Kennerly v. United States

• Decision Date: 10 February 1982
• Docket Number: No. CV-81-3-GF.,CV-81-3-GF.
• Citation: 534 F. Supp. 269
• Parties: Leo KENNERLY, Sr., et al., Plaintiffs, v. UNITED STATES of America, et al., Defendants.
• Court: U.S. District Court — District of Montana

534 F. Supp. 269

Leo KENNERLY, Sr., et al., Plaintiffs, v. UNITED STATES of America, et al., Defendants.

No. CV-81-3-GF.

United States District Court, D. Montana, Great Falls Division.

February 10, 1982.

Steven L. Bunch, Montana Legal Services Ass'n, Helena, Mont., for plaintiffs.

Phil Roy, Browning, Mont., Robert T. O'Leary, U. S. Atty., Billings, Mont., Jeanne S. Whiteing, Kurt V. Blue Dog, Richard B. Collins, Native American Rights Fund, Boulder, Colo., for defendants.

MEMORANDUM

HATFIELD, District Judge.

Plaintiff,¹ Leo Kennerly, Sr., filed a complaint commencing this action in federal district court on January 9, 1981, alleging jurisdiction under 28 U.S.C. §§ 1331, 1337, 1343(4), 1353, 1361, and 25 U.S.C. § 345. Plaintiff exhausted all administrative remedies prior to filing the complaint. Hence, this court is authorized to judicially review the decision of the Interior Board of Indian Appeals hereinafter "IBIA", which spawned the pending litigation, pursuant to 28 U.S.C. § 1331(a). Andrus v. Charleston Stone Prods. Co., 436 U.S. 604, 607 n.6, 98 S.Ct. 2002, 2004 n.6, 56 L.Ed.2d 570 (1978).²

The United States, together with the Secretary of the Interior³ and the present and former superintendents of the Blackfeet Agency hereinafter "federal defendants", have filed a motion for partial summary judgment. The Blackfeet Tribe and the members of the Blackfeet Tribal Credit Committee hereinafter "tribal defendants", have filed a motion to dismiss.⁴ All briefs have been submitted and reviewed, and oral argument was held on December 18, 1981. Accordingly, the matter is now ripe for disposition.

After due consideration, this court has concluded that the decision of the IBIA passes muster under judicial review, and that jurisdiction is lacking for the court to grant the plaintiff's claims for equitable relief and money damages against the tribal defendants. Therefore, the court holds that the motion for partial summary judgment, filed by the federal defendants, and the motion to dismiss, filed by the tribal defendants, are hereby granted.⁵

I. STATEMENT OF FACTS

At the time of his death, the plaintiff was an enrolled member of the Blackfeet Tribe of the Blackfeet Indian Reservation. Plaintiff owned interests in parcels of land pursuant to the General Allotment Act, 25 U.S.C. §§ 331, et seq., and the Blackfeet Allotment Act, Act of June 30, 1919, c.4, § 10, 41 Stat. 16, as amended by Act of June 4, 1953, c.99, § 1, 67 Stat. 42. These lands were leased on behalf of the plaintiff by the Bureau of Indian Affairs hereinafter "B.I.A.". The income generated by the leases was collected and held for the plaintiff in an Individual Indian Money Account hereinafter "I.I.M. Account" administered by the B.I.A. As an allottee, the plaintiff was eligible to apply for and receive the money in his I.I.M. Account.

The Blackfeet Tribe has a loan fund from which members may borrow money from the tribe. Between 1943 and 1957, the plaintiff received several loans for varying amounts from the Blackfeet Tribe. Some of the loans were secured, others were not.

On February 1, 1944, the plaintiff executed an assignment of income and power of attorney from his I.I.M. Account at the Blackfeet Agency to the Blackfeet Tribe, in the amount of $200.⁶ On July 7, 1947, the plaintiff executed an assignment of income to the Blackfeet Tribe in the amount of $105.50; a $3,300 assignment was made by the plaintiff on September 22, 1949, followed by a $100 assignment on March 13, 1950.⁷

Until 1977, there was no activity on the plaintiff's I.I.M. Account. Then, on March 10, 1977, the Blackfeet Tribal Credit Committee sent a letter to the plaintiff, stating the amount owed on his tribal loans and informed him: "If you do not want your lease income held, please make other satisfactory arrangements."

Two months later, in May 1977, the plaintiff had failed to make other arrangements. Accordingly, the Blackfeet Tribal Credit Committee, acting pursuant to an amended tribal ordinance,⁸ presented to the Blackfeet Agency of the B.I.A. the assignments of income executed by the plaintiff for payment from his I.I.M. Account. Payments from that account began in May 1977.

Plaintiff protested these payments and subsequently entered into negotiations with the Blackfeet Tribe and the Blackfeet Agency Superintendent.⁹ During the period of negotiations, from November 1977 until January 1979, payments from the plaintiff's I.I.M. Account to the Blackfeet Tribe were suspended.

