No. 88-76
IN THE SUPREME COURT OF THE STATE OF MONTANA
1988
NICK GEIGER,
Plaintiff and Respondent,
-VS-
LAVONNE L. PIERCE,
Defendant and Appellant.
APPEAL FROM: District Court of the Twentieth Judicial District,
In and for the County of Lake,
The Honorable C.B. McNeil, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
John B. Carter, Pablo, Montana
For Respondent :
K. M. Bridenstine, Polson, Montana
Submitted on Briefs: May 19, 1988
Decided: July 14, 1988
Filed: m941988"
Clerk
Mr. Justice John C. Sheehy delivered the Opinion of the
Court.
Lavonne L. Pierce appeals from an order of summary
judgment from the District Court, Twentieth Judicial
District, Lake County, awarding Geiger the sum of $4,500. We
reverse.
Appellant raises the following issue for our review: Do
the state courts of Montana have primary subject matter
jurisdiction over a debt action arising on an Indian
reservation, brought by a resident non-Indian creditor
against an enrolled tribal member residing on the
reservation?
The record discloses the following pertinent facts.
Pierce is an enrolled member of the Confederated Salish
and Kootenai Tribes of the Flathead Reservation. She
purchased a mobile home from Geiger, a nontribal member, at
Geiger's place of business in Polson, Montana. A written
contract was entered into and all payments were to be made at
Polson, Montana. Polson is within the exterior boundaries of
the Flathead Reservation and both parties reside there.
On August 28, 1986, Geiger filed a complaint in District
Court alleging that Pierce had failed to make the payments on
the installment sales contract and owed the plaintiff $4,500.
After Pierce had answered Geiger's amended complaint, on
June 22, 1987, Geiger plaintiff filed a motion for summary
judgment. The District Court issued an order granting
summary judgment shortly thereafter. On July 23, 1987,
Pierce filed her motion to vacate summary judgment claiming
for the first time that the District Court lacked
jurisdiction over the subject matter of the dispute because
she is an enrolled member of the Confederated Salish and
Kootenai Tribes. Briefs were submitted by both parties. The
District Court found that it had subject matter jurisdiction
over the action and denied Pierce's motion to vacate summary
judgment. Pierce appeals from the District Court's order
granting Geiger summary judgment as well as the court's
subsequent denial of Pierce's motion to vacate the order.
The dispositive issue that we must address is whether
the state courts of Montana have primary subject matter
jurisdiction over a debt action arising out of transactions
on an Indian reservation, brought by a non-Indian creditor
against an enrolled tribal member debtor, both of whom reside
on the reservation. We find that they do not.
In State ex rel. Iron Bear v. District Court (1973), 162
Mont. 335, 512 P.2d 1292, this Court held:
Before a district court can assume jurisdiction in
any matter submitted to it, it must find subject
matter jurisdiction by determining:
(1) Whether the federal treaties and statutes
applicable have preempted state jurisdiction;
(2) Whether the exercise of state jurisdiction
would interfere with reservation self government;
and (3) Whether the Tribal Court is currently
exercising jurisdiction or has exercised
jurisdiction in such a manner as to preempt state
jurisdiction.
162 Mont. at 346, 512 P.2d at 1299. See also Williams v. Lee
(1959), 358 U.S. 217, 79 S.Ct. 269, 3 L.Ed.2d 251; Security
State Bank v. Pierre (1973), 162 Mont. 298, 511 P.2d 325; see
generally, Milbank Mut. Ins. Co. v. Eagleman (Mont. 1985) ,
705 P.2d 1117, 42 St.Rep. 1393 (the first two elements of the
- - test are disjunctive; if either is present, the
Iron Bear
state lacks subject matter jurisdiction.)
Generally civil jurisdiction over commercial activities
presumptively lies in the tribal courts unless affirmatively
limited by a specific treaty, provision or federal statute.
