Court Opinion

ID: 8885437
Source: CourtListenerOpinion
Date Created: 2022-11-26 21:43:14.260928+00
Date Added: 2024-06-11T17:06:53.404009
License: Public Domain

ELY, Circuit Judge
(dissenting):
I respectfully dissent. The obligation of the federal government to its Indian wards, probably born of a collective na*1188tional guilt, runs deep. It is federal policy, undeniable, if belated, that the Indian has a special status in our Country and that he is justly entitled to very special protection. I cannot join in stripping such a protection from the Agua Caliente Band in the face of the overwhelming evidence that the tax in question amounts, in its effect, to taxation of the full value of Indian trust lands.
It is conceded by all concerned that were Riverside County’s possessory interest tax imposed directly on the Indian lands, it would be unlawful. My Brothers, however, feel constrained by United States v. Detroit, 355 U.S. 466, 78 S.Ct. 474, 2 L.Ed.2d 424 (1958), to hold that “the tax imposed upon the use of property is something distinct from a tax imposed upon the property itself.” They conclude the tax to have been validly imposed absent legislative immunization. They further rely upon Oklahoma Tax Comm’n v. Texas Co., 336 U.S. 342, 69 S.Ct. 561, 93 L.Ed. 721 (1949), to conclude that no such legislative immunization may be implied. I strongly disagree with both conclusions.
Detroit simply expressed the view, with which I have no disagreement, that the doctrine of intergovernmental immunity does not preclude state taxation of an entity solely because the burden of such taxation eventually falls on the federal government. If, however, an important federal policy conflicts with the goal of effective implementation of the state taxing power, I should think that the Supremacy Clause demands that the extent to which a state tax burdens the federal policy be an important factor in determining the validity of the tax. There was no such conflict in Detroit. Here, I submit, the conflict is unmistakable, and the burden onerous.
Moreover, even if the majority has correctly interpreted Detroit, the local tax here involved was illegal. The Agua Caliente lands were given “for the sole use and benefit” of the Band, to be conveyed at the end of the trust period “free of all charge or encumbrance whatsoever.” The land involved in Oklahoma Tax Comm’n was allotted pursuant to a statute containing the same language, and my Brothers construe the opinion in that case as a refusal to imply a tax exemption from the language. But this, I submit, is an incorrect reading of that case. The court in Oklahoma Tax Comm’n was addressing itself primarily to the constitutional status of lessees of government-owned lands, whether Indian trust or otherwise. The lessees in that case sought exemption as federal instru-mentalities. “The respondents are ‘private persons’ who seek immunity ‘for their property or gains because they are engaged in operations under a government contract or lease.’ ” 336 U.S. at 363, 69 S.Ct. at 572. Since the Indian lessors bore no tax burden, direct or indirect, the lessees were precluded from urging a derivative immunity from the Indian grant. “These eases present no question concerning the immunity of the Indian lands themselves from state taxation. There is no possibility that ultimate liability for the taxes may fall upon the owner of the land.” 336 U.S. at 353, 69 S.Ct. at 567 (emphasis supplied). The statutory implication which was rejected in that case was not urged from the Indian grant, but from the fact of the lease itself. No derivative Indian rights were asserted by the non-Indian lessees, and no Indian was a party to the action. Indeed, the crucial language of the statute was not discussed, or even mentioned!
Underscoring the limited relevance of Oklahoma Tax Comm’n is Squire v. Capoeman, 351 U.S. 1, 76 S.Ct. 611, 100 L.Ed. 883 (1956). There, the Supreme Court, fulfilling a “clear ‘duty to secure to the Indians all that by any fair construction of treaty or statute can be held to have been understood by them or intended by Congress [,] Minnesota v. Hitchcock, 185 U.S. 373, 402, 22 S.Ct. 650, 46 L.Ed. 954 (1902),’ ” actually did construe the “charge or encumbrance” language alleged to have been at issue in Oklahoma Tax Comm’n. Without ref*1189erence to the Oklahoma case, the language was construed to include taxation.
The majority’s footnote 15 gives inadequate expression to the force of Squire. The case did not turn on the difference between state and federal taxation of Indian trust lands. Rather, the case stands for the proposition that the federal policy of protecting Indian wards is superior even to the need to collect revenue for the maintenance of the federal government itself. Surely, we should afford no less protection when the interest of the Indian ward is in conflict with an interest of a State. Some of the States were likely no less responsible than the Nation for alleged depredations of Indian property sometimes said to have caused the creation of federal trust status in the first instance. Cf. Note, 42 S.Cal.L.Rev. 101, 110 n. 42. (1969).
I would reverse.