Amicus Curiae Brief — McClanahan v. Arizona Tax Comm'n

TABLE OF. CONTENTS

‘TABLE OF CONTENTS

TABLE OF CITATIONS

_ SUMMARY OF ARGUMENT

ARGUMENT

I. Historical Review of Cases in This Court Re-

flecting Attempts by States to Tax Indians ........

4 Il: Review of Recent Efforts by Congress to Trans-

; fer General Jurisdiction Over Indians to States..

_ “III. Analysis of the Cases Relied on Below

CONCLUSION

ye TABLE OF CITATIONS

Cases:

-* Asenap Vv. United States, 283 F. Supp. 566 (W.D.

‘ Okla. 1968)

Beartrack v. United States, Ct. Cl. Docket 281-67..

Big Eagle v. United States, 300 F.2d 765 (Ct. Cl.

1962)

©. Blackbird v. CIR, 38 F.2@976 (10th Cir. 1930) ....

Carpenter Vv. Shaw, 280 U.S. 363 (1930)

Childers v. Beaver, 270 US. 555 (1926)

Choteau Vv. Burnet, 283 U.S. 691 (1931)

CIR v. Walker, 326 F.2d 261 (9th Cir. 1964)

Commissioner Vv. Brun, 286 Minn. 43, 174 N.W.2d

120 (1970) ....

Draper Vv. United States, 164 U.S. 240 (1896)

‘Ghahate v. Bureau of Revenue, 80 N.M. 98, 451

P.2d 1002 (1969)

Graves V. New York ex rel. O’Keefe, 306 U. S. 466

(1939)

Kake Village v. Egan, 369 U.S. 60 (1962)

Kansas Indians, The, 72 U.S. 737 (1866)

6

6

6, 12

12

TABLE OF CONTENTS—Continued

Kennerly Vv. District Court, 400 U.S. 428 (1971) -.-- 8

Kirkwood v. Arenas, 243 F.2d 868 (9th Cir.

1957) -...-- ‘ 6

Leahy v. State Treasurer of Oklahoma, 297 U.S.

420 (1986) 12

Mason V. United States, —— F.2d —— (June 16,

1972, Ct. Cl. Docket 417-70) 7

Menominee Tribe Vv. United States, 391 U.S. 404

(1968) 11

Metlakatla Indians v. Egan, 869 U.S. 45 (1962) .... 12, 18

Nash v. Wiseman, 227 F. Supp. 552 (W.D. Okla.

1968) 6

Oklahoma Tax Commission Vv. United States, 819

U.S. 598 (1943) A, 5, 6, 7, 12

Squire v. Capoeman, 351 To 5 Chee) od 6, 7, 11

Superintendent Five Tribes vy. Commissioner, 295

U.S. 418 (1935) 6

United States v. Daney, 870 F.2d 791 (10th Cir.

1966) 6

United States v. Hallam, 304 F.2d 620 (10th Cir.

1962) 6

United States v. Rickert, 188 U.S. 482 (1903) -....... 3,5

Utah & Northern Railway v. Fisher, 116 US. 28

(1885) 8

West v. Oklahoma Taz Commission, 334 U.S. 717

(1948) 5, 6,7

Williams V. Lee, 358 U.S. 217 (1959) -....----------------- 8, 14

Worcester Vv. Georgia, 81 U.S. 515 (1823) -...------- 8

Termination Acts:

Alabama and Coushatta Indians, 25 U.S.C. $721 .. 9

California Rancherios, 72 Stat. 619 9,11

Klamath Indians, 25 U.S.C. § 564 9,11

Menominee Indians, 25 U.S.C. §§ 891, 898 -......-.-... 9,11

Mixed-Blood Ute Indians, 25 U.S.C. § 677 -.....------- 9, 11

Ottawa Indians, 25 U.S.C. § 841 9

Paiute Indians, 25 U.S.C. §§ 741, 749 -.....----------- 9,11

Peoria Indians, 25 U.S.C. § 821 9

TABLE OF CONTENTS—Continued

Ponca Indians, 25 U.S.C. §§ 971, 978

Western Oregon Indians, 25 U.S.C. §§ 691, 699 _..

