United States v. Detroit International Bridge Company, Walter H. Lubienski and Commodities Export Company, Proposed Intervenors-Appellants

MERRITT, Chief Judge,

concurring.

I concur in the court’s opinion but write separately in order to reinforce the court’s conclusion with additional considerations. Essentially, the court below held that Com *504 modities and Lubienski do not have a sufficient interest in the outcome of the case to justify intervention. This is a question of standing, 1 and the district court relies heavily on standing cases in reaching its decision. The court places primary reliance upon United States v. 36.96 Acres of Land, 754 F.2d 855 (7th Cir.1985), which held that “[t]he interest of a proposed intervenor ... must be greater than the interest sufficient to satisfy the standing requirement.” Id. at 859 . The district court also cites New Orleans Public Service, Inc. v. United Gas Pipe Line Co., 732 F.2d 452 (5th Cir.1984), cert. denied, 469 U.S. 1019 , 105 S.Ct. 434 , 83 L.Ed.2d 360 (1984) (“a party has no standing to assert a right if it is not his own”). The court’s unstated reliance on the standing doctrine is mistaken in two respects. First, the Sixth Circuit does not require an applicant for intervention to have standing to sue. Second, if the district court had properly determined the scope of the lawsuit, it would have held that Commodities and Lubienski do have standing.

The Supreme Court has not decided whether a party seeking intervention under Rule 24 must establish Article III standing, and the courts of appeals have reached different conclusions. See Diamond v. Charles, 476 U.S. 54, 68-69, n. 21 , 106 S.Ct. 1697, 1706-1707, n. 21 , 90 L.Ed.2d 48 (1986). The Seventh Circuit has held that in a condemnation suit an applicant for intervention must establish an interest greater than that necessary for standing. 36.96 Acres of Land, 754 F.2d 855 . The district court relies heavily upon 36.96 Acres of Land in reaching its decision that Commodities and Lubienski do not have a legal interest sufficient to warrant intervention. The Sixth Circuit does not, however, follow 36.96 Acres of Land. This court has held that “a party seeking to intervene need not possess the standing necessary to initiate a lawsuit.” Purnell v. City of Akron, 925 F.2d 941, 948 (6th Cir.1991). Although Purnell involved applicants whose standing was conditioned upon their ability to establish paternity, the court relied upon cases not involving contingent standing: Trbovich v. United Mine Workers, 404 U.S. 528, 536 , 92 S.Ct. 630, 635 , 30 L.Ed.2d 686 (1972) (“Intervention by union members in a pending enforcement suit, unlike initiation of a separate suit, subjects the union to relatively little additional burden.”) (citing with approval Shapiro, Some Thoughts on Intervention Before Courts, Agencies, and Arbitrators, 81 Harv.L.Rev. 721, 726 (1968) (“the case or controversy limitation should impose no barrier to [an applicant for intervention’s] admission”)), and United States Postal Service v. Brennan, 579 F.2d 188, 190 (2d Cir.1978) (“there was no need to impose the standing requirement upon the proposed in-tervenor”).

Even if standing to bring suit were required, the district court’s characterization of Commodities and Lubienski’s motion to intervene as an attempt to interfere with the government’s efforts to condemn the property of Logoian and DIBC is inaccurate. Rule 24(a) allows intervention as a right to an applicant claiming “an interest relating to the property or transaction which is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or impede the applicant’s ability to protect that interest.” (emphasis added). The subject matter of an action is not limited by the complaint. Linton by Arnold v. Commissioner of Health and Envir., 973 F.2d 1311 (6th Cir.1992), is an example of a case in which a court’s disposition of an action expands the scope of the lawsuit beyond the complaint. Linton was initiated and tried on a single issue, but applicants were allowed to intervene after the court adopted a plan raising new issues of interest to the applicants for intervention. Id. at 1318 . Another example is provided by Bachman v. Hecht, 659 F.Supp. 308, 311 (D.V.I.1986), cited by the district court, in which the Virgin Islands court considered not only the applicants’ interest in the “only remaining controversy in the case,” the status of a plot of land, but also the applicants’ interest in other issues resolved in a settlement agreement. If the district court ap *505 proves the proposed settlement agreement in this case, its “disposition of the matter” may “as a practical matter” impede Commodities and Lubienski’s ability to protect their interest in their own land. Commodities and Lubienski obviously have standing to assert their interest in their own land.

