DEBORAH B. BARNES, Vice-Chief Judge.
¶ 1 Defendants/Appellants Louis Maynahonah, Marquita Caratinni, and Karen Heminokeky in their official capacities as members of the Business Committee of the Apache Tribe of Oklahoma (the Maynahonah Group) appeal from an Order of the district court awarding attorney fees and costs to Plaintiff/Appellee First Bank and Trust (First Bank).
¶ 2 In its Petition for Interpleader, First Bank alleged that on May 21, 2010, "it was requested" to "open various accounts on behalf of the Apache Tribe of Oklahoma" (the Tribe) "and its related entities...."
¶ 3 First Bank claimed that "[s]hortly after the process to open the [Tribe Accounts] was begun," it began receiving competing demands from the Defendant groups, each group claiming it was "entitled to withdraw, access or control the Funds in one or more [Tribe Accounts]." Claims between Chalepah Group and the Maynahonah Group — each of which claimed to be the properly constituted and authorized Business Committee of the Tribe
¶ 4 First Bank claimed it was entitled to interpleader because if it were to comply with the request of any of the groups, it would be exposed to double or multiple liability because of the inconsistent claims made to the Funds.
¶ 5 First Bank filed the petition on June 30, 2010, and the trial court issued its Order of Interpleader on the same day.
¶ 6 On July 16, 2010, the court entered an order in which it stated "[t]he Chalepah Group, the Maynahonah Group, and the Garton Group have settled among themselves their rights to [the Funds]," and their agreement that the Funds should be "delivered to [t]he Maynahonah Group, which is the properly constituted Business Committee of the [Tribe]."
¶ 7 On September 7, First Bank filed a "Notice of Objection to Order" to the July 16 order because, it claimed, the order failed to address or resolve the claim of Chalepah Group.
¶ 8 In response, the Maynahonah Group argued, among other matters, the trial court was without jurisdiction to award attorney fees to be paid from the Funds because the Funds were comprised of tribal funds and the Tribe had not waived its sovereign immunity.
¶ 9 On March 9, 2011, the court entered its Order awarding attorney fees and costs to First Bank in the total amount of $20,318.17 and ordered that sum "shall be paid by or on behalf of the Maynahonah Group, the persons who have current possession of the
¶ 10 In reviewing issues concerning tribal sovereign immunity, the Oklahoma Supreme Court has stated:
Dilliner v. Seneca-Cayuga Tribe, 2011 OK 61, ¶ 12, 258 P.3d 516, 519.
¶ 11 The Maynahonah Group's dispositive argument on appeal is that "[t]he trial court did not have jurisdiction to award ... attorney fees and costs against the Maynahonah Group [because] it has sovereign immunity from any claim for a money judgment against it."
¶ 12 The Tribe is a federally-recognized Indian tribe and, as such, is subject to suit only by congressional authority or by the Tribe's waiver of its immunity. Kiowa Tribe, 523 U.S. at 754, 118 S.Ct. 1700. Tribal immunity from suit is recognized as "needed to safeguard tribal self-governance." Id. at 758, 118 S.Ct. 1700. "This immunity extends to tribal officials, so long as they are acting within the scope of their official capacities." Crowe & Dunlevy, P.C. v. Stidham, 640 F.3d 1140, 1154 (10th Cir.2011) (citations omitted). For the reasons discussed herein, we conclude the trial court was without jurisdiction to award attorney fees and costs to First Bank against the Tribe's assets because the record fails to show that the Tribal Council expressly authorized the Maynahonah Group to waive the Tribe's sovereign immunity when it complied with the trial court's June 30 order requesting release of those Funds to the Tribe.
¶ 13 First Bank argues that "[b]ecause Apache tribal law is silent as to how sovereign immunity may be waived, no specific action by any tribal entity is required before waiver may occur."
¶ 14 Instead, First Bank argues that generalized and ambiguous provisions of tribal law should not control. It urges this Court to adopt the view of a Colorado appellate court that applied state agency law in determining that the tribe authorized an apparent agent to waive immunity.
