No. 89-280 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

STATE OF MONTANA, 

Plaintiff and Appellant, 

-vsHERB SCHAEFFER, 

Defendant and Respondent. 

APPEAL FROM: The 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: 

Hon. Marc Racicot, Attorney General, Helena, Montana 

James C. Nelson, County Attorney, Cut Bank, Montana 

For Respondent : 

David F. Stufft; Frisbee, Moore, Stufft & Olson, 

Cut Bank, Montana 

Filed: 

Submitted on Briefs: July 20, 1989 

Decided: October 19, 1989 
Justice John Conway Harrison delivered the Opinion of the 

Court. 

This is an appeal from the District Court of the Ninth 

Judicial District, Glacier County, Montana, wherein the 

District Court granted the defendant's motion to dismiss 

based on lack of jurisdiction because the matter occurred 

within the exterior boundaries of the Blackfeet Indian 

Reservation. We reverse. 

Defendant/respondent Herb Schaefer, a non-Indian, was 

charged in the Glacier County Justice Court on March 16, 

1988, with violations of Montana pawnbroker laws, including 

the charging of excessive interest rates as a pawnbroker in 

violation of SS 31-1-401 and 31-1-407, MCA; and in failing to 

keep a pawnbroker's register in violation of 85 31-1-402 and 

31-1-407, MCA. 

The three misdemeanor offenses filed against Schaefer 

in justice court included these two offenses: 

COUNT ONE 

[Tlhe above named Defendant committed the 

offense of CHARGING [Garnet Bear Child] 

EXCESSIVE INTEREST AS A PAWNBROKER, a 

MISDEMEANOR, in violation of Section 

31-1-401 & 31-1-407 MCA. 

COUNT TWO 

[Tlhe above named Defendant committed the 

offense of CHARGING [Margaret Wippert] 

EXCESSIVE INTEREST AS A PAWNBROKER, a 

MISDEMEANOR in violation of Sections 

31-1-401 & 31-1-407 MCA. 

It is of interest to note that the officer who brought 

these charges in the justice court is an enrolled member of 
the Blackfeet Indian Tribe, employed by the Bureau of Indian 

Affairs and was not employed by any State agency or the 

Glacier County Sheriff's Department. During the 

investigation by this officer, there was, at that time, no 

ordinance under which charges co,uld be brought against 

Schaefer in the Blackfeet Tribal Court. Consequently, 

charges were sought in justice court. 

Schaefer moved to dismiss the complaint in the justice 

court on the ground that the State did not have jurisdiction 

to criminally prosecute him since the alleged offenses 

occurred within the exterior boundaries of the Blackfeet 

Indian Reservation and because the persons involved in the 

transactions with which he was charged were Indians. The 

justice court rejected Schaefer's motion to dismiss and, 

after a bench trial, Schaefer was fo.und guilty of Counts I 

and 11, charging excessive interest rates, misdemeanors, and 

not guilty of failing to keep a pawnbroker's register. 

Schaefer was imposed with a $100 fine each on Counts I and 

11. 

Schaefer appealed to the District Court and renewed his 

jurisdictional objection by filing on March 9, 1989, a motion 

to dismiss. After the filing of briefs and oral argument the 

District Court, on April 11, 1989, granted defendant's motion 

to dismiss on the ground that the State lacked jurisdiction. 

The State now appeals the District Court's order 

granting defendant's motion to dismiss and raises the 

following issue on appeal: Does the State of Montana have 

jurisdiction to criminally prosecute a non-Indian defendant 

for violation of the Montana pawnbroker statutes where the 

alleged offenses occur within the exterior boundaries of an 

Indian reservation and involve transactions with Indians? 

Garnet Bear Child and Margaret Wippert are enrolled 

members of the Blackfeet Tribe who live and reside on the 
Blackfeet Indian Reservation. Schaefer, as previously noted, 

is a non-Indian and his place of business is located within 

the exterior boundaries of the Blackfeet Indian Reservation 

in Browning, Montana. 

Concerning the loans which were the basis of Schaefer's 

charges, the State contends Schaefer's conduct, charging Bear 

Child and Wippert an interest rate of 1228% and 869% per 

annum, is neither a "small matter" nor "merely an 

overcharge." Additionally, the State claims that the federal 

government, whether or not it has jurisdiction, has neither 

the time, money, nor staff to supervise, regulate and control 

reservation pawnshops. 

