Court Opinion

ID: 6800382
Source: CourtListenerOpinion
Date Created: 2022-07-21 17:00:58.331256+00
Date Added: 2024-06-11T12:08:33.460472
License: Public Domain

Appellate Case: 21-7061     Document: 010110714336       Date Filed: 07/21/2022     Page: 1
                                                                                   FILED
                                                                       United States Court of Appeals
                       UNITED STATES COURT OF APPEALS                          Tenth Circuit

                              FOR THE TENTH CIRCUIT                            July 21, 2022
                          _________________________________
                                                                          Christopher M. Wolpert
                                                                              Clerk of Court
  CHRISTINA ANN FARHAT, as personal
  representative of the estate of William
  Edward Farhat, Jr., deceased; KIMBERLY
  DIANE PAGE, as personal representative
  of the estate of Kristy Farhat, deceased;
  KAYLEE WALDEN, as personal
  representative of the estate of Physher
  Wyatt Farhat, deceased, and as guardian of
  Weston Buck Farhat; and MELISSA HILL,
  guardian of the estate of Brayden Wayne
  Hill, a minor,

        Plaintiffs - Appellants,

  v.                                                          No. 21-7061
                                                     (D.C. No. 6:19-CV-00401-SPS)
  UNITED STATES OF AMERICA,                                   (E.D. Okla.)

        Defendant - Appellee.
                       _________________________________

                              ORDER AND JUDGMENT*
                          _________________________________

 Before TYMKOVICH, Chief Judge, MATHESON and EID, Circuit Judges.
                  _________________________________

       *
         After examining the briefs and appellate record, this panel has determined
 unanimously to honor the parties’ request for a decision on the briefs without oral
 argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore
 submitted without oral argument. This order and judgment is not binding precedent,
 except under the doctrines of law of the case, res judicata, and collateral estoppel. It
 may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1
 and 10th Cir. R. 32.1.
Appellate Case: 21-7061    Document: 010110714336         Date Filed: 07/21/2022     Page: 2

       Plaintiffs filed their claims under the Suits in Admiralty Act (SIAA) after the

 expiration of the SIAA’s two-year statute of limitations. Holding that plaintiffs

 failed to allege facts demonstrating tolling agreements or grounds for equitable

 tolling, the district court dismissed their amended complaint for failure to state a

 claim. Exercising jurisdiction under 28 U.S.C. § 1291, we affirm.

 I.    Background

       A.     Original Complaint

       Plaintiffs’ original complaint described a tragic boating accident on the

 McClellan-Kerr Arkansas River Navigational System (MKARNS). The MKARNS

 runs primarily along the Arkansas River in Oklahoma and Arkansas and consists of a

 series of locks and dams, ports, reservoirs, and recreational areas. The United States

 Army Corps of Engineers maintains and operates the MKARNS.

       On April 23, 2017, the Farhat family was boating on the MKARNS when their

 boat’s motor failed and the boat drifted toward a lock and dam gates. The boat struck

 a gate and all four passengers were pulled under water. William Edward Farhat, Jr.,

 Kristy Farhat, and one of the couple’s children died as a result of the accident. A

 second Farhat child survived but sustained injuries.

       On or before February 5, 2019, the Farhats’ representatives, who are the

 plaintiffs in this action, filed notices of administrative claims with the Army pursuant

 to the Federal Tort Claims Act (FTCA).1 After the Army had made no determination

       1
          The plaintiffs also include a representative of an additional surviving minor
 child of Mr. Farhat who was not involved in the boating accident.
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 on their administrative claims, plaintiffs filed this action against the United States on

 November 22, 2019, asserting claims under the FTCA. Plaintiffs alleged that the

 Army Corps of Engineers failed to exercise reasonable care in maintaining the

 MKARNS and failed to warn of dangerous conditions, resulting in the deaths of the

 Farhat family members and injuries to the surviving children.

       B.     First Motion to Dismiss

       The United States moved to dismiss the complaint under Federal Rules of

 Civil Procedure 12(b)(1) and 12(b)(6). It first contended that because plaintiffs’

 claims arose under maritime and admiralty law, the SIAA provided their exclusive

 remedy, and plaintiffs could not bring their claims under the FTCA. Next, because

 the accident occurred on April 23, 2017, and plaintiffs did not file their complaint

 until November 22, 2019, the United States argued that their claims were time-barred

 under the SIAA’s two-year statute of limitations. See 46 U.S.C. § 30905 (providing

 that “[a] civil action under this chapter must be brought within 2 years after the cause

 of action arose”). Asserting that a timely filing under § 30905 is jurisdictional, the

 United Stated sought dismissal of the complaint for lack of subject-matter

 jurisdiction under Rule 12(b)(1). Alternatively, if the district court determined that

 § 30905 is not jurisdictional, the United States sought dismissal under Rule 12(b)(6)

 for failure to state a claim upon which relief can be granted.

