Court Opinion

ID: 3007134
Source: CourtListenerOpinion
Date Created: 2015-10-05 20:02:31.283501+00
Date Added: 2024-06-11T15:03:24.225924
License: Public Domain

Filed 10/5/15 San Pasqual Band of Mission Indians v. State of California CA2/8
                  NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
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              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                     SECOND APPELLATE DISTRICT

                                                 DIVISION EIGHT

SAN PASQUAL BAND OF MISSION                                          B254870
INDIANS,
                                                                     (Los Angeles County
                            Plaintiff and Appellant,                  Super. Ct. No. BC431469)

                   v.

STATE OF CALIFORNIA et al.,

                   Defendants and Respondents.

         APPEAL from the judgment of the Superior Court of Los Angeles County. Ruth
Ann Kwan, Judge. Affirmed.

         Solomon, Saltsman & Jamieson, Stephen Warren Solomon, Stephen Allen
Jamieson and Ryan Michael Kroll for Plaintiff and Appellant.

         Kamala D. Harris, Attorney General, Sara J. Drake, Assistant Attorney General,
Peter H. Kaufman and Jennifer T. Henderson, Deputy Attorneys General, for Defendants
and Respondents.

                                                 **********
       Plaintiff and appellant San Pasqual Band of Mission Indians (San Pasqual) appeals
from the entry of summary judgment in favor of defendants and respondents State of
California and the California Gambling Control Commission (the State). In September
1999, San Pasqual and the State entered into a written contract (the Compact) governing
San Pasqual’s operation of a casino on its land in San Diego County. San Pasqual
contends the Compact authorized it to operate up to a maximum of 2,000 slot machines at
its casino, but the State wrongfully refused for several years to issue it the requisite
number of gaming licenses, resulting in $315,000,000 of lost profits.
       San Pasqual filed two lawsuits against the State that were consolidated, alleging
breach of contract and seeking damages for five years of lost profits. The State
successfully obtained summary judgment in the consolidated action on the grounds a
provision in the Compact bars monetary damages as a remedy to either party in any
action arising under the Compact. San Pasqual contends the court misinterpreted the
provision, failed to consider admissible extrinsic evidence relevant to a proper
interpretation of the provision, and erroneously resolved disputed factual issues.
       We affirm.
                  FACTUAL AND PROCEDURAL BACKGROUND
       Despite the large volume of materials presented in the appellate record, this appeal
raises a relatively narrow issue; it challenges only the one ground upon which the trial
court granted summary judgment. Bearing in mind the limited scope of this appeal, we
limit our recitation of the evidence and procedural history to that which is relevant to the
issue raised on appeal.
1.     Historical Background and Relevant Federal Law
       To provide context for the parties’ dispute and our discussion, we summarize the
background facts, relevant federal law regarding tribal gaming and prior related litigation.
       In 1988, Congress passed the Indian Gaming Regulatory Act (the Act) (25 U.S.C.
§ 2701 et seq.), in part, to “provide a statutory basis for the operation of gaming by Indian
tribes as a means of promoting tribal economic development, self-sufficiency, and strong
tribal governments.” (§ 2702(1).) The Act divides gaming into three classes. At issue

                                              2
here is Class III gaming which includes slot machines and other electronic gaming
devices. (§ 2703(7)(B) & (8).) In order for an Indian tribe to conduct Class III gaming
on its land, the Act requires a written contract or “tribal compact,” authorizing such
gaming, between that tribe and the state in which its land is located. (§ 2710(d)(1)(C).)
The Act also requires that the state generally “permits such gaming for any purpose by
any person, organization, or entity.” (§ 2710(d)(1)(B).)
       California’s Constitution provides that the “Legislature has no power to authorize,
and shall prohibit casinos of the type currently operating in Nevada and New Jersey.”
(Cal. Const., art. IV, § 19(e).) After the passage of the Act, the State therefore took the
position that it need not negotiate with tribes pursuant to the Act for the right to conduct
Class III gaming, because such gaming was not generally permitted in California within
the meaning of the Act. (Coyote Valley Band of Pomo Indians v. California (9th
Cir. 2003) 331 F.3d 1094, 1097-1099 (Coyote Valley).)
       “A coalition of California tribes drafted and put on the November 1998 State
ballot Proposition 5” authorizing Class III gaming on tribal land. (Coyote Valley, supra,
331 F.3d at pp. 1099-1100.) Proposition 5 passed and was codified at Government Code
sections 98000 through 98012. However, the Supreme Court concluded Proposition 5
was invalid because it conflicted with the constitutional prohibition against gaming in
article IV, section 19, subdivision (e). (Hotel Employees & Restaurant Employees
International Union v. Davis (1999) 21 Cal.4th 585, 615-616.)
       Concerned that several tribes had already put some gaming devices into operation
and would be “vulnerable to federal prosecution” (Coyote Valley, supra, 331 F.3d at
p. 1102), then-Governor Davis began negotiations with California tribes pursuant to the
Act (id. at pp. 1101-1102). The State also proposed a constitutional amendment allowing
for gaming on Indian lands (Proposition 1A). To facilitate the negotiations, California
tribes formed three negotiating teams, including the United Tribe Compact Steering
Committee (the Committee). (Coyote Valley, at p. 1102.) The Committee was composed
of approximately 80 tribes, including San Pasqual. The Committee proposed “the model
compact contained in Proposition 5 [as] its opening offer.” (Ibid.)