¶ 15 First Bank's argument requires some context. In each of the cases upon which First Bank relies, a contract was in dispute; a contract executed by a tribal representative who had authority to execute the contract and one that expressly waived the tribe's sovereign immunity with respect to disputes arising under those contracts. The issue in those cases was whether the tribe authorized the representative to waive the tribe's immunity and what legal basis was required to demonstrate whether the tribe gave such authorization. In the present case, no contract is in dispute. First Bank repeatedly asserts it is not a stakeholder with respect to the Funds. Therefore, unlike the non-tribal parties to the disputed contracts in the cases upon which First Bank relies who did have such a stake, First Bank did not rely on any authority the Maynahonah Group may have had over the Funds. Indeed, First Bank's reason for filing the interpleader was its inability to determine who had authority to claim the Funds on the Tribe's behalf. It is in this context that we consider First Bank's first proposition.
¶ 16 First Bank relies on Stillaguamish Tribe of Indians v. Pilchuck Group II, L.L.C., No. C10-995RAJ, 2011 WL 4001088 (W.D.Wash. Sept. 2, 2011) (unpublished), for its argument that "where courts have considered questions of waiver in the absence of any clear guidance from tribal law, they have rejected the contention that generalized and ambiguous provisions of tribal law control."
¶ 17 The Stillaguamish Court reiterated that "tribes are subject to suit `only where Congress has authorized the suit or the tribe has waived its immunity,'" id. at *4 (quoting Kiowa Tribe, 523 U.S. at 754, 118 S.Ct. 1700), and that "[a] tribe's waiver of immunity must have the `requisite clarity,'" id. (quoting C & L Enters., Inc. v. Potawatomi Indian Tribe, 532 U.S. 411, 418, 121 S.Ct. 1589, 149 L.Ed.2d 623 (2001)). The court further noted that the level of clarity needed for an enforceable waiver has been refined by various cases. Thus, a waiver may have the requisite clarity even if a contract clause does not contain the words "sovereign immunity," but any such waiver must be express, not implied. In Stillaguamish, the only waiver was the express waiver in the agreement and none of the parties disputed that waiver had the requisite clarity. The question was whether the tribe agreed to the waiver.
¶ 18 As First Bank states, the court rejected the tribe's argument that because it did not expressly authorize the official to sign the agreement the debate was ended.
Id. at *5 (footnote omitted). The court went on to observe, however, that at the time the official signed the agreement,
Id.
¶ 19 It was in light of these circumstances — no express policy or procedure and an inconsistent practice of authorizing the waiver of sovereign immunity — that the Stillaguamish Court concluded the absence of the tribe's express authorization to waive immunity did not end the debate as to whether the tribe actually authorized the CEO to waive its sovereign immunity. However, upon consideration of the undisputed facts presented, the court found, as a matter of law, that no facts revealed the tribe's approval of the waiver of immunity for disputes arising out of the agreement. Id. at 6, 7.
¶ 20 Though not referenced by First Bank, the Stillaguamish Court also expressly rejected the agency principles proffered by the non-tribal defendant to establish the official's authority to act on the tribe's behalf. Id. at *5. The court specifically discussed the "thorny choice of law questions" raised by the defendant's argument. Id. The court noted that the defendant had not adequately explained why state law should apply to questions of tribal authority, or explain how such an "approach avoids the Supreme Court's admonition that `tribal immunity is a matter of federal law and is not subject to diminution by the States.'" Id. (quoting Kiowa Tribe, 523 U.S. at 756, 118 S.Ct. 1700).
¶ 22 Although the Stillaguamish Court specifically declined to adopt the conclusion and reasoning in another case upon which First Bank relies, Rush Creek Solutions, Inc. v. Ute Mountain Ute Tribe, 107 P.3d 402 (Colo.App.2004), First Bank argues Rush supports its contention that state apparent authority principles should apply to determine whether a tribe has waived sovereign immunity. As was true in Stillaguamish, the waiver contained in the disputed contract expressly waived the tribe's immunity. Id. at 406. In Rush, the Colorado appellate court applied state apparent authority principles to determine that the tribe authorized the chief financial officer (CFO) to waive immunity.
