Articles Posted in US Court of Appeals for the Federal Circuit

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Under 42 U.S.C. 1485, the USDA's Rural Housing Service (RHS) makes loans for construction of affordable rental housing. From 1972-1982, each of 10 limited partnerships (with a common general partner, Olsen) entered into a 50-year loan agreement that stated that each borrower could pay off the loan and convert its properties to conventional housing after 15 or 20 years. The 1987 Emergency Low Income Housing Preservation Act, 42 U.S.C. 1472(c)), provided that before accepting prepayment, the USDA must attempt to enter into an agreement with the borrower. In 2002, Olsen was negotiating to sell to a nonprofit organization. He notified the RHS of “intent . . . to convert [some] units into conventional housing” and sought approval to pay off the mortgages. RHS responded with a checklist. Olsen did not proceed; the potential acquirer decided against purchasing the properties. In 2011, Olsen submitted more definite prepayment requests. RHS responded with an incentive offer concerning four properties, which Olsen accepted, remaining in the program. For three other properties, RHS informed Olsen that prepayment was not an option. Olsen purportedly believed that pursuing prepayment on any properties was futile. He did not submit additional applications. In 2013, the partnerships sued, alleging that the government, through the 1987 enactment or the 2011 correspondence, violated their prepayment rights. The Federal Circuit reversed the Claims Court's dismissal. The 2002 correspondence did not trigger the RHS’s duty to accept prepayment; RHS did not take any steps inconsistent with prepayment. The government did not breach its contractual obligation in 2002. Because the alleged breaches occurred no earlier than 2011, the contract claims are not barred by the six-year limitations period. The Claims Court implicitly premised the dismissal of takings claims on the same erroneous rationale. View "Airport Road Associates, Ltd. v. United States" on Justia Law

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Louisiana law recognizes the right to extract minerals separately from ownership of the land (mineral servitudes). Servitudes generally revert back to the landowner if not used for 10 years. The servitudes at issue were established in 1932-1934, by deeds contemplating the 10-year prescriptive period. From 1934-1937, the United States acquired 180,000 acres of the encumbered land in Kisatchie National Forest. In 1940, Louisiana’s Act 315 retroactively declared that outstanding mineral rights in land sold to the United States would be imprescriptible while the government remained the landowner. Nebo acquired mineral rights in 1942, believing its rights imprescriptible. The government sought a declaratory judgment. The Fifth Circuit held that Nebo’s rights to a specific tract were imprescriptible. In 1973, the Supreme Court held that Act 315 could not be applied retroactively to land acquired by the government under the Migratory Bird Conservation Act. The Court did not overrule Nebo, distinguishing its facts. The government began issuing mineral leases. Servitude owners sought declaratory relief. The Fifth Circuit held that Act 315 could not provide the federal rule of decision and that the Kisatchie servitudes had prescribed. The Supreme Court denied certiorari. One servitude holder sued in the Claims Court, based on the same facts. The Federal Circuit affirmed dismissal of permanent takings claims, contract claims, and some temporary takings claims under the statute of limitations. The Claims Court subsequently held that remaining temporary takings claims were barred by 28 U.S.C. 1500; because the judicial takings claim would require the Claims Court to question the merits of the Fifth Circuit’s decision it also lacked jurisdiction over those claims. View "Petro-Hunt, L.L.C. v. United States" on Justia Law