                                              3
       In September 1999, after several months of negotiations, the State executed
61 tribal compacts with tribes throughout California, including San Pasqual.
Proposition 1A, the constitutional amendment allowing gaming on tribal lands, passed in
March 2000. (Cal. Const., art. IV, § 19, subd. (f).)
       The 61 tribal compacts were “substantively identical” and “authorized Class III
gaming.” (Cachil Dehe Band of Wintun Indians of the Colusa Indian Community v.
California (9th Cir. 2010) 618 F.3d 1066, 1068 (Colusa II).) The tribal compacts
provided that those tribes that already had gaming devices in operation could continue to
operate those existing devices as a matter of right. For tribes, like San Pasqual, that did
not have gaming devices in operation as of September 1999, the compacts specified they
were entitled to operate up to 350 gaming devices as a matter of right. (Compact
Sec. 4.3.1.) (Colusa II, at p. 1071.) For each additional gaming device a tribe sought to
operate, up to a maximum of 2,000, the tribe had to apply for a license. A separate
license was required for each individual device. (Sec. 4.3.2.2.) Licenses would be
allocated to tribes from a statewide pool of licenses according to a “detailed draw
process.” (Calussa II, at p. 1071.)
       The license draws were initially operated by a third party entity. (Colusa II,
supra, 618 F.3d at p. 1071.) “In 2001, following complaints regarding the accounting
and administration of the draws . . . , [then-Governor] Davis issued an executive order
creating the California Gambling Control Commission” to take over the license draw
process. (Ibid.)
       Shortly thereafter, a dispute arose between the State and the tribes, including
San Pasqual, about the total number of licenses that were available for distribution among
the compact tribes. The tribal compacts did not specify what that number would be, but
instead, set forth a formula, in Section 4.3.2.2. of the Compact, for calculating that

                                              4
number.1 The State “adopted an interpretation [of Section 4.3.2.2.] that authorized a
license pool of 32,151 licenses.” (Colussa II, supra, 618 F.3d at p. 1071.)
       San Pasqual, along with several other tribes, sought declaratory relief in federal
court.2 The tribes agreed that the formula in Section 4.3.2.2. of the Compact set a ceiling
on the total number of licenses available statewide, but contended the State was
unreasonably interpreting the formula to arrive at a low number that deprived tribes of
their full allotment of 2,000 slot machines. (Colusa II, supra, 618 F.3d at p. 1069.) In
Colusa II, the Ninth Circuit determined the total number of licenses that could be issued
statewide through the license draw process was 40,201, providing for an additional
8,050 licenses to be distributed statewide to eligible tribes. (Id. at pp. 1081-1082, 1085.)
       During the time the State maintained its position that only 32,151 licenses were
available in the pool, San Pasqual submitted multiple applications seeking to obtain its
full allotment of licenses. San Pasqual submitted applications in the draws held in
September 2002, July 2003, December 2003, October 2004, October 2005, August 2006,
October 2007 and December 2008. San Pasqual received 72 licenses in the October 2004
draw, but as of 2008, it was still “short” 428 licenses.
       San Pasqual obtained 428 licenses in the October 2009 license draw resulting in its
ability to finally operate 2,000 slot machines at its casino.

