Cermak v. United States Ex Rel. Department of Interior

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 06-1686
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Stanley Francis Cermak, Sr.; *
Raymond Cermak, Sr., *
*
Plaintiffs - Appellants, *
* Appeal from the United States
v. * District Court for the
* District of Minnesota.
United States of America, through its *
Department of Interior, Bureau of *
Indian Affairs, *
*
Defendants - Appellees, *
*
------------------------------------------------ *
Shakopee Mdewakanton Sioux *
Community, *
*
Amicus on Behalf of Appellees. *
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Submitted: November 15, 2006
Filed: February 28, 2007
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Before LOKEN, Chief Judge, LAY* and MELLOY, Circuit Judges.
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*
The HONORABLE DONALD P. LAY assumed permanent disability
retirement status on January 3, 2007. This opinion is being filed by the remaining
judges of the panel pursuant to 8th Cir. R. 47E.
LOKEN, Chief Judge.

In 1944, the Bureau of Indian Affairs (BIA) issued Indian Land Certificates 64
and 65, assigning the right to possess fifty acres of Indian trust land in Scott County,
Minnesota, to “John Cermak and his heirs . . . for the exclusive use and benefit of
[Cermak] so long as [Cermak] or his . . . heirs occupy and use said land.” In this
action, John Cermak’s son Stanley and grandson Raymond seek to enforce rights as
heirs under the Certificates. The BIA denied this claim, and the Interior Board of
Indian Appeals (IBIA) affirmed. The district court1 upheld the final agency action
under the Administrative Procedure Act, 5 U.S.C. § 706, and transferred any
remaining non-APA claims to the Court of Federal Claims for further proceedings.
Stanley and Raymond Cermak appeal. We affirm.

I. Background

Between 1888 and1890, Congress appropriated funds to purchase land for the
benefit of Mdewakanton Sioux and other Indians who remained in Minnesota after the
Sioux Uprising of 1862. For some years, the Commissioner of Indian Affairs
conveyed fee title to these lands to eligible Indians. But in 1904, the Commissioner
began issuing Indian Land Certificates as a way of assigning rights of occupancy and
use to individual Indians while retaining fee title in the United States. A 1915 letter
from the Assistant Commissioner to the Secretary of the Interior explained that these
Certificates passed no “vested interest . . . which requires any determination of the
heirs upon the death of such occupants.” Rather, upon the death of a Certificate
holder, the agency would reassign the land “to the Mdewakanton Sioux Indian who
appears to be most equitably entitled to have the temporary use and occupancy of it.”

1
HONORABLE DAVID S. DOTY, United States District Judge for the District
of Minnesota.

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 Some Certificates, including those issued to John Cermak, assigned occupancy
and use rights to land in Scott County to members of what is now the Shakopee
Mdewakanton Sioux Community (“the Community”).2 In 1980, Congress placed the
federal government’s “right, title, and interest” in those lands in trust for the benefit
of the Community, subject to “any contract, lease, or assignment entered into or issued
prior to enactment of this Act.” Pub. L. No. 96-557, §§ 1(1), 3, 94 Stat. 3262 (“the
1980 Act”). After this transfer, when a Certificate expires or is properly cancelled,
the Community (not the BIA) determines how the land will be used in the future for
the benefit of its members.

John Cermak died in 1989 leaving a will that devised to his son, Edward, “the
interest that I may have” in the land assigned by Certificates 64 and 65. The BIA
refused to probate John’s will, ruling that its probate authority is limited to a deceased
Indian’s ownership interest in Indian Trust lands, that “previous administrative
decisions” extinguished any inheritance rights in the Certificates, and that the 1980
Act had transferred beneficial ownership of the land to the Community. Edward
Cermak did not appeal or seek judicial review of this ruling. At the Community’s
request, the BIA then cancelled Certificates 64 and 65.

Edward Cermak died in May 1992. In 1994, Edward’s minor children asserted
a claim to their interest as “heirs” in the Certificates. The BIA rejected this claim,
again ruling that the Certificates conveyed no inheritable interest, that any “use rights”
expired with John Cermak’s death, and that the 1980 Act transferred all beneficial
interests to the Community. The children filed an administrative appeal. The IBIA
affirmed this decision as well as the BIA’s 1989 refusal to probate John Cermak’s
will. Gitchel v. Minneapolis Area Director, 28 IBIA 46, 48-49 (1995). Edward’s
children did not seek judicial review of this final agency action.

2
For reasons not germane to this appeal, the Shakopee Mdewankanton Sioux
are referred to as a Community rather than a Tribe or a Band.

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 Up to this point, Stanley and Raymond Cermak had taken no action other than
to write the BIA in 1990 seeking information and to publish on the day of Edward’s
death a letter addressed “To Whom It May Concern” advising that they “intend to lay
claim” to the land assigned in Certificates 64 and 65. In 1996, following the Gitchel
decision, Raymond on behalf of the “Cermak family” requested that the BIA “reopen
the land issue based on new evidence.” The BIA refused to do so in a letter ruling
stating that the Certificates “provided only life use rights to John and Edward Cermak
. . . which were extinguished by the death of the certificate holder.”

Raymond appealed this BIA ruling to the IBIA, as authorized by 43 C.F.R.
§ 4.331, stating for the first time in a reply brief that the appeal was also filed on
behalf of Stanley. The IBIA dismissed the appeal on the grounds that (i) Stanley
Cermak was not named in the notice of appeal and was therefore not a party to the
appeal, see 43 C.F.R. § 4.332(a), (ii) Raymond lacked standing because he presented
no evidence he was an heir of Edward or “would otherwise be entitled to take this
land, if it were devisable,” (iii) res judicata barred Raymond’s claim because he is in
privity with the Gitchel claimants and is therefore bound by that decision, and (iv) in
any event Raymond’s arguments “are not sufficient to cause the Board to reconsider”
the Gitchel decision. Cermak v. Acting Area Director, 32 IBIA 77, 80 (1998).

