469 F.2d 593 (10th Cir. 1972), 72-1214, Davis v. Morton

Docket Nº:72-1214.
Citation:469 F.2d 593
Party Name:Abel DAVIS et al., Plaintiffs-Appellants, v. Rogers C. B. MORTON, Secretary of the Interior of the United States of America, et al., Defendants-Appellees.
Case Date:November 24, 1972
Court:United States Courts of Appeals, Court of Appeals for the Tenth Circuit

Page 593

469 F.2d 593 (10th Cir. 1972)

Abel DAVIS et al., Plaintiffs-Appellants,

v.

Rogers C. B. MORTON, Secretary of the Interior of the United States of America, et al., Defendants-Appellees.

No. 72-1214.

United States Court of Appeals, Tenth Circuit.

November 24, 1972

Page 594

W. B. Kelly, Santa Fe, N. M., for plaintiffs-appellants.

Dennis M. O'Connell, Department of Justice, Washington, D. C. (Kent Frizzell, Asst. Atty. Gen., Victor R. Ortega, U. S. Atty., Richard J. Smith, Asst. U. S. Atty., Albuquerque, N. M., and Carl Strass, Department of Justice, Washington, D. C., for defendants-appellees.

Before HILL, HOLLOWAY and BARRETT, Circuit Judges.

HILL, Circuit Judge.

This is an appeal from the United States District Court for the District of New Mexico for dismissing appellants' action against the United States government. Appellants allege the government failed to follow the provisions of the National Environmental Policy Act (NEPA), 42 U.S.C. § 4321 et seq., and of 25 U.S.C. § 415 before approving a 99-year lease on the Tesuque Indian Reservation in Santa Fe County, New Mexico.

The facts are simple and uncontroverted. On April 17, 1970, a 99-year lease of restricted Indian lands was executed by the Pueblo of Tesuque (Pueblo), as lessor, and Sangre de Cristo Development Company, Inc. (Sangre), a New Mexico corporation, as lessee. The agreement granted Sangre a lease on a 1300-acre tract of land called "Tract 1" and granted lease options on four other tracts, thereby subjecting approximately 5400 acres to the lease. The purpose of the lease is to develop the property for residential, recreational and commercial purposes. Ultimately a small city is planned with a population of approximately 15, 000 inhabitants.

On May 24, 1970, appellee Walter O. Olson, Area Supervisor for the New Mexico District of the Bureau of Indian Affairs of the Department of the Interior, approved the lease agreement pursuant to 25 U.S.C. § 415. Olson's authority was granted to him by appellee Lewis R. Bruce, Commissioner of Indian Affairs in the Department of the Interior, and by appellee Rogers C. B. Morton, Secretary of the Interior of the United States. Subsequent to this initial lease approval, appellees have approved a master plan for the development of the total acreage, a plat plan for the first phase of development, deed restrictions, the make-up of an architectural and engineering review board, and the plan for the development of a condominium apartment complex on Tract 1 of the leased premises. Appellants, two of whom are landowners living near the leased Indian property and two of whom are non-profit corporations concerned with protection of the environment, filed the complaint on October 22, 1971, asking for a preliminary injunction enjoining future work by Sangre on the leased premises. Appellants charged that appellees were without authority to grant the lease since no environmental impact study was conducted prior to approval of the lease as required by NEPA, 42 U.S.C. § 4332 (2)(C). 1 They further asserted that appellees

Page 595

violated 25 U.S.C. § 415(a) 2 by approving the lease on Indian lands without first being assured that certain statutory mandates had been met. Appellants requested the court to issue a preliminary and permanent injunction enjoining appellees from approving, allowing or acting in any way on submissions or approvals required or permitted under the lease agreement until the environmental impact of the project had been studied and evaluated. Appellants further requested the court issue a Writ of Mandamus requiring appellees to follow mandates of NEPA before taking any future action on the Pueblo lease.

The hearing on the preliminary injunction was held November 22, 1971, and thereafter the court entered its order denying appellants' motion for preliminary injunction, 335 F.Supp. 1258. Later the court adopted the findings of fact and conclusions of law found in its denial for a preliminary injunction as its findings of fact and conclusions of law with respect to the merits of the action, and dismissed the action with prejudice. The trial court concluded the lands in question are owned by the Pueblo subject to a restraint on alienation without approval of the Secretary. The United States was not a party to the lease, but rather was acting as a fiduciary or guardian of the Pueblo interests in the lease. The only "federal action" was in approving the lease; as the United States has no interest in the lease, their approval does not constitute "major federal action." Therefore, 42 U.S.C. § 4332(2)(C) does not apply. In support of this conclusion, the trial court reasons that since the amendment to 25 U.S.C. § 415 specifically relates to environmental concerns on Indian lands, and was passed after NEPA, it is logical to infer that NEPA did not cover Indian lands or there would be no need to have amended § 415. The trial court's second conclusion is that since § 415 was amended on June 2, 1970, more than a week after the Secretary approved the lease, it has no effect on the lease.

Two issues are presented on appeal. First, does the Secretary's authority to ratify or reject leases relating to Indian lands constitute major federal action? Second, does 25 U.S.C. § 415, as amended, have any effect on a lease signed before the amendment's enactment date? As we answer the first issue in the affirmative, it will be unnecessary to discuss the retroactive effect of § 415.

Appellees' primary thesis is that although the contractual relationship between Sangre and the Pueblo is a lease, it is not a federal lease and therefore does not constitute major federal action. The United States did not initiate the lease, was not a party, possessed no interest in either the lease or the development, did not participate financially or benefit from the lease in any way. Before federal action will constitute major federal action under the mandates of NEPA, the government must initiate, participate in or benefit from the project.

We feel the government's interpretation of NEPA is too constrained for our

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court to adopt. Title 42 U.S.C. § 4331 (b) states:

[I]t is the continuing responsibility of the Federal Government to use all practicable means, consistent with other essential considerations of national policy, to . . . (2) assure for all Americans safe, healthful, productive, and esthetically and culturally pleasing surroundings; (3) attain the widest range of beneficial uses of the environment without degradation, risk to health or safety, or other undersirable and unintended...

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