1      Section 4.3.2.2.(a)(1) of the Compact provides: “The maximum number of
machines that all Compact Tribes in the aggregate may license pursuant to this Section
shall be a sum equal to 350 multiplied by the number of Non-Compact Tribes as of
September 1, 1999, plus the difference between 350 and the lesser number authorized by
Section 4.3.1.”
2       San Pasqual’s federal court action, filed in the southern district of California, was
titled San Pasqual Band of Mission Indians v. State of California, case No. 06CV0988
LAB (AJB). Following the Ninth Circuit’s decision in Colusa II, the State and San
Pasqual stipulated to dismiss San Pasqual’s declaratory relief action without prejudice on
the grounds the Colusa II decision mooted the action.

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2.     The September 1999 Compact Between San Pasqual and the State
       The Compact between the State and San Pasqual is 39 pages long. San Pasqual’s
chairperson, Allen Lawson, was San Pasqual’s “primary tribal representative” during the
negotiations, and he signed the Compact on behalf of San Pasqual. Then-Governor Davis
executed the Compact on behalf of the State and the Legislature ratified it thereafter.
(Gov. Code, § 12012.25, subd. (a)(40).) The Compact became effective in May 2000,
when the Secretary of the Interior published approval of the executed Compact in the
Federal Register in accordance with the Act. (25 U.S.C. § 2710(d)(8)(A); 65 Fed.Reg.
31189 (May 16, 2000).)
       The parties dispute the meaning and purpose of Section 9.4 of the Compact, a
subdivision of Section 9.0 which covers dispute resolution. Because Section 9.4 must be
read in context, and not in isolation, we set forth the full text of Section 9.0.
       “Sec. 9.0. DISPUTE RESOLUTION PROVISIONS.
       “Sec. 9.1. Voluntary Resolution; Reference to Other Means of Resolution. In
recognition of the government-to-government relationship of the Tribe and the State, the
parties shall make their best efforts to resolve disputes that occur under this Gaming
Compact by good faith negotiations whenever possible. Therefore, without prejudice to
the right of either party to seek injunctive relief against the other when circumstances are
deemed to require immediate relief, the parties hereby establish a threshold requirement
that disputes between the Tribe and the State first be subjected to a process of meeting
and conferring in good faith in order to foster a spirit of cooperation and efficiency in the
administration and monitoring of performance and compliance by each other with the
terms, provisions, and conditions of this Gaming Compact, as follows:
       “(a) Either party shall give the other, as soon as possible after the event giving
rise to the concern, a written notice setting forth, with specificity, the issues to be
resolved.
       “(b) The parties shall meet and confer in a good faith attempt to resolve the
dispute through negotiation not later than 10 days after receipt of the notice, unless both
parties agree in writing to an extension of time.

                                               6
       “(c) If the dispute is not resolved to the satisfaction of the parties within 30
calendar days after the first meeting, then either party may seek to have the dispute
resolved by an arbitrator in accordance with this section, but neither party shall be
required to agree to submit to arbitration.
       “(d) Disagreements that are not otherwise resolved by arbitration or other
mutually acceptable means as provided in Section 9.3 may be resolved in the United
States District Court where the Tribe’s Gaming Facility is located, or is to be located, and
the Ninth Circuit Court of Appeals (or, if those federal courts lack jurisdiction, in any
state court of competent jurisdiction and its related courts of appeal). The disputes to be
submitted to court action include, but are not limited to, claims of breach or violation of
this Compact, or failure to negotiate in good faith as required by the terms of this
Compact. In no event may the Tribe be precluded from pursuing any arbitration or
judicial remedy against the State on the grounds that the Tribe has failed to exhaust its
state administrative remedies. The parties agree that, except in the case of imminent
threat to the public health or safety, reasonable efforts will be made to explore alternate
dispute resolution avenues prior to resort to judicial process.
       “Sec. 9.2. Arbitration Rules. Arbitration shall be conducted in accordance with
the policies and procedures of the Commercial Arbitration Rules of the American
Arbitration Association, and shall be held on the Tribe’s land or, if unreasonably
inconvenient under the circumstances, at such other location as the parties may agree.
Each side shall bear its own costs, attorneys’ fees, and one-half the costs and expenses of
the American Arbitration Association and the arbitrator, unless the arbitrator rules
otherwise. Only one neutral arbitrator may be named, unless the Tribe or the State
objects, in which case a panel of three arbitrators (one of whom is selected by each party)
will be named. The provisions of Section 1283.05 of the California Code of Civil
Procedure shall apply; provided that no discovery authorized by that section may be
conducted without leave of the arbitrator. The decision of the arbitrator shall be in
writing, give reasons for the decision, and shall be binding. Judgment on the award may
be entered in any federal or state court having jurisdiction thereof.