Raymond and Stanley commenced this action in 1998, initially asserting only
breach of trust and Takings Clause claims. The district court transferred those claims
to the Court of Federal Claims; we affirmed the transfer. Following a later suggestion
by the Federal Circuit, see Cermak v. Babbitt, 234 F.3d 1356, 1364 (C.A. Fed. 2000),
the Cermaks amended their complaint in the district court to assert the APA claim now
under review. Applying the proper APA standard of review, the district court granted
the government summary judgment, concluding that any challenge to the BIA’s initial
transfer of beneficial interest in the land to the Community is time-barred, and the
agency’s denial of the request to reopen its Gitchel decision was not arbitrary and
capricious. Cermak v. Norton, 322 F. Supp. 2d 1009 (D. Minn 2004).

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 II. Discussion

The IBIA’s decision in Gitchel determined that the heirs of John and Edward
Cermak inherited no interest in the land assigned by Certificates 64 and 65, that those
Certificates were properly cancelled in 1990, and that all beneficial interest in the trust
lands has been transferred to the Community. No one sought timely judicial review
of that final agency action. Accordingly, as counsel for Stanley and Raymond
conceded at oral argument, the APA claim reflected in their 1996 letter request to the
BIA will only provide them relief as a motion to reopen the Gitchel proceedings;
otherwise, the Gitchel decision is dispositive. Viewing the appeal in this manner, we
may put aside the IBIA’s res judicata ruling -- an agency decision cannot raise a res
judicata bar to a request to reopen that very decision. However, the IBIA also denied
the request to reopen on the merits; it is that decision we must review.

The Interior Department’s procedural regulations look with disfavor on requests
to reopen or reconsider BIA and IBIA decisions. They provide that such a request
must be made within thirty days of the decision and that reconsideration will be
granted “only in extraordinary circumstances.” 43 C.F.R. §§ 4.21(d), 4.315(a).
Raymond’s request to reopen was submitted more than one year after the Gitchel
decision. But the agency rejected the request on the merits, not as untimely, so we
will consider the merits as well.

The IBIA’s reluctance to reopen or reconsider its final decisions is consistent
with well-established principles of federal administrative law. Motions to reopen
agency proceedings are disfavored, like petitions for rehearing and motions for new
trial in judicial proceedings. See INS v. Abudu, 485 U.S. 94, 107 (1988); ICC v. Bhd.
of Locomotive Eng’rs, 482 U.S. 270, 279 (1987); Bowman Transp., Inc. v. Arkansas-
Best Freight Sys., Inc., 419 U.S. 281, 295-96 (1974). Reflecting this disfavor, we
review an agency’s denial of a request to reopen for abuse of discretion, recognizing
that the requesting party bears a “heavy burden” and that the agency deserves

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deference in deciding when its final decisions warrant reconsideration. Abudu, 485
U.S. at 109-110 & n.15; see 5 U.S.C. § 706(2)(A).

Here, we cannot say the IBIA abused its discretion in denying the request to
reopen its Gitchel decision. Raymond, a stranger to the Gitchel proceedings, made his
untimely request to reopen more than a year following Gitchel, and more than six
years after the BIA cancelled Certificates 64 and 65. During those many years,
Raymond and Stanley failed to assert their rights as putative heirs despite knowledge
of the agency’s position, while the lands in question were occupied and used by
members of the Community, creating conflicting interests and expectations.
Moreover, the IBIA rulings that Stanley did not properly join the appeal and Raymond
failed to establish his standing as Edward’s heir do not reflect arbitrary and capricious
decision-making.

Finally, though Raymond based his request to reopen on newly discovered
evidence, he and Stanley presented no new evidence to the agency, other than
asserting they are “heirs” within the meaning of Certificates 64 and 65. They merely
argued that the BIA “overstepped its authority” when it cancelled the Certificates. As
no statute expressly authorizes reopening on the ground of BIA error, it is arguable
that the denial order is not judicially reviewable at all. See Locomotive Eng’rs, 482
U.S. at 279-280. But the government did not make this argument, so we will assume
that denial of a motion based on agency error, like denial of a motion based on newly
discovered evidence, is reviewable for abuse of discretion. Without reaching the
merits of the Gitchel decision, we conclude the IBIA did not abuse its discretion in
refusing to reconsider that decision at the untimely request of strangers to the Gitchel
proceedings.

The Gitchel decision was consistent with longstanding agency policy regarding
the temporary nature of the rights assigned by Indian Land Certificates. In an earlier
decision, the IBIA thoroughly reviewed the background of Indian Land Certificates

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and the longstanding agency policy construing them as bestowing “a tenancy personal
to the assignment holder and her heirs conditioned upon personal occupancy and
personal use,” rather than an ownership interest that the Certificate holder’s heirs may
inherit. Brewer v. Acting Deputy Assistant Sec’y, 10 IBIA 110, 119 (1982). The
IBIA construed the 1980 Act as approving this policy by including lands subject to
existing Certificates in the lands placed in trust for the Community, subject only to the
occupancy and use rights of Certificate holders and their heirs during the life of the
Certificates. In Gitchel, the IBIA applied Brewer and this longstanding agency policy
and held that Certificates 64 and 65 conveyed no inheritable interest in the lands to the
heirs of John or Edward Cermak and therefore the BIA properly cancelled those
Certificates upon the death of their holder, John Cermak. The request to reopen filed
by Raymond gave the agency no adequate reason to reconsider this decision.

At oral argument, appellants conceded that only the APA claims are before us
on this appeal. Accordingly, the judgment of the district court is affirmed.
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