Title Examination on the Fort Berthold Reservation



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Title Examination on the Fort Berthold Reservation
Andrew Schill

Abadie & Schill, P.C



Origins of Federal Indian Law
Conquest by Law1

  • Arriving Europeans imported laws and customs that gained hegemony over native peoples resulting in their dispossession and relocation.

  • The most fundamental were those governing the ownership of land.


Doctrine of Discovery

  • The primary question was what rights did Europeans acquire and indigenous peoples lose upon the discovery of the New World?

  • According to Chief Justice John Marshall the answer was ownership of all discovered lands.


Johnson v. McIntosh (1823)

  • Challenge to the validity of Indian land transfers made before the revolution.

  • The government later acquired these lands by treaty and sold them to other parties which resulted in conflicting claims of ownership.

  • Daniel Webster argued for the validity of the earlier transfers from the tribes which were recognized as sovereigns by the English and French.


The Discovery Doctrine and Johnson vs. McIntosh

  • Discovery: converted the indigenous owners of discovered lands into mere tenants

  • The underlying title now belonged to the discovering sovereign.

  • Indigenous occupants were free to sell their “lease,” but only to the landlord and they were subject to eviction at anytime.

  • Almost two centuries later - This is still the law.


Federal - Tribal Treaty Relationship 1789-1871

  • Treaties conveniently provided the solution to the Founders’ two immediate concerns; Seeking peace and avoiding a costly Indian war with the frontier tribes.

  • This method in itself implied the legitimacy of the tribes as self-governing peoples.

  • Indian Removal Act of 1830


The Cherokee Cases

  • Cherokee Nation v. Georgia (1831)

  • Worcester v. Georgia (1832)

  • Both cases continue to shape the judicial analysis of disputes between tribal governments and state and federal governments.



Cherokee Nation v. Georgia (1831)

  • Georgia was attempting to execute laws aimed at destroying the Cherokees as a political society.

  • Marshall recognized that the government had plainly recognized the Cherokees Nation as a state but distinguished them from foreign nations.

  • They were deemed “domestic dependent nations” and their relationship to the United States resembled that of a “ward to his guardian.”

  • The Court ruled that it lacked jurisdiction.


Worcester v. Georgia (1832)

  • Georgia law required all whites living in Cherokee Indian Territory to obtain a state license.

  • Seven missionaries were arrested, convicted and sentenced to four years hard labor.

  • Worcester argued that the law was unconstitutional because states have no power or authority to pass laws concerning sovereign Indian nations.

  • Chief Justice Marshall reverses his earlier methodology and now holds that the relationship between Indian nations and the United States is that of nations.

  • The Cherokee nation was a “distinct community” with self-government “in which the laws of Georgia can have no force.”

  • Announces the doctrine that the national government, and not individual states, has plenary authority in Indian Affairs.


Allotment and Assimilation 1871 - 1928

1887 Dawes Act



  • Provided allotment of the reservations in severalty to individual tribal members as part of an official policy to destroy tribalism through a reduction in the treaty-guaranteed tribal land base.

  • Surplus lands were sold for non-Indian settlement.

  • The result was the loss of about two-thirds of all the Indians’ lands.

  • 160 acres to each family head.

  • 80 acres to each single person over 18 and orphans under 18.

  • 40 acres to each other single person under 18.

  • Fee patent to be issued to each allottee but to be held in trust for a period of 25 years.

  • Resulted in checkboard type ownership seen throughout the West.


Reorganization 1928 – 1945

  • Reformers believed that the tribe itself, organized as a self-governing community, was better suited to deal with the influences of the dominant society.

  • Tribal self-government was to be encouraged rather than discouraged.


Indian Reorganization Act (Wheeler-Howard) of 1834

  • Ended the policy of allotment.

  • Restraints on alienation without the approval of the Secretary of Interior.

  • Provided loans for economic development.

  • Majority of adult Indians on a reservation could vote against it.

