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Because the timber management statutes, 25 U.S.C.S. § 406, 407, 466, and the regulations promulgated thereunder, 25 C.F.R. § 163 (1983), clearly establish fiduciary obligations of the Government in the management and operation of Indian lands and resources, they can fairly be interpreted as mandating compensation by the Federal Government for damages sustained.
Respondents, individuals owning interests in allotments of land, and the Quinault Indian Tribe, which also held some of the allotments, filed suit in the United States Court of Claims, seeking damages from the United States for its alleged mismanagement of timberlands on the Quinault Indian Reservation. Acting on a motion to dismiss by the United States, the Court of Claims held that the United States was subject to suit for money damages on most of the claims. The court ruled that the federal timber management statutes (25 USCS 406, 407, and 466), various federal statutes governing road building and rights of way (25 USCS 318a, 323-325), statutes governing Indian funds management and government fees (25 USCS 162a, 413), and the regulations promulgated under these statutes, imposed fiduciary duties on the United States in its management of forested allotted lands, the court concluding that the statutes and regulations implicitly required compensation for damages sustained as a result of the government's breach of its duties.
Was petitioner United States accountable in money damages for alleged breaches of trust in connection with its management of forest resources on Native American reservations?
The Court held that the United States was accountable in money damages for alleged breaches of trust in connection with its management of forest resources on the allotted lands, since the statutes and regulations relied upon by the Court of Appeals clearly give the Federal Government full responsibility to manage Indian resources and land for the benefit of Indians, and therefore establish fiduciary obligations of the government in the management and operation of Indian lands and resources, and thus can be fairly interpreted as mandating compensation by the Federal Government for damages sustained by the breach of its fiduciary duties.