terminated those 36.6

acres from the program and issued a new contract to the Trust for the remaining

86 acres. The Trust objected to the partial termination and refused to sign the

new contract within the time period prescribed by the Agency. Consequently, the

Agency terminated all of the Trust property from the CRP. In two separate

appeals, the Trust challenged first the Agency’s finding that the Johnson grass

infestation constituted a violation of the CRP contract, and second the Agency’s

decision to terminate the remaining 86 acres because of the Trust’s refusal to sign

a new contract. Although both hearing officers who heard the appeals sided with

the Trust, the National Appeals Division (NAD), the body of last resort in the

administrative appeal process, reversed. In the first appeal, the NAD concluded

that the Agency’s finding of a violation was not erroneous:

The record shows that the Johnson grass infestation continued to go
unchecked from 1997 through 1999. The Appellant did not prove
that the CRP acreage was not infested with Johnson grass or provide
any evidence to show that recommended measures were taken to
maintain the coverage and control Johnson grass before notice of the
violation. The Appellant failed to carry out the CRP contract
requirement to control weeds.

Aplt. App. Vol. III at 446. In the second appeal, the NAD concluded that

pursuant to federal regulations and its internal rules, the Agency had the right to

terminate the remaining 86 acres from the CRP based on the Trust’s refusal to

sign a new contract.

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 In a single complaint, the Trust appealed both decisions to the U.S. district

court pursuant to 7 U.S.C. § 6999, which provides for judicial review of final

decisions of the NAD. The district court upheld the NAD’s finding that the Trust

property was out of compliance with the CRP, finding that the decision was

supported by substantial evidence and was not arbitrary or capricious. The

district court held, however, that it lacked jurisdiction to review the Agency’s

decision to terminate the CRP contract because there was no meaningful standard

against which to judge the Agency’s exercise of discretion.

Discussion

We review the district court’s decision upholding agency action and its

determination on jurisdiction de novo. Payton v. U.S.D.A. , 337 F.3d 1163, 1167,

1168-69 (10th Cir. 2003) . In Payton , we were charged with deciding whether an

Agency decision to terminate a CRP contract was subject to judicial review and if

so, whether the decision was arbitrary or capricious. 337 F.3d at 1165-66. The

Agency had determined that the plaintiff failed to make a good faith effort to

comply with his CRP contract and therefore terminated 35 acres of the plaintiff’s

land from the program. Id. at 1166. The district court concluded that it lacked

jurisdiction to review the decision, finding that the prerogative to terminate CRP

contracts was committed to agency discretion by law. See id. at 1167, 1168.

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 We reversed. Citing 7 C.F.R. § 1410.52(a)(1), we noted that “the

discretion of the agency to terminate a CRP contract is predicated on a finding

that the participant has failed to carry out the terms and conditions of a CRP

contract.” Id. at 1168 (quotation marks and alteration omitted). We emphasized

that whether a participant in the CRP is in compliance with the contract is a

matter that “must be decided on the basis of the facts and the law, and is not left

to the unfettered discretion of the agency.” Id. Thus, we concluded that judicial

review of the agency’s finding of a violation was appropriate because the finding

was necessarily governed by straightforward legal standards. Id. Importantly,

however, for purposes of the instant case, we did not decide in Payton “whether

the agency’s exercise of discretion with respect to whether to terminate a CRP

contract, once it has been found that the participant is in violation, is reviewable.”

Id. n.3.

Here, the Trust asks us to decide both questions: (1) whether the Agency’s

finding that the Trust violated its CRP contract was arbitrary or capricious, and

(2) whether, after finding a violation, the Agency properly terminated the entire

contract. As we held in Payton , the Agency’s determination that a plan

participant is in violation of the terms of its CRP contract must be decided based

on the facts and the law and is not left to the Agency’s unfettered discretion.

Id. at 1168. Accordingly, we have jurisdiction to review the Agency’s decision

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that the Trust violated its CRP contract by allowing Johnson grass to grow on the

property.

“The duty of a court reviewing agency action under the ‘arbitrary or

capricious’ standard is to determine whether the agency examined the relevant

evidence and articulated a rational connection between the facts found and the

decision made.” Id. at 1168. Under this standard, we conclude that the Agency’s

finding was supported by the evidence and was not arbitrary or capricious.