                                              7
       “Sec. 9.3. No Waiver or Preclusion of Other Means of Dispute Resolution. This
Section 9.0 may not be construed to waive, limit, or restrict any remedy that is otherwise
available to either party, nor may this Section be construed to preclude, limit, or restrict
the ability of the parties to pursue, by mutual agreement, any other method of dispute
resolution, including, but not limited to, mediation or utilization of a technical advisor to
the Tribal and State Gaming Agencies; provided that neither party is under any obligation
to agree to such alternative method of dispute resolution.
       “Sec. 9.4. Limited Waiver of Sovereign Immunity. (a) In the event that a dispute
is to be resolved in federal court or a state court of competent jurisdiction as provided in
this Section 9.0, the State and the Tribe expressly consent to be sued therein and waive
any immunity therefrom that they may have provided that: [¶] (1) The dispute is limited
solely to issues arising under this Gaming Compact; [¶] (2) Neither side makes any
claim for monetary damages (that is, only injunctive, specific performance, including
enforcement of a provision of this Compact requiring payment of money to one or
another of the parties, or declaratory relief is sought); and [¶] (3) No person or entity
other than the Tribe and the State is party to the action, unless failure to join a third party
would deprive the court of jurisdiction; provided that nothing herein shall be construed to
constitute a waiver of the sovereign immunity of either the Tribe of the State in respect to
any such third party.
       “(b) In the event of intervention by any additional party into any such action
without the consent of the Tribe and the State, the waivers of either the Tribe or the State
provided for herein may be revoked, unless joinder is required to preserve the court’s
jurisdiction; provided that nothing herein shall be construed to constitute a waiver of the
sovereign immunity of either the Tribe or the State in respect to any such third party.
       “(c) The waivers and consents provided for under the Section 9.0 shall extend to
civil actions authorized by this Compact, including, but not limited to, actions to compel
arbitration, any arbitration proceeding herein, any action to confirm or enforce any
judgment or arbitration award as provided herein, and any appellate proceedings
emanating from a matter in which an immunity waiver has been granted. Except as

                                               8
stated herein or elsewhere in this Compact, no other waivers or consents to be sued,
either express or implied, are granted by either party.”
3.     Procedural History
       San Pasqual filed two lawsuits in Los Angeles Superior Court, that were
consolidated, seeking damages for lost profits allegedly caused by the State’s breach of
the Compact. San Pasqual sought lost profits of $115,000,000 related to the December
2008 license draw, and an additional $200,000,000 in lost profits related to all of the
draws between July 2003 and December 2008 in which it failed to obtain the full number
of licenses for which it applied.
       Thereafter, the State filed a motion for summary judgment in the consolidated
action, raising numerous grounds, including that Section 9.4 of the Compact barred both
San Pasqual and the State from seeking compensatory damages in any action brought
under the Compact. The court granted the State’s motion on that ground, denying the
balance of the motion. Judgment was entered in favor of the State on February 3, 2014.
       This appeal followed.
                                      DISCUSSION
       San Pasqual contends the State breached the Compact by refusing to issue it the
full number of gaming licenses to which it was entitled under the Compact during the
license draws conducted between 2003 and 2008. San Pasqual contends it suffered
monetary damages in the form of lost profits for those years in which it could not operate
its full complement of slot machines in accordance with the Compact. San Pasqual
argues the contract claim for damages is not barred by Section 9.4 because that section
only waives sovereign immunity and is not a waiver of the right to damages. San Pasqual
contends the provision is therefore not relevant to any claim for breach of contract
because the State enjoys no immunity for the breach of a contract to which it is a party.
We agree with the State that Section 9.4 is unambiguous, applies to this action, and bars
San Pasqual’s damages claim.
       “We independently review an order granting summary judgment.” (Shugart v.
Regents of University of California (2011) 199 Cal.App.4th 499, 504.) The dispositive

