Appeal from the United States Court of Federal Claims in Case No. 09-CV-046, Senior Judge Robert H. Hodges, Jr.
The opinion of the court was delivered by: Lourie, Circuit Judge.
Before NEWMAN, LOURIE, and MOORE, Circuit Judges.
Opinion for the court filed by Circuit Judge LOURIE.
Dissenting opinion filed by Circuit Judge NEWMAN.
The San Carlos Apache Tribe ("Tribe") appeals from a decision of the United States Court of Federal Claims, which dismissed the Tribe's monetary damages claim against the United States for an alleged breach of fiduciary duty relating to water rights in the Gila River. Because the Court of Federal Claims correctly granted the government's motion to dismiss the Tribe's claim for lack of jurisdiction, we affirm.
The San Carlos Apache Reservation borders the Gila River. Compl. at 1; see also In re the Gen. Adjudication of All Rights to Use Water in the Gila River Sys. & Source, 127 P.3d 882, 885 (Ariz. 2006) ("Gen. Adjudication"). The river flows in a westerly direction across Arizona through semi-arid and desert lands requiring irrigation for successful agricultural or horticultural use. Gen. Adjudication, 127 P.3d at 885 n.1. In 1925, in connection with a federal project to dam the Gila River and provide water to surrounding landowners, the United States filed a complaint on behalf of the Tribe and other parties in the United States District Court for the District of Arizona to obtain a declaration of water rights to the Gila River (the "Globe Equity Litigation"). See San Carlos Apache Tribe v. United States, No. 09-46, at 1 (Fed. Cl. Mar. 25, 2010) ("Op.").
In 1935, following ten years of litigation, the district court approved a settlement among the parties; the consent decree is known as the "Globe Equity Decree" ("Decree"). Id. The Decree grants the Tribe 6,000 acre-feet of water from the Gila River each irrigation season for irrigating 1,000 acres of land. Id.; Answering Br. Def.-Appellee at A36, 2010 WL 3758727 ("Appellee Br."). The Decree states that the parties have "concluded and settled all issues" pertaining to Gila River water rights. Op. at 1; see also Appellee Br. at A26. The Decree further states that the parties' settlement is "embodied in and confirmed and made effective by" the Decree, which "defin[es] and adjudicat[es] the claims and rights" of the parties. Appellee Br. at A26. In addition, the Decree states:
That each and all of the parties to whom rights to water are decreed in this cause (and the persons, estates, interests and ownerships represented by such thereof as are sued in a representative capacity herein), their assigns and successors in interest, servants, agents, attorneys and all persons claiming by, through or under them and their successors, are hereby forever enjoined and restrained from asserting or claiming-as against any of the parties herein, their assigns or successors, or their rights as decreed herein-any right, title or interest in or to the waters of the Gila River, or any thereof, except the rights specified, determined and allowed by this decree, and each and all thereof are hereby perpetually restrained and enjoined from diverting, taking or interfering in any way with the waters of the Gila River or any part thereof . . . .
The government filed another water rights claim on behalf of the Tribe in 1979. Op. at 2; see also Arizona v. San Carlos Apache Tribe, 463 U.S. 545, 558 (1983).
Eventually, this claim was consolidated with other parties' water rights claims in the Gila River general stream adjudication ("Arizona Adjudication") in Arizona state court. See Gen. Adjudication, 127 P.3d at 886. In 2001, certain parties to the Arizona Adjudication asserted that the Tribe's water rights claims were barred by the res judicata effect of the Decree. Id. In response, the Tribe argued that it is not bound by the Decree, because it was not in privity with the United States in the Globe Equity Litigation. Id. at 896. The Tribe also argued that, in the litigation leading to the Decree, the United States as trustee for the Tribe sought water rights only under the theory of prior appropriation; thus, the Decree does not cover the Tribe's aboriginal water rights or federal reserved ("Winters") water rights. Id. at 888; see also Winters v. United States, 207 U.S. 564, 576-77 (1908); A. Dan Carlock, Law of Water Rights and Resources § 9:39 (2010).