Schaefer argues that by virtue of Blackfeet Tribal 

Resolution No. 5-89, he is authorized and regulated by the 

Tribe to do business as a pawnbroker. However, Resolution 

No. 5-89 was procured from the Tribal Council by Schaefer and 

his attorneys in preparation for the trial in justice court. 

The Resolution was adopted by the Blackfeet Tribal Business 

Council on October 6, 1988, some nine months after Schaefer's 

commission of the offenses and two working days before 

Schaefer's case was scheduled for trial. 

The District Court, in granting Schaefer's motion to 

dismiss, held that State v. Greenwalt (1983), 204 Mont. 196, 

663 P.2d 1178, is controlling. We do not agree. In 

Greenwalt, the District Court held that the State lacked 

jurisdiction to prosecute the defendants for crimes committed 

against Tribal members on an Indian reservation. Neither 

Tribal law nor Federal law had provided against such 

misdemeanor offenses. In the case at bar, unless the State 

had brought these charges against Schaefer, Bear Child and 

Wippert, Indian citizens of Montana, would be without the 

State's protection for offenses committed on an Indian 

reservation by a non-Indian. 
In two recent cases, State v. Thomas (Mont. 1988), 760 

P.2d 96, 45 St.Rep. 1627; and Brown v. District Court of the 

Seventeenth Judicial District (Mont. 1989) , 777 P.2d 877, 46 

St.Rep. 1242, this Court assured the Indian citizens of this 

State the protection of its laws where neither the Tribal 

Court nor the Federal government provided such protection. 

While Brown involved the regulation of the sale of liquor and 

the licensing of the same on an Indian reservation by 

Indians, this Court held that the State did have the power to 

prosecute, in State court, violations of State liquor laws 

which occur within the borders of an Indian reservation by 

Indian people. 

In Thomas, this Court held that our State courts have 

jurisdiction over non-Indians charged with violations of the 

accident reporting law, S 61-7-108, MCA. There, the 

defendant, a non-Indian, was charged with violating this 

provision after his vehicle struck a calf owned by an Indian 

family. We held that even though the accident occurred on a 

reservation, and the property damaged belonged to an Indian 

family, the State nonetheless had jurisdiction to prosecute 

the defendant under the State statute. In Thomas, it was 

irrelevant to our conclusion that the calf was owned by an 

Indian family. It is equally irrelevant to the conclusion we 

reach here that the victims of Schaefer's violations were 

members of the Blackfeet Tribe. 

Two elements are to be considered here, those elements 

expressed in this Court's recent opinion in Thomas on 

"victimless crimes," and the rights of Indian citizens of 

this State to be protected by our laws. Bonnet v. Seekins 

(1952), 126 Mont. 24, 243 P.2d 317; and State ex rel. 

Kennerly v. District Court (1970), 154 Mont. 488, 466 P.2d 

85. Here, as in Thomas, Schaefer failed to discharge a 

reporting duty. In Thomas the defendant failed to report a 
traffic accident. In the case at bar Schaefer failed to 

obtain a county pawnbroker license. While so doing Schaefer 

created victims by charging outrageously high interest rates, 

as well as violating the laws of this State. 

This Court, in State ex rel. Kennerly, 154 Mont. at 

493, 466 P.2d at 88, noted: 

The jurisdiction problem arising 

from civil and criminal legal 

relationships between Indians and 

non-Indians has been before the courts of 

this state since statehood. With some 

25,000 Indian citizens living on or near 

one of some seven reservations in the 

state, it is understandable that the 

problem is not new however, because of 

the duality of the Indian's legal status 

each case must be considered in light of 

both state and federal relationships. 

Indians resident in Montana, 

whether they be full blood or partial 

blood, allotted or unallotted, domiciled 

on the reservation or off of it, of one 

tribe or another, or whatever their 

status, are citizens of the State of 

Montana. They are entitled to the 

protection of our laws and are 

responsible to our laws. . . 

Montana's constitution provides to all citizens, Indian 

and non-Indian alike, equal protection of its laws. The 

Indian citizens of this State are entitled to the protection 

of the laws which license and regulate pawnbrokers. Montana 

has a substantial and important interest in protecting all of 

its citizens from dishonest pawnbrokers. This purpose is 

effectuated by requiring accurate and detailed records of 

transactions in the event authorities need to trace stolen 

merchandise. The records of transactions also prevent the 

charging of excessive rates of interest. Regardless of where 

the pawnshop i.s located, whether on or off the reservation, 
the business is open to the entire public. The State has a 

substantial interest in protecting all citizens against such 

violations. 

