Yavapai-Prescott Indian Tribe v. Watt, CIV 80-464 PCT CLH.
| Decision Date | 21 December 1981 |
| Docket Number | No. CIV 80-464 PCT CLH.,CIV 80-464 PCT CLH. |
| Parties | YAVAPAI-PRESCOTT INDIAN TRIBE, Petitioner, v. James G. WATT, as Secretary of the Interior, et al., Respondents. |
| Court | U.S. District Court — District of Arizona |
Philip E. Toci, Toci, Murphy & Beck, Prescott, Ariz., for petitioner.
George B. Nielsen, Jr., Asst. U. S. Atty., Phoenix, Ariz., for U. S.
Thomas J. Reilly, Snell & Wilmer, Phoenix, Ariz., for Marlin D. Kuykendall.
Two questions have been presented to the Court:
1. Does this Court have subject-matter jurisdiction of an appeal from a ruling of the Interior Board of Indian Appeals (the Board)? It does.
2. Was the Board correct in ruling that a lease of Indian trust lands for business purposes pursuant to 25 U.S.C. § 415 (1976) could not be cancelled without the approval of the Secretary of Interior?1 It was not.
In 1969 the Yavapai-Prescott Indian Tribe (the Tribe)2, as lessor, and Marlin D. Kuykendall, as lessee, entered into a lease agreement for approximately 2.06 acres of land which was to be used for an automobile dealership and service station for a term of 25 years, with an option to renew for an additional term of 25 years. The lease recited that it was made "under the provisions of the Act of August 9, 1955 (69 Stat. 539)3 as implemented by Part 131, Leasing and Permitting, of the Code of Federal Regulations, Title 25-Indians, and any amendments thereto." Article 19 of the lease provides in part, Article 30 provides in part:
"...should Lessee default in any payment of moneys...or should Lessee breach any other covenant of this lease, and if such breach shall continue uncured for a period of sixty (60) days after written notice thereof by the Lessor or the Secretary to Lessee,...then Lessor and/or the Secretary may terminate the lease."
The lease was approved by the Secretary of Interior acting through an authorized agent.
In March 1979 Kuykendall entered into an agreement with a partnership for the sale of his dealership and a sublease of the premises. On April 6th the Tribe informed Kuykendall the sublease was disapproved and notified him that the sublease was a breach of the lease. He was also informed that, to cure the breach, he must remove the partnership from the premises and retake the dealership himself. This was not done, and on June 27, 1979 Kuykendall was informed by a tribal attorney that his lease with the Tribe was terminated. The Secretary of the Interior did not participate in the cancellation of the lease.
In August of 1979, Kuykendall requested the Area Director of the Bureau of Indian Affairs to intervene to prevent the Tribe from cancelling the lease. The Area Director refused to intervene, ruling that the tribe had the authority to cancel the lease, and an administrative appeal was taken to the Board pursuant to 25 CFR 2.19. The Board ruled in favor of Kuykendall, holding that, notwithstanding the provisions of the lease, it could be terminated only by the Secretary pursuant to the provisions of 25 CFR § 131.14. The Tribe has filed this action pursuant to the Administrative Procedure Act (5 U.S.C. § 701 et seq.) to review the Board's decision.
The parties agree that if this Court has jurisdiction of this action, it is derived from 28 U.S.C. § 1331, which confers jurisdiction of a civil action which "arises under the Constitution, laws, or treaties of the United States". Kuykendall argues that whether the Tribe may unilaterally cancel the lease "depends not upon an interpretation of the Constitution, laws, or treaties of the United States but an interpretation of the Lease" (emphasis by Kuykendall) and that "There is no claim in the Complaint that the Board's interpretation of the Lease is contrary to the Constitution, laws, or treaties of the United States." Motion to Dismiss at 6-7. However, this case involves not only an interpretation of the lease but also the question whether the lease could be terminated by the Tribe unilaterally, without any action on the part of the Secretary. Resolution of the latter issue involves the interrelationship of the lease, the federal regulations and the powers conferred on the Secretary of Interior by 25 U.S.C. § 415. Furthermore, 28 U.S.C. § 1331 confers jurisdiction on Federal Courts to review agency action. Andrus v. Charlstone Stone Prod. Co., 436 U.S. 604, 98 S.Ct. 2002, 56 L.Ed.2d 570 (1978) and Califano v. Sanders, 430 U.S. 99, 97 S.Ct. 980, 51 L.Ed.2d 192 (1977).
Restricted Indian lands may be leased by the Indian owners, with the approval of the Secretary of Interior, for business purposes, and "all leases and renewals shall be made under such terms and regulations as may be prescribed by the Secretary of the Interior." 25 U.S.C. § 415(a). The Secretary has promulgated regulations relating to the leasing of lands which are held in trust for individual Indians or tribes or are subject to federal restrictions against alienation or encumbrance. 25 CFR § 131.1 et seq. Section 131.14 provides a procedure to be followed by the Secretary in the event that there has been a violation of a lease. The Board concluded that the procedure prescribed by Section 131.14 had to be followed in order to cancel Kuykendall's lease. In this Court's opinion, the Board's ruling is based upon a misapprehension of the meaning of "all leases and renewals shall be made under such terms and regulations as may be prescribed by the Secretary of the Interior" in 25 U.S.C. § 415(a).
Among the powers delegated to the Secretary of the Interior by Congress is the management of all Indian affairs. See 25 U.S.C. § 2. The statute authorizing leases of restricted Indian lands for business purposes, 25 U.S.C. § 415, specifically requires that any lease have the approval of the Secretary and that it "shall be made under such terms and regulations as may be prescribed by the Secretary." In this case the Secretary gave his approval, and the lease recited that it was under the provisions of the Act as implemented by Part 131 of the Code of Federal Regulations, Title 25.
Part 131 of Title 25 of the Code of Federal Regulations does not purport to specify in detail the provisions to be included in any lease of Indian lands, and CFR § 131.14 does not purport to specify an exclusive method for cancelling leases. It simply establishes a procedure whereby the Secretary may cancel a lease upon a showing satisfactory to him that there has been a violation of the lease.
Pursuant to his statutory authority, the Secretary has...
To continue reading
Request your trial
-
Yavapai-Prescott Indian Tribe v. Watt
...article 30, the Tribe could enforce its unilateral cancellation. The district court therefore reversed the decision of the Board, 528 F.Supp. 695, and subsequently dismissed Kuykendall's counterclaim without comment. For the reasons set forth below, we reverse the district court and reinsta......
- Bryne v. GULFSTREAM FIRST BANK & TRUST CO., ETC.