NO. 92-531
IN THE SUPREME COURT OF THE STATE OF MONTANA
1993
VERLIN F. WIPPERT and
LORETTA L WIPPERT,
.
Plaintiffs and Appellants,
THE BLACKFEET TRIBE OF THE
BLACKFEET INDIAN RESERVATION,
Defendant and Respondent,
APPEAL FROM: District Court of the Ninth Judicial District,
In and for the County of Glacier,
The Honorable R. D. McPhillips, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Seldon S. Frisbee, Attorney at Law, Cut Bank
Montana
For Respondent:
Jean Bear Crane, Attorney at Law, Blackfeet Legal
Department, Browning, Montana
Submitted on Briefs: June 10, 1993
Decided: ~ u g u s t25, 1993
Filed:
Justice John Conway Harrison delivered the Opinion of the Court.
Loretta and Verlin Wippert (Wipperts) appeal from an order of
the Ninth Judicial District Court, Glacier County, granting the
Blackfeet Tribe's motion to dismiss the Wippertsq claims, which
originally took the form of a declaratory judgment action filed in
the District Court in 1977. We affirm.
This is the Wipperts' third appeal to this Court. After the
first appeal, we remanded the case to the District Court for
further proceedings. Wippert v Blackfeet Tribe (1982), 201 Mont.
.
299, 654 P.2d 512 (Wiwwert I .
) On remand, the District Court
entered judgment for the Tribe and the Wipperts appealed again. We
reversed. Wippert v. Blackfeet Tribe (19851, 215 Mont. 85, 695
P.2d 461 (Wiwwert 11). The Tribe then moved to dismiss for lack of
subject matter jurisdiction, leading to the appeal now before us
(Wiw~ert111).
Following is the history of this case so far as it is relevant
to the subject of the present appeal and to the issue of subject
matter jurisdiction.
Wiwwert I
In 1974 the Wipperts, who owned a 2,400-acre ranch on the
Blackfeet Reservation, borrowed $46,773 from the Blackfeet Tribe.
The loan was secured by "all cattle now owned or hereafter acquired
by the [Wipperts],I* and the security agreement provided that the
debtors would have at least five days1 notice of any sale of the
collateral. The loan, plus interest at ten percent, was due on
November 1, 3975, but on that date the Wipperts had paid only
$2,043 on the principal.
On March 8, 1976, the Tribe notified the Wipperts that they
were in default and that the Tribe intended to have the cattle
picked up and taken to market, pursuant to the security agreement.
The Tribe moved the cattle to another ranch on March 12, 1976, to
be held until they could be sold. On April 15, 1976, the Tribe
obtained a judgment in the Blackfeet Tribal Court for $44,730,
authorizing the Tribe to sell the cattle and apply the proceeds of
the sale first to the cost of feeding and shipping the cattle, and
second to the judgment balance. Notice of this judgment was filed
with the Glacier County clerk and recorder on April 21, 1976.
The cattle were sold at public auction in Shelby, Montana, on
April 19, 1976, for $38,400, of which $27,031 was applied to the
principal balance due on the Wipperts' loan. Two months later, the
Wipperts agreed to sell their ranch to a third party (the
Robertsons), but when the Robertsons discovered the Tribe's notice
of judgment they refused to accept title. The Wipperts then agreed
to hold $20,000 from the sale of the property in an interest-
bearing escrow account, pending release of the tribal court
judgment. If necessary to clear the judgment, the money was to be
used for that purpose; otherwise, it was to be returned to the
Wipperts. Because of this agreement, a title insurance policy was
issued without listing the tribal court judgment as an exception.
The ranch was conveyed to the Robertsons on July 1, 1976.
On June 29, 1977, the Wipperts filed a declaratory judgment
action against the Tribe, the Robertsons, and the title company's
agent, asking the District Court to quiet title to the real
property in the Robertsons and to declare, among other things, that
the Tribe had no right, title or interest in, nor any lien or
encumbrance on the real property or the $20,000 escrow account.
The complaint alleged that the Tribe's judgment was void as to the
Wipperts because it was obtained through fraud and because the
Wipperts had been deprived of their property--the collateral--
without due process of law.
