Shawnee Trail Conservancy v. United States Department of Agriculture

In the
United States Court of Appeals
For the Seventh Circuit
No. 99-3364
Shawnee Trail Conservancy, Illinois Trail Riders,
Horsemen’s Council of Illinois, Southern Illinois
Campground and Ranch Owners Association,
and Illinois Federation of Outdoor Resources,
Plaintiffs-Appellants,
v.
United States Department of Agriculture,
United States Forest Service, Daniel Glickman,
Secretary of Agriculture, Michael P. Dombeck,
Chief, United States Forest Service, Robert T.
Jacobs, Regional Forester, Eastern Region
(R-IX), United States Forest Service,
and Louise Odegaard, Supervisor,
Shawnee National Forest,
Defendants-Appellees.
Appeal from the United States District Court
for the Southern District of Illinois, Benton Division.
No. 98-CV-4248-JPG--J. Phil Gilbert, Chief Judge.
Argued March 29, 2000--Decided July 25, 2000
Before Flaum, Ripple, and Kanne, Circuit Judges.
Flaum, Circuit Judge. The Shawnee Trail
Conservancy, the Illinois Trail Riders, the
Horsemen’s Council of Illinois, the Southern
Illinois Campground and Ranch Owners Association,
and the Illinois Federation of Outdoor Resources
brought suit in federal district court under both
the United States Constitution and the
Administrative Procedure Act ("APA"), 5 U.S.C.
sec. 701 et seq., alleging that the defendants
lacked the constitutional and statutory authority
to designate certain areas of the Shawnee
National Forest (the "Shawnee") as Research
Natural Areas ("RNAs"). The district court
dismissed both of the plaintiffs’ claims for lack
of subject matter jurisdiction, finding that the
plaintiffs’ constitutional claim was an adverse
claim of title against the United States and
therefore had to be brought pursuant to the Quiet
Title Act of 1972 ("QTA" or the "Act"), 28 U.S.C.
sec. 2409a et seq., and that the plaintiffs
failed to exhaust their administrative remedies
for purposes of their APA claim. For the reasons
stated herein, we affirm the decision of the
district court.
I. Facts
The dispute in this case centers on the use of
the Shawnee National Forest, an area that
consists of approximately 265,135 acres in
southern Illinois. The Shawnee is managed by the
United States Forest Service according to a land
use and management plan required by statute.
According to the applicable regulations, the goal
of the land use and management plan is to
"maximize[ ] long term net public benefits in an
environmentally sound manner."
In November 1986, the Forest Service issued its
1986 Land and Resource Management Plan. Among
other things, the Plan proposed that twelve areas
in the Shawnee, including the Atwood Ridge area
and the Burke Branch area, be designated RNAs.
RNAs are areas of land within a National Forest
on which the Forest Service allows natural
conditions to prevail in order to promote
biological diversity, research and monitoring,
and education. The Chief of the Forest Service
followed the recommendations of the 1986 Plan and
established the Atwood Ridge RNA in September
1990 and the Burke Branch RNA in March 1991.
The Forest Service has designated a total of
eighty-one areas in the Shawnee as RNAs. In order
to protect these areas, mountain bikes, all-
terrain vehicles, and off-road motorcycles are
prohibited. In addition, equestrian use is
limited to designated trails. On January 31,
1997, the Forest Service took the additional step
of closing forty of the Shawnee’s RNAs, including
the Atwood Ridge RNA and the Burke Branch RNA, to
all equestrian use.
In July 1998, the plaintiffs filed suit in
federal district court challenging the Forest
Service’s decision to restrict access to the
Atwood Ridge and Burke Branch areas and its
decision to designate those areas as RNAs. The
district court dismissed the plaintiffs’
constitutional claim on the ground that it
challenged the United States’ title to land and
consequently had to be brought under the QTA. The
district court also dismissed the plaintiffs’ APA
claim, holding that they failed to exhaust their
administrative remedies. This appeal followed.
