Boller v. Key Bank of Wyoming

• Decision Date: 03 April 1992
• Docket Number: No. 90-240,90-240
• Citation: 829 P.2d 260
• Parties: Lewis Murray BOLLER, Jr., et al., Appellant (Defendant), v. KEY BANK OF WYOMING, Appellee (Plaintiff).
• Court: Wyoming Supreme Court

Page 260

829 P.2d 260

Lewis Murray BOLLER, Jr., et al., Appellant (Defendant), v. KEY BANK OF WYOMING, Appellee (Plaintiff).

No. 90-240.

Supreme Court of Wyoming.

April 3, 1992.

Philip Nicholas of Nicholas Law Office, Laramie, for appellant.

Richard Gist, of Richard D. Gist, P.C., Lander, for appellee.

Before THOMAS, MACY and GOLDEN, JJ., and ROONEY and BROWN, Ret. JJ.

ROONEY, Justice, Retired.

Appellant contends that the Indian Tribal Court, rather than the district court, had jurisdiction to foreclose a mortgage given by him, an enrolled Indian, on land within the exterior boundaries of the Wind River Indian Reservation which had been fee patented to him. He appeals from a summary judgment in which the district court held otherwise.

We affirm.

The principal issue in this case is worded by the appellant:

"Whether the District Court of Fremont County, Ninth Judicial District, has jurisdiction to foreclose the mortgage given by an enrolled Indian of Indian land located within the Wind River Indian Reservation."

And by appellee:

"Does the District Court, Fremont County, Wyoming, Ninth Judicial District, have the necessary and requisite jurisdiction to enter a money judgment against an Indian debtor and to foreclose a mortgage on, and order sold, fee patented land given as security for the repayment of the promissory note where the promissory note and mortgage were executed and performed off of the Wind River Indian Reservation but the fee patented land owned by the Indian debtor is located within the exterior boundaries of said Reservation?"

Appellee also presents the following issue for the purpose of limiting consideration of the "other issues":

"Whether, under the facts of this case, appellant's stipulation to judgment, as made to the trial court at the scheduling conference held May 8th, 1990, was dispositive of all issues except as to the issue of attorneys' fees and particularly that portion of the attorneys' fees which were incurred in pursuing the question of jurisdiction in this matter?"

The "other issues" are (without bracketed material as worded by appellant, and with such material as worded by appellee):

"Whether the record in this case permits the appellee to recover any interest on the debt in excess of the [minimum rate of] 12.25 percent per annum specified in the promissory note?

"Whether the record in this case permits the appellee to recover attorney's fees on the promissory note?

"Whether, under [the facts in this case and] the terms of the mortgage, appellee's acceleration of the mortgage debt, and foreclosure, are fatally premature because appellee failed, [by the record] to perform [certain] conditions precedent contained in the mortgage terms?

"Whether the record in this case permits the appellee to recover on summary judgment any attorney's fees on the foreclosure matter in excess of $1,000.00 [and] whether the [appellee] is entitled to recover any attorneys' fees which it incurred for litigation of the jurisdictional issue?

"Whether the mortgage secures the payment of any of appellee's attorney's fees?"

JURISDICTION

Appellant is an enrolled member of the Shoshone Indian Tribe. Appellee bank, located in Lander, Wyoming, and not on the Indian Reservation, loaned appellant $112,500. The loan was secured by a mortgage on appellant's home and ranch, which is located within the exterior boundaries of the Reservation but is no longer trust land. In 1978, the land was converted to fee patented land in the name of appellant under the Indian General Allotment Act of 1887 as amended (25 U.S.C. §§ 331-358). The Act provided, among other things, for the issuance of a fee patent for 160 acres of grazing land or 80 acres of agricultural land on a Reservation to an enrolled Indian upon application by him. Upon issuance of a fee patent, the trust status and all restrictions as to sale, encumbrance or taxation were removed from the land.

With reference to this Act, the United States Supreme Court has said: "The purpose of the allotment system was to protect the Indians' interest and 'to prepare the Indians to take their place as independent, qualified members of the modern body politic.' " Squire v. Capoeman, 351 U.S. 1, 9, 76 S.Ct. 611, 616, 100 L.Ed. 883 (1956) (quoting Board of Commissioners v. Seber, 318 U.S. 705, 715, 63 S.Ct. 920, 926, 87 L.Ed. 1094 (1943). "The purpose of the General Allotment Act of 1887, * * *, was to lay a foundation for integrating Indians into the mainstream of American society." Quinault Allottee Ass'n v. United States, 485 F.2d 1391, 1396, 202 Ct.Cl. 625 (1973) cert. denied, 416 U.S. 961, 94 S.Ct. 1980, 40 L.Ed.2d 312 (1974).

