John Paul Stevens: We will now hear argument in case of City of Sherrill, New York against the Oneida Indian Nation of New York. Mr. Sacks, whenever you're ready.
Ira S. Sacks: Justice Stevens, and may it please the Court: With the Court's permission, the state of New York, as amicus, will address issues related to the Treaty of Buffalo Creek and I will address the other reasons why aboriginal title and other Indian possessory rights to the properties at issue were extinguished long before the Oneida Indian Nation purchased the properties in 1997 and 1998. The asserted basis for tax immunity in this case appears at page 1 of respondent's brief which is that the Oneidas have at all times held a tribal possessory right in the properties. But even if there was a tribal possessory right, aboriginal title or under the Treaty of Canandaigua, in 1805 and 1807 when these properties passed out of tribal hands, the passage of 190 years has extinguished that right. For 190 years, these properties have been in private non Indian hands, have been freely alienable, have been transferred to numerable purchasers and have been subject to a full panoply of state and local laws including taxation.
Anthony M. Kennedy: Well, is it your position that whenever an Indian transfers land in violation of the Nonintercourse Act, that that's a valid transfer? And if not, why is this different?
Ira S. Sacks: No. It is not our position that that would be a valid transfer if there was a violation of the Nonintercourse Act. The principal issue here is whether, after of the passage of 190 years, there remains a possessory right. If there was a violation of a Nonintercourse Act in 1805 and 1807, Justice Kennedy, we believe the Oneida Indian nation has a... under this Court's decision has a federal common law damage suit against New York state or against the United States of America for failing to exercise its fiduciary duty. But after 190 years, in 1997, they did not have a possessory right to these properties. The possessory right we're talking about, aboriginal title or some other tribal possessory right, isn't just the concept. As this Court has defined aboriginal title of those possessory rights, it's a right to current possession. And under this Court's decisions in cases such as Felix versus Patrick and Yankton Sioux and Williams and Mitchell and Santa Fe, all of which were cited in the dissent written by Justice Stevens, though there was a dissent in Oneida II, tribal possessory rights are barred by that passage of time, the change in the character of the land and the innumerable innocent purchasers.
Stephen G. Breyer: Why does not having a possessory right mean that the city could tax them or the state?
Ira S. Sacks: The basis for the tax immunity here is that this land does not have Indian country status. For this land to have Indian country status, it has to be, in our view, under this Court, the Venetie decision. Federal set asides and federal superintendents. If you look at how the Oneida Indian nation got this land in 1997, it wasn't because of any set aside by the Federal Government in 1794 even if there was and I will get you that later.
Stephen G. Breyer: No, I'm just thinking, suppose you have a reservation but the tribel doesn't have a possessory right because in the middle of the reservation, there is some kind of long term lease or sale to a house that's owned by somebody else who is not a member of the tribe. I would think... am I right that the city or the county in which that reservation sits can't tax it anyway?
Ira S. Sacks: I absolutely agree with you.
Anthony M. Kennedy: All right. So if you were to say the tribe does not have a possessory right, they can't go and eject all the people who are living there and built houses over the last 192 years. That doesn't mean still that you could tax them.
Ira S. Sacks: But your hypothetical, Your Honor, presupposed the existence of the reservation and presupposed a possessory right subject to lease. The possessory right here did not exist because the Oneida Indian nation had no rights with respect to the land at all in 1997. Those rights could not be enforced. The right not to be--
David H. Souter: It couldn't be enforced against certain innocent purchases but when the land is reacquired, then it seems to me we have to ask whether there was an extinction of aboriginal title and whether the reservation was at some point subsequently disestablished by federal act. If we hold against you on the ground that there was no extinction of aboriginal title and there was no disestablishment of the reservation, then it seems to me that when they reacquire, we get to exactly the point that Justice Breyer raised and that is, once they reacquire the land, why does it become taxable? Why does its nontaxable status not simply reassert itself?
Ira S. Sacks: --I think that you have to look at the definition of Indian country. If you look at the definition of Indian country, it requires, with respect to the properties we're talking about, federal set asides and federal superintendents.
David H. Souter: So you're saying if the original establishment of the reservation was simply a continuation, was literally a reservation from a transfer of land to the state of New York and that the Indian title was a purely aboriginal title, not a title conferred by a federal act creating reservations but it cannot be Indian country, is that correct?
Ira S. Sacks: If I understand the question that you asked, Your Honor, if the title came from the state of New York, for example--
David H. Souter: Let's assume the title is aboriginal. Nothing in an act of the United States says we're giving you this land to the Indians, e.g., in the Kansas situation. It's simply aboriginal title and it was never extinguished. Are you saying that if that is the source of the title as opposed to a federal act saying we give this to you, that it cannot be Indian country?
Ira S. Sacks: --No, Your Honor. In a situation where there was continuing aboriginal title, similar to the Senecas in the state of New York where New York did not terminate the aboriginal rights of the Senecas, there need not be congressional act, there need not be congressional or treaty action to establish the reservation.
David H. Souter: So this part of your argument depends on our accepting your position of the treaty of Fort Schuyler as being a conveyance of all property and a later retrocession, is that correct? Because otherwise, I don't see what extinguished the aboriginal title.
Ira S. Sacks: What extinguished the aboriginal title with respect to this aspect of the argument, and then I will move on to the treaty of Fort Schuyler and the treaty of Canandaigua. What extinguished the aboriginal title is the passage of time, the fact that this land has been under state and local jurisdiction for 190 years and this Court observed, in Hagen and Rosebud Sioux, I acknowledge it was in a different context but this is important, that state and local jurisdiction sovereignty are important in situations like this where what we're dealing with is very few... 1 percent of the land in the City of Sherrill is owned by the tribe. The land is predominantly non Indian. And as this Court observed in Hagen and Rosebud Sioux, a finding of the land now comes back into tribal jurisdiction, to paraphrase, seriously disrupts the justifiable expectations of the community and that's not just a hypothetical in this case.
Stephen G. Breyer: I know that but I mean it seems to me one thing that Oneida establishes is that the whole title doesn't just disappear if nothing else happens simply because of the passage of time.
Ira S. Sacks: I think what this appears, Your Honor, is the right to possess.
