591 F.2d 1300 (Fed. Cir. 1979), 772-71, Mitchell v. United States

Docket Nº:772-71
Citation:591 F.2d 1300
Party Name:Mitchell v. United States
Case Date:January 24, 1979
Court:Court of Federal Claims

Page 1300

591 F.2d 1300 (Fed. Cir. 1979)

Helen MITCHELL et al.



Nos. 772--71 to 775--71.

United States Court of Claims.

Jan. 24, 1979

Charles A. Hobbs, Washington, D.C., attorney of record, for plaintiffs. Wilkinson, Cragun & Barker, Jerry R. Goldstein and Robin A. Friedman, Washington, D.C., of counsel.

David M. Marshall, Washington, D.C., with whom was Asst. Atty. Gen. James W. Moorman, Washington, D.C., for defendant. Craig A. Decker, Washington, D.C., of counsel.

Before FRIEDMAN, Chief Judge, and DAVIS, NICHOLS, KUNZIG, BENNETT and SMITH, Judges, en banc.


DAVIS, Judge:

These connected suits 1 by individual Indians and two Indian groups present claims for damages said to arise from the Government's management and disposition of the claimants' property. The principal plaintiffs are (1) 1465 individuals owning interests in Indian trust allotments on the Quinault Reservation in the State of Washington and (2) the Quinault Tribe which now has about 4,000 acres on the Reservation. 2 The Reservation, consisting mainly of forest land, was established in 1873. Over a number of years, the Government, acting primarily under the General Allotment Act of 1887, 24 Stat. 388, 25 U.S.C. ss 331 et seq. (1976), allotted the whole Reservation in trust to individual Indians. About a third of the Reservation has by

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now gone out of trust, but a very substantial amount has remained in trust status. 3 The Government, through the Department of the Interior, has managed these tracts, selling the timber, handling the sale of individual allotments, and taking general care of the Indians' proceeds and monies from the tracts.

These suits accuse the defendant of various acts of mismanagement alleged to constitute breaches of trust for which the Government is liable. 4 Much was done in the cases after their filing in 1971--discovery, considerable preparation of experts' studies, a partial trial of three weeks duration, plans for further trials--without any challenge to this court's subject-matter jurisdiction. 5 However, after the partial trial in 1977 the defendant belatedly filed a motion to dismiss for lack of jurisdiction; the ground was that all the mismanagement claims in these cases rest on the theory of a breach of trust by the defendant and that this court does not have jurisdiction of such breach of trust claims. This is the motion which is now before us and which we consider. 6 We reject the Government's position and hold that the court properly has jurisdiction of these suits. 7


Our authority to entertain the actions is invoked under 28 U.S.C. s 1491 (1976) (insofar as the suits are by individual Indians) 8 and 28 U.S.C. s 1505 (1976) (actions by or on behalf of Indian tribes, bands or groups). 9 Defendant's first jurisdictional objection is that claims based on breach of trust are judge-made elaborations, unconnected with the Constitution, statutes, treaties, regulations, executive orders, or contracts--and therefore outside the congressional consents-to-sue embodied in sections 1491 and 1505. We skip (without passing upon) the grant of jurisdiction over claims against the United States 'for liquidated or

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unliquidated damages in cases not sounding in tort' 10 because here the Indians do not rest their case on unanchored judge-created principles of fiduciary law but point to and rely upon specific legislation as creating the trust relationship.

To sustain jurisdiction it is enough for us that the General Allotment Act, 25 U.S.C. ss 331 et seq. (1976), governing the tracts involved in these cases, expressly declares the fiduciary connection. Section 5, 25 U.S.C. s 348, states that the allotment-patents 'shall be of the legal effect, and declare that the United States does and will hold the land thus allotted, for the period of twenty-five years, in trust for the sole use and benefit of the Indian to whom such allotment shall have been made, or, in the case of his decease, of his heirs * * * and that at the expiration of said period the United States will convey the same by patent to said Indian, or his heirs as aforesaid, in fee, discharged of said trust and free of all charge or incumbrance whatsoever' (emphasis added). (The trust thus expressly established was extended first temporarily and then indefinitely by section 2 of the Indian Reorganization Act of 1934, 25 U.S.C. s 462 (1976).) 11

