United States v. Mescalero Apache Tribe

• Decision Date: 11 July 1975
• Docket Number: 10-74 and 12-74.,Appeal No. 2-74
• Citation: 518 F.2d 1309
• Parties: The UNITED STATES of America, Appellant, v. MESCALERO APACHE TRIBE et al., Appellee. The UNITED STATES of America, Appellant, v. The SHOSHONE-BANNOCK TRIBES OF the FORT HALL RESERVATION, IDAHO, Appellee. The UNITED STATES of America, Appellant, v. TE-MOAK BANDS OF WESTERN SHOSHONE INDIANS OF NEVADA et al., Appellee-Cross-Appellant.
• Court: U.S. Claims Court

518 F.2d 1309

The UNITED STATES of America, Appellant, v. MESCALERO APACHE TRIBE et al., Appellee.

The UNITED STATES of America, Appellant, v. The SHOSHONE-BANNOCK TRIBES OF the FORT HALL RESERVATION, IDAHO, Appellee.

The UNITED STATES of America, Appellant, v. TE-MOAK BANDS OF WESTERN SHOSHONE INDIANS OF NEVADA et al., Appellee-Cross-Appellant.

Appeal Nos. 2-74, 10-74 and 12-74.

United States Court of Claims.

July 11, 1975.

COPYRIGHT MATERIAL OMITTED

A. Donald Mileur, Washington, D.C., with whom was Asst. Atty. Gen. Wallace H. Johnson, for appellant. Richard L. Beal, U. S. Dept. of Justice, Washington, D.C., for appellant in No. 2-74.

Craig A. Decker, Washington, D.C., atty. for appellant in Nos. 10-74 and 12-74.

I. S. Weissbrodt, Washington, D.C., atty. of record for appellee, Mescalero Apache Tribe. Weissbrodt & Weissbrodt, Richmond F. Allan and Howard L. Sribnick, Washington, D.C., of counsel.

Pierre J. LaForce, Washington, D.C., for appellees The Shoshone-Bannock Tribes and Te-Moak Bands of Western Shoshone Indians. Frances L. Horn, Washington, D.C., atty. of record. Wilkinson, Cragun & Barker and Robin A. Friedman, Washington, D.C., of counsel.

Before COWEN, Chief Judge, DURFEE, Senior Judge, and DAVIS, SKELTON, NICHOLS, KUNZIG and BENNETT, Judges.

ON APPEAL FROM THE INDIAN CLAIMS COMMISSION

SKELTON, Judge.

This is an appeal by the Government from orders of the Indian Claims Commission (Commission) in three Indian accounting cases (consolidated for this appeal) in which the Commission awarded simple and compound interest from 1883 to 1930 against the Government on trust funds it held for the three appellee Indian Tribes, notwithstanding the provisions of 28 U.S.C. § 2516(a) (1970) and the well established rule set forth in many decisions of the Supreme Court and of this court and other courts that in noneminent domain cases interest on a claim against the United States can be allowed only under a contract, treaty, or an Act of Congress expressly providing for the payment of interest. The orders of the Commission awarding interest cannot stand, and we reverse.

One of the Indian Tribes, the Te-Moak Bands of Western Shoshone Indians of Nevada (Te-Moaks), filed a cross-appeal from an order of the Commission denying it interest on shortages in the payments due it by the Government under the Western Shoshone Treaty of October 1, 1863, 18 Stat. 689. The Commission held that these shortages were never paid and were never set up as trust funds and could not bear interest as they never in fact existed. We think the order of the Commission in this regard was correct and we affirm. A discussion of the law and the facts follows.

The Government appealed from the following orders of the Commission:

(1) The order of October 4, 1973, 31 Ind.Cl.Comm. 427, 557, and 559, Te-Moak Bands of Western Shoshone Indians of Nevada, Docket No. 326-A (Appeal No. 12-74) and Mescalero Apache Tribe (Mescalero Apaches), Docket No. 22-G (Appeal No. 2-74) holding that the United States is liable for simple interest and compound interest on the fund known as "Indian Moneys, Proceeds of Labor" (I.M.P.L. Funds),¹ from 1883 to 1930.

(2) The order of January 16, 1974 (unreported), holding that the above order of October 4, 1973, was the law of the case in Shoshone-Bannock Tribes of the Fort Hall Reservation (Shoshone-Bannocks), Docket No. 326-C (Appeal No. 10-74).

The Te-Moaks cross-appealed as to that part of the above order of October 4, 1973, that denied them interest on the unpaid shortages of treaty funds mentioned above. They also cross-appealed from the Commission's order of April 4, 1974, 33 Ind.Cl.Comm. 417, 435 denying their motion for rehearing on the decision of October 4, 1973, above.