Stephen G. Breyer: And we agree with that or I hypothetically agree with that. They can't come in and eject people. But then I'm back to my first question because I take it that the refusal in Oneida to the suggestion that they can't go, say, to Buffalo, New York or wherever or some town and throw everybody out of the house, that that, of course, does reflect the passage of time. But for a city or state to tax the land, that doesn't involve the same kind of interference with people's expectations of living in the houses that they bought, that throwing someone out of his house would involve.
Ira S. Sacks: What impacts the expectations is the following. I'll give you an example that appears from the joint appendix on the Court of Appeals on pages 1263 to 1277. In the year 2000, the city of Oneida decided two Oneida nation businesses, a convenience store and a gas station, for 16 fire code violations. The tribe citing this Court's decision in Brendale said, we're not governed by the local fire code. We're governed by tribal jurisdiction. It's more than just the interference, the issue of taxation, the issue of sovereignty is whether a gas station is going to blow up or burn down.
Sandra Day O'Connor: It is a matter, is it not, of whether the tribe now has sovereignty over this parcel of land, is that's what's at the bottom of the question?
Ira S. Sacks: I think in terms of the problems for the citizens of the City of Sherrill, taxation is part of it, and sovereignty is part of it, they go hand in hand.
Sandra Day O'Connor: If the tribe has sovereignty status with regard to this property, then presumably this city can't tax it. So we have to decide that, do we?
Ira S. Sacks: Yes, you do, Your Honor.
Sandra Day O'Connor: What do we do with the Oneida II case decided in 1985?
Ira S. Sacks: The position we're taking here is fully consistent with Oneida II. In Oneida II, this Court held that there was a violation of federal common law principally because of a violation of the Nonintercourse Indian Trade Intercourse Act in 1795. This Court wasn't asked to deal with, at that time, with the Treaty of Fort Schuyler. It wasn't asked to deal with the treaty of Buffalo Creek. It wasn't presented with evidence of the numerous authorized New York state treatise from 1840 through 1846 that the ministries reservation of the state of New York will deal with--
Antonin Scalia: Why not? I mean, is every decision we make up for review when the interested parties fail to cite what they now assert are the dispositive acts?
Ira S. Sacks: --No, Your Honor. I think that principle of stare decisis still govern and I think why this is consistent with the position that we have taken with respect to the passage of time extinguishing the possessory right is what this Court for stare decisis purposes found in Oneida II was that there was a violation of federal common law with respect to a transfer that was very different than this transfer. Without any examination of the Treaty of Buffalo Creek or without any examination of the Treaty of Fort Schuyler.
Antonin Scalia: But that wouldn't have been a violation of federal law if this were not Indian country, if this were not an Oneida reservation when the transfer occurred.
Ira S. Sacks: Your Honor, that might or might not be correct, depending on how one used the scope of the Nonintercourse Act. But if one views the scope of the Nonintercourse Act to apply to Indian reservations, even state reservations, as the Second Circuit in Mohican Tribe has held, then the treaty of Fort Schuyler could have terminated all aboriginal title. The treaty of Fort Schuyler could have established a state reservation for the Oneidas, and the Nonintercourse Act of 1790, two years later, could have prohibited the sale of those lands even though it was a state reservation and under state jurisdiction.
Antonin Scalia: Is that the application of the Nonintercourse Act? Because I assume it was only the federal act reservation.
Ira S. Sacks: Well, this Court has not dealt with that issue and for our purposes.
Antonin Scalia: How does it read? What does it say? I didn't mean to interrupt you.
Ira S. Sacks: The Nonintercourse Act in effect at the time prohibited the purchase of lands from Indians or Indian tribes, to paraphrase. And what hasn't--
Sandra Day O'Connor: Unless made by treaty or convention entered into pursuant to the constitution.
Ira S. Sacks: --Yes, unless subject to federal approval.
Ruth Bader Ginsburg: And the idea of precisely what's at stake within the Oneida litigation, as I understand it, the counties and the municipalities in the City of Sherrill would not be left in the end having to pay, New York would.
Ira S. Sacks: The City of Sherrill is not a party in the land claim litigation. The land claim litigation--
Ruth Bader Ginsburg: From the county's point of view, I'm asking who pays at the end of the month and it seems, in the Oneida case, it's the state. Is it different here? And what taxes are we talking about precisely?
Ira S. Sacks: --What we are talking about... to answer the first portion of your question, Justice Ginsburg, I think ultimately the citizens of the state of New York would pay but the judgement would be against either the state of New York or the against the counties in the land plat.
Antonin Scalia: What goes with the taxes? You said that the other effect would be that whenever the Oneidas buy a piece of property that is within this former reservation and of which only 1 percent is now owned by Indians, whenever they buy a piece of property, that property is taken off the tax rolls.
Ira S. Sacks: Correct, Your Honor.
Antonin Scalia: Which, of course, makes it a lot easier for them to buy it because it's much less expensive for them to hold that land. What else happens? The town can't regulate it.
Ira S. Sacks: The town can't regulate it and if they are running a business on it, we believe this is contrary to state law, they are running a business out there, they are not collecting sales taxes.
Antonin Scalia: And I assume that also means that that land cannot be repurchased by non Indians?
Ira S. Sacks: The tribe has changed its position on that, I believe, in the course of the last 30 years but that is their current position. That it becomes subject to the Nonintercourse Act consistent with their position. With the Court's permission, I want to turn to the 1788 Treaty of Fort Schuyler and the complementing the 1794 Treaty of Canandiagua. Our position on the treaty of Fort Schuyler I think is very plain in our papers and I just want to highlight what's in the rest of the treaty after Article 1, which is a cessionable land. But in the rest of the treaty is that New York reserved numerous rights even with respect to the reservation's land. New York had, among other things, the right to make and apply laws to the reservation, to enforce the treaty... and I'm quoting from Article 4... in such manner as the state shall deem proper. New York had the right to enforce its criminal laws with respect to intruders on the reservation that New York granted to the Oneidas obtaining the assistance of the Oneidas to do so. New York, in the treaty, prohibited the Oneidas from selling lands. New York, in the treaty, prohibited the Oneidas from certain length of leases and New York had the right to enact laws with respect to the leases that were permitted to enforce the leases. The other thing that one needs to look at in the context of the times, we're looking at how would the Oneidas have understood this. The tribes of the Iroquois Confederacy, knew how to preserve their aboriginal title when they wanted to do so and the Oneidas didn't do that. In the 1797 Big Tree agreement with the Senecas which is published at 7 Statutes at large, 601, the Senecas sold much of their lands throughout the marsh under the approval of the United States. In the agreement, the agreement provided that the reserved lands were, and I quote, clearly and fully understood to remain the property of the Senecas in as full and ample matter as if these presence had not been executed. That is the way an Indian tribe understood preserving aboriginal title. That didn't happen in the Treaty of Fort Schuyler.
