North Side Lumber Co. v. Block

753 F.2d 1482, 32 Cont. Cas. Fed. 73,261
CourtCourt of Appeals for the Ninth Circuit
DecidedFebruary 20, 1985
DocketNos. 84-3657, 84-3660, 84-3661 and 84-3776
StatusPublished
Cited by95 cases

This text of 753 F.2d 1482 (North Side Lumber Co. v. Block) 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
North Side Lumber Co. v. Block, 753 F.2d 1482, 32 Cont. Cas. Fed. 73,261 (9th Cir. 1985).

Opinions

GOODWIN, Circuit Judge.

The United States appeals from a preliminary injunction restraining it from enforcing contracts for the sale of national forest timber, and plaintiffs-intervenors appeal their exclusion from the benefits of the injunction. We vacate the injunction because the district court did not have jurisdiction of the cause of action on which it was based.

North Side, the class it represents, and plaintiffs-intervenors are timber companies that have contracts to cut and pay for timber in the national forests in Oregon and Washington.1 They brought this action against the Secretary of Agriculture and several of his subordinates, asking for a judgment declaring the contracts void and restraining the defendants from enforcing them. They did not seek money damages.

Because of a depressed market for lumber and logs, the timber companies can perform their contracts only at a loss. If they do not perform, they will be liable to the government for the difference between the contract price they agreed to pay for the timber and the price the same timber brings when the government resells it to new purchasers, plus interest. Either performance at a loss or default with payment of damages to the government will bankrupt at least some of the timber companies.

The district court preliminarily enjoined the Secretary from enforcing the contracts held by North Side and the class of 109 privately-held timber companies it represents. Several publicly-held timber companies, the “plaintiffs-intervenors,” were permitted to intervene in the action but were excluded from the plaintiff class and from the scope of the injunction. The Secretary and Lane County, which intervened as a defendant to protect its interest in the contracts, appeal from the district court’s grant of the preliminary injunction. The plaintiffs-intervenors appeal from the dis[1484]*1484trict court’s refusal to bring them under the protection of the injunction.

The timber companies make two claims for relief. The first, which we will refer to as the impracticability claim, asserts that contingencies unforeseen at the time the contracts were made render the contracts void under the contract law doctrines of commercial impracticability, frustration of purpose, and impossibility of performance. The second, which we will refer to as the statutory claim, asserts that enforcement of the contracts would violate 16 U.S.C. §§ 473-482 and the Multiple-Use Sustained-Yield Act of 1960, 16 U.S.C. §§ 528 et seq.2

The timber companies contend that both claims fall within the district court’s federal question jurisdiction, 28 U.S.C. § 1331. It is true that the claims arise under federal law as § 1331 requires. The statutory claim obviously involves federal statutes. The impracticability claim also arises under federal law because federal common law of contracts applies to contracts with the federal government, Saavedra v. Donovan, 700 F.2d 496, 498 (9th Cir.), cert. denied, — U.S.—, 104 S.Ct. 236, 78 L.Ed.2d 227 (1983), and federal common law is part of the “laws ... of the United States” for the purpose of § 1331 jurisdiction. Illinois v. Milwaukee, 406 U.S. 91,100, 92 S.Ct. 1385,1391, 31 L.Ed.2d 712 (1972).

But the analysis of jurisdiction cannot stop with § 1331, because the claims in this case are in essence against the federal government, and thus are barred by sovereign immunity unless the government has consented to suit.3 The timber companies contend that the Administrative Procedure Act, 5 U.S.C. § 702, waives the government’s sovereign immunity to this action. Section 702 reads in part:

An action in a court of the United States seeking relief other than money damages and stating a claim that an agency or an officer or employee thereof acted or failed to act in an official capacity or under color of legal authority shall not be dismissed nor relief therein be denied on the ground that it is against the United States or that the United States is an indispensable party.

The waiver of immunity is limited by the proviso of § 702 that

Nothing herein ... confers authority to grant relief if any other statute that grants consent to suit expressly or impliedly forbids the relief which is sought.

The Tucker Act, 28 U.S.C. §§ 1346 and 1491, is a “statute that grants consent to suit” on government contracts. We conclude that it impliedly forbids relief on the impracticability claim but not the statutory claim. It thus precludes a § 702 waiver of sovereign immunity on the impracticability claim. Moreover, on the impracticability claim, we have been able to identify from the record in this case no claim of an official action or failure to act within the meaning of 5 U.S.C. § 702. In the absence of such a claim, § 702 does not waive immunity-

The Tucker Act gives the United States Claims Court jurisdiction over “any claim against the United States founded ... upon any express or implied contract with the United States,” 28 U.S.C. § 1491(a)(1); it exercises this jurisdiction concurrently with the district courts for actions claiming less than $10,000. 28 U.S.C. § 1346(a)(2). The Act is more than just a grant of jurisdiction over government contract claims; it is also a limited waiver of sovereign immunity and a limita[1485]*1485tion on the remedies available in actions on government contracts. Megapulse, Inc. v. Lewis, 672 F.2d 959, 967 (D.C.Cir.1982). The Tucker Act has been construed as permitting the Claims Court to grant money damages against the government in contract actions but not injunctive or declaratory relief. United States v. King, 395 U.S. 1, 89 S.Ct. 1501, 23 L.Ed.2d 52 (1969) (Court of Claims may not grant declaratory relief); United States v. Jones, 131 U.S. 1, 9 S.Ct. 669, 33 L.Ed. 90 (1889) (Court of Claims may not grant equitable relief).4 These restrictions on the relief that the Claims Court may grant also limit the relief that the district courts may grant when exercising their concurrent Tucker Act jurisdiction under 28 U.S.C. § 1346(a)(2).

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Bluebook (online)
753 F.2d 1482, 32 Cont. Cas. Fed. 73,261, Counsel Stack Legal Research, https://law.counselstack.com/opinion/north-side-lumber-co-v-block-ca9-1985.