Your Food Stores, Inc. v. Village of Espanola

• Decision Date: 10 April 1961
• Docket Number: No. 6716,6716
• Citation: 1961 NMSC 41,68 N.M. 327,361 P.2d 950
• Parties: YOUR FOOD STORES, INC. (NSL), a New Mexico Corporation, Plaintiff-Appellant, v. VILLAGE OF ESPANOLA, New Mexico, a municipal corporation, and Robert Valdez, Commissioner of the Bureau of Revenue of the State of New Mexico, Defendants-Appellees.
• Court: New Mexico Supreme Court

Page 950

361 P.2d 950

68 N.M. 327

YOUR FOOD STORES, INC. (NSL), a New Mexico Corporation, Plaintiff-Appellant, v. VILLAGE OF ESPANOLA, New Mexico, a municipal corporation, and Robert Valdez, Commissioner of the Bureau of

Revenue of the State of New Mexico,

Defendants-Appellees.

No. 6716.

Supreme Court of New Mexico.

April 10, 1961.

Rehearing Denied June 8, 1961.

Catron & Catron, John S. Catron, Santa Fe, for appellant.

Edwin L. Felter, Santa Fe, for appellees.

Standley & Kegel, Santa Fe, on motion for rehearing, for appellees.

Dazzo, Dazzo & Brophy, Albuquerque, amicus curiae.

NOBLE, Justice.

The single question for determination is whether a municipality may lawfully extend its corporate limits to include lands of an Indian tribe and to enforce, within such lands, a municipal sales tax against a business located upon land leased from the Indian tribe.

No question is raised as to validity of the sales tax ordinance nor as to the annexation proceedings if the municipality could legally annex Indian lands.

It is contended that the jurisdiction of the State of New Mexico does not extend to lands owned or held by a Pueblo Indian tribe; that the purported annexation of such lands is void, and that the municipal sales tax ordinance is enforceable only within the municipal boundaries.

The Santa Clara Pueblo owns and occupies a tract of land as communal or tribal lands patented to the Pueblo by the United States pursuant to an Act of Congress confirming a claim of a grant to the Indian tribe by the King of Spain, a former sovereignty. Appellant occupies and operates a supermarket and variety store upon a portion of the Indian lands, contiguous to the Village of Espanola, sub-leased to appellant from a lessee of the Pueblo with approval of the Secretary of the Interior.

In 1955 the Village of Espanola purported to extend its boundaries, pursuant to Sec. 14-6-11, N.M.S.A. 1953 Comp., to include the land leased by appellant and other lands, and in 1959, by Ordinance No. 132, imposed a municipal sales tax upon sales and services within its corporate limits.

It is not questioned that a municipality is granted power to levy and collect a municipal sales tax only within its corporate limits, Sec. 14-42-25, N.M.S.A. 1953 Comp., and that if these lands were not validly brought within the corporate limits the tax cannot be collected from appellant. The case proceeds here upon the assumption that the limits of the village are determinative of those within which the sales tax may be imposed. The trial court predicated its dismissal of the complaint seeking to enjoin collection of the tax upon three principal grounds: First, that by virtue of the lease to appellant the Santa Clara Pueblo divested itself of the right of possession, dominion and control of the lands included in the lease; second, that the municipality, had the legal right and did lawfully annex the lands, and that the same became a part of the municipality for all purposes and subject to all ordinances, regulations and taxes, not inconsistent with the Constitution and laws of the United States, or with the right of self-government of the Indian members of the Santa Clara Pueblo; and, third, that the sales tax does not impose any burden upon a federal instrumentality, upon the Santa Clara Pueblo or the Indian members thereof, and does not conflict with the Constitution of the United States nor with the right of self-government of the Santa Clara Pueblo Indians.

We are, thus, first brought to a consideration of the status of Indian tribes, Indian lands, and the jurisdiction of the State of New Mexico, by legislation to exercise control over Indians living on a reservation or lands owned by Indian tribes. It is clear that if the State itself cannot impose its laws on the Pueblo, the Village of Espanola, as a political subdivision of the State, cannot be conferred powers which the State itself does not possess. Munro v. City of Albuquerque, 48 N.M. 306, 150 P.2d 733.

The early landmark case of Worcester v. Georgia, 1832, 6 Pet. 515, 31 U.S. 515, 8 L.Ed. 483, in an exhaustive opinion by Chief Justice Marshall, developed that the Indian tribes are distinct political entities, with the right of self-government, having exclusive authority within their territorial boundaries and are not subject to the laws of the State in which they are located nor to federal laws except where federal laws or the jurisdiction of courts is expressly conferred by federal legislation. The court there held invalid a Georgia statute prohibiting and making it an offense for a non-Indian to go upon lands of an Indian reservation, as invading the right of the Indians to self-government.

