# U ni te d S ta te s Co ur t of A pp ea ls

For the Eig hth Circu it

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No. 1 7- 21 64

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Bo tt om s Fa rm

Part ne rs hi p; Bel l Fa m il y Part ne rs hi p; Bel l Pl an ti ng Co .; Nez F arm s, In c.

Pla in ti ff s - Ap pe ll an ts

v.

So nn y Perd ue , Secre ta ry , Uni te d S ta te s Dep art m en t o f Agr ic ul tu re; Ris k

Man ag em en t Ag en cy ; Fe de ral Cro p In su ran ce Co rp or at io n

Defe nd an ts - App el le es

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App eal fro m

Uni te d S ta te s Di st ric t Co ur t fo r th e Eas te rn Dis tri ct of M is so ur i - St . Lou is

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Su bm it te d: Marc h 1 5, 2 01 8
Fi le d: Ju ly 17, 2 01 8

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Befo re WOL LMAN, SHEPHERD, and ERICKSON, Ci rcu it Ju dg es

.

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ERICKSON, Ci rcu it Ju dg e.

Bo tt om s Fa rm

Part ne rs hi p, Be ll Fam il y Part ne rs hi p, Be ll Pla nt in g C om pa ny,

an d Nez Farm s, In c. (“ App el la nt s” or “ farm en ti ti es ”) ap pe al fro m a gr an t of su m m aryjud gm en t by t he di st ric t co ur t de ferr in g to an in su ran ce po li cy in te rp ret at io n m ad e 1
by th e Fed eral Cro p In su ran ce Co rp or at io n (“ FCIC ”) an d a de te rm in at io n reg ard in g
th e FCIC ’s au th or it y m ad e by th e Ri sk Man ag em en t Age nc y (“ RMA” ). W e affi rm

.

I. Ba ck gr ou nd

The App el la nt s are ric e farm ers in so ut he as t Mi ss ou ri. The y each pl an te d ric e
in St od da rd Co un ty du rin g th e 2 0 1 2 c ro p y ear. The ric e cro ps were in su red un de r
fed era l l y- r e in su red m

ul ti -p eri l cro p in su ran ce po li ci es pu rch as ed fro m Ru ral Cro p

In su ran ce Serv ic es (“ RCIS ”). The in su ran ce po li cy was pr ov id ed un de r th e au sp ic es
of th e Fed eral Cro p In su ran ce Act (“ FCIA” or “ Act” ), whi ch is ad m in is te red by the

FCIC an d t he RMA.

Afte r th e farm en ti ti es pu rch as ed th e in su ran ce an d pl an te d th e 20 12 cro p, th ei r
ric e cro ps were da m ag ed by ex ces si ve rai nf al l in St od da rd Co un ty. The farm en ti ti es
fil ed cl ai m s fo r in de m

ni ty wit h RCIS

. RCIS de ni ed th e cl ai m s on th e gr ou nd th at th e

cro ps were no t in su rab le un de r th e po li cy be cau se le ve es were no t su r ve y ed an d

co ns tru ct ed im m ed ia te ly aft er se ed in g th e ric e an d le ve e ga te s were no t im m ed ia te ly

in st al le d an d bu tt ed as req ui red by a sp eci al pr ov is io n in th e po li cy

. Th e s pe ci al

pr ov is io n s ta te s:

In ad di ti on to th e de fin it io n of Pl an te d Acrea ge sp eci fie d in se ct io n 1 of
th e Cro p P r o v i si on s, th e fo ll owi ng m us t ha ve oc cu rred im m ed ia te ly
fo ll owi ng se ed in g. If th es e act iv it ie s ha ve no t oc cu rred

, th e acre ag e wil l
be c o ns id ered “ acre ag e se ed ed in an y ot he r m an ne r” an d wil l no t be
in su rab le : 1. le ve es are s ur ve y ed an d c on st ru ct ed ; 2. le ve e g at es are i ns ta ll ed an d b ut te d; an d

The Hon or ab le Sh irl ey Pad m or e Men sa h, Uni te d St at es Mag is tra te Ju dg e fo r 1

th e East ern Dis tri ct of Mi ss ou ri, si tt in g by co ns e nt of th e pa rti es pu rs ua nt to 28 U.S.C. § 6 36 (c) a nd Fed . R. Civ . P. 73 (a).

