Oil Producing Co v. Board of Equalization of State of Montana
| Citation | 81 L.Ed. 95,57 S.Ct. 132,299 U.S. 159 |
| Decision Date | 07 December 1936 |
| Docket Number | No. 37,BRITISH-AMERICAN,37 |
| Parties | OIL PRODUCING CO. v. BOARD OF EQUALIZATION OF STATE OF MONTANA et al. * |
| Court | United States Supreme Court |
Messrs. H. C. Hall, of Great Falls, E. K. Cheadle, Jr., of Shelby, and E. J. McCabe, of Great Falls, for petitioner.
Messrs. Oscar A. Provost and Raymond T. Nagle, both of Helena, Mont., for respondents.
A judgment of the Supreme Court of Montana sustaining state taxes on the production of oil and gas under a lease covering such minerals in certain lands of the Blackfeet Indians (101 Mont. 293, 54 P.(2d) 129) is here under review.
These Indians are wards of the United States and have been occupying a reservation in Montana. During recent years they have received allotments in severalty from lands in the reservation, and they now hold the allotments under so-called trust patents, whereby the United States declares that it will retain the title for a period of twenty- -five years in trust for the use and benefit of the several allottees, and at the expiration of that period will convey the same by patent to them or their heirs. Under the terms of the controlling statute, as also under the terms of the patents, all minerals, including coal, oil, and gas, in or under the allotted lands are reserved to the United States for the benefit of the tribe 'until Congress shall otherwise direct.'
The petitioner holds a mining lease covering 'all the oil and gas deposits in or under' certain of these allotted lands a stated share of the gross production being reserved to the United States for the benefit of the Indian Tribe as the lessor's royalty. The lease was authorized by a resolution of the tribal council, was recommended by the United States agent in charge of the reservation, was given for a term of five years from the date of its approval, was approved by the Secretary of the Interior October 5, 1934, and recites that it was given in accordance with section 3 of the Act of February 28, 1891, c. 383, 26 Stat. 795 (25 U.S.C.A. § 397), as amended by Act of May 29, 1924, c. 210, 43 Stat. 244 (25 U.S.C.A. § 398).
The taxes in question are a gross production tax and a net proceeds tax, and it is conceded that the State is without power to apply either to the production under this lease, save and except as Congress may have given its assent. Whether Congress has given its assent is the ultimate question, and this turns on the subordinate questions (a) which of several statutes controls the leasing of tribal lands in this reservation for mining oil and gas, and (b) whether the reserved oil and gas deposits underlying allotted lands in this reservation constitute unallotted lands in the sense of these statutes.
There have been two related but distinct lines of legislation respecting the leasing of tribal Indian lands for mining purposes. The older and more general line has been regarded uniformly as including lands in reserva- tions created by legislation, such as a treaty or congressional enactment; and has also been regarded at times as including, and at other times as excluding, lands in a reservation created by Executive Order. The proviso to section 3 of the Act of February 28, 1891, and the Act of May 29, 1924, both before mentioned, belong of the first line. The later and narrower line, which doubtless was prompted by diverse administrative interpretations of the other, is in terms confined to lands in reservations created by Executive Order. The Act of March 3, 1927, c. 299, 44 Stat. 1347 (25 U.S.C.A. §§ 398a to 398e), belongs to this line.
We are of opinion, as was the state court, that the Blackfeet reservation, as existing in recent years, was created by legislation and not by Executive Order.
The original territory of the Blackfeet and other Indians associated with them included a large area, as is shown by a treaty of September 17, 1851, 2 Kappler Indian Affairs (2d Ed.) 594, and a treaty of October 17, 1855, 11 Stat. 657. Under Executive Orders of 1873 and 1874, an Act of Congress of April 15, 1874, c. 96, 18 Stat. 28, and Executive Orders of 1875 and 1880, the Blackfeet and certain of the other Indians associated with them came to occupy a large part of this original territory as a reservation specially set apart for them.
By an agreement or convention, ratified by Congress May 1, 1888, c. 213, 25 Stat. 113, which recited various considerations moving from the Blackfeet to the United States and the reverse, and from the Blackfeet to their associates and the reverse, much of the earlier reservation was ceded to the United States, and three separate reservations, all within the limits of the earlier reservation, were created, one of these being set apart for the Blackfeet and the other two for the other Indians. By another agreement or convention, ratified by Congress June 10, 1896, c. 398, 29 Stat. 321, 353, which disclosed various considerations moving from the Indians to the government and the reverse, part of the separate Blackfeet reservation was ceded to the United States, and the remainder was set apart as the tribe's future reservation. This last reservation is the one with which we now are concerned It rests entirely on the agreements or conventions which were ratified and given effect by Congress. The Executive Orders before mentioned, evidently designed to be temporary, have been superseded by congressional action and no longer are of any force.
We turn, therefore, to the legislation bearing on the leasing for mining purposes of tribal lands in such a reservation. We say 'tribal lands' because (1) here the mineral deposits did not pass to the allottees but were reserved for the benefit of the tribe, and (2) other and distinct legislation controls the leasing for mining purposes of lands of individual allottees where there is no reservation of the mineral deposits.
The proviso to section 3 of the Act of February 28, 1891 (25 U.S.C.A. § 397), reads:
'Where lands are occupied by Indians who have bought and paid for the same, and which lands are not needed for farming or agricultural purposes, and are not desired for individual allotments, the same may be leased by authority of the council speaking for such Indians, for a period not to exceed * * * ten years for mining purposes in such quantities and upon such terms and conditions as the agent in charge of such reservation may recommend, subject to the approval of the Secretary of the Interior.'
The Act of May 29, 1924 (25...
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