SOTOMAYOR, J., DISSENTING
UNITED STATES V. JICARILLA APACHE NATION
564 U. S. ____ (2011)
SUPREME COURT OF THE UNITED STATES
NO. 10-382
UNITED STATES, PETITIONER
v. JICARILLA
APACHE NATION
on writ of certiorari to the united states court of
appeals for the federal circuit
[June 13, 2011]
Justice Sotomayor,
dissenting.
Federal Indian policy, as
established by a network of federal statutes, requires the United
States to act strictly in a fiduciary capacity when managing Indian
trust fund accounts. The interests of the Federal Government as
trustee and the Jicarilla Apache Nation (Nation) as beneficiary are
thus entirely aligned in the context of Indian trust fund
management. Where, as here, the governing statutory scheme
establishes a conventional fiduciary relationship, the Government’s
duties include fiduciary obligations derived from common-law trust
principles. Because the common-law rationales for the fiduciary
exception fully support its application in this context, I would
hold that the Government may not rely on the attorney-client
privilege to withhold from the Nation communications between the
Government and its attorneys relating to trust fund management.
The Court’s decision to the contrary rests on
false factual and legal premises and deprives the Nation and other
Indian tribes of highly relevant evidence in scores of pending
cases seeking relief for the Government’s alleged mismanagement of
their trust funds. But perhaps more troubling is the majority’s
disregard of our settled precedent that looks to common-law trust
principles to define the scope of the Government’s fiduciary
obligations to Indian tribes. Indeed, aspects of the majority’s
opinion suggest that common-law principles have little or no
re-levance in the Indian trust context, a position this Court
rejected long ago. Although today’s holding pertains only to a
narrow evidentiary issue, I fear the upshot of the majority’s
opinion may well be a further dilution of the Government’s
fiduciary obligations that will have broader negative repercussions
for the relationship between the United States and Indian
tribes.
I
A
Federal Rule of Evidence 501
provides in relevant part that “the privilege of a … government …
shall be governed by the principles of the common law as they may
be interpreted by the courts of the United States in the light of
reason and experience.” Rule 501 “was adopted precisely because
Congress wished to leave privilege questions to the courts rather
than attempt to codify them.”
United States v.
Weber
Aircraft Corp.,
465 U. S. 792, 804, n.
25 (1984).
As the majority notes, the
purpose of the attorney-client privilege “is to encourage full and
frank communication between attorneys and their clients and thereby
promote broader public interests in the observance of law and
administration of justice.”
Upjohn Co. v.
United
States,
449 U.
S. 383, 389 (1981). But the majority neglects to explain that
the privilege is a limited exception to the usual rules of evidence
requiring full disclosure of relevant information. See 8 J.
Wigmore, Evidence §2192, p. 64 (3d ed. 1940) (common law
recognizes “fundamental maxim that the public … has a right to
every man’s evidence” and that “any exemptions which may exist are
distinctly exceptional, being so many derogations from a positive
general rule”). Because it “has the effect of withholding relevant
information from the factfinder,” courts construe the privilege
narrowly.
Fisher v.
United States,
425 U. S. 391, 403
(1976). It applies “only where necessary to achieve its purpose,”
ibid.; “[w]here this purpose ends, so too does the
protection of the privilege,”
Wachtel v.
Health Net,
Inc., 482 F. 3d 225, 231 (CA3 2007).
The fiduciary exception to the attorney-client
privilege has its roots in 19th-century English common-law cases
holding that, “when a trustee obtained legal advice relating to his
administration of the trust, and not in antici-pation of
adversarial legal proceedings against him, the beneficiaries of the
trust had the right to the production of that advice.”
Ibid. (collecting cases). The fiduciary exception is now
well recognized in the jurisprudence of both federal and state
courts,[
Footnote 1] and has
been applied in a wide variety of contexts, including in litigation
involving common-law trusts, see,
e.g.,
Riggs Nat.
Bank of Washington, D. C. v.
Zimmer, 355
A. 2d 709 (Del. Ch. 1976), disputes between corporations and
shareholders, see,
e.g.,
Garner v.
