California ex rel. Department of Transportation v. U. S. ex rel. Department of Transportation

561 F.2d 731
CourtCourt of Appeals for the Ninth Circuit
DecidedJune 22, 1977
DocketNo. 75-2284
StatusPublished
Cited by4 cases

This text of 561 F.2d 731 (California ex rel. Department of Transportation v. U. S. ex rel. Department of Transportation) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
California ex rel. Department of Transportation v. U. S. ex rel. Department of Transportation, 561 F.2d 731 (9th Cir. 1977).

Opinion

WALLACE, Circuit Judge:

The State of California sued the United States for reimbursement of interest paid in obtaining a voluntary right of entry for the construction of a portion of Interstate Highway 5. The district judge granted summary judgment to the United States on the ground that the provisions of Policy and Procedure Memorandum (PPM) 80 — 4, Ü 3i, a Federal Highway Administration directive,1 apply to limit the amount of interest which the United States is legally obligated to pay. We affirm.

I.

Pursuant to the provisions of the Federal-Aid Highways Act, 23 U.S.C. §§ 101 et seq., representatives of the federal government and the State of California entered into an agreement for the construction of a portion of Interstate 5 in Siskiyou County, California. As contemplated by the Act, the federal government agreed to pay 90% of the total cost of the project and the State agreed to undertake the actual construction, subject to the approval of the Secretary of Transportation. In connection with the construction of the highway, the State took steps to acquire the necessary right-of-way, including the parcel of land giving rise to this dispute.

Under California law, a condemnor may obtain from a landowner a voluntary right of entry upon land sought to be condemned prior to the actual condemnation, with interest based upon the final sales price accruing to the landowner from the date the condemnor makes his entry and takes possession of the property. People ex rel. Dept. of Public Works v. Williams, 30 Cal.App.3d 980, 106 Cal.Rptr. 795 (1973); Cal.Code Civ.Pro. § 1268.310. Interest continues to accrue by law until full payment [733]*733is made to the landowner. Cal.Code Civ. Pro. § 1268.320. With respect to the parcel involved in this case, the State obtained a voluntary right of entry and took possession on August 1, 1968. Pursuant to the agreement with the landowner and certain California statutes,2 interest accrued at 7% annually from that date until October 15, 1968, when the property was formally acquired by sale. As ultimately calculated, interest for this entire period was $1,169.01. The United -States reimbursed the State in the amount of $467.69, representing 90% of the interest for the first 30 days, but refused to participate in any further interest payment.

After exhausting its administrative remedies, California brought suit under the Tucker Act, 28 U.S.C. § 1346(a)(2), to recover $642.34, representing 90% of the interest for the remainder of the period before the sale was consummated. The district judge, granting the motion of the United States for summary judgment, found that the provisions of PPM 80 — 4, H 3i,3 “which limits payments for interest under the Federal Aid Highway Act to a period of thirty (30) days after the date payment is made available to the landowner, apply to situations in which plaintiff has taken a voluntary right of entry on a negotiated basis . . . .” Accordingly, the court held that the State was entitled to no further reimbursement.

II.

Our task on appeal is to determine whether the district judge was correct in granting summary judgment. There are two issues involved in the court’s decision: the validity of PPM 80 — 4, H 3i and the applicability of this section to voluntary rights of entry.

We resolved the first issue in California ex rel Dept. of Transportation v. United States ex rel. Dept. of Transportation, Federal Highway Administration, 547 F.2d 1388 (9th Cir., 1977), where we held that PPM 80 — 4, H 3i is consistent with the purposes and policies of the Federal-Aid Highways Act. Accordingly, the only issue remaining in this case is whether this directive can be interpreted as applicable to voluntary rights of entry.

In this case, the Federal Highway Administration has interpreted its policy pertaining to interest payments in excess of 30 days, i. e., PPM 80-4, H 3i, as being applicable to rights of entry.4 While not dealing with a rule, the Supreme Court has held that an interpretation of a regulation [734]*734by the issuing agency is entitled to great deference:

Since this involves an interpretation of an administrative regulation a court must necessarily look to the administrative construction of the regulation if the meaning of the words used is in doubt. [T]he ultimate criterion is the administrative interpretation, which becomes of controlling weight unless it is plainly erroneous or inconsistent with the regulation.

Bowles v. Seminole Rock & Sand Co., 325 U.S. 410, 413-14, 65 S.Ct. 1215, 1217, 89 L.Ed. 1700 (1945); accord, Udall v. Tallman, 380 U.S. 1, 16-17, 85 S.Ct. 792, 13 L.Ed.2d 616 (1965). See also Northern Indiana Public Service Co. v. Porter County Chapter of the Izaak Walton League, Inc., 423 U.S. 12, 15, 96 S.Ct. 172, 46 L.Ed.2d 156 (1975). Although the PPM may be an interpretative rule rather than a formal regulation, see California ex rel. Dept. of Transportation v. United States ex rel. Dept. of Transportation, Federal Highway Administration, supra, 547 F.2d at 1389-1390; Lathan v. Brinegar, 506 F.2d 677, 682 n. 6 (9th Cir. 1974) (en banc), administrative construction provides the best indication of the issuing agency’s intent in either case.5 Thus the same deference in interpretation is appropriate whether the PPM is a formal regulation or an interpretative rule. Accordingly, the issue before us is whether the Federal Highway Administration’s interpretation of PPM 80 — 4, 113i as applicable to rights of entry is plainly erroneous or inconsistent with the memorandum.

California contends that the Federal Highway Administration’s interpretation is inconsistent with the memorandum in two ways. First, it argues that the term “settlement” within paragraph 3i6 is usually understood in the context of litigation and hence does not refer to a settlement negotiated without the filing of a lawsuit. Upon an examination of the language of the memorandum as a whole, we find this to be too narrow a reading. First, PPM 80 — 4, by its title, deals with “Right-of-Way Procedures (Negotiations).” Thus it is clear from the title that the memorandum specifically contemplates the acquisition of a right-of-way through negotiation. Moreover, the memorandum itself speaks of “settlements” reached through both “condemnation procedures” and “negotiation.”7 Accordingly, the term “settlement,” when referring to the acquisition of right-of-way, is not restricted to usage involving litigation. “Settlement” may also refer to a settlement such as the one negotiated in this case.

Second, California argues that PPM 80 — 4, H 3i applies by its terms to circumstances where a partial payment is made.

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Bluebook (online)
561 F.2d 731, Counsel Stack Legal Research, https://law.counselstack.com/opinion/california-ex-rel-department-of-transportation-v-u-s-ex-rel-department-ca9-1977.