Supreme Court Directs State Court to Decide Whether Indian Tribe Can Invoke Sovereign Immunity in Property Dispute

Supreme Court Directs State Court to Decide Whether Indian Tribe Can Invoke Sovereign Immunity in Property Dispute

Legal Sidebari

Supreme Court Directs State Court to Decide
Whether Indian Tribe Can Invoke Sovereign
Immunity in Property Dispute
July 16, 2018
Indian tribes possess “inherent sovereign authority,” which means, among other things, that they cannot
be subject to lawsuits unless the tribe waives or Congress expressly abrogates such immunity. Recently,
the Supreme Court in Upper Skagit Indian Tribe v. Lundgren ruled that a Washington state court
erroneously rejected an Indian tribe’s claim that sovereign immunity foreclosed a lawsuit involving a
property dispute between two landowners and the tribe. Citing the Supreme Court’s 1992 decision in
County of Yakima v. Confederated Tribes and Bands of Yakima Indian Nation, the state court had reasoned
that an Indian tribe’s claim of sovereign immunity did not bar courts from exercising jurisdiction to settle
disputes over real property. In reversing the state court’s decision, the Supreme Court held that the state
court’s reliance on Yakima was misplaced because that case did not address the scope of tribal sovereign
immunity, but only concerned the question of whether a particular federal law permitted state taxation of
certain land within an Indian reservation. The Supreme Court directed the lower court to address the
plaintiffs’ new contention that an Indian tribe cannot assert sovereign immunity in an action relating to
immovable property located in in the territory of another sovereign, namely, in another state. While the
Supreme Court’s decision clarifies its ruling in Yakima, the Court’s decision leaves unresolved the
underlying issue of whether an Indian tribe may invoke sovereign immunity in cases involving disputes
over real property.
Legal Background: County of Yakima v. Confederated Tribes and Bands of
Yakima Indian Nation
In Yakima, the Supreme Court considered whether the Indian General Allotment Act of 1887 (GAA)
permitted a state to impose property and sales taxes on “fee patented” land within an Indian reservation.
The GAA, which reflected Congress’s intent “to extinguish tribal sovereignty, erase reservation
boundaries, and force the assimilation of Indians into the society at large,” authorized the United States
government to allot parcels of reservation land to Indians individually, and to hold the allotted land “in
trust for the sole use and benefit of the Indian” for at least 25 years, after which a patent-in-fee would
issue to the Indian. The GAA, as amended, provided that, upon issuance of a patent-in-fee, an Indian
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would be subject to the civil and criminal laws of the state where he resided, and “all restrictions as to
sale, incumbrance, or taxation of said land shall be removed.” Ultimately, in 1934, Congress passed the
Indian Reorganization Act (IRA), which intended “to encourage Indian tribes to revitalize their self-
government.” Among other provisions, the IRA ended the allotment of land to Indians, indefinitely
extended the existing periods of trust applicable to already-allotted lands not alienated, and authorized the
U.S. government to restore unallotted surplus Indian lands to tribal ownership. The IRA’s discontinuation
of the allotment policy and subsequent legislation concerning the reach of state law within reservation
lands have been interpreted to mean that the GAA no longer authorized plenary state jurisdiction over
Indians living on fee-patented lands.
That said, the Supreme Court ruled in Yakima that the GAA, as amended, authorized states to tax fee-
patented lands on an Indian reservation. The Court determined that the IRA did not preclude state taxation
of fee-patented lands, reasoning that, although Congress’s policy of tribal self-government effectively
barred the exercise of state in personam jurisdiction over members of an Indian tribe based on their
activities or transactions on that land, “the mere power to assess and collect a tax on certain real estate” is
not “significantly disruptive” of tribal self-government. The Court thus concluded that the GAA permitted
Yakima County to impose a property tax on fee-patented reservation land, but did not allow the county to
enforce a sales tax on such land because the GAA limited a state’s jurisdiction to taxation of the land
itself, not to the sale of such land.
Facts and Procedural History in Upper Skagit
The Upper Skagit Tribe (Tribe), located in the State of Washington, sought to expand its Indian
reservation by purchasing forty acres of land that had been originally included in a tract of land that was
ceded under an 1855 treaty. Following a survey of the newly purchased land, the Tribe discovered that an
acre of the land extended beyond a barbed wire fence into land owned by its neighbors (the Lundgrens).
The Tribe informed the Lundgrens of its plan to remove the fence and establish a new boundary line
between their respective properties in light of the survey. In response, the Lundgrens filed a quiet title
action in state court, arguing that they had obtained title to the property claimed by the Tribe through
adverse possession or mutual recognition and acquiescence long before the Tribe bought the land. The
Tribe moved to dismiss the lawsuit based, in part, on its right to “the common-law immunity from suit
traditionally enjoyed by sovereign powers.” A trial court denied the Tribe’s motion to dismiss and,
following an appeal of that decision, an appellate court ruled that the Lundgrens had established title to
the disputed property.
On appeal to the Washington Supreme Court, the Tribe maintained that it had sovereign immunity from
the Lundgren’s lawsuit, and that neither the Tribe nor Congress had waived such immunity to determine
ownership of real property. The Tribe argued that the fact that a claim involves real property “does not
affect or somehow avoid threshold jurisdictional questions such as sovereign immunity.” The Lundgrens
acknowledged that the Tribe had sovereign immunity, but argued that, because the trial court had in rem
jurisdiction over the real property itself, the court did not need to have personal jurisdiction over the
Tribe, and, therefore, sovereign immunity was irrelevant.
The Washington Supreme Court affirmed the denial of the Tribe’s motion to dismiss, ruling that “[a] court
exercising in rem jurisdiction [to determine title to real property] is not necessarily deprived of its
jurisdiction by a tribe’s assertion of sovereign immunity.” Significantly, the court cited the Supreme
Court’s decision in Yakima for the proposition that sovereign immunity applies only when a state seeks to
exercise in personam jurisdiction over an Indian tribe itself, but not when the state seeks to exercise in
rem jurisdiction over the real property within an Indian reservation.