Iowa Mutual Ins. Co. v. LaPlante (1987), - U.S. -1
107 S.Ct. 971, 978, 94 L.Ed.2d 10, 16. The civil
jurisdiction of the tribal court in this matter has not been
affirmatively limited by a specific treaty, provision or
federal statute. Although the State of Montana has criminal
jurisdiction over the Flathead reservation, there has been no
consent to assumption by the state of jurisdiction over
commercial transactions occurring on that reservation.
In addition, the subject matter of the immediate case is
clearly within the pre-emptive jurisdiction assumed by the
tribal court of the Confederated Salish and Kootenai Tribes.
See Chapter 11, Civil Actions, Section 1, Confederated Salish
and Kootenai Tribes' Law and Order Code, Ordinance 36 (b) as
amended (1982). To find primary state courts jurisdiction
over this action would impugn the tribal court's right to
resolve controversies arising out of commercial conduct
occurring between Indians and non-Indians within the
boundaries of the reservation. Such authority is clearly an
important part of tribal sovereignty. See Montana v. United
States (1981), 450 U.S. 544, 101 S.Ct. 1245, 67 L.Ed.2d 10;
Washington Confederated Tribes of Colville Indian Reservation
(1980), 447 U.S. 134, 100 S.Ct. 2069, 65 L.Ed.2d 10; Fisher
v. District Court (1976), 424 U.S. 382, 96 S.Ct. 943, 47
L.Ed.2d 106.
It is apparent that the exercise of state jurisdiction
in the immediate case would interfere with reservation
self-government. As we have stated:
A tribe's interest in self-government could be
implicated in one of two ways. First, if a state
or federal court resolves a dispute which was
within the province of the tribal courts or of
other non-judicial law applying tribal
institutions, that court would impinge upon the
tribe's right to adjudicate controversies arising
within it. Second, if the dispute itself calls
into question the validity or propriety of an act
fairly attributable to the tribe as a governmental
body, tribal self government is drawn directly into
the controversy.. ..
We have recognized that the tribal court is
generally the exclusive forum for the adjudication
of disputes affecting the interests of both Indians
and non-Indians which arise on the reservation.
Milbank, 705 P.2d at 1119, 42 St.Rep. at 1396; citing R . J .
Williams Co. v. Fort Belknap Housing Auth. (9th ~ i r .1983) ,
719 F.2d 979, 983-84, cert.den. 472 U.S. 1016, 105 Sect.
3476, 87 L.Ed.2d 612 (1985). We therefore conclude that the
District Court here lacked subject matter jurisdiction.
However, Geiger contends that Pierce's failure to raise
the state court's lack of subject matter jurisdiction
constitutes a bar to that defense. We disagree.
... It is a fundamental axiom of our legal system
that the issue of subject matter jurisdiction may
be invoked at any time in the course of a
proceeding. Larrivee v. Morigeau (1979), 184 Mont.
187, 192, 602 P.2d 563, 566, cert.den. 445 U.S.
964, 100 S.Ct. 1653, 64 L.Ed.2d 240; Corban v.
Corban (1972), 161 Mont. 93, 96, 504 P.2d 985, 987.
Furthermore once the issue is raised and a court
determines that there is a lack of subject matter
jurisdiction, it can take no further action in the
case other than to dismiss it. Rule 12(h) (3),
M.R.Civ.P.
In Re Marriage of Lance (Mont. 19841, 690 P.2d 979, 981, 41
St.Rep. 2032, 2034.
Although Pierce could have raised the issue of the state
court's lack of subject matter jurisdiction earlier in the
proceeding, her failure to do so is not fatal to her claim.
We hold that the District Court's exercise of jurisdiction
over this matter, a civil action on a commercial transaction
brought by Geiger against Pierce, an enrolled member of the
Confederated Salish and Kootenai Tribes, arising within the
exterior boundaries of the reservation, interferes with
tribal sovereignty and the tribe's right of self-government.