II. Analysis
We review de novo the district court’s grant of
the defendants’ motion to dismiss for lack of
subject matter jurisdiction. See Sapperstein v.
Hager, 188 F.3d 852, 855 (7th Cir. 1999). In
considering the defendants’ motion to dismiss, we
"must accept as true all well-pleaded factual
allegations and draw reasonable inferences in
favor of the plaintiff[s]." Capital Leasing Co.
v. FDIC, 999 F.2d 188, 191 (7th Cir. 1993).
A. The Quiet Title Act
The plaintiffs’ complaint alleged that the
Forest Service lacks the authority to restrict
the use of certain roads in the Atwood Ridge RNA
and the Burke Branch RNA. According to the
plaintiffs, these roads are subject to both
public and private easements and rights-of-way
that pre-date the creation of the Shawnee. The
plaintiffs contend that because these easements
and rights-of-way have been continually used and
have not been vacated or abandoned, the right to
control the use of the roads in the Atwood Ridge
RNA and the Burke Branch RNA are not held by the
Forest Service. In other words, the plaintiffs
contend that the Forest Service cannot restrict
the use of the roads in the Atwood Ridge and
Burke Branch areas because they do not own the
property rights necessary to make decisions
concerning their incidents of use.
The district court did not reach the
plaintiffs’ constitutional claim on the merits,
but rather concluded that it did not have subject
matter jurisdiction over this claim because the
plaintiffs’ argument represented a clear
challenge to the United States’ ownership of the
land in question. According to the district
court, all such challenges must be brought
pursuant to the QTA. Because the plaintiffs did
not bring their claim under the QTA, but rather
under the Constitution, the district court held
that it could not consider the issue of title to
the land. The district court further found
unpersuasive the plaintiffs’ attempt to structure
their claim as a constitutional challenge to the
federal government’s regulatory authority, and
not to its title. On appeal, the plaintiffs
contend that this decision was erroneous and that
the district court properly had subject matter
jurisdiction over their constitutional challenge
to the restrictions imposed by the Forest
Service.
The QTA operates as a limited waiver of
sovereign immunity in cases where a party seeks
to adjudicate a title dispute to real property in
which the United States claims an interest.
Specifically, the Act provides that: "The United
States may be named as a party defendant in a
civil action under this section to adjudicate a
disputed title to real property in which the
United States claims an interest, other than a
security interest or water rights." 28 U.S.C.
sec. 2409a(a). In its decisions interpreting the
QTA, the Supreme Court has made clear that,
through its adoption of the Act, "Congress
intended . . . to provide the exclusive means by
which adverse claimants could challenge the
United States’ title to real property." Block v.
North Dakota, 461 U.S. 273, 286 (1983) (emphasis
added). While the plaintiffs concede that the QTA
is the exclusive vehicle for suits challenging
the United States’ title to real property in
certain contexts, they contend that this
exclusivity principle does not apply when the
party bringing the suit is not an adverse
claimant.
The plaintiffs contend that the "adverse
claimants" language in the Supreme Court’s Block
opinion is an important limitation on the
exclusivity of the QTA. The plaintiffs admit that
the Act is the exclusive means by which a party
claiming a property interest in land in which the
United States also maintains an interest may
challenge the United States’ assertion of title.
However, the plaintiffs argue that the QTA does
not limit their ability to challenge the United
States’ regulatory authority by bringing suit
pursuant to other statutes or the Constitution as
long as they do not seek to quiet title in
themselves. Under this theory, because the
plaintiffs do not claim that they own the
easements or rights-of-way over the roads in the
Atwood Ridge RNA and the Burke Branch RNA, the
plaintiffs’ suit need not be brought pursuant to
the QTA.
In support of this argument, the plaintiffs do
not cite any case law specifically limiting the
exclusivity of the QTA to suits in which the
plaintiffs seek to quiet title in themselves.