Antonin Scalia: You're a good lawyer that they hired and the Oneidas may not have hired as good a lawyer. I don't think this was done around the campfire, do you?
Ira S. Sacks: I'm sure it was not, Your Honor. The other thing that one has to look at at times is what New York state was doing. New York state entered into three similar treatise at the time. One with the Oneidas, one with the Cayuga and one with the Onondaga. Those three treaties all terminated aboriginal title in the first provision. The other three tribes of the were not of concern.
David H. Souter: When you say terminated the title, you mean by the conveyance of all lands?
Ira S. Sacks: Yes, they had the exact same language in Article 1. The structure of the treaties were identical. The other three tribes of the Iroquois were not of concern to New York state in 1788 because the Mohawks had mostly moved to Canada, the Tuscaroras had no land of their own and the Senecas were in the portion of New York state where Massachusetts had the preemption right. So if you look at what is happening back in 1788 and early 1789, New York state is setting up a state treaty with the Oneidas and keeping jurisdiction over those lands. Now, to go back to what you asked earlier, there is no question that if in that context, the Federal Government then passed a statute that says, as it may, the Oneidas can't sell this land without federal approval. That's a violation of the Nonintercourse Act but it doesn't change the fundamental nature of the land as being under state jurisdiction and has been under state jurisdiction since 1788.
Ruth Bader Ginsburg: Was there ever any federal superintendent of the land?
Ira S. Sacks: If you count an agent going on the land, there was an agent going on the land, but what happened with this land in terms of federal superintendents is that this land has been superintended, and supervised whether in tribal hands or otherwise by the state of New York and local governments since 1788. There is a reference in our papers to a report, what was issued in connection with the New York state setting up their troopers to cover the reservations and that reported knowledge that the United States Government appreciated the fact that the state of New York had been keeping peace on the reservations with their police and so no reason to interfere with 100 years... and this was in the 20th century... of over 100 years of state police supervision.
Antonin Scalia: Isn't the FBI that keeps peace on other reservations. Isn't it quite standard for state law enforcement to function?
Ira S. Sacks: Yes, Your Honor. If the FBI doesn't do it, states often do it. They do it sometimes with the permission but this happened for 200 years.
John Paul Stevens: Thank you, Mr. Sacks. Ms. Halligan?
Caitlin J. Halligan: Justice Stevens, may it please the Court: The state of New York was granted time to address the third question regarding the 1838 treaty which we believe requires reversal of the decision below because it disestablish the Oneida reservation. Respondents claim that there is not exercised sovereignty over any part of land they buy within a vast 300,000 tract in Central new York. This has long been inhabited--
Sandra Day O'Connor: Is sovereignty something that the tribes can lose by inaction over a period of time?
Caitlin J. Halligan: --I believe that it is, Your Honor, for the reasons that are laid out in petitioner's brief but regardless of what the Court decides about that question, the Treaty of 1838 clearly disestablishes the reservation which terminates all sovereignty prospectively. The language in the historical context... yes, Your Honor. Yes, the Treaty of Buffalo Creek. It makes clear both the language of the treaty itself as well as its historical context that it was intended to terminate into the sovereignty of New York state.
Sandra Day O'Connor: What you seem to be asking is to infer from that treaty that the prior unlawful land sales of the Oneida's New York reservations were somehow ratified.
Caitlin J. Halligan: No, Your Honor, ratification is not presented squarely in this case. The only question that's at issue in this case is whether or not, regardless of whether the transactions that took place between 1795 and 1838 were legal or illegal, and we've argued they're legal in other cases--
Sandra Day O'Connor: But if you're right about Buffalo Creek, it would mean that the effect of the government's decision to repossess something in Kansas was to leave the Oneidas without any land.
Caitlin J. Halligan: --Well, at that point--
Sandra Day O'Connor: It certainly wasn't that clear from it. It appeared to be the assumption that the Oneidas did not have to go to Kansas, if they chose not to do it. It was dependent on making suitable arrangements.
Caitlin J. Halligan: --With regard to the 5,000 acres that they occupied as of 1838, one could read Ransom Gillet's assurances to the Oneidas as allowing them to continue to retain occupancy over that narrow place of land but what that cannot do is change the language of the treaty which makes clear that the reservation is otherwise entirely disestablished. And if I can refer to some of the language of the treaty itself, first of all, the treaty explicitly states that its purpose was to carry out the governor's policy in removing the Indians from the east to the west of the Mississippi. That simply cannot be squared with ongoing sovereignty over the remaining 290,000 acres which they now claim.
Antonin Scalia: Sure it can. One way to pursue that policy is to offer them lands in the west if they want to go there. That would certainly pursue the government's policy of removing them.
Caitlin J. Halligan: This Court held that Article 13 of the treaty which provides that the Oneidas agreed to remove was sufficient to effect the present grant of the Kansas land and to avoid any forfeiture. So it was much more than an agreement to agree or an offer, if you will.
Antonin Scalia: So you're saying there is no consideration if they simply agree to remove if they want to remove. If they chose to ignore it, they want to ignore it.
Caitlin J. Halligan: No, they did receive consideration and the Court made sure--
Antonin Scalia: They gave none, I'm talking about.
Caitlin J. Halligan: --Who gave none, Your Honor?
Antonin Scalia: The Indians. You're saying they gave no promise in exchange, if they simply promised to remove if they felt like it.
Caitlin J. Halligan: No, Your Honor.
Antonin Scalia: I'm trying to help you here.
