United States Court of Appeals

For the Eighth Circuit

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No. 17-2164

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Bottoms Farm Partnership; Bell Family Partnership; Bell Planting Co.; Nez Farms,

Inc.

Plaintiffs - Appellants

v.

Sonny Perdue, Secretary, United States Department of Agriculture; Risk

Management Agency; Federal Crop Insurance Corporation

Defendants - Appellees

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Appeal from United States District Court 

for the Eastern District of Missouri - St. Louis

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Submitted: March 15, 2018

Filed: July 17, 2018

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Before WOLLMAN, SHEPHERD, and ERICKSON, Circuit Judges.

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ERICKSON, Circuit Judge.

Bottoms Farm Partnership, Bell Family Partnership, Bell Planting Company,

and Nez Farms, Inc. (“Appellants” or “farmentities”) appealfroma grant ofsummary
judgment by the district court deferring to an insurance policy interpretation made

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by the Federal Crop Insurance Corporation (“FCIC”) and a determination regarding

the FCIC’s authority made by the Risk Management Agency (“RMA”). We affirm.

I. Background

The Appellants are rice farmers in southeast Missouri. They each planted rice

in Stoddard County during the 2012 crop year. The rice crops were insured under

federally-reinsured multi-peril crop insurance policies purchased from Rural Crop

Insurance Services(“RCIS”). The insurance policy was provided under the auspices

of the Federal Crop Insurance Act (“FCIA” or “Act”), which is administered by the

FCIC and the RMA. 

After the farmentities purchased the insurance and planted the 2012 crop, their

rice crops were damaged by excessive rainfall in Stoddard County. The farm entities

filed claims for indemnity with RCIS. RCIS denied the claims on the ground that the 

crops were not insurable under the policy because levees were not surveyed and

constructed immediately after seeding the rice and levee gates were not immediately

installed and butted as required by a special provision in the policy. The special

provision states:

In addition to the definition of Planted Acreage specified in section 1 of

the Crop Provisions, the following must have occurred immediately

following seeding. If these activities have not occurred, the acreage will

be considered “acreage seeded in any other manner” and will not be

insurable:

1. levees are surveyed and constructed;

2. levee gates are installed and butted; and

The Honorable Shirley Padmore Mensah, United States Magistrate Judge for

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the Eastern District of Missouri, sitting by consent of the parties pursuant to 28

U.S.C. § 636(c) and Fed. R. Civ. P. 73(a).

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3. the irrigation pump is operable, ready to be started in the

event sufficient rainfall has not been received, and turned

on to provide sufficient water for the purposes of

germination or elimination of soil crusting.

When the farm entities’ claims were denied, they sought arbitration with RCIS

as was mandated by the Basic Provisions of the policy. In their arbitration request,

they each stated their proposed interpretation for consideration. After considering the

arguments of the parties, the FCIC agreed with RCIS’s interpretation and provided

the following explanation:

Any time a term is not defined in the policy, its common meaning is

used and that isfound in any standard dictionary. The Merriam-Webster

dictionary defines “immediately” as “without any delay.” This means

the listed activities must occur right after planting has ended, weather

permitting, without any delay. If weather prevents these activities, they

must commence as soon as the weather permits.

Therefore,FCICdoes not agree with the [Appellant]’s interpretation that

the Special Provisions only require that such levees, levee gates, and

irrigation pumps as are required to enable the producer to put sufficient

water on the field in the event it is needed for purposes of germination

or the elimination of soil crusting, be in place immediately following

seeding. FCIC also does not agree that interior levees do not have to be

installed immediately following planting in order for the acreage to be

insurable.

The Special Provisions statement specifies what activities must occur

immediately following seeding[.] . . . .

These are specific activities that must occur on the insurable acreage

each year. These are not requirements that only need to occur if the

situation arises that requires the irrigation. The requirement is to

conduct these activities immediately after planting and are not governed

by the requirement that the producer follow good farming practice. This

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is a condition of insurability, not an issue of whether the producer

followed good farming practices.

