Board of County Com Rs of Creek County v. Seber

Decision Date19 April 1943
Docket NumberNo. 556,556
Citation87 L.Ed. 1094,63 S.Ct. 920,318 U.S. 705
PartiesBOARD OF COUNTY COM'RS OF CREEK COUNTY et al. v. SEBER et al
CourtU.S. Supreme Court

See 319 U.S. 782, 63 S.Ct. 1162, 87 L.Ed.

Messrs. Houston E. Hill and Mac Q. Williamson, both of Oklahoma City, Okl., for petitioners.

Mr. George H. Jennings, of Sapulpa, Okl., for respondents.

Mr. Warner W. Gardner, of Washington, D.C., for the United States, amicus curiae.

[Argument of Counsel from page 706 intentionally omitted] Mr. Justice MURPHY delivered the opinion of the Court.

This petition for certiorari presents the questions whether certain lands held by respondent Indians, subject to restrictions against alienation and encumbrance without the approval of the Secretary of the Interior, were exempt from Oklahoma real estate taxes for the year 1937 by virtue of the Act of June 20, 1936, 49 Stat. 1542;1 whether a portion of those lands were exempt for subsequent years by virtue of the Act of 1936 as amended by the Act of May 19, 1937, 50 Stat. 188, 25 U.S.C.A. § 412a;2 and whether the Acts of 1936 and 1937, so applied, are constitutional.

The facts are agreed. Prior to 1931 the Secretary of the Interior purchased three tracts of land, two rural and one urban, in Creek County, Oklahoma, for Wosey John Deere, an enrolled, full-blood member of the Creek Tribe of Indians. The purchase price was paid out of restricted royalties from an oil and gas lease of her restricted allot- ted land. She was given title subject to a condition against alienation or encumbrance without approval of the Secretary prior to April 26, 1931.3 Before that date, with the approval of the Secretary, she reserved a life estate and conveyed the fee to her children, full-blood but un-enrolled Creeks and respondents here, subject to a like condition against alienation or encumbrance without the approval of the Secretary with the exception that the restriction had no definite time limitation. On December 10, 1937, Wosey John Deere conveyed her life estate to respondents so that they became full owners subject to a restriction against alienation or encumbrance without the approval of the Secretary. Both conveyances were in consideration of love and affection. Thereafter, on December 16, 1937, respondents designated the two rural tracts, totalling eighty-seven and one-half acres, as a tax exempt homestead under the provisions of the Act of May 19, 1937, and the Secretary approved this designation on March 24, 1938.

Before the Act of June 20, 1936, the lands were subject to Oklahoma real estate taxes.4 Thereafter all three tracts were continued on the tax rolls of Creek County, and respondents, to avoid the accumulation of penalties and interest and a sale of the lands for taxes, paid the taxes for the years 1936, 1937, 1938, and part of 1939. On July 26, 1940, they filed this action in federal district court for the recovery of the 1936 and 1937 taxes paid on all three tracts, for the recovery of the 1938 and 1939 taxes paid on the two rural tracts designated as homestead lands, and for a declaration that the homestead lands were tax exempt. The district court gave judgment as prayed. 38 F.Supp. 731. The Circuit Court of Appeals affirmed for the most part but reversed with respect to the 1936 taxes on the ground that liability for them became fixed on the assessment date, January 1, 1936, before the enactment of the Act of June 20, 1936. Interest on the taxes paid was also disallowed. 130 F.2d 663. The importance of the case in the administration of Indian affairs and its impact upon state finances caused us to grant the County's petition for certiorari. Respondents have not cross-petitioned for review of the adverse decision on the 1936 taxes and the allowance of interest so it is unnecessary to consider those questions.

We hold that the 1936 Act extended tax immunity to all three tracts for the year 1937, that thereafter the 1937 Act exempted the designated homestead lands, and that both Acts, so applied, are constitutional.