Wyandotte Indians, 25 U.S.C. §§ 791, 798

Miscellaneous: |

86 Ariz. Rev. Stat. §§ 1801, 1865

Buck Act, 4 U‘S.C. §§ 105-109

Federal Indian Law, U.S. Dept. Int., 1958

General Allotment Act of 1887, 24 Stat. 388, 25

US.C. § 331 8, 11,138

House Concurrent Resolution 108, 67 Stat. B182.... 8,9

House Concurrent Resolution 102 (92d Cong.) -... 9

Indian Civil Rights Act, § 401(a), 82 Stat. 77, 25

U.S.C. § 1821 9

Indian Reorganization Act, 48 Stat. 984, 25 U.S.C.

§ 461 13

Public Law 280, 67 Stat. 588, 18 U.S.C. § 1162, 28

U.S.C. § 1360 7, 8, 11, 13

Rev.Rul. 56-342, Cum. Bull. 1956-2

Rev.Rul. 62-16, Cum. Bull. 1962-1

Rev.Rul. 67-284, Cum. Bull. 1967-2

Rev.Rul. 69-164, IRB 1969-14

Senate Concurrent Resolution 26 (92d Cong.)

In THE

Supreme Court of the United States

OCTOBER TERM, 1971

ROSALIND MCCLANAHAN,

Appellant,

V.

ARIZONA STATE TAX COMMISSION,

Appellee.

On Appeal from the Supreme Court of Arizona

BRIEF FOR AMICUS CURIAE,

NATIONAL CONGRESS OF AMERICAN INDIANS

IN SUPPORT OF APPELLANT

STATEMENT OF INTEREST

This brief is filed with the consent of both parties.

' Amicus Curiae, the National Congress of American

Indians (NCAI), is a nonprofit association of some 147

Indian tribes, including virtually all of the major or-

ganized tribes (but not including the Navajo Tribe,

appellant’s tribe). Its purpose is to promote the in-

terests of American Indians. It was incorporated in

Oklahoma in 1954, and its national headquarters is at

1346 Connecticut Avenue, N.W., Washington, D.C.

NCAI supports the position of the Appellant Navajo

Indian, Rosalind McClanahan, and joins her in asserting

that the decision of the Arizona Supreme Court was

erroneous. NCAI is deeply concerned with the Arizona

court’s decision, because it represents one more example

of a state attempting to extend its jurisdiction over a

reservation Indian without the consent of the tribe

governing the reservation. It is a flagrant interference

with and usurpation of the tribe’s governmental powers

over its people. It is wrong in every case where the

tribe has not consented, and it is illegal in this case

because Congress has not consented.

SUMMARY OF ARGUMENT

We believe the Appellant’s brief, and the brief filed

by the Solicitor General July 19, 1972, cover most of the

points ably and correctly.. What we have to say herein

is intended to supplement what they have said, and

hopefully will be helpful to the Court.

In Section I we review the history of the cases in

this Court dealing with attempts by states to tax In-

dians. The early cases involve taxes on property or

income from property. Not until recently have taxes

on income from an Indian’s personal services come into

question,’ but the earlier cases on property taxes are an

essential background for approaching the salary tax

question.

1 Until the instant case, and Comm’r v. Brun, 286 Minn. 43,

174 N.W. 2d 120 (1970) (rejecting the tax) and Ghahate v. Bureau

of Revenue, 80 N.M. 98, 451 P. 2d 1002 (1969) (upholding the

tax}, the only case of which we are aware involving taxes on an

Indian’s wage or salary is CIR v. Walker, 826 F. 2d 261 (9th Cir.

1964), upholding the federal income tax on salary of a tribal

employee.

In Section II we review the modern history of efforts

of Congress to transfer general jurisdiction over Indians

to the states.

In Section III we analyze some of the cases relied on

by the court below.

ARGUMENT

- I. Historical Review of Cases in This Court Reflecting

Attempts by States to Tax Indians

One of the earliest cases (if not the earliest case)

recognizing an Indian’s exemption from state taxes was

the 1866 case of The Kansas Indians, 72 U.S. 787. In

that case this Court held that certain individual Shawnee

lands in Kansas, given to them before Kansas became a

state, were exempt from state property taxes, because

as long as the tribe continued to govern itself as a

distinct entity, Kansas had no jurisdiction over the lands,

having (like Arizona in the principal case) foresworn

such jurisdiction as a condition of its admission into the

Union. At p. 756. This Court said:

“As long as the United States recognizes their na-

tional character they are under the protection of

treaties and the laws of Congress, and their prop-

erty is withdrawn from the operation of State laws.”