The matter was appealed to the Arizona Supreme Court, which in 2006 declined on the basis of comity to consider the Tribe's argument that the Decree is not binding on the Tribe. Gen. Adjudication, 127 P.3d at 901. In essence, the court held that the proper forum for challenging the interpretation and enforcement of the Decree was the United States District Court for the District of Arizona, not Arizona state court.*fn1 Id. at 900-01. The Arizona Supreme Court further held that the Decree resolved all of the Tribe's water rights, under all theories, and thus precludes any further claim by the Tribe to the waters of the Gila River. Id. at 895. The Arizona Supreme Court noted that it "express[ed] no opinion as to what other remedies, if any, might be available to the Tribe for the Government's allegedly inadequate representation." Id. at 901 n.21.
On January 23, 2009, the Tribe filed a complaint in the United States Court of Federal Claims for monetary damages. The Tribe alleged that "[t]he United States' inadequate representation and failure to secure and protect the [Tribe's] aboriginal and federal reserved water rights under the Decree for a permanent Tribal homeland constitutes a serious breach of fiduciary duty which it owed to the [Tribe]." Compl. at 4. The Tribe asserted that its claim against the United States for monetary damages did not become ripe until the 2006 decision of the Arizona Supreme Court. Id. at 18.
The government filed a motion to dismiss for lack of jurisdiction, arguing, inter alia, that the Tribe's claim is barred by the six-year statute of limitations set forth in 28 U.S.C. § 2501. Def.'s Mot. to Dismiss at 1. The Court of Federal Claims granted the government's motion to dismiss. Op. at 3. The court held that the Tribe's claim against the government accrued in 1935 upon entry of the Decree and that it was therefore barred by the six-year statute of limitations. Id.
The Tribe timely appealed from the court's decision to dismiss its claim. We have jurisdiction over final judgments of the Court of Federal Claims pursuant to 28 U.S.C. § 1295(a)(3).
The statute of limitations provided by 28 U.S.C. § 2501 is jurisdictional in the Court of Federal Claims.
Sand & Gravel Co. v. United States, 552 U.S. 130, 134 (2008); Hopland Band of Pomo Indians v. United States, 855 F.2d 1573, 1576-77 (Fed. Cir. 1988) ("The 6-year statute of limitations on actions against the United States is a jurisdictional requirement attached by Congress as a condition of the government's waiver of sovereign immunity and, as such, must be strictly construed."). Whether the Court of Federal Claims possesses jurisdiction over a claim is a question of law subject to de novo review. Western Co. v. United States, 323 F.3d 1024, 1029 (Fed. Cir. 2003). In reviewing the propriety of the court's dismissal, we accept as true the facts alleged in the Tribe's complaint. Catawba Indian Tribe v. United States, 982 F.2d 1564, 1568-69 (Fed. Cir. 1993).
An action brought under the Tucker Act is time-barred unless it is "filed within six years of the date that the cause of action accrued." Fallini v. United States, 56 F.3d 1378, 1380 (Fed. Cir. 1995); see also 28 U.S.C. § 2501 (2006) ("Every claim of which the United States Court of Federal Claims has jurisdiction shall be barred unless the petition thereon is filed within six years after such claim first accrues."). A cause of action against the government has first accrued "when all the events which fix the government's alleged liability have occurred and the plaintiff was or should have been aware of their existence." Hopland Band, 855 F.2d at 1577 (emphasis omitted). Moreover, "[t]he question whether the pertinent events have occurred is determined under an objective standard; a plaintiff does not have to possess actual knowledge of all the relevant facts in order for the cause of action to accrue." Fallini, 56 F.3d at 1380. This objective standard applies to the accrual of a claim for breach of fiduciary duty. See Jones v. United States, 801 F.2d 1334, 1335 (Fed. Cir. 1986) ("Generally, an action for breach of fiduciary duty accrues when the trust beneficiary knew or should have known of the breach.").
On appeal, the Tribe argues that the Court of Federal Claims erred by dismissing its claim. The Tribe asserts that its claim against the government accrued in 2006 following the decision of the Arizona Supreme Court, and is therefore within the six-year statute of limitations under 28 U.S.C. § 2501. The Tribe contends that, due to the government's legally inadequate representation of the Tribe in the Globe Equity Litigation, it was not clear until 2006 that the Tribe was in fact bound by the Decree.