¶ 23 In Rush, the tribe argued that pursuant to its constitution, the tribal council was the "governing body with exclusive power over tribal matters" including the right to waive immunity, and the tribal council never gave the CFO authority to waive its immunity. Id. at 406. The court said, however, that the authority to waive sovereign immunity may be implied — even though waiver of immunity must be express, not implied. It rejected a federal district court's conclusion that because waivers of sovereign immunity must be clear and express, the authority to waive immunity must also be expressly granted. The Rush Court said it found nothing in the federal cases to mean that "because waivers of sovereign immunity must be express, the authority to sign admitted waivers cannot be established by apparent authority." Id. at 407 (emphasis added). The court also concluded that inasmuch as the tribe's constitution did not speak to the issue of apparent authority, or prohibit or refute it, general laws of agency govern. It then applied Colorado's laws concerning apparent authority.
¶ 24 Among the Colorado common law upon which the Rush Court relied is that apparent authority is established by evidence of the principal's words, written or spoken, or other conduct of the principal "which, reasonably interpreted, causes a person to believe that the principal consents to have the act done on his behalf by a person purporting to act for him." Id. (citation omitted). The court reasoned that the policy supporting apparent authority — an authority that is not actual or express — is for the protection of "third parties who, in good faith, rely upon their belief that an agency relationship exists between the apparent principal and agent." Id. (citation omitted). Further, under Colorado law, if the agent is acting pursuant to apparent authority, the agent can make the principal responsible for his or her actions regardless of the principal's knowledge about the agent's conduct.
¶ 25 The court stated that ordinarily the issue of apparent authority is a question of fact that requires a hearing. In Rush, the issue of the CFO's apparent authority had not been addressed by the trial court. Id. at 406. However, the court concluded the undisputed facts allowed it to make that determination on appeal as a matter of law. According to the court, at all relevant times: the CFO was authorized to enter into contracts on behalf of the tribe; the contract at issue designated the tribe as the customer; the CFO signed on behalf of the customer on a line designated for authorized signatures; the plaintiff and the tribe performed their respective duties under the contract, including the making of payments by the tribe to the plaintiff, for eighteen months before the dispute arose; and the tribe's "Constitution
¶ 26 Although First Bank discusses parts of Stillaguamish and Rush, it offers no argument about why or how the reasoning in those cases, particularly Rush,
¶ 27 The Stillaguamish and Rush Courts specifically looked to the particular circumstances before them, including the words and conduct of the requisite governing body, to determine whether that body conferred such authority. First Bank points to no facts — and we can discern none — in the present lawsuit concerning the words or conduct of the Tribal Council that demonstrate it conferred the authority to waive immunity on the Maynahonah Group. Instead, First Bank appears to be making the argument that, in the absence of an identified procedure or process by which the Tribe can authorize waiver of its immunity, anyone who is authorized to act on the Tribe's behalf for any particular purpose is by virtue of the authority to act, authorized to waive the Tribe's immunity. We do not read Stillaguamish or Rush as advocating such a far — reaching result and we decline to do so as well.
¶ 28 In the present case, pursuant to Article V of the Apache Constitution,
The record contains no resolution authorizing the Maynahonah Group to waive the Tribe's sovereign immunity in seeking return of the Funds in the interpleader action. No particular policy or procedure appears in the record on appeal about how the Tribal Council could authorize the Business Committee, or any other tribal official or entity, to waive immunity. However, unlike the circumstances in Stillaguamish, nothing in the record reveals the Tribal Council engaged in an inconsistent "practice for authorizing people to ... waive sovereign immunity on its behalf." 2011 WL 4001088 at *5. As we read Stillaguamish, the consistency of the tribe's practice is critical in determining whether the governing body authorized waiver of immunity when tribal policies and procedures are silent on the matter.