At p. 757.

In 1903 this Court in United States v. Rickert, 188

U.S. 482, held that Sioux trust allotments under the

General Allotment Act of 1887 (which provided that the

allotments were to be free of incumbrance) were exempt

from South Dakota property taxes. This Court relied

on two rationales—(1) that the allotment was a federal

instrumentality and hence not taxable by the state, and

(2) that if the trust property is to be free of incum-

brance, it must be free of taxes. Not only was the land

6

held exempt from state taxes, but horses, cows and

wagons on the land as well.

In 1926 this Court held that Oklahoma could not

impose an inheritance tax on a Quapaw’s restricted allot-

ment, because it was federal instrumentality. Childers

v. Beaver, 270 U.S. 555 (1926). In 19380, this Court

held that where a Choctaw allotment was tax exempt

under a treaty, Oklahoma could not impose a tax on

certain mineral rights associated with the allotment, cit-

ing the federal instrumentality rule and Oklahoma’s ac-

ceptance, upon admission into the Union, of the Indians’

tax exempt status. Carpenter v. Shaw, 280 U.S. 368

(1930).

In the late 1930’s and early 1940’s, the federal in-

strumentality doctrine as a basis for exemption from

state taxation was severely limited, first with respect to

federal employees, Graves v. New York ex rel. O'Keefe,

306 U.S. 466 (1939), and later with respect to Indians,

Oklahoma Tax Commission v. United States, 319 US.

598 (1948). The latter case allowed an Oklahoma death

tax on restricted cash and securities belonging to members

of the Five Civilized Tribes, arising from the proceeds

of sale of minerals on the Indians’ restricted land. Some

of the land was concededly exempt from “direct” taxa-

tion (presumably property taxes), and this Court re

fused to allow the death tax on that land. However,

this Court upheld the tax on the cash and securities.

The main significance of the Oklahoma Tax Comm’n

v. United States case is that it overruled the prior as-

sumption that Indians were tax exempt under the federal

instrumentality doctrine. However, it is important not

to read this case as saying that Indians are taxable the

same as anyone else. There were good reasons for hold-

ing those Indians taxable. This Court noted that the

Five Civilized Tribes were not like other tribes; they

had “no effective tribal autonomy,” and had “little to

5

distinguish them from all other citizens except for their

limited property restrictions and their tax exemptions.

Their lands are held in fee, not in trust, as in the

Rickert case... .” At p. 603. Furthermore, Congress

had expressly made the minerals themselves “subject to

all State and Federal taxes”, and therefore, as this

Court reasoned, Congress probably did not intend an

exemption for the proceeds of their sale. At p. 606.

In 1948 this Court decided West v. Oklahoma Taz

Commission, 334 U.S. 717 (1948), another Oklahoma

death tax case. Unlike Oklahoma Tax Comm’n v. United

States, this case involved property held: by the United

States in trust for the Indian, rather than property held

by the Indian in fee subject to restrictions, and involved

an Indian living on an Indian reservation. The de-

ceased Indian was a restricted Osage Indian, and his

property, held in trust by the United States, included

his “headright,” ie. a right to share in the proceeds

of sale of minerals beneath the Osage Reservation. It

was argued, inter alia, (1) that this and certain other

property was held in trust by the United States, and

therefore it was exempt from state taxation, and (2)

that the property was exempt under the federal instru-

mentality rule. This Court rejected these, saying that

Oklahoma Tax Commission v. United States showed that

mere restriction of the property was not the equivalent

of tax immunity, and had overruled the federal instru-

mentality rule. At p. 726.

It is extremely important to note, and the West case

cannot be properly understood otherwise, that when this

Court decided the West case, it was generally assumed

- *This Court did not call the Osage reservation a “reservation,”

but it was and is in fact one, and the Bureau of Indian Affairs

shows it as one on its maps (and as the only reservation still left

in Oklahoma). As this Court recognized, the reservation was held

by the United States in trust for the Osages, and while most of

the land was allotted in trust to Indians, the tribe still owns in

trust some tribal land and all of the minerals under the reservation.