Wolfinbarger, 430 F. 2d 1093 (CA5 1970), and ERISA
enforcement actions, see,
e.g.,
United States v.
Doe, 162 F. 3d 554 (CA9 1999).
The majority correctly identifies the two
rationales courts have articulated for applying the fiduciary
exception,
ante, at 8–9, but its description of those
rationales omits a number of important points. With regard to the
first rationale, courts have characterized the trust beneficiary as
the “real client” of legal advice relating to trust administration
because such advice, provided to a trustee to assist in his
management of the trust, is ultimately for the benefit of the trust
beneficiary, rather than for the trustee in his personal capacity.
See,
e.g.,
United States v.
Mett, 178
F. 3d 1058, 1063 (CA9 1999) (“ ‘[A]s a representative for
the beneficiaries of the trust which he is administering, the
trustee is not the real client in the sense that he is personally
being served’ ” (quoting
United States v.
Evans, 796 F. 2d 264, 266 (CA9 1986)
(per
curiam)));
Riggs, 355 A. 2d, at 713 (same). The
majority places heavy emphasis on the source of payment for the
legal advice, see
ante, at 8, 15, but it is well settled
that who pays for the legal advice, although “potentially
relevant,” “is not determinative in resolving issues of privilege.”
Restatement (Third) of Trusts §82, Comment
f, p. 188
(2005) (hereinafter Third Restatement). Instead, the lynchpin of
the “real client” inquiry is the identity of the ultimate
beneficiary of the legal advice. See
Wachtel, 482
F. 3d, at 232 (“[O]f central importance … [i]s the fiduciary’s
lack of a legitimate personal interest in the legal advice
obtained”). If the advice was rendered for the benefit of the
beneficiary and not for the trustee in any personal capacity, the
“real client” of the advice is the beneficiary.
As to the second rationale for the fiduciary
exception—rooted in the trustee’s fiduciary duty to disclose all
information related to trust management—the majority glosses over
the fact that this duty of disclosure is designed “to enable the
beneficiary to prevent or redress a breach of trust and otherwise
to enforce his or her rights under the trust.” Third Restatement
§82, Comment
a(2), at 184. As the leading American case on
the fiduciary exception explains, “[i]n order for the beneficiaries
to hold the trustee to the proper standards of care and honesty and
procure for themselves the benefits to which they are entitled,
their knowledge of the affairs and mechanics of the trust
management is crucial.”
Riggs, 355 A. 2d, at 712.
Courts justifying the fiduciary exception under this rationale have
thus concluded that “[t]he policy of preserving the full disclosure
necessary in the trustee-beneficiary relationship is … ultimately
more important than the pro-tection of the trustees’ confidence in
the attorney for the trust.”
Id., at 714; see
Mett, 178 F. 3d, at 1063 (under this rationale, “the
fiduciary exception can be understood as an instance of the
attorney-client privilege giving way in the face of a competing
legal principle”). The majority fails to appreciate the important
oversight and accountability interests that underlie this rationale
for the fiduciary ex-ception, or explain why they operate with any
less force in the Indian trust context.
B
The question in this case is
whether the fiduciary exception applies in the Indian trust context
such that the Government may not rely on the attorney-client
privilege to withhold from the Nation communications between the
Government and its attorneys relating to the administration of the
Nation’s trust fund accounts. Answering that question requires a
proper understanding of the nature of the Government’s trust
relationship with Indian tribes, particularly with regard to its
management of Indian trust funds.
Since 1831, this Court has
recognized the existence of a general trust relationship between
the United States and Indian tribes. See
Cherokee Nation
v.
Georgia, 5 Pet. 1, 17 (1831) (Marshall, C. J.).
Our decisions over the past century have repeatedly reaffirmed this
“distinctive obligation of trust incumbent upon the Government” in
its dealings with Indians.
Seminole Nation v.
United
States,
316 U.
S. 286, 296 (1942); see
United States v.