¶ 30 Based on the facts of this case, we conclude the Tribal Council conferred no express or implied authority on the Maynahonah Group to waive the Tribe's sovereign immunity as to the Funds. Consequently, we do not address the question of whether waiver of the Tribe's immunity was effected through the Maynahonah Group's compliance with the Order of Interpleader to gain release of the Funds to the Tribe needed to operate essential governmental and social tribal services and programs.
¶ 31 First Bank concedes the interpleader action and the ancillary award of costs and attorney fees were against tribal funds.
¶ 32 Yakima involved application of the Indian General Allotment Act, 25 U.S.C. § 348 (2012), an Act authorizing, among other matters, taxation of fee-patented land, to the County of Yakima's imposition of an ad valorem levy on taxable fee-patented land within its jurisdiction and held by the Yakima Indian Nation or its members on the tribe's reservation within the county. Referencing the 1906 amendment to the Act — the Burke Act — the Yakima Court said, the Act "manifest[ed] a clear intention to permit the state to tax" fee-patented Indian lands. 502 U.S. at 259, 112 S.Ct. 683 (citation omitted). At issue in Yakima, however, was the Tribe and United States' contention that subsequent legislation repudiated this explicit conferral of a state's taking authority "at least within the confines of an Indian reservation." Id. at 260, 112 S.Ct. 683. The Court did not agree. Id. at 261-66, 112 S.Ct. 683. However, it did find a difference between the two separate taxes Yakima County sought to impose: an ad valorem tax and an excise tax on sales.
¶ 33 As to the ad valorem tax, the Court said, "Liability for the ad valorem tax flows exclusively from ownership of realty on the annual date of assessment. The tax ... creates a burden on the property alone." Id. at 266, 112 S.Ct. 683 (citations omitted). Therefore, the Court concluded, "this ad valorem tax constitutes `taxation of ... land' within the meaning of the General Allotment Act and is therefore prima facie valid." Id.
¶ 34 We do not agree with First Bank's assertion that Yakima, and the other precedent upon which it relies, are authority that "plainly demonstrate that tribal sovereign immunity does not bar the exercise of in rem jurisdiction over tribal property, even when a tribe loses some part of that property as a result."
¶ 35 Consequently, First Bank's authority fails to support the conclusion that recognition of a tribe's sovereign immunity rests on whether the judicial proceedings are in the nature of an in rem or an in personam action. That is, nothing in the cases presented demonstrates why an interpleader action, in which tribal funds are placed within the jurisdiction and control of a state district court, are exempt from the requirement that judicial proceedings may not be commenced against a federally-recognized tribe absent express congressional authority or through the consent of the tribe. The Tenth Circuit, however, has had occasion to determine whether sovereign immunity is a bar to interpleader in Bank of Oklahoma v. Muscogee (Creek) Nation, 972 F.2d 1166 (10th Cir. 1992).
¶ 36 In that case, among other things, the district court dismissed the Bank's interpleader action based on the Nation's sovereign immunity and requirements that the parties exhaust tribal court remedies. Id. at 1168. In examining the district court's finding that it was without subject matter jurisdiction over the interpleader action, the appellate court reiterated the rule that "[s]uits against Indian tribes are barred by sovereign immunity absent either a clear waiver by the tribe or congressional abrogation." Id. at 1169 (citations omitted). "The Bank argues for an exception to this well settled law in the case of an interpleader.... [W]e hold that no such exception is warranted." Id.
¶ 37 We recognize the facts in Bank of Oklahoma differ from the present case in that there the Muscogee (Creek) Nation did not comply with any order of the district court as did the Maynahonah Group in this lawsuit, and the Muscogee (Creek) Nation, unlike the Apache Tribe, has a tribal court system.