6

that Indians were subject to both federal income and

federal estate taxes with respect to their restricted and

trust property: Today, however, this assumption has

been shown to be incorrect, and Indian trust property

is exempt from both federal income taxes‘ and federal

estate taxes.© Consequently, this Court’s observation in

on the Indians and at the same time exempt them by implication

from similar state taxes.” Page 608 and 608n.12. The brief for the

United States on behalf of the Indians in that case expressly agreed

that Indian trust property was subject to the federal estate tax.

And in the West case, the briefs before the Supreme Court showed

that the Oklahoma Tax Commission stressed that Osage trust

es were then subject to both federal income taxes and

federal estate tax, and West did not dispute this. In 1935, this

Court had held that a restricted Creek Indian’s income from in-

vestment of his trust funds was subject to federal income tax.

Ss : Five Tribes v. Commissioner, 295 US. 418 (1935).

Until Squire.v. Capoeman, note 4 below, this was assumed to apply

to all Indian income; however, the Squire case limited the Super-

intendent ruling to reinvestment income only, and held that income

4 Squire v. Capoeman, 351 U.S. 1 (1956), held that a restricted

Indian was exempt from federal capital gains tax on proceeds

of sale of trust timber. The cases and the Internal Revenue Service

have interpreted this to apply to federal income taxes on all income

trust land, including from farming, grazing, sale of minerals,

ete. United States v. Daney, 870 F.2d 791 (10th Cir. 1966); Big

agle V. United States, 300 F.2d 765 (Ct. Cl. 1962) ; United States

Hallam, 304 F.2d 620 (10th Cir. 1962) ; Rev.Rul. 56-842, Cum.

Il. 20; and Rev.Rul. 62-16, Cum. Bull. 1962-1; Rev.Rul.

67-284, Cum. Bull. 1967-2, 55; and see also Kirkwood v. Arenas,

248 F.2d 863 (9th Cir. 1957) (California income taxes barred).

5 Nash v. Wiseman, 227 F.Supp. 552 (W.D.Okla. 1963) ; Asenap

. United States, 288 F.Supp. 566 (W.D.Okla. 1968). In 1967 8

in the Court of Claims on behalf of a deceased re-

stricted Osage Indian, Beartrack v. United States, Docket 281-67.

This case sought refund of federal estate taxes previously collected.

In 1968, after trial, the Government capitulated, and the Internal

Revenue Service proceeded voluntarily to give refunds to the estates

of all deceased restricted Osage Indians. See Rev.Rul. 69-164,

IRB 1969-14, 20. Eventually some $4.6 million was refunded.

7

the Oklahoma Tax Commission v. United States case (319

U.S. at 608) that “Congress cannot have intended to

impose federal income and inheritance taxes on the

Indians and at the same time exempt them by implica-

tion from similar state taxes’* is turned around to

exactly the reverse: i.e., if Congress intended to bar

federal income and death taxes on trust property, as the

courts have now established, then a fortiori it can hardly

have intended by implication to allow the states to impose

such taxes.’

As the Court will observe, the above cases deal with

state attempts to tax Indian trust or restricted property

(or income therefrom), and not with attempts to tax

income from the tribal Indian’s own labors. With respect

to the latter, we will concede that we are aware of no

congressional statute expressly or impliedly conferring

any tax exemption. Instead, the exemption is found in

the general legal status of tribal Indians, which is that,

as subjects of semi-independent tribal sovereigns, they

are subject to their own laws exclusively, except to the

extent that Congress has by statute extended federal

jurisdiction to them, or authorized the states to do so.

Arizona has no general jurisdiction over the Navajo

Reservation, having declined to accept Public Law 280

(see text at note 9 below), nor has Arizona ever been

authorized to extend its taxing laws onto the reservation

and attach to Indians living thereon. Consequently, the

tax in this case is invalid.

*In any case, this is a very dubious syllogism, in light of the

emerging consensus on Indian taxation and relationships with

states.

'The rationale of the West case was impliedly overruled by this

Court in Squire v. Capoeman, 351 U.S. 1 (1956), discussed in note

4 above. This overruling has been impliedly recognized by a num-

ber of lower court rulings in analogous cases since 1956, and the

overruling has been explicitly recognized and fully disc#issed by the

Court of Claims in a recent case involving the same tribe of In-

dians as in the West case. Mason v. United States, ———_ F.2d ——

(June 16, 1972, Docket 417-70.) The Mason heirs intend to file an

_ amicus brief quoting the Court of Claims opinion.