Caitlin J. Halligan: Then in that case, I suppose I should agree. My apologies. But what they did was to agree to remove and in fact, that's what happened. If you look at what transpired immediately following the treaty, by 1846, all but 350 acres, down from 5,000, have been sold by the Oneidas and very few remain. By 1920, there are only 32 acres. And the U.S. 's activities in the area also confirm that that was the understanding of the treaty, that it terminated sovereignty. There have been very sparse references in the records to some exercise of jurisdiction by the U.S. starting around the turn of the century, around the early 1900s, but those only relate to the 32 acres that remain occupied by the Oneidas. There is no indication of any exercise of U.S. jurisdiction over the remaining 295,000 acres.
Stephen G. Breyer: I thought that perhaps the Treaty of Buffalo Creek is thinking of 50,000 acres where these particular Indian tribe members have their homes or at least arguably. Just no one was thinking about the remaining 300,000 because they had long left those. It had nothing to do with them.
Caitlin J. Halligan: I believe the text and the historical background suggests otherwise, Your Honor. Article 4 of the treaty says that the Kansas lands will be the new homes of the Oneidas and it also explains where the Oneidas can exercise sovereignty. It says that it will secure to the Oneidas in the Kansas land in said country, which refers to the Kansas land, the right to establish their own form of government, to appoint their own offices and to administer their own laws. That means that sovereignty is to be in Kansas, not to be in New York.
David H. Souter: Well, It means that that's what was intended but what do you make of all of the testimony about the representations made by... I forget the man's name, the government's representative, to the effect you don't have to leave.
Caitlin J. Halligan: That related only to the 5,000 acres that they occupied at that time. But let's make very clear about he made that assurance.
David H. Souter: I guess I just want to get to the point. Doesn't that negate your argument that the treaty as such disestablished the reservation?
Caitlin J. Halligan: No, Your Honor, it doesn't. The treaty on its terms appears to disestablish the reservation entirely. Direct statements could perhaps be read as subsequent blocks on that treaty to assure the Indians that they won't be forced off their land, the 5,000 acres that they continue to occupy, perhaps because New York was not a party to the treaty, it couldn't be any explicit session language in the treaty. New York was the only entity that had the right to buy that remaining 5,000 acres because it held the right of preemption. So it may be that the Oneidas wanted to be sure that they could reach reasonable terms. And they did. They sold all that land within the following six years after consummation of the treaty. So the contemporaneous history squares with that. It's very similar to what happened in Santa Fe in which this Court said there was a reservation that was treated for the Santa Fes. There was some indication of acceptance of that reservation and that acceptance was decision to terminate the tribe's sovereignty over any land outside of the reservation that was provided to them, even though many of them did not in fact remove to that land. Here the Oneidas received much more. Not only did many of them sell the lands and leave immediately but they received the benefit of their bargain by recovering compensation for the Kansas land from this Court and the New York Indians.
Stephen G. Breyer: What is the precise language that you think relinquished changed the sovereignty?
Caitlin J. Halligan: I think there are several provisions, Your Honor. First of all, in the recital, it states that the purpose of the treaty is to carry out the government's policy in removing the Indians from the east to the west of the Mississippi. Article 2 also notes that the Kansas lands will be a permanent home for all Indians now residing in the state of New York as well as elsewhere and Article 4 states that there will be an exercise of sovereignty. It says specifically that will they will be able to establish their own form of government, appoint their officers and administer their laws in the Kansas land specifically. So I think those are the strongest provisions. I would also like to touch for a moment if I can on the question that several members of the Court have raised which is what is the impact of this decision here. From the perspective of the state of New York and the localities, it's very serious because it does concern whether or not the tribe can unilaterally regain sovereignty over a very large tract of land in central New York. This is an area that has been--
Sandra Day O'Connor: There are implications from Oneida to case that the Indians can reacquire land and assert some kind of possessory right.
Caitlin J. Halligan: --With regard to a narrower parcel of land than what's at issue here. And in any event, the Court expressly did not pronounce on the effect of the Buffalo Creek treaty here. If that's the case, what could well result is a patchwork quilt of jurisdiction which this Court has said poses tremendous governance problems. It's governance by tract book. This is not just hypothetical. There are already difficulties that have started to arise as a result of the Second Circuit's decision. For example, another tribe relying on the decision here purchased land within its original land claim area that's just 300 yards from a local high school and have begun operation of a gaming hall there. The locality attempted to enjoin operation of the gaming hall, but wasn't able to do so in light of the Second Circuit's decision below. We anticipate there are will be many other problems of that sort that will arise. The residents of the area here have long settled justifiable expectations. The settlement patterns are clear here. The absence of any exercise of U.S. jurisdiction outside a very small plot of land is not controverted. These are factors that this Court has repeatedly held in cases like Hagen and Yankton Sioux are relevant to the question of both what the contemporaneous understanding of the treaty was and what the result should be today and we submit that they should lead to the same result here as well. If there are no further questions--
John Paul Stevens: Thank you, Ms. Halligan. Mr. Smith, we'll hear from you, please.
Michael R. Smith: Justice Stevens, may it please the Court: There was a suggestion in answer to an earlier question that the Oneidas have changed their position about whether the land is alienable when in their hands. That's not correct. There is nothing in the record to suggest that. What the record does suggest at page 213 of the joint appendix is that Sherrill has changed its position. It wand an easement on Oneida land in 1997 and at that page of the appendix, you will see that Sherrill went to the Department of the Interior for federal approval of the easement under federal law, understanding at the time the Oneida's position and the federal law principle that the land wasn't subject even to an easement absent the secretary's approval.
Antonin Scalia: So you're saying your position was and is that it's not inalienable without the approval of Defense?
Michael R. Smith: Yes. And Oneida's actual possession of the land, actual possession is unified with their underlying federal and property and treaty rights, the land is inalienable and cannot be sold today out of the Oneida's position any more than it could 200 years ago.
Antonin Scalia: But the portion within the reservation you claim is alienable so long as it's not owned by an Oneida. Current owners can sell it to somebody else, right?
Michael R. Smith: Your Honor, the point of Oneida II... the answer is yes.
John Paul Stevens: Like it was strange?