In its answer, the Tribe counterclaimed for $17,172, the
amount still due on the Wipperts' loan, and raised as an
affirmative defense the District Court's lack of jurisdiction over
the Blackfeet Tribe. The Tribe asserted that it had not consented
to the District Court's jurisdiction and that as a federally
recognized Indian tribe, it could not be subjected to suit without
the express consent of Congress. The Wipperts moved to strike this
defense on the grounds that the Tribe had not raised it in its
first response to the complaint, which was a motion to dismiss for
failure to state a cause of action, filed on July 14, 1977 and
denied for lack of a supporting brief.
The District Court, by order dated September 19, 1977, granted
the Wipperts' motion to strike the Tribe's affirmative defense,
stating that the defense was waived as provided in Rules 12(g) and
12(h), M.R.Civ.P., "with one exception, should counsel for the
Blackfeet Tribe be able to show the court that immunity from suit
is applicable herein and not waived, and therefore ought to be
viewed as lack of jurisdiction over the subject matter rather than
person, the defense will [be] and hereby remains available."
In November 1979, after a hearing on pre-trial motions, the
District Court dismissed the title company's agent and ordered that
the escrowed funds, which then amounted to $23,444, be placed in an
interest-bearing money market certificate pending further order of
the court. The court filed its findings of fact and conclusions of
law on August 19, 1981.
In its 1981 memorandum, the District Court found that it had
subject matter jurisdiction because the subject of the lawsuit was
title to fee patent land; because it had jurisdiction to remove a
cloud from title to such land; and because it had jurisdiction over
the office of the Glacier County clerk and recorder, where the
document purporting to create a lien against the land--the Tribe's
tribal court judgment--had been filed.
The court also found that the "judgment recordcgfiled by the
Tribe in the Glacier County clerk and recorder's office was
lsinvalidand voidm as to the Wipperts and "expunged from this
court's records," because it had not been reduced to judgment in
the District Court. In general, the court determined, tribal court
judgments are not entitled to full faith and credit in a state
court because Article IV, Section 1 of the United States
Constitution does not mention tribal court judgments. The court
concluded, however, that if a state court were to rule that a
tribal court judgment is invalid, it would "infringe on the right
of reservation Indians to make their own laws and be guided by
them;" that the State of Montana should give effect to a tribal
court judgment as a matter of comity; and that the Blackfeet Tribe
therefore had "a valid and enforceable judgment" and did not need
a valid lien to reach the escrow account.
Accordingly, the court entered judgment for the Tribe on
September 17, 19Si, awarding- the Tribe $16,630 plus interest from
the date of the tribal court judgment, attorney's fees in the
amount of $4,566, and $23 in costs out of the escrowed funds. By
then, the amount originally due the Tribe as a deficiency judgment
had been reduced by amounts the Tribe had withheld from income from
the Wippertsv 120 acres of trust land. The Wipperts appealed.
We affirmed in part, holding that neither a sister state nor
an Indian tribe could enforce a judgment in a Montana court without
instituting an action in district court, pursuant to 5 26-3-203,
MCA, but that even though the Tribe had not instituted such an
action, the tribal court judgment was entitled to deference as a
matter of comity. We also affirmed the District Court's award of
judgment from the escrow fund, holding that the Wipperts, in their
escrow agreement, had agreed that the fund could be used to satisfy
any remaining tribal court judgment. Wimert I, 654 P.2d at 515.
Because the District Court had merely adopted the Tribe's statement
of the amount due from the Wipperts, however, we remanded the case
for a hearing to determine the proper amount of the judgment.
Wiwwert I1
On March 23, 1983, the District Court heard testimony on the
proper amount of the judgment. The Wipperts claimed that they owed
the Tribe nothing because 128 bulls, cows, and calves should have
been included in the sale but were unaccounted for, while the 220
animals that were sold would have produced a higher price if they
had been sold in Great Falls rather than Shelby and in the fall
rather than in the spring. The Wipperts also asserted that the
Tribe had not complied with the notice requirements of 5 30-9-
504(3), MCA.
The District Court filed its findings of fact, conclusions of
law, and judgment on March 28, 1984. It found that the Wipperts
had presented no evidence showing that they did not owe the Tribe
$17,172 at the time the Tribe filed its counterclaim, and that due
to credit given for income from the Wipperts' trust land, only
$14,330 was due and owing at the time of the March 24, 1983
hearing.
The court concluded in its 1984 judgment that the sale of the
Wipperts' cattle was commercially reasonable, under 9 30-9-507(2),
MCA, because the reasonableness of a sale depends on the manner in
which the sale is conducted, not the price received; that the steps
taken by the Tribe to notify the Wipperts of the sale amounted to
"actual noticen and met the requirements of § 30-9-504(3), MCA; and
that it was authorized by 9 30-9-504 and -511, MCA, to award
reasonable attorney's fees.
