Summary of a Recent
Judicial Development in
Water Law

Reclamation Reform Act Did Not Waive Government's
Sovereign Immunity for Direct Initiation of a Suit

L. Paul Goeringer
National AgLaw Center Research Associate

Summary of Decision

In Orff v. United States, 545 U.S. 596 (2005), the United States Supreme Court held that Section 390uu of the Reclamation Reform Act of 1982, 43 U.S.C. § 390uu, did not waive the federal government's sovereign immunity. Section 390uu only grants consent to join the U.S. in actions between other parties when the U.S. is a necessary party, but does not allow for the U.S. to be named as the sole party.

Background

In 1963, the Bureau of Reclamation (Bureau) entered into a 40-year service contract to provide the Westlands Water District (District) with a specified annual quantity of water. Id. at 598-99. The Bureau, in 1992, imposed reductions stemming from the Central Valley Project Improvement Act to meet environmental obligations. Id. at 599. Because of these environmental obligations, the District's water was reduced by fifty percent. Id. The District sued the Bureau over the reductions, and the current landowners and water users intervened. Id. at 600. A settlement was eventually reached between all the parties, except for the landowners and water users. Id.

The District Court dismissed many of the landowners' claims, except for a breach of contract claim. Id. On reconsideration, the District Court found that the landowners "were neither contracting parties nor third-party beneficiaries of the 1963 contract" and could not benefit from the limited waiver of sovereign immunity. Id. The Ninth Circuit Court of Appeals affirmed the decision, but recognized a circuit split. Id. at 601. The Supreme Court granted certiorari. Id.

Arguments

The landowners argued that they were intended to be third-party beneficiaries to the 1963 contract and should be allowed to enforce its terms. Id. They asserted that because of their status as third-party beneficiaries, their claims fell within § 390uu, and should be allowed to proceed. Id. at 601-02.

The U.S. argued that the waiver was limited to joinder, and not to direct initiation of legal proceedings. Id. at 603. It asserted that this waiver did not permit the landowners to sue the U.S. alone, but allowed for the U.S. to be joined as a "necessary party." Id. at 602.

Analysis and Holdings

The Supreme Court held that waivers of sovereign immunity are to be strictly construed. Id. at 601-02. Section 390uu only grants consent for the U.S. to be joined as a necessary party defendant, and does not allow the initiation of a suit only against the U.S. Id. at 603. The Court compared the words "necessary party", found in § 390uu, to Federal Rules of Civil Procedure Rule 19(a) on joinder of necessary parties, and to the definition of "necessary parties" in Black's Law Dictionary. Id. 602-03. The court found that this comparison supported the interpretation of § 390uu that would only permit joinder of the U.S. in an action, and would not allow the U.S. to be named as the sole defendant. Id. at 603.

Finally, the Supreme Court looked at other federal statutes that provided broader phrasing of the waiver of sovereign immunity. Examining both Tucker Acts, the Court found that Congress used broader language when it intended the U.S. to be sued solely. Id. The use of the broader language showed that the Reclamation Reform Act only provided for limited waiver of sovereign immunity allowing joinder as a necessary party. Id. Because the landowners tried to sue the U.S. solely, rather than to join them, § 390uu did not grant such a waiver. Id. at 604. The Supreme Court affirmed the decision of the Ninth Circuit Court of Appeals. Id.

The case was decided on June 23, 2005.