Michael R. Smith: No, Your Honor. There is an unusual twist to it. It arises from the fact that there were illegal transfers 200 years ago. There was a suggestion in the Oneida II decision and it has been followed by the lower federal courts that there may be equitable principles that constrain remedies and a course of order to be entered in a land claim action brought by a tribe that is out of possession but the equitable principles that are at stake here are very different and they don't involve the same--
Sandra Day O'Connor: Well, if you prevail in this case, then could suits be brought by the tribe to evict current owners of land on this historical Oneida 300,000-acre reservation?
Michael R. Smith: --No, Justice O'Connor. The Courts have ruled that we may not do that and it is the position and I will state it clearly here today that the Oneidas do not assert a right to evict landowners in the land claim area.
Sandra Day O'Connor: But if it's owned by the state of New York, if it's been acquired somehow by the state, then what?
Michael R. Smith: We are not asserting a right to evict. We are not waiving any of the underlying rights that involve right to possession under federal law and aboriginal rights and the point I'm making should not be construed that way. What I'm saying is that we are not asking the Court and do not expect the Court to evict anyone from land that is not in our actual possession.
Stephen G. Breyer: What happens about... suppose... I just want to follow this. Suppose you don't evict the people who are there but it's 22 square miles in the center of New York state. That's a lot of land. And maybe that's worth a trillion dollars, I don't know. So does that mean that the Indian tribe would have... would it mean that it would have the right to, let's say, hundreds of billions of dollars, the value of that property and it could sue someone for it, the state of New York or the Federal Government? I guess the state of New York?
Michael R. Smith: Let me give you a concrete answer. The key to the land claim is approximately one quarter of the Oneida land claim and it has gone to judgement and is on appeal in the Second Circuit. The judgement in that case after justice and interest and so on was $250 million and it was rendered against the state of New York only as the initial and--
Stephen G. Breyer: What was the acreage there?
Michael R. Smith: --Approximately one fourth... the answer is 64,000 acres.
Stephen G. Breyer: That may not be worth as much. Maybe this includes several cities and towns? What do you think it is? In other words, the answer to my question is in principle, yes. In principle, if the Indian tribes own 22 square miles, even if they can't get possession, they're entitled to the value of it, in your opinion?
Michael R. Smith: Correct. The point of Oneida II is that it damages remedy as appropriate to a tribe out of possession but there is no suggestion that that is a judicial sale of the underlying Federal Governmently protected--
Stephen G. Breyer: No, no, of course the people who are there have it, maybe it's not Buffalo. I don't know, maybe it's all of Buffalo, New York, or maybe it's a town. I'm not saying that that's the law but I just wanted your view of that. And then I wanted to know this. On the legal part, I would like your response to the... I take it your answer is yes, they're entitled to the value of it, which I'm right about that, that is your answer?
Michael R. Smith: Yes, Your Honor. Well, they're entitled to two items of value. They're entitled to retrospective damages for trespass and in that the Court has not--
Sandra Day O'Connor: On the whole 300,000?
Michael R. Smith: --Well, there is one plus part of it that we have not sued upon because there was a 1798 federal treaty that validated the transfer. The state, which feels that it was not bound by the Nonintercourse Act, twice went to the Federal Government for formal federal treaty approval of these transactions. One of them went through. That was 1798. The other one was 1802. The President did not proclaim it and the state never went back to the Federal Government.
David H. Souter: Do the Oneidas have a claim to tax the current property owners?
Michael R. Smith: No, sir.
David H. Souter: Why not?
Michael R. Smith: The decisions of the Court in cases like Atkinson and Montana address the lack of power of a tribe with respect to non Indian freelance within a reservation. I recognize that there is an added wrinkle here in that the Oneida's rights persist in that land, even though it is out of their possession and that wouldn't have been true in Atkinson, Montana but in that the Courts have held that the possession of the non Indians as lawful in the sense that it will not be interrupted and the land title can be passed in subsequent transfers, we accept the proposition that Montana and Atkinson would prevent the Oneidas from regulating in any respect, let alone tax any of the land in the possession of non Indians.
Antonin Scalia: Mr. Smith, isn't there any principal of laches that comes into effect here. I mean, what you're asking the Court to do is to sanction a very odd checkerboard system of jurisdiction in the middle of New York state. Some parcels are the ones the Indians choose to buy and are able to buy are called Indian territory and everything else is governed by New York state, isn't it? It's just a terrible situation as far as governance is concerned and part of the blame for the situation we're in is that the Oneidas did not claim about this for 170 years.
Michael R. Smith: The issues of laches in time is not within the questions presented in this case, notwithstanding that it has been identified in earlier decisions and was actually raised by the counties in this Court in the last go around. Laches does not bar this claim. These were illegal transactions declared by federal statute to be of no validity in law or equity. The Oneida II decision which holds the background principles of federal law which would ordinarily incorporate state statutes of limitation don't apply because their intention was the underlying rule that only Congress can impair or extinguish this right.
Antonin Scalia: The case also held that because of the passage of time and the reliance interest that has developed, we are not going to give you possession. Now, why doesn't the same principle apply to giving you jurisdiction? Because of the passage of time, you can get damages for trespass. Maybe even you can even get the value of the land. It would just create a chaotic situation if we say that you have jurisdiction in the middle of New York state over any pieces of land that you can buy.
Michael R. Smith: The equitable principles that would inform remedy in an action brought by a tribe out of possession don't apply when a tribe is in possession or else there has been a judicial extinguishment of an underlying right that's only within the power of Congress to extinguish. The Court has been clear that the treaty right here... we have a federal treaty and it says you have the free use and enjoyment of the land in the New York Indians won the Court said that means the same promise made to the Senecas means that the land cannot be taxed. The argument has been made that the Oneida's only rights are to be paid off now, to be in effect have the un extinguished federal aboriginal right and the un extinguished treaty right purchased. Those rights... literally 200 years of decisions... are within the sole control of Congress. Oneida II made pains to say that this was an unusual situation of thoughtless intention and problems but those problems were for Congress. There are a dozen cases from this Court that deal--
Ruth Bader Ginsburg: Mr. Smith, at first, would you clarify how much land is now claimed as Indian... within the tribe's aboriginal right? It's not... one thing clarify while you are not claiming the entire 6 million. Didn't they have 6 million acres to start with?
