Title: Chance v. Coquille Indian Tribe

State: oregon

Issuer: Oregon Supreme Court

Document:

Filed:  July 16, 1998

IN THE SUPREME COURT OF THE STATE OF OREGON

DON CHANCE,					

	Plaintiff-Adverse Party,			

	v.							

COQUILLE INDIAN TRIBE and		
COQUILLE ECONOMIC			
DEVELOPMENT CORPORATION,	

	Defendants-Relators.		

(CC 97 CV 0913; SC S44773)

	Original proceeding in mandamus.

	Argued and submitted May 5, 1998.

	Lea Ann Easton, Native American Program, Oregon Legal
Services, Portland, argued the cause for defendants-relators
Coquille Indian Tribe and Coquille Economic Development
Corporation.  With her on the brief were Lori Irish Bauman and
Daniel H. Skerritt, of Ater Wyne Hewitt Dobson & Skerritt, LLP,
Portland.

	Steve Wilgers, Coos Bay, argued the cause and filed the
brief for plaintiff-adverse party.

	Before Carson, Chief Justice, and Gillette, Van Hoomissen,
Durham, Kulongoski, and Leeson, Justices.

	GILLETTE, J.

	Peremptory writ to issue directing the circuit court judge
to vacate the order denying defendants' motion for dismissal and
to enter an order granting that motion.	

		GILLETTE, J.

		In this contract action, an Indian tribe and a
management corporation established by that tribe seek a writ of
mandamus directing the dismissal of a former employee's contract
action against them.  They argue that they are immune from the
action under the doctrine of tribal sovereign immunity, that they
did not waive that immunity with respect to the contract at
issue, that the circuit court erroneously denied their motion to
dismiss, and that, unless we issue a writ, they will be forced to
undertake expensive and time-consuming litigation before a court
that has no legal authority to proceed.  Having considered the
parties' arguments, we conclude that the Tribe and its
corporation are entitled to the writ that they seek. 
Accordingly, a peremptory writ shall issue directing the circuit
court judge to vacate the order denying the motion to dismiss and
to enter an order granting the motion.  

		In 1997, plaintiff filed the present action against the
Coquille Indian Tribe (Tribe) and the Coquille Economic
Development Corporation (CEDCO), a tribally-owned corporation,
seeking damages for CEDCO's alleged breach of an employment
contract.  Pursuant to ORCP 21 A(1),(1)

 the Tribe and CEDCO
(collectively, "defendants") moved for an order of dismissal.  In
their motion, defendants argued that, as a duly organized Indian
tribe and a tribal business corporation, they possess sovereign
immunity from claims in state and federal courts.  They further
argued that they had not waived that immunity in their dealings
with plaintiff.  The circuit court denied defendants' motion. 
Defendants' petition for a writ of mandamus followed.  They
argue, as they did below, that the doctrine of tribal sovereign
immunity bars state court jurisdiction over plaintiff's claim.

		There appears to be little question that the Coquille
Tribe generally possesses the immunity from claims that it
asserts.  As "domestic dependent nations" with sovereign
authority over their members and territories, Indian tribes are
immune from claims in state and federal courts.  See, e.g., Kiowa
Tribe of Okla. v. Manufacturing Tech., Inc., __ US __, 118 S Ct
1700, 1704, __ L Ed 2d __ (May 28, 1998) (so stating); Oklahoma
Tax Comm'n v. Potawatomi Tribe, 498 US 505, 509, 111 S Ct 905,
909, 112 L Ed 2d 1112 (1991) (same); Santa Clara Pueblo v.
Martinez, 436 US 49, 58, 98 S Ct 1670, 1677, 56 L Ed 2d 106
(1978) (same).  Moreover, tribal immunity extends to agencies,
entities, and enterprises that a tribe creates pursuant to the
tribe's powers of self-government.  Consequently, CEDCO possesses
general immunity from such claims as well.  See, e.g., Weeks
Const., Inc. v. Oglala Sioux Housing Auth., 797 F2d 668, 670-71
(8th Cir 1986) (stating principles and holding that tribal
housing authority enjoyed same sovereign immunity as tribe);
Snowbird Const. Co., Inc. v. U.S., 666 F Supp 1437, 1441 (D Idaho
1987) (same).  See also, Central Machinery Co. v. Arizona Tax
Comm'n, 448 US 160, 164 n 3, 100 S Ct 2592, 2595 n 3, 65 L Ed 2d
684 (1980) (for purpose of tribal tax immunity, distinction
between tribe and tribal entity is irrelevant); Mescalero Apache
Tribe v. Jones, 411 US 145, 157 n 13, 93 S Ct 1267, 1275 n 13, 36
L Ed 2d 114 (1973) (same).

