Beggerly v. United States , 148 F.3d 1179 ( 1997 )

  •                                        REVISED
                        UNITED STATES COURT OF APPEALS
                             FOR THE FIFTH CIRCUIT
                                          No. 95-60625
                           Appeal from the United States District Court
                             For the Southern District of Mississippi
                                          July 28, 1997
                                          On Rehearing
    Before POLITZ, Chief Judge, EMILIO M. GARZA and STEWART, Circuit Judges.
    POLITZ, Chief Judge:
          The panel substitutes the following for its opinion previously issued:
          The Beggerlys appeal the district court’s order granting the motion to dismiss
    by the United States and denying the Beggerlys’ cross-motion for summary
    judgment in which they sought to vacate a consent judgment under which the
    United States acquired title to property previously held by the Beggerlys.
    Concluding that the Beggerlys are entitled to the relief sought, we reverse, render,
    and remand.
             On April 3, 1950 Clark M. Beggerly, Sr., on behalf of his family, bought a
    portion of Horn Island, offshore in the Gulf of Mexico, at a tax sale in Jackson,
    Mississippi. On January 8, 1971 Congress enacted legislation authorizing the
    Department of Interior to establish a federal park on lands that included Horn
    Island.1 In 1972 the National Park Service began negotiating with the Beggerlys
    for the purchase of their property on Horn Island. In October 1975 the Beggerlys
    entered into a contract to sell the land to the government for $156,500.
    Subsequently the government canceled the contract contending that because it had
    never issued a land patent, it was the title owner of Horn Island.
             In 1979 the government brought a quiet title action in the Southern District
    of Mississippi against the Beggerlys and other defendants. During discovery the
    Beggerlys sought proof of their title, and government officials ostensibly conducted
    a thorough search of the public land records. The government then formally
    represented to the Beggerlys and the district court that no part of Horn Island had
    ever been granted to a private landowner and, as a result of these representations,
    in 1982 the government persuaded the Beggerlys to accept a settlement agreement
    it proposed. The district court entered judgment based upon that agreement; the
    Beggerlys received $208,175.87 and title was quieted in favor of the United States.2
             Their disappointment with the results of the settlement led the Beggerlys to
           16 U.S.C. § 459h.
           United States v. Adams, No. S79-0338(R) (S.D. Miss. Dec. 3, 1982).
    mount an exhaustive search for a land patent to support their claim of title. They
    wrote letters to public officials, made Freedom of Information Act requests, and
    searched land records in Alabama, Mississippi, Louisiana, and Washington, D.C.
    Finally, in 1991 the Beggerlys hired a genealogical record specialist who conducted
    research in the National Archives and discovered the Boudreau Grant which
    supported the Beggerlys’ claim of title. Government officials reportedly had
    searched the National Archives during the quiet title suit but had not discovered
    this document and thereafter erroneously advised the court and the Beggerlys that
    Horn Island had never been privately disposed. The Beggerlys contacted the
    Bureau of Land Management requesting the issuance of a land patent for Horn
    Island. The BLM summarily denied their request.
             The Beggerlys then filed the instant action on June 1, 1994 seeking to set
    aside the consent judgment and to recover just compensation. The government
    moved to dismiss the complaint, invoking Fed.R.Civ.P. 12(b)(6) and 12(b)(1). The
    Beggerlys filed a cross-motion for summary judgment and filed an amended
    motion to add the Tucker Act3 and the Quiet Title Act4 as jurisdictional bases. The
    district court granted the government’s motion to dismiss and denied the
    Beggerlys’ cross-motion for summary judgment and motion to amend. The
    Beggerlys timely appealed.
           28 U.S.C. § § 1346, 1491.
           28 U.S.C. § 2409a.
             1. Sovereign Immunity
             The government contends that sovereign immunity bars the Beggerlys from
    proceeding with an independent action in equity. The government relies on Zegura
    v. United States5 in which we held that sovereign immunity barred a bill of review
    brought to vacate a prior judgment obtained by the United States. The Eleventh
    Circuit viewed Zegura as controlling authority for the proposition that an
    independent action could not be brought against the government absent a waiver
    of sovereign immunity.6 We are not so persuaded and do not find Zegura as
    controlling herein. Zegura dealt only with a bill of review, which is a type of
    equitable action that has been replaced by the motions enumerated in Fed.R.Civ.P.