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The Supreme Court’s Decision in Upper Skagit
In its petition for Supreme Court review, the Tribe argued that the Washington Supreme Court erred by
carving out an in rem exception to immunity when a court exercises jurisdiction to determine ownership
of real property. The Tribe argued that the Supreme Court never recognized such an exception in Yakima,
which “merely clarifie[d] the jurisdiction to tax afforded to states pursuant to Section 6 of the GAA.” In
response, the Lundgrens did not dispute the Tribe’s contention, but urged the Supreme Court to recognize
an exception to tribal sovereign immunity based on the common law concept that sovereigns have no
immunity from suits involving “immovable property” located in the territory of another sovereign. Based
on this doctrine, the Lundgrens argued, the Tribe could not invoke sovereign immunity because their
lawsuit related to immovable property located in the State of Washington that the Tribe had purchased in
“the character of a private individual.”
In a 7-2 decision, the Supreme Court reversed the Washington Supreme Court’s decision. In the majority
opinion written by Justice Gorsuch (joined by Chief Justice Roberts and Justices Kennedy, Ginsburg,
Breyer, Sotomayor, and Kagan), the Court held that the state court erroneously relied on Yakima in
concluding that sovereign immunity does not prevent courts from exercising in rem jurisdiction to settle
disputes over real property within an Indian reservation. The Court explained that Yakima did not address
the scope of tribal sovereign immunity, and only involved the “much more prosaic question” of whether
the GAA permitted states to collect property taxes on fee-patented land within Indian reservations.
The Court noted that, instead of disputing the fact that Yakima “resolved nothing about the law of
sovereign immunity,” the Lundgrens raised an “entirely distinct” argument based on the immovable
property exception to sovereign immunity. The Court, however, declined to address the Lundgrens’ newly
advanced claim, reasoning that “[d]etermining the limits on the sovereign immunity held by Indian tribes
is a grave question; the answer will affect all tribes, not just the one before [the Court]; and the alternative
argument for affirmance did not emerge until late in this case.” Therefore, the Court remanded the case to
the Washington Supreme Court to address the Lundgrens’ arguments in the first instance.
In a concurring opinion, Chief Justice Roberts (joined by Justice Kennedy) agreed with the Court’s
decision, but questioned how a person should resolve a property dispute with an Indian tribe, noting that
“a tribe could wield sovereign immunity as a sword and seize property with impunity, even without a
colorable claim of right.” Chief Justice Roberts suggested that the solution may be to recognize an
exception for legal actions to determine ownership rights in immovable property located in another
sovereign, but acknowledged that it was unclear “whether different principles afford Indian tribes a
broader immunity from actions involving off-reservation land.” Chief Justice Roberts argued that, if such
an exception did not apply to Indian tribes, the scope of tribal sovereign immunity would “need to be
addressed in a future case.”
In a dissenting opinion, Justice Thomas (joined by Justice Alito) argued that the Court should have
considered whether the immovable property exception applied to the Tribe’s sovereign immunity claim,
even if the Lundgrens had not previously raised that issue, because it was a “well established” exception
to sovereign immunity. Justice Thomas further argued that Indian tribes do not enjoy more expansive
immunity than other sovereign powers, and were thus subject to “longstanding limits on sovereign
immunity, such as the immovable property exception.” Otherwise, Justice Thomas argued, Indian tribes
would possess “a sweeping and absolute immunity that no other sovereign has ever enjoyed—not a State,
not a foreign nation, and not even the United States.” Justice Thomas concluded that the Court’s decision
left state and federal courts “with little more guidance than they had before” regarding the scope of tribal
sovereign immunity, and “needlessly delay[ed] relief for the Lundgrens, who must continue to litigate the
threshold question whether they can litigate their indisputable right to their land.”