                                             9
issue on summary judgment below was the interpretation of Section 9.4. The trial court
determined that issue as a matter of law, finding the provision was not ambiguous and
that to the extent San Pasqual offered evidence to explain the meaning of the provision, it
was not relevant. “The trial court’s determination of whether an ambiguity exists is a
question of law, subject to independent review on appeal.” (Benach v. County of Los
Angeles (2007) 149 Cal.App.4th 836, 847.) “On issues of contractual interpretation
where there is no conflicting extrinsic evidence, the appellate court is not bound by the
trial court’s interpretation and will decide the issue de novo.” (Ibid.; accord, Titan Group
v. Sonoma Valley County Sanitation District (1985) 164 Cal.App.3d 1122, 1127.)
       “[W]e are permitted to consider extrinsic evidence when interpreting the Compact
as a matter of law if the language of the provisions is reasonably susceptible to the
interpretation of the party proffering the evidence. [Citation.] We use a two-step process
to determine whether extrinsic evidence passes the reasonable susceptibility barrier.”
(Colusa II, supra, 618 F.3d at pp. 1075-1076.) “First, the court considers, without
admitting, credible evidence concerning the parties’ intentions to determine whether the
language is reasonably susceptible to a party’s interpretation. . . . Second, if the language
is reasonably susceptible to the party’s interpretation, the extrinsic evidence is admitted
to aid interpreting the contract. . . . If the language at issue is not reasonably susceptible
to the interpretation urged by the party, extrinsic evidence should not be considered.”
(Id. at p. 1076; accord, Wolf v. Walt Disney Pictures & Television (2008) 162
Cal.App.4th 1107, 1126-1127 (Wolf), citations omitted.)
       The only extrinsic evidence of intent offered was the declaration of Allen Lawson,
San Pasqual’s chairperson. Mr. Lawson attested that “[a]t the time the Compact was
signed [San Pasqual] did not intend to waive any right to obtain damages if San Pasqual
was wrongfully refused gaming device licenses.”        The proffered evidence fails, under
the first step of our analysis, to qualify as relevant evidence. “ ‘[E]vidence of the
undisclosed subjective intent of the parties is irrelevant to determining the meaning of
contractual language.’ [Citation.] Rather, it is the outward manifestation or expression

                                              10
of assent that is controlling.” (Berman v. Bromberg (1997) 56 Cal.App.4th 936, 948,
italics added.)
       Accordingly, we are tasked with independently reviewing Section 9.4 and
construing its meaning and purpose as a matter of law, without consideration of extrinsic
evidence. General principles of federal contract law govern our interpretation of the
Compact which was entered into pursuant to the Act. (Colusa II, supra, 618 F.3d at
p. 1073.) But, “[i]n practical terms, we rely on California contract law and Ninth Circuit
decisions interpreting California law because we ‘discern . . . no difference between
[California] and federal contract law.’ [Citation.]” (Ibid.)
       When, as here, “a contract is reduced to writing, the intention of the parties is to be
ascertained from the writing alone, if possible.” (Civ. Code, § 1639.) The intent of the
contracting parties is ordinarily a legal question determined solely by reference to the
contract’s terms. (Wolf, supra, 162 Cal.App.4th at p. 1126.) In other words, in reviewing
a written contract, we look to the objective manifestation of the parties’ intent as
expressed by the language of the agreement. (§ 1638 [“The language of a contract is to
govern its interpretation, if the language is clear and explicit, and does not involve an
absurdity”].) Further, “[a] contract must be so interpreted as to give effect to the mutual
intention of the parties as it existed at the time of contracting, so far as the same is
ascertainable and lawful.” (§ 1636, italics added.)
       It is well established that “[p]arties may, by contract, limit the remedies available
to them in the event of breach.” (15 Corbin on Contracts (2003 rev. ed.) § 83.7, p. 286.)
This includes agreeing “to limit or forgo certain remedies.” (Ibid.; see also United States
v. Winstar Corporation (1996) 518 U.S. 839, 886, fn. 30, italics added, citing Rest.2d of
Contracts, § 346, comm. a (1981) [“ ‘Every breach of contract gives the injured party a
right to damages against the party in breach’ unless ‘the parties . . . by agreement vary
the rules’ ”]; accord, 1 Witkin, Summary of Cal. Law (10th ed. 2005) Contracts, § 855,
p. 942 [“The contract may specify particular remedies to be available in the event of a
breach, in addition to or in substitution for those otherwise afforded by law.”].)

