Court Opinion

ID: 3003201
Source: CourtListenerOpinion
Date Created: 2015-09-24 20:40:21.470394+00
Date Added: 2024-06-11T12:23:17.250450
License: Public Domain

In the

    United States Court of Appeals
                 For the Seventh Circuit

No. 08-4300

W ISCONSIN V ALLEY IMPROVEMENT C OMPANY,

                                                 Plaintiff-Appellant,
                                  v.

U NITED S TATES OF A MERICA,
                                                Defendant-Appellee.

             Appeal from the United States District Court
                  for the Western District of Wisconsin.
            No. 08-cv-378-slc—Barbara B. Crabb, Chief Judge.

          A RGUED M AY 12, 2009—D ECIDED JUNE 22, 2009

  Before E ASTERBROOK, Chief Judge, SYKES, Circuit Judge,
and V AN B OKKELEN, District Judge.^
   E ASTERBROOK, Chief Judge. Wisconsin Valley Improve-
ment Company operates dams and other improvements
in or near the Wisconsin River. Some of the dams need
licenses from the Federal Energy Regulatory Commission.

^
    Of the Northern District of Indiana, sitting by designation.
2                                               No. 08-4300

When the Company proposed to renew one hydro-
power license, the United States Forest Service asked the
Commission to condition renewal on steps that would
curtail flooding of federally owned lands and compensate
the United States for the loss of use. The Company replied
that it enjoys flowage easements over these lands—
easements that, the Company maintains, arose by the
passage of time (“prescription”) rather than written
conveyances. According to the Company, these ease-
ments made the proposed conditions unnecessary and
inappropriate.
  A brief filed with the Commission in February 1996
rejoined that the Commission is entitled to impose the
conditions whether or not the Company has a flowage
easement and added that the Forest Service does not
concede the Company’s claim of a flowage easement. The
Commission imposed the requested conditions. A peti-
tion for review was denied, for the most part, by
Wisconsin Valley Improvement Co. v. FERC, 236 F.3d
738 (D.C. Cir. 2001), which agreed with the Commission
that the United States’ title to the lands allows the Com-
mission to curtail flooding and require compensation
whether or not the Company has a flowage easement.
Id. at 742–43.
  Seventeen years after the Forest Service asked the
Commission to impose conditions designed to reduce
flooding, and more than 12 years after the Forest Service
declined to concede that the lands are subject to a
flowage easement, the Company filed this suit under
the Quiet Title Act, 28 U.S.C. §2409a. The statute of limita-
No. 08-4300                                              3

tions for quiet-title suits against the United States is
12 years. 28 U.S.C. §2409a(g). The district court concluded
that the Company’s claim had accrued no later than
February 1996, when the Forest Service questioned the
existence of the asserted flowage easement. Because the
suit was not filed until June 2008 it is untimely. 2008
U.S. Dist. L EXIS 98092 (W.D. Wis. Dec. 2, 2008). The
district court dismissed the suit under Fed. R. Civ. P.
12(b)(1), ruling that an untimely action against the
United States does not come within the court’s subject-
matter jurisdiction.
  On appeal, the United States defends that jurisdictional
characterization. The argument starts from the premise
that sovereign immunity limits the jurisdiction of
the Judicial Branch. Suits against the United States are
permissible only when authorized by statute; the period
of limitations is a condition on the waiver of sovereign
immunity; thus an untimely suit is outside the court’s
subject-matter jurisdiction. The problem with this argu-
ment lies in the premise: Sovereign immunity is not a
jurisdictional doctrine. See United States v. Cook County,
167 F.3d 381 (7th Cir. 1999). Subject-matter jurisdiction
means adjudicatory competence over a category of dis-
putes. See Kontrick v. Ryan, 540 U.S. 443 (2004); Eberhart
v. United States, 546 U.S. 12 (2005). Multiple statutes
authorize federal district courts to adjudicate suits
arising under federal law in which the United States is a
party. See, e.g., 28 U.S.C. §1331, §1346; 5 U.S.C. §702.
Section 2409a, in particular, permits the adjudication of
quiet-title actions in which the United States claims an
interest in real property. No more is needed for subject-
4                                               No. 08-4300

