Summary of a Recent
Judicial Development in
Administrative Law

Failure to Control Weeds Causes Reduction
in Farm Program Payment

Harrison M. Pittman
Staff Attorney

Summary of Decision

In Bishop v. Veneman, 283 F.Supp.2d 1207 (D. Kan. 2003), the United States District Court for the District of Kansas affirmed a National Appeals Division determination that a farmer's production flexibility contract payments were properly reduced as a result of the farmer's failure to control weeds.

Background

Plaintiff Barbara Bishop owned two-thirds of a property, along with her nephew who owned one-third of the property, that was subject to a Production Flexibility Contract (PFC). See id. at 1209. Under the PFC, the United States Department of Agriculture made annual payments over a seven- year period to producers in exchange for their agreement to "protect the land from weeds and erosion in the event that . . . [they choose] not to plant a crop on the land." Id. (citation omitted). The PFC payment terms required that producers' payment rates be reduced if these maintenance requirements were not satisfied. See id. (citation omitted).

In 1997, Bishop received a letter from her local Farm Service Agency (FSA) office notifying her that weeds on a portion of her property that had not been planted were not being properly controlled and that her PFC payments would be reduced if the problem was not corrected within 15 days. See id. at 1209-10. The problem had already been corrected at the time the letter was received, and no reduction was made in her PFC payments. See id. at 1210. In 2001, Bishop received another letter from her local FSA office that notified her that weeds on a portion of her land were not being controlled. See id. The second letter stated that

This letter is to notify you that a second violation has occurred whereby weeds are again not being controlled to prevent weed seed production . . . . [T]he County Committee has determined that a payment reduction of $11,448 will be assessed against your share of Farm # 2557 for this subsequent violation. Furthermore, you will have (15) calendar days . . . to remedy this problem to avoid further payments reductions. . . .

Id. (citation omitted).

Bishop appealed the FSA's decision to the Kansas State FSA Committee. See id. The Committee affirmed the determination that the plaintiff violated the PFC payment terms by failing to control weeds. See id. at 1210-11. It also determined that Bishop's payments should have been reduced by $14,906.00, rather than $11,448,00. See id. at 1211. Bishop appealed the Committee's decision to the National Appeals Division (NAD); the NAD hearing officer affirmed the Committee's determination. See id. After unsuccessfully appealing the NAD hearing officer's determination to the NAD Director, Bishop appealed to the district court "seeking judicial review of the Director's final order that she had failed to control weeds, that she had thereby violated the contract, and that her payments pursuant to the PFC should thus be reduced by $14,906 for 2001." Id.

Arguments

Bishop raised five main arguments on appeal. First, she argued that the PFC contracts were void for vagueness because the regulations did not define the terms "weeds" or specify how weeds should be controlled. See id. at 1212, 1213. Second, Bishop argued that enforcement of the PFC term requiring payment reduction was discriminatory and was the product of a selective prosecution that resulted from her reporting of a violation committed by a member of the local FSA office. See id. at 1213. Third, she argued that the payment reduction was not a reasonable damages provision, but rather it was an unenforceable penalty provision. See id. Fourth, she argued that "the 2001 violation was her first violation and that therefore she was entitled to a warning [letter], rather than a payment reduction." Id. Fifth, Bishop argued that the 2001 violation was her first violation because her PFC payment was not reduced in 1997, an FSA agent who inspected her farm concluded that "'this farm is not in violation,'" and because she had already controlled the weeds when she received the 1997 letter. Id. at 1215.

Analysis and Holdings

The court rejected Bishop's first argument because it was not within the court's scope of review. See id. at 1213. Recognizing that the void for vagueness doctrine raises a constitutional challenge, the court stated that "[i]t is generally considered that the constitutionality of Congressional enactments is beyond the jurisdiction of administrative agencies." Id. (citations omitted). It further held that NAD procedures cannot be used "to challenge a statute or regulation as void for vagueness. Because . . . this case is on appeal from the decision of NAD, the court's scope of review is narrow . . . . Any determination that the statute is void for vagueness is beyond this court's review of . . . [the agency action]." Id. (citation omitted).

The court rejected Bishop's second argument, holding that it was also beyond its scope of review of agency action. See id. The court noted the NAD hearing officer's determination that allegations of discrimination are not within the hearing officer's authority and held that "issues of retaliation and discrimination were not . . . properly before the agency, and they are thus . . . beyond this court's scope of review on appeal." Id. (citations omitted).

The court also rejected Bishop's argument that the payment reduction was an unenforceable penalty provision. See id. The court stated that the PFC agreement that Bishop signed clearly stated that if she did not comply with its terms, her PFC payments would be reduced. See id. at 1214. It held that "[b]ecause plaintiff failed to abide by her agreement to control weeds on contract acreage, the payments she otherwise would have received were properly reduced, in accordance with the terms of her contract and the law." Id.

Turning to Bishop's contention that she was entitled to a warning, the court explained that although the PFC regulations do not require a warning letter, the PFC contract states that "[a]ll producers sharing in PFC payments are entitled to 1 warning letter for the first default on each farm during the term of the contract." Id. Noting that the 1997 letter related to farm serial number (FSN) 2129 and the 2001 letter related to FSN 2557, the court stated that FSN 1777 "was reconstituted into FSN 2129, and subsequently into FSN 2557." Id. (citation omitted). The court held that there was "substantial evidence supporting the agency finding that both the 1997 and 2001 violations related to only one contract. The fact that a farm is reconstituted . . . does not change the nature of the agreement under the PFC contract." Id.

In rejecting Bishop's fifth argument, the court noted the NAD hearing officer's determination that the regulations governing this matter "do not provide for a warning letter to be issued" and "clearly set forth that the first violation by a producer will result in a reduction in the producer's payment for the farm . . . ." Id. at 1215. Consequently, the court concluded that "[t]he record provides ample support for the factual finding that weeds were uncontrolled on the stated number of contract acres farmed by plaintiff in 1997. This alone is sufficient to constitute a violation." Id.

The case was decided on August 14, 2003; this summary was posted Mar. 17, 2004.