Court Opinion

ID: 9011981
Source: CourtListenerOpinion
Date Created: 2022-11-27 14:07:12.732315+00
Date Added: 2024-06-11T17:11:25.227852
License: Public Domain

HUG, Circuit Judge,
dissenting:
I respectfully dissent. I would reverse the district court’s decision to grant summary judgment in favor of appellees because the district court erred in determining that Brandt-Erichsen failed to obtain a “receipt upon final entry” for purposes of 43 U.S.C. § 1165 (1988).
I. The Statutes
As we observed in Grewell v. Watt, 664 F.2d 1380 (9th Cir.1982), both the statute under which Brandt-Erichsen claims his site, 43 U.S.C. § 687a (1982) (repealed effective 1986),1 and the statute which he argues barred the BLM’s contest after two years, 43 U.S.C. § 1165, had their genesis in an 1891 congressional act entitled “An Act to repeal timber-culture laws, and for other purposes,” Ch. 561, 26 Stat. 1095 (1891) (“the 1891 Act”). See id. at 1382. Section 1 of the 1891 Act contained provisions dealing with claims based on the occupation of Alaska lands “for the purpose of trade or manufactures.” Id.
A. 43 U.S.C. § 687a
Section 12 of the 1891 Act contained the original version of what became 43 U.S.C. § 687a. This section described who was entitled to claim land under the Act:
[A]ny citizen of the United States ... in possession of and occupying public lands in Alaska for the purpose of trade or manufactures, may purchase not exceeding one hundred and sixty acres to be taken as near as practicable in a square form, of such land at two dollars and fifty cents per acre....
Ch. 561, 26 Stat. 1100 (1891). Section 13 set out the process by which persons entitled to claim such land could do so:
[IJt shall be the duty of any person ... entitled to purchase land under this act to make an application to the United States marshal, ex officio surveyor-general of Alaska, for an estimate of the cost of making a survey of the lands occupied by such person ... and the cost of the clerical work necessary to be done in the office of the said United States marshal, ex officio surveyor-general; and on the receipt of such estimate from the United States marshal, ex officio surveyor-general, the said person ... shall deposit the amount in a United States depository, as is required by section numbered twenty-four hundred and one, Revised Statutes, relating to deposits for surveys.
That on the receipt by the United States marshal, ex officio surveyor-general, of the said certificates of deposit, he shall employ a competent person to make such survey, under such rules and regulations as may be adopted by the Secretary of the Interi- *1384or, who shall make his return of his field notes and maps to the office of the said United States marshal, ex-officio surveyor-general; and the said United States marshal, ex officio surveyor-general, shall cause the said field notes and plats of such survey to be examined, and, if correct, approve the same, and shall transmit certified copies of such maps and plats to the office of the Commissioner of the General Land Office.
That when the said field notes and plats of said survey shall have been approved by the said Commissioner of the General Land Office, he shall notify such person ... who shall then, within six months after such notice, pay to the said United States marshal, ex officio surveyor-general, for such land, and patent shall issue for the same.
Ch. 561, 26 Stat. 1100 (1891) (emphasis added).
Contrary to Judge Poole’s determination, I conclude that the statutory language makes Congress’ intent clear. When it enacted the 1891 Act, Congress intended that an eligible claimant would pay the purchase price of such land only after a survey had been conducted and approved by the Commissioner of the General Land Office.2 Furthermore, Congress granted such a claimant an additional six months after notification of the Commissioner’s approval of a survey in which to tender the purchase price of the land.
In 1898, Congress enacted another statute entitled “An Act Extending the homestead laws and providing for right of way of railroads in the District of Alaska, and for other purposes,” Ch. 299, 30 Stat. 409 (1898) (“the 1898 Act”). Section 10 provides, in pertinent part:
[A]ny citizen of the United States ... in the possession of and occupying public lands in the District of Alaska in good faith for the purposes of trade, manufacture, or other productive industry, may each purchase one claim only not exceeding eighty acres of such land for any one person ... at two dollars and fifty cents per acre, upon submission of proof that said area embraces improvements of the claimant and is needed in the prosecution of such trade, manufacture, or other productive industry. ...
