United States v. Board of Com'rs

• Decision Date: 14 February 1939
• Docket Number: 2659,2695,2709.,2683,No. 2658,2699,2658
• Citation: 26 F. Supp. 270
• Parties: UNITED STATES v. BOARD OF COM'RS OF OSAGE COUNTY, OKL., et al. (six cases).
• Court: U.S. District Court — Northern District of Oklahoma

26 F. Supp. 270

UNITED STATES v. BOARD OF COM'RS OF OSAGE COUNTY, OKL., et al. (six cases).

Nos. 2658, 2659, 2683, 2695, 2699, 2709.

District Court, N. D. Oklahoma.

February 14, 1939.

Whit Y. Mauzy, U. S. Atty., and Chester A. Brewer, Asst. U. S. Atty., both of Tulsa, Okl.

Charles R. Gray, Ladd H. Gambill, and Sim T. Carman, all of Pawhuska, Okl., for defendants.

FRANKLIN E. KENNAMER, District Judge.

The United States of America, on behalf of numerous Osage Indians, has instituted six different suits, wherein the Government seeks to recover for said Indians taxes paid on real estate in Osage County, Oklahoma, for the year 1936. There are two hundred twenty nine causes of action involved in the six suits, and the total sum sought to be recovered is twenty eight thousand one hundred forty five & 80/100 dollars ($28,145.80) in taxes paid. The real estate on which the taxes were paid under protest, is land and town property, both residence and business.

In each cause of action it is alleged that the property on which the taxes were paid under protest was purchased with restricted funds of Osage Indians, and that such property is restricted against alienation or incumbrances, except with the consent or approval of the Secretary of Interior. It is also alleged that the real estate is nontaxable under and by virtue of Section 2 of the Act of Congress of June 20, 1936, 49 Stat. 1542, 25 U.S.C.A. § 412a, but that notwithstanding the non-taxability of the real estate, the County officials of Osage County, Oklahoma, assessed it for taxation for the year 1936, and that such taxes for that year were paid under protest, and the suits are instituted for the purpose of recovering the taxes so paid.

The defendants have interposed demurrers or motions to dismiss, in which it is urged that the petitions do not state facts sufficient to constitute a cause of action; that the petitions show no recovery can be had of any taxes assessed, levied, paid or collected for the year 1936, and finally, that the petitions show that the Act of Congress upon which recovery is sought has no application to the Osage Indians or to the property on which the taxes were paid. The cases come on for hearing upon the demurrers or motions to dismiss.

The Act of Congress relied on for recovery herein, is as follows:

"An Act To relieve restricted Indians whose lands have been taxed or have been lost by failure to pay taxes, and for other purposes.

"Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled:

"Section 1. That there is hereby authorized to be appropriated, out of any money in the Treasury of the United States not otherwise appropriated, the sum of $25,000, to be expended under such rules and regulations as the Secretary of the Interior may prescribe, for payment of taxes, including penalties and interest, assessed against individually owned Indian land the title to which is held subject to restrictions against alienation or encumbrance except with the consent or approval of the Secretary of the Interior, heretofore purchased out of trust or restricted funds of an Indian, where the Secretary finds that such land was purchased with the understanding and belief on the part of said Indian that after purchase it would be nontaxable, and for redemption or reacquisition of any such land heretofore or hereafter sold for nonpayment of taxes.

"Sec. 2. All lands the title to which is now held by an Indian subject to restrictions against alienation or encumbrance except with the consent or approval of the Secretary of the Interior, heretofore purchased out of trust or restricted funds of said Indian, are hereby declared to be instrumentalities of the Federal Government and shall be nontaxable until otherwise directed by Congress.

"Approved, June 20, 1936."

The above Congressional Act was amended, insofar as Section 2 thereof is concerned, as follows:

"Sec. 2. All homesteads, heretofore purchased out of the trust or restricted funds of individual Indians, are hereby declared to be instrumentalities of the Federal Government and shall be nontaxable until otherwise directed by Congress: Provided, That the title to such homesteads shall be held subject to restrictions against alienation or encumbrance except with the approval of the Secretary of the Interior: And provided further, That the Indian owner or owners shall select, with the approval of the Secretary of the Interior, either the agricultural and grazing lands, not exceeding a total of one hundred and sixty acres, or the village, town, or city property, not exceeding in cost $5,000, to be designated as a homestead.