8

IL Review of Recent Efforts by Congress to Transfer

General Jurisdiction Over Indians to States

Prior to 1953, Indian reservations ordinarily were

subject to federal and tribal law exclusively, and state

law did not apply to Indians on the reservation.*

In 1958 a wave of feeling erupted in Congress to “get

out of the Indian business.” In that year it passed

House Concurrent Resolution 108 (88rd Congress) that

it was :

“ . . the policy of Congress, as rapidly as possible,

to make the Indians within the territorial limits of

the United States subject to the same laws and

entitled to the same privileges and responsibilities

as are applicable to other citizens of the United

States... .” 67 Stat. B132.

In the same year, Congress enacted Public Law 280,

67 Stat. 588, 18 U.S.C. $1162, 28 U.S.C. § 1360, ex-

tending state law and state court jurisdiction to Indian

reservations in California, Minnesota (except Red Lake

Reservation), Nebraska, Oregon (except Warm Springs

Reservation), and Wisconsin (except Menominee Reser-

vation). The Act invited other states to extend their

civil and criminal jurisdiction to Indian reservations,

and to date eight additional states have done so, in

whole or in part (Alaska, Florida, Idaho, Montana, Ne-

vada, North Dakota, South Dakota and Washington).°

8 Worcester V. Georgia, 31 U.S. 515 (1823) ; Williams v. Lee, 858

US. 217 (1959) ; Kennerly v. District Court, 400 U.S. 428 (1971);

US. Dept. Int., Federal Indian Law (1958) ; 845-6. However, state

law does enter an Indian reservation and apply to non-Indians there.

Draper Vv. United States, 164 U.S. 240 (1896) (criminal law) ; Utah

& Northern Railway v. Fisher, 116 U.S. 28 (1885) (tax law).

*Even prior to Public Law 280, a few states had been given

certain jurisdiction over Indian reservations by special statute,

eg. in New York and Kansas.

9

Arizona has not done so, unless certain limited pollution

legislation is considered as such.”

Another manifestation of Congress’ then mood was

the so-called “termination” acts. This movement began

in 1954 with the termination of federal supervision over

“six Indian groups. However, problems caused by ter-

mination, and Indian and non-Indian opposition, soon

caused this movement to peter out.”

House Concurrent Resolution 108 is no longer the

policy of Congress. Even if it survived the 83d Congress

as a viable instrument to express Congress’ wishes,

which is dubious, the Senate repealed it on December

11 1971 (S. Con. Res. 26, 92d Cong.), and the House

is considering repealing it (H. Con. Res. 102, 92d Cong.).

Public Law 280 is still on the books, but in 1968 Congress

re-enacted it as part of the Indian Civil Rights Act,

82 Stat. 77, and added the fundamental requirement that

no state could thereafter extend its jurisdiction to an

Indian reservation without the tribe’s consent. Section

401(a), 82 Stat. 78, 25 U.S.C. §§ 1821, 1322.

As for the termination movement, no tribe has been

terminated since 1962, and the Menominee Tribe is en-

deavoring to persuade Congress to repeal the Menominee

Termination Act. S. 3514 and H.R. 14556, 92d Congress.

President Nixon’s message to Congress of July 8, 1970,

declared the Administration’s position as follows:

1036 Ariz. Rev. Stat. § 1801, 1865. As the Govt’s brief points

out, p. 15n.5, an unanswered question is whether a state may

validly accept only partial jurisdiction under Public Law 280.

11 Klamath Indians, 25 U.S.C. § 564; Mixed-Blood Ute Indians,

25 U.S.C. § 677; Western Oregon Indians, 25 U.S.C. § 691; Alabama

and Coushatta Indians, 25 U.S.C. § 721; Paiute Indians, 25 U.S.C.

$741; Menominee Indians, 25 U.S.C. § 891.

12 The Wyandotte and Ottawa Indians were terminated in 1956,

25 U.S.C. §§ 791 and 841, and the Peoria Indians and some Cali-

fornia rancherias were terminated in 1958, 25 U.S.C. § 821, and 72

Stat. 619. Since then the only termination act has involved the

Ponca Indians, 25 U.S.C. § 971 (1962).