		Of course, tribal entities may choose to waive their 
sovereign immunity, either generally or with respect to
particular transactions, and, if they do so, their waivers are
binding.  Burlington Northern v. Blackfeet Tribe, 924 F2d 899,
901 (9th Cir 1991).  That potential for waiver is at the center
of the present dispute.  Plaintiff contends that defendants
waived their sovereign immunity with respect to the contract at
issue; defendants deny that any such waiver occurred.  		Plaintiff asserts that defendants waived their sovereign
immunity in two ways: (1) by including a blanket waiver of
CEDCO's immunity in CEDCO's Articles of Incorporation, and (2) by
including a specific waiver of defendants' immunity in the
contract itself.  Defendants deny that the contract or any other
legal document of the Tribe contains anything that qualifies as a
waiver of sovereign immunity.  

    		Courts test asserted waivers of sovereign immunity of
the kind claimed here against an exacting standard.  Federal
courts repeatedly have stated that a waiver of tribal immunity
"cannot be implied but must be unequivocally expressed."  Santa
Clara Pueblo, 436 US at 58, 98 S Ct at 1677; Stock West Corp. v.
Lujan, 982 F2d 1389, 1398 (9th Cir 1993); A.K. Management Co. v.
San Manuel Band, 789 F2d 785, 789 (9th Cir 1986); Amer. Indian
Agr. Credit v. Stand. Rock Sioux Tribe, 780 F2d 1374, 1378 (8th
Cir 1985).  One court has held, for example, that it will not
imply a waiver from the fact that a promissory note provides
specified remedies for a default "in addition to such other and
further rights and remedies provided by law" or from the fact
that a contract provides for attorney fees.  Amer. Indian Agr.
Credit, 780 F2d at 1379-81.    

		With that caveat, we turn to plaintiff's first theory
of waiver.  Plaintiff contends that the Tribe waived sovereign
immunity with respect to any of and all CEDCO's transactions by
including the following wording in CEDCO's Articles of
Incorporation:

"CEDCO shall have power to take the following actions
under such terms and conditions as the Board may
establish:

	"1. Consent to be sued in courts or to have claims
against it resolved through arbitration, provided the
exercise of this power shall not be considered a
consent to the execution or levy of any judgment, lien,
garnishment or attachment upon any rights or property
of CEDCO other than those specifically pledged or
mortgaged as security for the underlying obligation." 

Plaintiff argues that federal courts almost uniformly have held
that that kind of "sue and be sued" provision constitutes an
express and unequivocal waiver of immunity.  In so arguing,
plaintiff cites Weeks, 797 F2d at 671, and Snowbird, 666 F Supp
at 1441. 

		Defendants respond, and we agree, that Weeks and
Snowbird do not support plaintiff's argument.  Both of those
cases involved a provision in a tribal entity charter giving
direct and unqualified tribal consent "to allowing the [tribal
entity] to sue and be sued."  Weeks, 797 F2d at 671; 666 F Supp
at 41.  Such wording undoubtedly waives sovereign immunity with
respect to any action of the tribal entity.  In contrast, the
quoted wording in the CEDCO charter merely authorizes CEDCO to
give such consent.  It clearly contemplates that, unless CEDCO
takes some further action, such as offering its consent with
respect to a particular transaction, the usual rule of sovereign
immunity will apply.  The wording in the CEDCO charter is not a
blanket waiver of CEDCO's sovereign immunity.

		That brings us to plaintiff's second theory -- that
defendants waived immunity with respect to actions on the
contract at issue.  Plaintiff relies on the following provision
of his contract with CEDCO, which was drafted by CEDCO's
president, Anderson:"CEDCO and the Coquille Indian Tribe grant limited
sovereign immunity only for the enforceability of this
contract.  Enforceability jurisdiction will be under
Public Law 280."                  

Plaintiff contends that the foregoing wording is sufficient to
meet the "unequivocally expressed" standard of the federal cases. 
In particular, plaintiff contends that, in the context of the
contract as a whole, the quoted provision can mean only one thing
-- that defendants intended to and did waive sovereign immunity
for purposes of the contract.  He also relies on the fact that
Anderson stated under oath that he intended the wording to be a
waiver of immunity. 

		Defendants argue that the quoted contract provision is
incomprehensible and cannot qualify as an unequivocal waiver of
immunity.  Moreover, defendants argue, even if the contract
wording could be construed as granting a waiver, it would be
ineffective, because Anderson lacked authority under applicable
tribal law to waive sovereign immunity on either CEDCO's or the
Tribe's behalf.  We conclude that that latter argument is
dispositive, and limit our discussion accordingly.

		As noted, the contract was signed by Anderson, as
"president [of] CEDCO."(2)  Plaintiff contends that Anderson was
authorized to waive the defendants' sovereign immunity.  In
support of that contention, plaintiff points to several items of
evidence in the record: (1) Coquille Indian Tribe Resolution CY
9365, which authorizes Anderson, as president of CEDCO, to "speak
and represent the tribe in an official capacity;" (2) Coquille
Indian Tribe Resolution CY 9433, which grants Anderson "full
authority to direct, perform and oversee the economic development
work for the tribe;" (3) Section 8.5 of CEDCO's bylaws, which
provides that the president of CEDCO may enter into contracts "in
the name and on behalf of CEDCO;" and (4) Anderson's affidavit
stating that he had express authority to negotiate the contract
with plaintiff and waive sovereign immunity on CEDCO's behalf
under Resolution CY 9365 and section 8.5 of CEDCO's bylaws.  

