Hahnenkamm, LLC v. United States
17-855
| Fed. Cl. | Dec 7, 2017Background
- Hahnenkamm, LLC owned a 39.25-acre parcel (“Cave Rock Summit”) in Douglas County, Nevada and sought to develop it; negotiations with the U.S. Forest Service culminated in an Option Agreement granting the Forest Service a 24-month option to buy the parcel.
- The Forest Service engaged an appraiser (Doré Group) whose appraisal valued the property at $5.03 million; Hahnenkamm disputed the appraisal as flawed and contends it omitted access, entitlements, and transferable development rights.
- After unsuccessful price negotiations, Hahnenkamm granted the option on June 28, 2015; the Forest Service exercised the option on July 7, 2015 and purchased the parcel for $5.03 million.
- Hahnenkamm sued in the Court of Federal Claims alleging breach of contract (Option Agreement required an appraisal conforming to federal appraisal standards and payment of FMV) and statutory violations of the Santini-Burton Act and the Southern Nevada Public Land Management Act (both require independent/standards-compliant appraisal and fair market valuation).
- The government moved to dismiss for lack of Tucker Act jurisdiction (statutes not money-mandating) and for failure to state a breach-of-contract claim; the court denied dismissal on both jurisdictional and merits-pleading grounds.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Santini-Burton is money-mandating | Santini-Burton requires fair market value and independent appraisal; failure to follow appraisal/statutory process entitles landowner to compensation | "Shall determine" for unimproved land does not obligate government to pay FMV; statute not money-mandating for unimproved land | Court: Statute can be fairly read as imposing limits whose breach is money-mandating; plaintiff alleged facts sufficient to state a money-mandating claim |
| Whether Southern Nevada Land Act is money-mandating | Incorporates FLPMA appraisal requirements/standards; failure to obtain compliant appraisal and arbitrate valuation dispute entitles owner to compensation | Statute only prescribes appraisal procedures; does not require payment of FMV | Court: Appraisal provisions can be interpreted to mandate determination of FMV and a failure to follow them can be money-mandating; jurisdiction exists |
| Whether Option Agreement imposed duty to obtain standards-compliant appraisal and pay FMV | Option Agreement (Form FS-5400-36) requires appraisal conforming to Uniform Appraisal Standards for Federal Land Acquisitions and non-merger/survival clauses; alleged breach caused damages | Contract fix-priced purchase term ($5,030,000) supersedes statutory/appraisal obligations; no contractual duty to pay FMV | Court: Accepting plaintiff’s factual allegations, the complaint pleads the elements of a breach-of-contract claim and survives 12(b)(6) dismissal |
| Whether plaintiff stated plausible claims under Twombly/Iqbal | Allegations identify statutory duties, contractual appraisal clause, procedural irregularities in appraisal, and damages (difference from alleged FMV) | Government contends allegations insufficient or foreclosed by contract terms | Court: Pleadings are sufficient and plausible; dismissal denied |
Key Cases Cited
- United States v. Mitchell, 463 U.S. 206 (statutory waiver of sovereign immunity does not by itself create substantive right to money damages)
- United States v. Testan, 424 U.S. 392 (Tucker Act requires separate money-mandating source of law)
- Fisher v. United States, 402 F.3d 1167 (plaintiff must identify substantive, money-mandating law to confer Tucker Act jurisdiction)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (pleading must be plausible to survive Rule 12(b)(6))
- Ashcroft v. Iqbal, 556 U.S. 662 (courts accept factual allegations as true and assess plausibility)
- United States v. Ron Pair Enterprises, Inc., 489 U.S. 235 (statutory interpretation: enforce plain meaning)