10

“This policy of forced termination is wrong, in

my judgment, for a number of reasons. First, the

premises on which it rests are wrong. Termination

implies that the Federal government has taken on

a trusteeship responsibility for Indian communities

as an act of generosity toward a disadvantaged

people and that it can therefore discontinue this

responsibility on a unilateral basis whenever it sees

fit, But the unique status of Indian tribes does not

rest on any premise such as this. The special re-

lationship between Indians and the Federal govern-

ment is the result instead of solemn obligations

which have been entered into by the United States

Government. Down through the years, through writ-

ten treaties and through formal and informal agree-

t has made specific commit-

life on government reser-

has agreed to

“This goal, of course, has never been achieved.

But the special relationship between the Indian

tribes and the Federal government which arises

from these agreements continues to carry immense

moral and legal force. To terminate this relation-

ship would be no more appropriate than to ter-

minate the citizenship rights of any other American.”

Some of the same reasoning applies to transfer of ju-

risdiction to the states without the consent of the tribes,

which amounts to partial termination of tribal self-

t, and which was possible under Public Law

280. until it was amended in 1968.

We recite all of this background to show the Court

what resistance Indians and others have made to the

a

11

extension of state jurisdiction over Indian reservations,

and the traditional explicitness with which Congress has

acted, when it has acted at all* It is totally incon-

sistent with this historical background and the cases to

permit Arizona’s taxing power to enter the Navajo

Reservation and attach to Indian income or property

there.

The termination acts, incidentally, support the as-

sumption that tribal members are -not subject to state

taxes prior to termination.“ For example, the Klamath

Termination Act, 25 U.S.C. § 564j, provides that after

property is distributed to the Indians,

“. .. Such property and any income derived there-

from by the individual . . . shall be subject to the

same taxes, State and Federal, as in the case of

non-Indians. .. .”

Other termination acts have similar provisions.“ Under

the Capoeman rationale, this would seem to imply tax

exemption for unterminated tribes.’*

18 For example, as noted in Appellant’s brief, p. 25, Congress has

aside from Public Law 280 authorized states to extend their taxing

power into federal areas, but Indians are exempted from this.

Buck Act, 4 U.S.C. §§ 105-109.

™ Even in the case of a terminated tribe, the tribe may retain

certain immunities from state law. See Menominee Tribe v. United

States, 391 U.S. 404 (1968). 3

%5 Mixed-Blood Ute Termination Act, 25 U.S.C. §677p; Western

Oregon Termination Act, 25 U.S.C. § 699; Paiute Termination Act,

25 U.S.C. § 749; Wyandotte Termination Act, 25 U.S.C. § 798;

Menominee Termination Act, 25 U.S.C. § 898; Ponca Termination

Act, 25 U.S.C. §978, and California Rancheria Termination Act,

72 Stat. 619, § 2(d).

- % See Squire v. Capoeman, 851 U.S. 1 (1956), where one of the

important reasons for the Court’s decision was the fact that the

1906 amendment to the General Allotment Act provided that upon

termination of the trust period, “all restrictions as to .. . taxation

of said land shall be removed .. . .” This Court said this implied that

re ee wrstination, the land was to be free of all tenes. 368

at p. 8.

12

Ill. Analysis of the Cases Relied on Below

The court below (Juris. St. p. 4a) relied on Leahy v.

State Treasurer of Oklahoma, 297 U.S. 420 (1936), as

upholding a state income tax on the headright income

of an Osage Indian. But that case involved an wn-

restricted Indian, who had received a certificate of com-

petency. ‘Therefore, under the applicable Osage statutes,

as earlier interpreted by this Court, Choteau V. Burnet,

288 U.S. 691 (1981) (and still good law), Leahy was

as subject to state income tax on his headright income

as a non-Indian. Had Leahy been a restricted Osage, his

headright income would not have been subject to federal

tax," and a fortiori not state tax either.

The court below (Juris. St. p. 4a) also relied on

Oklahoma Tax Commission v. United States, 319 U.S.

598 (1948), where this Court allowed a state death tax

on restricted Indian property. But that case does not

support the decision below, because that case did not

involve an Indian reservation. There the Indians owned

their land in fee, subject only to certain restrictions on

alienation. They lived in an Indian community, perhaps,

but the reservation had long since been abolished, and

the state had complete general jurisdiction over the area

where the Indians and their property were located. Ari-

zona, in contrast, does not have general jurisdiction over

the Navajo Reservation.