  • 181 tribes accepted the act and 77 tribes rejected it.

  • Navajo’s rejected.

  • Mandan, Hidatsa and Arikara Tribes accepted.


Termination Period 1945 – 1961

  • The Hoover Commission issued a report in 1949 recommending complete integration into the population as tax paying citizens.

  • Congress passed individual termination acts which directed the Secretary of the Interior to develop a detailed termination plan for the tribe.

  • For smaller tribes land was usually appraised and sold to the highest bidder with proceeds going to the tribe.

  • This ended the trust relationship and allowed for state legislative and judicial jurisdiction to be enforced, thus effectively ending tribal sovereignty.


Self-Determination 1961 – Present

  • Ironically, termination galvanized Indian leadership nationally and had the opposite effect as desired by the termination period reformers.

  • Indian Child Welfare Act of 1978 (ICWA).

  • American Indian Religious Freedom Act of 1978.

  • Indian Mineral Development Act.


Fort Berthold Reservation

  • Three Affiliated Tribes

  • Mandan, Hidatsa and Arikara Tribes.

  • General Allotment Act of 1887 (Dawes Act) was intended to end the reservation system and assimilate individual Indians.

  • Reservation is approximately 988,000 acres. The Subsurface mineral ownership is roughly comprised of 230,000 acres owned by the Tribe, 373,000 acres owned by individuals in trust and 385,000 owned by non-Indians.

  • Alloted lands are held in Trust by the United States for the benefit of individual Indians and subject to restrictions against alienation or encumbrance without approval of the Secretary of the Interior. Subsequent acts have continued to extend the original 25 year restraint against alienation.

  • Very little past development of oil and gas prior to the horizontal drilling boom in the Bakken and Three Forks Formation.


Examination of Title to Indian Lands

Leasing of Individual Allottees

  • 1998 amendment to the Mineral Leasing Act of 1909 specific to the Fort Berthold Reservation only requires the consent of a majority of the undivided interest in the Indian land that is the subject of the mineral lease or agreement with Secretarial approval. (Public Law 105-188)(See Appendix) 2

  • Secretary may execute a mineral lease or agreement that affects individually owned Indian land on behalf of an Indian owner if owner is deceased and the heirs to, or devisees of, the interest of the deceased owner have not been determined or heirs, or devisees have been determined, but 1 or more of the heirs or devisees cannot be located.

  • 5 and 10 year leases.

  • Must have actual production to hold lease.

  • Initial leasing usually based on informational Title Status Reports, which are often not as accurate as the certified TSR’s prepared prior to drilling.

  • Possible lease failure if necessary acceptances are not obtained prior to approval by the Superintendent. Additionally, Lessees cannot rely upon Secretarial approval as an estoppel against practices or approvals which violate Federal regulations.3

  • Leases are subject to the regulations at 25 CFR Part 212, which deal with leasing procedures and requirements; diligence in operations and prevention of drainage; permits to drill; assignments of leases, overriding royalties and operating agreements; lease cancellation; unitization and communitization agreements and well spacing requirements; payment of rentals and royalties. In addition, these regulations incorporate by reference regulations found at 25 CFR, chapter II, subchapters A and C, relating to the royalty reporting, accounting and auditing functions of the Minerals Management Service (MMS).


Leasing under the Indian Mineral Development Act of 1982

  • Allows Tribes and individual allottees to negotiate non-standard leases with specific provisions.

  • Must be approved by the BIA


Sources of Federally Maintained Records

  • Bureau of Land Management Regional Land Office - Billings, Montana:

  • Basic historical records relating to title such as patents and master title plats.




  • Bureau of Indian Affairs Land Titles and Records Office (“LTRO”) - Aberdeen, South Dakota:

  • Designated by regulation as the office of record for all land records and title documents pertaining to all Indian lands while such lands remain in trust status.

  • Issue Title Status Reports (“TSR”).