Mitchell,
463 U. S. 206, 225–226
(1983)
(Mitchell II) (collecting cases and noting “the
undisputed existence of a general trust relationship between the
United States and the Indian people”). Congress, too, has
recognized the general trust relationship between the United States
and Indian tribes. Indeed, “[n]early every piece of modern
legislation dealing with Indian tribes contains a statement
reaffirming the trust relationship between tribes and the federal
government.” F. Cohen, Handbook of Federal Indian Law §5.04[4][a],
pp. 420–421 (2005 ed.) (hereinafter Cohen).[
Footnote 2]
Against this backdrop, Congress has enacted
federal statutes that “define the contours of the United States’
fiduciary responsibilities” with regard to its management of Indian
tribal property and other trust assets.
Mitchell II, 463
U. S., at 224. The Nation’s claims as relevant in this case concern
the Government’s alleged mismanagement of its tribal trust fund
accounts. See
ante, at 3.
The system of trusteeship and federal
management of Indian funds originated with congressional enactments
in the 19th century directing the Government to hold and manage
Indian tribal funds in trust. See,
e.g., Act of June 9,
1837, 5 Stat. 135; see also Misplaced Trust: The Bureau of Indian
Affairs’ Mismanagement of the Indian Trust Fund, H. R. Rep.
No. 102–449, p. 6 (1992) (hereinafter Misplaced Trust).
Through these and later congressional enactments, the United States
has come to manage almost $3 billion in tribal funds and collects
close to $380 million per year on behalf of tribes. Cohen
§5.03[3][b], at 407.[
Footnote
3]
Today, numerous statutes outline the Federal
Government’s obligations as trustee in managing Indian trust funds.
In particular, the Secretary of the Treasury, at the request of the
Secretary of the Interior, must invest “[a]ll funds held in trust
by the United States … to the credit of Indian tribes” in certain
securities “suitable to the needs of the fund involved.” 25 U.
S. C. §161a(a). The Secretary of the Interior may deposit in
the Treasury and pay mandatory interest on Indian trust funds when
“the best interests of the Indians will be promoted by such
deposits, in lieu of investments.” §161. Similarly, the Secretary
of the Interior may invest tribal trust funds in certain public
debt instruments “if he deems it advisable and for the best
interest of the Indians.” §162a(a). And Congress has set forth a
nonexhaustive list of the Secretary of the Interior’s “trust
responsibilities” with respect to Indian trust funds, which include
a series of accounting, auditing, management, and disclosure
obligations. §162a(d). These and other statutory
provisions[
Footnote 4] give the
United States “full responsibility to manage Indian [trust fund
accounts] for the benefit of the Indians.”
Mitchell II,
463 U. S., at 224.
“[A] fiduciary relationship necessarily arises
when the Government assumes such elaborate control over [trust
assets] belonging to Indians.”
Id., at 225. Under the
statutory regime described above, the Government has extensive
managerial control over Indian trust funds, exercises considerable
discretion with respect to their in-vestment, and has assumed
significant responsibilities to account to the tribal
beneficiaries. As a result, “[a]ll of the necessary elements of a
common-law trust are present: a trustee (the United States), a
beneficiary (the Indian [Tribe]), and a trust corpus (Indian …
funds).”
Ibid. Unlike in other contexts where the
statutory scheme creates only a “bare trust” entailing only limited
responsibilities,
United States v.
Navajo Nation,
537 U. S. 488,
505 (2003)
(Navajo I) (internal quotation marks
omitted),[
Footnote 5] the
statutory regime governing the United States’ obligations with
regard to Indian trust funds “bears the hallmarks of a conventional
fiduciary relationship,”
United States v.
Navajo
Nation, 556 U. S. ___, ___ (2009) (
Navajo II )
(slip op., at 14) (internal quotation marks omitted); see
Lincoln v.
Vigil,
508 U. S. 182, 194
(1993) (“[T]he law is ‘well established that the Government in its
dealings with Indian tribal property acts in a fiduciary
capacity’ ” (quoting
United States v.
Cherokee
Nation of Okla.,
480 U. S. 700, 707
(1987)).