    60(b). Although an independent action in equity is similar to a bill of review and
    its modern successors -- the Rule 60(b) motions -- it is nonetheless a different
    action. Rule 60(b) makes the distinction clear, stating that it does not “limit the
    power of a court to entertain an independent action.” We therefore conclude that
    Zegura does not control in the independent action context.
             We have held that an independent action filed in the same court that rendered
    the original judgment is a continuation of the original action for purposes of subject
    matter jurisdiction.7 It would be anomalous to torpedo a party bringing the
    independent action with a plea of sovereign immunity when the action is in reality
    104 F.2d 34
     (5th Cir.), cert. denied, 
    308 U.S. 586
           United States v. Timmons, 
    672 F.2d 1373
     (11th Cir. 1982).
        West Virginia Oil & Gas Co. v. George E. Breece Lumber Co., 
    213 F.2d 702
    (5th Cir. 1954).
    a continuation of the original lawsuit in which jurisdiction was not an issue. To
    allow the government to use sovereign immunity as a shield where it previously has
    invoked the court’s jurisdiction and prevailed in an action based upon its
    misrepresentations, negligence, or mistake would do unacceptable violence to our
    basic notions of justice. We therefore agree with our colleagues in the Second
    Circuit and now conclude and hold that governmental consent is not required to
    bring an independent action in the same court as the original action.8
               2. The Independent Action
               The elements of an independent action are:
               (1) a judgment which ought not, in equity and good conscience, to be
               enforced; (2) a good defense to the alleged cause of action on which
               the judgment is founded; (3) fraud, accident, or mistake which
               prevented the defendant in the judgment from obtaining the benefit of
               his defense; (4) the absence of fault or negligence on the part of the
               defendant; and (5) the absence of any adequate remedy at law.9
    The Beggerlys have satisfied these elements. We now hold that the district court
    erred as a matter of law in denying the Beggerlys’ action to vacate the consent
    judgment. Crucial to that determination is our conclusion that the district court
    erred in failing to recognize the validity of the Boudreau Grant. That document is
    an English translation of a 1781 Spanish land grant in which the Governor General
    of Spanish Louisiana conveyed Horn Island to Catarina Boudreau. Although the
           Weldon v. United States, 
    70 F.3d 1
     (2d Cir. 1995).
         Bankers Mortgage Co. v. United States, 
    423 F.2d 73
     (5th Cir.) (quoting
    National Sur. Co. v. State Bank, 
    120 F. 593
    , 599 (8th Cir. 1903)), cert. denied, 
    90 S. Ct. 2242
    available document is not the original grant, it is the only copy available,
    presumably because a fire destroyed the Spanish West Florida archives where the
    original Spanish version would have been stored. The Supreme Court has held that
    a certified translation of a Spanish land grant may be used to prove the existence
    of a grant where the original cannot be found or has been destroyed.10 We therefore
    find and conclude that the English translation is the best evidence of the original
    grant and is admissible to prove its existence.
             The government contended at oral argument that the Boudreau Grant was
    merely an application for a land patent. In the early 19th century Congress
    established land commissions to organize the private claims of landowners, in what
    are now the states of Louisiana, Mississippi, Alabama, and Florida, who had
    acquired their property from England, France, or Spain.                Heirs of Catarina
    Boudreau presented the Boudreau Grant to the land commissioner for claims east
    of the Pearl River. It was not accepted. The land commissioners were responsible
    for ascertaining titles and claims but did not have the authority to adjudicate title.
    The controlling statute required that the commissioners submit claims to Congress
    for final action.11 We must therefore conclude that the land commissioner’s refusal
    to accept the application did not conclusively determine that Horn Island belonged
    to the United States.
             It is abundantly clear that the land commissioners did not have the authority
            United States v. Delespine’s Heirs, 37 U.S. (12 Pet.) 654 (1838).