¶ 38 We are also persuaded by the conclusion reached in Bank of Oklahoma because of the particular facts presented in this lawsuit. The Funds here are very different from the fee-patented lands in Yakima and the other cases upon which First Bank relies. The res at issue is money used as tribal operating funds. At all times, First Bank knew the Funds belonged to the Tribe. Moreover, the record demonstrates First Bank knew the Funds were assets of the Tribe immediately needed for the operation of its daily governmental functions and social services for its citizens. These are matters clearly within the Tribe's sovereign powers, powers this Court would directly infringe if the Funds were subject to erosion through interpleader.
¶ 39 In light of our conclusion that this interpleader action is barred by sovereign immunity because the tribe did not waive immunity, the trial court was without jurisdiction to award attorney fees and costs to First Bank pursuant to 12 O.S.2011 § 2022(D).
¶ 40 We conclude the Tribe, under the facts of this case, did not authorize the Maynahonah Group to waive its sovereign immunity. Consequently, based on the applicable law and facts, the Tribe did not waive its sovereign immunity when the Maynahonah Group complied with the Order of Interpleader and submitted an order to the trial court seeking release of the Funds to the Tribe. Further, we conclude sovereign immunity bars an action of interpleader against a federally-recognized Indian tribe in the absence of the tribe's clear and express waiver of immunity or congressional consent to such waiver. Because no such waiver occurred in this case, the trial court was without jurisdiction to award attorney fees and costs to First Bank from the Funds. Accordingly, we reverse the district court's Order.
¶ 41
WISEMAN, J., concurs.
THORNBRUGH, J. (sitting by designation), dissents.
THORNBRUGH, J. (sitting by designation), dissenting.
¶ 1 I respectfully dissent. The disputed funds were interplead specifically so that they would be held under the protection of the force of law of the sovereign state of Oklahoma. The tribal appellants neither objected nor sought to remove the matter to federal court, where they were involved in a dispute involving some of the same issues surrounding authority to assert control on behalf of the Tribe. Indeed, there is a strong case to be made that, at the time of the interpleader, it was uncertain as to which group would ultimately prevail in the ongoing leadership struggle within the Tribe itself.
¶ 2 Against this backdrop of uncertainty the Maynahonah group seemed quite content to allow the Oklahoma district court to enter an order directing the Bank to pay the funds into court in order to protect the funds until such time as the Tribe could sort out who had the right to control the account. The Maynahonah group then took full advantage of the power of the Oklahoma court to distribute the interplead funds in an order that the group agreed to
¶ 3 I dissent from any notion that the Tribe may now assert sovereign immunity to defeat the authority of the Oklahoma district court to enter an order awarding statutory costs and attorneys fees associated with a state interpleader action to which the tribe did not object. I would hold the Tribe waived any claim it may have had to sovereign immunity under the circumstances of this case. I would invoke the maxim
¶ 4 I make no comment as to whether the fee awarded the Bank was proper or equitable since I am unable to reach this question given the decision of the majority.
Article III of the Apache Constitution also states the Tribal Council is "[t]he supreme governing body of the" Tribe. R. at 123. Article VI sets out the requirements for and purposes of an annual meeting of the Tribal Council and for the calling of special meetings of the tribal council. R. at 123-24.
Chalepah Group is comprised of the members of the former Business Committee; the Maynahonah Group is comprised of those who claimed to have been duly elected at the March 20, 2010 election. The contest between these two groups concerned, in part, a challenge by the Tribe's Election Board (the Board) to the March 20 election. R. at 190. The Board filed a protest with the regional office of the Bureau of Indian Affairs (BIA) because it believed the election was tainted. On May 19, 2010, the BIA made an interim decision that the Board had no authority under the Tribe's election ordinance to protest an election; it only had authority, after an election, to decide protests for a recount and no such protest for recount was made. Further, in a letter dated May 19, 2010, the BIA recognized, on an interim basis, "Louis Maynahonah (the putative winner of the March 20, 2010 election) as the Chairman of the [Tribe]." R. at 158. In a letter dated May 25, 2010, the BIA clarified its intent to recognize all of the members of the Maynahonah Group as composing the Business Committee. R. at 160. Citing concerns about the ability of the Tribe to provide essential services to its members and to avoid disruption of those services as well as uninterrupted operation of its economic enterprises, on June 8, 2010, the BIA made its May 19 decision "effective immediately." R. at 161.