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-3. th e irr ig at i o n p u m p is op erab le

, read y to be st art ed in th e

ev en t s uf fic ie nt rai nf

al l h as no t b een rece iv ed , and tu rn ed

on to pr ov id e su ffi ci en t wate r fo r t he pu rp os es of

ge rm in at io n o r el im in at io n o f so il cru st in g.

W he n th e farm en ti ti es ’ cl ai m s were de ni ed

, th ey so ug ht arb it rat io n wit h RCIS

as was m an da te d by th e Bas ic Pro vi si on s of the po li cy

. In th ei r arb it rat io n req ue st

, th ey each st at ed th ei r pr op os ed in te rp ret at io n fo r co ns id erat io n. Afte r co ns id eri ng th e

arg um en ts of th e pa rti es , t he F C I C ag reed wit h RCIS ’s i nt erp ret at io n an d pr ov id ed

th e fo ll owi ng ex pl an at io n:

Any ti m e a te rm is no t de fin ed in th e p o l i c y , it s co m m on m ean in g is

us ed an d th at is fo un d in an y st an da rd di ct io na ry

. The Mer ria m -Webs te r di ct io na ry de fin es “ im m ed i a t el y ” as “ wit ho ut an y de la y .” Thi s m ean s th e li st ed act iv it ie s m

us t o ccu r rig ht aft er pl an ti ng ha s en de d, weat he r
pe rm it ti ng , wit ho ut an y de la y

. If weat he r pr ev en ts th es e act iv it ie s, th ey

m us t co m m en ce as so on as t he weat he r pe rm it s.

The re fo re , FC IC doe s no t ag ree wit h th e [Ap pe ll an t]’ s in te rp ret at io n th at th e Sp eci al Pro vi si on s on ly req ui re th at su c h l e ve es , le ve e ga te s, an d
irr ig at io n pu m

ps as are req ui red to en ab le th e pr od uc er to pu t su ffi ci en t

wate r on th e fie ld in th e ev en t it i s n eed ed for pu rp os es of g erm in at io n

or th e el im in at io n of so il cru st in g , be in pl ace im m ed ia te ly fo ll owi ng

se ed in g. FCIC al so do es no t ag ree th at in te rio r le ve es do no t ha ve to be
in st al le d i m

m ed ia te ly foll owi ng pl an ti ng in ord er fo r th e acre ag e to be
in su rab le

.

The S p e c i a l Pro vi si on s st at em en t sp eci fie s wha t act iv it ie s m us t oc cu r im m ed ia te ly foll owi ng see di ng [.]

. . . .

The se are sp eci fic act iv it ie s th at m us t oc cu r on th e in su rab l e a c r e ag e each y ear. The se are no t req ui rem en ts th at on ly ne ed to oc cu r if th e si tu at io n ari se s th at r e q u i r e s th e irr ig at io n. The req ui rem en t is to

co nd uc t th es e act iv it ie s im m ed ia te ly aft er pl an ti ng an d are no t go ve rn ed by th e req ui rem en t th at th e pr od uc er fo ll ow go od farm in g pr act ic e. Thi s

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-is a co nd it io n of in su rab il it y , no t an is su e o f w h e t he r th e pr od uc er

fo ll owe d g oo d fa rm in g p ract ic es

.

The farm en ti ti es req ue st ed a rev ie w of th e FCIC ’s in te rp ret at io n to th e RMA.

The RMA fo un d no erro r in th e FCIC ’s in te rp ret at io n. The Nati on al App eal s di vi si on

c o n cl ud ed th at RMA’s writ te n in te rp ret at io n was no t ap pe al ab le

. W it h th e i r
ad m in is tra ti ve rem ed ie s ex ha us te d, th e farm en tit ie s fi le d a co m pl ai nt in di st ric t co ur t,

whi c h g i v e s r i s e to th is ap pe al

. On ap pe al

, th e farm en ti ti es as k us to rev ers e th e
di st ric t co ur t an d to se t as id e th e FCIC ’s in te rp ret at io n. In th e al te rn at iv e, th ey se ek

to se t as id e th e RMA’s de te rm in at io n th at th e FCIC ha d au th or it y to is su e a bi nd in g
in te rp ret at io n of th e sp eci al pr ov is io n. W e ha ve se arch in gl y rev ie wed th e reco rd an d,
gi vi ng du e d efer en ce t o t he ex pe rt a ut ho rit y of t he FCIC an d t he RMA, we aff irm.

