CHAPTER 14 INDIAN TRUST ISSUES
| Jurisdiction | United States |
(Feb 2004)
INDIAN TRUST ISSUES
Maynes, Bradford, Shipps & Sheftel, LLP
Durango, Colorado
Stephen L. Simpson 2
Division of Indian Affairs
U.S. Department of the Interior - Office of the Solicitor
Washington, D.C.
Kenneth R. Vogel 3
Office of Enforcement - Minerals Management Service
U.S. Department of the Interior
Denver, Colorado
Part 1 A Brief History of Indian Trust Law
From Justice Marshall to Navajo Nation
Since the founding of the United States, the relationship between the Federal government and Indian tribes has swung back and forth from termination of Indian tribes and cultures to strict oversight by the Secretary of the Interior to support for tribal sovereignty and self-determination. Underlying the shifts in law and policy through the years, however, has been the concept that the United States has a trust responsibility to Indian tribes and Indian people and is bound to act in their best interest. 4
The concept of the trust relationship was first enunciated by no less a jurist than Chief Justice John Marshall. Writing in a case where the Supreme Court was faced with deciding whether an Indian tribe was a "foreign state", he said that the tribes, rather than being states or foreign nations, are "domestic dependent nations" and that the relationship of the tribes "to the United States resembles that of a ward to his guardian." 5 Through the years since 1831, many Federal court decisions at all levels have opined on the nature of the trust responsibility. More than one hundred years later, the Supreme Court summed up the duties of the United States with respect to Indian tribes and individuals.
Furthermore, this Court has recognized the distinctive obligation of trust incumbent upon the Government in its dealings with these dependent and sometimes exploited people. In carrying out its treaty obligations with the Indian tribes the Government is something more than a mere contracting party. Under a humane and self imposed policy which has found expression in many acts of Congress and numerous decisions of this Court, it has charged itself with moral obligations of the highest responsibility and trust. Its conduct, as disclosed in the acts of those who represent it in dealings with the Indians, should therefore be judged by the most exacting fiduciary standards. 6
The extent of the trust responsibility is defined by relevant statutes and regulations. 7 When interpreting those statutes, courts (and the Secretary of the Interior) will resolve ambiguities in statutes in favor of the Indians. 8 As ruled by the Tenth Circuit Court of Appeals, the same principle applies to the interpretation of regulations.
When the Secretary is acting in his Ýtrustee¨ role rather than solely as a regulator and is faced with a decision for which there is more than one "reasonable" choice as that term is used in administrative law, he must choose the alternative that is in the best interests of the Indian tribe. 9
As with the concept of the trust responsibility itself, the relevant statutes and regulations date to the beginning of the United States.
Beginning in 1790, Congress enacted a series of laws, under its broad constitutional authority "to regulate commerce . . . with the Indian tribes" 10 that were aimed at controlling trade between Indians and non-Indians and protecting Indian lands from fraudulent purchase or conveyance. 11 One of those laws was the Nonintercourse Act. As currently codified, the Nonintercourse Act provides, in pertinent part:
No purchase, grant, lease or other conveyance of lands, or of any title or claim thereto, from any Indian nation or tribe of Indians, shall be of any validity in law or equity, unless the same be made by treaty or convention entered into pursuant to the Constitution. 12
Even though the United States stopped entering into treaties with Indian tribes in 1871, 13 the Nonintercourse Act still requires that any alienation of Indian land must have the consent of the United States. 14 The Nonintercourse Act's "overriding purpose is the protection of Indian lands," which is achieved by "imposing on the federal government a fiduciary duty to protect those lands." 15 While the particular justifications for the Nonintercourse Act's restraints on the alienation of tribally owned lands have changed over time, the need for such restraints remains:
Today, the statutory restraints on alienation of Indian land insulate Indian lands from the full impact of market forces, preserving the Indian land base for the furtherance of Indian values. If tribal land were not subject to restraints on alienation and tax immunities, market forces and state tax assessors would eventually erode Indian ownership of the reservation. . . . The continued enforcement of federal restrictions, in this view, derives not from a presumed incompetence of the "ward," but from a perceived value in the desirability of a separate Indian culture and polity. 16
Thus, with certain exceptions not relevant here, the leasing or other alienation of tribal land, including that for mineral development, requires the consent of the United States. That consent is now given by Congress or delegated by Congress to the Executive Branch, generally to the Secretary of the Interior. 17
Not all Indian land is tribal land, however. In 1887, in an attempt to break up the tribal system and "civilize" the Indians, Congress passed the General Allotment Act (GAA). 18 Section 1 of the GAA authorizes the President to allot to each Indian residing on a reservation up to 80 acres of agricultural land or 160 acres of grazing land found within the reservation. 19 Section 5 of the Act provides that the United States shall retain title to such allotted lands in trust for the benefit of the allottees. 20
Because of these restrictions on alienation, allotted Indian land can only be leased or otherwise alienated under the same condition as tribal land, i.e., with the consent of the United States, either through direct Congressional action or delegation from Congress to the Executive Branch, again generally the Secretary of the Interior. Thus, with respect to Indian land (and mineral resources), the trust responsibility flows to the Indian landowner, whether that owner is an Indian tribe or the individual Indian owner of allotted land.