       Act of April 25, 1812, 2 Stat. 713; see generally United States v. Percheman,
    32 U.S. (7 Pet.) 51 (1833).
    to confiscate property rightfully owned by private individuals. It is well-settled
    that, absent a specific congressional act, land validly granted by a foreign nation
    remained privately owned after the United States acquired political control of the
    subject area. Chief Justice John Marshall taught:
             The modern usage of nations, which has become law, would be
             violated; that sense of justice and of right which is acknowledged and
             felt by the whole civilized world would be outraged, if private
             property should be generally confiscated, and private rights annulled.
             The people change their allegiance; their relation to their ancient
             sovereign is dissolved; but their relations to each other, and their rights
             of property, remain undisturbed.12
    Articles II and III of the treaty consummating the Louisiana Purchase, under which
    the United States acquired property south of the 31st parallel where Horn Island is
    located,13 expressly protected the rights of private landowners. We consider it
    beyond serious debate that if the Boudreau Grant was a valid land grant under the
    Spanish law of 1781, then Horn Island remained private property after the
    Louisiana Purchase. If, however, the grant was incomplete or invalid under
    Spanish law, then the land commissioner was justified in his rejection. We inquire,
    therefore, as to the validity of the Boudreau Grant under Spanish law at the time it
    was made. The summary judgment record contains an affidavit by Professor Hans
    Baade, offered by the Beggerlys as evidence that the Boudreau Grant was complete
    and valid under the Spanish law of 1781. On the record before us the Boudreau
    Grant vested complete and valid title in Catarina Boudreau. On that record,
            Percheman at 86-87.
         United States v. Louisiana, 
    363 U.S. 1
     (1960); Foster v. Neilson, 27 U.S. (2
    Pet.) 253 (1829), overruled on other grounds by Percheman.
    therefore, we must conclude that the property at issue herein remained privately
    owned after the Louisiana Purchase and did not enter the public domain of the
    United States until the misrepresentation-based consent judgment of 1982.
              The government possessed a document that was vital to the Beggerlys’ claim
    of title to the land they had acquired on Horn Island.          Notwithstanding, it
    represented to the Beggerlys and to the district court that no evidence existed that
    Horn Island had ever been privately owned. This representation precipitated the
    Beggerlys’ involuntary settlement of the government’s lawsuit. Their inability to
    prove their title was directly caused by the government’s failure to produce the
    grant and its misrepresentation that no private disposal had ever been made. Equity
    permits us to correct injustice in extraordinary and unusual circumstances such as
    are here presented. We exercise that authority and as to the Beggerlys set aside the
    challenged consent judgment as null and void ab initio.14
              3. Quiet Title Act Claim
              The Beggerlys filed a motion to amend their complaint to claim relief under
    the Quiet Title and Tucker Acts. The district court denied that motion. We read
    the Beggerlys’ complaint and motion for summary judgment as stating alternative
    causes of action. Although the district court did not have jurisdiction over an
    inverse condemnation action under the Tucker Act,15 it did have jurisdiction to
         We note that there are no fixed time limitations on bringing an independent
    action in equity. In re West Texas Mktg. Corp., 
    12 F.3d 497
     (5th Cir. 1994).
     See 28 U.S.C. §§ 1346, 1491 (vesting exclusive jurisdiction in the Federal Court
    of Claims for claims exceeding $10,000).
    adjudicate title under the Quiet Title Act. We conclude that the district court
    abused its discretion and should have allowed the Beggerlys to amend their
    complaint because “[t]he requested amendment would have done no more than
    state an alternative jurisdictional basis for recovery upon the facts previously
             The record reflects that the Beggerlys legally acquired a part of Horn Island
    in a tax sale. Because we have set aside the earlier judgment as to the Beggerlys
    and have found that the United States has no legitimate claim to the land, the
    validity of the Beggerlys’ title is a legal certainty. The government maintains,
    however, that a claim under the Quiet Title Act is barred unless it is commenced
    within 12 years of the date on which it accrued.17 A claim is deemed to accrue on
    the date the plaintiff knows or should have known about the claim of the United
    States.18 The Beggerlys knew about the claim at the earliest in 1976 when the
    government ceased contract negotiations with them for the purchase of their Horn
    Island property. More than 12 years passed before the Beggerlys commenced the
    current action; however, a statute of limitations may be tolled on equitable grounds.
