Tetlin Native Corp. v. State

• Citation: 759 P.2d 528
• Decision Date: 29 July 1988
• Docket Number: No. S-2265,S-2265
• Parties: TETLIN NATIVE CORPORATION, Appellant, v. STATE of Alaska, Richard Knapp, Commissioner of the Alaska Department of Transportation and Public Facilities and Mat-Su, Inc., Appellees.
• Court: Supreme Court of Alaska (US)

Page 528

759 P.2d 528

TETLIN NATIVE CORPORATION, Appellant, v. STATE of Alaska, Richard Knapp, Commissioner of the Alaska

Department of Transportation and Public Facilities

and Mat-Su, Inc., Appellees.

No. S-2265.

Supreme Court of Alaska.

July 29, 1988.

Frederick H. Boness, Preston, Thorgrimson, Ellis & Holman, Anchorage, for appellant.

E. John Athens, Jr., Asst. Atty. Gen., Fairbanks, Grace Berg Schaible, Atty. Gen., Juneau, for appellees.

Before MATTHEWS, C.J., and RABINOWITZ, BURKE, COMPTON and MOORE, JJ.

OPINION

COMPTON, Justice.

This appeal concerns five material site easements located within land owned by the Tetlin Native Corporation (Tetlin). The land was conveyed to Tetlin pursuant to § 19(b) of the Alaska Native Claims Settlement Act (ANCSA). 43 U.S.C. § 1618(b) (1982). On cross-motions for summary judgment, the trial court ruled in favor of the State of Alaska. We affirm.

I. FACTUAL AND PROCEDURAL BACKGROUND

Shortly after statehood the State of Alaska (State) proceeded to obtain interests to material site easements or rights-of-way across land held by the United States government. The material site easements are a source of sand and gravel for highway construction and maintenance. In 1960 the State applied to the Bureau of Land Management (BLM) for two material site easements located within the boundaries of the Tetlin Indian Reserve. ¹

The BLM granted to the State one material site easement, stating its authority to grant the request was "found in regulations from 43 C.F.R. 244.54(a)(1) and Section 17 of the Federal-Aid Highway Act of November 9, 1921, (42 Stat. 216, 23 U.S.C. 18)." ² Several months later, on October 4, 1961, the BLM issued a decision rejecting the other application on the grounds that the BLM lacked jurisdiction to approve a "right-of-way entirely within an Indian Reservation." ³ BLM advised the State to file an application with the Bureau of Indian Affairs (BIA) or appeal to the Director of the BLM. The State did not appeal the BLM decision. Instead, in early 1963 it applied to the BIA for the five material site easements in question. One of the five material sites was the same site which had been rejected by the BLM in 1961.

As part of the BIA application process, on August 6, 1963, the Tetlin Native Council ⁴ consented by resolution "to the jurisdictional transfer of the necessary material pits for the construction and improvement of the Alaska Highway by and through the Bureau of Indian Affairs Realty Office...." The State was assessed $1,473.48 as compensation for these material sites. The BIA approved this compensation as being "just and adequate." In 1964 the BIA formally granted the State's request for the five material sites pursuant to 25 U.S.C. § 323 (1982) ⁵ and 25 C.F.R part 161 (1958). ⁶

In 1971, Congress passed the Alaska Native Claims Settlement Act, Pub.L. No. 92-203, 85 Stat. 688 (codified as amended at 43 U.S.C. §§ 1601-1629a (1982)) (ANCSA). Section 19(a) of ANCSA revoked the Executive Order creating the Tetlin Reserve (among others) while Section 19(b) allowed village corporations to elect to receive fee simple title to their former reserves in lieu of other benefits from ANCSA. 43 U.S.C. § 1618(a), (b) (1982). Tetlin Native Corporation was incorporated in July 1973 and elected to receive fee simple title to its former reserve and forego participation in the monetary settlement authorized by ANCSA.

In early 1980 the BLM released for comment a draft decision determining lands available for conveyance to Tetlin. The draft decision provided that the grant of the former reserve would be subject to the five BIA material site easements at issue as well as four material site easements granted by the BLM.

Shortly after the draft decision was released the director of the BLM for Alaska wrote to the regional solicitor asking for an opinion on the validity of the five BIA material site easements identified in the draft decision. The solicitor informed the director that the five material sites granted to the State by the BIA were invalid. The solicitor reasoned that: "[s]ince Tetlin is not an Indian Reservation, the jurisdiction to dispose of gravel is under the BLM. The provisions of 43 C.F.R. § 2802.1-6 [ (1979) ] giving BIA jurisdiction over rights-of-way on 'Indian [lands]' and of 25 C.F.R. § 161.3 [ (1979) ] do not apply in this case."