The court therefore awarded the Tribe $14,331 plus interest
from April 15, 1976, $13,465 in attorney's fees, and $23 in costs.
On April 4, 1984, the court stayed execution pending the Wipperts'
appeal.
We reversed, holding that the Tribe was required to provide
reasonable notice of the sale of collateral and that under 5 30-9-
504(3), MCA, "reasonable noticeu means at least five days' prior
written notice s the time and place of sale.
f We concluded that
the Tribe's letter of March 8, 1976, informing the Wipperts that it
intended to proceed with foreclosure, did not satisfy the
requirements of 5 30-9-504(3), MCA, and held that failure to
provide reasonable notice precluded issuance of a deficiency
judgment for the Tribe. We remanded the matter to the District
Court for further proceedings consistent with our opinion.
Wi~~ert
I11
On March 26, 1985, the Wipperts filed a memorandum of costs
and disbursements in the District Court, reporting total costs of
$1,447 for Wi~pertI and Wi~wert11. The Tribe objected, pointing
out that the Wipperts did not prevail in Wip~ertI and therefore
should recover costs only for W i ~ ~ e r t The Wipperts argued, in
11.
response, that they were the successful party in the litigation as
a whole and therefore were entitled to recover their costs,
pursuant to 5 25-10-104, MCA.
On April 3, 1985, the District Court ordered the clerk of
court to deliver to the Wipperts' attorney the funds that had been
held in escrow since 1976. By then the original $20,000 deposit
had accumulated a total of $13,444 in interest. On May 1, 1985,
the court issued its findings of fact, conclusions of law, and
judgment, vacating its previous judgments of September 17, 1981,
and March 28, 1984, and restoring to the Wipperts $3,200 in trust
income withheld by the Tribe between April 1976 and March 1983 in
partial satisfaction of its judgment against the Wipperts, plus
interest from April 1976 to the date of the order. A subsequent
order, dated May 8, 1985, denied the Tribe's objection to the
Wipperts' bill of costs and made it payable forthwith.
In its May 1985 findings of fact and conclusions of law the
court found that the tribal court's judgment was not properly filed
in Glacier County records and did not become a lien or encumbrance
against the Wippertsl real or personal property. Therefore, the
court determined that, contraryto its September 1981 judgment, the
Tribe had no claim to any part of the escrow account created in
1976, nor to the income from the Wipperts' trust land, and the
Wipperts were entitled to possession of the escrow funds, plus
interest, in their entirety, "free of any claim or possible claim
of any of the defendants in this action.I1
Concluding that the Tribe was not entitled to judgment or
relief as requested in its 1976 counterclaim, the District Court
dismissed the counterclaim and set a hearing to establish the
amount of money the Tribe had improperly withheld from the
Wipperts' trust income since 1983. The court also ruled that both
parties were entitled to attorney's fees, the Tribe because it had
been forced to foreclose its security interest, and the Wipperts
because they were "forced to secure the services of an attorney
when the Tribe instituted this action in state court to obtain a
deficiency judgment." Apparently the hearing to establish amounts
due the Wipperts was never held.
As to jurisdiction, the court repeated in its May 1, 1985,
order the following language from its September 1981 judgment:
This court has jurisdiction (subject matter jurisdiction)
based on the fact that the subject matter of this lawsuit
is the title to fee ~atent land, and its jurisdiction to
quiet the title thereto or remove a cloud from the title
thereto. Furthermore, the cloud to be removed is a
document filed in the office of the Glacier County Clerk
and Recorder, over which this court has jurisdiction.
On June 11, 1985 the Tribe filed a motion to vacate the
judgment pursuant to Rule 60(b) ( 4 ) , M.R.Civ.P., based on its
contention that the District Court lacked jurisdiction to order it
to return the Wippertsl trust income, which it had collected within
the exterior boundaries of the Blackfeet Reservation pursuant to
the tribal court judgment of April 15, 1976.
No response to this motion appears in the record. Eighteen
months later, on November 13, 1986, the Tribe filed a motion to
dismiss the case "with prejudice and in its entirety," for lack of
subject matter jurisdiction. This motion, which the District Court
granted in October 1992, is the origin of the appeal now before us.