    “Equitable tolling applies principally where the plaintiff is actively misled by the
    defendant about the cause of action or is prevented in some extraordinary way from
            Miller v. Stanmore, 
    636 F.2d 986
    , 990 (5th Cir. 1981).
            28 U.S.C. § 2409a(g).
    asserting his rights.”19 On the record before us the government may not benefit
    from the limitations period, especially in light of the diligence displayed by the
    Beggerlys in seeking the truth and pursuing their rights, which resulted in their
    discovering a grant that apparently not even custodians of the public land records
    could or would locate. We conclude that the limitations period was tolled from the
    time the Beggerlys began searching for evidence of a private disposal during the
    original quiet title action until they discovered the Boudreau Grant and, thus, that
    their action manifestly was filed within the 12-year limitations period.
             We remand to the district court so that it may enter judgment quieting title
    in favor of the Beggerlys. Under 28 U.S.C. § 2409a(b) the United States has the
    option of delivering possession of the 729 acres claimed by the Beggerlys or it may
    elect to retain possession thereof and pay the Beggerlys just compensation for
    same. The district court is to take into account the compensation of $208,175.87
    received by the Beggerlys in the 1982 settlement. The judgment of the district
    court is REVERSED and judgment is RENDERED in favor of the Beggerlys and
    this cause is REMANDED for further proceedings consistent herewith.
         Rashidi v. American President Lines, 
    96 F.3d 124
    , 128 (5th Cir. 1996).
    Equitable tolling may be applied against the United States. Irwin v. Department
    of Veterans Affairs, 
    111 S. Ct. 453
    EMILIO M. GARZA, Circuit Judge, dissenting:
          I agree with much of today’s majority opinion. I agree with the majority that
    the complaint is not a motion under Fed. R. Civ. P. 60(b)(1)-(6), and that it should
    more properly be considered an independent action in equity, since Beggerly
    explicitly invoked the equitable jurisdiction of the district court in his complaint.
    I agree with the majority that the district court erred in dismissing the action as
    untimely, because there is no fixed limitations period for such equitable actions.
    And finally, I agree with the majority that the equities of this case favor Beggerly
    and his family. However, because we do not have jurisdiction to provide such
    relief, I must part company with the majority. As judges, we have equitable
    discretion to do justice within the limits of the law, but we can go no further. In
    this case, the government has not waived its sovereign immunity to suit, which bars
    our jurisdiction to provide relief.
          As an initial matter, I would not treat an independent action
    in equity as a “continuation” of the underlying suit with ancillary
    jurisdiction from the original action.              In a similar context, the
    Supreme Court appears to have foreclosed the notion of ancillary
    jurisdiction in cases such as this one, involving a challenge to a
    settlement agreement in federal court.              Kokkonen v. Guardian Life
    Ins. Co. of Am., 
    511 U.S. 375
    , 380, 
    114 S. Ct. 1673
    , 1676, 128 L.
    Ed. 2d 391 (1994) (“No case of ours asserts, nor do we think the
    concept of limited federal jurisdiction permits us to assert,
    ancillary jurisdiction over any agreement that has as part of its
    consideration the dismissal of a case before a federal court.”).
           Furthermore, the Fifth Circuit has long held that independent
    actions must have jurisdiction independent of the judgments they
    challenge.     Bankers Mortgage Trust Co. v. United States, 
    423 F.2d 73
    , 78 (5th Cir.), cert. denied, 
    399 U.S. 927
    90 S. Ct. 2242
    26 L. Ed. 2d 793
     (1970); Jones v. Watts, 
    142 F.2d 575
     (5th Cir.),
    cert. denied, 
    323 U.S. 787
    65 S. Ct. 310
    89 L. Ed. 628
    Zegura v. United States, 
    104 F.2d 34
    , 35 (5th Cir.), cert. denied,
    308 U.S. 586
    60 S. Ct. 109
    84 L. Ed. 490
           West Virginia Oil & Gas v. George E. Breece Lumber, cited by
    the majority, appears to have created an exception to this general
    rule.   West Virginia Oil was a federal diversity case in which the
    parties to the original action were diverse, but after judgment,
    sales of the property at stake defeated complete diversity.                      