matter jurisdiction. Timely suit is a condition of relief, to
be sure, but time limits in litigation do not detract from
a court’s adjudicatory competence.
  Irwin v. Department of Veterans Affairs, 498 U.S. 89
(1990), resolved this point. It held that time limits in
employment-discrimination suits against the United
States or one of its agencies are subject to tolling and
estoppel. That view is incompatible with a “jurisdictional”
characterization of a statute of limitations. And
Scarborough v. Principi, 541 U.S. 401 (2004), extended Irwin
to other time limits in suits where the United States or
an agency is a defendant. After Irwin, Scarborough, and
Cook County it is hard to understand how a “jurisdictional”
tag may be attached to any period of limitations, whether
or not the United States is a party. See, e.g., Arbaugh
v. Y&H Corp., 546 U.S. 500 (2006).
  The brief filed by the United States in this appeal does
not mention any of the recent cases. Instead it relies on
older decisions that used the word “jurisdiction” to
describe any mandatory rule. For example, Munro v.
United States, 303 U.S. 36 (1938), said that an attorney for
the United States may not, by oversight, surrender the
benefit of a time limit in tax-refund litigation. Munro, and
many similar cases, instantiate the principle that negli-
gence of a federal employee does not estop the United
States to enforce the terms of statutes specifying when
funds may be drawn from the Treasury. See, e.g., Office
of Personnel Management v. Richmond, 496 U.S. 414 (1990).
This principle differs from a limit on subject-matter
jurisdiction, which a court must enforce even if the
No. 08-4300                                                 5

parties stipulate to the court’s authority. Block v. North
Dakota, 461 U.S. 273, 292 (1983), the most recent decision
that has used the word “jurisdiction” when referring to
the effect of a statute of limitations for suit against the
national government, appears to be yet another example
of the tendency, discussed in Kontrick and Eberhart, to
employ the word loosely; not every reference to “jurisdic-
tion” in the Supreme Court’s large corpus of decisions
means “subject-matter jurisdiction” in the contemporary
sense.
  After Irwin and Scarborough, time limits affecting suits
against the United States are not among the few true
jurisdictional rules that the judiciary must raise, and
resolve, on its own even if the litigants agree that the
suit is timely. Nor should a district court dismiss an
untimely suit for want of jurisdiction, implying that
plaintiff may present the claim to some other tribunal. The
right disposition of a time-barred suit against the United
States is dismissal with prejudice. The Department of
Justice needs to abandon its rear-guard attempt to treat
all conditions on waivers of sovereign immunity as
“jurisdictional.” It should recognize the modern under-
standing of the difference between “jurisdiction” and
other norms. See Collins v. United States, 564 F.3d 833 (7th
Cir. 2009). As we observed in Collins, some courts of
appeals have been slow to understand the effect of Irwin
and Scarborough and have continued to use the language
of subject-matter jurisdiction. But in this circuit, at least,
conditions on litigation against the United States may
be “mandatory” without being “jurisdictional.”
6                                               No. 08-4300

  The Quiet Title Act requires action within 12 years
after a claim accrues, and it adds: “Such action shall be
deemed to have accrued on the date the plaintiff or his
predecessor in interest knew or should have known of
the claim of the United States.” This language could be
read to say that the claim accrues as soon as a person
knows that the United States claims title or any other
interest in the real property. The Company knew of the
national government’s fee title much more than 12 years
before filing suit. This would mean that any claim based
on an easement accrues as soon as the United States
acquires title to land that is subject to an (asserted) ease-
ment.
  But the statute has not been understood in this way.
Instead courts say that the claim accrues when a person
knows, or in the exercise of reasonable diligence should
have known, that the United States maintains a claim
adverse to the plaintiff’s. See Richmond, Fredericksburg &
Potomac R.R. v. United States, 945 F.2d 765, 770 (4th Cir.
1991); Bank One Texas v. United States, 157 F.3d 397, 402
n.11 (5th Cir. 1998); Spirit Lake Tribe v. North Dakota,
262 F.3d 732, 738 (8th Cir. 2001); Kingman Reef Atoll Invest-
ments, L.L.C. v. United States, 541 F.3d 1189, 1198 (9th Cir.
2008); Knapp v. United States, 636 F.2d 279, 283 (10th Cir.
1980). The United States is content with this understand-
ing, so we need not decide whether it is correct. (The
ability to avoid unnecessary adjudication is one benefit of
holding that a statute of limitations does not concern
subject-matter jurisdiction. If the rule really were juris-
dictional, we could not accept the United States’ concession
on this or any other issue.)
No. 08-4300                                                 7

