Source: https://law.justia.com/cases/federal/appellate-courts/F3/121/630/481434/
Timestamp: 2019-11-17 07:58:04
Document Index: 133767155

Matched Legal Cases: ['§ 2201', '§ 1506', '§ 103', '§ 1506', '§ 106', '§ 1508', '§ 1508', '§ 106', '§ 1508', '§ 1108', '§ 1508', '§ 57', '§ 1508', '§ 1508', '§ 1508', '§ 400', '§ 2', '§ 7', '§ 7']

Williams Farms of Homestead, Inc., a Florida Corporation Andhilson Farms, Inc., a Florida Corporation,plaintiffs-appellants, v. Rain and Hail Insurance Services, Inc., a Delawarecorporation and Cigna Property and Casualtyinsurance Company, a Delawarecorporation, Defendants-appellees.alger Farms, Inc., Plaintiff-appellant, v. Crop Growers, Inc. and Continental Insurance Company, Asubsidiary of Continental Corporation, Defendants-appellees, 121 F.3d 630 (11th Cir. 1997) :: Justia
Justia › US Law › Case Law › Federal Courts › Courts of Appeals › Eleventh Circuit › 1997 › Williams Farms of Homestead, Inc., a Florida Corporation Andhilson Farms, Inc., a Florida Corporatio...
Williams Farms of Homestead, Inc., a Florida Corporation Andhilson Farms, Inc., a Florida Corporation,plaintiffs-appellants, v. Rain and Hail Insurance Services, Inc., a Delawarecorporation and Cigna Property and Casualtyinsurance Company, a Delawarecorporation, Defendants-appellees.alger Farms, Inc., Plaintiff-appellant, v. Crop Growers, Inc. and Continental Insurance Company, Asubsidiary of Continental Corporation, Defendants-appellees, 121 F.3d 630 (11th Cir. 1997)
US Court of Appeals for the Eleventh Circuit - 121 F.3d 630 (11th Cir. 1997) Sept. 9, 1997
Following denial of their claims, Williams and Hilson filed an action against Cigna and Rain & Hail, and Alger filed an action against Continental and Crop Growers. The district court consolidated the two actions pursuant to Fed. R. Civ. P. 42(a). The complaints assert the existence of both federal question jurisdiction by virtue of the FCIA and diversity jurisdiction. The plaintiffs seek (1) a declaratory judgment, pursuant to 28 U.S.C. § 2201, interpreting the term "practical to replant," and (2) damages for breach of contract. The FCIC is not a party.
Our inquiry is two-fold. We must first decide whether the district court correctly concluded that the FCIA does not authorize a suit by the insured against its private insurance company. If we conclude that the district court is correct in this conclusion, we must then decide whether the FCIA preempts a suit against a private insurance company reinsured by the FCIC. These conclusions by the district court are conclusions of law over which we have plenary review. See Gold Kist v. C.I.R., 110 F.3d 769, 771 (11th Cir. 1997).
Since the original 1938 version of the FCIA, Congress has allowed the FCIC to "sue and be sued in its corporate name." 7 U.S.C. § 1506(d). As part of the 1980 amendment, Congress granted exclusive original jurisdiction over suits brought by or against the FCIC to the federal district courts. Previously, federal district courts and state courts shared concurrent jurisdiction over such actions. Pub. L. No. 96-365, § 103(2), 94 Stat. 1313, 1317 (1980) (codified as amended at 7 U.S.C. § 1506(d)).