                                              11
       In relevant part, Section 9.4(a) of the Compact provides: “In the event that a
dispute is to be resolved in federal court or a state court of competent jurisdiction as
provided in this Section 9.0, the State and the Tribe expressly consent to be sued therein
and waive any immunity therefrom that they may have provided that: [¶] (1) The dispute
is limited solely to issues arising under this Gaming Compact; [¶] (2) Neither side
makes any claim for monetary damages (that is, only injunctive, specific performance,
including enforcement of a provision of this Compact requiring payment of money to one
or another of the parties, or declaratory relief is sought); and [¶] (3) No person or entity
other than the Tribe and the State is party to the action.”
       Section 9.4(a)(2) of the Compact by its plain terms is a waiver of damages
provision. San Pasqual contends the placement of the damage waiver language after the
phrase “provided that” reflects an intent by the parties to limit its application to only
those actions where a waiver of sovereign immunity and consent to suit is required. San
Pasqual argues since the State is not immune from liability for breach of the Compact, it
has no immunity to waive, so the waiver of damages does not apply.
       San Pasqual relies primarily on Hall v. University of Nevada (1972) 8 Cal.3d 522
(Hall), a case involving a claim of sovereign immunity from tort liability. We
emphasize, the case did not involve a contractual waiver of liability for damages. There,
the Supreme Court reversed an order quashing service on the state of Nevada and its
university. (Id. at p. 523.) A California resident had sued the two defendants for
damages arising from an auto accident caused by a university employee driving a
university-owned car in California within the course and scope of his employment.
(Ibid.) The Supreme Court concluded that Nevada did not enjoy sovereign immunity
from suit in California for such a claim. (Id. at p. 524.) In so concluding, the Supreme
Court found it unnecessary to consider the parties’ dispute whether Nevada had
“abrogated sovereign immunity by statute,” or whether the statute in dispute only
permitted suits in Nevada, because there was no immunity from liability for Nevada’s
activities in California. (Id. at p. 526, fn. 4.) “[T]he extent to which Nevada has waived

                                              12
immunity by statute and the extent, if any, to which it can or has limited the statutory
waiver is immaterial.” (Ibid.)
       Hall did not involve parties to a written contract who had negotiated specific
provisions for the waiver of immunity provided there was no claim for monetary
damages. We do not find Hall instructive at all, nor do we agree with San Pasqual’s
characterization of Section 9.4(a) of the Compact. Giving the damage waiver provision a
fair reading, we find it to be an unambiguous bilateral provision, applicable when either
party resorts to a judicial forum for resolving any dispute arising under the Compact.
Such a construction is reasonable given the context surrounding the formation of the
Compact entered into by two independent sovereigns. Section 9.4 must be viewed within
that broader context. (Civ. Code, § 1647 [“A contract may be explained by reference to
the circumstances under which it was made, and the matter to which it relates”].)
       By design, the Act limits the permissible negotiating topics between a state and a
tribe “in order to ensure that tribal-state compacts cover only those topics that are related
to gaming and are consistent with [the Act’s] stated purposes.” (Rincon Band of Luiseno
Mission Indians of the Rincon Reservation v. State of California (9th Cir. 2010) 602 F.3d
1019, 1028-1029, fn. omitted.) Of relevance here, the Act expressly identifies “remedies
for breach of contract” as one of the permissible negotiating topics for the parties to
resolve in crafting a tribal compact. (25 U.S.C. § 2710(d)(3)(C)(v); see also, Rincon, at
pp. 1027-1029, 1039 [“[The Act] anticipates a very specific exchange of rights and
obligations”].) As the Supreme Court recently noted, a tribal compact under the Act
“typically prescribes rules for operating gaming, allocates law enforcement authority
between the tribe and State, and provides remedies for breach of the agreement’s terms.”
(Michigan v. Bay Mills Indian Community (2014) __ U.S. __ [134 S.Ct. 2024, 2028-
2029], italics added (Bay Mills).)
       Both Section 1.0 and Section 9.1 acknowledge the import of the fact the Compact
is an agreement between two sovereign entities. Section 1.0 provides in relevant part that
the “terms of this Gaming Compact are designed and intended to: [¶] (a) Evidence the
goodwill and cooperation of [San Pasqual] and State in fostering a mutually respectful

