MM&A Productions v. Yavapai-Apache Nation (CA2 1/16/14)

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A fairly typical cautionary tale about tribal sovereign immunity.

MM&A sued the tribe in Superior Court for breach of contract. The tribe moved to dismiss on grounds of sovereign immunity. The tribal official who signed the contract had also signed two written waivers, as had his predecessor. But the tribe’s Constitution says, as usual, that only the Tribal Council can waive immunity, and the Council’s Executive Secretary submitted an affidavit that she looked through the minutes and it had never done so. The trial court granted the tribe’s motion; MM&A appealed. The Court of Appeals affirms.

It first regurgitates Indian immunity law for several pages while saying nothing new or helpful. That law is quite strict and always comes as a shock to those who haven’t studied it carefully before trying to make money dealing with the tribes – i.e., just about everybody. MM&A tried to argue apparent authority. But only actual authority is good enough; “misrepresentation by [the] tribe’s officials or employees ‘cannot effect its immunity from suit,’” nor do “’the equities of a given situation.’” MM&A did have a case from the Colorado Court of Appeals allowing apparent authority but this opinion rejects it as “contrary to the weight of controlling law.”

MM&A argued that it should at least get discovery on whether the tribal officer had actual authority; he had allegedly been told by a Council member that it knew of the waiver and approved of it. But the tribe’s affidavits said that the various bureaucratic procedures necessary to waive sovereign immunity had never been done for this contract, so the court figures that further evidence couldn’t make any difference.

This case does at least show you what you need. If you want to be able to sue an Indian tribe then you have to make sure that every detail of the waiver process is carried through by the book and documented by the tribe in the tribe’s records. You can’t rely on what anyone says, regardless of how many officials sign on how many dotted lines. The rules you’re used to just don’t apply. If there’s any doubt, contact the tribe’s lawyer – who will be involved with the process anyway – and make sure you understand the details.

The alternative, of course, is to sue the tribe in tribal court. Some of those are well-appointed and the judges are trained and interested. Others are held (we speak from experience) in double-wide trailers and the judge is an elderly lady with no schooling who barely speaks English and whose principal function is to chastise wayward Indian children. But since a principal tenet of all Indian law is that it must be construed so as to benefit Indians, your chances may be as good in one as in the other.

(For procedure junkies, the court considered matters outside the pleadings but didn’t have to convert the Rule 12 motion to a Rule 56. The opinion notes that that needn’t be done when the question considered is the court’s  jurisdiction and the facts considered are not “intertwined” with the merits of the case.)

(link to opinion)

BMO Harris Bank v. Wildwood Creek Ranch (CA1 1/21/14)

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NOTE: THIS OPINION HAS BEEN VACATED

This short and otherwise-routine (though not unimportant) case treats us to a “special concurrence.”

Defendants defaulted on a loan secured by some property. The bank took the property and then sued them for the deficiency. You can’t get a deficiency against property used for a single-family dwelling (33-814). The property was and had always been empty but the Defendants argued that they had intended to build their home on it. The trial court bought that argument and gave them summary judgment.

The Court of Appeals reverses. “In looking at the plain language of the statute, we conclude the protection for “dwellings” under A.R.S. § 33-814(G) does not apply to vacant land.”

Seems simple enough and only takes 4 1/2 pages even with the usual, boilerplate, needless standard-of-review paragraph (that our courts have long since decided is a required element of every opinion).

But one judge has thought of a question. He agrees that the statute doesn’t apply to a vacant lot. But the court ruled in an earlier case (Marshall & Ilsley 2011) that  if you start to build but don’t finish the house, the statute applies if you intended to use it as your dwelling. In that case the house was apparently pretty much complete. So if you start, how far along do you have to get before the court can analyze your intentions?

Once upon a time, this would have been dealt with – if at all, and only had it been a subject of discussion by the parties – by noting that the court would address the issue should some future case present it. This one certainly didn’t. But instead we get five pages “specially concurring.”

What’s a “special concurrence,” you ask, as opposed to a mere “concurrence”? Don’t worry about it; the court didn’t.

And what does it say? Of course its pure dicta – its whole purpose is to inject into the discussion an issue not raised by the case at hand — so as a legal matter it means nothing. Maybe that’s what makes it “special.”

But beyond that it says that the point at which you judge the borrower’s intent is a question of the borrower’s intent, measured by “a totality of the circumstances.” Otherwise it would be a “blurry and artificial line.”

Yes.

But our point is not to parody gibberish. The problem here is that the court has created an opportunity, which this case did not genuinely present, to write an opinion furthering someone’s agenda. Some banking and real-estate practitioners have been critical of Marshall & Ilsley; whether they are right or wrong, this is an active issue in those quarters. The “special concurrence” is a brief – an argument  presented by a partisan (meaning no disrespect, but a judge isn’t acting as a judge when there’s nothing before him to judge; making up things to take sides on isn’t judging them) – arguing that that case is right and should be extended. That’s not a proper, seemly, or appropriate concurrence.

Maybe that, too, is what makes it “special.”

(Later note: We originally blogged this on January 16; when the court issued it. Today, the 21st, it issues it again, without explanation or comment, with today’s date. The only difference we spot is that the new version corrects mistakes in paragraph numbering. Burying mistakes rather than explaining them is now this court’s standard practice.)

(link to opinion)

Estate of DeCamacho v. La Solana (CA2 1/14/14)

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The court holds that a wrongful-death claim is not subject to an arbitration agreement signed by the decedent.

Mrs. DeCamacho died in a nursing home. Her estate and beneficiaries sued it. But the admission documents contained an arbitration agreement. The trial court ordered arbitration; the estate appealed.

It first made some arguments about the validity of the contract that are mostly too silly to bother with (e.g., it wasn’t valid because when it was signed somebody forgot to fill in the date). Presumably the estate knew these were throw-aways (though in that case it should have thrown them away before wasting appeal time and money on them).

The arbitration agreement applied, according to the court, to claims that “originate from the rights of DeCamacho.” The estate argued that its wrongful-death and APSA claims didn’t.

As to the APSA it loses. “The estate’s right to recovery under APSA is protected only if ‘the incapacitated or vulnerable adult could have brought the claim had he or she been alive.’” The claim is therefore derivative of the vulnerable adult’s.

Wrongful-death claims, however, are not derivative (because our Supreme Court once said so in passing – Huebner (1973), which this opinion cites – though it apparently has never really analyzed the question). La Solana argued that since under 12-211 a wrongful-death claim can’t be brought unless the decedent would have had a claim, it is subject to arbitration if the decedent’s claim would have been. If that sounds like the APSA analysis to you, it doesn’t to the court. The court says that the statute’s language “is merely descriptive of the nature of the wrong.” The nursing home also contended that the beneficiaries of the estate were third-party beneficiaries of the admission contract. The court holds that they are not because they are not seeking benefits under it (unlike the case that La Solana cited, which involved beneficiaries to an insurance contract). So the arbitration agreement does not apply to wrongful death.

The court then spends some time saying that other jurisdictions have come to the same conclusion. As usual, this is pointless. If the agreement covers only derivative clams, and if the wrongful-death claim isn’t derivative, how can what other courts say make any slightest difference? If you’re making a judgment call then the opinions of others can help. But if you’ve decided that the task is to add two and two then you shouldn’t need a consensus. Whether that really was this court’s task we’ll leave to you.

(Link to opinion)