  Nor need we resolve whether an easement arising by
prescription is covered by 28 U.S.C. §2409a(n), which
forbids any claim against the United States based on
adverse possession. The idea behind §2409a(n) is that the
United States owns vast tracts of wilderness and may
not discover squatters—let alone people who graze
cattle or inundate federal land intermittently—within
the usual time for interests to vest by adverse possession.
Ranchers, road or trail builders, and dam owners know
what they are doing and may alert the United States
and get easements in writing rather than hope that a
right will arise by prescription. For its part, the Company
says that §2409a(n) deals only with claims of title, as
opposed to claims of easements; we need not decide,
for this suit is untimely.
  We may assume, as the Company asserts, that no one
at the Forest Service has ever flatly asserted that the
Company is forbidden to flood federal lands (as the
Company says it has been doing since its first dam was
built in 1907). But the time starts under §2409a(g) with
notice of a problem as well as with actual knowledge of
an adverse claim. The Forest Service maintains, and the
district court held, that filings in the course of pro-
ceedings before the Commission put the Company on
what is called “inquiry notice”: that is, the Forest Service
said enough to lead a reasonable person to conclude
that the claim of easement was open to question, and thus
to prompt inquiry. That sort of knowledge is enough to
start the period of limitations. See United States v. Kubrick,
444 U.S. 111 (1979); Holmberg v. Armbrecht, 327 U.S. 392
(1946); Kirby v. Lake Shore & Michigan Southern R.R., 120
8                                                No. 08-4300

U.S. 130 (1887); cf. United States v. Mottaz, 476 U.S. 834
(1986).
   None of the Forest Service’s submissions in the re-
licensing proceeding conceded that the Company has
any right, by prescription or otherwise, to inundate
federal lands. Several of the submissions asserted that
the Company may establish an easement only by an
action under §2409a. For example: “Further, absent bring-
ing an action pursuant to 28 U.S.C. 2409a, [the Company]
cannot maintain . . . that the United States’ title is bur-
dened by flowage easements gained by prescription. . . .
Moreover, the above discussion assumes, for the sake of
argument only, that all of the National Forest System
lands within the project are burdened with flowage
rights.” These and similar passages should have led
lawyers representing the Company to understand that
its claim of flowage easements had not been acknowl-
edged and was a subject of potential dispute. That’s
enough to prompt inquiry. The Company had 12 years
to negotiate for written easements or to file suit—as the
Forest Service invited it to do. For 12 years and 4 months
it did neither. That delay lies on the Company’s own
doorstep.
  The Company contends that the clock does not start
until the United States uses land in a way incompatible
with the private claim—for example, building a dike
that blocks the flow of water or a fence that turns away
the flock of sheep. This argument is incompatible with
the rule, stated in §2409a(g) and (k), as well as in the cases
we have cited, that it is the private party’s knowledge
No. 08-4300                                             9

(actual or constructive), rather than the United States’
bulldozers or other physical activity, that causes a claim
to accrue. Someone who wants a legal right to use land
owned by the United States must act to vindicate the
claim; the United States need not evict the interloper by
force.
  The judgment of the district court is modified to be a
dismissal with prejudice, rather than for lack of subject-
matter jurisdiction, and as so modified is affirmed.

                          6-22-09