                                             13
government-to-government relationship that will serve the mutual interests of the
parties.” Section 9.1, the first paragraph of the dispute resolution section, provides: “In
recognition of the government-to-government relationship of [San Pasqual] and the State,
the parties shall make their best efforts to resolve disputes that occur under this Gaming
Compact by good faith negotiations whenever possible.”
       Section 9.0 of the Compact contains detailed dispute resolution procedures with a
clear emphasis on good faith meet and confer efforts and informal dispute resolution, and
an avoidance of protracted court litigation. Section 9.1 outlines, as a “threshold”
requirement, a meet and confer process as the first stage in resolving disputes “in order to
foster a spirit of cooperation and efficiency in the administration and monitoring of
performance and compliance by each other with the terms, provisions, and conditions of
this Gaming Compact.” If those efforts failed, the parties would attempt voluntary non-
judicial dispute resolution alternatives. (Secs. 9.2 & 9.3.) If necessary or where
emergency relief was deemed appropriate, the parties could seek redress in a judicial
forum. (Secs. 9.1(d) & 9.4.)
       In the event resort to court action was necessary, Section 9.4 of the Compact
provides that “the State and the Tribe expressly consent to be sued therein and waive any
immunity therefrom that they may have.” The use of “may” evinces the parties’
acknowledgment that both parties may not have complete or even partial immunity for all
potential disputes. But, for those disputes authorized by the Compact that require resort
to a judicial forum, the parties agreed to waive whatever immunity they “may” have,
provided that the suit was limited to issues under the Compact, neither side sued for
monetary damages, and there was no third party.
       The fact Section 9.4 is titled “Limited Waiver of Sovereign Immunity” is not
determinative of the scope of the provision. The language of the section, and its context
within the larger Section 9.0, is more illuminating of the parties’ intent. A bilateral
damage waiver provision is more consistent with the dispute resolution scheme created
by the parties, than the alternative urged by San Pasqual.

                                             14
       It is true that the State ordinarily does not enjoy any sovereign immunity for
breaches of contract. (See generally, Souza & McCue Construction Co. v. Superior
Court of San Benito County (1962) 57 Cal.2d 508, 510.) But, San Pasqual does. “ ‘As a
matter of federal law, an Indian tribe is subject to suit only where Congress has
authorized the suit or the tribe has waived its immunity. [Citations.]’ (Kiowa Tribe of
Okla. v. Manufacturing Technologies, Inc. (1998) 523 U.S. 751, 754.) This immunity
extends to a tribe’s commercial activities. (Id. at p. 760.)” (Big Valley Band of Pomo
Indians v. Superior Court (2005) 133 Cal.App.4th 1185, 1191; see also Bay Mills, supra,
134 S.Ct. at p. 2028.) In enacting the Act, Congress provided only a narrow waiver of
tribal sovereign immunity to allow a state to bring a federal court action solely to enjoin
gaming activity on tribal land being conducted in violation of a tribal compact.
(25 U.S.C. § 2710(d)(7)(A)(ii); see also Bay Mills, pp. 2030-2032, 2034, fn. 6.)
       If San Pasqual’s construction of Section 9.4 were credited, a provision
unequivocally drafted with bilateral language would, in practical effect, be wholly one-
sided. San Pasqual would be free to seek unlimited damage claims against the State for
alleged breaches of the Compact, but the State would not have the ability to seek
damages in any context. Such an outcome is at odds with the clear intent manifested by
the parties’ language that their dispute resolution efforts would be focused on facilitating
the good faith performance of the Compact in order to allow for the operation of gaming
on tribal lands in accordance with the letter and spirit of the Act. Our construction of
Section 9.4 gives effect to the stated purposes of the Compact and effectuates the mutual
interests of San Pasqual and the State. San Pasqual’s lopsided construction of the
provision does not.
       San Pasqual’s remaining arguments do not merit lengthy discussion. San Pasqual
argues that the following language in Section 9.3 defeats Section 9.4 from operating as a
general waiver of damages: “This Section 9.0 may not be construed to waive, limit, or
restrict any remedy that is otherwise available to either party, nor may this Section be
construed to preclude, limit, or restrict the ability of the parties to pursue, by mutual
agreement, any other method of dispute resolution.” The focus of Section 9.3 is other