       In opposing the United States’ dismissal motion, plaintiffs conceded that their

 claims arose under the SIAA rather than the FTCA but argued that the limitations

 period in § 30905 is not jurisdictional and is therefore subject to equitable tolling.

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 Plaintiffs contended equitable tolling was appropriate in their case because the Army

 had actively misled them in letters responding to their administrative claims under

 the FTCA by (1) stating that the statute of limitations was tolled indefinitely or until

 the Army took final administrative action on their claims, and (2) discouraging them

 from filing suit until they had received written notification of final administrative

 action by the Army. Plaintiffs asserted that they relied on the Army’s affirmative

 statements and that the Army had effectively entered into tolling agreements with

 them. Plaintiffs attached copies of the Army’s letters to their response.

       The district court granted the United States’ motion to dismiss under

 Rule 12(b)(6) for failure to state a claim. It agreed with the parties that the SIAA

 applied to plaintiffs’ claims, which they had filed seven months after the expiration

 of the SIAA’s two-year limitations period. The district court also held that § 30905

 is not jurisdictional and is subject to equitable tolling. Assessing whether to grant

 plaintiffs equitable tolling, the court held they bore the burden of establishing two

 elements: (1) they had diligently pursued their rights, and (2) some extraordinary

 circumstance stood in their way. See Chance v. Zinke, 898 F.3d 1025, 1034

 (10th Cir. 2018).

       The district court concluded that plaintiffs’ complaint did not plausibly allege

 either their own diligence or the existence of any extraordinary circumstance. The

 court acknowledged plaintiffs’ allegation that they had filed administrative claims

 against the Army under the FTCA. But it concluded that the SIAA has neither an

 administrative prerequisite nor a provision tolling its limitations period upon filing an

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 administrative claim. The court further observed that “[i]t is well-established that the

 filing of an administrative claim under the FTCA will not toll the limitations period

 for an action under the [SIAA].” Aplt. App. at 72 (internal quotation marks omitted).

 Therefore, the SIAA’s statute of limitations continued to run while plaintiffs pursued

 administrative remedies under the FTCA. And the court deemed plaintiffs’ failure to

 diligently research the existence of a possible claim under the SIAA to be “a garden

 variety claim of excusable neglect” that did not support a grant of equitable tolling.

 Id. (internal quotation marks omitted).

        The district court declined to consider plaintiffs’ new assertions that the Army

 induced them to believe that the SIAA’s statute of limitations was tolled and had

 discouraged them from filing suit before final agency action. It noted these

 allegations were based upon the Army’s letters that plaintiffs had not attached to or

 referenced in their complaint. But the court granted plaintiffs leave to file an

 amended complaint “alleging any basis not heretofore addressed for application of

 the doctrine of equitable tolling.” Id. at 74. It added the following cautionary

 language:

        [A]mendment might permit the Court to reconsider the Plaintiffs’ equitable
        tolling argument in light of the correspondence excluded above, if the
        Plaintiffs attach such correspondence to the amended complaint and include
        additional allegations that explain how the correspondence misled them or
        otherwise prohibited them from timely asserting their claims under the
        [SIAA]. It is doubtful that the correspondence standing alone would justify
        equitable tolling in this case, but the issue has not been fully addressed and
        the Court is therefore reluctant to conclude at this juncture that amendment
        would be futile.
 Id. at 73-74.

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        C.     Amended Complaint

        Plaintiffs filed an amended complaint, this time attaching the Army’s letters.

 They referenced language from the letters stating that their claims were being

 processed under the FTCA and that the “[f]iling of an administrative claim tolls the

 statute of limitations indefinitely or until the Army takes final administrative action

 in writing on the claim.” Id. at 77 (internal quotation marks omitted). Plaintiffs

 alleged that the Army advised that they could “file a lawsuit six months after the

 claim was filed” but that “filing suit is not required, particularly if satisfactory

 progress is being made in the administrative claims process.” Id. (internal quotation

 marks omitted). The Army then reiterated that, if plaintiffs “do not file suit, the

 statute of limitations will be tolled until you are notified in writing by certified mail

 of the final administrative action by the Army.” Id. (internal quotation marks

 omitted). Plaintiffs further alleged that “[t]he Army’s affirmative representation that

 the two-year statute of limitations was tolled indefinitely, or until the Army takes

 final administrative actions, entered the parties into a tolling agreement.” Id. at 78.