Ch. 299, 30 Stat. 413 (1898). “Th[is] language is so similar to the language of the 1891 Act that we can only conclude that the genesis of the 1898 language was the 1891 Act itself.” Grewell, 664 F.2d at 1383. Moreover, the 1898 Act “specifically recognize[s] the validity of claims theretofore made under the 1891 Act, it does not purport to repeal the 1891 Act.” Id.3
The 1898 Act contained no reference to payment of the purchase price as a step in the process through which persons entitled to claim such land could acquire it. “From this we infer that the language, already in effect, was deemed sufficient to meet 1898 needs.” Id. We also infer that Congress intended to retain the land claims process articulated in section 13 of the 1891 Act. Had Congress intended to modify this process to require eligible claimants to tender the purchase price prior to completion and approval of a survey, “surely Congress would have manifested that intent more clearly.” Id. at 1383-84.
The language of the 1898 Act, with minor irrelevant changes, appears now as 43 U.S.C. § 687a. Moreover, the process by which persons entitled to claim such land may acquire it remains basically unchanged. See 43 C.F.R. §§ 2562.1-2562.7 (1992). Most notably, current BLM regulations require an eligible claimant to pay the purchase price of the land only after a survey has been con*1385ducted and proofs approved. 43 C.F.R. § 2562.7.
In this case, Brandt-Eriehsen filed a Notice of Location of Settlement or Occupancy Claim and submitted the required fee in accordance with 43 C.F.R. § 2562.1. He also filed an Application to Purchase Trade and Manufacturing Site and Petition for Survey along with the required fee in accordance with 43 C.F.R. §§ 2562.3, 2562.4. Brandt-Eriehsen received receipts for the payments. The next step in the process was the completion of a survey by the Government. See 43 C.F.R. § 2563.4. BrandL-Erichsen was not required to tender the purchase price of the land until after the survey had been conducted and approved. See 43 C.F.R. § 2562.7.
B. 43 U.S.C. § 1165
The Supreme Court’s decision in Stockley v. United States, 260 U.S. 532, 43 S.Ct. 186, 67 L.Ed. 390 (1923), confirms my interpretation of this land claims process. In Stockley, the Supreme Court focused its attention on section 7 of the 1891 Act, which is codified at 43 U.S.C. § 1165. Section 7 is now known as the “Confirmation Statute,” and it is the statute upon which Brandt-Eriehsen relies to argue that the BLM’s contest was barred.
Section 7 of the 1891 Act provided:
That after the lapse of two years from the date of the issuance of the receiver’s receipt upon the final entry of any tract of land under the homestead, timber-culture, desert-land, or pre-emption laws, or under this act, and when there shall be no pending contest or protest against the validity of such entry, the entryman shall be entitled to a patent conveying the land by him entered, and the same shall be issued to him....
Ch. 561, 26 Stat. 1099 (1891) (emphasis added).
In Stockley, the Supreme Court concluded that the entryman was entitled to a receiver’s receipt once he had complied with the provisions of the homestead laws, submitted final proof, and paid the commissions and fees then due. 260 U.S. at 540, 43 S.Ct. at 188. The receiver’s receipt that the entryman had been issued showed that he had paid $3.01 for 71.25 acres of land, and not the purchase price of $89.06.4 See id. at 536-37, 43 S.Ct. at 186-87. The entryman in Stockley did not pay the purchase price.
The Supreme Court proceeded to conclude that once the receiver’s receipt issued, section 7 of the 1891 Act was implicated, and the two-year time period within which the Government could contest the claim began to run. Id. at 539-40, 43 S.Ct. at 187-88. The Court expressly rejected the Government’s contention that Stockley’s receipt “obtain[ed] no validity as a ‘receiver’s receipt upon the final entry’ until after the proof ha[d] in fact been examined and approved.” Id. at 539, 43 S.Ct. at 188. Because the Commissioner of the General Land Office waited more than three years after the issuance of the receiver’s receipt to contest the entryman’s claim, the Supreme Court held that full equitable title had vested in the entryman, and he had become entitled to a patent by virtue of section 7 of the 1891 Act. Id. at 544, 43 S.Ct. at 189.
