Grondal v. United States
| Citation | 21 F.4th 1140 |
| Decision Date | 30 December 2021 |
| Docket Number | No. 20-35694,20-35694 |
| Parties | Paul GRONDAL, a Washington resident; Mill Bay Members Association, Inc., a Washington non-profit corporation Plaintiffs-Appellants, v. UNITED STATES of America; U.S. Department of the Interior ; Bureau of Indian Affairs; Confederated Tribes of the Colville Reservation, Defendants-Appellees, v. Wapato Heritage LLC; Gary Reyes, Defendants-Appellants, and Francis Abraham; Paul G. Wapato, Jr.; Kathleen Dick; Deborah Backwell; Catherine Garrison ; Mary Jo Garrison; Enid T. Wippel; Leonard Wapato; Annie Wapato; Judy Zunie; Jeffrey M. Condon; Vivian Pierre; Sonia W. Vanwoerkom; Arthur Dick; Hannah Rae Dick; Francis J. Reyes; Lynn K. Benson; James Abraham; Randy Marcellay; Paul G. Wapato, Jr.; Catherine L. Garrison; Maureen M. Marcellay; Leonard M. Wapato; Mike Marcellay; Linda Saint ; Stephen Wapato; Marlene Marcellay; Dwane Dick; Gabe Marcellay; Travis E. Dick; Hannah Dick; Jacqueline L. Wapato; Darlene Marcellay-Hyland; Enid T. Marchand; Lydia A. Arneecher; Gabriel Marcellay; Mike Palmer; Sandra Covington, Defendants. |
| Court | United States Courts of Appeals. United States Court of Appeals (9th Circuit) |
Sally W. Harmeling (argued), Robert R. Siderius, Jacob M. Knutson, and Joseph Q. Ridgeway, Jeffers, Danielson, Sonn & Aylward, P.S., Wenatchee, Washington, for Plaintiffs-Appellants Paul Grondal and Mill Bay Members Association, Inc.
Nathan Arnold (argued), Bruce Johnston, Emanuel Jacobowitz, Cloutier Arnold & Jacobowitz PLLC, Seattle, Washington; Tyler D. Hotchkiss and Dale M. Foreman, Foreman, Hotchkiss, Bauscher & Zimmerman, PLLC, Wenatchee, Washington; for Defendant-Appellant Wapato Heritage, LLC.
Manish Borde (argued), Borde Law PLLC, Seattle, Washington, for Defendant-Appellant Gary Reyes.
Joseph P. Derrig (argued), Assistant United States Attorney; Joseph H. Harrington, Acting United States Attorney; United States Attorney's Office, Spokane, Washington; Jean E. Williams, Acting Assistant Attorney General; John L. Smeltzer, Attorney; Environment & Natural Resources Division, United States Department of Justice, Washington, D.C.; for Defendants-Appellees United States of America, United States Department of the Interior, and Bureau of Indian Affairs.
Brian W. Chestnut (argued), Brian C. Gruber, and Anna E. Brady, Ziontz Chestnut, Seattle, Washington, for Defendant-Appellee the Confederated Tribes of the Colville Reservation.
Before: Carlos T. Bea, Daniel A. Bress, and Lawrence VanDyke, Circuit Judges.
Decades ago, a group of recreational vehicle ("RV") owners purchased fifty-year memberships to a lakeside RV park. But as it turns out, the park's management had validly leased the park's land from its landowners for only twenty-five years. This case embodies the efforts of those RV owners to maintain access to their vacation getaway after the end of the twenty-five-year lease term. Complicating matters, the land in question is American Indian land: It is fractionally owned by the heirs of American Indian Wapato John and is currently held in trust by the United States' Bureau of Indian Affairs ("BIA"), although that trust status is very much in dispute.
In the litigation below, the RV owners sued to retain their rights to remain on the RV park through 2034; the BIA is a defendant by dint of its now-challenged status as trustee of the at-issue land. But once sued, the BIA quickly took the offensive with a counterclaim for trespass and ejectment against the RV owners who have admittedly continued to possess the RV park, even after the lease expired.
In this appeal, we consider the district court's grant of the BIA's motion for summary judgment on that counterclaim. To rule, we must delve into the 19th-century origins of Wapato John's trust land; interpret 20th-century executive orders and treaties; apply 21st-century estate statutes; and consider the barrage of legal arguments presented to us. After considering all that, and more, we affirm.
