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Poafpybitty v. Skelly Oil Co.

Supreme Court of the United States

January 24, 1968, Argued ; March 18, 1968, Decided

No. 65

Opinion

 [*366]  [***1241]  [**982]    MR. CHIEF JUSTICE WARREN delivered the opinion of the Court.

 

The question presented is whether petitioners, who are Comanche  [****4]  Indians, have standing to sue under an oil  [**983]  and gas lease approved by the Department of the Interior for use on land held by Indians under trust patents issued by the United States.

In 1947 the Acting Commissioner of Indian Affairs approved an oil and gas lease which petitioners had executed to respondent, Skelly Oil Company, on the form prescribed by the Department of the Interior. The first well was drilled in 1956, and seven producing wells were soon completed. In 1961 petitioners retained counsel  [*367]  with the approval of the Department of the Interior 1 [****6]  and brought this damage action against respondent in the District Court of Oklahoma County, Oklahoma, alleging that respondent had breached the express and implied covenants in the lease and had thereby impaired petitioners' royalties. Respondent notified the Department of the Interior and the Bureau of Indian Affairs of the litigation, but the Government made no attempt to intervene in the proceedings. The petition filed in the District Court asserted that respondent had permitted natural gas being produced from the wells to escape despite the fact that there was a pipeline less than a mile from the land. 2 [****5]  Petitioners claimed that respondent ignored their request that the gas be marketed and continued to allow the gas to be wasted in violation of the terms of the lease. 3 The District Court sustained respondent's  [*368]  demurrer and dismissed the petition. The Supreme Court of Oklahoma affirmed on the ground  [***1242]  that petitioners were precluded from suing by the provisions of the lease and by the regulations promulgated by the Secretary of the Interior to control oil and gas leases on restricted Indian land. 4 We granted certiorari, 389 U.S. 814 (1967), to determine whether the federal restrictions imposed on the Indians prevented them from vindicating their rights. In our view, the decision below unduly restricts the right of the Indians to seek judicial relief for a claimed injury to their interests under the oil and gas lease.

 [****7]   The trust patents to the land in question were issued to petitioners under ] the General Allotment Act of 1887, 24 Stat. 388, as amended, 25 U. S. C. §§ 331-358, which provided that individual  [**984]  Indians were to be allotted land on their reservations 5 [****10]  and that the United States was to hold the land "in trust for the sole use and benefit of the Indian" allottees for a 25-year period. 25 U. S. C. § 348. During the trust period, which has been repeatedly extended, 6 restricted Indian land may be sold or leased only with the consent of the Secretary of the Interior.  In our view, these restrictions on the Indian's control of his land are mere incidents of the promises  [*369]  made by the United States in various treaties to protect Indian land and have no effect on the Indian's capacity to institute the court action necessary to protect his property. ] In order to fulfill these national promises to safeguard Indian land and at the same time "to prepare the Indians to take their place as independent, qualified members of the modern body politic," Board of County Comm'rs v. Seber, 318 U.S. 705, 715 (1943), the allotment system was created with the Indians [****8]  receiving ownership rights in the land while the United States retained the power to scrutinize the various transactions by which the Indian might be separated from that property.   Squire v. Capoeman, 351 U.S. 1, 9 (1956). See, e. g., 18 Cong. Rec. 190-192 (1886). This dual purpose of the allotment system would be frustrated unless both the Indian and the United States were empowered to seek judicial relief to protect the allotment. The obligation and power of the United States to institute such litigation to aid the Indian in the protection of his rights in his allotment were recognized in United States v. Rickert, 188 U.S. 432 (1903); Heckman v. United States, 224 U.S. 413 (1912); and United States v. Candelaria, 271 U.S. 432 (1926). See generally Federal Indian Law 326-341 (Dept. of Interior, 1958).  In Heckman, an action brought by the United States to set aside an improper conveyance of restricted land, this Court realized that the allotment system created interests in both the Indian and the United States. 7 "A transfer of the allotments is not simply a violation  [***1243]   [****9]  of the proprietary rights of the Indian. It violates the governmental rights of the United States." 224 U.S., at 438.  [*370]  In holding that the United States could sue to protect the allotment, the Court indicated that the Government could either bring the necessary suit itself or allow the litigation to be prosecuted by the Indian.

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390 U.S. 365 *; 88 S. Ct. 982 **; 19 L. Ed. 2d 1238 ***; 1968 U.S. LEXIS 2924 ****; 42 Oil & Gas Rep. 55

POAFPYBITTY ET AL. v. SKELLY OIL CO.

Prior History:  [****1]  CERTIORARI TO THE SUPREME COURT OF OKLAHOMA.

Disposition: Reversed and remanded.

CORE TERMS

lease, allotment, lessee, oil, lessor, cancel, allottees, tribes

Governments, Native Americans, Indian General Allotment Act, Real Property Law, Trusts, Holding Trusts, Civil Procedure, Parties, Capacity of Parties, General Overview, Property Rights, Authority & Jurisdiction, Deeds, Remedies, Rescission, Appeals, Case Transfers, Indian Reorganization Act, Judgments, Preclusion of Judgments, Res Judicata, Intervention, Intervention of Right, Courts, Courts of Claims, Federal Government, Claims By & Against, Indian Claims Commission Act, Contracts Law, Types of Contracts, Lease Agreements, Energy & Utilities Law, Mining Industry, Mineral Leases, Federal Oil & Gas Leases, Lease Terms, Bonds, Native American Interests, Royalties, Torts, Business & Corporate Compliance, Energy & Utilities Law, Records & Reports, Local & State Regulation, Waste Prevention, Encumbrances, Adjoining Landowners, Oil & Gas, Breach, Leasehold Royalty Clauses, Extensions & Terminations, Leases & Licenses, Extensions & Terminations, Lease Cancellation, Damages