    213 F.2d 702
    , 704 (5th Cir. 1954).           In West Virginia Oil, we held that
    the district court had continuing diversity jurisdiction to correct
    errors in the original judgment.              Id. at 706-07.      The “ancillary
    jurisdiction” reasoning of West Virginia Oil has little or no
           I recognize that there is a conflict among the other circuits regarding whether
    independent actions require independent jurisdiction. Compare Weldon v. United
    70 F.3d 1
    , 4 (2d Cir. 1995) (holding that independent actions are ancillary
    to original suit) and Crosby v. Mills, 
    413 F.2d 1273
    , 1275 (10th Cir. 1969) (same)
    with In re Hunter, 
    66 F.3d 1002
    , 1005-06 (9th Cir. 1995) (rejecting notion of
    ancillary jurisdiction in independent actions); United States v. Timmons, 
    672 F.2d 1373
    , 1378-79 (11th Cir. 1982) (same); and Andrade v. United States, 
    485 F.2d 660
    664 (Ct. Cl. 1973) (same), cert. denied, 
    419 U.S. 831
    95 S. Ct. 55
    42 L. Ed. 2d 57
    (1974). See also 11 Charles A. Wright, Arthur R. Miller & Mary K.
    Kane, Federal Practice & Procedure: Civil § 2868 at 403 (2d ed.
    1995) (supporting notion of ancillary jurisdiction, citing
    generally Pacific R. Co. v. Missouri Pac. Ry. Co., 
    111 U.S. 505
    4 S. Ct. 583
    28 L. Ed. 498
     (1884)); 7 James W. Moore, Moore’s
    Federal Practice ¶ 60.38[1], at 60-399 (2d ed. 1995) (same).
    precedential value in light of the Supreme Court’s holding in
    Kokkonen or in light of our prior cases, reflected most recently in
    Bankers Mortgage, in which we required that an independent action
    be        “founded   upon    an   independent   and   substantive   equitable
    jurisdiction.” 423 F.2d at 78.
              Moreover, to the extent that West Virginia Oil has any value
    as precedent, the case is inapposite here because it is on a
    completely different jurisdictional footing. West Virginia Oil was
    a case in which the parties could not review the judgment in
    federal court without ancillary jurisdiction.              Beggerly, on the
    other hand, could have pursued this suit under several different
    statutes conferring federal jurisdiction independent of that in the
    original action.            The federal courts would have had independent
    jurisdiction over a timely action under the Quiet Title Act, 28
    U.S.C. § 2409a; the Tucker Act, 28 U.S.C. § 1491; and probably
    general federal question jurisdiction under 28 U.S.C. § 1331
    (putting sovereign immunity to one side for the moment).              Because
    there is no need to assert ancillary jurisdiction to review the
    underlying settlement in federal court, West Virginia Oil is not on
    point, even to the extent that it was ever good law in the first
          Our West Virginia Oil opinion relies solely on an apparent misreading of
    Supreme Court precedent. In West Virginia Oil, the court confused the history
    of independent actions and the common law predecessors to the separate actions
    of Fed. R. Civ. P.
    60(b). Independent actions are distinct, and “should under no
    circumstances be confused with ancillary common law and equitable
    remedies, or their modern substitute, the 60(b) motion.” Bankers
    Mortgage, 423 F.2d at 78. The West Virginia Oil court simply cited
         My    concern   over   the   characterization      of     this   suit   as
    independent or ancillary is not as serious as my other concerns:
    waiver of sovereign immunity and the proper reach of the majority
         The United States is, of course, immune from suit without its
    consent, Loeffler v. Frank, 
    486 U.S. 549
    , 554, 
    108 S. Ct. 1965
    100 L. Ed. 2d 549
     (1988), and we are to construe waivers of
    sovereign immunity “strictly in favor of the sovereign.”                United
    States Dep't of Energy v. Ohio, 
    503 U.S. 607
    , 615, 
    112 S. Ct. 1627
    118 L. Ed. 2d 255
     (1992).          Beggerly can cite no statutory
    waiver of sovereign immunity in this case, either in the original
    action or in the independent action.           The majority bypasses the
    question   of   sovereign   immunity     by   holding   that   “governmental
    a Supreme Court case that found ancillary jurisdiction for the
    precursor to Rule 60(b) motions, and held that there was similar
    ancillary jurisdiction in independent actions.