Like the entryman in Stockley, Brandts Erichsen filed the appropriate documents and paid the fees lawfully due, but he did not tender the purchase price. Moreover, Brandt-Eriehsen received receipts for the fees submitted. The only steps left in the *1386process were the Government’s completion and approval of a survey of the land and, thereafter, Brandt-Erichsen’s payment of the purchase price. See 43 C.F.R. §§ 2562.4, 2562.7 (1992). The Government waited more than five years after Brandt-Erichsen received a receipt for payment of the fee accompanying his Application to Purchase Trade and Manufacturing Site to contest his claim. Thus, BrandWErichsen is entitled to a patent conveying the land by virtue of 43 U.S.C. § 1165. See Stockley, 260 U.S. at 544, 43 S.Ct. at 189; Grewell, 664 F.2d at 1382.
Appellees argue that we should defer to the agency’s interpretation of the Confirmation Statute. Appellees look to United States v. Jones, 106 I.B.L.A. 230 (1988); United States v. Braniff, 65 I.B.L.A. 94 (1982); United States v. Bunch, 64 I.B.L.A. 318 (1982); United States v. Boyd, 39 I.B.L.A. 321 (1979), for the proposition that the two-year period referred to in 43 U.S.C. § 1165 does not begin to run until a claimant has tendered or paid the purchase price.
Although these decisions embrace appel-lees’ interpretation of 43 U.S.C. § 1165, the Interior Board of Land Appeals misconstrued the plain language of the statute to reach them. In Bunch, which contains the Board’s most exhaustive discussion of this issue, the Board incorrectly emphasized the finality of payment rather than the finality of entry. See 64 I.B.L.A. at 324. In fact, the Board repeatedly referred to the “final receipt of the receiver” rather than the “receiver’s receipt upon the final entry” (26 Stat. 1099) or “the receipt of such officer as the Secretary of the Interior may designate upon the final entry” (43 U.S.C. § 1165). See id. The Board concluded that because Bunch had not paid or tendered the purchase price, “nothing which could be considered a ‘final receipt’ ha[d] issued to her or [was] due her.” Id.
In contrast, the Stockley Court carefully analyzed the term “final entry” in an effort to determine whether the receipt issued to the entryman fell within the meaning of the statute. See 260 U.S. at 539-40, 43 S.Ct. at 187-88. Despite the fact that the entryman had not tendered the purchase price, the Supreme Court concluded that he “did, in fact, make final entry and the receiver did, in fact, issue and deliver his receipt thereon.” Id. at 542, 43 S.Ct. at 189. Thus, the Board’s decisions are in direct conflict with the Supreme Court’s decision in Stockley.
In Bunch, the Board noted that “because the amount of land in the claim cannot be ascertained without a survey, it would not have been possible for [Bunch] to pay the correct amount, or for the officer designated to issue a receipt evincing final payment, until the number of acres in the claim was known.” 641 I.B.L.A. at 325. Contrary to the Board’s contention, this observation lends support to my interpretation of 43 U.S.C. § 1165. Once a claimant has filed the appropriate documents and submitted the fees then due in an effort to acquire unsurveyed land, he must wait for the Government to conduct and approve a survey before he may tender the purchase price, and he must tender the purchase price before he can get what the Board characterizes as the “final receipt.” To require the claimant to obtain such a “final receipt” before the two-year period described in 43 U.S.C. § 1165 begins to run would frustrate the purpose of the statute — to avoid delays for an unreasonable length of time, that is, more than two years. See Stockley, 260 U.S. at 540-41, 43 S.Ct. at 188.
That is precisely the situation with which we are presently faced. Brandt-Erichsen filed an Application to Purchase Trade and Manufacturing Site and paid the required application fee on August 6,1973. The BLM waited until January 18, 1979, more than five years later, to file an administrative complaint contesting Brandb-Eriehsen’s request for a patent on the property. Under appel-lees’ interpretation of 43 U.S.C. § 1165, the BLM’s conduct in this case must be approved. Such an outcome is contrary to the expressed intent of Congress.
Although the agency’s interpretation of the statute is entitled to deference, see Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 844-45, 104 S.Ct. 2778, 2782-83, 81 L.Ed.2d 694 (1984), it need *1387not be followed if it appears from the statute or its legislative history that the interpretation is not one that Congress would have sanctioned. “When Congress has plainly described the instrument from whose date the statute begins to run as the ‘receipt upon the final entry,’ there is no warrant for construing it to mean only a receipt issued simultaneously with the certificate or one issued after the adjudication on the final proof, which might be — and in this instance was— postponed indefinitely.” Stockley, 260 U.S. at 540, 43 S.Ct. at 188. Thus, appellees’ reading of the statute is not one that Congress would have sanctioned.
