Board of Com'rs of Pawnee County, Okl. v. United States, 2719

• Decision Date: 26 November 1943
• Docket Number: 2726.,No. 2719,2719
• Citation: 139 F.2d 248
• Parties: BOARD OF COM'RS OF PAWNEE COUNTY, OKL., et al. v. UNITED STATES. UNITED STATES v. BOARD OF COM'RS OF PAWNEE COUNTY, OKL., et al.
• Court: U.S. Court of Appeals — Tenth Circuit

139 F.2d 248 (1943)

BOARD OF COM'RS OF PAWNEE COUNTY, OKL., et al. v. UNITED STATES.

UNITED STATES v. BOARD OF COM'RS OF PAWNEE COUNTY, OKL., et al.

Nos. 2719, 2726.

Circuit Court of Appeals, Tenth Circuit.

November 26, 1943.

Randell S. Cobb, of Oklahoma City, Okl. (L. N. Kimrey, of Pawnee, Okl., and Mac Q. Williamson and Horace Ballaine, both of Oklahoma City, Okl., on the brief), for appellants and cross-appellees.

Fred W. Smith, of Washington, D. C. (Norman M. Littell, of Washington, D. C., Whitfield Y. Mauzy, of Tulsa, Okl., and Vernon L. Wilkinson and Dwight D. Doty, both of Washington, D. C., on the brief), for appellee and cross-appellant.

Before PHILLIPS, HUXMAN, and MURRAH, Circuit Judges.

MURRAH, Circuit Judge.

The ultimate question presented by this appeal is whether certain lands held by the United States in trust for certain full-blood Pawnee Indians were exempt from Oklahoma ad valorem taxes by force of the Oklahoma Indian Welfare Act of June 26, 1936, 49 Stat. 1967, 25 U.S.C.A. § 501 et seq.

Colonel Moore, a full-blood restricted Pawnee Indian, was the owner of several tracts of restricted, but taxable, lands located in Pawnee County, Oklahoma, against which there were delinquent ad valorem taxes for the years 1937, 1938, and 1939. On October 19, 1939, Moore and his wife (also a full-blood Pawnee Indian), acting on the advice and with the consent of the Commissioner of Indian Affairs of the Department of Interior, by separate deeds, conveyed to the United States in trust for their three minor children, four separate tracts of lands located in Pawnee County, Oklahoma, and the deeds were thereafter approved by the Department of the Interior on August 7, 1940. No consideration passed for the conveyances, but the deeds were executed and delivered in pursuance of authority granted to the Secretary of the Interior by Section 1 of the Oklahoma Indian Welfare Act, which provides in part as follows: "That the Secretary of the Interior is hereby authorized, in his discretion, to acquire by purchase, relinquishment, gift, exchange, or assignment, any interest in lands, * * * including trust or otherwise restricted lands now in Indian ownership: Provided, That such lands shall be agricultural and grazing lands of good character and quality in proportion to the respective needs of the particular Indian or Indians for whom such purchases are made. Title to all lands so acquired shall be taken in the name of the United States, in trust for the tribe, band, group, or individual Indian for whose benefit such land is so acquired, and while the title thereto is held by the United States said lands shall be free from any and all taxes * * *."

Notwithstanding the conveyances to the government in the manner aforesaid, Pawnee County continued to assert the power to tax the lands in question, and did assess ad valorem taxes thereon for the taxable years 1940 and 1941, whereupon the United States brought this suit in the United States District Court for the Northern District of Oklahoma to declare the lands nontaxable; to cancel the ad valorem taxes already assessed for the taxable years 1940 and 1941, and to permanently enjoin the assessment and collection of ad valorem taxes, on the grounds that the lands became nontaxable by the State of Oklahoma for the taxable year 1940 and thereafter, under and by force of the Oklahoma Indian Welfare Act.

The trial court held the lands were acquired by the Secretary of the Interior in pursuance of the Act, and that the property so acquired became nontaxable on August 7, 1940, the date on which the deeds were approved by the Department of the Interior, and not on October 19, 1939, when the deeds were executed and delivered by the grantors, as contended by the government. Thus, the court specifically held that the lands were subject to state taxation for the taxable year 1940, and nontaxable for the year 1941 and thereafter. Pawnee County appeals from the judgment of the court holding the lands nontaxable and enjoining the assessment and collection of the taxes, from and after the taxable year 1941, while the United States has cross-appealed from that part of the judgment of the court holding the lands taxable for the year 1940, on the theory that the approval by the Department of the Interior on August 7, 1940 related back to the date of the execution and delivery of the deeds on October 19, 1939. Board of County Commissioners v. Seber, 10 Cir., 130 F.2d 663, affirmed 318 U.S. 705, 63 S.Ct. 920.