The farm entities requested a review of the FCIC’s interpretation to the RMA. 

TheRMA found no error in the FCIC’s interpretation. The National Appeals division

concluded that RMA’s written interpretation was not appealable. With their

administrative remedies exhausted, the farmentities filed a complaint in district court,

which gives rise to this appeal. On appeal, the farm entities ask us to reverse the

district court and to set aside the FCIC’s interpretation. In the alternative, they seek

to set aside the RMA’s determination that the FCIC had authority to issue a binding

interpretation ofthe special provision. We have searchingly reviewed the record and,

giving due deference to the expert authority of the FCIC and the RMA, we affirm.

II. Discussion

A. Standard of Review and Statutory Guidance

“We review the district court’s judgment de novo.” Clark v. United States

Dep’t of Agriculture, 537 F.3d 934, 939 (8th Cir. 2008) (citing Central South Dakota

Co-op. Grazing Dist. v. Sec’y of the U.S. Dep’t of Agriculture, 266 F.3d 889, 894

(8th Cir. 2001)). Like the district court, we have limited authority to review

decisions of administrative agencies. 5 U.S.C. § 706(2). We may set aside the

decisions of the FCIC and the RMA only if we find them to be “arbitrary, capricious,

an abuse of discretion, or otherwise not in accordance with law” or “in excess of

statutory jurisdiction, authority, or limitations, or short of statutory right.” 5 U.S.C.

§ 706(2)(A), (C); Clark, 537 F.3d at 939.

When we review“an agency’s construction ofthe statute which it administers,”

we confront two questions:

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First, always, is the question whether Congress has directly spoken to

the precise question at issue. If the intent of Congress is clear, that isthe

end of the matter; for the court, as well as the agency, must give effect

to the unambiguously expressed intent of Congress. If, however, the

court determines Congress has not directly addressed the precise

question at issue, the court does not simply impose its own construction

on the statute, as would be necessary in the absence of an administrative

interpretation. Rather, if the statute is silent or ambiguous with respect

to the specific issue, the question for the court is whether the agency’s

answer is based on a permissible construction of the statute.

Chevron, U.S.A., Inc. v. NaturalResources DefenseCouncil, Inc., 467 U.S. 837, 842-

43 (1984). “Where Congress has established a clear line, the agency cannot go

beyond it; and where Congress has established an ambiguous line, the agency can go

no further than the ambiguity will fairly allow.” City of Arlington v. F.C.C., 569 U.S.

290, 307 (2013). “If ‘the agency’s answer is based on a permissible construction of

the statute,’ that is the end of the matter.” Id. (citing Chevron, 467 U.S. at 842). 

Congress established the federal crop insurance programin 1938 to “improv[e]

the economic stability of agriculture.” United States v. Hawley, 619 F.3d 886, 888-

89 (8th Cir. 2010) (quoting 7 U.S.C. § 1502(a)). “The Federal Crop Insurance Act

(FCIA), 7 U.S.C. § § 1501-1524,” provided that the crop insurance program would

be “administered and regulated by the FCIC,” a wholly owned government

corporation within the United States Department of Agriculture. Ace Property and

Casualty Ins. Co. v. Federal Crop Ins. Corp., 440 F.3d 992, 994 (8th Cir. 2006) (citing

7 U.S.C. § 1503); Hawley, 619 F.3d at 889 (citing § 1502(a) and 7 C.F.R. §

400.701). The RMA “administers the federal crop insurance program on behalf of

the FCIC.” Hawley, 619 F.3d at 889; 7 U.S.C. § 6933.

The FCIA provides that the management of the FCIC “shall be vested in a

Board of Directors subject to the generalsupervision ofthe Secretary” of Agriculture. 

7 U.S.C. § 1505(a)(1). The Act specifies what types of expertise must be represented

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in the Board’s composition. 7 U.S.C. § 1505(a)(2). The Act provides for “[e]xpert

review of policies, plans of insurance, and related material.” 7 U.S.C. § 1505(e). 