II
In light of Federal Rule of
Evidence 501 and the Government’s role as a conventional fiduciary
in managing Indian trust fund accounts, I would hold as a matter of
federal common law that the fiduciary exception is applicable in
the Indian trust context, and thus the Government may not rely on
the attorney-client privilege to withhold communications related to
trust management. As explained below, the twin rationales for the
fiduciary exception fully support its application in this context.
The majority’s conclusion to the contrary rests on flawed factual
and legal premises.
A
When the Government seeks legal
advice from a government attorney on matters relating to the
management of the Nation’s trust funds, the “real client” of that
advice for purposes of the fiduciary exception is the Nation, not
the Government. The majority’s rejection of that conclusion is
premised on its erroneous view that the Government, in managing the
Nation’s trust funds, “has its own independent interest in the
implementation of federal Indian policy” that diverges from the
interest of the Nation as beneficiary.
Ante, at 18; see
also
ante, at 1 (Ginsburg, J., concurring in
judgment).
The majority correctly notes
that, as a general matter, the Government has sovereign interests
in managing Indian trusts that distinguish it from a private
trustee. See,
e.g.,
United States v.
Minnesota,
270 U. S. 181, 194
(1926). Throughout the history of the Federal Government’s dealings
with Indian tribes, Congress has altered and administered the trust
relationship “as an instrument of federal policy.”
Ante,
at 17, n. 8 (detailing shifts in policy); see generally
Cobell v.
Norton, 240 F. 3d 1081, 1086–1088
(CADC 2001) (same, and describing that history as “contentious and
tragic”).
In the specific context of Indian trust fund
management, however, federal Indian policy entirely aligns the
interests of the Government as trustee and the Indian tribe as
beneficiary. As explained above, Congress has enacted an extensive
network of statutes regulating the Government’s management of
Indian trust fund accounts. That statutory framework establishes a
“conventional fiduciary re-lationship” in the context of Indian
trust fund admini-stration.
Navajo Nation II, 556 U. S.,
at ___ (slip op., at 14) (internal quotation marks omitted); see
supra, at 7–9.
As a conventional fiduciary, the Government’s
management of Indian trust funds must “be judged by the most
exacting fiduciary standards.”
Seminole Nation, 316 U. S.,
at 296–297. Among the most fundamental fiduciary obligations of a
trustee is “to administer the trust solely in the interest of the
beneficiaries.” 2A A. Scott & W. Fratcher, Law of Trusts §170,
p. 311 (4th ed. 1987); see
Meinhard v.
Salmon,
249 N. Y. 458, 464, 164 N. E. 545, 546 (1928) (Cardozo,
C. J.) (“Not honesty alone, but the punctilio of an honor the
most sensitive,” is “the standard of behavior” for trustees “bound
by fiduciary ties”). Although Indian trust funds are deposited in
the United States Treasury, “they are not part of the federal
government’s general funds and can be used only for the benefit of
the tribe.” Cohen §5.03[3][b], at 408, and n. 140 (citing
Quick Bear v.
Leupp,
210 U. S. 50, 80–81
(1908)).
Because federal Indian policy requires the
Government to act strictly as a conventional fiduciary in managing
the Nation’s trust funds, the Government acts in a “representative”
rather than “persona[l]” capacity when managing the Nation’s trust
funds.
Riggs, 355 A. 2d, at 713. By law, the
Government cannot pursue any “independent” interest,
ante,
at 18, distinct from its responsibilities as a fiduciary. See Cohen
§5.03[3][b], at 408, and n. 141 (“Federal statutes forbid use of
Indian tribal funds in any man- ner not authorized by treaty or
express provisions of law” (citing 25 U. S. C. §§122, 123)).
In other words, any uniquely sovereign interest the Government may
have in other contexts of its trust relationship with Indian tribes
does not exist in the specific context of Indian trust fund
administration. It naturally follows, then, that when the
Government seeks legal advice from government attorneys relating to
the management of the Nation’s trust funds, the “real client” of
the advice for purposes of the fiduciary exception is the Nation,
not the Government.