		We note that, as it is presented in this case, the
question of Anderson's authority is purely a question of law. 
Defendants do not dispute that the tribal resolutions and charter
provisions cited by plaintiff exist, or that they may be
considered under ORCP 21 A(1).  Neither do defendants dispute the
sincerity of Anderson's belief that he had tribal authority to
waive the defendants' immunity.  The only issue concerns the
legal effect of those undisputed facts.

		Plaintiff argues that the quoted tribal resolutions
establish that Anderson was an agent for defendants and,
consequently, also establish his authority to bind those entities
with respect to any matter that they expressly or implicitly had
delegated to him.  Therefore, plaintiff argues, Anderson clearly
had actual authority to waive the defendants' sovereign immunity: 
Such authority is included in the forms of authority granted to
Anderson by the two resolutions -- to "speak" for the Tribe and
to oversee its economic development -- and also is implicit in
the power to enter into contracts on CEDCO's behalf (which had
been extended to Anderson as CEDCO president).(3)  At the very
least, plaintiff contends, the defendants had clothed Anderson
with apparent authority to waive immunity, a fact that, under
state law, would bind defendants as effectively as any grant of
actual authority.

		Defendants respond that, however comfortably
plaintiff's contentions fit into agency notions under state law,
they are contrary to the laws of the Coquille Indian Tribe. 
Under those tribal laws, defendants contend, Anderson had no
authority to bind the Tribe on his own, but could do so only with
the approval of the CEDCO Board of Directors.  Defendants
conclude that, because there is no allegation in the complaint or
evidence in the record that Anderson did obtain Board approval
before entering into the contract at issue, the only possible
conclusion is that Anderson's signature did not bind either
defendant to the contract or to the "waiver" that was contained
therein.  We agree.  

		We note, first, that nothing in the various documents
upon which plaintiff relies grants Anderson any authority to
waive the Tribe's immunity.  Although it is true that Anderson
was designated as a tribal spokesperson under tribal resolution
CY 9365, that designation cannot be construed reasonably as
conferring upon Anderson the authority unilaterally to waive
tribal immunity.  The resolution gave Anderson authority to
"speak" for and "represent" the Tribe in its public dealings, not
general authority to bind the Tribe or to perform legally binding
acts on its behalf.  

		Plaintiff also relies on tribal resolution CY 9433,
which was adopted in 1994 and which gave Anderson "full authority
to direct, perform, and oversee the economic development work for
the tribe for a minimum period of eight (8) years."  That
resolution cannot be read in a vacuum.  At the time of the
resolution, Anderson was the tribally appointed president of 
CEDCO, and his actions in pursuit of the Tribe's economic
development were subject to CEDCO's Articles of Incorporation. 
Those Articles expressly provide that CEDCO had no authority to
waive any right belonging to the Tribe.  Presumably, Anderson's
authority as CEDCO president similarly was circumscribed.         
		Neither did Anderson have authority unilaterally to
waive CEDCO's immunity.  Under section 8.5 of the CEDCO Articles
of Incorporation, Anderson had authority, as president of CEDCO,
to enter into contracts on behalf of CEDCO, but only "[w]hen
authorized by the Board."  Similarly, as president of CEDCO, he
could "sign on behalf of CEDCO all documents, contracts or other
instruments approved for execution by the Board."  Clearly,
Anderson needed Board approval to enter into contracts on CEDCO's
behalf and, consequently, also needed Board approval to waive
CEDCO's immunity.  

		As defendants point out, nothing in the record or in
plaintiff's complaint suggests that the Board had approved the
waiver at issue, either by approving the contract specifically or
by extending general approval to Anderson's contracting
activities.  Consequently, we conclude that Anderson's signature
had no binding force and that his purported waiver of CEDCO's
immunity is unenforceable.

		Peremptory writ to issue directing the circuit court
judge to vacate the order denying defendants' motion for
dismissal and to enter an order granting that motion. 

1. 	ORCP 21 A provides, in part:

	"[T]he following defenses may * * * be made by motion
to dismiss:

		"(1) lack of jurisdiction over the subject matter 

	* * *.  If, on a motion to dismiss asserting defense[]
(1) * * *, the facts constituting the defense do not
appear on the face of the pleading and matters outside
the pleading, including affidavits and other evidence,
are presented to the court, all parties shall be given
a reasonable opportunity to present evidence and
affidavits, and the court may determine the existence
or nonexistence of the facts supporting such defense

	* * *."

2. 	Carl Nelson also signed the contract as "Director of
Operations [of] CEDCO."  Plaintiff makes no argument that Nelson
had authority to waive immunity for CEDCO or the Tribe.

3. 	With regard to the latter point, plaintiff reasons that
the power to waive immunity was necessary to Anderson's authority
to contract for CEDCO:  Otherwise, any contract that Anderson
signed would be unenforceable and, ultimately, illusory.