The court below (Juris. St. p. 5a) also relied on

Metlakatla Indians v. Egan, 369 U.S. 45 (1962), where

state fish trap laws were held to apply to Indians on a

reservation in Alaska. But that reservation was a highly

special one. Not only were these Indians immigrants

from Canada, but this Court noted that they had “very

substantially” adopted and been adopted by the white

11 Big Eagle V. United States, 300 F.2d 765 (Ct.Cl. 1962) : Black-

bird v. CIR, 88 F.2d 976 (10th Cir. 1930).

18

man’s civilization, and “were never in the hostile and

isolated position of many tribes in other states,” at pp.

50-51, and that “there was never an attempt in Alaska

to isolate Indians on reservations. Very few were ever

created, and the purpose of these, in contrast to many

in other states, was not to confine the Indians for the

protection of the white settlers but to safeguard the In-

dians against exploitation.” At p. 51. Previous cases

had applied Alaska territorial (not federal) laws to the

Metlakatla Reservation. At pp. 51-52. Public Law 280

applied there. At p. 56. The Reservation was further

unique in that the Secretary of the Interior was given

regulatory power over it. At p. 53. Because of this

latter power, and the uncertainty whether the Secretary

had exercised it so as to exempt the Indians from the

state fish trap law, the case was remanded.

We agree that the Metlakatla opinion supports the

application of state law to Indians on an Indian reserva-

tion. However, that opinion is self-distinguishing by its

emphasis on the uniqueness of that reservation and the -

de facto assimilation of the Indian residents. The prin-

ciple should not be extended to a reservation where the

18 We seriously question the accuracy of the implication that

reservations in the continental U.S. were for the protection of the

settlers. It is our understanding that protection of settlers was

not a common motive at all, especially not after the mid-1800’s.

We believe the common motive was to shrink the tribal jurisdiction

and make land available to the settlers. After 1887, with the

General Allotment Act, 24 Stat, 388, 25 U.S.C. §§ 331ff, Congress

began the long and generally unsuccessful effort to break up the

reservations and assimilate the Indians. This was finally abandoned

in 1984 with the Indian Reorganization Act, 48 Stat. 984, 25 U.S.C.

§§ 461ff, which laid the foundation for piecing the tattered reserva-

tions back together again and breathing new life into tribal gov-

ernments. As detailed in the preceding section, there was a flurry of

“termination” fever in the 1950s, but that did not take root, and

the present course of events today is strongly proceeding down the

path of tribal self-government and strengthening of the reserva-

tions and their governments.

14

Indian residents remain a distinct, self-governing com-

munity, and have not assimilated into the local white

society.

The court below also mentioned Kake Village v. Egan,

869 U.S. 60 (1962), a companion case to Metlakatla.

But as the court noted, there was no reservation in

Kake, and so the case is not helpful.

The lower court believed that the question was whether

the state income tax would infringe “on the right of the

Reservation Indians to make their own laws and be

ruled by them.” Jurisd. St. p. 4a, quoting Williams v.

Lee, 358 U.S. 217 (1959). Williams does say this, but

also said, more generally and more accurately, that

“Congress has also acted consistently upon the as-

sumption that the States have no power to regulate

the affairs of Indians on a reservation.” 358 U.S.

at 220. ’

We agree with Appellant that the test whether state

laws infringe on the right of Indian self-government

is a test that comes into force once it has been determined

that state laws apply at all to the Indians on a reserva-

tion, something which is not true of the Navajo Reser-

vation.

15

CONCLUSION

The State of Arizona can point to neither an act of

Congress nor a decision of this Court, nor of any federal

court, authorizing it to impose its general income taxes

on Indians residing within an Indian reservation. Con-

sequently, the Navajos residing on their reservation are

not subject to Arizona income taxes. The judgment below

should be reversed.

Respectfully submitted,

CHARLES A. Hopss

Counsel for Amicus Curiae,

National Congress of

American Indians, Inc.