This conclusion holds true even though
government attorneys are “paid out of congressional appropriations
at no cost to the [Nation].”
Ante, at 15. As noted above,
although the source of funding for legal advice may be relevant,
the ultimate inquiry is for whose benefit the legal advice was
rendered. See
supra, at 4. And, for all the emphasis the
majority places on the funding source here, see
ante, at
8, 15, the majority never suggests that the fiduciary exception
would apply if Congress amended federal law to permit Indian tribes
to pay government attorneys out of their own trust funds.[
Footnote 6]
The majority also suggests that, even if the
interests of the United States and Indian tribes may be equivalent
in some contexts, that “equivalence” “breaks down” when there are
“multiple interests” involved in a trust relationship.
Ante, at 18. According to the majority, “the Government
has too many competing legal concerns to allow a case-by-case
inquiry into the purpose of each communication.”
Ibid. As
a result, the majority concludes that the fiduciary exception
should not be applied at all in the Indian trust context.
Ibid.
Preliminarily, while the Government in certain
circumstances may have sovereign obligations that conflict with its
duties as a fiduciary for Indian tribes, see,
e.g.,
Nevada v.
United States,
463 U. S. 110
(1983),[
Footnote 7] the
existence of competing interests is not unique to the Government as
trustee. Indeed, the issue of competing interests arises frequently
in the private trust context. See,
e.g., Third Restatement
§78, Comment
c, at 97–103 (describing duties of trustee
with respect to “transactions that involve conflicting fiduciary
and personal interests”);
id., §79, Comment
b, at
128–129 (describing trustee’s duty of impartiality in “balancing …
competing interests” of multiple beneficiaries). In such
circumstances, “a trustee—and ultimately a court—may need to
provide some response that offers a compromise between the
confidentiality or privacy concerns of some and the
interest-protection needs of others.”
Id., §82, Comment
f, at 188. The majority provides no reason why federal
courts applying the fiduciary exception in the Indian trust context
could not similarly adopt a workable framework that adequately
takes into account any unique governmental interests that bear on
the application of the fiduciary exception in any given
circumstance. See Fed. Rule Civ. Proc. 26(b)(2)(C) (authorizing
courts to set limits on discovery based on equitable concerns).
The majority’s categorical rejection of the
fiduciary exception in the Indian trust context sweeps far broader
than necessary. This case involves only the Government’s alleged
mismanagement of the Nation’s trust fund accounts, and the
Government did not claim below that the attorney-client
communications at issue relate to any competing governmental
obligations. See App. to Pet. for Cert. 18a–19a. To the extent the
United States in other contexts has competing interests, the
Government and its attorneys already have to identify those
interests in determining how to balance them against their
obligations to Indian tribes, and attorney-client communications
relating to those interests may properly be withheld or redacted
consistent with application of the fiduciary exception. See 88 Fed.
Cl. 1, 13 (2009) (observing that redactions “allo[w] the
privilege and exception to reign supreme within their respective
spheres”).
The majority’s categorical approach fails to
appreciate that privilege determinations are by their very nature
made on a case-by-case—indeed, document-by-document—basis.
Government attorneys, like private counsel, must review each
requested document and make an individualized assessment of
privilege, and courts reviewing privilege logs and challenges must
do the same. “While such a ‘case-by-case’ basis may to some slight
extent undermine desirable certainty in the boundaries of the
attorney-client privilege, it obeys the spirit of” of Rule 501,
Upjohn, 449 U. S., at 396–397, which “ ‘provide[s]
the courts with the flexibility to develop rules of privilege on a
case-by-case basis,’ ”
Trammel v.
United
States,
445 U.
S. 40, 47 (1980) (quoting 120 Cong. Rec. 40891 (1974)
(statement of Rep. Hungate)); see S. Rep. No. 93–1277,
p. 13 (1974) (“[T]he recognition of a privilege based on a
confidential relationship … should be determined on a case-by-case
basis”).
