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Morton v. Ruiz

No. 72-1052

Argued November 5, 1973

Decided February 20, 1974

415 U.S. 199

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

Syllabus

Respondent Ruiz and his wife, Papago Indians, left their reservation in Arizona in 1940 to live in an Indian community a few miles away, and Ruiz found employment at a nearby mine. During a prolonged strike, Ruiz applied for but was denied general assistance benefits under the Snyder Act by the Bureau of Indian Affairs (BIA) because of a provision in the BIA Manual limiting eligibility to Indians living "on reservations" (and in jurisdictions under the BIA in Alaska and Oklahoma). After unsuccessful administrative appeals, respondents instituted this purported class action, claiming, inter alia, entitlement to such general assistance as a matter of statutory interpretation. The District Court's summary judgment for petitioner was reversed by the Court of Appeals on the ground that the Manual's residency limitation was inconsistent with the broad language of the Snyder Act, that Congress intended general assistance benefits to be available to all Indians, including those in respondents' position, and that Congress' subsequent actions in appropriating funds for the BIA general assistance program did not serve to ratify the imposed limitation.

Held:

1. Congress did not intend to exclude from the BIA general assistance program these respondents, and their class, who are full-blooded, unassimilated Indians living in an Indian community near their native reservation and who maintain close economic and social ties with that reservation. Pp. 212-230.

(a) The legislative history of the subcommittee hearings regarding appropriations under the Snyder Act showing that the BIA's usual practice has been to represent to Congress that "on or near" reservations is the equivalent of "on" for purposes of welfare service eligibility, and that successive budget requests were for Indians living "on or near," and not just for those living directly "on," clearly shows that Congress was led to believe that [415 U.S. 200] the programs were being made available to those nonassimilated Indians living near the reservation as well as to those living "on," and a fair reading of such history can lead only to the conclusion that Indians situated near the reservation, such as respondents, were covered by the authorization. Pp. 213-229.

(b) The fact that Congress made appropriations during the time the "on reservations" limitation appeared in the BIA Manual does not mean that Congress implicitly ratified the BIA policy, where such limitation had not been published in the Federal Register or in the Code of Federal Regulations, and there is nothing in the legislative history to show that the limitation was brought to the appropriation subcommittees' attention, let alone to the entire Congress. But, even assuming that Congress knew of the limitation when making appropriations, there is no reason to assume that it did not equate the "on reservations" language with the "on or near" category that continuously was described as the service area. P. 230.

2. Assuming, arguendo, that the Secretary rationally could limit the "on or near" appropriation to include only Indians who lived directly "on" the reservation (plus those in Alaska and Oklahoma), this has not been validly accomplished. Pp. 230-238.

(a) By not publishing its general assistance eligibility requirement in the Federal Register or in the Code of Federal Regulations, the BIA has failed to comply with the requirements of the Administrative Procedure Act (APA) as to publication of substantive policies. The Secretary's conscious choice not to treat this extremely significant requirement as a legislative type rule, renders it ineffective so far as extinguishing the rights of those otherwise within the class of beneficiaries contemplated by Congress. Pp. 232-236.

(b) Moreover, the BIA has failed to comply with its own internal procedures, since the "on reservations" limitation is clearly an important substantive policy within the class of directives -- those that "inform the public of privileges and benefits available" and of "eligibility requirements" -- that the BIA Manual declares are among those to be published. P. 235.

(c) Even assuming the lack of binding effect of the BIA policy, it is too late to argue that the words "on reservations" in the BIA Manual mean something different from "on or near," and therefore are entitled to deference as an administrative interpretation [415 U.S. 201] when in fact, the two have been continuously equated by the BIA to Congress. Pp. 236-237.

462 F.2d 818, affirmed and remanded.

BLACKMUN, J., delivered the opinion for a unanimous Court.

Key excerpt of majority opinion by Justice Blackmun:

The power of an administrative agency to administer a congressionally created and funded program necessarily requires the formulation of policy and the making of rules to fill any gap left, implicitly or explicitly, by Congress. In the area of Indian affairs, the Executive has long been empowered to promulgate rules and policies,{25} and the power has been given explicitly to the Secretary and his delegates at the BIA.{26} [415 U.S. 232] This agency power to make rules that affect substantial individual rights and obligations carries with it the responsibility not only to remain consistent with the governing legislation, FMC v. Seatrain Lines, Inc., 411 U.S. 726 (1973); Dixon v. United States, 381 U.S. 68, 74 (1965); Brannan v. Stark, 342 U.S. 451 (1952), but also to employ procedures that conform to the law. See NLRB v. Wyman-Gordon Co., 394 U.S. 759, 764 (1969) (plurality opinion). No matter how rational or consistent with congressional intent a particular decision might be, the determination of eligibility cannot be made on an ad hoc basis by the dispenser of the funds.

The Administrative Procedure Act was adopted to provide, inter alia, that administrative policies affecting individual rights and obligations be promulgated pursuant to certain stated procedures so as to avoid the inherently arbitrary nature of unpublished ad hoc determinations. See generally S.Rep. No. 752, 79th Cong., 1st Sess., 12-13 (1945); H.R.Rep. No.1980, 79th Cong., 2d Sess., 21-23 (1946). That Act states in pertinent part:

Each Agency shall separately state and currently publish in the Federal Register for the guidance of the public --

* * * *

(D) substantive rules of general applicability adopted as authorized by law, and statements of general policy or interpretations of general applicability [415 U.S. 233] formulated and adopted by the agency.

5 U.S.C. § 552(a)(1). The sanction added in 1967 by Pub.L. 90-23, 81 Stat. 54, provides:

Except to the extent that a person has actual and timely notice of the terms thereof, a person may not in any manner be required to resort to, or be adversely affected by, a matter required to be published in the Federal Register and not so published.

…

Where the rights of individuals are affected, it is incumbent upon agencies to follow their own procedures. This is so even where the internal procedures are possibly more rigorous than otherwise would be required.