The state court's jurisdiction over the subject matter was
pre-empted by tribal jurisdiction. Accordingly, we reverse
the summary judgment granted in the District Court, and
direct dismissal of the action upon remittitur.
We Concur: //
W F
Justices ~ M ~
Mr. Justice Fred J. Weber specially concurs.
While I am forced to acknowledge that federal caselaw
requires that this case be dismissed from the state district
court for jurisdictional reasons, I am not at all comfortable
with the result. As Judge McNeil said in his opinion below:
The inequity of granting Defendant's Motion to
dismiss at this stage of the instant case is obvi-
ous. At the time the commercial transaction was
entered into, the Plaintiff could not inquire into
the tribal member status of the Defendant in order
to determine in advance that a State Court forum
would be available in the event of a default on the
contract. If such an inquiry were made, the Defen-
dant could quite properly claim that her race was a
consideration in her application for credit in the
form of the installment sale contract giving rise
to a claim of discrimination based on race.
Likewise, at the commencement of this action
neither the Plaintiff nor the Court could properly
inquire into the tribal member status of the Defen-
dant because the Montana Constitution provides that
courts of justice shall be open to every person and
that no person may be discriminated against on
account of race.
This Court is not unaware of the Federal
Courts' rationale that the sovereign nation concept
is a "political classification" and not an "ethnic
classification" based on race. The Tribal Council
of the Confederated Salish and Kootenai Tribes
establishes the criteria for enrollment in said
Tribe based on a quantum of Indian blood as deter-
mined by said Tribal Council. Non-Indians are not
eligible for enrollment. The Federal Courts may
consider that to be a political classification for
jurisdictional purposes, but it surely appears to
this St-ate Court to be a distinct.ion based on race.
The Constitution of Montana provides that no
person shall be denied the equal protection of the
laws and that neither the State nor any person
shall discriminate against any person in the exer-
cise of his civil or political rights on account of
race. Sec, 4, Art. 11, Declaration of Rights. In
addition, the Constitution of Montana provides that
courts of justice shall be open to every person and
speedy remedy afforded for every injury. Sec. 16,
Art. 11, Declaration of Rights. The Montana
Constitution further provides that no person shall
be deprived of life,- liberty or property without
due process of law. Sec. 17, Art. 11,
Declaration of Riahts.
Under the holding of the United States Supreme Court as
discussed in Pierre, we are required to deny subject matter
jurisdiction, even though that issue was raised by the Indian
defendant only after the entry of judgment in the underlying
cause. As a result, I concur in the opinion reversing the
District Court.
I have a sense of frustration similar to that described
by the District Court. It seems basically unfair to allow an
Indian person to use the state courts so long as that person
decides it is to her benefit, but to deny the non-Indian
party an equivalent right of access to the same court in this
contract dispute. The plaintiff here has been placed in a
"Catch-22" position. Before the execution of the contract,
the plaintiff here was constitutionally forbidden from asking
the defendant if she was an Indian and if she was a member of
the Confederated Salish and Kootenai Tribes. When the action
was commenced by the plaintiff, there was no basis for an
inquiry by the plaintiff nor the court as to whether the
defendant was an Indian person who was a member of the Tribe
and who claimed a lack of subject matter jurisdiction. As a
result, the Indian person was allowed to proceed through the
state court trial process to the point of judgment against
her, when she concluded it was no longer advantageous to stay
in that court. At that point, she could then raise the
subject matter jurisdiction question and negative the judg-
ment against her. As a nation, we may be commended for our
attempt to protect the Indian people through our state and
federal laws. Certainly there was a long period of time when
that protection was denied to the Indian people. However, we
can be condemned for our failure to develop a just and work-
able system for both Indians and non-Indians who deal with
the Indian people. Here the plaintiff has been denied jus-
tice. In the long run, decisions of this type will insure
that the Indian people will be penalized as non-Indians
protect themselves from dealings with Indian people. I am
not proud of the result of this opinion.
Concur in the foregoing specia concurrence.
Ah