On September 30, 1980, the BLM issued its final decision conveying to Tetlin approximately 743,000 acres of land. The final decision deleted reference to the five material site easements granted to the State by the BIA. Although the final decision no longer made the grant specifically subject to the five material sites, it did contain a general savings clause for valid existing rights. ⁷

In accordance with Department of Interior regulation 43 C.F.R. 2650.7 (1980), the final decision expressly stated that:

Any party claiming a property interest in lands affected by this decision, an agency of the Federal government, or regional corporation may appeal the decision to the Alaska Native Claims Appeal Board, ...

....

Any party known or unknown who is adversely affected by this decision shall be deemed to have waived those rights which were adversely affected unless an appeal is timely filed with the Alaska Native Claims Appeal Board.

Neither the State nor Tetlin appealed any issue relating to the BIA material sites. On May 18, 1981, the Secretary of the Interior conveyed by patent to Tetlin the surface and subsurface estates to the lands identified in the final decision.

Sometime after the patent was issued the State informed Tetlin that the State claimed all the right, title and interest to the five BIA issued material site easements. Tetlin filed suit to challenge the State's claim to the material site easements. Among other things, Tetlin's complaint sought declaratory relief that the State had no right, title or interest in the five BIA material sites. Both parties moved for summary judgment on this issue.

The trial court granted summary judgment in favor of the State and denied Tetlin's cross-motion for partial summary judgment. The court first determined that "[t]he State's failure to appeal the [BLM final decision] does not preclude the State from now insisting that its claim is valid." Upon reaching the merits the court concluded: "The material site grants were valid. The blanket reservation of valid pre-existing rights preserved the material sites for the State." Tetlin appeals.

II. DISCUSSION

A. THE STATE DID NOT WAIVE ITS RIGHT TO CLAIM AN INTEREST IN THE MATERIAL SITE EASEMENTS.

At the outset we note the issues raised in this case involve questions of law which we review de novo. Alaska Sales and Serv. Inc. v. Millet, 735 P.2d 743, 745 (Alaska 1987). Tetlin argues that the State may not now assert its claim to the easements because it did not appeal the BLM's decision which omitted the five material site easements from the final decision and patent. Tetlin argues that during the conveyance process the BLM adjudicated the validity of the BIA material site easements, and found them invalid. This is so, reasons Tetlin, because the draft decision referred to the material sites, a BLM solicitor opined that the easements were invalid, and the final decision did not refer to the easements.

The State argues that a brief memorandum by the solicitor is not an adjudication of the easements. Moreover, the State points out that it did not receive the solicitor's opinion, and that the BLM did not necessarily take the solicitor's advice because the final decision did not specifically cancel the material site easements. The State argues that the BLM's failure to adjudicate the sites does not translate into a waiver by the State of all rights to the sites. The State contends that the title conveyed by the patent remains subject to the material site until it is specifically cancelled.

Sections 14(g) and 22(b) of ANCSA, as well as BLM regulations governing the conveyance of land to Native corporations, have been interpreted as imposing a duty upon the BLM to determine the validity of third party interests created by the Federal government. 43 U.S.C. §§ 1613(g), 1621(b); 43 C.F.R. § 2650.3-1(a) (1987). See Appeals of the State of Alaska and Seldovia Native Ass'n, Inc., 84 Interior Dec. 349, 379-80 (1977), modified, 85 Interior Dec. 1 (1977). Following the Seldovia decision, the Secretary of the Interior issued Secretarial Order (S.O.) 3029 ⁸ which stated in part:

Clearly the administrative act of listing an interest as a valid existing right or of failing to list it does not create or extinguish the right. Because of this the ultimate validity of all interests may require court litigation.

Nevertheless it is appropriate for BLM to determine in the first instance the validity of those interests which are created by federal law since BLM is in most cases the agency charged with the administration of those laws.

43 Fed.Reg. 55287, 55291 (1978), amended, 45 Fed.Reg. 1692, 1693 (1980). Decisions of the Alaska Native Claims Appeal Board ⁹ (ANCAB) indicate that when conveying land to Native corporations the BLM routinely adjudicates all federally created third party interests with two exceptions irrelevant to this appeal. See, e.g., State of Alaska, Dep't of Transp. & Pub. Fac., 89 Interior Dec. 321 (1982) (air navigation site); Appeal of State of Alaska, 86 Interior Dec. 45 (1979) (road easement and material site state claimed it owned in fee). Given that adjudication of federally created interests is the BLM's policy, Tetlin argues that when the BLM fails to adjudicate a third party interest that party must appeal or lose the third party interest. Cf. State of Alaska, Dep't of Transp. & Pub. Fac 88 Interior Dec. 629 (1981), modified on other grounds, 89 Interior Dec. 346 (1982) (easement omitted from conveyance, State appealed to have conveyance amended so it listed the easement).

We disagree. Both the ANCAB and the...