1616 H Street, N. W.

Washington, D.C. 20006

WILKINSON, CRAGUN & BARKER

Of Counsel

July 21, 1972

INDEX

Page

“BTATEMENT OF THE CASE 1

SUMMARY OF ARGUMENT 6

ARGUMENT

I. EXPRESS CONGRESSIONAL

AUTHORIZATION NOT ESSENTIAL

FOR VALIDTY OF STATE ACTION 8

II. IMPOSITION OF ARIZONA IN-

COME TAX DOES NOT IMPAIR

ANY RIGHTS GRANTED OR RE-

SERVED BY FEDERAL LAW 15

“III. IMPOSITION OF ARIZONA IN-

COME TAXES DOES NOT INFRINGE

UPON INDIAN RIGHT OF SELF

GOVERNMENT 27

IV. INDIAN RESIDENTS OF NAVAJO

’ RESERVATION ARE SUBJECT TO

STATE INCOME TAX 30

Vs SOME RAMIFICATIONS OF

APPELLANT'S POSITION 35

CONCLUSION 41

CITATIONS

ses

Begay v. Sawtelle

53 Ariz. 304

88 P.2d 999 (1939)

Bradley v. Arizona Corp. Comm'n

60 Ariz. 508

141 P.2d 524 (1943)

Brown v. Bd: of Education

347 U.S. 483 .

74 S.Ct. 686

98 L.Ed. 873. (1954)

Commission of Internal

Revenue v. Walker

326 F.2d 261

(9th Cir. 1964)

Comm'r of Taxation v. Brun

147 N.W.2d 120 (Minn. 1970)

Denison v. State

34 Ariz. 144

268 P. 617 (1928)

Draper v. United States

164 u.s. 240

17 S.ct.Rptr 107 (1896)

Ghahate v. Bureau of Revenue

80 N.M. 98

P.2d 1002 (1969)

af

a7

38

29

33,529

36

le 3

19,23,32

-iii-

ses Page

“€raves v. New York

306 U.S. 466

59 S.ct. 595

83 L.Ed. 927 (1938) 28

Harrison v. Laveen

67 Ariz. 337

196 P.2d 456 (1948) 36

Holt v. Comm'r Int. Rev.

364 F.2d 38 (1966) 31

Kansas Indians

5 Wall. 737 (1866) | 12

Kennerly v. District Court

of Montana

440 U.S. 423

91 S.Ct. 480

27 L.Ed.2d 507 (1971) 9,25

Klahr v. Williams

339 F.Supp. 922 (1972) 36

Leahy v. State Treas'r

of Oklahoma

297 U.S. 420

56 S.Ct. 507

80 L.Ed. 771 (1936) 32,32

McClanahan v. State Tax Comm'n

14 Ariz.App. 452

484 P.2d 221 (1971) 5,6,34

New York v. Martin

326 U.S. 496

0 tea. 261 (1946) -

$2.

Oklahoma Tax Comm'n v.

United States

319 U.S. 598

87 L.Ed. 1612 (1943)

Organized Village of Kake v. Egan

369 U.S. 60

@2 S.Ct. 562

7 L.Ed.2d 573 (1962) 9,18,19, 23,24

Porter v. Hall

34 Ariz. 308, 321

271 P. 411 (1928)

Powless v. State Tax Comm'n

253 N.Y.Supp.2d 438 (1964)

Silas Mason Company v.

Tax Commission

302 U.S. 186

82 L.Ed. 187 (1937)

Sims v. United States

359 U.S. 108

79 S.ct. 641

3 L.Ed.2d 667 (1959)

Squire v. Capoeman

gol U.S. 1

76 S.ct. 611

100 L.Ed. 883 (1956)

-V~=

“State Bd. of Public Welfare

v. Ba. of Comm'rs

262 N.C. 475

137 S.E.2d 801 (1964) 37

State Tax Comm'n v. W. L. Barnes

178 N.Y.Supp.2d 932 (1958) 32

Surplus Trading Co. v. Cook

281 U.S. 647

50 S.Ct. 455 (1929) 19

_ United States v. McBratney

104 U.S. 621

26 L.Ed. 869 (1882) 12

Vermillion v. Spotted Elk

85 N.W.2d 432 (1957) 18, 23

Warren Trading Post v.

Arizona Tax Commission

380 U.S. 685

85 S.ct. 1242

14 L.Ed.2d 165 (1965) 13,26, 27

Williams v. Lee

358 U.S. 217

79 S.ct. 269

3 L.Ed.2d 251 (1959)