Instead, they rely on cases that have entertained
challenges to the regulatory authority of the
United States without addressing the QTA. See,
e.g., Wilkensen v. Department of the Int., 634
F. Supp. 1265 (D. Colo. 1986); Stupak-Thrall v.
Glickman, 988 F. Supp. 1055 (W.D. Mich. 1997).
Although we recognize that these cases resolved
title disputes similar to the one around which
this case centers without reference to the QTA,
it is significant that those cases give no
indication that the QTA was ever raised as an
issue. In circumstances where a court assumes
jurisdiction without addressing a jurisdictional
issue, that assumption of jurisdiction is of
limited precedential value. See United States v.
L.A. Tucker Truck Lines, Inc., 344 U.S. 33, 38
(1952) ("[T]his Court is not bound by a prior
exercise of jurisdiction in a case where it was
not questioned and it was passed sub silento.").
Because we find the precedent cited by the
plaintiffs to be of little value, the merits of
their argument turn on the persuasiveness of
their definition of "adverse claimants."
According to the plaintiffs, the plain meaning of
"adverse claimants" does not include parties who,
although challenging the federal government’s
right to regulate land, do not attempt to quiet
title in themselves. Although we agree that the
interpretation offered by the plaintiffs is a
plausible one, we do not believe that the
language of the Supreme Court’s opinion in Block
is as clear as the plaintiffs contend. It is true
that the plaintiffs do not assert that they own
the land, and in that sense they are not making
a claim to title on behalf of themselves that is
adverse to the government’s asserted interest.
However, the plaintiffs do claim that certain
third parties own the land, and not the
government, and this in itself represents an
assertion of title that runs adverse to the
government. In these circumstances, the plain
meaning of the phrase "adverse claimants" does
not adequately answer the question before us.
In considering this very issue, the Ninth
Circuit rejected the argument made by the
plaintiffs and held that the QTA applies any time
a party seeks a title determination regarding
real property in which the United States asserts
an interest. See Metropolitan Water Dist. v.
United States, 830 F.2d 139, 143-44 (9th Cir.
1987) (per curiam), aff’d sub nom. California v.
United States, 490 U.S. 920 (1989). In that case,
the Metropolitan Water District sought to prevent
an Indian tribe from gaining additional water
rights as the result of an expansion in the
tribe’s reservation boundaries. See id. at 141.
Although recognizing that the water district was
"not seeking to quiet title in itself," the court
held that the QTA applied because the water
district "s[ought] a determination of the
boundaries of the Reservation" and "[t]he effect
of a successful challenge would be to quiet title
in others than the Tribe." Id. at 143. In a later
opinion, the Ninth Circuit noted that
"Metropolitan Water District expanded the
application of the QTA to govern suits involving
plaintiffs who, while not seeking to quiet title
in themselves, might potentially affect the
property rights of others through successfully
litigating their claims." Alaska v. Babbitt, 38
F.3d 1068, 1074 (9th Cir. 1994).
Although no other court has considered the
issue presented to us in as direct a fashion as
the Ninth Circuit, several courts have indicated
that the Ninth Circuit’s broad reading of the
exclusivity of the QTA is correct. In a suit for
money damages based on an allegedly invalid
government sale of land, the Supreme Court
rejected the plaintiff’s attempts to avoid the
QTA on the ground that resolution of the case
entailed determining who held valid title to the
land in question. See United States v. Mottaz,
476 U.S. 834, 841-43 (1986) (noting that "the
claim for title is the essence and bottom line of
respondent’s case"). Similarly, in cases where
the QTA is raised as a jurisdictional issue,
other federal courts consistently apply the QTA
in circumstances where parties do not seek to
quiet title in themselves. See Rosette, Inc. v.
United States, 141 F.3d 1394, 1397 (10th Cir.