Congress allocated to the FCIC “such powers as may be necessary or appropriate for

the exercise of the powers . . . specifically conferred upon” it by the FCIA “and all

such incidental powers as are customary in corporations generally.” 7 U.S.C. §

1506(k).

Congress allocated to the FCIC powers that are customarily vested in

corporations. In describing the Corporation’s authority to offer insurance, Congress

specified: “If sufficient actuarial data are available (as determined by the

Corporation), the Corporation may insure, or provide reinsurance for insurers of,

producers of agricultural commodities grown in the United States under 1 or more

plans of insurance determined by the Corporation to be adapted to the agricultural

commodity concerned.” 7 U.S.C. § 1508(a)(1). The Act specifies the administrative

process for resolving issues of “good farming practices” that may arise under a

federal crop insurance policy. 7 U.S.C. § 1508(a)(3)(B). An administrative decision

regarding whether a producer failed to follow good farming practices “may not be

reversed or modified asthe result of judicial review unlessthe determination isfound

to be arbitrary or capricious.” 7 U.S.C. § 1508(a)(3)(B)(iii)(II). 

Congress requires the FCIC to offer “[s]pecial provisions for . . . rice.” 7

U.S.C. § 1508(a)(8). Specifically, the Act requires: “Notwithstanding any other

provision of this subchapter, beginning with the 2001 crops of . . . rice, the

Corporation shall offer plans ofinsurance, including prevented planting coverage and

replanting coverage, under this subchapter that cover losses of . . . rice resulting from

failure of irrigation water supplies due to drought and saltwater intrusion.” Id. 

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B. FCIC Interpretation of Special Policy Language

The clear language of the FCIA indicates that Congress intended the

Corporation to have extensive and broad authority. Under the Act judicial review 

is available but limited. Given the Act’s broad grant of authority to the Corporation,

and the specific authority over the provisions of insurance and insurance contracts

found in 5 U.S.C. §§ 1505 and 1506, we conclude that we must give substantial

deference to the FCIC’s interpretation of the special provision. Rain & Hail Ins.

Service, Inc. v. Federal Crop Ins. Corp., 426 F.3d 976, 979-80 (8th Cir. 2005) (giving

substantial deference to an agency’s interpretation because of the agency’s delegated

authority). 

The FCIC’s interpretation of the special provision is consistent with the plain

reading of the policy, which indicates that the activities listed must “have occurred

immediately following seeding” or the acreage will be considered to be uninsurable. 

The FCIC’s decision that the language provided a condition for insurability and was

not subject to an analysis of good farming policy is not plainly erroneous. Id. at 979. 

Further, the interpretation is not “‘arbitrary, capricious, an abuse of discretion, or

otherwise not in accordance with law,’ 5 U.S.C. § 706(2)(A), especially in view of

the substantial deference we give to the [FCIC] in this circumstance.” Id. at 980

(citations omitted). The interpretation is based on a permissible construction of the

policy language which was promulgated by the Corporation under its statutory

authority.

C. RMA Determination of FCIC Authority

The plain language of section 20(a)(1) of the farm entities’ crop insurance

policy required that the parties’ dispute in this matter be subject to mediation and

arbitration. The policy required the parties to present their disagreement over the

interpretation of policy language to the FCIC. Section 20(a)(1)(i) specifically states:

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“Any interpretation by FCIC will be binding in any mediation or arbitration.”

Considering the plain language of the insurance contract and the deference we must

give the RMA in its role of supervisor of the FCIC, we conclude that the RMA’s

determination that the FCIC was required to provide an interpretation of the special

provision to the arbitrating parties was not clearly erroneous, “arbitrary, capricious,

an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. §

706(2)(A). Rain & Hail, 426 F.3d at 979-80.

III. Conclusion

We affirm the judgment of the district court.

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