Littell v. Morton, Civ. A. No. 19917-W.

Citation369 F. Supp. 411
Decision Date14 January 1974
Docket NumberCiv. A. No. 19917-W.
PartiesNorman M. LITTELL v. Rogers C. B. MORTON, the Secretary of the Department of the Interior of the United States.
CourtUnited States District Courts. 4th Circuit. United States District Court (Maryland)

COPYRIGHT MATERIAL OMITTED

Marvin J. Sonosky, Washington, D. C., for plaintiff; Richard W. Case, Smith, Somerville & Case, Baltimore, Md., of counsel.

George Beall, U. S. Atty., D. Md., Baltimore, Md., Herbert Pittle, Dept. of Justice, Washington, D. C., for defendant.

WATKINS, Senior District Judge:

Plaintiff, Norman Littell, has sued defendant, the Secretary of the Interior, in the Secretary's official capacity as the trustee for the Navajo Tribe of Indians, for amounts claimed to be due under a contract plaintiff had with the Navajo Tribe for legal services. Jurisdiction is based upon 28 U.S.C. § 1331(a), 1391(e) (1970) and 5 U.S.C. § 704 (1970).

This case has followed a long and tortuous path before reaching the present stage, and a summary of the background of the dispute and earlier proceedings is important to an understanding of the issues now before this Court.

Plaintiff originally entered into a contract with the Navajo Tribe in 1947 to serve as both its general counsel and claims attorney. The initial contract terminated in 1957, at which time a new contract, to last an additional ten years, was entered into. Under the terms of this new contract, plaintiff was to continue in his dual capacity as general counsel and claims attorney. As general counsel for the Tribe plaintiff received a fixed fee for handling current and routine legal work. The contract also provided for assistant general counsel who were paid fixed salaries. In his capacity as claims attorney, the contract provided that plaintiff would be paid ten percent of any money or of the value of the property he "recovered, saved, or obtained" by preparing, investigating and prosecuting "claims . . . against the United States . . . relating to . . . lands which the United States is under obligation to make available" to the Navajo Tribe. To obtain compensation for any claims work, plaintiff was required to have prosecuted successfully the case. The provisions of the general counsel contract explicitly provided that the duties and functions of the assistant general counsel were not to include services related to claims. The statute governing Federal supervision of tribal activities required that such a contract be approved by the Secretary of the Interior in his capacity as overseer of tribal interests. 25 U.S.C. § 81 (1970). In compliance with this, the Secretary's approval was obtained.

Apparently plaintiff's relationship with the Tribe was cordial until early 1963. At that time a tribal election was held for the office of Tribal Chairman.1 A hotly contested campaign developed, and a part of the victorious candidate's platform had been the promise to remove Mr. Littell from his position as the Tribal attorney. The newly elected Chairman claimed Mr. Littell had been exerting too much influence on non-legal affairs of the Tribe, and that certain of Mr. Littell's activities had been improper and should be investigated.2

After his election, the new Chairman met an obstacle in fulfilling his pledge to remove Mr. Littell as Tribal attorney. The 1957 contract provided that the termination of the contract could be accomplished only by a majority vote of the Tribal council, and a majority of the Council's membership opposed termination of plaintiff's services. The Chairman took his problem and complaints to the then Secretary of the Interior. Following this meeting, the Chairman then had the Tribal Council's Advisory Committee (a committee hand-picked by the Chairman) adopt a resolution calling for the Secretary to investigate, audit and terminate the plaintiff's contract. The Secretary had his solicitor make a study of the records relating to plaintiff's contract with the Tribe. The solicitor determined the alleged "claim" of Healing v. Jones to be general counsel work; and, that attorneys for claims work were to be paid for by plaintiff, therefore any recovery plaintiff did receive from proper claims work should be set-off by the value of the work of general counsel used on such "claims". With this recommendation the Secretary called plaintiff to his office and requested that plaintiff resign as general counsel but retain his position as claims attorney.3 Plaintiff refused this suggestion. Based upon these events, the Secretary notified plaintiff, in November of 1963, that the general counsel contract would be terminated unless plaintiff adduced evidence refuting the charges that he had been guilty of misconduct in his relations with the Tribe.