The broad principles of the Worcester decision have been adhered to by the federal courts ever since. The Kansas Indians, 5 Wall. 737, 18 L.Ed. 667; Ex parte Crow Dog, 109 U.S. 556, 3 S.Ct. 396, 27 L.Ed. 1030; United States v. Kagama, 118 U.S. 375, 6 S.Ct. 1109, 30 L.Ed. 228; United States v. Forness, 2 Cir., 125 F.2d 928; Iron Crow v. Oglala Sioux Tribe, 8 Cir., 231 F.2d 89. These basic principles were reaffirmed as late as Williams v. Lee, 1959, 358 U.S. 217, 79 S.Ct. 269, 3 L.Ed.2d 251.

The early policy of leaving Indians free from state jurisdiction and control is deeply rooted in our nation's history. Rice v. Olson, 1945, 324 U.S. 786, 65 S.Ct. 989, 89 L.Ed. 1367.

Without quoting extensively from the many decisions of the Supreme Court of the United States determining the jurisdiction of states and of state and federal courts over Indians, we think the decisions are well summarized in Felix S. Cohen's Handbook of Federal Indian Laws, and is thus stated at page 122:

'Section 2. The Derivation of Indian Powers. From the earliest years of the Republic the Indian tribes have been recognized as 'distinct, independent political communities' * * * and as such qualified to exercise powers of self-government, not by virtue of any delegation of powers from the Federal Government, but rather by reason of their original tribal sovereignty.

* * *

* * *

'The whole course of judicial decision on the nature of Indian tribal powers in marked by adherence to three fundamental principles: (1) An Indian tribe possesses, in the first instance, all the powers of any sovereign state. (2) Conquest renders the tribe subject to the legislative power of the United States and, in substance, terminates the external powers of sovereignty of the tribe, e. g. its power to enter into treaties with foreign nations, but does not by itself affect the internal sovereignty of the tribe, i. e. its powers of local self-government. (3) These powers are subject to qualification by treaties and by express legislation of Congress, but save as thus expressly qualified, full powers of internal sovereignty are vested in the Indian tribes and in their duly constituted organs of government.'

To our minds, the terms upon which New Mexico was admitted as one of the States of the Union and Article XXI, Sec. 2 of our Constitution, left no room for a claim by the state to governmental power over the Indians or Indian lands, except where such jurisdiction has been specifically granted by Act of Congress, or sanctioned by decisions of the Supreme Court of the United States. The pertinent part of section 2 of the Enabling Act reads:

'Second. That the people inhabiting said proposed state do agree and declare that they forever disclaim all right and title * * * to all lands lying within said boundaries owned or held by any Indian or Indian tribes the right or title to which shall have been acquired through or from the United States or any prior sovereignty, and that until the title of such Indian or Indian tribes shall have been extinguished the same shall be and remain * * * under the absolute jurisdiction and control of the Congress of the United States * * *.'

That compact between New Mexico and the United States was carried out by adoption of Article XXI, Sec. 2, of the State Constitution. The Pueblo Indians have the same right of self-government as other Indian tribes. The Indian Reorganization Act, 48 Stat. 984, as amended, 25 U.S.C.A. Sec. 461 et seq. See United States v. Sandoval, 231 U.S. 28, 34 S.Ct. 1, 58 L.Ed. 107; United States v. Candelaria, 271 U.S. 432, 46 S.Ct. 561, 70 L.Ed. 1023; Toledo v. Pueblo de Jemez, D.C., 119 F.Supp. 429; The Pueblo Lands Act, 43 Stat. 636, 28 U.S.C.A. Sec. 331 note. That the provisions of the Enabling Act and New Mexico Constitution were intended to apply to Pueblo Indians cannot be doubted. Section 2, subd. 8 of the Enabling Act provided:

'Eighth. * * * and the terms 'Indian' and 'Indian country' shall include the Pueblo Indians of New Mexico and the lands now owned or occupied by them'

It has been suggested that the silence of Congress to enact legislation defining where jurisdiction rests in specific matters discloses no objection by Congress to the operation of state laws over Indians and Indian lands. That, at least, can no longer be said to be a valid construction. Indian tribes were given the right of self-government by Congress. Wheeler-Howard Act, 25 U.S.C.A. Sec. 476, which reads:

'Any Indian tribe, or tribes, residing on the same reservation, shall have the right to organize for its common welfare, and may adopt an appropriate constitution and bylaws, which shall become effective when ratified by a majority vote of the adult members of the tribe, or of the adult Indians residing on such reservation, as the case may be, at a special election authorized and called by the Secretary of the Interior under such rules and regulations as he may prescribe * * *.'

The Santa Clara Pueblo adopted and acts under a written constitution. Federal Indian Law, p. 915. It is conceded that the Santa Clara Pueblo is self-governing. We think that the Pueblo Indian tribes possess inherent sovereignty except where it has been specifically taken from them by congressional action. This is additionally...