Rather than fashioning a blanket rule against
application of the fiduciary exception in the Indian trust context,
I would, consistent with Rule 501 and principles of judicial
restraint, decide the question solely on the facts before us. See
Upjohn, 449 U. S., at 386 (noting that “we sit to decide
concrete cases and not abstract propositions of law” and
“declin[ing] to lay down a broad rule or series of rules to govern
all conceivable future questions in this area”). On those facts,
the fiduciary exception applies to the communications in this
case.
B
Like the “real client” rationale,
the second rationale for the fiduciary exception, rooted in a
trustee’s fiduciary duty to disclose all matters relevant to trust
administration to the beneficiary, fully supports disclosure of the
communications in this case. As explained above, courts relying on
this second rationale have recognized that “[t]he policy of
preserving the full disclosure necessary in the trustee-beneficiary
relationship is … ultimately more important than the protection of
the trustees’ confidence in the attorney for the trust.”
Riggs, 355 A. 2d, at 714. Because the statutory
scheme requires the Government to act as a conventional fiduciary
in managing the Nation’s trust funds, the Government’s fiduciary
duty to keep the Nation informed of matters relating to trust
administration includes the concomitant duty to disclose
attorney-client communications relating to trust fund management.
See Third Restatement §82, Comment
f, at 187–188;
Restatement of the Law (Third) Governing Lawyers §84, pp. 627–628
(1998).
Notably, the majority does not
suggest that the Nation needs less information than a private
beneficiary to exercise effective oversight over the Government as
trustee. Instead, the majority contends that the Nation is entitled
to less disclosure because the Government’s disclosure obligations
are more limited than a private trustee. In particular, the
majority states that the Government “assumes Indian trust
responsibilities only to the extent it expressly accepts those
responsibilities by statute,” and thus the Nation “must point to a
right conferred by statute or regulation in order to obtain
otherwise privileged information from the Government against its
wishes.”
Ante, at 14. The majority cites a single
statutory provision and its implementing regulations as “defin[ing]
the Government’s disclosure obligation to the [Nation].”
Ante, at 22; see
ante, at 21–22 (citing 25 U.
S. C. §162a(d)(5) and 25 CFR §§115.801–115.803 (2010)).
Because those “narrowly defined disclosure obligations” do not
provide Indian tribes with a specific statutory right to disclosure
of attorney-client communications relating to trust administration,
ante, at 22, the majority concludes that the Government
has no duty to disclose those communications to the Nation.
The majority’s conclusion employs a
fundamentally flawed legal premise. We have never held that all of
the Government’s trust responsibilities to Indians must be set
forth expressly in a specific statute or regulation. To the
contrary, where, as here, the statutory framework establishes that
the relationship between the Government and an Indian tribe “bears
the hallmarks of a conventional fiduciary relationship,”
Navajo
II, 556 U. S., at __ (slip op., at 14) (internal quotation
marks omitted), we have consistently looked to general trust
principles to flesh out the Government’s fiduciary obligations.
For example, in
United States v.
White Mountain Apache Tribe,
537 U. S. 465 (2003), we
construed a statute that vested the Government with discretionary
authority to “use” trust property for certain purposes as imposing
a concomitant duty to preserve improvements that had previously
been made to the land.
Id., at 475 (quoting 74 Stat. 8).
Even though the statute did not “expressly subject the Government
to duties of management and conservation,” we construed the
Government’s obligations under the statute by reference to
“elementary trust law,” which “confirm[ed] the commonsense
assumption that a fiduciary actually administering trust property
may not allow it to fall into ruin on his watch.” 537 U. S., at
475
. Similarly, in
Seminole Nation, we relied on
general trust principles to conclude that the Government had a
fiduciary duty to prevent misappropriation of tribal trust funds by
corrupt members of a tribe, even though no specific statutory or
treaty provision expressly imposed such a duty. See 316 U. S., at
296.[
Footnote 8]
Accordingly, although the “general ‘contours’
of the government’s obligations” are defined by statute, the
“in-terstices must be filled in through reference to general trust
law.”