Plaintiff did not reply but obtained from the United States District Court for the District of Columbia a preliminary injunction barring any interference with his general counsel contract pending the outcome of the litigation and this was upheld by the Court of Appeals for the District of Columbia Circuit. 119 U.S.App.D.C. 197, 338 F.2d 537 (1964). The suit was tried on the merits and as a result the court, by Judge Sirica, made 118 findings of fact and granted a permanent injunction. 242 F.Supp. 635 (D.C.D.C.1965). The District Court held that the Secretary lacked authority to terminate plaintiff's contract. Among the findings, however, was the finding that plaintiff had "sometimes used and condoned the use of general counsel attorneys on claims litigation." 242 F.Supp. at 660, Fdg. 59. In connection with this finding, Judge Sirica stressed that this use of general counsel had not been with an evil intent and was often unavoidable.4 Based upon this one finding, the Circuit Court of Appeals for the District of Columbia Circuit, reversed the lower court, and held that the use of tribal staff attorneys on claims cases in violation of the contract constituted a breach adequate for the cancellation of the general counsel contract. 125 U.S.App.D.C. 89, 366 F.2d 668 (1966), cert. den., 385 U.S. 1007, 87 S.Ct. 713, 17 L.Ed.2d 545 (1967).

Plaintiff next filed a claim for compensation with the Secretary seeking payment for services as general counsel for a period prior to the final determination of his injunctive litigation and seeking his contingent fee with respect to certain "claims" cases in which he had allegedly obtained a substantial benefit for the Tribe. The Secretary denied plaintiff's claim for payment for services as general counsel ruling that the contract had been terminated as of December, 1963, so that plaintiff was not entitled to payment for services rendered thereafter. As for the "claims" cases the Secretary ruled that several of these were not claims at all and the remainder, although claims, were not to be paid on the ground plaintiff had breached his fiduciary duty to the Tribe, thereby forfeiting his right to a fee.

Plaintiff then instituted his action in this Court.5 The following amounts are claimed by plaintiff:

(1) the sum of $18,023.70, representing the amount remaining due for services and expenses rendered under plaintiff's former general counsel contract with the Navajo Tribe;
(2) the sum of $25,009.76 with interest, representing fees earned by plaintiff for representing the Navajo Tribe in what is referred to as the Helium Case;
(3) ten percent of the value of two million acres of land, which plaintiff alleges were recovered for the Navajo in the case of Healing v. Jones; and
(4) in the event of ultimate success in a proceeding still pending before the Department of the Interior, Utah 030009, plaintiff's proportionate share of ten percent of the value of the land which may be recovered.

Defendant alleges that plaintiff forfeited any claim to further fees of any kind by virtue of his breach of trust, and defendant affirmatively denies that Healing v. Jones and Utah 030009 were "claims" under the provisions of plaintiff's contract. Additionally, defendant counterclaims for the value of the services of general counsel used on claims work in contravention of the terms of the contract, and for $104,398.19, representing installment payments, made by defendant to plaintiff, under the general counsel contract from the time of the preliminary injunction until the permanent injunction was dissolved.

A substantial portion of this case involves a review of an administrative decision under the Administrative Procedure Act. 5 U.S.C. § 701 et seq. (1970). The APA limits the scope of judicial review a court may make of an administrative determination. The courts are not to "interfere with administrative determinations unless, upon the record, the proceedings were manifestly unfair, or substantial evidence to support the administrative finding is lacking, or error of law has been committed, or the evidence reflects a manifest abuse of discretion." United States ex rel. Rongetti v. Neelly, 207 F.2d 281, 284 (7 Cir. 1953). The specific application and effect of this limited review upon the instant action will be discussed at length near the conclusion of this opinion.

I RELIEF SOUGHT

The initial problem to be faced in determining the merits of this suit, is whether the three litigative actions, in which plaintiff represented the Navajo Tribe, were "claims" cases, and, if so, is plaintiff entitled to recover on them. The first of these, Navajo Tribe of Indians v. United States, 364 F.2d 320, 176 Ct.Cl. 502 (1966) the Helium Case, is conceded to be a claims case and plaintiff would be entitled to his $25,009.76 contingency fee if no outstanding claims by defendant existed. However, in the remaining two actions defendant denies that they are "claims" as defined by the Attorney Contract. The answer to this principally revolves around the wording of the contract. As contained within the contract, the duties of the claims counsel were:

to investigate and formulate any and all claims of the said Indians against the United States and officers thereof, including claims arising out of
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