        D.     Second Motion to Dismiss

        The United States moved to dismiss plaintiffs’ amended complaint for failure

 to state a claim under Rule 12(b)(6), arguing their SIAA claims were untimely and

 their allegations failed to support a grant of equitable tolling. Plaintiffs responded

 that they had pleaded the existence of implied-in-fact tolling agreements with the

 Army. They also argued the statute of limitations should be equitably tolled because

 the statements in the Army’s letters had affirmatively misled them.

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       The district court granted the United States’ motion. It first rejected plaintiffs’

 tolling-agreement contention, noting “a number of problems” with it, id. at 126:

 (1) plaintiffs’ allegations in their amended complaint referenced written, rather than

 implied-in-fact, contracts; (2) the court had granted leave to amend to allege facts

 supporting equitable tolling, but nothing in the amended complaint suggested that an

 implied-in-fact contract would form a basis for that relief; and (3) any contract

 formed between the parties “would be confined to its express terms, i.e., that the

 statute of limitations for any claim under the FTCA would be tolled until the issuance

 of final administrative [action] by the [Army].” Id. at 127.

       The district court also found no merit in plaintiffs’ equitable-tolling argument,

 concluding that their amended complaint alleged neither their diligence nor any

 extraordinary circumstance. Plaintiffs made the following factual allegations: they

 filed administrative claims under the FTCA for injuries suffered on the navigable

 waters of the United States; the Army advised them the statute of limitations under

 the FTCA would be tolled pending final administrative action; plaintiffs filed an

 FTCA action more than two years after the accident occurred; and they first learned

 that their exclusive remedy was under the SIAA when the United States moved to

 dismiss. Concluding that diligent research would likely have revealed both the

 existence of their SIAA cause of action and the two-year limitations period, the court

 held that the facts alleged in plaintiffs’ amended complaint failed to justify equitable

 tolling of the SIAA’s statute of limitations. See Ayers v. United States, 277 F.3d 821,

 828-29 (6th Cir. 2002) (affirming district court’s denial of equitable tolling of the

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 SIAA’s statute of limitations under similar facts). Moreover, the district court also

 addressed plaintiffs’ contention (which they failed to allege in their amended

 complaint) that they were actively misled because the Army knew their claims were

 governed by the SIAA when it stated that the FTCA’s statute of limitations was

 tolled. The court concluded it could discern no such design by the Army based upon

 its letters to plaintiffs. The district court therefore dismissed plaintiffs’ action for

 failure to state a claim and entered judgment for the United States.

 II.    Discussion

        On appeal, plaintiffs’ focus remains on the Army’s letters in response to their

 administrative claims under the FTCA. They argue that, through its statements about

 tolling “the statute of limitations,” Aplt. App. at 77 (internal quotation marks

 omitted), the Army effectively entered into implied-in-fact agreements with plaintiffs

 to toll the statute of limitations under the SIAA. Plaintiffs further assert that the

 Army’s letters actively misled them such that equitable tolling should be applied to

 their claims under the SIAA. Plaintiffs’ contentions thus hinge on the SIAA’s statute

 of limitations being a claims-processing rule subject to tolling rather than a

 jurisdictional mandate. We first address this jurisdictional question before turning to

 plaintiffs’ arguments.

        A.     District Court’s Subject Matter Jurisdiction

        The United States does not challenge the district court’s holding that a timely

 filing under § 30905 is not a jurisdictional requirement. But “[w]e are obligated to

 satisfy ourselves as to our own jurisdiction and this obligation extends to an

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 examination of the federal district court’s jurisdiction as well.” Comanche Indian

 Tribe of Okla. v. Hovis, 53 F.3d 298, 302 (10th Cir. 1995). We review this issue

 de novo. See id.

