Unpublished Disposition, 848 F.2d 198 (9th Cir. 1983)

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U.S. Court of Appeals for the Ninth Circuit - 848 F.2d 198 (9th Cir. 1983)

Clinton W. LOVE and Rose Mary Love, husband and wife,Plaintiff-Appellant,v.UNITED STATES of America; United States Department ofAgriculture; Farmers Home Administration,Defendant-Appellee.

No. 86-4415.

United States Court of Appeals, Ninth Circuit.

Submitted March 21, 1988.* Decided May 24, 1988.

Before NELSON, NOONAN and LEAVY, Circuit Judges.



Clinton and Rose Mary Love appeal from the district court's order dismissing their complaint against the United States1  for failure to state a claim. The Loves contend that their complaint states a claim under the Federal Tort Claims Act (FTCA) for an alleged violation of a federal regulation requiring the Farmers Home Administration (FHA) to pay the Loves' delinquent water assessments. The district court's order is affirmed.


At the times pertinent to this action, the Loves operated a farm in Montana and obtained water from the Harlem Irrigation District. On May 25, 1983, the Harlem Irrigation District terminated delivery of water to the Loves' property because the Loves were two years delinquent in the payment of their annual water assessments. The Loves were therefore without water throughout the 1983 growing season. Their complaint alleged that the FHA had an obligation, imposed by federal administrative regulations (7 C.F.R. Sec. 1863.4(a)), to pay the Loves' delinquent water assessments.


This court reviews de novo the district court's dismissal of a complaint for failure to state a claim upon which relief can be granted. Western Reserve Oil & Gas Co. v. New, 765 F.2d 1428, 1430 (9th Cir. 1985), cert. denied, 474 U.S. 1056 (1986). The FTCA waives, with certain exceptions, the government's traditional sovereign immunity from tort claims. 28 U.S.C. § 2674. A finding of liability under the FTCA must be based upon state law. 28 U.S.C. § 1346(b); Carlson v. Green, 446 U.S. 14, 23 (1980). Thus, the violation of a federal statute or administrative regulation by a United States agency does not, standing alone, create a cause of action under the FTCA. A federal statute or regulation only becomes relevant when a state law duty is found to exist; the federal statute or regulation may then provide the standard for reasonable care in exercising the state law duty. Lutz v. United States, 685 F.2d 1178, 1184 (9th Cir. 1982).

Here, the Loves base their claim upon a federal regulation that allegedly requires the FHA to pay the Loves' delinquent water assessments. See 7 C.F.R. Sec. 1863.4(a).2  They contend that because Montana law recognizes a general duty of good faith and fair dealing, this regulation should, under the reasoning of Lutz, be relied upon to provide the standard for reasonable care in exercising that duty. See First National Bank v. Twombly, --- Mont. ----, 689 P.2d 1226, 1230 (1984) (recognizing bank's duty to act in good faith towards borrowers); First Security Bank v. Goddard, 181 Mont. 407, 593 P.2d 1040, 1047 (1979) (insurer's duty of good faith and fair dealing); Thompson v. State Farm Mut. Auto. Ins. Co., 161 Mont. 207, 505 P.2d 423, 429-30 (1973) (same); see also Mont.Code Ann. Sec. 28-1-201 (general duty not to injure or infringe rights of another). No Montana authority, however, indicates that the duty to act in good faith imposes an obligation upon private defendants analogous to the obligation imposed upon the FHA by the administrative regulation to pay certain delinquent water assessments of borrowers. See United Scottish Ins. Co. v. United States, 614 F.2d 188, 197 n. 9 (9th Cir. 1979) (no government liability where "a private person could not be held liable under similar circumstances"); cf. Lutz, 685 F.2d at 1184 (liability found where private citizen comparably situated would also be subject to duty). Because Montana law imposes no analogous liability upon private defendants for failure to pay a borrower's delinquent taxes, the district court did not err in finding that the federal regulation did not impose upon the FHA a duty to the Loves to pay the water assessments.3 

The district court's order is affirmed.


The panel unanimously finds this case suitable for submission on the record and briefs and without oral argument. Fed. R. App. P. 34(a), Ninth Circuit Rule 34-4


This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3


The complaint named as defendants the United States Department of Agriculture and the Farmers Home Administration. Although the Loves contend the United States was subsequently substituted as the defendant, the record does not reflect that the complaint was ever amended. The defendants, however, have conceded that the United States is the proper defendant and have not raised this as an issue on appeal


7 C.F.R. Sec. 1863.4(a) provides in relevant part:

(a) Prior (usually about 90 days) to the time it is legally possible for action to be taken that will cause the borrower to lose title or right of possession of the security property, or the use of essential water, the [FmHA] County Supervisor will contact the borrower and definitely determine if he will pay the delinquent tax immediately. If the borrower is unable or unwilling to pay the delinquent tax with his own funds after every appropriate effort has been made to have him do so, the County Supervisor will prepare and process Standard Form 1034, "Public Voucher for Purchases and Services Other Than Personal," to cover the amount of the delinquent taxes plus the amount of any accrued penalty.


The defendants further contend that even if the federal regulation were found to impose a duty upon the FHA to pay the Loves' delinquent water assessments, the defendants' conduct under the regulation would nevertheless be protected by the discretionary function exception to the FTCA. We need not decide that issue, because the lack of a duty imposed upon the FHA by Montana law is dispositive of the Loves' appeal