II

. Dis cus si on

A. Sta nda rd o f Rev ie w an d Sta tuto ry Gui da nce

“ W e rev i e w t h e di st ric t co ur t’s jud gm en t de no vo .” Cl ark v. Uni te d St at es Dep ’t of Agr ic ul tu re, 53 7 F.3 d 93 4, 93 9 (8 th Ci r. 20 08 ) (ci ti ng Cen tra l So ut h Dak ot a

Co -o p. Grazi ng Dis t. v. Sec’y of th e U.S

. Dep ’t of Agr ic ul tu re, 26 6 F.3 d 88 9, 89 4
(8 th Ci r. 20 01 )). Lik e t h e d is tri ct co ur t, we ha ve li m it ed au th or it y to rev ie w
de ci si on s of ad m i n i s tra ti ve ag en ci es

. 5 U.S.C. § 70 6( 2)

. W e m ay se t as id e th e
de ci si on s of th e FCIC an d th e RMA on ly if we fin d th em to be “ arb it rary, cap ric io us ,

a n a bu se of di sc ret io n, or ot he rwis e no t in acco rd an ce wit h la w” or “ in ex c e s s o f

st at ut or y juri sd ic ti on , aut ho rit y , o r li m it at io ns , or s ho rt o f st at ut or y rig ht .” 5 U.S.C.
§ 7 06 (2 )(A), (C) ; Cl ark , 53 7 F .3d at 9 39

.

W he n we rev ie w “ an ag en cy ’s co ns tru ct io n of th e st at ut e whi ch it ad m in is te rs ,”

we co nf ro nt two qu es ti on s:

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-Fi rs t, al way s, is th e qu es ti on whe th er Co ng res s ha s di rect ly sp ok en to

th e pr eci se qu es ti on at is su e. If th e in te nt of Co ng res s is cl ear, th at is th e

en d o f th e m at te r; f

or th e co ur t, as well as t he ag en cy , m us t g iv e eff

ect

to th e un am

bi gu ou sl y ex pr es se d in te nt of Co ng res s

. I f

, h owe ve r, th e

co ur t de te rm in es Co ng res s ha s no t di rect ly ad d r e ss ed th e pr eci se
qu es ti on at is su e, th e co ur t do es no t si m pl y im po se it s own co ns tru ct io n

on th e st at ut e, as wou ld be ne ces sa ry in th e ab se nc e of an ad m in is tra ti ve in te rp ret at io n. Rat he r, if th e st at ut e is si le nt or am bi gu ou s wit h res pe ct

to th e sp eci fic is su e, th e q ue st io n fo r th e co ur t i s wh et he r th e ag en cy ’s

an swe r is ba se d o n a pe rm is si bl e co ns tru ct io n o f th e st at ut e.

Ch ev ro n, U.S.A., In c. v. Natu ral Res ou rces Defen se Co un ci l, In c., 46 7 U.S. 83 7, 84 2-

43 (1 98 4)

. “ W he re Co ng res s ha s es ta bl is he d a cl ear li ne , t h e a g en cy can no t go
be y on d it ; an d whe re Co ng res s ha s es ta bl is he d an am bi gu ou s li ne , th e ag en cy can go

no fu rth er th an th e am

bi gu it y wil l fai rly al lo w.” Ci ty of Arli ng to n v. F.C.C., 56 9 U.S.

29 0, 30 7 (2 01 3)

. “ If ‘the ag en cy ’s an swe r is ba se d on a pe rm is si bl e co ns tru ct io n of

th e st at ut e,’ tha t i s t he en d o f th e m at te r.” Id . (ci ti ng Ch ev ro n, 4 67 U.S. at 8 42 ).

