Plains Commerce Bank v. Long Family Land and Cattle Company, Inc.: an introduction with questions.

• Author: Pommersheim, Frank
• Position: Tribal jurisdiction

1. INTRODUCTION

   The Plains Commerce Bank (1) case began as a routine case in the Cheyenne River Sioux Tribal Court system between a rancher and a bank that had been doing business together for "many years" (2) on the Cheyenne River Sioux Reservation. The rancher was an Indian family and its Indian controlled corporation. The bank was a local, non-Indian off reservation bank. The case ended with a decision by the United States Supreme Court that carved out a new jurisdictional rule for tribal courts. This new rule is likely to have significant legal and economic impact for doing business on the reservation and it is these ramifications that are the basis for the Symposium that is being sponsored by the South Dakota Law Review.

   The ruling of the U.S. Supreme Court is best understood by reviewing the factual background of the case, as well as the decision of each of the lower courts. Such a review demonstrates a rather ordinary case in which the jurisdictional challenge clearly falls within the well-known proviso of the "pathmarking" (3) case of Montana v. United States. (4) Despite the consistent analytical approach of the lower courts, both tribal and federal, the U.S. Supreme Court fashioned a new rule, which completely removed the case from the doctrinal reach of Montana. In so doing, the Court appeared more inhospitable than ever to the possibility of any tribal court jurisdiction over non-Indians.

2. FACTUAL BACKGROUND

   Plains Commerce Bank, "formerly known as the Bank of Hoven, is a South Dakota banking corporation with its principal place of business" located in Potter County, South Dakota. (5) Potter County is located directly adjacent to Dewey County, which is located completely within the exterior boundaries of the Cheyenne River Sioux Reservation. The Long Family Land and Cattle Company, Inc. "is a South Dakota chartered family farm corporation with its principal place of business" located on the Cheyenne River Sioux Reservation. (6) Ronnie Long is the son of Kenneth and the late Maxine Long. Ronnie's wife is Lila Long. Ronnie and Lila are both members of the Cheyenne River Sioux Tribe, as was Maxine prior to her death. The deceased Kenneth Long was a non-Indian and not a member of the Cheyenne River Sioux Tribe. (7)

   Plains Commerce Bank provided the Longs and the Long Family Land and Cattle Company with various operating loans over the years for their cattle ranching operation that took place on land located solely within the Cheyenne River Sioux Reservation. This included land owned in fee by the Longs and trust land leased from the Cheyenne River Sioux Tribe.

   Prior to the death of Kenneth on July 17, 1995, he owned 2,230 acres of deeded agricultural land located within the Cheyenne River Sioux Reservation. At the time of his death, this land was mortgaged to Plains Commerce Bank to secure various operating loans. Kenneth also owned 49% of the stock in the Long Family Land and Cattle Company. In his will, Kenneth devised all his land and shares in the Long Family Land and Cattle Company to his four children, all of whom are tribal members. Ronnie's three siblings assigned all of their interests to Ronnie. As a result, Ronnie and Lila owned 100% of the stock in the Long Family Land and Cattle Company.

   The Bank continued to do business with Ronnie and Lila Long and the Long Family Land and Cattle Company. It is these subsequent transactions that are at the heart of this case. In the spring of 1996, an officer of the Bank came on the reservation to inspect the land and machinery and to continue discussions with Ronnie and Lila Long and tribal officials about the best way to proceed. In lieu of foreclosure, the Long estate agreed to deed Kenneth's land to the Bank for a credit of $478,000 against the $750,000 debt of Kenneth Long and the Long Family Land and Cattle Company. The Bank agreed to sell the land back to the Longs via a twenty year contract for deed, but subsequently reneged on its offer in a letter dated April 26, 1996, citing "possible jurisdictional problems if the bank ever had to foreclose on [the] land when it contracted or leased to an Indian owned entity on the reservation." (8) There were also discussions about additional operating loans. (9)

   On December 5, 1996, a meeting took place at the Bank's office in Hoven, South Dakota. Various documents were signed by the Bank and Ronnie and Lila Long. They included a two year lease on the 2,230 acre parcel of land with an option to purchase the land for $468,000 at the conclusion of the lease, the conveyance by the Long estate, acting through its representative, of the 2,230 acre Long property to the Bank, and two operating loans in the amounts of $70,000 and $37,500. (10)

   The Longs claimed that because of the harsh winter and blizzards of 199697 they were in dire need of the agreed-upon loans, but the loans were never forthcoming. As a result, the Longs suffered substantial financial loss and were unable to exercise their option to purchase the land. Upon expiration of the lease, the Longs did not vacate the land. Nevertheless, in March 1999, the Bank sold 320 acres to Mr. and Mrs. Ralph Pesicka. On June 16, 1999, the Bank sold the remaining 1,905 acres to Edward and Mary Jo Mackjewski on a contract for deed. Both the Pesickas and the Mackjewskis are non-Indians. (11)

3. PROCEEDINGS IN THE CHEYENNE RIVER SIOUX TRIBAL COURT

   The Bank initiated legal proceedings against the Longs in state court by requesting the Cheyenne River Sioux Tribal Court serve a state Notice to Quit on the Longs. This odd request was nevertheless approved by Judge Bluespruce and the Longs were served by the tribal court on June 16, 1999. (12)

   The Longs and the Long Family Land and Cattle Company subsequently filed their own action against the Bank in tribal court. The Longs sought "a temporary restraining order restraining the bank from selling the land...." (13) Subsequently, "[t]he bank moved to dismiss, claiming that the tribal court lacked subject matter jurisdiction." (14) Both motions were denied. The Longs subsequently amended their complaint to include several causes of action that...