"Approved, May 19, 1937." 50 Stat. 188, 25 U.S.C.A. § 412a.

The above are set forth in full, as the determination of the cases rests solely upon them.

It is contended by the defendants, in support of their demurrers, that the above Act of June 20, 1936, when construed with other Congressional Acts relating to Osage Indians, shows an intention of Congress to allow Osage Indians tax exemption on homesteads alone; that the Amendment of May 19, 1937, discloses that the intention of Congress was to limit the tax exemption to homesteads of not more than one hundred sixty acres of land; that the Act cannot apply to the taxes for the year 1936, for the reason that such lands become subject to taxation in Oklahoma on January first of each year, and the Congressional Act was not passed until June of said year, and finally, that the Congressional Act is an invasion of State rights and contrary to the Constitution of the United States.

It is urged, on behalf of the United States, that the actions are well taken and the petitions state valid causes of action, for the reason that the Congressional Act involved is plain and unambiguous, and that the Court cannot resort to other Congressional Acts governing Osage Indians or to the Amendment to the particular Act, in order to ascertain the intention of Congress. It is also argued that the Congressional Act plainly speaks the intention of Congress, being clear upon its face, and when standing alone is fairly susceptible of but one construction and that the court cannot give it another construction by referring to other Congressional Acts. It is further contended that the Act in question deals with an entirely distinct and separate matter from any special Acts governing Osage Indians, and that the Act of June 20, 1936, is not limited by any prior Acts of Congress. Another contention is that the Amendment of May 19, 1937, cannot be considered in construing the particular Act because the court must assume that Congress acted intelligently, and since it has so plainly expressed its intention in the Act itself, that intention must be given effect; also the report of the Committees of Congress cannot be used for the purpose of construing an Act contrary to its plain terms. It is further urged that the Act affects 1936 taxes and for that reason the lien of the taxes do not attach until July of 1936, and subsequent to the passage of the Congressional Act.

Defendants contend that the prior Osage Acts are important in ascertaining the intention of Congress in the Act of June 20, 1936, and that when so construed the intention is to allow each Osage Indian a tax exemption of not more than one hundred sixty acres of land. The prior acts referred to are the Osage Act of June 28, 1906, 34 St.L. 539, which Act provides that the homestead of the allottee shall remain inalienable and non-taxable, so long as title remains in the allottee and exempts all land other than homestead from taxation, for a term of three years from the approval of the Act.

The Osage Act of April 18, 1912, 37 St.L. 86, provides that the Secretary of the Interior is authorized to pay the taxes on lands out of any money due and payable to the heirs, from the segregated funds of deceased Indians, and also provides that inherited moneys shall be liable for funeral expenses and expenses of last illness of deceased Osage Indians, and exempts certain properties from debts, but provides that nothing in the Act shall be construed so as to exempt such property from liability for taxes.

The Act of February 27, 1925, 43 St.L. 1008, 25 U.S.C.A. § 331 note, authorized the Secretary of the Interior to pay Osage Indians less than their income and to conserve the balance and invest the same, after paying taxes of such members.

The Act of March 2, 1929, 45 St. 1478, extends the trust period, and provides that the tax-exempt land of any Osage Indian allottee, heir, or devisee, shall not at any time exceed one hundred sixty acres. It is contended that these Acts show an intention upon the part of Congress to exempt only homesteads not in excess of one hundred sixty acres of land, from taxation for Osage Indians, and that the Act of June 20, 1936, should be limited to that extent. It is insisted that the first paragraph of the Act provides for an appropriation of $25,000 for the payment of taxes and redemption of lands sold for taxes, and that since the amount involved in the six suits under consideration exceeds $25,000, that the Act shows by its very terms that it is not applicable to Osage Indians.

The Government relies upon the second paragraph of the Act for its right to recover. As noted, the second paragraph provides that all lands purchased from restricted funds shall be non-taxable. There is no conflict in the Act of June 20, 1936, and the earlier Osage Acts. It is certainly within the power of Congress to exempt restricted lands from taxation, and the Act of June 20, 1936, plain and unambiguous as it is, provides that all lands purchased out of trust or restricted funds of Indians are declared to be instrumentalities of the Federal Government and non-taxable. This Act supplements the earlier Osage Acts; it cannot be restricted by them because there is no conflict in the Acts, and no construction can be placed thereon except the...