Michael R. Smith: --They did. The matter was litigated in the Second Circuit and resolved adversely to the Oneidas, but I would take the position that the treaty of Canandaigua actually confirms the transfer of land outside of the retained reservation so that the land that we are talking about today as retaining the Oneida's rights I think is approximately 270,000 acres.
Ruth Bader Ginsburg: Some of that you said was taken up by an approved transfer in 1798?
Michael R. Smith: Yes, and that's why I'm not saying 300,000 acres. I can't do the arithmetic and I don't have the final survey--
Ruth Bader Ginsburg: But something around 275?
Michael R. Smith: --Around 270.
Ruth Bader Ginsburg: And the figure, the 250 million is for the rental... what is that... what is that for?
Michael R. Smith: In the Cayuga case, there were two elements of damages. One was retrospective, and that was rental damages for past trespass. The other was a current value, because Judge McKern said that he would not evict anyone, and that he thought a suitable alternative to eviction was the award of value, because it would put the tribe in a position to a free market and voluntary relationship with the purchasers to, quote, "restore its homeland". Judge McKern got really to the heart of this process by recognizing that there are inequities all around, if you will, and that the Court is without the power to extinguish the underlying rights. It's Congress' role, but that there needs to be a sensible way of recognizing those rights today. And what Judge McKern decided is that damages would put the tribe in a position to do what the Oneidas have done with respect to the land that's at issue here before the Court, and that's to make, you know, a fair and square deal and pay full value.
Ruth Bader Ginsburg: Which New York State paid, and that's the end of it.
Michael R. Smith: Yes, Your Honor. If I understand your question, the answer is yes.
Antonin Scalia: Wall, that's not the end of it. From what you're saying, I gather that you believe, in that case, once they purchase the land, it becomes tribal.
Michael R. Smith: Correct. I mean that's the end of that litigation. There is a judgement, it's gone to the Court of Appeals, and it's there now. The issue of damages remedies when the tribe is out of possession is simply conceptually and fundamentally different than the question of what happens when the tribe has joined possession--
Stephen G. Breyer: What do you say are the merits, then, to the claim that there were 300,000 of these acres in 1838 or with the Treaty of Buffalo Creek... there were 300,000 acres that nobody was paying any attention to because there were no tribe members that lived there, so that when you have language in the treaty, under those circumstances, that says their home is now... where was it? Illinois or--
Sandra Day O'Connor: Kansas.
Stephen G. Breyer: --Kansas. Their home is now Kansas. That's the nation. That's the place. And that... you've heard the language cited. And even though a person says, "You can live here as long as you want. " that just means they can live there as long as they want; that doesn't mean it's the reservation. The reservation's sovereignty may have gone to Kansas, though, of course, nobody had to move, unless he struck a fair bargain that he agreed to with the State of New York. I take it that's their argument. I just want to hear your response.
Michael R. Smith: --There are a lot of parts to that. Let me respond to what I think is the most fundamental.
Stephen G. Breyer: Yeah.
Michael R. Smith: That argument rests on the idea that there was an assumption, at the time of the Treaty of Buffalo Creek, that the prior transfers were valid. It's an argument of ratification by assumption. Oneida II says, in a much more forceful circumstance, that even a later federal treaty that explicitly refers to the prior session does not ratify it, because the ratifying language has to be clear and express, and you have to believe that both the Indians and the Congress, the United States, meant to do that. Here, the... if you think about it, in what I just heard concerning Buffalo Creek, there's an interesting asymmetry. We're supposed to assume that the treaty covered all the land, but we're not supposed to conclude that Ransom Gillet's promise is covered it all. We're supposed to believe that one, by assumption, extends to the entire reservation and that the other, forceful promises of a federal treaty commissioner that you need not go anywhere, are actually very limited and carried with them a thought that they were extinguishing rights in other land. That interaction with Ransom Gillet is crucial. The treaty--
Anthony M. Kennedy: Would not it be odd to have a... to give assurance that you could buy back what you've lost? Does it... would that... that's a very strange construction of the representations intendant upon Buffalo Creek. I understand what you're talking about with the 5,000 acres--
Michael R. Smith: --The representations from the federal treaty commissioner were not that they could buy it back. The federal treaty commissioner went to the Oneidas because they would not agree to the treaty. They didn't want to give up their rights. He gave them a piece of paper that was meant to assure them they were not giving up their rights. There was no suggestion in this important interaction that they were bargaining over the loss of other rights. Mille Lacs is directly in point here. Mille Lacs, I think... well, from Mille Lacs, you can derive the proposition that where the record shows no bargaining over a right, and where the treaty does not refer to the right, the Indians will not be held to have silently yielded their important rights. In the nature of this interaction, you have the suggestion that... you have a far more important right, in a much larger part of the reservation, that persisted as a matter of federal law. There is nothing about what happened at Buffalo Creek that would suggest that anyone would think they were affecting the Oneida's rights in lands that were not involved in the treaty. Now, the treaty--
Antonin Scalia: Mr. Steward, your time is beginning to come up, and there is one thing we haven't talked about that I'd really like to get your view on, and that is the 1788 Treaty... what was that, Fort Schuyler... Treaty of Fort Schuyler?
Michael R. Smith: --Yes.
Antonin Scalia: --between New York State and the Oneidas. Now, that contained language which said the Oneidas cede and grant all their lands to the people of the state of New York. That was the operative provision. Later on, it... Article 2 says, "Of the ceded lands"... the ceded lands, lands that have been ceded... "a tract described by metes and bounds is reserved to the Oneidas to hold to themselves in their posterity forever. " Now, I would normally interpret that too mean that the Oneidas gave up all of their sovereignty over the lands and were given back, by the State of New York, the right over this tract designated by metes and bounds. Now, I'm saying I would normally interpret that, except in a treaty with the Indians. In a treaty with the Indians, you say, "Well"... and we have cases which have language somewhat like this, and they say, "Well, they really didn't cede the part that they reserved. " That may be the case in... ordinarily. But it seems to me, a basic principle of contract law... of treaty law, of any law... that where there is an ambiguous phrase or provision, you interpret it the way the parties themselves have interpreted it. And it seems to me that the subsequent history, after 1788, indicates that the Oneidas believed that New York State had jurisdiction over that land.
