DeVries v. United States

28 Fed. Cl. 496, 1993 U.S. Claims LEXIS 58, 1993 WL 194640
CourtUnited States Court of Federal Claims
DecidedJune 8, 1993
DocketNo. 92-127C
StatusPublished
Cited by5 cases

This text of 28 Fed. Cl. 496 (DeVries v. United States) is published on Counsel Stack Legal Research, covering United States Court of Federal Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
DeVries v. United States, 28 Fed. Cl. 496, 1993 U.S. Claims LEXIS 58, 1993 WL 194640 (uscfc 1993).

Opinion

ORDER

HARKINS, Senior Judge:

Plaintiffs’ claims are before the court on cross-motions for summary judgment. Oral argument was heard on June 4, 1993.

The complaint in this case asserts claims for breach of a contract between plaintiffs and the Commodity Credit Corporation (CCC) in the Conservation Reserve Program (CRP) of the Department of Agriculture. 16 U.S.C. §§ 3831-36 (1988); 7 C.F.R. §§ 704.1-.27 (1993). The contract was signed February 19, 1988, and became effective on May 3, 1989, for a 10-year period. On July 28, 1989, plaintiffs filed a bankruptcy petition in the United States Bankruptcy Court for the Western District of Wisconsin, pursuant to 11 U.S.C., Chapter 7. The CRP contract, listed as an exec-utory contract in the bankruptcy petition, was not assumed by the trustee in bankruptcy.

The CRP is administrated on behalf of the CCC by the Administrator of the Agricultural Stabilization and Conservation Service (ASCS), through state and county ASCS committees in every state. On October 30, 1989, the county ASCS terminated the CRP contract on the ground that 11 U.S.C. § 365(d)(1), on executory contracts, stated that if the trustee in a Chapter 7 case does not assume the contract within 60 days after the order for relief, such contract is deemed rejected. On appeal, the termination was reaffirmed by the county ASCS, sustained by the state ASCS and, on November 2, 1990, by the Deputy Administrator, State and County Operations (DASCO).

Plaintiffs in February 1991 filed a motion to reopen the bankruptcy case to enforce the CRP contract, alleging that the ASCS/ CCC termination of the CRP contract constitutes discriminatory treatment under 11 U.S.C. § 525. The bankruptcy court issued its opinion on July 22, 1991, holding that plaintiff had failed to show a violation of Section 525. The court found that the CRP contract was an executory contract, that pursuant to Section 365(d)(1) the contract was “deemed rejected,” and, pursuant to Section 365(g)(1), that rejection constitutes statutory breach of the contract.

The issue presented in the cross-motions for summary judgment is whether the prior adjudication before the bankruptcy court precludes litigation in this court on the issues raised in plaintiffs’ complaint.

At the close of argument, a bench ruling was made and the reasons for the decision were stated on the record. The following was decided:

On the record before the court, there are no genuine factual disputes between the [498]*498parties, and disposition by summary judgment procedures is appropriate. Summary judgment is required if there is “no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” RCFC 56(c); Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970). The movant has the burden of demonstrating that there are no genuine issues of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). Where both parties move for summary judgment, the court must evaluate each party’s motion on its own merits, taking care to draw all reasonable inferences against the party whose motion is under consideration. Mingus Constructors, Inc. v. United States, 812 F.2d 1387, 1391 (Fed.Cir.1987). To defeat a summary judgment motion, an opposing party “must proffer countering evidence sufficient to create a genuine factual dispute.” Sweats Fashions, Inc. v. Pannill Knitting Co., 833 F.2d 1560, 1562 (Fed.Cir. 1987).

As affirmative defenses, defendant contends both the doctrine of res judicata and the doctrine of collateral estoppel apply to plaintiffs’ claims. Defendant argues that the prior adjudication in the bankruptcy court precludes plaintiffs from litigating their claims in this court. Plaintiffs argue that the bankruptcy litigation involved a different cause of action, and that the bankruptcy forum did not offer the full procedural and substantive relief offered by the Court of Federal Claims.

Res judicata, commonly referred to as claim preclusion, provides that when a court of competent jurisdiction enters a final judgment on the merits of an action, the parties and their privies are barred from bringing a subsequent suit based on the same cause of action. Federated Dep’t Stores, Inc. v. Moitie, 452 U.S. 394, 398, 101 S.Ct. 2424, 2427, 69 L.Ed.2d 103 (1981); Alyeska Pipeline Serv. Co. v. United States, 688 F.2d 765, 769 (Ct.Cl.1982), cert. denied, 461 U.S. 943, 103 S.Ct. 2120, 77 L.Ed.2d 1301 (1983). Claim preclusion prevents relitigation of all claims that were actually litigated as well as claims that could have been litigated. Res judicata consequences of a final judgment on the merits are not altered by the fact that the judgment may have been wrong or rested on a legal judgment principle subsequently overruled in another case. Federated, 452 U.S. at 398, 101 S.Ct. at 2427. The rationale underlying the doctrine of claim preclusion rests on considerations of fairness, sound judicial administration, and finality. Restatement (Second) of Judgments § 19 cmt. a (1982); Federated, 452 U.S. at 401, 101 S.Ct. at 2429, quoting, Baldwin v. Traveling Men’s Assn., 283 U.S. 522, 525, 51 S.Ct. 517, 517-18, 75 L.Ed. 1244 (1931).

Application of res judicata “requires that: (1) the court’s prior decision must be a valid and final judgment, (2) the suit before the court must involve the same claim or cause of action as in the prior decision, (3) the prior decision must have been on the merits of the case, and (4) the same parties must be involved in both cases.” Mosca v. United States, 224 Ct.Cl. 678, 679 (1980). The present suit cannot satisfy the second criteria.

There are four factors to consider before finding that the present case presents the same cause of action as the previous decision. These four are “whether the present action (1) rests on the same principle of substantive and procedural law, (2) involves the same right alleged to be infringed by the same wrong, (3) has the same evidence to support both claims, and (4) has the same operative facts.” Mosca, 224 Ct.Cl. at 679.

The case at bar does not rest on the same cause of action as the prior bankruptcy proceeding. Plaintiffs’ previous bankruptcy proceeding failed to embrace the merits of the present action. In the bankruptcy proceeding plaintiffs attempted to show a government violation of Section 525(a) of the Bankruptcy Code.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Estabrook v. United States
41 Fed. Cl. 283 (Federal Claims, 1998)
Phoenix Petroleum Co. v. United States
42 Cont. Cas. Fed. 77,301 (Federal Claims, 1998)
Allenfield Associates v. United States
42 Cont. Cas. Fed. 77,267 (Federal Claims, 1998)
Martin v. United States
30 Fed. Cl. 542 (Federal Claims, 1994)
Neves v. Brown
6 Vet. App. 177 (Veterans Claims, 1993)

Cite This Page — Counsel Stack

Bluebook (online)
28 Fed. Cl. 496, 1993 U.S. Claims LEXIS 58, 1993 WL 194640, Counsel Stack Legal Research, https://law.counselstack.com/opinion/devries-v-united-states-uscfc-1993.