Tag: sovereign immunity

Washington Supreme Court Rejects Sovereign Immunity Defense in Quiet Title Action

sovereign immunityA decision by the Washington Supreme Court conflicts with decisions of other courts on the issue whether plaintiffs can avoid tribal sovereign immunity in suits involving real property by suing “in rem,” i.e., bringing a lawsuit focused on real property rather than its tribal owner. While the Washington decision relates to a lawsuit to quiet title, the Court’s rationale would also support a lawsuit by a state or county to foreclose on land owned by tribes for failure to pay property taxes.

In Lundgren v. Upper Skagit Tribe, 2017 WL 635649 (Wash. 2017), the Upper Skagit Tribe purchased certain fee simple land in 2014 adjoining land owned by the Lundgrens, who had owned the land since 1947. The Lundgrens had long treated a fence that had been on the property since at least 1947 as the boundary of their property. When the Tribe informed the Lundgrens that the fence actually encompassed land owned by the Tribe, the Lundgrens sued to quiet title, arguing they acquired title to the disputed property by adverse possession or by mutual recognition and acquiescence long before the Tribe bought the land. The Tribe moved to dismiss under CR 12(b)(1) for a lack of subject matter jurisdiction based on the Tribe’s sovereign immunity and the rule that requires joinder of a necessary and indispensable party, which the Lundgrens could not satisfy because of the Tribe’s immunity. The trial court denied the Tribe’s motion and the Washington Supreme Court affirmed, citing the U.S. Supreme Court’s 1992 decision in Yakima County upholding Washington’s right to impose a property tax on tribal land and principles of equity: “After the Lundgrens commenced the quiet title action, the Tribe claimed sovereign immunity and joinder under CR 19 to deny the Lundgrens a forum to acquire legal title to property they rightfully own. The Tribe has wielded sovereign immunity as a sword in disguise. While we do not minimize the importance of tribal sovereign immunity, allowing the Tribe to employ sovereign immunity in this way runs counter to the equitable purposes underlying compulsory joinder. … Finding otherwise, as correctly articulated by the trial court, is contrary to common sense, fairness, and due process for all involved.” (Internal quotations and citations omitted.

Whether in rem suits can be used to avoid sovereign immunity is an unresolved question. In County of Yakima v. Confederated Tribes and Band of Yakima Nation, 502 U.S. 251, 263 (1992), and Cass County v. Leech Lake Band of Chippewa Indians, 524 U.S. 103 (1998), the U.S. Supreme Court upheld the right of states to impose property taxes on land allotted under acts of Congress and later re-acquired by tribes in fee simple. In both cases, however, the court did not address whether tribal sovereign immunity might bar a state tax foreclosure action if the tribes refused to pay the taxes. In 2010, the court agreed to review a decision by the Second Circuit Court of Appeals in Oneida Nation v. Madison County, 605 F.3d 149 (2d. Cir. 2010), that the tribe’s sovereign immunity barred a tax foreclosure action by the county, but the court changed its mind, at the tribe’s request, after the tribe voluntarily waived “its sovereign immunity to enforcement of real property taxation through foreclosure by state, county and local governments within and throughout the United States.” In Cayuga Indian Nation of New York v. Seneca County, N.Y., 761 F.3d 218 (2d. Cir. 2014), however, the Second Circuit held that even though the county had the right to impose a property tax on the property owned by the tribe, it could not foreclose for non-payment because of the

Nation’s sovereign immunity. The court rejected the county’s argument that a foreclosure action was in rem (against the property) rather than against the Nation. These circumstances make the Washington decision a viable candidate for Supreme Court review in the event the Tribe should file a petition for review.

ARTICLE BY Brian L. Pierson of Godfrey & Kahn S.C.

Copyright © 2017 Godfrey & Kahn S.C.

The Supreme Court Decides Bay Mills Case, Leaves Tribal Sovereign Immunity Intact

Godfrey Kahn

In its long-awaited decision in Michigan v. Bay Mills Indian Community, the U.S. Supreme Court today re-affirmed its 1998 holding in Kiowa Tribe v. Manufacturing Technologies, Inc. 523 U.S. 751 (1998) that tribal sovereign immunity extends to tribes’ governmental and commercial activities, both on reservation and off. In a 5-4 decision, the Court affirmed the Sixth Circuit’s decision that the Indian Gaming Regulatory Act waiver of tribal sovereign immunity for suits to enjoin gaming on Indian lands in violation of a tribe’s gaming compact with a state did not apply to tribal gaming on non-Indian lands and that the State was barred by the doctrine of sovereign immunity from suing the Tribe directly for damages.