1998) (dismissing a declaratory judgment action
brought outside the QTA because the plaintiff’s
claims were "all linked to the question of
title"); Nevada v. United States, 731 F.2d 633,
636 (9th Cir. 1984) (applying the QTA to a
Property Clause claim where, in order to succeed,
the plaintiff "would have to show that the United
States lacked title" to the property in dispute);
Hat Ranch, Inc. v. Babbitt, 932 F. Supp. 1, 3
(D.D.C. 1995), aff’d sub nom. Hat Ranch, Inc. v.
United States, 102 F.3d 1272 (D.C. Cir. 1996)
(refusing to consider declaratory judgment action
where "[t]he authority to levy grazing fees
depends upon ownership of the land" and where
"[i]n order to decide who is entitled to assess
and collect grazing fees, th[e] Court would be
required to decide who owns the [disputed
lands]"); Town of Beverly Shores v. Lujan, 736
F. Supp. 934, 944 (N.D. Ind. 1989) (dismissing an
APA claim for lack of subject matter jurisdiction
because "an action pursuant to the APA . . . is
not the proper method for determining competing
claims to real property to which the United
States of America claims interest"). It thus
appears that the majority of courts that have
considered the QTA in the context of claims that
do not seek to quiet title in the party bringing
the action have nonetheless found the Act
applicable, and we find the reasoning of these
cases persuasive.
In adopting the QTA, Congress waived the United
States’ sovereign immunity to suits challenging
the United States’ title to land. See Lombard v.
United States, 194 F.3d 305, 308 (1st Cir. 1999).
However, this waiver of sovereign immunity is
limited, most importantly by the Acts’ twelve
year statute of limitations on title claims, 28
U.S.C. sec. 2409a(g), and by the preservation of
immunity in cases where the United States claims
an interest in land as trust or restricted Indian
land, 28 U.S.C. sec. 2409a(a). To allow claimants
to avoid the QTA by characterizing their
complaint as a challenge to the federal
government’s regulatory authority would be to
allow parties to seek a legal determination of
disputed title without being subject to the
limitations placed on such challenges. See
Rosette, 141 F.3d at 1397 (stating that allowing
a declaratory judgment action "would render the
Quiet Title Act’s statute of limitations
meaningless"); Nevada, 731 F.2d at 636 (arguing
that to allow a Property Clause challenge outside
the QTA "would be to render [that Act’s] statute
of limitations meaningless"). "’It would require
the suspension of disbelief to ascribe to
Congress the design to allow its careful and
thorough remedial scheme to be circumvented by
artful pleading.’" Block, 461 U.S. at 285
(quoting Brown v. GSA, 425 U.S. 820, 833 (1976)).
Because we believe that Congress intended for
suits that require resolution of a disputed claim
to real property in which the United States
claims an interest to be brought under the QTA,
we hold that the district court properly
dismissed the plaintiffs’ constitutional
challenge for lack of subject matter
jurisdiction.
B. The Administrative Procedure Act
The plaintiffs next contend that the Forest
Service violated the APA in acting arbitrarily,
capriciously, and not in accordance with the law
when it designated the Atwood Ridge and Burke
Branch areas of the Shawnee as RNAs. The district
court dismissed this APA claim for lack of
subject matter jurisdiction, finding that the
plaintiffs failed to exhaust their administrative
remedies before filing suit in federal district
court. The plaintiffs appeal this holding,
arguing that the district court erred when it
refused to excuse the plaintiffs’ failure to
exhaust their administrative remedies because,
according to the plaintiffs, pursuing those
administrative remedies would have been futile.
The requirement of administrative exhaustion is
a traditional common law doctrine that has now
been codified in section 10(c) of the APA, 5
U.S.C. sec. 704. Although section 10(c) only
permits review of agency actions that are
"final," any definitive agency decision is
considered "final," and therefore reviewable,
unless the agency’s regulations require
exhaustion as a prerequisite to judicial review.
See Darby v. Cisneros, 509 U.S. 137, 153 (1993).