Michael R. Smith: Actually--
Antonin Scalia: The New York State Police were in there. New York State managed the lands.
Michael R. Smith: --Justice Scalia, actually, it's interesting, in the Joint Appendix in the Court of Appeals, at page 413, is the actual document that governed the transfer of this land, the state statute; and in that statute, the state granted its right of preemption to an individual to acquire the land, because it understood that it had not yet exercised its right of preemption. That's, in the conduct of the parties, a direct refutation of the idea that the right of preemption was exercised in the Treaty of Buffalo... in the Treaty of Fort Schuyler, the 1788 treaty. The most fundamental point, though, about the 1788 treaty is that next came the 1794 Treaty of Canandaigua, which embodied a federal promise to protect the free use and enjoyment of this land, and the Oneidas possession of it. And that exact promise... not sort of like, but exact... was held in New York to prevent taxation of the Senecas land. I guess I'd like to make two quick points before I'm out of time. One is that, with respect to the idea that it's just too late, apart from the fact that the question is not presented, I want to emphasize that, in section 2415 of Title 28, Congress explicitly focused on the question of these old claims. And if you read the legislative history, all they talked about was how to deal with the Oneida claim and these old claims. And they not only provided that title claims are not barred by statute of limitations, and established the limitations period that would not have run against the Oneidas because they were on a federal list, but they did the following, which I think is notable. The statute provides that these claims approved, in 1966, on the day of the statute, there is no room for background equitable principles in federal law. Where Congress has specifically focused on a problem addressed it, the idea is, I suppose, that there is no room to fill gaps here by the Court when Congress has decided just what the gaps are and how to fill them. The other point that I would make concerns the Treaty of Buffalo Creek. The treaty's language leaves it to both sides to decide whether or not Indians are going to Kansas. The legislate... the history of the treaty shows that the United States backed away from any language which would oblige it to remove Indians, and the language with respect to the Indians left them a choice. But, ultimately, all of that is controlled by what happened. The Federal Government made a decision that no Indians would go to Kansas. The idea that Buffalo Creek extinguished reservations in New York would seem bizarre to anyone in New York today, because the Onondagas have reservations, the Senecas have reservations, the St. Regis have reservations, the Tonawandas have reservations, the Tuscaroras have reservations, and the Oneidas have reservations. It didn't extinguish just the... there's the idea that you can look at this in a vacuum... it didn't just extinguish the Oneida reservations. Under the Santa Fe rationale, the point is not that Congress ultimately intended two reservations, although it has done that often... the Choctaw, the Mississippi Choctaw, the Seminoles. It frequently happened with removal if there were more than one reservation. But here, you would have to believe that Congress intended no reservations. You would have to believe that Congress quickly came to the decision that none of these Indian tribes in New York actually had a reservation anywhere, and that's not acceptable. Thank you.
John Paul Stevens: Thank you, Mr. Smith. Mr. Stewart?
Malcolm L. Stewart: Justice Stevens, and may it please the Court: I would like to address, first, the City's argument that the long passage of time renders it improper to give the tribe a tax exemption on lands that have... recently were purchased. That argument is wrong for three reasons. First, if we are correct that the tribe had federally protected title as of the 1790s and that that federal protection was never validly extinguished, then the fact that the tribe was out of possession of the relevant lands for nearly two centuries is, itself, a distinct and substantial legal wrong, and it would be adding insult to injury to say that precisely because the tribe had suffered that initial injury, it should be disentitled to take advantage of a tax exemption that would otherwise flow from its possession of--
Antonin Scalia: I don't... I don't understand that argument at all. I mean, it's just a general rule that, where you've been wrong, you have to come forward, in a timely fashion, to get the wrong righted. And what difference does it make what the nature of the wrong is, whether it's dispossession or not?
Malcolm L. Stewart: --Well, I think it... I think it's important to distinguish between two different types of delay. What was at issue in Oneida I and II was delay in bringing the underlying lawsuit. And, even in that context, the Court said that the suit was not barred entirely, but equitable factors might be taken into account in formulating an appropriate remedy. Here, we don't have delay in filing a lawsuit. That is, nobody doubts that the tribes asserted their right to a tax exemption promptly after repurchasing the relevant land. The argument on the other side is that their delay in purchasing the land should be analogized to--
Sandra Day O'Connor: Well, do you say that a tribe can never lose its sovereign rights to land? Can it acquiesce in the loss of those rights?
Malcolm L. Stewart: --This Court has held that the tribe... that a tribe may abandon aboriginal title to land.
Sandra Day O'Connor: Yes.
Malcolm L. Stewart: It's not--
Sandra Day O'Connor: Yes, and we have held that a state can abandon sovereignty, as in Massachusetts versus New York.
Malcolm L. Stewart: --But the Court has also held that once Congress creates a reservation, once it confers explicit federal protection on particular lands, the reservation can be diminished or disestablished only by act of Congress; it can't be terminated through adverse possession. And with respect to the question of whether delay in buying the land should be analogized to delay in bringing a--
Sandra Day O'Connor: Well, that might give them a right to some kind of damages for a violation, but what does that do to the sovereign claims of the tribe?
Malcolm L. Stewart: --I think the... the reservation would remain a reservation. As Mr. Smith pointed out, with respect to parcels within the reservation that are not owned by Indians, the tribe's regulatory authority is extremely limited and, therefore, the tribe would not be able to exercise anything like plenary regulatory jurisdiction over the whole 270,000 acres.
Ruth Bader Ginsburg: What is it? You said "extremely limited". This is the first I heard that the tribe might have some authority over part of that, what, the 275... 275,000 acres, even though it hadn't repurchased the costs.
Malcolm L. Stewart: The Court, in Atkinson Trading, and in Montana versus United States, before that, that said that the tribe may be able to regulate conduct on non Indian lands to the extent that the conduct involves voluntary transactions with the tribe or its members or to the extent that the regulation is necessary in order to protect the tribe's sovereignty over the land that it possesses is--
Ruth Bader Ginsburg: But now we're talking about land that... where there are no tribe members... as I understand it, this area is predominantly non tribal members.