Co ng res s es ta bl is he d th e fed eral cro p in su ran ce pr og ram in 19 38 to “ im pr ov [e]

th e eco no m ic st ab il it y of ag ric ul tu re.” Uni te d St at es v. Hawle y , 61 9 F.3 d 88 6, 88 8-

89 (8 th Ci r. 20 1 0 ) ( q u ot in g 7 U.S.C. § 15 02 (a))

. “ The Fed eral Cro p In su ran ce Act
(FCI A), 7 U.S.C. § § 15 01 -1 52 4,” pr ov id ed th at th e cro p i ns ur an ce p ro gr am wou ld

be “ ad m in is te red an d reg ul at ed by th e FCIC

, ” a who ll y own ed go ve rn m en t

co rp or at io n wit hi n th e Uni te d St at es Dep art m en t of Agri cu lt ur e. Ace Pro pe rty an d

Cas ua lt y In s. Co

. v. Fed eral Cro p In s. Co rp ., 44 0 F.3 d 99 2, 99 4 (8 th Ci r. 20 06 ) (ci ti ng

7 U.S.C. § 15 03 ); Hawle y , 61 9 F.3 d at 88 9 (ci ti ng § 15 02 (a) an d 7 C.F

. R

. §

40 0.7 01 ). The RM A “ ad m in is te rs th e fed eral cro p in su ran ce pro gr am on be ha lf o f

th e FCI C.” Hawl ey , 61 9 F .3d at 8 89 ; 7 U.S.C. § 6 93 3.

The FCIA pr ov id es th at th e m an ag em en t o f th e FCIC “ sh al l be ve st ed in a

Bo ard of Dire ct or s su bjec t to th e ge ne ral su pe rv is io n of th e Secr et ary” of Agr ic ul tu re.

7 U.S.C. § 15 05 (a)( 1)

. The Act sp eci fie s wha t types of ex pe rti se m us t be rep res en te d

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-in th e Bo ard ’s com po si ti on . 7 U.S.C. § 15 05 (a)( 2)

. The Act pro vi de s fo r “ [e]xp ert

rev ie w of po li ci es , pl an s of in su ran ce, an d rel at ed m at eri al .” 7 U.S. C

. § 1 5 0 5 ( e).

Co ng res s al lo cat ed to th e FCIC “ su ch po wers as m ay be ne ces sa ry or ap pr op ria te fo r
th e ex erci se of th e po wers

. . . s pe ci f i c a l l y c o n f

e rred up on ” it by t he FCIA “ an d al l

su ch in ci de nt al po w e r s a s are cu st om ary in co rp or at io ns ge ne ral ly.” 7 U.S.C. §

15 06 (k ).

Co ng res s al lo cat ed to th e FCIC po wers th at are cu st om ari ly v e s t e d in

co rp or at io ns

. In de sc rib in g th e Co rp or at io n’s au th or it y to of fer in su ran ce, Co ng res s

sp eci fie d: “ If su ffi ci en t act ua ria l d a t a a re av ai la bl e (as de te rm in ed by th e

Co rp or at io n)

, th e Co rp o r a t i o n m ay in su re, or pr ov id e rei ns ur an ce fo r in su rers of

,
pr od uc ers of ag ric ul tu ral co m m od it ie s gr own in th e Uni te d St at es un de r 1 o r m or e

p la ns of in su ran ce de te rm in ed by th e Co rp or at io n to be ad ap te d to th e ag ric ul tu ral

co m m od it y co nc ern ed .” 7 U.S.C. § 15 08 (a)( 1)

. The Act sp eci fie s th e ad m in is tra ti ve

pr oc es s fo r res ol vi ng is su es of “ go od farm in g pr act ic es ” th at m ay ari s e u n d e r a
fed eral cro p in su ran ce po li cy

. 7 U.S.C. § 15 08 (a)( 3) (B). An ad m in is tra ti ve de ci si on

reg ard in g whe th er a pr od uc er fai le d to fo ll ow g o o d farm in g pr act ic es “ m ay no t be

rev ers ed or m od ifi ed as th e res ul t of jud ic ia l rev ie w un le ss th e de te rm in at io n is fo un d

to be arb it rary or cap ric io us .” 7 U.S.C. § 15 08 (a)( 3) (B)( ii i)( II).

Co ng res s req ui res th e FCIC to of f e r “[s ]p e c i a l pr ov is io ns fo r

. . . ric e.” 7

U.S.C. § 15 08 (a)( 8)

. S p e c ifi cal ly, th e Act req ui res : “ Not wit hs ta nd in g an y ot he r

pr o v i s i o n o f th is su bc ha pt er, be gi nn in g wit h th e 20 01 cro ps of

. . . ric e, th e

Co rp or at io n sh al l of

fer pl an s of in su ran ce, in cl ud in g pr even te d plant in g co ve rag e an d

rep la nt in g co ve rag e, un de r th is su bc ha pt er th at co ve r lo ss es of

. . . ric e res ul ti ng fro m
fai lu re o f ir rig at io n wat er s up pl ie s d ue to dro ug ht an d s al twat er i nt ru si on .” Id

.