By way of background, it should be pointed out that prior to 1883 the I.M. P.L. Funds were not extensive and were held by local Government agents. These agents disbursed these funds from time to time to meet the needs of the Indians. Such expenditures were usually made after consultation with the Indians and with their approval. However, by 1883 the I.M.P.L. Funds had begun to increase in amount and it was decided that they should be taken from the local agents and deposited in the U.S. Treasury for the benefit of the Indians. The Act of March 3, 1883, ch. 141, 22 Stat. 590 was the result. It reads in pertinent part as follows:

The proceeds of all pasturage and sales of timber, coal, or other product of any Indian reservation, except those of the five civilized tribes, and not the result of the labor of any member of such tribe, shall be covered into the Treasury for the benefit of such tribe under such regulations as the Secretary of the Interior shall prescribe; and the Secretary shall report his action in detail to Congress at its next session.

Significantly, the Act makes no mention of a duty to invest such proceeds or to pay interest thereon. To the contrary, it expressly provides that the proceeds "shall be covered deposited into the Treasury for the benefit of such tribe under such regulations as the Secretary of Interior shall prescribe."

Pursuant to the 1883 Act, the I.M.P.L. Funds were deposited in the Treasury for the first time in one common fund for all of the Indians. But due to a technicality in the Act, the Secretary of the Treasury would not allow the Secretary of the Interior to withdraw any of these funds without an appropriation by Congress. This proved to be a cumbersome arrangement because the money was needed from time to time to meet the needs of the Indians. As a consequence, the Act was amended by the Act of March 2, 1887, ch. 320, 24 Stat. 463 which provided in pertinent part as follows:

That the Secretary of the Interior is hereby authorized to use the money which has been or may hereafter be covered into the Treasury under the provisions of the act approved March third, eighteen hundred and eighty-three, and which is carried on the books of that Department under the caption of "Indian moneys, proceeds of labor," for the benefit of the several tribes on whose account said money was covered in, in such way and for such purposes as in his discretion he may think best, and shall make annually a detailed report thereof to Congress.

This 1887 amendment gave the Secretary of the Interior the authority to use the I.M.P.L. Funds in his discretion for the benefit of the Indians without an appropriation by Congress. It is significant that the 1887 amendment, like the Act of 1883, did not provide for the payment of interest on I.M.P.L. Funds. Actually, these funds were transient in character because they were paid out from time to time to provide for the needs of the Indians. Obviously, funds of this character did not lend themselves to investment purposes to earn interest because they were not available for a sufficient length of time to allow them to be used to purchase stocks or bonds or other securities that would earn interest only after a long period of time. It is clear that Congress did not intend to pay interest on these funds nor to require them to be invested in interest bearing stocks, bonds, or other securities. The existing facts mentioned above militate against any such intention, and clearly the Acts of 1883 and 1887 did not require the Government to pay interest on these funds nor that they be made productive otherwise.

The statute controlling I.M.P.L. Funds was amended again by the Act of May 17, 1926, ch. 309, 44 Stat. 560 and provided in pertinent part as follows:

* * * That hereafter all miscellaneous revenues derived from Indian reservations, agencies, and schools, which are not required by existing law to be otherwise disposed of, shall be covered into the Treasury of the United States under the caption "Indian moneys, proceeds of labor," and are hereby made available for expenditure, in the discretion of the Secretary of the Interior, for the benefit of the Indian tribes, agencies, and schools on whose behalf they are collected, subject, however, to the limitations as to tribal funds, imposed by section 27 of the Act of May 18, 1916 (Thirty-ninth Statutes at Large, page 159).

This amendment, like the Acts of 1883 and 1887 did not provide for the payment of interest on I.M.P.L. Funds. By this time it was clear that Congress knew that no interest was being paid on these funds and that they were not otherwise productive, and that Congress approved of this manner of handling I.M.P.L. Funds. This knowledge of Congress and its approval of the administrative interpretation of the I.M.P.L. statutes as not to require payment of interest by the Government on I.M.P.L. Funds or make them otherwise productive is forcefully shown in the records of this case by the reports to Congress by the Commissioner of Indian Affairs for 1904 and 1905 which stated that Indian funds were divided into two categories, namely, (1) "Trust Funds and Trust Lands" and (2) "Income of Indian Tribes." Under the trust funds classification were listed all the funds required to be productive as a trust fund held by the Government by an act, resolution or treaty. Such funds bore interest and the principal amounts and the interest earned were shown together with the appropriate congressional authority for each tribe for each year. The second classification "Incomes of Indian Tribes" consisted of four sub-classifications, namely, (1) "Interest on trust fund," (2) "Treaty and agreement obligations," (3) "Gratuities," and (4) "Indian moneys, proceeds of labor and miscellaneous (I.M.P.L. Funds)." It was obviously clear to Congress that no interest was being paid on I.M.P.L. Funds and that Congress approved of this manner of handling these funds.

This brings us to 1929 when the Secretary of the Interior recommended to Congress that the noninterest bearing I.M.P.L. Funds held by the Government for Indians be made interest bearing funds. It is significant that he stated in his recommendation:

It is conceded that there is no legal

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