Appellant defaulted on the note and appellees accelerated the payment of the debt and brought this action to foreclose the mortgage and the accompanying security agreement. Appellant does not deny the debt, the obligation to repay it, or the mortgage. He contends that the exclusive jurisdiction to foreclose the mortgage was in the Indian Tribal Court.

The district court obtained personal jurisdiction over appellant through service of a copy of the complaint and summons on him and on his wife by the deputy sheriff of Fremont County at a place in Fremont County and not within the Reservation boundaries. Appellant and his non-Indian wife are separated. She signed the mortgage only to release homestead rights. She did not sign the note.

Appellant argues that, contrary to the specific language of the General Allotment Act, the United States Supreme Court has rejected the establishment of state court jurisdiction in matters involving fee patented land on Indian Reservations inasmuch as such would cause "checkerboard" jurisdiction, citing Moe v. The Confederated Salish and Kootenai Tribes of the Flathead Reservation, 425 U.S. 463, 96 S.Ct. 1634, 48 L.Ed.2d 96 (1976) and Brendale v. Confederate Tribes and Bands of Yakima Indian Nation, 492 U.S. 408, 109 S.Ct. 2994, 106 L.Ed.2d 343 (1989) in support of the argument.

In response, appellee properly notes that the Moe case dealt with trust property and not fee patented property, and that its holding "has been greatly undercut, if not abolished," by subsequent cases, including the Brendale case.

The latter case is a very recent case which involved whether State zoning regulations or tribal zoning regulations applied to fee patented lands on the Reservation. The Reservation had long been treated as divided into a "closed" area (predominantly forest land in the western portion) and an "open" area (predominantly range and agricultural land in the eastern portion). The Court differentiated between the two areas as follows:

"The closed area consists of the western two-thirds of the reservation and is predominantly forest land. Of the approximately 807,000 acres of land in the closed area, 740,000 acres are located in Yakima County. Twenty-five thousand acres of the seven hundred and forty thousand acres are fee land. The closed area is so named because it has been closed to the general public at least since 1972 when the Bureau of Indian Affairs restricted the use of federally maintained roads in the area to members of the Yakima Nation and to its permittees, who must be record landowners or associated with the Tribe. Access to the open area, as its name suggests, is not likewise restricted to the general public. The open area is primarily rangeland, agricultural land, and land used for residential and commercial development. Almost half of the land in the open area is fee land."

Brendale, 492 U.S. at 415-16, 109 S.Ct. at 3000 (footnote omitted).

Appellant's land and the surrounding area is similar to the area described in the Brendale case as the "open area." It and the surrounding area are used primarily for livestock grazing and rural homesites. Access to appellant's land from U.S. Highway 287 (approximately one mile) is entirely over fee patented land, part of which is a housing tract subdivision. Appellant's sale of 40 acres of his fee patented land was to a non-Indian.

Four members of the Brendale court held that both the "closed" area and the "open" area were subject to state zoning. Two of the other members held that the "open" area was subject to state zoning and that the "closed" area was subject to tribal regulations inasmuch as there was insufficient fee patented land in the "closed" portion to deprive the tribe of zoning authority over that portion. The three remaining justices would have given zoning authority over both portions to the tribe.

Four members of the Court set forth what was to be considered in determining whether the tribe or the state had jurisdiction over the use of fee patented land:

"[A]s we have indicated above, that interest does not entitle the tribe to complain or obtain relief against every use of fee land that has some adverse effect on the tribe. The impact must be demonstrably serious and must imperil the political integrity, the economic security, or the health and welfare of the tribe. This standard will sufficiently protect Indian tribes while at the same time avoiding undue interference with state sovereignty and providing the certainty needed by property owners."

Id. at 431, 109 S.Ct. at 3008. Nothing was here presented to reflect such impact.

Two of the six justices held that there was insufficient fee patented land in the "closed" portion to deprive the tribe of zoning authority over that portion. Tribal regulations were held to apply only when the state regulations would change the essential character of land being used exclusively for the benefit of the tribe. There is no indication here of a contemplated change in the essential character of appellant's land or of any land in the area. It is not now being used for any tribal benefit, let alone for use exclusively for such benefit.

Additionally, these two cases cited by appellant concern the use of the fee patented land. There is no indication here of a change in use. A change in use...