the government with interest because he was eligible to for a part payments under the statutes and regulations one of the main issues here is the definition of person in part fourteen hundred of the regulations it contains four parts only the first are in issue in this case the first part is extremely clear it says a person as an individual or corporation trust a state limited partnership or similar entity that's the definition of person that's to be used in eligibility determinations the second part of the definition is also clear it states they ought to be considered a separate person an individual or entity must have a separate interest in the landowner crop making separate responsibility for that and just and maintain separate funds or separate accounts from any other entity or individual this is the portion of the definition that's used to determine if one is a separate person for payment limitations purposes now the government's position in this case is in order to paula receive farm program payments and individual or entity must be a separate person there is no requirement to think in either the regulations or the statutes eligibility is based upon whether an individual or entity his farm operation plan that there was a related entity in which he had an interest and that was a little muddy l l c so that was forthright from the beginning provide a significant contribution of capital land or equipment or a combination of the three and active personal labor or active personal management or a combination of the two there is no requirement that capital be provided at all in order to be actively engaged in farming the actively engaged in  is the determination of eligibility for program payments once you're eligible for program payments then there's a determination of whether you in any other entities and which you have interests are separate or one person now herman was determined to be actively engaged in farming both initially in two thousand and five and at the end the end of year review when the review team made their results known in two thousand and ten he was determined to be actively engaged in farming based upon his country significant contribution of a quick and active personal labor and active personal man each of the farmer he's the farmer right no question about  and the county committee also found in its minutes that he met the actively engaged in farming criteria now the government's position of trying to read a separate person requirement into the eligibility determination based on actively engaged in farming is inconsistent with both the statutes and regulations and the context if we look at the structure of part fourteen hundred it has several parts some parts sub part a yes the general provisions sub part b is the person determination which is the determination of whether you are a separate person for payment limitation purposes and sub part c is the sub par that deals with you're actively engaged in farming so your argument is it doesn't make any difference whether during the course of the farm operations whether transactions were in the name of they are both actively engaged and now a little muddy was not a part of the terminations in this case it was not brought in to determine whether it was a set whether it was actively engaged you know that had been determined in a prior administrative proceeding and was not look they had when they were looking at wagner herman and whether they were separate that language comes in under sub part b which relates to the person determination of whether you're one person or more than one person for payment limitations purpose now there is no statute or regulation that says that in order to be eligible for payments you must be a separate person likewise there is nothing in the statute or regs that says that if you're not a separate person you cease to be a person but yet that's what the government's claim to understand you correctly that during the course of the farming operation covered by this program that on one or more occasions mr harmon used a little money l l c to obtain discounts on supplies seeds whatever necessary to the farming operation that he is an individual could not get is that correct that's correct your honor and that's a standard practice and that was in the record in terms of bulk purchasing to get it in nerd to the benefit of the program by receiving items at a discounted price that's correct your honor and that f s a has sat in and throughout the a correct in the understanding that if you reconstructed all of the payments received during the course of the operation this farming program and isolate of those ones that mr harmon was entitle to receive as an individual discounted any were much little muddy or somewhere some other entity was used that the hundred thirty six thousand dollars would have been what he had been entitled to if he had done all of this in his own name i hope and be clear question if i understand your question correctly and i think i do the answer is ye basketball association we call this no harm no foul all right and i think that's exactly what we have here because when you're making the per person determination and section fourteen hundred point one party specifically states that this part is used to determine whether individuals and entities are to be treated as one person separate persons for payment limitations purposes it doesn't say whether they're separate persons or not persons and and if you are to if they are determined to be one person then you and he together with the other entity that you're determined to be one person with is entitled to only the maximum amount of farm program payments per program per year that an individual person could get and little money l l c and wagner herman never exceeded that amount for any pro in any program in any of the years and so there was never any excess government funds spent if you want to save some for i q i'd like to save three minutes but i have one more they had separate or operating loans they had separate bank accounts they had no cross collateral sation of anything and that's all but the regs require and it's capricious for the agency to determine that they are not separate persons simply because the local f s a office would have preferred different accounting standards that weren't part of the regulations they weren't even part of the handbook provisions use to for the agency to follow for consistency purposes thank you thank you  remaining time please the court my name's temple tarka representing the united states department of agriculture this case reaches this course after a thorough process of review starting with an initial f s a county committee determination reconsideration of that determination followed by an appeal to the national appellate division with a hearing where mr harmon was represented by counsel a determination and appeal from there to the for director's review not to mention of course the summary judgment below given both the thoroughness of this review process and the complex and highly technical nature of f s a program regulations the agency's determination is entitled to substantial deference no what would be wrong with analyzing the course of payments during this program and reaching in accountants determination of which farm subsidy payments mr herman was eligible for in which he was not eligible for coming up with the number and deciding it from there it's wrong there i think the problem with that your honor is that  anything extra he did he did not give anything extra but there was the potential for him to get something extra one thing that might have been the potential but he didn't like to take it and hide it under the mattress he  well the way they describe it as a person is defined as either an individual or entity actively engaged in farming with respect to such operation so either one of those could be a person right according to regulation it's either an individual or an entity to be considered to be can yes you have actively engaged in farming with respect to such an operation so was he an individual or you have to you have to meet the way the agency interprets the statutes and the agencies interpretation is entitled to deference by this court that you have to meet both of the person requirement and the definition of person and fourteen hundred point three as well as the actively engaged in agriculture or actually engaged in farming germination those aren't are separate determinations and both of those have a basis in the statute if you go to seven u s c thirteen zero