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Implications of the Court’s decision
Courts have previously been divided over the extent to which tribal sovereign immunity bars courts from
exercising jurisdiction in legal actions concerning the property rights of Indian tribes, and, in particular,
whether the Supreme Court’s decision in Yakima created an exception to tribal sovereign immunity for in
rem proceedings over real property. In Upper Skagit, the Supreme Court has now clarified that its
decision in Yakima did not concern the scope of tribal sovereign immunity, but only addressed the
narrower statutory question of whether the GAA permitted the taxation of certain land within an Indian
reservation. Consequently, reviewing courts seemingly may no longer rely on Yakima in addressing the
applicability of tribal sovereign immunity.
Yet despite the Supreme Court’s clarification of Yakima, there remains an unresolved question concerning
the extent to which an Indian tribe may invoke sovereign immunity in cases involving real property
rights—an issue that had arguably prompted the Court to agree to review the Washington Supreme
Court’s decision in Upper Skagit. Nevertheless, in an exercise of restraint, the Court expressly declined to
address that “grave question” and, instead, directed the state court to consider whether the immovable
property exception grounded in common law applies to tribal sovereign immunity. Given the Court’s
narrow ruling, the conflicting rulings of state and federal courts concerning the applicability of tribal
sovereign immunity in real property disputes “will persist” for the time being, and it is not certain whether
this threshold jurisdictional question will return to the Court anytime soon.
In view of this uncertainty, Congress may consider legislative options to resolve the disagreement over
the applicability of tribal sovereign immunity in cases involving real property. As the Supreme Court has
observed, tribal sovereign immunity is a “broad principle” subject to the plenary power of Congress, and
“it is fundamentally Congress’s job, not [the Court’s], to determine whether or how to limit tribal
immunity.” In particular, Congress may consider whether there should be any distinction between in
rem and in personam proceedings for purposes of applying tribal sovereign immunity, as some courts
have concluded; whether the immovable property exception should apply to tribal sovereign
immunity, as Justice Thomas argues; or whether there should be other circumstances in which tribal
sovereign immunity may be restricted, as Congress has provided in past legislation. Further, the
Supreme Court’s decision in Upper Skagit raises other considerations. In his concurring opinion,
Chief Justice Roberts questioned how an individual can resolve a dispute over real property with an
Indian tribe in the face of sovereign immunity, and warned of the “intolerable” consequences that
could result in the absence of any redress. Congress could consider other legislative options that
address these concerns and establish some “means of resolving property disputes of this sort.”

Author Information

Hillel R. Smith

Legislative Attorney

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