The next question is whether this statute can ground the money claims asserted here for breach of trust. We do not hesitate to hold that the congressional declaration of trust in the General Allotment Act 'can fairly be interpreted as mandating compensation by the Federal Government for the damage sustained' because of a proven breach of trust. See United States v. Testan, 424 U.S. 392, 400, 402, 96 S.Ct. 948, 955, 47 L.Ed.2d 114 (1976), citing Eastport S.S. Corp. v. United States, 372 F.2d 1002, 1009, 178 Ct.Cl. 599, 607 (1967). There is no requirement that Congress say expressly that damages can be recovered for breach of the trust. 12 That conclusion is the necessary inference from the statute. It is inconceivable. for instance, that Indian allotment-patentees whose lands were wholly wasted by the Government could not recover compensation in this court for such a violation of fiduciary obligation. No other remedy would exist since there is no administrative channel for obtaining compensation, and prospective judicial relief by way of injunction or mandamus (assuming such a remedy exists at all) would be meaningless for damage already done. 13 The same

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is true of lesser breaches of trust, leading to monetary injury which is shown to have been incurred. If there is no remedy under 28 U.S.C. sections 1491 and 1505, there is in effect no real redress at all for a departure from the standards Congress imposed on the Government in the General Allotment Act. Such a result, urged on us by the Government, is not compelled by that Act nor, in our view, would it be a correct interpretation. The trust language in the statute means that compensation can be recovered for a breach of trust provided that Congress has consented to suit on monetary claims, as it has in sections 1491 and 1505.

This is the stance we have consistently taken up to now in this kind of controversy. In Klamath & Modoc Tribes v. United States, 174 Ct.Cl. 483, 491--92 (1966), although we held that we could not order a general accounting at the outset, we emphasized at the same time that '(i)f, after a trial on the issue of liability, it is held that defendant has violated its statutory fiduciary obligations, it will be within the jurisdiction of the court to order the defendant in its capacity as a trustee to render an accounting for the purpose of enabling the court to determine the amount which plaintiffs are entitled to recover' (emphasis added), and that under sections 1491 and 1505 those Indian plaintiffs had 'a forum for the recovery of any damages to which they are entitled because of the Government's mishandling of tribal funds and property. No special jurisdictional act is required to provide that relief.' See also 174 Ct.Cl. at 490--91.

Similarly, in Mason v. United States, 461 F.2d 1364, 1374, 198 Ct.Cl. 599, 617 (1972), rev'd 412 U.S. 391, 93 S.Ct. 2202, 37 L.Ed.2d 22 (1973), the court said: 'A suit against the United States on behalf of the estate of a non-competent Indian, for damages compensating the estate for breach by the Government of its trust obligation under a federal statute, is within 28 U.S.C. s 1491 as a claim founded upon an Act of Congress and for damages 'in cases not sounding in tort.' The Osage Allotment Act implies that, if the Government breaches its trust duty to the pecuniary disadvantage of a non-competent Osage allottee, due compensation will be paid by the United States' (citing Eastport S.S. Corp. v. United States, 372 F.2d 1002, 178 Ct.Cl. 599 (1967), among other decisions). 14

There are also Indian cases in the same class which we have entertained with a somewhat briefer explanation of why we accepted jurisdiction. See Cheyenne-Arapaho Tribes v. United States, 512 F.2d 1390, 1392, 206 Ct.Cl. 340, 345 (1975); Fields v. United States, 423 F.2d 380, 383, 191 Ct.Cl. 191, 196 (1970); Capoeman v. United States, 440 F.2d 1002, 1002, 194 Ct.Cl. 664, 666 (1971); Quinault Allottee Ass'n v. United States, 485 F.2d 1391, 1392, 202 Ct.Cl. 625, 628 (1973), cert. denied, 416 U.S. 961, 94 S.Ct. 1980, 40 L.Ed.2d 312 (1974); Coast Indian Community v. United States, 550 F.2d 639, 652--53, 213 Ct.Cl. 129, 134, 152--53 (1977).

Our continued acceptance of Indian claims for breach of trust--where the existence of the trust obligation is founded on a statute, treaty, executive order or regulation, or an agreement--comports fully with the expectation of Congress that what is now 28 U.S.C. section 1505 (first enacted in 1946 as section 24 of the Indian Claims Commission Act, 60 Stat. 1055) would cover the post-1946 'legal' claims (i.e. other than purely 'moral' claims) of Indian entities 'so that it will never again be necessary to pass special Indian jurisdictional acts in order to permit the Indians to secure a court adjudication on any misappropriations of Indian funds or of any other Indian property by Federal officials that might occur in the future.' 92 Cong.Rec. 5313 (1946) (statement of then Congressman Jackson, committee chairman and principal sponsor

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of the Indian Claims Commission bill in the House of Representatives). See Klamath & Modoc Tribes v. United States, 174 Ct.Cl. 483, 488--89 (1966). 15 The...

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