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nonjudicial dispute resolution alternatives. In contrast, the focus of Section 9.4 is a
lawsuit in federal or state court. “Specific terms of a contract govern inconsistent, more
general terms.” (Idaho v. Shoshone-Bannock Tribes (9th Cir. 2006) 465 F.3d 1095,
1099.)
         San Pasqual’s contention that Section 9.4 must be construed against the State as
the “drafter” of the Compact is not persuasive. San Pasqual argues the State prepared the
final draft of the Compact, and presented it to San Pasqual on a “take it or leave it” basis.
The State counters that substantially identical immunity and damage waiver language
was included in the model compact that San Pasqual, as a member of the Committee,
proposed as its initial draft in opening negotiations with the State in early 1999.3
         Civil Code section 1654 provides: “In cases of uncertainty not removed by the
preceding rules, the language of a contract should be interpreted most strongly against the
party who caused the uncertainty to exist.” However, the rule is inapplicable “where it
does not appear who caused the uncertainty . . . . [citations], or where the language is so
clear that no uncertainty exists to be resolved by such construction [Citations.]
Moreover, the rule applies only as a tiebreaker when the other canons of construction fail
to dispel the uncertainty.” (1 Witkin, Summary of Cal. Law (10th ed. 2005) Contracts,
§ 757, pp. 849-850.) This rule of construction does not apply, first, because the disputed
Compact language is not uncertain and, second, because the State did not cause the
waiver of damages to be included in the Compact.

3       Section 9.4 of the model compact, also titled “limited waiver of sovereign
immunity,” read, in relevant part, as follows: “In the event that a dispute is to be resolved
in federal court or a court of competent jurisdiction as provided in Section 9.1, the State
and the Tribe expressly consent to be sued therein and waive any immunity therefrom
that they may have, provided that: [¶] (1) The dispute is limited solely to issues arising
under this Gaming Compact; [¶] (2) Neither side makes any claim for monetary
damages (that is, only injunctive, specific performance, or declaratory relief is sought);
and [¶] (3) No person or entity other than the Tribe and the State are parties to the
action.” (Gov. Code, § 98004.)

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       San Pasqual also fails to show Section 9.4 is unconscionable. Indeed, the record
shows the provision was part of a compact that was crafted initially by a tribal coalition,
the final version was the end result of months of negotiations, and Section 9.4 is bilateral,
imposing mutual rights and obligations on both parties. It does not purport to exempt the
State from violations of law as asserted by San Pasqual.
       San Pasqual’s citation to the Indian canon of construction is equally unavailing.
Treaties and agreements between the federal government and Indian tribes are generally
construed in the tribe’s favor. (United States v. Confederated Tribes of the Colville
Indian Reservation (2010) 606 F.3d 698, 708-709.) The rule of construction is also
applied to the interpretation of ambiguous federal statutes enacted for the benefit of
Indian tribes. (Artichoke Joe’s California Grand Casino v. Norton (9th Cir. 2003)
353 F.3d 712, 728-729.) The rule is “ ‘ “rooted in the unique trust relationship between
the United States and the Indians.” ’ [Citation.]” (Id. at p. 729, italics added.) San
Pasqual has not cited any authority for the application of the rule to the interpretation of a
written contract between a state and a tribe. In any event, we have concluded Section 9.4
is not ambiguous and we need not resort to this rule of construction.
       Finally, San Pasqual offered evidence that a compact entered into between the
State and another tribe in 2012 contains language evincing a clear intent to waive
damages, in contrast to the provision contained in the Compact. San Pasqual argues the
provision in that other tribal compact lends credence to its contention the parties never
intended Section 9.4 to operate as a general waiver of damages.      However, Section 15.3
of the Compact provides: “Neither the presence in another tribal-state compact of
language that is not included in this Compact, nor the absence in this Compact of
language that is present in another tribal-state compact shall be a factor in construing the
terms of this Compact.”    The compact with another tribe executed by the State 13 years
after the execution of the Compact with San Pasqual is therefore not relevant to
interpreting Section 9.4. We have not considered it.

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                                     DISPOSITION
       The judgment entered in favor of defendants and respondents the State of
California and the California Gambling Control Commission is affirmed. Defendants and
respondents shall recover their costs on appeal.

                                                       GRIMES, J.

       WE CONCUR:

                     FLIER, Acting P. J.

                     OHTA, J.*

*       Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to
article VI, section 6 of the California Constitution.

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