After the 1980 amendment deleted a reference to state courts, the FCIA contained the following provision regarding actions against the FCIC: "In the event that any claim for indemnity under the provisions of this chapter is denied by the [FCIC], an action on such claim may be brought against the [FCIC] in the United States district court for the district in which the insured farm is located...." Pub. L. No. 96-365, § 106(2), 94 Stat. 1314, 1315, 1317 (codified at 7 U.S.C. § 1508(c) with current amended version at 7 U.S.C. § 1508(j) (2) (A)). This provision was again amended in 1994. Pub. L. No. 103-354, § 106, 108 Stat. 3183 (1994). The current version reads: "Subject to [a statute of limitations], if a claim for indemnity is denied by the [FCIC] or an approved provider, an action on the claim may be brought against the [FCIC] or the Secretary only in the United States district court for the district in which the insured farm is located." 7 U.S.C. § 1508(j) (2) (A).
3M Health Care, Ltd. v. Grant, 908 F.2d 918, 920 (11th Cir. 1990) (quoting Taylor v. General Motors Corp., 875 F.2d 816, 822 (11th Cir. 1989)).
Congress did not draft the FCIA to expressly preempt state law claims, nor does the wording of the statute or its legislative history evince an intent to preempt state law claims. As the Supreme Court reminds us, "the starting point for interpreting a statute is the language of the statute itself. Absent a clearly expressed legislative intention to the contrary, that language must ordinarily be regarded as conclusive." Consumer Product Safety Com'n v. GTE Sylvania, Inc., 447 U.S. 102, 108, 100 S. Ct. 2051, 2056, 64 L. Ed. 2d 766 (1980).
Section 1508(j) (2) (A) states that in the face of a denial of a claim by the FCIC or an approved crop insurance provider, an insured "may" bring suit against the FCIC or the Secretary. This language is permissive, and does not make a suit against the FCIC or the Secretary the exclusive remedy. The legislative development of this section supports our conclusion.
Section 1508(j) was created by the passage of H.R. 4217 on October 13, 1994. Pub. L. No. 103-354, 108 Stat. 3183 (1994). A previous version of H.R. 4217 adopted by the Senate read:
H.R. 4217, 103d Cong. § 1108(I) (2) (A) (1994) (emphasis added). And, as previously set out, the final version passed by both the House and the Senate reads:
7 U.S.C. § 1508(j) (2) (A) (emphasis added).
In this final version, Congress opted for the phrase "may be brought" instead of "shall only be brought." Canons of statutory construction teach that "if the bill was originally introduced containing a permissive verb and finally passed containing an imperative verb, or vice versa, the verb in the final bill prevails and carries its ordinary meaning." Norman J. Singer, Sutherland's Statutory Construction, § 57.05 at 18 (5th ed.1992). Thus, we read § 1508(j) (2) (A) as permitting a suit against the FCIC or the Secretary of Agriculture--not as mandating such a suit.
Moreover, when the Senate proposed to use the restrictive phrase "shall only be brought," it included the insurance provider as a potential defendant. Thus, at no point in the evolution of § 1508(j) (2) (A) did Congress consider preventing farmers from suing their private insurance company when that insurance company denies their claim.2
The FCIA does not contain a similar provision concerning suits against participating private insurance companies. We thus infer that Congress intended to leave insureds with their traditional contract remedies against their insurance companies. Such remedies include a state law breach of contract claim. This inference is strengthened by other provisions of the FCIA and FCIC regulations that presume an action against private insurance companies. See 7 U.S.C. § 1508(j) (3) (mandating that the FCIC provide approved insurance providers with indemnification); 7 C.F.R. § 400.176(b) (1997) (preemption provision limiting specified claims for damages against reinsured companies "other than damages to [sic] which the [FCIC] would be liable under federal law if the [FCIC] had issued the policy of insurance under its direct writing program...."). The existence of a claim against a private reinsured company is therefore consistent with the scheme of the FCIA.
This statement holds true after examining H.R. 4217 as first introduced in the House, see H.R. 4217, 103d Cong. § 2(I) (April 14, 1994), as reported to the full House by the Agriculture Committee, see H.R. 4217, 103d Cong. § 7(j) (August 1, 1994), and as first passed by the House before going to the Senate, see H.R. 4217, 103d Cong. § 7(j) (2) (A) (1994)