The jurisdiction of the trial court rests upon the provisions of Paragraph 1, Section 24 of the Judicial Code, 28 U.S.C.A. § 41(1), which provides in part that district courts shall have original jurisdiction of "all suits of a civil nature, at common law or in equity, brought by the United States, or by any officer thereof authorized by law to sue." The same paragraph also confers jurisdiction on the federal courts of suits brought by private citizens where the matter in controversy exceeds, exclusive of interest and costs, the sum or value of $3,000 and arises under the Constitution and laws of the United States, or is between citizens of different states with the requisite amount in controversy. The jurisdiction thus conferred has its source in Section 2, Article III of the Constitution of the United States, which provides that the judicial power of the United States shall extend to all controversies to which the United States is a party, and it extends to suits brought by the United States, either on its behalf, or as guardian to enforce a right or to protect the property of its Indian wards. McCarty v. Hollis, 10 Cir., 120 F.2d 540; Barnett v. United States, 9 Cir., 82 F.2d 765; Bryan County v. United States, 10 Cir., 123 F.2d 782, certiorari denied 315 U.S. 819, 62 S.Ct. 907, 86 L.Ed. 1216; Board of County Commissioners v. Seber, supra. But Pawnee County asserts that the Federal District Court was ousted of jurisdiction to enjoin the assessment and collection of the tax by the restrictive provisions of the Amendment of August 21, 1937, which amended Paragraph 1, Section 24 of the Code as follows: "Notwithstanding the foregoing provisions of this paragraph, no district court shall have jurisdiction of any suit to enjoin, suspend, or restrain the assessment, levy, or collection of any tax imposed by or pursuant to the laws of any State where a plain, speedy, and efficient remedy may be had at law or in equity in the courts of such State." Although the language used to restrict the federal court jurisdiction is broad and unequivocable, it does not by its terms specifically mention the United States, and it is seriously questioned whether the restrictive provisions of the Amendment were intended to apply to suits brought by the United States. Dollar Savings Bank v. United States, 19 Wall. 227, 239, 22 L.Ed. 80; United States v. American Bell Telephone Co., 159 U.S. 548, 554, 16 S.Ct. 69, 40 L.Ed. 255; United States v. Greene, 26 Fed.Cas. page 33, No. 15,258. Certainly the vice sought to be corrected by the legislation did not arise out of this class of cases, but was aimed at abuses arising out of injunction suits brought by private citizens, wherein federal court jurisdiction was based upon the requisite amount in controversy, "and arising under the Constitution and laws of the United States"; or was based purely upon the diversity of citizenship clause contained in the same paragraph of the Judicial Code. Senate Rep. 1035, 75th Congress; House Rep. 1503, 75th Congress.

We deem it unnecessary however to resolve this particular question, since we are convinced that a plain, speedy and efficient remedy at law or in equity in the courts of the state is not available to the United States. The remedies afforded for the abatement of taxes imposed by the State of Oklahoma, and which the County contends are plain, speedy, and efficient for the United States, are found in the Oklahoma Statutes which authorize the county boards of equalization "to cancel assessments of property not taxable * * *." Laws 1941, p. 323, Sec. 40, 68 O.S.A. § 15.40, and which authorized appeals from orders of the boards to the state district courts and Supreme Court. Laws 1941, p. 324, Sec. 42, 68 O.S.A. § 15.42. But the full payment of the taxes assessed against the property of any taxpayer, who has appealed from an order of the board of equalization, must be paid at the time and in the manner provided by law as a condition precedent to the appeal, Laws 1941, p. 326, Sec. 48, 68 O.S.A. § 15.48, and the remedy thus afforded is exclusive — "Equitable remedies shall be resorted to only where the aggrieved party has no taxable property within the tax district of which complaint is made." Laws 1941, p. 327, Sec. 49, 68 O.S.A. § 15.49. Flower Hospital v. Board of Equalization, Okl.Sup., 127 P.2d 177. Moreover, where the illegality of the tax is alleged to arise by reason of some action from which the laws provide no appeal, the aggrieved person shall pay the full amount of the tax at the time and in the manner provided by law, and shall bring suit to recover the amount so paid. Laws 1941, p. 327, Sec. 50, 68 O.S.A. § 15.50. Flower Hospital, Inc., v. Board of Equalization, supra; Black v. Geissler, 58 Okl. 335, 159 P. 1124; Duling v. First National Bank, 71 Okl. 98, 175 P. 554; Brown v. Hennessey State Bank, 78 Okl. 141, 189 P. 355.

It is not shown that any funds are available which could be lawfully used to pay the taxes under protest, if the Secretary were so authorized. It...