  • These are the most important records to review; however, due to limited resources and increased demand, it has become difficult to schedule sufficient time to verify title. Examining attorneys are largely relying on title notes prepared by landman based on their examination of the Land Index for each tract, together with all relevant deeds, probate files and other documents listed in the Land Index, as located and retrieved by the employees of the LTRO. Copying of documents is prohibited.

  • A Land Index system upon which any review is based will often not provide the most current documents.




  • Bureau of Indian Affairs Area Office - New Town, North Dakota:

  • Primarily responsible for approving documents affecting title to lands within the jurisdiction of the agency. (Deeds, leases, modifications, right of ways)

  • Lease sale files and individual lease files.

  • Overriding royalty assignments must be filed with BIA Area Office (25 CFR § 211.52, 212.53)

  • Earl Silk – Superintendent


Additional Sources of Review

  • County Records

  • Mortgages, leases, ORRI’s, easements.

  • To take advantage of State recording statutes, BIA approved leases and assignments should be recorded in the county records. See, e.g. Bolack v. Underwood, 340 F.2d 816 (10th Cir. 1965)



Special Considerations on the Fort Berthold Reservation

  • Tribal Sovereignty - Indian tribes are generally immune from suit without their consent. Kiowa Tribe of Oklahoma v. Manufacturing Technologies, 523 U.S. 571 (1998)

  • Subject to Tribal Court Jurisdiction: Civil jurisdiction over non-Indian activities on the reservation presumptively lies initially in tribal court. Nat'l Farmers Union Ins. Cos. v. Crow Tribe of Indians, 471 U.S. 845 (1985); Iowa Mutual Ins. Co. v. La Plante, 107 S. Ct. 971 (1987). May be required to bring suit concerning those reservation activities first in tribal court, although there are exceptions to this jurisdictional primacy.

  • North Dakota Industrial Commission does not have regulatory authority, but is generally followed.

  • Memorandum of understanding has not yet been approved by the BLM.

  • Possible Oil & Gas division to be created with BIA.

  • Oil and Gas Severance Tax Agreement Between The Three Affiliated Tribes and the State of North Dakota dated January 13, 2010. (See Appendix)

  • Royalty/Production Reports - MMS regulations regarding Royalty Reports and Production Reports with respect to Indian lease production are governed by 25 C.F.R. §211.6 and 30 C.F.R. Part 210. Lessees must submit a completed Form MMS-2014 and are responsible for the correct recording and reporting of measurements.

  • Dispute as to the ownership of the Little Missouri riverbed. (See Appendix)


Division Order Issues

  • Royalty payments are made directly to the MMS and not individual Indian owners.

  • MMS regulations regarding Royalty Reports and Production Reports with respect to Indian lease production are governed by 25 C.F.R. §211.6, 25 C.F.R. §212.6 and 30 C.F.R. Chapter II, subchapters A and C. Lessees must submit a completed Form MMS-2014 and are responsible for the correct recording and reporting of measurements.



Oil and Gas Operations on the Fort Berthold Reservation4

Responsibilities of the various agencies
BIA

Maintain the ownership records

• Determine whether the action constitutes a significant environmental impact.

• Recommend the Approval for Permit to Drill (APD).

• Approve leases, assignments, ROWs, permits, etc.

• Cancel leases, assignments, ROWs, etc., for violation of terms.

• Conduct on-site inspections with BLM of well sites, access roads, pipelines, etc

• Distribute monies associated with leasing and ROWs.

• Approve downhole abandonment procedures in consultation with BLM and EPA

• Recommend approval of interim and final reclamation of disturbed area


BLM

  • Requires compliance with 43 CFR operational regulations, onshore orders, and other instructions

    • Issued the drilling permit (APD) and prescribes the types and frequency of form submittals required by the operators

    • Monitors all production activities and may require temporary shutdown of operations, plugging of wells and restoration of disturbed areas

    • Identifies drainage and due diligence issues, notifies BIA and makes recommendations for remedy

• Conducts production verification
Operator

• Submits Plan of Operation.