Section 2 of the 1936 Act conditions tax immunity upon two requirements: (1) 'title' to the lands must be 'held by an Indian subject to restrictions against alienation or encumbrance except with the consent or approval of the Secretary of the Interior'; and, (2) the lands must have been 'heretofore purchased out of trust or restricted funds of said Indian'. Both requirements are met here with respect to all three tracts. These lands were purchased from the restricted royalties received from an oil and gas lease of the restricted allotted lands of Wosey John Deere, and, on the assessment day, January 1, 1937,5 she held title to a freehold life estate in all the parcels, subject to restrictions against alienation and encumbrance which were validly imposed by the Secretary of the Interior.6

Petitioners advance two arguments against the applicability of the 1936 Act. First they contend from remarks made by the sponsor of the 1936 Act in the Senate7 that the Act applied only to lands purchased for landless Indians, and thus did not extend to lands purchased from the restricted funds of Wosey John Deere, who held allotted land. We do not read those remarks as limiting the scope of the 1936 Act to landless Indians; they do not deal in terms of exclusiveness. But if they are to be interpreted as petitioners contend, we do not accept them as definitive because they are opposed to the clear words of the Act, the reasons for its enactment,8 its contemporary administrative interpretation,9 and its subsequent Congressional history.10 Secondly petitioners assert that the exemption of the 1936 Act was personal and extended only to lands the title to which was held by the Indian whose restricted funds were used to purchase the lands. This position finds some support in the language of the Act, referring to 'lands the title to which is now held by an Indian * * *, purchased out of trust or restricted funds of said Indian', but it is unnecessary to determine whether the purpose of Congress was such that the Act should be more broadly construed than its technical terms might indicate. For, even assuming arguendo that petitioners are correct in saying that the 1936 Act afforded only a personal exemption, Wosey John Deere, whose restricted funds purchased the three tracts, held a restricted life estate in each tract on January 1, 1937, the assessment date. As the life tenant she was obligated to pay the taxes under Oklahoma law. 60 Okl.Stat.Ann. § 69; Helm v. Belvin, 107 Okl. 214, 232 P. 382; Riley v. Collier, 111 Okl. 130, 238 P. 491; Waldon v. Baker, 184 Okl. 492, 495, 88 P.2d 352. Since the 1936 Act was concerned with a tax exemption, the proper test of whether an Indian purchaser had 'title' within the meaning of the Act must be whether he had retained such a property interest that, but for the Act, he would be subjected to the tax. Here Wosey John Deere retained such a title, and the three tracts were clearly within the 1936 Act even accepting petitioners' construction.

Likewise, the two rural parcels comply with the description contained in the 1937 Act which provides in part: 'All homesteads, heretofore purchased out of the trust or restricted funds of individual Indians * * * shall be nontaxable until otherwise directed by Congress: Provided, That the title to such homesteads shall be held subject to restrictions * * *.' Those parcels were purchased from the restricted funds of an individual Indian, Wosey John Deere, respondents hold them subject to valid restrictions,11 and they were properly designated by respondents as homestead lands on December 16, 1937, prior to the 1938 assessment date.12 In view of the legislative history of the 1937 Act, summarized in note 10 supra, petitioners' argument that the 1937 Act applies only to lands purchased for landless Indians must be rejected.

It has been suggested that the tax exemption granted by the 1937 Act is personal to the Indian whose restricted funds were used to purchase the land, or else that it extends to the land in the hands of restricted Creek Indian grantees only until 1956, consonantly with the statutes governing the tax status of restricted allotted lands of the Creeks.13 The Act does not say, however, and there is not a word to suggest that upon transfer of the lands to Indian heirs or grantees, subject to restrictions, the exemption is either to terminate or else extend only until 1956. If Congress had intended either result, it could easily have expressed those purposes. It did neither but provided instead that the lands while restricted were to remain nontaxable until it directed otherwise. In the absence of explicit Congressional direction we do not think we should hold the exemption personal or attempt to derive an applicable principle from the complicated and admittedly ambiguous statutes governing the tax status of restricted allotted Creek lands. Respondents received the land, which they have designated as a homestead, subject to restrictions of indefinite duration which the Secretary of the Interior had authority to impose.14 It seems only fair, as the clear words of the 1937 Act provide, that the tax exemption should follow the restrictions and continue so long as they do, unless Congress meanwhile provides to the contrary. Even if the 1937 Act were ambiguous, we think this interpretation should be taken. Cf. United States v. Reily, 290 U.S. 33, 39, 54 S.Ct. 41, 43, 78 L.Ed. 154.

It is argued, however, that the 1936 Act created only a personal exemption, and the 1937 Act gave no more because it was an amendment to the 1936 Act intended solely to limit the unnecessarily broad exemption of that Act. It is true that this was the avowed purpose of the 1937 Act,15 but it does not follow that the 1937 Act grants but a personal exemption or else allows the exemption only until 1956. While the question need not be decided, it is appropriate to notice that...

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