The Court rejected Michigan’s arguments that Kiowa was wrongly decided and that tribes should enjoy no immunity with respect to their commercial, off-reservation activities. The majority opinion, authored by Justice Kagan and joined by Justices Roberts, Kennedy, Breyer and Sotomayor, emphasized the doctrine that the court should not overrule its previous decisions without special justification (stare decisis), pointing out that (1) the Court had explicitly invited Congress to consider limitations on tribal sovereign immunity its Kiowa decision, (2) Congress had, in fact, considered several bills that would have imposed broad limits but had not enacted any of them (“Having held in Kiowa that this issue is up to Congress, we cannot reverse ourselves because some may think its conclusion wrong” Slip. Op. 20), and (3) Michigan had other means of enforcing state law against Bay Mills, including denial of required licenses, suits against employees and officials of the tribe to enjoin violations of state law and criminal prosecution of tribal officials and employees and for violations of state criminal laws.

The Court concluded:

As “domestic dependent nations,” Indian tribes exercise sovereignty subject to the will of the Federal Government. …Sovereignty implies immunity from lawsuits. Subjection means (among much else) that Congress can abrogate that immunity as and to the extent it wishes. If Congress had authorized this suit, Bay Mills would have no valid grounds to object. But Congress has not done so: The abrogation of immunity in IGRA applies to gaming on, but not off, Indian lands. We will not rewrite Congress’s handiwork. Nor will we create a freestanding exception to tribal immunity for all off reservation commercial conduct. This Court has declined that course once before. To choose it now would entail both overthrowing our precedent and usurping Congress’s current policy judgment.

In her concurring opinion, Justice Sotomayor asserted that the historical basis for tribal sovereign immunity is stronger than the dissent recognized and that the result reached by the majority is consistent with comity in view of the fact that State sovereign immunity prevents states from being sued by tribes. Justice Sotomayor also pointed out the special challenges that tribes face with respect to raising revenue and the role that their commercial enterprises play in funding government.

The unmistakable premise of the dissenting opinion, authored by Justice Thomas and joined by Justices Scalia, Ginsburg and Alito, is that sovereign immunity as currently exercised by tribes under the rule of Kiowa has led to widespread, grave and intolerable injustices. These injustices, according to the dissenters, warrant departing from the rule of stare decisis to correct the Court’s “mistake” in the Kiowa decision:

In Kiowa, this Court adopted a rule without a reason: a sweeping immunity from suit untethered from commercial realities and the usual justifications for immunity, premised on the misguided notion that only Congress can place sensible limits on a doctrine we created. The decision was mistaken then, and the Court’s decision to reaffirm it in the face of the unfairness and conflict it has engendered is doubly so.

Dissent, slip Op. 18.

Justice Thomas’ opinion highlights areas, including taxation, tobacco commerce, payday lending and campaign finance, in which tribes have “exploited” immunity to avoid state regulation. In a separate dissenting opinion, Justice Ginsburg expressed her view that the Court had gone too far not only in expanding the scope of tribal sovereign immunity in Kiowabut also in expanding state sovereign immunity from suits by tribes to enforce federal laws in Seminole Tribe v. Florida, 517 U.S. 44 (1996). Justice Ginsburg would impose greater limits on the immunity of both sovereigns.

The Court’s decision leaves unclear two areas of tribal sovereign immunity jurisprudence. First, the Court expressly acknowledged that it has never “specifically addressed” whether immunity “should apply in the ordinary way if a tort victim, or other plaintiff who has not chosen to deal with a tribe, has no alternative way to obtain relief for off-reservation commercial conduct. The argument that such cases would present a ‘special justification’ for abandoning precedent is not before us” Slip. Op. 16, n.8. The Court’s comment will be viewed as an invitation for a plaintiff to make the argument that this situation does indeed present a “special justification” for an exception to immunity.

The Court’s opinion also leaves unaddressed the extent to which tribal sovereign immunity applies to subsidiary entities. In a footnote, the dissent observed, without comment, that “[l]ower courts have held that tribal immunity shields not only Indian tribes themselves, but also entities deemed ‘arms of the tribe.’ … In addition, tribal immunity has been interpreted to cover tribal employees and officials acting within the scope of their employment.”

The consequences of the Court’s decision are likely to be (1) arguments by state lobbyists that Congress should take action to limit tribal immunity for the reasons set forth in the dissenting opinion and (2) suits based on the assertion that there should be an exception to tribal sovereign immunity for a “tort victim or other plaintiff who has not chosen to deal with a tribe” who has “no alternative way to obtain relief for off-reservation commercial conduct.”

Article By:

Brian L. Pierson
Of:
Godfrey & Kahn S.C.