Austin et al v. United States Department of Agriculture, Rural Development

Filing 13

MEMORANDUM AND ORDER re: 6 MOTION to Dismiss for Lack of Jurisdiction filed by Defendant United States Department of Agriculture, Rural Development, 12 MOTION to Change Venue filed by Plaintiff Penelope Burris, Plaintiff Phyllis Austin: IT IS HEREBY ORDERED that defendant's motion to dismiss (#6) is DENIED and plaintiffs' motion to transfer (#12) is GRANTED. IT IS FURTHER ORDERED that the Clerk shall transfer this case to the Court of Federal Claims., Terminate Case. Signed by District Judge Stephen N. Limbaugh, Jr on 3/15/2013. (JMC)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
SOUTHEASTERN DIVISION

PHYLLIS AUSTIN and
PENELOPE BURRIS,
Plaintiffs,
vs.
U.S.D.A., RURAL HOUSING SERVICE,
Defendant.

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Case No. 1:12-cv-137 SNLJ

MEMORANDUM AND ORDER
Plaintiffs Phyllis Austin and Penelope Burris brought this action against defendant Rural
Housing Service, an agency of the United States Department of Agriculture, in the Circuit Court
of Ripley County, Missouri. Defendant removed this case to this Court pursuant to 28 U.S.C. §§
1446(a) & 1442(a)(1) on August 6, 2012 (#1). Subsequently, plaintiffs’ attorney, Paul Kidwell,
advised plaintiffs and this Court that he would not represent them in federal court, so plaintiffs
are proceeding pro se. On November 6, 2012, defendant filed a motion to dismiss for lack of
subject matter jurisdiction (#6), arguing that the Tucker Act and Little Tucker Act, 28 U.S.C. §
1491(a) & § 1346(a)(2), respectively, apply to vest exclusive subject matter jurisdiction over this
claim with the Court of Federal Claims. On December 13, 2012, plaintiffs filed a “Motion to
Change Venue” and requested that this Court transfer the case to the Court of Federal Claims
(#12).
In summary, plaintiffs claim that defendant made a loan to them for construction of a
home in Doniphan, Missouri. Plaintiffs contracted with BARCO Construction to build the new
home, but BARCO did not perform as promised and ultimately abandoned the job. Plaintiffs
allege that defendant exacerbated the damages already done to them by BARCO in a number of

ways. Plaintiffs thus claim breach of contract against defendant and claim damages in excess of
$25,000.
Defendant filed its motion pursuant to Federal Rule of Civil Procedure 12(b)(1). The
function of a Rule 12(b)(1) motion is to allow the court to address the threshold question of
jurisdiction, as “judicial economy demands that the issue be decided at the outset rather than
deferring it until trial.” United States v. Osborn, 918 F.2d 724, 729 (8th Cir. 1990). Defendant
asserts that, because plaintiffs’ complaint sounds in contract and seeks more than $10,000 in
damages, this Court lacks subject matter jurisdiction pursuant to the Tucker Act, 28 U.S.C. §
1491(a). That statute provides:
The United States Court of Federal Claims shall have jurisdiction to render
judgment upon any claim against the United States founded either upon the
Constitution, or any Act of Congress or any regulation of an executive
department, or upon any express or implied contract with the United States, or for
liquidated or unliquidated damages in cases not sounding in tort.
28 U.S.C. § 1491(a). The companion Little Tucker Act, 28 U.S.C. § 1346(a)(2), provides
that the “district courts shall have original jurisdiction, concurrent with the United States
Claims Court [United States Court of Federal Claims], of . . . [a]ny other civil action
or claim against the United States, not exceeding $10,000 in amount, founded . . . upon
any express or implied contract with the United States.”
Indeed, the two statutes, taken together, provide that the United States’ sovereign
immunity is waived for contract actions, but exclusive jurisdiction of all such suits in
excess of $10,000 is vested with the Court of Federal Claims. V S Ltd. P’ship v. Dept. of
Housing and Urban Dev., 235 F.3d 1109, 1112 (8th Cir. 2000). Defendant then urges the
Court to dismiss this action for want of subject matter jurisdiction.

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Plaintiffs agree that the Tucker Act controls and that the Court of Federal Claims
has jurisdiction, but plaintiffs urge the Court to transfer the case to the Court of Federal
Claims. “District courts shall, ‘in the interest of justice,’ transfer actions over which they
lack jurisdiction to any court in which the action could have originally been brought.” V
S Ltd. P’ship, 235 F.3d at 1113 (citing 28 U.S.C. § 1631). Plaintiffs state that it would be
in the interest of justice to transfer the case because they have not had the opportunity to
be heard. Notably, the defendant did not respond in any way to plaintiffs’ motion. The
Eighth Circuit has “in the past directed transfer when a plaintiff in good faith filed in the
wrong court and the statute of limitations would have run before he could refile
properly.” Gunn v. U.S. Dept. of Agric., 118 F.3d 1233, 1240 (8th Cir. 1997). Here, it is
unclear when the statute of limitations would run, but it appears that equity favors transfer
rather than dismissal. See, e.g., Carter v. United States, 4:02CV01256 ERW, 2003 WL
24472515 (E.D. Mo. Apr. 25, 2003). With plaintiffs having been abandoned by their
attorney, the Court finds that justice will be better served by transferring the case,
particularly in light of defendant’s failure to object.
Accordingly,
IT IS HEREBY ORDERED that defendant’s motion to dismiss (#6) is DENIED
and plaintiffs’ motion to transfer (#12) is GRANTED.
IT IS FURTHER ORDERED that the Clerk shall transfer this case to the Court
of Federal Claims.
Dated this

15th day of March, 2013.
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STEPHEN N. LIMBAUGH, JR.
UNITED STATES DISTRICT JUDGE

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