The Wipperts moved to strike the Tribe's motion to dismiss,
contending that the District Court could not entertain a motion to
dismiss after the time in which to appeal had expired, and that the
Tribe, having asked the District Court in 1976 to enforce its
tribal court judgment, could not now claim sovereign immunity.
The Tribe argued, in response, that it had not submitted to
the court's jurisdiction but instead had filed a record of its
tribal court judgment with the Glacier County clerk and recorder
and had then been named a defendant in the Wippertsl declaratory
judgment action. Its counterclaim in that action merely requested
that the tribal court judgment be paid out of the escrow account,
which was the Wipperts' "only available remaining asset."
The District Court heard oral argument on the Wipperts' motion
to strike on January 7, 1987. Counsel were asked to brief the
issue of the Tribe's sovereign immunity, and both parties filed
briefs within thirty days.
On October 10, 1992, the District Court granted the Tribe's
motion to dismiss. In the memorandum accompanying its order, the
court stated that tribal immunity is jurisdictional and is not
waived by failure to raise it at trial or on appeal. Further, the
court found that Indian tribes are sovereign entities, generally
immune from suit, and that this immunity is co-extensive with that
of the United States. "Thus, absent an express waiver or consent
to suit," the court concluded, "this court has no jurisdiction.'*
The Wipperts appealed, raising three issues, which we have
restated as follows.
1. Whether the District Court erred in considering
a motion to dismiss filed eighteen months after the entry
of a final judgment.
2. Whether the Tribe's 1986 motion to dismiss, and
the District Court's order granting that motion, were
barred by the doctrine of res judicata.
3. Whether the District Court erred in concluding
that the Tribe did not waive sovereign immunity by acting
in its corporate capacity.
The Tribe raises a fourth issue: whether, regardless of the
Tribe's immunity, a state district court has subject matter
jurisdiction over a civil matter involving the Blackfeet Tribe and
a tribal member and arising within the exterior boundaries of the
Blackfeet Reservation. As we affirm the District Court's ruling,
which was based on its conclusion that the Tribe is immune to suit,
we need not decide whether the District Court otherwise lacked
subject matter jurisdiction to declare whether the Tribe had an
interest in or lien on the WippertsP real or personal property. We
note in passing, however, that because Montana has not assumed
civil jurisdiction over causes of action arising on the Blackfeet
Reservation, under P.L. 280 and the Indian Civil Rights Act, civil
jurisdiction presumptively lies in the tribal court. See In re
Marriage of Wellman (Mont. 1993), 852 P.2d 559, 50 St.Rep. 461, and
the cases cited therein.
I
Did the District Court err in considering a motion to dismiss
filed eighteen months after entry of judgment?
The District Court failed to act on the Tribe's timely motion
for relief from judgment; therefore, that motion was deemed denied
after forty-five days, or approximately on July 26, 1986, pursuant
to Rule 60(c), M.R.Civ.P. Once a motion has been deemed denied,
the court loses jurisdiction. In re Marriage of McKinnon (1992),
251 Mont. 347, 350, 825 P.2d 551, 553. Different rules apply,
however, to the Tribe's motion to dismiss the entire action for
lack of subject matter jurisdiction.
Jurisdiction--the right to determine and hear an issue--
transcends procedural considerations and involves the fundamental
power and authority of the court itself. Corban v. Corban (1972),
161 Mont. 93, 584 P.2d 985. It is well settled that the issue of
subject matter jurisdiction may be invoked at any time in the
course of a proceeding, and that once a court determines that it
lacks 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 (1984), 213 Mont. 182, 690 P.2d 979. See also
Big Spring v Blackfeet Tribe (1978), 175 Mont. 258, 573 P.2d 655
.
(in an action against the Blackfeet Tribe by one of its members, we
vacated a default judgment and remanded for further proceedings
because the district court had entered judgment without ruling on
the Tribe's motion to set aside the default for deficient service
and lack of subject matter jurisdiction).
Thus, the Tribe's 1986 motion to dismiss is not subject to any
time constraint. The fact that it was filed eighteen months after
judgment entered does not affect its validity, nor does the
District Court's six-year delay in ruling on the motion deprive it
of jurisdiction. We conclude that the District Court did not err
in considering the Tribe's motion to dismiss the case for lack of
subject matter jurisdiction or in ruling on it six years later.
II
Did the doctrine of res judicata bar the Tribe's 1986 motion
to dismiss and the District Court's order granting that motion?