       If a statute of limitations is jurisdictional, a failure to comply deprives courts

 of authority to hear the case. United States v. Kwai Fun Wong, 575 U.S. 402, 408-09

 (2015). Thus, “courts can’t toll statutes of limitations that deprive them of

 jurisdiction.” Chance, 898 F.3d at 1030. But a nonjurisdictional time limit can be

 equitably tolled, even when it governs litigation against the United States. See Kwai

 Fun Wong, 575 U.S. at 412; see also Irwin v. Dep’t of Veterans Affs., 498 U.S. 89,

 95-96 (1990) (“[T]he same rebuttable presumption of equitable tolling applicable to

 suits against private defendants should also apply to suits against the United States.

 Congress, of course, may provide otherwise if it wishes to do so.”).

       The Supreme Court has “made plain that most time bars are nonjurisdictional.”

 Kwai Fun Wong, 575 U.S. at 410. To conclude otherwise as to a particular provision,

 “traditional tools of statutory construction must plainly show that Congress imbued a

 procedural bar with jurisdictional consequences.” Id. Accordingly, “Congress must

 do something special, beyond setting an exception-free deadline, to tag a statute of

 limitations as jurisdictional and so prohibit a court from tolling it.” Id.

       The SIAA’s statute of limitations provides: “A civil action under this chapter

 must be brought within 2 years after the cause of action arose.” 46 U.S.C. § 30905.

 We have not yet decided whether a timely filing under § 30905 is a jurisdictional

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  requirement.2 Under the reasoning in Kwai Fun Wong, § 30905 is not jurisdictional.

  Its text “is mundane statute-of-limitations language,” which “speaks only to a claim’s

  timeliness, not to a court’s power.” 575 U.S. at 410. Section 30905 “does not speak

  in jurisdictional terms or refer in any way to the jurisdiction of the district courts.”

  Id. at 411 (internal quotation marks omitted). In the absence of a clear statement by

  Congress that § 30905 is jurisdictional, we conclude it is “a mere claims-processing

  rule” that may be subject to equitable tolling. Id. at 420. Therefore, the district court

  did not exceed its jurisdiction in considering whether to toll the SIAA’s time

  limitation or by dismissing plaintiffs’ claims for failure to state a claim rather than

  for lack of jurisdiction.

  2
    Several other circuits have addressed and reached differing results on the question
  whether a precursor version of the SIAA’s statute of limitations was jurisdictional.
  Compare Hedges v. United States, 404 F.3d 744, 747-48 (3d Cir. 2005) (holding the
  SIAA’s two-year statute of limitations, previously codified at 46 U.S.C. § 745, was
  not jurisdictional and therefore subject to equitable tolling), with Smith v. United
  States, 873 F.2d 218, 221 (9th Cir. 1989) (holding § 745 was jurisdictional), Nan
  Sing Marine Co. v. United States, 811 F.2d 1495, 1497 (Fed. Cir. 1987) (same), and
  Szyka v. U.S. Sec’y of Def., 525 F.2d 62, 65 (2d Cir. 1975) (same), with Ayers,
  277 F.3d at 828 (holding § 745 was jurisdictional and subject to equitable tolling).
  Other circuits have held that the SIAA’s precursor statute of limitations was subject
  to equitable tolling without explicitly holding it was nonjurisdictional. See Wilson v.
  U.S. Gov’t, 23 F.3d 559, 561-62 (1st Cir. 1994) (denying equitable tolling); Favorite
  v. Marine Pers. & Provisioning, Inc., 955 F.2d 382, 388-89 (5th Cir. 1992) (same);
  Raziano v. United States, 999 F.2d 1539, 1540-42 (11th Cir. 1993) (reversing grant
  of equitable tolling). All of these cases predated Kwai Fun Wong and none
  considered whether the specific language in § 30905 is jurisdictional.

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        B.       Standard of Review

        “We review de novo the dismissal of an action under Rule 12(b)(6) based on

  [a] statute of limitations.” Braxton v. Zavaras, 614 F.3d 1156, 1159 (10th Cir. 2010).

  “Although timeliness is an affirmative defense, if the allegations show that relief is

  barred by the applicable statute of limitations, the complaint is subject to dismissal

  for failure to state a claim.” Chance, 898 F.3d at 1034 (citation, ellipsis, brackets,

  and internal quotation marks omitted).