The decision of the District Court is reversed and 

remanded. 

We concur: 

/-9 

Jutices 
Justice Fred J. Weber dissents as follows: 

The State of Montana does not have jurisdiction over a 

criminal offense by a non-Indian against an Indian, committed 

within the exterior boundaries of the reservation. This was 

the holding in Greenwalt, wherein this Court affirmed the 

District Court's dismissal of criminal charges against a 

non-Indian based on lack of State jurisdiction. In 

Greenwalt, two non-Indians stole five calves on an Indian 

reservation. One of these calves belonged to an Indian. The 

charges against the Greenwalts, relating to the theft of this 

calf were dismissed on the grounds that the State lacked 

authority to prosecute. In Greenwalt we affirmed the 

dismissal, holding that the State did not have jurisdiction. 

In Greenwalt, this Court stated: 

In Williams v. United States (1946), 327 U.S. 

711, 714, 66 S.Ct. 778, 780, 90 L.Ed. 962, 964, the 

United States Supreme Court stated: 

"While the laws and courts of the State of 

Arizona may have jurisdiction over offenses 

committed on this reservation between persons 

who are not Indians, the laws and courts of 

the United States, rather than those of 

Arizona, have jurisdiction over offenses 

committed there, as in this case, b~ -- one who 

--- is not an Indian against ---- one who is an 

Indian. " 

The 1982 edition of Felix S. Cohen's Handbook 

of Federal Indian Law, states at page 353, relying 

upon Williams: 

"Criminal offenses by non-Indians against 

Indians or their property are subject to the 

Indian Country Crimes Act [18 U.S.C. 5 131. 

The Supreme Court has stated that federal 

court jurisdiction under this Act is exclusive 

of state court jurisdiction." 
- See, American Indian Lawyer Training Program, Inc., 

Justice in Indian Country (1980) 32, and Manual of 

Indian Criminal Jurisdiction (1978 Supp.) 73a; 

Getches, Rosenfelt and Wilkinson, Federal Indian 

Law (1979), 388 ("c. Crimes by a Non-Indian Against 

an Indian : State courts cannot have 

jurisdiction.") 

Greenwalt, 663 P.2d at 1182-83. 

In Greenwalt the remaining charges were later dismissed 

for insufficient evidence. However, that is irrelevant to 

the issue of jurisdiction in the present case because those 

charges did not involve a crime against an Indian. I 

conclude that the facts of Greenwalt are not distinguishable 

and the holding should control the present case. We further 

note that the majority can find no comfort in the language 

quoted from State ex rel. Kennerly, since that case involved 

a civil dispute. 

Concurrent State and federal jurisdiction may lie where 

the crime is "victimless." See, Cohen, Felix S., Handbook - of 

Federal Indian Law, 353, n.4 (1982); State v. Flint 

(Ariz.App. 1988), 756 P.2d 324. The majority opinion 

analogizes to Thomas in concluding that the present case 

involves a victimless crime. In Thomas we determined that 

the crime was "the failure to discharge a reporting duty, not 

infliction of damage upon property belonging to an Indian." 

We concluded that the crime was therefore victimless for 

purposes of determining jurisdiction. In the present case, I 

fail to see how charging interest of 869% to 1228% is a 

victimless crime. Examples of victimless crimes include 

possession of illegal drugs, pornography, violation of 

motorcycle helmet laws, gambling or tax evasion. The Indians 

doing business at Mr. Schaefer's pawn shop, who were being 

charged interest in excess of 800%, certainly must be classed 

as victims. 
The opinion states that the Indian citizens of our State 

are entitled to the protection of laws regulating 

pawnbrokers, yet concludes that the crime is victimless. 

This is inconsistent. While I understand the desire of this 

Court to provide a means by which this defendant may be 

punished, I simply cannot agree that this is a victimless 

crime or that the State has jurisdiction. Our desire to see 

justice done stems from the fact that there - are victims in 

the present case. I would affirm the District Court. 

Justice William E. Hunt, Sr., concurs in the foregoing dissent. 

Justice