The Wipperts contend that the District Court's order of
October 10, 1992, is barred by res judicata, but their argument
actually addresses the Tribe's right to raise the issue of
sovereign immunity in their 1986 motion to dismiss the case for
lack of subject matter jurisdiction.
The Wipperts cite Wellman v Wellman (1982), 198 Mont. 42, 643
.
P.2d 573, in which we adopted the following rule from Royal
Coachman Color Guard v. Marine Trading (Me. 1979), 398 A. 2d 382,
Once there has been full opportunity to present an issue
for judicial decision in a given proceeding, including
those issues that pertain to a court's jurisdiction, the
determination of the court in that proceeding must be
accorded finality as to all issues raised or which fairly
could have been raised, else judgments might be attacked
piecemeal and without end.
The issue in Wellman was whether the district court properly
dismissed the plaintiffs' 1981 quiet title action. The plaintiffs
claimed that the same court's 1971 judgment, which designated one
of the defendants the sole owner of the disputed property, was void
because it granted relief beyond the scope of that defendant's
pleading in the 1971 action. We concluded that the plaintiffs had
had a full opportunity to litigate the voidness issue in 1971, when
the court denied their motion to set aside default and judgment in
favor of the defendant, and held that dismissal of the 1981 action
was proper.
Here, the Wipperts assert that the Tribe's 1986 motion to
dismiss is barred because the Tribe had an opportunity to raise the
issue of sovereign immunity in Wiwwert I but failed to do so. The
record shows, however, that the Tribe did raise sovereign immunity
as a defense in 1977, in its answer to the Wipperts' original
complaint. The District Court granted the Wipperts' motion to
strike the defense but specifically reserved the issue of sovereign
immunity for later consideration, in its order of September 19,
1977.
At no time during the subsequent ten years did the Tribe have
a "full opport~nity*~ litigate the issue of sovereign immunity.
to
Although the District Court announced in its 1981 judgment, and
repeated in its 1985 judgment, that it had jurisdiction to quiet
title to fee patent land, and to wexpungew the record of tribal
court judgment filed in the Glacier County clerk and recorder's
office, it did not rule on the issue of the Tribe's immunity to
suit until 1992. Thus the doctrine of res judicata, which is
intended to prevent a party from relitigating a matter that he or
she has already had an opportunity to litigate, Brault v. Smith
(1984), 208 Mont. 21, 679 P.2d 236, does not apply in this case.
I11
Did the District Court err in concluding that the Tribe did
not waive sovereign immunity by acting in its corporate capacity?
Indian tribes have long been recognized as possessing the
common-law immunity from suit traditionally enjoyed by sovereign
powers, subject to the plenary control of Congress. Santa Clara
Pueblo v. Martinez (1978), 436 U.S. 49, 58, 98 S.Ct. 1670, 1677, 56
L.Ed.2d 106, 115. Without tribal consent or congressional
authorization, an Indian tribe is exempt from suit. United States
v. U.S. Fidelity and Guaranty Co. (l94O), 309 U.S. 506, 512, 60
S.Ct. 653, 656, 84 L.Ed. 894, 899. A tribe may consent to suit
only by an unequivocally expressed waiver of its sovereign
immunity. Santa Clara Pueblo, 436 U.S. at 58.
Other courts, following Santa Clara weblo, have endorsed the
principle that an Indian tribe cannot waive its immunity by
implication. In American Indian Agricultural Credit Consortium,
Inc. v. Standing Rock Sioux Tribe (8th Cir. 1985), 780 F.2d 1374,
for example, the Eighth Circuit overruled the district court's
determination that the tribe had impliedly waived sovereign
immunity in a contract action. "Nothing short of an express and
unequivocal waiver," the Standinq Rock court held, "can defeat the
sovereign immunity of an Indian nation." 780 F.2d at 1379. See
also Chemehuevi Indian Tribe v. California State Bd. of
Equalization (9th Cir. 1985), 757 F.2d 1047, in which the Ninth
Circuit decided that the tribe's initiation of a declaratory
judgment action against a state agency did not constitute consent
to the agency's counterclaim.
The Wipperts argue that the Tribe consented to suit in its
corporate charter, ratified on August 15, 1936, which gave the
Tribe the power Itto sue and be sued in courts of competent
jurisdiction." Federal courts of appeal, however, generally have
concluded that a Itsue and be sued" clause in a tribal corporate
charter cannot serve as a waiver of sovereign immunity if the tribe
acted only in its constitutional or governmental capacity. See,
e.g., Ramey Construction Co., Inc. v Apache Tribe of the Mescalero
.