The Tribe also argues that the scope of the Decree remained unclear until the Arizona Supreme Court held that the Decree precluded any claims by the Tribe for additional water rights from the Gila River. The Tribe points out that the United States, as trustee for the Tribe, continued to support the Tribe's claims for additional water rights until 2006, and the Tribe contends that it had no notice that the Decree precluded additional water rights. The Tribe thus argues that, as a beneficiary, it was entitled to rely on the government's good faith and expertise without having to sue for money damages prior to the 2006 Decision. Further, the Tribe argues that because the government did not repudiate its role as the Tribe's trustee until 2006, the Tribe's claim for breach of fiduciary duty did not begin to accrue until then.
The government argues that the Tribe's claim is untimely and barred by the statute of limitations. The government contends that a claim against a trustee for breach of trust accrues when the beneficiary objectively knew or should have known of the breach. The government points out that the basis of the Tribe's present claim is the plain language of the Decree itself, demonstrating that the Tribe's claim was "inherently knowable" to the Tribe in 1935. Appellee Br. at 11. The government further argues that the decision of the Arizona Supreme Court in 2006 did not fix the basis of the Tribe's claim; at most, the decision clarified the possible damages associated with the claim. Therefore, the government argues, the Arizona Supreme Court's decision did not affect whether the Tribe knew or should have known that its claim existed.
We agree with the government that the Court of Federal Claims lacked jurisdiction over this case because the Tribe's claim is barred by the statute of limitations. The Tribe's complaint asserts jurisdiction pursuant to the Tucker Act, 28 U.S.C. § 1491(a)(1). As noted above, an action brought under the Tucker Act is time-barred unless it is filed within six years of the date that the cause of action accrued. The central question in this case is when the Tribe's claim for breach of fiduciary duty accrued. We conclude that the Tribe's claim accrued in 1935 upon entry of the Decree. As we shall explain, our conclusion is compelled by the plain terms of the Decree and is consistent with the Tribe's own concessions in its complaint and appellate brief.
It is objectively evident that all of the events that fixed the government's alleged liability and entitled the Tribe to institute an action against the government occurred upon entry of the Decree in 1935. The Tribe's claim is based on the unsatisfactory water rights to which the government stipulated in the Decree. Specifically, the Tribe asserts that it was inadequately represented because the United States failed to obtain aboriginal or federal reserved water rights. Compl. at 18-19. However, the terms of the Decree plainly and objectively indicate which water rights the Tribe did and, importantly, did not receive following the settlement of the Globe Equity Litigation. The Decree does not expressly grant any aboriginal or federal reserved water rights to the Tribe, and, as the Tribe acknowledges, the Decree plainly identifies the Tribe as represented by the United States in the Globe Equity Litigation, grants the Tribe a total of 6,000 acre feet of water rights, and includes a provision in Article XIII stating that "each and all of the parties to whom rights to water are decreed in this cause . . . are hereby forever enjoined and restrained from asserting or claiming . . . any right, title or interest in or to the waters of the Gila River, or any thereof, except the rights specified, determined and allowed by this decree." Appellee Br. at A51. Accordingly, viewed under an "objective standard," Fallini, 56 F.3d at 1380, the Tribe knew or should have known that the terms of the Decree precluded the Tribe from seeking additional Gila River water rights.
The Tribe further contends that the government's inadequate representation and its resulting breach of fiduciary duty arose from a "severe conflict of interest" due to the government's representation of multiple parties in the Globe Equity Litigation. Compl. at 15. The facts supporting the alleged conflict of interest, however, were similarly apparent from the text of the Decree, which, viewed objectively, plainly indicated that the United States represented multiple parties in the Globe Equity Litigation. As of 1935, therefore, the Tribe was objectively on notice of the accrual of its claims against the government.*fn2
It is also evident from the Tribe's complaint and appellate brief that the basis for its claim in this case is the language of the Decree itself. For example, the Tribe's complaint acknowledges that the government's alleged breach of fiduciary duty was apparent from the ...