In this case, the relevant Forest Service
regulation provides that "any filing for Federal
judicial review of a decision subject to review
under this part is premature and inappropriate
unless the plaintiff has first sought to invoke
and exhaust the procedures available under this
part." 36 C.F.R. sec. 217.18. Because the Forest
Service regulations explicitly require exhaustion
as a prerequisite to judicial review, and because
the plaintiffs in this case did not pursue the
available administrative appeals to the
challenged RNA designations, the district court
was correct in applying an administrative
exhaustion requirement to the plaintiffs’ APA
claim. See Glisson v. United States Forest
Service, 55 F.3d 1325, 1328 (7th Cir. 1995)
(applying the administrative exhaustion
requirement of the APA in circumstances where
Forest Service regulations require such
exhaustion).
The plaintiffs do not challenge the conclusion
that an administrative exhaustion requirement
could apply to their case, but rather contend
that this requirement should have been waived
because any administrative appeal would have been
futile. See, e.g., McCarthy v. Madigan, 503 U.S.
140, 146-49 (1992) (discussing waiver of the
exhaustion requirement in circumstances where an
appeal is futile); Wilczynski v. Lumbermens
Mutual Casualty Co., 93 F.3d 397, 402 (7th Cir.
1996) (recognizing the futility exception to
administrative exhaustion). According to the
plaintiffs, the United States Department of
Agriculture and the Forest Service were bound by
the terms of a 1988 settlement agreement with
various environmental groups that precluded them
from re-opening roads in the Burke Branch and
Atwood Ridge areas. The plaintiffs argue that
because the defendants are prohibited by a pre-
existing settlement agreement from changing the
RNA designations that the plaintiffs now
challenge, any appeal to the Forest Service
seeking to alter those designations would have
been futile.
Although we do not believe that the district
court had the power to waive the statutorily-
mandated exhaustion requirement of the APA, see
Glisson, 55 F.3d at 1327 (contrasting the
flexible common law doctrine of administrative
exhaustion with the "inflexible command of a
statute"), the plaintiffs have not demonstrated
that the district court erred in applying
administrative exhaustion even if we assume
arguendo that the district court had the
discretion to excuse that failure on the ground
of futility. "In order to come under the futility
exception, the [plaintiffs] must show that it is
certain that their claim will be denied on
appeal, not merely that they doubt an appeal will
result in a different decision." Smith v. Blue
Cross & Blue Shield United of Wisc., 959 F.2d
655, 659 (7th Cir. 1992). Furthermore, "the
decision to require exhaustion as a prerequisite
to bringing suit is a matter within the
discretion of the trial court and may be
disturbed on appeal only when there has been a
clear abuse of discretion." Powell v. AT&T Comm.,
Inc., 938 F.2d 823, 825 (7th Cir. 1991).
After a review of the record, we conclude that
the district court did not abuse its discretion
in requiring the plaintiffs to exhaust their
administrative appeals. While it is true that the
1988 settlement agreement does not appear to
allow the Forest Service to re-open roads in the
Burke Branch and Atwood Ridge areas, the
agreement does not give any party the right to
compel the Forest Service’s compliance with that
obligation. It is possible that had the
plaintiffs pursued the available avenues for
administrative relief, the Forest Service would
have altered its decision to designate the Burke
Branch and Atwood Ridge areas as RNAs and would
have re-opened the closed roads in those areas.
The result of such an action would have been a
possible breach of the 1988 settlement agreement
and a consequent nullification of that agreement,
but the plaintiffs would have received the relief
that they sought. In this case the Forest
Service’s 1988 settlement agreement presents an
obstacle to the administrative actions requested
by the plaintiffs, but it does not render the
defendants powerless to grant the plaintiffs’
request. Under these circumstances, we cannot
conclude that the district court erred in
refusing to apply the futility exception to
excuse the plaintiffs’ failure to exhaust their
administrative remedies.
III. Conclusion
The district court correctly dismissed the
plaintiffs’ QTA and APA claims for lack of
subject matter jurisdiction. We accordingly AFFIRM
the decision of the district court.