Opinion ID: 677451
Heading Depth: 1
Heading Rank: 2

Heading: The Contractual Defense

Text: 10 Rose claims that the entry of summary judgment against him on liability was error because the district court concluded that the Management Agreement and Joint Venture Agreement provide Rose with no defense against the operation of the ordinance. He claims that the rights of Justus to conduct the games under the Management Agreement were assigned to Miller by the Joint Venture Agreement, making the games conducted by Miller and Rose authorized under the ordinance. This court reviews de novo the application of the principles of contract interpretation to the facts. Aetna Casualty and Surety Co. v. Pintlar Corp., 948 F.2d 1507, 1511 (9th Cir.1991). The interpretation of a statute is a question of law reviewed de novo. E.g., Mt. Graham Red Squirrel v. Espy, 986 F.2d 1568, 1571 (9th Cir.1993). 11 Section 81 of 25 U.S.C. declares that certain contracts with a tribe of Indians or individual Indians are null and void unless approved by the Secretary of the Interior and the Commissioner of Indian Affairs. 1 The district court concluded that the lack of approval of the Management Agreement and Joint Venture Agreement rendered them void and no basis for a defense against liability. Rose argues that the contracts did not require approval for two reasons. First, the contracts authorizing the bingo games were allegedly between the Band and Miller, an Indian, because Justus had assigned its rights to Miller. Rose argues that section 81 is intended to guard against unconscionable or exploitative contracts between Indians or tribes and non-Indians. Second, Rose claims that the contracts were not relative to [Indian] lands because the facility was to be located on Miller's allotted trust land, and because the Management Agreement did not give Justus the exclusive right to operate bingo on the reservation. 12 We find no merit in Rose's contentions. The contract authorizing the games, the Management Agreement, was clearly between the band and a non-Indian, Justus. Failure to get BIA approval made the contract a nullity from the outset. To find that the fact that Miller was a member of the Band made any difference, one would have to conclude that the purported assignment worked a novation of an otherwise void contract. Even if that were possible, there was no assignment because there was no approval thereto as required by 25 U.S.C. Sec. 84. Miller and Rose, therefore, did not accede to the benefits of the Management Agreement. 13 Rose also fails to establish that the contract was not relative to [Indian] lands. This court and the Seventh Circuit have held that section 81 controls contracts involving bingo facilities located on tribal trust lands. A.K. Management Co. v. San Manuel Band of Mission Indians, 789 F.2d 785, 787 (9th Cir.1986) (The broad language of section 81 expresses congressional intent to cover almost all Indian land transactions.); Wisconsin Winnebago Bus. Comm. v. Koberstein, 762 F.2d 613, 619 (7th Cir.1985). Barona Group of Capitan Grande Band of Mission Indians v. American Management & Amusement, Inc., 840 F.2d 1394 (9th Cir.1987), cert. dismissed, 487 U.S. 1247, 109 S.Ct. 7, 101 L.Ed.2d 958 (1988), cited by Appellant, does not support Appellant's claim that courts have found section 81 controlling only where unallotted tribal trust lands are involved. In fact, the Barona court held that section 81 controlled where the lands were on the reservation, even though the lands involved apparently were not trust lands. Id. at 1398 (quoting BIA, which did not believe approval was required because trust lands and funds are not involved). Moreover, that case held that a bingo management agreement was relative to Indian lands because it granted the exclusive right to operate bingo games. Id. at 1403-04. The Management Agreement in this case granted Justus the exclusive right to operate for-profit bingo games on the reservation. The district court did not err by holding that BIA approval was required. 14 We find no error in the district court's conclusion that the contracts between the Band, Justus, and Miller provide Rose with no defense against the enforcement of the bingo ordinance.