Reservation (10th Cir. l982), 673 F.2d 315, which held that Rameyos
breach of contract claims were properly dismissed based on the
tribets sovereign immunity, despite a "sue or be suedw clause in
the tribe's corporate charter, because the tribe had acted as a
constitutional entity, not as a corporate entity.
The Wipperts contend that the Tribe waived its immunity in
1977 when it filed a claim, in federal as well as state court, for
the $17,172 remaining unpaid after the sale of the collateral. In
that claim the Tribe described itself as "a federally chartered
corporationm organized pursuant to the Indian Reorganization Act of
1934, and stated that its credit committee, which had made the
original loan to the Wipperts, had been organized as a part of its
"corporate business."
The Tribe's view, as expressed in its January 1987 brief, is
that in its transactions with the Wipperts, who were tribal
members, it acted as a "political governing body," pursuant to
section 16 of the Indian Reorganization Act. The chartered tribal
corporation formed under section 17 of the Indian Reorganization
Act is, the Tribe argues, a separate entity through which the
tribal government conducts the business of the Tribe, as opposed to
its governmental affairs.
According to the Tribe, its credit program is not a section 17
business venture but a means of promoting ranching and farming
development by allowing tribal members to borrow specifically
appropriated federal funds; earnings from these loans are not used
as profit but instead are used to repay the federal government.
Moreover, the credit program has no corporate capacity separate
from the Tribe, which exercises direct authority over the program
and the money it earns.
The District Court adopted the Tribe's view of its credit
program, finding that it sloperatesunder the direct auspices of the
Blackfeet tribal government" and "has no separate corporate
capacity," and that the Tribe exercises direct authority over it.
The court concluded that when the credit committee loaned the
Wipperts money in 1974 it was acting as an instrumentality of the
tribal government and therefore is immune from suit under the
doctrine of sovereign immunity.
We agree. The Indian Reorganization Act of 1934 authorizes
two distinct legal entities, one governed by a constitution and the
other, by a corporate charter. 25 U.S.C. 476, 477. Sovereign
immunity applies to the constitutional entity but not to the
corporate entity, for policy reasons succinctly described in
Atkinson v. Haldane (Alaska 1977), 569 P.2d 151, 174-75:
There is little doubt that the claims to sovereign
immunity have been allowed in the courts in order to
.
protect the limited and irreplaceable resources of the
-.
A
Indian tribes from larye judYments. n u w e ? v w r , rt.rrbt.
-A_-:
application of the immunity principle could severely
retard the tribe's economic growth in a modern business
world. Recognition of two legal entities, one with
sovereign immunity, the other with the possibility for
waiver of that immunity, would enable the tribes to make
maximum use of their property. The property of the
corporation would be at risk, presumably in an amount
necessary to satisfy those with whom the tribe deals in
economic spheres. Yet some of the tribal property could
be kept in reserve, safe from a judgment execution which
could destroy the tribe's livelihood, in recognition of
the special status of the Indian Tribe.
Here, however, the Blackfeet constitution and corporate
charter, taken together, do not in themselves create two distinct
entities. First, the constitution, which was approved by the
Secretary of the Interior in 1935 pursuant to section 16 of the
Indian Reorganization Act, designates the Tribal Business Council
as the Tribe's governing body and authorizes it to delegate any of
its powers to a subordinate body. Accordingly, the Tribal Council
appoints and retains complete authority over the credit committee,
which loaned money to the Wipperts and thus became a defendant in
the Wipperts' 1976 declaratory judgment action.
Second, the Tribe's corporate charter, approved pursuant to
section 17 of the Indian Reorganization Act, assigns to the Tribal
Council corporate powers that include the authority to borrow money
from the Indian Credit Fund and loan it to tribal members, as well
as the power to sue and be sued in courts of competent
jurisdiction. In assuming these powers, the Tribal Council did not
waive its sovereign immunity in the express terms required by Santa
Clara Pueblo, 430 U.S. at 58.
We hold that the District Court, having before it the
Blackfeet constitution and corporate charter, did not err in
finding that the credit committee is merely an instrumentality of
the Tribal Council.