        C.       Tolling Agreements

        Based upon statements in the Army’s letters to them, plaintiffs argue that the

  Army effectively entered into implied-in-fact agreements to toll the SIAA’s two-year

  statute of limitations. Their contention fails to address any of the three problems the

  district court identified in their tolling-agreement theory or show error in the court’s

  analysis. In particular, plaintiffs did not allege any written or implied offers or

  promises by the Army to toll the statute of limitations under the SIAA. Considered in

  their entirety, the statements in the Army’s letters about “The Act” and tolling of “the

  statute of limitations” clearly referred to the FTCA and the FTCA’s statute of

  limitations:

               The SF-95 [claim form] is being processed under the Federal Tort
        Claims Act (28 U.S.C. §§ 2671-2680). The Act contains a mandatory
        six-month administrative investigation and period in which settlement may
        occur. Filing of an administrative claim tolls the statute of limitations
        indefinitely or until the Army takes final administrative action in writing on
        the claim. Final administrative action consists of a denial or final
        settlement offer.

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                 The Act permits you to file a lawsuit six months after the claim was
         filed, provided the claim has been properly filed and adequately
         documented (28 U.S.C. § 2675(a)). However, filing suit is not required,
         particularly if satisfactory progress is being made in the administrative
         claims process. If you do not file suit, the statute of limitations will be
         tolled until you are notified in writing by certified mail of the final
         administrative action by the Army.
  Aplt. App. at 84, 86, 88, 90, 92 (emphasis added). Plaintiffs rely entirely on these

  statements in the Army’s letters; they did not plead any other non-conclusory factual

  allegations demonstrating tolling agreements related to the SIAA’s time limitation.

  Therefore, the district court did not err in holding that plaintiffs failed to allege such

  agreements between plaintiffs and the Army.

         D.     Equitable Tolling3

         Equitable tolling is discretionary and “is granted sparingly.” Chance, 898 F.3d

  at 1034 (internal quotation marks omitted). Dismissal for failure to state a claim is

  appropriate where a complaint’s “allegations, even if proved, don’t warrant tolling

  the limitations period.” Id. Here, the district court correctly focused on whether

  plaintiffs alleged that they diligently pursued their rights and that some extraordinary

  circumstance stood in their way. See id.

         Plaintiffs contend they pleaded an extraordinary circumstance because the

  Army actively misled them “by stating that the statute of limitations was tolled and

  discouraging [them] from filing suit until [they] received notification in writing by

         3
           We assume without deciding that § 30905 may be equitably tolled because,
  even if it can be, plaintiffs are not entitled to equitable tolling in this case. See
  Chance, 898 F.3d at 1034 n.6.
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  certified mail of final administrative action by the Army.” Aplt. Br. at 9. Although a

  “limitations period may be tolled where a claimant has been actively misled,”

  Chance, 898 F.3d at 1035 (internal quotation marks omitted), plaintiffs’ contention

  suffers from the same defect as their tolling-agreement theory: the Army’s letters

  stated only that the FTCA’s statute of limitations was tolled while their

  administrative claims under that statute were pending. The Army made no

  representation about the SIAA’s time limitation. Plaintiffs also assert (although they

  failed to allege in their amended complaint) that (1) the Army “knew the claim was

  governed by the SIAA and actively misled [plaintiffs] into believing that the statute

  of limitation[s] was tolled,” and (2) the Army’s “sinister” motive is revealed in its

  encouragement not to file suit while plaintiffs’ administrative claims were

  progressing. Aplt. Br. at 9-10. But the district court concluded, and we agree, that

  no such intent to mislead plaintiffs regarding their SIAA claims can be reasonably

  inferred from the Army’s letters.

        Moreover, even were plaintiffs to plead facts sufficient to demonstrate such an

  intent, their claims for equitable tolling would still fail because a defendant’s active

  misleading will not excuse a plaintiff’s lack of diligence. See Chance, 898 F.3d at

  1035. As the district court concluded, diligent research would likely have revealed

  both the existence of plaintiffs’ SIAA cause of action and the applicable two-year

  limitations period. Yet despite the district court’s invitation to do so in granting them

  leave to amend, plaintiffs pleaded no facts demonstrating their diligence in

  identifying and pursuing their SIAA remedy.

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  III.   Conclusion

         The district court did not err in dismissing plaintiffs’ amended complaint for

  failure to state a claim because they failed to plead facts supporting the existence of

  tolling agreements or grounds to equitably toll the SIAA’s two-year statute of

  limitations. It was therefore apparent from the face of their amended complaint that

  their SIAA claims were untimely. Consequently, we affirm the district court’s

  judgment.

                                              Entered for the Court

                                              Timothy M. Tymkovich
                                              Chief Judge

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