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-B. FCIC In terp reta tio n o f Spec ia l Po li cy La ng ua ge

The cl ear la ng ua ge of th e FCIA in di cat es th at C on gr es s in te nd ed th e

Co rp or at io n to ha ve ex te ns iv e an d br oa d au t h o r i t y

. Und er th e Act jud ic ia l rev ie w
is av ai la bl e bu t li m it ed

. Giv en th e Act’s br oa d gr an t of au th or it y to th e Co rp or at io n,

an d th e s p e ci fic au th or it y ov er th e pr ov is io ns of in su ran ce an d in su ran ce co nt ract s
fo un d in 5 U.S.C. §§ 15 05 a n d 15 06

, we co nc lu de th at we m us t gi ve su bs ta nt ia l

de fere nc e to th e FCIC ’s in te rp ret at io n of th e sp e c ia l pr ov is io n. Rai n & Hail In s.

Serv ic e, In c. v. Fed eral Cro p In s. Co rp ., 42 6 F.3 d 97 6, 97 9- 80 (8 th Ci r. 20 05 ) (g iv in g

su bs ta nt ia l de fere nc e to an ag en cy ’s in te rp ret at io n be cau se of th e ag en cy ’s de le ga te d

au th or it y ).

The FCIC ’s in te rp ret at io n of th e sp eci al pr ov is io n is co ns is te nt wit h th e pl ai n
read in g of th e po li cy , wh ic h in di cat es th at th e a c t i vi ti es li st ed m us t “ ha ve oc cu rred

im m ed ia te ly fo ll owi ng se ed in g” or th e acre ag e wil l be co ns id ered to be un in su rab le

. The FCIC ’s de ci si on th at th e la ng ua ge pr ov id ed a co nd it io n fo r in su rab il it y an d was

no t su bjec t to an an al y si s of go od farm in g po li cy is no t pl ai nl y erro ne ou s. Id

. at 97 9.

Fu rt h e r , t he in te rp ret at io n is no t “ ‘arbi tra ry , cap ric io us , an ab us e of di sc ret io n, or

ot he rwis e no t in acco rd an ce wit h la w,’ 5 U.S.C. § 70 6( 2) (A), es pe ci al ly in vi ew of

th e su bs ta nt ia l de fere nc e we gi ve to th e [FCI C] in th is ci rcu m st an ce.” Id

. at 98 0
(ci ta ti on s om it te d)

. The in te rp ret at io n is ba se d on a pe rm is si bl e co ns tru ct io n of the

po li cy la ng ua ge whi ch was pr om ul ga te d by th e Co rp or at io n un de r it s st at ut or y

au th or it y

.

C. RMA Determina tio n o f FCIC Autho ri ty

The pl ai n la ng ua ge of se ct io n 20 (a)( 1) of th e farm en ti ti es ’ cro p in su ran ce

po li cy req ui red th at th e pa rti es ’ di sp ut e in th is mat t e r b e su bjec t to m ed ia ti on an d

arb it rat io n. The po li cy req ui red th e pa rti es to pr es en t th ei r di sa gr eem en t ov er th e
in te rp ret at io n of po li cy la ng ua ge to th e FCIC

. Sect io n 20 (a)( 1) (i) sp eci fic al ly st at es :

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-“An y in te rp ret at io n by FCIC wil l be bi nd in g in an y m ed ia ti on or arb it rat io n.”

Co ns id eri ng th e pl ai n la ng ua ge of th e in su ran ce co nt ract an d th e de fere nc e we m us t gi ve th e RMA i n i t s r ol e of su pe rv is or of th e FCIC

, we co nc lu de th at th e RMA’s

de te rm in at io n th at th e FCIC was req ui red to pr ov id e an in te rp ret at io n of th e sp eci al

pr ov is io n to th e arb it rat in g pa rti es was no t cl earl y erro ne ou s, “ arb it rary, cap ric io us ,

an ab us e o f d i s c r e t i on , or ot he rwis e no t in acco rd an ce wit h la w.” 5 U.S.C. §

70 6( 2) (A). Rai n & Hail , 42 6 F .3d at 9 79 -8 0.

II I. Con cl us io n

W e aff irm th e jud gm en t o f th e d is tri ct co ur t.

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