The ruling of the court below on timeliness seems to be based upon mere passage of time, an insufficient basis for denying a motion to intervene. See, e.g., Bank of America v. Hotel Rittenhouse Assocs., 844 F.2d 1050 , 1056 (3d Cir.1988).

In considering whether an application is timely, a court should consider five factors: (a) the point to which the suit has progressed; (b) the purpose for which intervention is sought; (c) the length of time preceding the application during which the applicant knew or reasonably should have known of its interest in the case; (d) prejudice to the original parties due to the failure of the applicant to apply promptly for intervention upon acquiring the knowledge of its interest; and (e) any unusual circumstances of the case.

Linton by Arnold v. Commissioner of Health and Envir., 973 F.2d 1311, 1317 (6th Cir.1992).

In Linton, this court reversed a district court ruling that an application for intervention was untimely. Linton involved a challenge to Tennessee’s implementation of the Medicaid Act. The district court held that Tennessee’s policy violated the Act, and ordered the state to submit a plan redressing the violation. The court adopted the state’s plan in its entirety. Twenty-five days after entry of final judgment, and two and a half years after the suit was brought, six nursing homes moved to intervene to appeal the judgment. The district court denied the motion as untimely. The court of appeals reversed, holding that the applicants had no reason to intervene prior to the district court’s adoption of the state’s plan because they were “not privy to the terms and conditions” of the state’s plan until it was filed with the court and did not know until entry of final judgment that the court would adopt the plan in its entirety. There is no evidence in the record before us that Commodities and Lubienski were privy to the terms and conditions of the MOA prior to December 9, 1991, when they obtained a copy of the agreement through a Freedom of Information Act request. The Linton court also based its decision upon “unusual circumstances militating] in favor of intervention.” The action had been initiated on a single issue that implicated the interests of only one of the movants; it was the broader terms of the new plan which implicated the interests of the other applicants. Id. at 1318 . The instant case was also initiated on a limited issue which did not directly concern the applicants; it was the more comprehensive settlement agreement which gave rise to Commodities and Lubienski’s interest in the case.

The circuit’s permissive approach to intervention is supported by the reasoning of the district court in In re Acushnet River & New Bedford Harbor, 712 F.Supp. 1019 (D.Mass.1989):

On these facts, this Court refuses to hold the application untimely as a matter of law. To do otherwise would promote a sort of prophylactic intervention whereby parties would be compelled to intervene in matters simply to protect their rights to participate in those matters downstream on the more or less remote chance that a party apparently protecting the intervenors’ interests might someday betray them. Such a result would obviously be expensive and inefficient.

Id. at 1023-24 . This reasoning applies as well to parties who do not know that the outcome of settlement negotiations will be to their detriment (or will even concern them at all). Commodities and Lubienski’s interest in the original condemnation suit was so remote that if they had tried to intervene before the terms of the proposed settlement were known, the district court would likely have held that they had no legally protecta-ble interest in the case. See R211: Opinion and Order of Trial Court, p. 8 (holding that because Commodities and Lubienski do not have a direct interest in the property at issue in the condemnation suit, they do not have direct, legally protectable interest).

Considering all of the factors set out in Linton, supra p. 504 ,1 agree that the district *506 court abused its discretion in ruling that Commodities and Lubienski’s motion to intervene was untimely. The suit had progressed to settlement, which was the earliest point at which the applicants could challenge the settlement agreement. Intervention was sought for the legitimate purpose of challenging a settlement agreement which prejudices the interests of the applicants. There was no evidence to contradict the applicants’ proof that they acted promptly upon learning of their interest in the case. Any prejudice to the original parties caused by the applicants’ intervention does not result from the applicants’ “failure to apply promptly for intervention upon acquiring the knowledge of [their] interest.” Finally, there are “unusual circumstances” in this case: the action as originally filed concerned only the property of Logoian and DIBC, but the subject matter of the case was expanded by the MOA which contemplates condemnation of the applicants’ land as well.

. The related question whether the issues raised by Commodities and Lubienski are ripe for adjudication was not addressed by the district court, nor have the parties raised the issues on appeal. We do not, therefore, address the ripeness issue.