The Arizona Court of Appeals conducted a similar analysis in
S. Unique, Ltd. v Gila River Pima-Maricopa Indian Community (Ariz.
.
App. 1983), 674 P.2d 1376. The court held that a commercial farm
operated by the Pima-Maricopa Community, or tribe, shared the
tribe's immunity because the farm was a subordinate economic
organization of the tribe acting in its constitutional capacity.
Responding to the appellant's assertion that the constitutional
Pima-Maricopa Community should be distinguished, under the Indian
Reorganization Act, from the Indian Corporation, the Arizona court
stated that:
[tlhe distinction to be made is not between commercial
and governmental functions in order to determine the
availability ofthe defense of tribal sovereign immunity.
The fact that the Community was engaged in a proprietary
function through the auspices of the [farm] is
immaterial. The Community as the governmental
organization of the tribe can, and in this case did,
operate a commercial farming venture . . . as a
subordinate economic organization of the Community. This
does not waive tribal sovereign immunity.
We reach the same conclusion with respect to the status of the
Blackfeet credit committee: it is, as the District Court correctly
determined, a subordinate organization of the Tribal Council, to
vhhich the Tribal Council has delegated its authority to borrow
money from the Indian Credit Fund and loan it to tribal members.
The Ninth Circuit specifically ruled on the issue of Blackfeet
tribal immunity in a case involving a credit committee transaction.
the credit committee asked the Bureau of Indian Affairs (BIA) to
attach funds in tribal member Kennerly's Individual Indian Money
account, as partial repayment of money Kennerly had borrowed from
the tribe. The account contained income from Kennerly's trust
land. The BIA transferred money from Kennerly's account to the
tribe, and Kennerly brought an action against the tribe, members of
the tribe's credit committee, and BIA officers to recover the
money. Without distinguishing between the credit committee and the
tribal government, the Ninth Circuit affirmed the district court's
dismissal of the tribe on grounds of sovereign immunity.
Conclusion
The Blackfeet Tribe loaned the Wipperts a substantial sum of
money and obtained a valid judgment in the Blackfeet Tribal Court
after the Wipperts defaulted on the loan. We upheld the validity
of that judgment in Wiuuert I, 654 P.2d at 515, and we reaffirm
that holding now. As the Tribe made the loan in its constitutional
capacity, it did not waive its immunity to the Wipperts' 1977
declaratory judgment action.
When the Wipperts asked the District Court to declare that the
Tribe had no interest in or lien on any assets they possessed after
the sale of their collateral, they were, in effect, attempting to
prevent the Tribe from obtaining a lien, based on the deficiency
judgment to which the Tribe appeared to be entitled, against the
land they had sold to the Robertsons or the $20,000 fund set aside
in conjunction with that sale. In the interest of protecting
tribal assets--the money still owed by the Wipperts--the Tribe had
no choice but to resist this declaration. It was then, in 1977,
that the Tribe raised the legitimate defense of sovereign immunity,
acknowledged at last by the District Court in its order of October
10, 1992.
We hold that the Tribe did not waive its immunity by loaning
the Wipperts money or by defending the Wipperts' 1977 declaratory
judgment action, and that the District Court did not err in
dismissing the Wipperts' action against the Tribe for lack of
subject matter jurisdiction, based on the Tribe's sovereign
immunity. In reaching this conclusion, we do not overrule our
I,
adoption, in W i ~ ~ e r t of the rule that tribal court judgments are
to be treated with the sane deference shown decisions of foreign
nations, as a matter of comity.
AFFIRMED.
We concur:
Chief Justice
Justice James C. Nelson did not participate in this decision.
Chief Justice J.A. Turnage specially concurred.
I concur in the majority opinion affirming the District Court
for the reason that the District Court did not have subject matter
jurisdiction. I do not agree with all that is, unnecessarily, said
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in the majority opinion.
August 25, 1993
CERTIFICATE OF SERVICE
I hereby certify that the following order was sent by United States mail, prepaid, to the following
named:
SELDON S. FRISBEE
Attorney at Law
P.O. Box 1998
Cut Bank, MT 59427-0547
amicusn
Jean Bear Crane, Attorney at Law
Blackfeet Legal Department
P. 0. Box 849
Browning, MT 59417
DARRELL T. PETERSON
Attorney at Law
Box 10
Cut Bank, MT 59427
Amicus Attorneys:
ED SMITH
CLERK OF THE SUPREME COURT
STATE OF MONTANA
-.
.
BY: