More questions than answers: Plains Commerce Bank v. Long Family Land and Cattle Company, Inc. and the U.S. Supreme Court's failure to define the extent of tribal civil authority over nonmembers on non-Indian land.

AuthorSlepnikoff, Lisa M.

    Since the issue of tribal sovereignty was first addressed in 1832 by Chief Justice John Marshall, tribes have been recognized to posses the powers of inherent sovereignty over their territory and people. (1) Despite changes in federal Indian law and policy, this foundational principle remained intact until 1978 when the U.S. Supreme Court began to depart from traditional notions of tribal sovereignty. (2) In the civil context, this departure is clearly evidenced in Montana v. United States, (3) in which the Court adopted the general principle that tribes lack civil authority over non-Indians, and thereby allowed for tribal civil jurisdiction over non-Indians only under two narrow exceptions. (4) The Montana ruling provides an excellent example of the Supreme Court's use of federal common law to diminish tribal sovereign power, as the Court's decision found little support in prior precedent or federal policy. (5)

    In interpreting the path-making Montana case, the Court has struggled, and thus far has failed, to clearly define the extent of civil authority that tribes possess under the Montana exceptions. (6) The recent case of Plains Commerce Bank v. Long Family Cattle Co. (7) presented the Court with an opportunity to clarify this area of the law. (8) Specifically, the Court was asked to determine whether, under Montana's first exception, Indian tribal courts have subject-matter jurisdiction to adjudicate civil tort claims as an "other means" of regulating the conduct of a nonmember bank that owned fee land inside the boundaries of a reservation and entered into a private commercial agreement with a member-owned corporation. (9) The Court did not provide a discernable answer to this question, and instead set forth a narrow rule that tribal courts lack civil authority to adjudicate claims arising from the sale by a non-Indian of fee land to another non-Indian. 1 0 In so doing, the Court has, once again, inspired confusion in the law of tribal civil jurisdiction and left unanswered important questions regarding the extent of tribal authority over nonmembers. (11)

    This note will offer a review and analysis of the recent United States Supreme Court decision in Plains Commerce Bank. (12) This note begins by addressing the facts and procedure of the case. (13) Then it provides background information on tribal civil authority, including a review of the foundational doctrines of tribal sovereignty and the U.S. Supreme Court's recent decisions that have either modified or abandoned these principles. (14) Finally, this note will address the U.S. Supreme Court's holding in Plains Commerce Bank and argue that the Court misrepresented the facts of the case and employed an unduly narrow interpretation of Montana. (15)



      The Long Company is a closely held family farming and ranching business operating with its principal place of business in Dewey County, South Dakota, on the Cheyenne River Sioux Indian Reservation. (16) To ensure the Long Company's eligibility for Bureau of Indian Affairs (BIA) loan guarantees, the company's articles of incorporation required that at least 51% of the company's outstanding shares be Indian owned at all times. (17) In accordance with the company's articles of incorporation, husband and wife Ronnie and Lila Long (the Longs) owned at least 51 % of the company's shares and were both enrolled members of the Cheyenne River Sioux Tribe (CRST). (18) However, Ronnie Long's father, Kenneth Long, who owned the remaining 49% of the company's shares until his death, was not a tribal member. (19)

      In addition to his 49% interest in the Long Company, Kenneth Long also owned 2,230 acres of deeded agricultural land used in the company's farming and ranching operations that was located within the CRST Indian Reservation. (20) Prior to his death, Kenneth Long mortgaged the 2,230 acres to the Plains Commerce Bank, a South Dakota banking corporation with its principal place of business located outside the reservation. (21) Long mortgaged the land to secure loans to sustain the Long Company operations. (22) The BIA guaranteed these loans due to the Long Company's Indian-owned status. (23)

      In the spring of 1996, Plains Commerce Bank and the Longs entered into negotiations for a new loan agreement. (24) The Longs claimed that during these negotiations the Bank proposed a new loan agreement to finance the sale of the Longs' land back to the Longs via a twenty-year contract for deed. (25) The Bank conceded that a new loan agreement was discussed during the negotiations, but asserted that none of the specifics of the discussion were reduced to writing. (26) In a letter dated April 26, 1996, the Bank stated that it would not sell the land to the Longs under a twenty-year contract for deed because of "possible jurisdictional problems" that would arise if the Bank ever had to foreclose on the land. (27)

      Subsequently, on December 5, 1996, Plains Commerce Bank and the Long Company entered into two related agreements. (28) One agreement provided that Kenneth Long's estate would deed the 2,230 acres to the Bank in lieu of foreclosure. (29) In return, the Bank agreed to cancel some of the Long Company's debt and to make additional operating loans. (30) The other agreement was a lease arrangement in which the Long Company received a two-year lease on the 2,230 acres deeded to the Bank, with an option to purchase the land at the end of the term for $468,000. (31) The Longs claimed that the Bank breached this agreement by failing to provide the necessary operating loans. (32) Numerous cattle perished during the winter because without the operating loans, the Longs were unable to feed their cattle. (33)

      As a result of the substantial loss of livestock, the Long Company was unable to exercise its option to purchase the farm real estate in December 1998. (34) Although the lease expired on December 5, 1998, the Longs did not vacate the land. (35) On March 17, 1999, with the Long Company still in possession of approximately 960 acres, the Bank sold 320 acres of pasture land to nonmembers of the tribe. (36) The Bank then petitioned the Cheyenne River Sioux Tribal Court to serve a notice to quit on the Longs that described the entire 2,230 acre parcel. (37)

      On June 29, 1999, Plains Commerce Bank sold the remaining 1,905 acres to non-Indians. (38) The Long Company remained in possession of the 960 acres, however, and filed a complaint in tribal court alleging that the Bank had impermissibly engaged in self-help measures by selling the land while the Longs still had possession. (39) The Longs also sought a temporary restraining order to prevent Plains Commerce Bank's sale of the remaining 1,905 acres of land (40) The Bank moved to dismiss the Longs' claim on the grounds that the tribal court lacked subject matter jurisdiction. (41) Both the Bank's motion to dismiss and the Longs' motion for a restraining order were denied. (42)

      The Longs then amended their complaint to include several causes of action against the Bank including breach of contract, bad faith, lack of consideration, and discrimination. (43) The discrimination claim alleged that the Bank sold the land to nonmembers on more favorable terms than those offered to the Long Company. (44) The Bank's answer denied that the tribal court had jurisdiction, but asserted in the alternative a counterclaim alleging wrongful holdover of possession of the land and sought damages and the Longs' eviction. (45)

      The tribal court jury found that Plains Commerce Bank breached the loan agreement, discriminated against the Longs based on their status as Indians, and acted in bad faith in its dealings with the Longs. (46) However, the jury found that the Bank did not use self-help remedies in its attempt to remove the Longs from the land. (47) Both Plains Commerce Bank and the Longs appealed the tribal court's decision. (48) The Cheyenne River Sioux Tribal Court of Appeals affirmed the lower court's ruling on all counts. (49)

      The Bank then filed a motion for summary judgment in South Dakota District Court, seeking a declaratory judgment that the Cheyenne River Sioux Tribal Court lacked subject matter jurisdiction. (50) The South Dakota District Court found the tribal court did have jurisdiction under Montana's "consensual relationship" exception. (51) In Montana, the Court determined that tribes generally may not exercise jurisdiction over nonmembers unless the regulation falls under one of its identified exceptions. (52) The "consensual relationship" exception grants tribes authority to regulate consensual relations "through taxation, licensing, or other means." (53) The district court determined that the Longs' discrimination claim qualified as "other means" of regulation and, therefore, the tribe could exercise jurisdiction. (54) Accordingly, the district court denied the Bank's motion for summary judgment. (55) Plains Commerce Bank appealed the district court's decision, arguing that the court erred in concluding that the tribal court had jurisdiction under the Montana "consensual relations" exception. (56) The Eighth Circuit Court of Appeals rejected the Bank's argument and affirmed the judgment of the district court in all respects. (57)

      Plains Commerce Bank then filed a petition for certiorari to the United States Supreme Court. (58) In its petition, the Bank argued that the lower courts erred in finding that the Montana "consensual relationship" exception allowed for tribal civil-adjudicatory jurisdiction over non-Indian defendants. (59) The Longs countered that the lower courts correctly applied the Montana "consensual relationship" exception and, for the first time, further claimed that Plains Commerce Bank lacked standing to bring the appeal. (60) The U.S. Supreme Court granted certiorari on January 4, 2008. (61)


      After determining that Plains Commerce Bank had...

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