eight dash one b which is included in the appellate appendix for harmon in applying for benefits under this program indicated that he was engaged in farming and also disclosed his relationship with  little muddy and all seated and he indicated that he was a separate person and both he and little muddy applied as separate persons for the purpose of and is it correct that during the course of the farming operation he used little mudie's ability to boat purchase to save the farming operation money he he  yes he did use the book he did make payments through through a little money ranch so do we categorize that as no good deed goes unpunished or what i don't understand what you mean by a good deed he saved himself money he saved the operation money that's what the government was supplying funds for to maintain this farming operation and he saved that money by taking advantage of the l l much monies abilities for purchases correct he did save himself money that that that's correct and the purpose of these of these regulations are to to provide funds but here's the important distinction i think there's both little will muddy it and mr harmon applied to separate persons and as a part of that they have to maintain separate the chemicals and fertilizer for the sugar beet operation paid for the labor for the sugar beet operation and there was no bulk purchasing discount for that and paid for the beet seed did else a middle al mahdi receive funds it was not entitled to money that was yes it did there was an agency determination that it was not separately entitled to funds and that was a proceeding that happened prior to this one and was it ordered to repay those a i believe so your honor is that in the record that there's read the record of this case there is reference to the to the fact that little money and guard firemen were found to be ineligible in this  case that's in the record in this case the repayment repayments i assume happened but that is not in the record i would like to return to the language of the statute because i do think that's important seven u s c thirteen eight dash one cents to be separately eligible for a program pay and benefits with respect to a particular farming operation a person must be an individual or entity described in section thirteen o e two a of this title which is the regulations that provide the the definition of person and actively engaged in farming it's worth comparing that language with the language in fourteen hundred point to a one because the language from  statute says to be separately eligible for program farm program payments with respect to a particular farming operation the person must be an individual or entity and actively engaged in farming the language and the included in the statutory language isn't included in the regulatory language because that's covered under the definition of person in fourteen hundred point three and the agency interprets the that separateness requirement which again comes from congress but it has taken that language and included it in the definition of person in four hundred point three paragraph t payments for that the sugar beet operation of the direct payments and the farm crop insurance payments he immediately to pass those funds through to l a bell the same day and to the penny so this isn't a case where these are two separate operations that mr harmon was reimbursing certain expenses too little money this is a case where a little m incurred the bulk of the expenses and received the proceeds for that operation but they weren't operating as two separate persons using choose me for interrupting you i'm sorry but you told us that there was a separate proceeding involving little money correct yes right and a separate determination made whether it received farm program payments subsidies that it was not entitled to and that's over and done with yes and that's not part of this proceeding that review and the same result obtained is there's an important distinction i want to make clear i did think i do think i misstated before as a matter of law the agency came to the same determination with respect to mr harmon garth harmon and l m r that they weren't entitled the funds separately as a matter of equity the agency determined that that they were allowed to keep those funds as a matter of equity that the equity question is in review viewable by this court under this it you just shed a little light on that sir and there's a important factual faith in the regulations the agency representatives didn't testify in that case in the hearing this this case followed from that in the hearing before the national appellate division hearing officer in this case  f s a agents testified as well as mr harmon and his brother and the national television credited the f s a agents testimony that was a different factual record it's a different factual record again and a  more in depth one and again the credibility determination there which is entitle to deference from the national pellet division found that the f s a agents were credible in explaining to mr harmon the importance of maintaining separate funds and accounts if we reverse here to what extent what it what is going to be the impact you think on the agency going forward well if any then the definitions of these regulations govern the program payments from two thousand and five to two thousand and eight  are different regulations which which actually are relevant or at least relevant as as an intellectual matter here in starting in starting with the after the two thousand and eight farm bill so starting in two thousand and nine the agency changed the definition of person to be just an individual and then separately discusses into these and when it did that it took this separate requirement to maintain separate funds or accounts which had been in the definition of person and included it in fourteen hundred dot to a one it became subsection c of that section which i think is illustrated of of the fact that the and the agency practice continued to require separate so this case would be a one off in any event i know you don't like that term and i'm not terribly fond of it but but i do think again that the agencies interpretation of its regulations is entitled to deference here and that the definition of the definition that mr herman advocates would not be administer a bill for for the agency to apply one definition of person that doesn't require maintaining separate funds or accounts for purposes of eligibility for purposes of of providing funds and then a separate definition of person that does require separateness for raising this question in addressing the question of what the cats would be there are several points i'd like to respond to the first in terms of deference to the agency i think it's important to recognize that the position that the agency is taking in this litigation is not the same interpretation that the agency gave at the administrative level in this case the county committee in its minutes from july two thousand town and that is in the record states that way ignore herman can meet the qualifications for actively engaged in farming now the mistake about the county committee made is that they found that being a separate person was a separate requirement to be eligible for funds they did not relate that t o the actively engaged in farming which is the occupy which is the argument the government is making in the lead a cation in their litigation position so it is not entitled under case law from the ninth circuit and other circuits as well also i think it's important to note we heard a lot of herman's individual farming operations expenses were paid for by herman and all of the little mudie's operating expenses were paid for by little muddy now the government didn't like the harmon received a payment a farm program payment on sugar beets he used that money to pre pay some of the expenses for of all purchasing the little mud he was going to pay on his behalf once you received that what the government characterized as unexplained transfers that's what they were saying well there's no difference because when he got a program payment he immediately turned it over to law much baths you know once you receive an insurance payment a government payment  salary it's yours to do with as you see fit and if you use that to prepay or reimburse funds for bulk purchasing there certainly nothing wrong with that out or nothing suspect with fast thank you thank you both for your argument today the case just argued of harman versus the united states is submitted in