Malcolm L. Stewart: --I agree. In... and Atkinson Trading makes clear that, even when the great bulk of the land is only by the tribe or its members, the tribe's ability to regulate conduct on the non Indian parcels is sharply limited. That would be doubly true in a tract of this nature. But to return to the point about the state's reliance interest, I think it's... or the city's reliance interest... I think it's important to stress that this case is only about taxation, and a municipality can't claim to have the same sort of reliance interest in being able to tax that a potential defendant--
Stephen G. Breyer: Well, that may be true, but that's why I wondered about the damage part of it. I'm still thinking that a trespass action for trespasses that occurred in 1850 or 1700 is worth millions today, even if it's tiny, because of the interest, passage of time, et cetera. When you add that to the value of the land, I'm thinking of numbers that are astronomical. And yet that hasn't happened. And so, what actually, as a... and that's why I'm thinking, isn't a damage action far more serious than simply taking property off the tax rolls?
Malcolm L. Stewart: --That's true, but--
Stephen G. Breyer: And that's why I want to know how, in practice, this works out. Does Congress have the power, for example, to deal with it? Is what we're considering in this case simply a negotiating position and strengthening people's hands, vis a vis legislation? What's going on?
Malcolm L. Stewart: --Congress does have the power to deal with it. And at the end of the Court's opinion in Oneida II, the Court expressed confidence that, up to this point, has not been borne out, that Congress would fix the problem.
Sandra Day O'Connor: Yes, Congress has done nothing about this, has it? Can... has the tribe asked, administratively, for the Bureau of Indians Affairs to recognize it now as a tribe?
Malcolm L. Stewart: Well, the Bureau of Indian Affairs has recognized the tripe all along. That is, under the Treaty of Canandaigua, the Federal Government was required to pay annuities and treaty cloth to the six nations, and the Federal Government has done that continuously since the beginning. So we've always recognized this to be a tribe. And I think you're... you've put your finger on an important point, Justice Breyer, in that the Court, in Oneida II, said that it hoped that Congress would fix the problem, and thought that it would, but said that even if Congress doesn't legislate a solution, the suit can go forward. The Court contemplated that equitable considerations could be taken into account in formulating a remedy, but it certainly didn't contemplate that the tribe, at the end of the day, would be left without any remedy at all. And, as you point out, if the tribe can sue for damages, it seems farfetched to think that it wouldn't be able to reassert the tax immunity that--
Ruth Bader Ginsburg: What tax... what taxes are we talking about? Is this property tax? Are we also talking about sales tax?
Malcolm L. Stewart: --No, the Court has said... the Court has said, as a general matter, as a matter of federal law, a tribal merchant on tribal land can be required to collect sales taxes from non Indians, at least for the purchase of goods that were purchased off the reservations.
Antonin Scalia: Well, it isn't just taxes we're talking about. It's jurisdiction over these parcels of land. It... I mean, taxes... that's just one aspect of saying that this land no longer belongs to New York State.
Malcolm L. Stewart: I mean, taxes are the only thing at issue... are the only thing that's at issue in this case. But I agree that holding this parcel to be a reservation would have implications for regulatory jurisdiction, as well. Now, there isn't a categorical rule of federal law that says that states and localities absolutely cannot regulate conduct on tribal lands within the reservation. Rather, there is a preemption test... there's certainly a thumb on the scale in favor of an exemption from state and local regulation where tribal reservation lands are involved.
Anthony M. Kennedy: Mr. Stuart, I have one question about, Buffalo Creek. If we hold that Buffalo Creek didn't disestablish the reservation, then doesn't the New York Indian case rest on a false premise because that case gave $2 million for failure to give the Kansas lands?
Malcolm L. Stewart: Well, the Court, in the New York Indians II, recognized, to start with, that the treaty affected an immediate session of the Oneida's Wisconsin lands to the Federal Government, and the Court specifically noted that that session, in and of itself, would be sufficient consideration to support a contract between private parties. So it simply isn't correct to say that the New York Oneidas gave up something other than a promise to remove. The second--
David H. Souter: Was there any positive indication... I just don't remember this... in the New York case, that they would... that they, in fact, had ceded anything of New... of their interest in New York? As distinct from the Wisconsin land.
Malcolm L. Stewart: --I mean, there were references to the primary inducement to the Federal Government's entering into the treaty being the desire for--
David H. Souter: That's entering into the treaty. But when it came to compensation, was there an indication that they were being compensated for anything other than Kansas land, which they had obtained as a result of ceding their Wisconsin land?
Malcolm L. Stewart: --No. No.
David H. Souter: Okay.
Malcolm L. Stewart: The compensation was strictly for the Kansas lands that were denied to them. And it's important to note that the Senecas--
David H. Souter: But there was no indication that they got Kansas for anything other than Wisconsin, is that correct?
Malcolm L. Stewart: --They got... I mean, they didn't... they weren't held to have promised... made a commitment to remove from New York. No, clearly, in analyzing the reasons--
David H. Souter: But there was no indication that they had ceded anything with respect to title in New York, was there?
Malcolm L. Stewart: --That's correct.
David H. Souter: Okay,--
Antonin Scalia: Well, it rested upon the session in Wisconsin?
Malcolm L. Stewart: It rested, in part, upon the session in Wisconsin. It rested, in part, on a fairly technical argument, to the effect that the grant of Kansas lands was on en presente. That is, it was a present grant of Kansas lands, and, therefore, the New York Indians could be disentitled to those lands only if they had... a forfeiture had been established. And the Court looked to Article 3 of the treaty to determine the conditions for forfeiture. It said that the Federal Government would have been required to allege a forfeiture by legislative or judicial act, et cetera. The other thing I really wanted to... the point I wanted to make about the reliance interest of the taxing jurisdiction are that no matter how long a particular tract has been taxable, it is... may I finish this +/? it is always within the realm of a city's contemplation that it may be bought up tomorrow by the Federal Government, a church, any other tax exempt entity, and, consequently, the municipality can have no sense of repose that it will remain taxable. Thank you.
John Paul Stevens: Thank you, Mr. Stewart. The case is submitted.