• Submits Application for Permission to Survey with landowner consents

• Responsible for Archeological and Cultural Requirements

• Submits Environmental Assessment using template provided

• Obtains appraisal for determination for “fair market value.”

• Requests on-site inspection through BLM/BIA

• Submits APD or Notice of Staking



APPENDIX

Oil and Gas Tax Agreement Between The Three Affiliated Tribes and the State of North Dakota dated January 13, 2010
The state’s oil and gas production tax must apply to all wells located within the Fort Berthold Reservation and is formalized in an Oil and Gas Tax Agreement Between The Three Affiliated Tribes and the State of North Dakota dated January 13, 2010 (“Agreement”). Pursuant to the Agreement the allocation of revenue from oil and gas production taxes on the Fort Berthold Reservation is:

  1. The total Tribal and State tax rate attributable to production and extraction of oil from Trust Lands must be eleven and one half percent (11.5%). The total Tribal and State tax rate attributable to production of gas from Trust Lands must be the rate provided in N.D.C.C. § 57-51-02.2.

  2. The total State tax rate attributable to production and extraction of oil from Non-Trust Lands must be eleven and one half percent (11.5%) subject to applicable exemption in N.D.C.C. chapters 57-51 and 57-51.1. The total State tax rate attributable to production of gas from Trust Lands must be the rate provided in N.D.C.C. § 57-51-02.2.

  3. Exemptions

  1. All exemption under the United States Constitution, North Dakota Constitution, or federal law, apply to oil and gas production and extraction from wells located within the exterior boundaries of the Fort Berthold Reservation.

  2. Oil and gas production and extraction from wells located on Trust Lands within the exterior boundaries of the Fort Berthold Reservation are entitled to all exemptions in N.D.C.C. chapters 57-51 and 57-51.1 except for those in subsections of N.D.C.C. § 57-51.1-03 (Supp. 2007)


Public Law 105-188
(2) EFFECT OF APPROVAL BY SECRETARY OF THE INTERIOR.

(A) IN GENERAL - The Secretary may approve any mineral lease or agreement that affects individually owned Indian land if –

(i) the owners of a majority of the undivided interest in the Indian land that is the subject of the mineral lease or agreement (including any interest covered by a lease or agreement executed by the Secretary under paragraph (3)) consents to the lease or agreement; and

(ii) the Secretary determines that approving the lease or agreement is in the best interest of the Indian owners of the Indian land.

(B) EFFECT OF APPROVAL – Upon the approval by the Secretary under subparagraph (A), the lease or agreement shall be binding, to the same extent as if all of the Indian owners of the Indian land involved had consented to the lease or agreement, upon –

(i) all owners of the undivided interest in the Indian land subject to the lease or agreement (including any interest owned by an Indian tribe); and

(ii) all other parties to the lease or agreement.

(3) EXECUTION OF LEASE OR AGREEMENT BY SECRETARY – The Secretary may execute a mineral lease or agreement that affects individually owned Indian land on behalf of an Indian owner if –



(A) that owner is deceased and the heirs to, or devisees of, the interest of the deceased owner have not been determined; or

(B) the heirs or devisees referred to in subparagraph (A) have been determined, but 1 or more of the heirs or devisees cannot be located.

P.L. 105-188, 112 Stat. 620, 25 USC 396 note.

Ownership of the Little Missouri Riverbed
At one time, portions of the Little Missouri River were entirely contained within the Fort Berthold Indian Reservation. By Executive Order dated July 13, 1880, the lands south of the Little Missouri River were restored to the public domain. The restored lands were described as follows in the July 13, 1880 Executive Order:

Beginning at a point where the northern 40-mile limit of the grant to the Northern Pacific Railroad intersects the present southeast boundary of the Forth Berthold Indian Reservation; thence westerly with the line of said 40-mile limit to its intersection with range line, between ranges 92 and 93 West of the 5th Principal Meridian; thence north along said range line to its intersections with the south bank of the Little Missouri River; thence northwesterly along and up to the south bank of said Little Missouri River, with the meanders thereof to its intersection with the range line between Ranges 96 and 97 West of the 5th Principal Meridian; thence westerly in a straight line to the southeast corner of the Fort Buford Military Reservation; thence west along the south boundary of said military reservation to the south bank of the Yellowstone River, the present northwest boundary of the Fort Berthold Indian Reservation; thence along the present boundary of the said reservation and the south bank of the Yellowstone River to the Powder River; thence up the Powder River to where the Little Powder River unites with it; thence northeasterly in a direct line to the point of beginning ...

