LOCATION: March Air Force Base
DOCKET NO.: 84-1948
DECIDED BY: Burger Court (1981-1986)
LOWER COURT: United States Court of Appeals for the Eleventh Circuit
CITATION: 476 US 926 (1986)
ARGUED: Mar 24, 1986
DECIDED: Jun 16, 1986
Bruce Neil Kuhlik - for petitioners
Theodore L. Tripp, Jr. - on behalf of the Respondents
Facts of the case
Media for Lyng v. Payne
Audio Transcription for Oral Argument - March 24, 1986 in Lyng v. Payne
Warren E. Burger:
We will hear arguments next in Secretary of Agriculture against Payne.
Mr. Kuhlik, you may proceed whenever you are ready.
Bruce Neil Kuhlik:
Thank you, Mr. Chief Justice, and may it please the Court:
This case is here on certiorari to the Court of Appeals for the Eleventh Circuit.
The decision of the Court of Appeals requires the Farmers Home Administration to reopen and accept applications now for an emergency loan program intended to tide farmers over the immediate difficulties posed by heavy rains in north Florida in 1973.
Such a result is wholly inconsistent with the purpose of the emergency loan program which was to enable farmers to make good their losses on crops that were damaged at that time and then to resume their operations with regular credit from other sources.
The loan program provided substantial government benefits, including an outright grant of $5,000 to each farmer at an interest rate of one percent.
These funds, however, could not be used to produce new crops in 1974 or subsequent years, but only to reimburse farmers for their 1973 losses so that they could remain in business at that time.
At this late date, the relief ordered by the Court of Appeals would amount to a government give-away to persons who could not reasonably have unmet needs from so long ago.
The Court of Appeals decision is insupportable.
It bars the agency from enforcing a valid regulation that established April 2, 1974 as the deadline for applying for these loans.
That result conflicts with this Court's many cases that forbid application of estoppel against the government, at least absent extraordinary circumstances that are not present here.
Moreover, the basis of the Court of Appeals decision that the agency violated a self-imposed obligation to publicize the loan program is plainly wrong.
Finally, neither this purported violation nor the violations found by the district court could support an application of estoppel in this case, especially on the classified basis ordered by the courts below.
Heavy rains struck north Florida in early April of 1973.
The area was declared a disaster area a short time later which allowed farmers to apply for emergency loans from a number of government agencies, including the FMHA, the Small Business Administration.
At the time FMHA loans carried an interest rate of five percent.
It could only be made to farmers who were unable to obtain credit elsewhere and they carried no forgiveness principal, no grant aspect to the loans.
Loans from the SBA, on the other hand, carried an interest rate of one percent, included a substantial forgiveness of principal, and could be made without a showing of unavailability of credit elsewhere.
During the time that the initial application period was open for these loans, a number of farmers obtained SBA emergency loans, they obtained regular, operating loans from the FMHA.
In January 1974, however, Congress passed Public Law 93-237, which included a grandfather clause extending the favorable terms that were previously available from the SBA, and also had been available from the FMHA for earlier disasters, to disasters up through April 20, 1973, a time period that included the north Florida flooding that is at issue in this case.
At the time, in the statute, the Congress directed the Secretary of Agriculture to extend for 90 days the application period for applying for loans under this new, more favorable emergency loan program.
Accordingly, the Secretary promulgated a regulation establishing April 2, 1974 as the deadline for applying for emergency loans under this program.
The deadline was published in the Federal Register.
At the same time, the Secretary also promulgated a regulation providing that publicity of the provisions of Public Law 93-237 would be provided to the local news media and when he issued the staff instruction that first embodied this requirement, the Secretary issued to the state FMHA officials a sample press release to be distributed to the local media.
In fact, in this case, that sample press release was distributed to the state FMHA officials and by them to the local county FMHA officials.
It was forwarded by the local officials to the local media.
It was, in fact, carried in at least two local newspapers.
Respondent filed this lawsuit in August of 1976, well over two years after the expiration of the application deadline.
With the exception of the name class representative and a few other farmers, no class member had applied for a loan, either before or after expiration of the loan application deadline.