Court Opinion

ID: 2680670
Source: CourtListenerOpinion
Date Created: 2014-06-26 20:01:01.745067+00
Date Added: 2024-06-11T13:14:59.423550
License: Public Domain

In the United States Court of Federal Claims

No. l4-27C
(Filed: June 26, 2014)

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HEIDI PETERSON,

Plaintzff
v.

THE UNITED STATES,

Deferza'arzt.

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ORDER

Plaintiff, appearing pro se, filed a complaint and a motion for leave to
proceed in forma pauperis on January 13, 2014.1 Ms. Peterson claims to be a
third-party beneficiary of a contract between the Department of Housing and
Urban Development ("HUD") and the city of Detroit, pursuant to which HUD
furnished funds to Detroit to be used to help persons such as Ms. Peterson.
She alleges that the United States breached the contract by failing to ensure
that she received grant money for the removal of lead paint in her home. She
alleges that she was approved by the city for a grant but HUD did not release
the funds to the city due to the city’s record of prior mismanagement of grant
funds. She seeks unspecified monetary damages and an order directing HUD
to develop alternative methods for ensuring the proper distribution of grant
funds. Defendant has moved to dismiss for lack of jurisdiction pursuant to
Rule lZ(b)(l) of the Rules of the Court of Federal Claims ("RCFC"). The
motion is fully briefed, and oral argument is deemed unnecessary. F0r the
reasons set out below, this court does not have jurisdiction to provide plaintiff
the relief she seeks. As a result, we grant the motion to dismiss.

Plaintiff contends that she is a third-party beneficiary of an alleged
contract between the United States, acting through HUD, and the city of

1 For good cause shown, we grant the motion to proceed in forma pauperis

Detroit.z She asserts that the contract calls for the distribution of funds by the
city of Detroit to help homeowners remove lead-based paint from affected
households. She argues that, as a homeowner, she falls within the class
intended to be benefitted by the HUD grant funds, and, therefore, this court has
jurisdiction to hear her claim.

Under the Tucker Act, 28 U.S.C. §l49l(a)(l) (2012), this court has
jurisdiction to hear claims for money against the federal government grounded
upon a constitutional, statutory, regulatory, or contractual right to that money.
See United States v. Mz`tchell, 463 U.S. 206, 218 (1983). For jurisdictional
purposes, plaintiff relies solely on the existence of a contract of which she is
the third-party beneficiary.

Defendant challenges jurisdiction, asserting that plaintiff is neither in
privity with the United States nor is she a direct third-party beneficiary to a
contract with the United States. lt argues that the alleged contract was for the
delivery of public services and consequently plaintiff cannot be a third-party
beneficiary. Defendant also argues that plaintiff requests equitable relief, a
remedy for which this court does not have jurisdiction to award.

Jurisdiction is a threshold matter. See Steel C0. v. Citizerzs for a Better
Env ’t, 523 U.S. 83, 94-95 (1998). Although plaintiffis appearingpr0 se, and
pro se litigants are afforded latitude, that cannot excuse jurisdictional failings.
See Kelly v. U.S. Sec’y ofDep’t ofLabor, 812 F.Zd 1378, 1380 (Fed. Cir.
1987) ("a court may not similarly take a liberal view of that jurisdictional
requirement and set a different rule for pro se litigants only"). "Plaintiffs have
the burden of establishing the court’s subject matter jurisdiction over their
respective claims." Rodriguez v. U.S., 69 Fed. Cl. 487, 490 (Fed. Cl. 2006).
Dismissal should only be granted, however, if plaintiff cannot demonstrate that
she is entitled to relief. Schuermarz v. United States, 30 Fed. Cl. 420, 425 (Fed.
Cl. 1994).

When evaluating a motion to dismiss for lack of subject matter
jurisdiction, the court must accept the facts in the complaint as true and must
construe allegations of the complaint in favor of the plaintiff. Roa'rz`guez, 69
Fed. Cl. at 491; Schuerman, 30 Fed. Cl. at 425. However, the court is not
confined to an examination of the complaint when considering a motion to

2 For the purpose of this motion, we assume that the grant agreement between
HUD and the city of Detroit, attached to defendant’s motion, is a contract.

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dismiss, but may look to "‘evidentiary matters outside the pleadings."’
Schuerman, 30 Fed. Cl. at 425 (citing Cea'ars-Sz`nai Mea’. Cir. v. Watkins, 11
F.3d 1573, 1584 (Fed. Cir. 1993)). lf the court determines it does not have
jurisdiction, it may not proceed to decide a case on its merits, but must dismiss
the claim. See RCFC l2(b)(l), (h)(3); Exparte McCara’le, 74 U.S. 506, 514
(1868).

Plaintiff recognizes that she is not in direct privity of contract with the
United States but rather alleges she is a third-party beneficiary of a contract
between HUD and the city of Detroit. To determine whether a party qualifies
for third-party beneficiary status, the court looks to the contract itself to see if
the contracting parties intended to benefit the party claiming third-party status.
Schuerman, 30 Fed. Cl. at 430. While it is not necessary that the plaintiff be
mentioned specifically in the contract, she must fall within a class intended to
be benefitted by the contract. Montana v. Um`tea' States, 124 F.3d 1269, 1273
(Fed. Cir. 1997). ln determining intent, the court may ask whether the plaintiff
would be "reasonable in relying on the promise as manifesting an intention to
confer a right on him." [a’.

Even if we assumed that plaintiff falls generally within a class of
homeowners intended to benefit from the monies HUD is furnishing to the city
of Detroit, that fact is insufficient to confer upon the court jurisdiction to hear
plaintiff’s claims. When the government contracts to render services for the
public good, "members of the public are considered to be incidental
beneficiaries unless they can show a direct right to compensation." Ia’. at 1273
n. 6; Roa’riguez, 69 Fed. Cl. at 493 (dismissing case for lack of subject matter
jurisdiction when plaintiff found to be merely incidental beneficiary of third-
party contract). "Before a stranger can avail himself of the exceptional
privilege of suing for a breach of an agreement to which he is not a party, he
must, at least, show that it was intended for his direct benefit." German
Alliance Ins. C0. v. Home Water Supply Co., 226 U.S. 220, 230 (1912). In
other words, it has to be apparent from the face of the document that the
contracting parties anticipated that the ultimate recipients of the federal
expenditures could sue to receive those benefits. Defendant attached a copy
of the contract to the motion, and, upon reviewing it, we conclude that HUD’ s
grant to the city of Detroit does not confer upon members of the public the
right to sue for breach of contract and that plaintiff is, at best, an incidental
beneficiary to the contract.

Consequently, because plaintiff is neither a party to a contract with the
United States nor does she qualify as a direct third-party beneficiary of such

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a contract, we lack jurisdiction to lieai' her claims. Adclitionally, plaintiff
requests relief in the form of an order directing the government to develop
alternative methods for the distribution of l'lUD grant :noney. While we are
sympathetic with plaintiffin terms ofthe situation in which she finds herself,
the Trickcr Act does not permit this court to hear claims for equitable relief
except in very limited circumstances not present here. Goriza/es & Gonzciles
Bo)i.ds canal Ins. Agenc_i) v. Depr. of`Honvelc.'nd Ser:., 490 F.3d 940, 942 (Fed.
Cir. 2007). Aceordiiigly, de'feiidacit’s inotiori to clismiss is granted The Clcrk
of Court is directed to enter judgnient. No costs.