Moses Allotment Number 8 ("MA-8") is a plot of land in eastern Washington; the RV park is on that land. In the 1900s, the United States originally issued title to this land to American Indian Wapato John, a member of the Moses Band of the Columbia Tribe, as an "allotment" in trust: a distinct plot of land set aside for Wapato John. According to the federal statute establishing this particular trust, the land's legal title vested in the United States, which was to hold the land in trust for ten years for Wapato John's sole use and benefit. The land's beneficial title (i.e. , the land's equitable title) vested in Wapato John. During the ten-year trust period, the land was to be managed by the Department of the Interior (now the BIA) and was subject to restrictions on alienation, encumbrance, and state taxation. That trust period for MA-8 has been repeatedly extended over the years (and these trust extensions correspondingly extended the restrictions as well) such that to this day, the United States continues to hold legal title to the land, in trust for Wapato John's heirs.
Today, beneficial ownership in MA-8 is rather fractionated. Twenty-seven heirs of Wapato John—here, referred to as the individual allottees ("IAs")—own separate, undivided beneficial interests in the land. Wapato Heritage, LLC ("Wapato Heritage") and the Confederated Tribes of the Colville Reservation (the "Tribe") also hold undivided, beneficial interests in MA-8.1 The BIA retains legal title as trustee to all such beneficial interests held by the IAs, Wapato Heritage, and the Tribe.
Throughout most of 20th century, MA-8 was left unimproved. But in 1979, William Wapato Evans, Jr. (an heir of Wapato John and then-holder of an approximately 5% beneficial interest in MA-8) sought to improve MA-8 and thereby generate income for himself and the other IAs. At that time, the IAs between them owned the vast majority of the beneficial interest in MA-8, and per BIA regulation, Evans obtained approval from a majority of those IA interests to lease the entirety of MA-8 to develop a recreational vehicle park (the "Mill Bay RV Park"). With approvals in hand, Evans negotiated and signed the "Master Lease."2
Under the terms of the Master Lease, signed in 1984, the IAs leased use of MA-8 to Evans for a term of twenty-five years, but Evans retained an option to renew the lease for another twenty-five years. To exercise this option, the Master Lease required Evans to provide written notice to both the Lessors (the IAs) and the BIA twelve months prior to the expiration of the original twenty-five-year term. The Master Lease permitted Evans to sublease the property upon written approval of the BIA and provided that such subleases would be assigned to the Lessors, rather than cancelled, if the Master Lease itself was terminated "by cancellation or otherwise." Evans subleased most of MA-8 to his corporation, Mar-Lu, Ltd.3 He also subleased a portion of MA-8 to a development corporation owned by the Tribe for the operation of a casino.
Thereafter, Evans, through Mar-Lu, developed and sold "regular memberships" to the Mill Bay RV Park. These "regular memberships" allowed purchasers to use and park their vehicles on the RV park on a first-come, first-served basis under the site plan of the Master Lease.4 Later, in 1989, Evans obtained approval from the BIA to modify the site plan so that Evans could sell "expanded membership[s]." These expanded memberships, expressly subject to the terms of the Master Lease, granted members the "right to use" the Mill Bay RV Park and guaranteed them each a designated spot in the RV park.
Two earlier lawsuits are relevant to this one. First is the Grondal state court litigation between Evans and some of the RV owners who had purchased regular or expanded memberships at his park. By 2001, the Mill Bay RV Park was losing money fast, and Evans notified RV owners who had purchased either a regular membership or an expanded membership that he would be closing the park. Some of those members—Paul Grondal and the Mill Bay Members Association, Inc. ("Mill Bay")—sued in Washington state court to prevent the park closure.5 Evans died during the pendency of the litigation, at which point much of his assets were distributed by will to his company Wapato Heritage, including his rights under the Master Lease. The personal representative for Evans' estate requested mediation of the Grondal state litigation.
At mediation, the parties settled and executed the 2004 Settlement Agreement, ultimately deciding that the RV park would not be closed. The BIA was not named a party to the litigation and did not intervene as a party to the action; the BIA attended the mediation at the request of the parties but did not participate. Under the terms of the 2004 Settlement Agreement, Mill Bay and Wapato Heritage agreed that Mill Bay would have the right, subject to compliance with the Master Lease, to continued use of the Mill Bay RV Park through 2034. But it turned out that the Master Lease would not last near that long.
The second lawsuit was a federal court case concerning the Master Lease, which eventually reached this Court. Back in 1985, and shortly after signing the Master Lease, Evans had sent a letter to the BIA purporting to exercise the option to renew the Master Lease for 25 years through 2034. All parties to the Master Lease, as well as non-party the BIA, apparently assumed for the next twenty-two years that Evans' letter was sufficient to exercise that option. The BIA never corrected Evans' or Mill Bay's understanding that the Mill Bay RV Park was properly leased through 2034, and Mill Bay made significant financial expenditures and commitments based on that understanding.
Upon later investigation, however, the BIA came to believe that Evans' letter was insufficient. Recall that per the Master Lease, Evans could renew only by giving notice to both "the Lessor"—the MA-8 IAs—and to the BIA. But Evans...
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