On January 23, 1979, the Superintendent of the Blackfeet Agency authorized 20% of the income from the plaintiff's I.I.M. Account to be paid to the Blackfeet Tribe. This authorization followed a determination by the Billings Area Field Solicitor for the Department of the Interior¹⁰ that 25 C.F.R. § 104.9 permitted funds of individual Indians to be applied by the Secretary of the Interior or his authorized representative against claims of indebtedness to the tribe of which the individual is a member, unless prohibited by Congress.¹¹

On April 12, 1979, the plaintiff sought relief from the Superintendent's action by appeal to the Billings Area Director of the B.I.A. On May 24, 1979, the Area Director issued a written decision upholding the Superintendent's authorization. Plaintiff then appealed to the Commissioner of Indian Affairs, who transferred the appeal to the IBIA pursuant to 25 C.F.R. § 2.19(a)(2).

In its July 8, 1980 decision, the IBIA upheld as effective the $105.50 assignment of income executed by the plaintiff on July 7, 1947. The IBIA concluded that the assignment was properly approved by an authorized representative of the Secretary of the Interior, and was therefore valid under 25 C.F.R. § 104.9. The remaining assignments of income, executed on February 1, 1944, September 22, 1949, and March 13, 1950, were remanded to the Billings Area Director of the B.I.A. for a determination of whether those assignments and the balance of the account claimed by the Blackfeet Tribe were approved as required by regulation. Kennerly v. Billings Area Director, Bureau of Indian Affairs, 8 IBIA 106 (1980).

After traversing the administrative appeals route,¹² the plaintiff sought review in this court, challenging the decision handed down by the IBIA and seeking equitable relief and money damages from the defendants. For the named plaintiff and the plaintiff class, the complaint seeks a preliminary and permanent injunction and/or writ of mandamus prohibiting attachment of I.I.M. Accounts, and a declaratory judgment stating that the defendants violated the due process and just compensation clauses of the Fifth Amendment, plus applicable federal statutes and fiduciary obligations owed to the plaintiff and the plaintiff class in the administration of I.I.M. Accounts. The complaint also seeks a ruling that 25 C.F.R. § 104.9 is an unconstitutional violation of due process under the Fifth Amendment.

For the named plaintiff, the complaint seeks a judgment requiring the defendants to return the money purloined from the I.I.M. Account, together with damages for the use value of the money during the period it was wrongfully withheld. The complaint further seeks an award of damages, including punitive damages, against all the defendants except the United States.

II. CONTENTIONS OF THE PARTIES

A. Federal Defendants

The federal defendants contend that the present action is a review of the factual determinations made by the IBIA, and that the proper standard of review is whether those factual determinations are "unsupported by substantial evidence." 5 U.S.C. § 706(2)(E). United States v. Wharton, 514 F.2d 406, 409 (9th Cir. 1975). The federal defendants further contend that the plaintiff received adequate due process both prior to and after the attachment of income from his I.I.M. Account in the form of negotiations and administrative review. Finally, the federal defendants argue that their actions in applying money from the plaintiff's I.I.M. Account towards the satisfaction of his tribal loans, pursuant to the assignments of income, were lawful under 25 C.F.R. § 104.9.

B. Tribal Defendants

The tribal defendants argue that the Blackfeet Tribe is immune from suit and must therefore be dismissed.

With respect to the claims for equitable relief and money damages against the tribal agents for violations of the Fifth Amendment, the tribal defendants assert that no federal cause of action has been alleged and that such claims must also be dismissed. This assertion is founded upon the proposition that the Fifth Amendment to the United States Constitution does not restrict governmental actions of the tribe, citing Talton v. Mayes, 163 U.S. 376, 16 S.Ct. 986, 41 L.Ed. 196 (1896). In support of this proposition, the tribal defendants argue that Congress has imposed a due process limitation on tribes by statute in the form of the Indian Civil Rights Act hereinafter "ICRA", 25 U.S.C. § 1302(8). The United States Supreme Court has construed the ICRA as being enforceable in federal court only for a writ of habeas corpus. Santa Clara Pueblo v. Martinez, 436 U.S. 49, 98 S.Ct. 1670, 56 L.Ed.2d 106 (1978).

The tribal defendants finally contend that the tribal agents are being sued for actions taken in their official capacities and within the scope of their tribal authority; thus, any claims asserted by the plaintiff against the tribal agents for money damages are barred by the Blackfeet Tribe's immunity from suit, citing Edelman v. Jordan, 415 U.S. 651, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974) and Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 69 S.Ct. 1457, 93 L.Ed. 1628 (1949), and must be dismissed.

C. Plaintiff

Plaintiff disagrees with the contentions advanced by both the federal and tribal defendants. The essence of the plaintiff's argument is that both defendants violated the due process clause of the Fifth Amendment by not providing proper notice or a meaningful opportunity to be heard prior to...