Opinion ID: 77694
Heading Depth: 2
Heading Rank: 2

Heading: john and shelby mahon's administrative appeal.

Text: 21 On June 13, 2002, John and Shelby Mahon timely signed and filed notices of administrative appeal with the NAD. A Hearing Officer conducted a hearing on November 16, 2002. During the hearing, the Officer received evidence that other nurseries in Lake County and elsewhere in Florida had received benefits even though they had not paid the commercial growers registration fees as required by Florida law and that the FSA had not asked those nurseries whether they were registered under Florida law. Although the FSA acknowledged that it erroneously had issued some payments to ineligible applicants, the FSA argued that the applicable federal regulation, 7 C.F.R. § 718.9 (2002), prohibited the FSA from seeking a refund. The FSA also presented sworn testimony that the FSA had not been aware of the status of the unregistered recipients when it had approved their applications and that once the problem was identified, [the] FSA began inquiring into licensure status of all applicants before paying benefits. 22 On December 4, 2002, the Hearing Officer issued an Appeal Determination in which he found that the Lake County Committee had erred in denying John Mahon's and Shelby Mahon's applications for disaster relief. The Hearing Officer concluded that the Agency's decision to deny disaster relief to John and Shelby Mahon because their state certificate of registration to sell nursery stock had expired, while granting relief to others whose certificates had likewise expired, was arbitrary and contrary to law. According to the Hearing Officer, the Agency must provide assistance to all producers equally. In addition, the Hearing Officer found that the [A]gency's use of Florida Statutes as one of the basis [sic] for denying [John and Shelby Mahon's Crop Disaster Program] benefits is not in accordance with the standards established by federal published regulations. In the alternative, the Hearing Officer noted that even if Florida's certification law was applicable, a USDA Official had already concluded in another case that under Florida law a certification was not required until such time as the crop was ready to be sold. 4 Since the Agency failed to provide any evidence that the Mahon's crops were eligible for sale, they were not required to be registered as commercial producers pursuant to Florida law. Lastly, the Hearing Officer concluded that the Agency's determination that John and Shelby Mahon's management of the nursery did not meet the definition of best management practices was erroneous. On December 27, 2002, the FSA Acting Administrator filed a request for review of the Hearing Officer's December 4, 2002 Appeal Determination by the Director of the NAD. 23 On January 22, 2003, the Director issued a Director Review Determination, in which he reversed the Hearing Officer's ruling. The Director found that John and Shelby Mahon's request for disaster relief was appropriately denied because they had not employed best management practices as required by federal regulations. The Director declined to address the issue of whether [John and Shelby Mahon's] missing state [certificate of registration] also supported [the] FSA's adverse decision. 24 On February 7, 2003, John and Shelby Mahon requested reconsideration of the Director's Review Determination. Thereafter, on August 15, 2003, the Deputy Director, who had been delegated authority to make determinations on requests for reconsideration, issued a Revised Director's Review Determination. The Deputy Director vacated the January 22, 2003, Director Review Determination based on a finding that it had been based on a material fact that was in error. Specifically, the Deputy Director found the Director's conclusion that the Mahons had failed to employ best management practices was erroneous. The Deputy Director then conducted a de novo review of the matter, but nevertheless determined that the Lake County Committee's denial of benefits was supported by the law and the evidence and that the Hearing Officer's December 4, 2002, Appeal Determination, must be reversed. 25 The Deputy Director found that the Agency properly denied disaster relief to John and Shelby Mahon because they were not operating as a commercial nursery at the time of their loss. The Deputy Director reasoned that [d]isaster benefits are expressly limited by regulations to ornamental nursery crops that were grown in a container or controlled environment for commercial sale on property owned or leased by the producer, and since John and Shelby Mahon's nursery was not registered as a commercial nursery under Florida law, and since their crops could not be legally sold under Florida law without being registered on the dates of their loss, disaster benefits were properly denied. 26 On September 9, 2003, John and Shelby Mahon filed their Request for Reconsideration of the Director's Revised Review. Their request was denied on October 17, 2003.