Although the Nonintercourse Act and the GAA are the fundamental charters for the restrictions on leasing of Indian land, those statutes do not impose specific trust duties on the United States or the specific conditions (apart from Federal approval) under which the land may be leased. 21 In the mineral leasing context, especially for oil and gas, those duties are generally found in the Act of March 3, 1909; the Indian Mineral Leasing Act (IMLA); the Indian Mineral Development Act (IMDA); and, for royalty management, the Federal Oil and Gas Royalty Management Act (FOGRMA), and in the regulations promulgated by the Secretary under those statutes. 22 Those statutes and regulations recognize and allow for tribal self-determination, but still require the Secretary to act in the overall best interest of the tribe or the individual Indian, even if that means choosing to do what is in the long term best interest of the tribe or the individual Indian (with due consideration of the short term interests and of the wishes of the tribe or individual Indian).
After the GAA went into effect, Congress realized that the allotment policy was not working to give the allottees the income from their land necessary to make them self-reliant. It therefore passed a series of statutes allowing for the leasing of their land by the allottees with the approval of the Secretary of the Interior. One such statute was the Act of March 3, 1909. 23 That Act provides that:
Ýall¨ lands allotted to Indians in severalty . . . may by said allottee be leased for mining purposes for any term of years as may be deemed advisable by the Secretary of the Interior; and the Secretary of the Interior is authorized to perform any and all acts and make such rules and regulations as may be necessary for the purpose of carrying the provisions of this section into full force and effect. 24
The Secretary has fleshed out the bare bones of this statute in regulations. Because those regulations, through extensive cross-references, largely track those for tribal land, they will be discussed here in conjunction with the tribal regulations.
The first general nationwide statute providing for mineral leasing of tribal land was the Indian Mineral Leasing Act of 1938. 25 The IMLA provides, like the 1909 Act, that tribes may lease their land for mineral development, with the approval of the Secretary.
On and after May 11, 1938, unallotted lands within any Indian reservation or lands owned by any tribe, group, or band of Indians under Federal jurisdiction, except those specifically excepted from the provisions of sections 396a to 396g of this title, may, with the approval of the Secretary of the Interior, be leased for mining purposes, by authority of the tribal council or other authorized spokesmen for such Indians, for terms not to exceed ten years and as long thereafter as minerals are produced in paying quantities. 26
Again, like the 1909 Act, the IMLA provides that any mineral lease of tribal land is subject to the regulations of the Secretary. 27
The general regulations implementing the IMLA and the 1909 Act are in 25 C.F.R. Parts 211 and 212, respectively. The regulations set the standard for the Secretary's administration of mineral leases by noting that they "are intended to ensure that Indian mineral owners desiring to have their resources developed are assured that they will be developed in a manner that maximizes their best economic interests and minimizes any adverse environmental impacts or cultural impacts resulting from such...
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