Meanwhile, on May 20, 2010, Chalepah Group held a meeting of the Business Committee at which it voted to adopt a resolution dated May 14, 2010, to open bank accounts for the Tribe with First Bank and to grant banking privileges to certain individuals, themselves. R. at 162-63, 164. It is unclear from First Bank's petition when the Funds were actually deposited with it, but the contest between Chalepah Group and the Maynahonah Group concerned which group had tribal authority over the Funds.
On June 1, 2010, the Board filed an appeal of the May 19 BIA decision disavowing the Board's authority to protest the election to the Interior Board of Indian Appeals. R. at 190. On June 16, 2010, the Office of the Secretary of the Department of the Interior assumed jurisdiction over the appeal. On June 19, the Tribal Council, "the Supreme Governing Body of the [Tribe]," determined at its annual meeting that the Maynahonah Group was the numerical winner of the election. R. at 185, 190. In an interlocutory order issued by the Assistant Secretary-Indian Affairs of the Department of Interior on June 25, the Regional Director of the BIA was instructed to determine whether the June 19, 2010 tribal council meeting was valid and whether the vote to ratify the election results was a valid act of the Tribal Council. The decision of the Regional Director was that while the Tribal Council meeting "may not have conformed perfectly to the Tribe's Constitution, it presented the membership the opportunity to address the issue of the validity of the March 20, 2010 election a second time" and, with a majority present, tribal members were able to conduct business pursuant to the Tribe's Constitution. R. at 192. Based on the Tribal Council's actions, the Regional Director also recognized the Maynahonah Group as the duly elected members of the Business Committee until the next election in 2012.
The position of the Maynahonah Group is that prior to the date the interpleader action was filed, First Bank had been supplied with three BIA letters that recognized the Maynahonah Group as the winner of the Tribe's election, R. at 142 & Ex. A, and had been notified that the Tribal Council determined at its annual meeting on June 19, 2010, that the Maynahonah Group was the numerical winner of the election. R. at 142-43,185. The Maynahonah Group further claimed First Bank had notice that on July 1, 2010, one day after the interpleader action was filed and the order issued, but before the lawsuit had been served, the BIA "made a final decision that the Maynahonah Group was the rightful leaders of the [Tribe] based on the June 19, 2010 tribal council meeting." R. at 144 (p. 5 of Response), 190-94. The Maynahonah Group, therefore, argued that First Bank had no reason to file the interpleader which deprived the Tribe of critically needed funds necessary for essential governmental services.
First Bank's position, however, is that the Maynahonah Group's interpretation of the BIA letters, including the July 1, 2010 letter, did not necessarily resolve all of the concerns of the competing groups and First Bank's attorneys remained concerned about the letter's effect on those other groups. R. at 200, n.3. It referred to letters and emails it received, respectively, on June 8, 2010, R. at 108, and June 18, 2010, R. at 112, from attorneys for the other groups that stated their claims to the Funds. In addition, it referenced an undated letter signed by the Assistant Secretary of the Department of the Interior (Interior) that, in light of the facts surrounding the appeal of the election results, "[f]ollowing tribal law, [Interior] will continue to recognize the incumbent members of the [Business Committee] as the Tribe's governing body." R. at 115. First Bank received this letter on June 18, 2010, from the attorneys for Chalepah Group. First Bank, therefore, argues it was still exposed to liability from multiple claims upon the Funds.
Further, the only Tribal Council resolution of record in this case is the June 19, 2010 resolution declaring the Maynahonah Group the properly elected and constituted Business Committee. R. at 185. The last paragraph of that resolution states that, as the supreme governing body of the Tribe, the Tribal Council is the sole interpreter of the Apache Constitution. R. at 188. The passage of this resolution at the constitutionally mandated annual meeting and the Tribal Council's assertion of at least one of its powers as the supreme governing body, suggests the Tribe is consistent as to the process by which it transacts its business.