         The West Virginia Oil court relied on Pacific Railroad of
    Missouri v. Missouri Pacific Railway Co., 
    111 U.S. 505
    , 522, 4 S.
    Ct. 583, 592, 
    28 L. Ed. 2d 498
     (1884), which involved a bill in
    equity to vacate a judgment on the basis of fraud. The bill in
    equity in that case was a bill of review (one of the forebears of
    Rule 60(b)), not an independent action in equity. Zegura, 104 F.2d
    at 35 (characterizing the bill in Pacific Railroad as a “bill of
    review”). Therefore Pacific Railroad has little or no precedential
    force for independent actions. A bill of review, like a Rule 60(b)
    motion, had to be brought in the court that rendered judgment and
    was essentially a request that the court reopen the judgment to
    reverse or correct a final decree. Wright, Miller & Kane, Federal
    Practice & Procedure: Civil § 2867 at 394. The unremarkable fact
    that a motion to reopen a judgment enjoys ancillary jurisdiction
    therefore should not disturb our precedents holding that
    independent actions in equity are founded upon an independent and
    substantive equitable jurisdiction. Bankers Mortgage, 423 F.2d at
    78. I agree with the Bankers Mortgage court, and apparently the
    Supreme Court in Kokkonen, that it is important not to confuse the
    two conceptually distinct avenues for review.
    consent is not required to bring an independent action in the same
    court as the original action[,]” citing the Second Circuit’s
    opinion in Weldon v. United States, 
    70 F.3d 1
    , 4 (2d Cir. 1995).
    Regardless of the equities of any individual case, governmental
    consent    is   always    required      as     a        prerequisite       to    federal
    jurisdiction.    Loeffler, 486 U.S. at 554.
         The Second Circuit’s opinion in Weldon is not to the contrary.
    Although the Second Circuit in Weldon agrees with the majority that
    independent actions are “continuations” of the original actions
    they challenge, the court does not claim that waiver of sovereign
    immunity is unnecessary.         In Weldon, the parties sued under the
    Federal Tort Claims Act in the original suit, which constituted a
    statutory waiver of sovereign immunity.                 70 F. 3d at 2.         The Weldon
    court held that, because the independent action was essentially a
    continuation of the original suit, the government’s waiver of
    sovereign immunity in the original action should continue to bind
    the United States in the subsequent challenge.                      Id.    Weldon does
    not suggest that waiver is unnecessary, only that it may be
    continued from the original suit.            So even if we were to find in
    the instant case that independent actions should be considered a
    continuation of the original actions they challenge (a point I
    still dispute),       there    would   still       be    no   waiver      of    sovereign
    immunity in the original action for us to continue.                       Of course, we
    cannot    equitably    waive    sovereign      immunity        on    behalf       of   the
    government; therefore we do not have jurisdiction to consider this
          My final concern is that the majority reaches issues not
    before us in this opinion.      Even if there were a waiver of
    sovereign immunity in this case, we would have no jurisdiction to
    reach the merits of Beggerly’s cross motion for summary judgment,
    the validity of the Boudreau grant, or the ownership of Horn
    Island, as the majority does.        These issues are fraught with
    difficult fact questions that must be decided by the district
    court, which alone has jurisdiction to consider them.    Moreover,
    the majority should not have reached those issues on the incomplete
    summary judgment record before us, but instead should have remanded
    them to the district court.   Therefore I respectfully dissent.
         Presumably a timely challenge to the original action under the
    Quiet Title Act or the Tucker Act, each of which involves a
    statutory waiver of immunity, would not suffer from this infirmity
    of the independent action in equity.