The issue presented is whether the southern boundary of the diminished Fort Berthold Indian Reservation follows the 'south bank' of the Little Missouri River, as per a literal reading of the above language, or whether that boundary lies along the thread of the Little Missouri River. Solicitor’s Opinion M-28120 dated March 31, 1936 opines on the ownership of an island within the navigable waters of the Missouri River which was originally part of the Fort Berthold Reservation. The dispositive issue concerning the ownership of the island was based upon a determination of whether or not the island was included within the Reservation boundaries at the time of admission of North Dakota to statehood. The Solicitor concluded that the island was within the boundaries of the Fort Berthold Reservation as created prior to statehood and thus owned by the Tribe.

A Solicitor's Opinion dated January 17, 1969, Opinions of the Solicitor, Vol. 2, p. 2096, declared that the “West bank of the Colorado River as the exterior boundary of the Colorado River Indian Reservation must be interpreted as fixing the reservation boundary at the ordinary high water line on the West bank of the Colorado River as it existed on the date of the Executive Order."



In consideration of the above, it is our opinion that the southern boundary of the Fort Berthold Indian Reservation lies along the southern boundary of the Little Missouri River. However, pending a conclusive resolution of this dispute, any proceeds of production attributable to such lands should be held in suspense.

Useful Materials
Webster, Michael E., and Burns, Craig, “Examination of Title to Indian Lands,” Mineral Title Examination, Paper No. 19, (Rocky Mt. Min. L. Fdn. 2012)
Natural Resources Development on Indian Lands,” (Rocky Mt. Min. L. Fdn. 2011) Mineral Law Series 2011, Number 2
Mineral Development in Indian Country: The Evolution of Tribal Control over Mineral Resourecs, 29 Tulsa L.J. 541(1994)
Cohen’s Handbook of Federal Indian Law (2005 & Supp. 2010)

Biography
Andrew Schill is a shareholder of Abadie & Schill, PC, located in Durango, Colorado, and is admitted to practice law in Colorado, North Dakota, Nebraska and Oklahoma. He is a 2003 graduate of the University of Oklahoma College of Law where he was a member of the American Indian Law Review. He began practicing law at Pitchlynn & Associates, in Norman, Oklahoma, while focused on Federal Indian Law. His practice now focuses on preparation of acquisition, drilling and division order title opinions; Federal Indian Law; real property law and real estate transactions; civil litigation; representation of clients in acquisitions and divestment of oil and gas properties. A major emphasis of his practice is directed toward examining title and consulting clients on natural resource development on the Fort Berthold Reservation.

1 Lindsay G. Robertson, Conquest by Law: How the Discovery of America Dispossessed Indigenous Peoples of Their Land (2005)

2 In order to determine the oil and gas leasehold status of a tract of allotted Indian land within the Ft. Berthold Reservation, it is necessary to determine individual ownership of the allotted tract only insofar as is necessary to establish that a lease has been accepted by the owners of the requisite majority interest in the tract and that the lease has been approved by the Area Director.

3 As a general rule, leases which are not executed or approved in accordance with Federal Regulations are void. Unites States v. Labbitt, 334 F. Supp 665 (D.C. Mont., 1971)

4 Powerpoint presentation: Oil Development on the Fort Berthold Reservation (Marietta Short Bull –Realty Specialist Bureau of Indian Affairs Fort Berthold Agency)


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