Although it is questionable whether, notwithstanding the Johnson grass

problem, some Agency personnel deemed the Trust to be in compliance with the

CRP, it is clear that Johnson grass was growing on the property during the

relevant time period and that Johnson grass is a noxious weed in the State of

Kansas. It is also clear that the Trust took no steps to treat the Johnson grass

until after it was notified of the violation in August 1999, even though the weed

was found on the property well before then. Although the Trust complains that it

should not be punished for failing to act before it was notified of the violation, it

has not pointed to a single statute, regulation, or contractual provision affording it

the luxury to not act absent formal notification that a violation has occurred. To

the contrary, 7 C.F.R. § 1410.20(a)(7) required the Trust to comply with state and

local noxious weed laws, which in turn placed the burden on the Trust to

affirmatively control and eradicate noxious weeds. See Krug , 935 P.2d at 756;

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K.S.A. § 2-1314. Based on this record, we conclude that the Agency examined

the relevant evidence and articulated a rational basis between the facts found and

its decision that the Trust violated the CRP contract.

We now turn to the question left open in Payton —whether, having

legitimately found a violation of the CRP contract, the Agency’s decision to

terminate the contract is reviewable. We agree with the district court that it is

not. Generally, all agency action is presumed to be reviewable under the

Administrative Procedure Act (APA). Sierra Club v. Yeutter , 911 F.2d 1405,

1410 (10th Cir. 1990). The APA, however, contains two exceptions to the

presumption of reviewability: where a statute expressly precludes judicial review,

5 U.S.C. § 701(a)(1); and where agency action is committed to agency discretion

by law, 5 U.S.C. § 701(a)(2). Here, none of the parties contend, and the district

court did not find, that review is precluded by statute. Thus, we focus on

subsection (a)(2), which precludes judicial review of actions committed to agency

discretion.

As we have previously held, this narrow exception applies only “in those

rare instances where statutes are drawn in such broad terms that in a given case

there is no law to apply.” Sierra Club , 911 F.2d at 1411 (quotation marks

omitted). “[U]nder § 701(a)(2), even when Congress has not affirmatively

precluded judicial oversight, review is not to be had if the statute is drawn so that

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a court would have no meaningful standard against which to judge the agency’s

exercise of discretion.” Webster v. Doe , 486 U.S. 592, 599-600 (1988) (quotation

marks omitted). This standard requires careful examination of the statute

pursuant to which the agency acted. See id. at 600.

The Trust challenges the Agency’s decision first to terminate the 36.6 acres

with the Johnson grass infestation and then the remaining 86 acres when the Trust

refused to sign a new contract. The statutory and regulatory scheme at issue,

however, gives the Agency broad discretion to terminate a CRP contract or

institute some other remedy once a violation is found. The applicable statute,

16 U.S.C. § 3832(a)(5), provides that a CRP participant forfeits all rights under

the contract “if the Secretary, after considering the recommendations of the soil

conservation district and the Natural Resources Conservation Service, determines

that the violation is of such nature as to warrant termination of the contract.” The

regulations in turn provide that the Agency may terminate a CRP contract if “[t]he

participant is not in compliance with the terms and conditions of the contract.” 7

C.F.R. § 1410.32(f)(3); see also 7 C.F.R. § 1410.52(a)(1). If the Agency decides

that termination is not warranted, it can implement other relief as it deems

appropriate, see id. at § 1410.52(b), including demanding a refund or adjusting

payments under the contract. See 16 U.S.C. § 3832(a)(5)(B). Finally, in order for

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land to be enrolled in the CRP, the regulations require that a contract be signed

within the time period prescribed by the Agency. 7 C.F.R. § 1410.32(d).

In Webster , the Supreme Court held that a provision of the National

Security Act allowing the termination of an employee whenever the Director

“deem[ed] such termination necessary or advisable in the interests of the United

States,” 486 U.S. at 600 (quotation marks and alteration omitted), exuded

deference to the Director and foreclosed the courts’ ability to apply any

meaningful standard of review. Id. The Court concluded that the language of the

provision “strongly suggest[ed] that its implementation was committed to agency

discretion by law.” Id. (quotation marks omitted).

Following the above standards and guided by the Court’s decision in

Webster , we conclude that the statute and regulations at issue in this case

foreclose our ability to apply any meaningful standard of review to the Agency’s

decision to fully or partially terminate a CRP contract once a violation has been

found. Like the statute in Webster , we believe that the statutory and regulatory

scheme at issue exudes full deference to the Agency once a legitimate violation

has been found. See North Dakota v. Yeutter , 914 F.2d 1031, 1035 (8th Cir.

1990) (noting that the statutory scheme “governing the CRP accord[s] the

Secretary broad discretion in his administration of various aspects of the

program.”). We therefore hold that the decision of the Agency to first partially

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and then fully terminate the Trust’s CRP contract was a decision committed to

agency discretion by law and is not judicially reviewable.

Accordingly, the judgment of the district court is AFFIRMED .

Entered for the Court

Stephen H. Anderson
Circuit Judge

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