I conclude that the district court incorrectly applied the relevant substantive law. Thus, I would reverse the district court’s decision to grant summary judgment in favor of appellees. See FDIC v. O’Melveny & Myers, 969 F.2d 744, 747 (9th Cir.1992); Tzung v. State Farm Fire & Casualty Co., 873 F.2d 1338, 1339-40 (9th Cir.1989).
II. Waiver
Appellees also argue that Brandt-Erichsen waived his argument based upon the Confirmation Statute by failing to raise it during the administrative proceedings before the agency. Generally, we will not consider issues not presented before an administrative proceeding at the appropriate time. Marathon Oil Co. v. United States, 807 F.2d 759, 767 (9th Cir.1986), cert. denied, 480 U.S. 940, 107 S.Ct. 1593, 94 L.Ed.2d 782 (1987). However, we may “decide issues over which an agency has power and jurisdiction when ‘exceptional circumstances’ warrant such review, notwithstanding the petitioner’s failure to present them to the agency.” Id. at 768 (quoting Reid v. Engen, 765 F.2d 1457, 1461 (9th Cir.1985)).
In the absence of a statute expressly requiring that the Confirmation Statute argument must be raised before the agency, we must balance “the agency’s interests ‘in applying its expertise, correcting its own errors, making a proper record, enjoying appropriate independence of decision and maintaining an administrative process free from deliberate flouting, and the interests of private parties in finding adequate redress for their grievances.’” Id. (quoting Litton Indus., Inc. v. FTC, 676 F.2d 364, 369-70 (9th Cir.1982)). I conclude that Brandt-Erichsen was not required to raise this argument before the agency as it would have been futile for him to do so.
Contrary to appellees’ contention, Brandt-Erichsen’s failure to raise this argument during the administrative proceedings did not preclude the agency from interpreting 43 U.S.C. § 1165 and related regulations. In the words of appellees, “the Department of Interior (DOI) has consistently held that, with respect to the purchase of public lands in Alaska, the two-year limitation does not begin to run until the claimant has tendered the purchase price in accordance with the Alaska Act, 43 U.S.C. § 687a.” Appellee’s Brief at 9. The decisions of the Interior Board of Land Appeals are consistent with DOI’s interpretation. See Jones, 106 I.B.L.A. at 264-66; Braniff, 65 I.B.L.A. at 97-98; Bunch, 64 I.B.L.A. at 324-25; Boyd, 39 I.B.L.A. at 328-29. As a practical matter, the agency’s established position renders administrative review of this issue meaningless. See Aleknagik Natives Ltd. v. Andrus, 648 F.2d 496, 500-01 (9th Cir.1980).
Because it would have been futile for Brandt-Erichsen to raise the Confirmation Statute argument before the agency, I conclude that exceptional circumstances justify our consideration of this issue.

. The statute 43 U.S.C. § 687a was repealed effective October 21, 1986 by the Federal Land Policy and Management Act of 1976, Pub.L. No. 94-579, § 703(a), 90 Stat. 2743, 2789-91 (1976). It was in effect, however, during all of the events relevant to this case.

. In 1946, Congress abolished the General Land Office and the offices of Commissioner of the General Land Office and transferred their functions to the newly created BLM. Reorganization Plan No. 3 of 1946, § 403, 60 Stat. 1097, 1100 (1946).

. Section 10 of the 1898 Act further provides:
"That all claims substantially square in form and lawfully initiated, prior to January twenty-first eighteen hundred and ninety-one [the 1891 Act], may be perfected and patented upon compliance with the provisions of said Act, but subject to the requirements and provisions of this Act....”
Ch. 299, 30 Stat. 413 (1898).

. A complete version of the receipt appears in the Court of Appeals’ decision in the case:
"[I]n connection with Hd. Final, Serial No. 1088, for [describing land] 71.25 acres at 1.25 per acre,
Fees
Commissions.......................................................................... $1.76
Testimony fees, etc..................................................................... 1.25
$3.01
Less corn's suspended in official mys.(moneys) ......................................... 1.76
$1.25
"C.J. Greene, Receiver of Public Moneys." Cir.1921).
Stockley v. United States, 271 F. 632, 634 (5th