Cobell, 240 F. 3d, at 1101 (quoting
Mitchell II, 463 U. S., at 224). This approach accords
with our recognition in other trust contexts that “the primary
function of the fiduciary duty is to constrain the exercise of
discretionary powers which are controlled by no other specific duty
imposed by the trust instrument or the legal regime.”
Varity
Corp. v.
Howe,
516 U. S. 489, 504
(1996) (emphasis deleted); cf.
Central States, Southeast &
Southwest Areas Pension Fund v.
Central Transport,
Inc.,
472 U. S.
559, 570 (1985) (“[R]ather than explicitly enumerating
all of the powers and duties of trustees and other
fiduciaries, Congress invoked the common law of trusts to define
the general scope of their authority and responsibility”). Indeed,
“[i]f the fiduciary duty applied to nothing more than activities
already controlled by other specific legal duties, it would serve
no purpose.”
Howe, 516 U. S., at 504.
The majority pays lip service to these
precedents, acknowledging that “[w]e have looked to common-law
principles to inform our interpretation of statutes and to
determine the scope of liability that Congress has imposed.”
Ante, at 13. But despite its assurance that it “will apply
common-law trust principles where Congress has indicated it is
appropriate to do so,”
ante, at 14, the majority
inexplicably rejects the application of common-law trust principles
in this case. In doing so, the majority states that “[t]he common
law of trusts does not override the specific trust-creating statute
and regulations that apply here.”
Ante, at 21–22
(referring to §162a(d)(5) and 25 CFR §§115.801–115.803). That
statement evidences the majority’s fundamental misunderstanding of
the way in which common-law principles operate in the context of a
conventional fiduciary relationship.
Contrary to the majority’s view, the
Government’s disclosure obligations are not limited solely to the
“narrowly defined disclosure obligations” set forth in §162a(d)(5)
and its implementing regulations,
ante, at 22; rather,
given that the statutory regime requires the Government to act as a
conventional fiduciary in managing Indian trust funds, the
Government’s disclosure obligations include those of a fiduciary
under common-law trust principles. See
supra, at 15–17.
Instead of “overrid[ing]” the specific disclosure duty set forth in
§162a(d)(5) and its implementing regulations, general trust
principles flesh out the Government’s disclosure obligations under
the broader statutory regime, consistent with its role as a
conventional fiduciary in this context.
This conclusion, moreover, is supported by the
plain text of the very statute cited by the majority. Section
162a(d), which was enacted as part of the American Indian Trust
Fund Management Reform Act of 1994 (1994 Act), 108 Stat. 4239, sets
forth eight “trust responsibilities of the United States.” But that
provision also specifically states that the Secretary of the
Interior’s “proper discharge of the trust responsibilities of the
United States shall include
(but are not limited to)”
those specified duties. 25 U. S. C. §162a(d) (emphasis added).
By expressly including the italicized language, Congress recognized
that the Government has pre-existing trust responsibilities that
arise out of the broader statutory scheme governing the management
of Indian trust funds.[
Footnote
9] Indeed, Title I of the 1994 Act is entitled
“
Recognition of Trust Responsibility,” 108 Stat. 4240
(emphasis added), and courts have similarly observed that the Act
“recognized and reaffirmed … that the government has longstanding
and substantial trust obligations to Indians.”
Cobell, 240
F. 3d, at 1098; see also H. R. Rep. No. 103–778,
p. 9 (1994) (“The responsibility for management of Indian
Trust Funds by the [Government] has been determined through a
series of court decisions, treaties, and statutes”). That
conclusion accords with common sense as not even the Government
argues that it had no disclosure obligations with respect to Indian
trust funds prior to the enactment of the 1994 Act.[
Footnote 10]
The majority requires the Nation to “point to
a right conferred by statute” to the attorney-client communications
at issue,
ante, at 14, and finding none, denies the Nation
access to those communications. The upshot of that decision, I
fear, may very well be to reinvigorate the position of the
dissenting Justices in
White Mountain Apache and
Mitchell II, who rejected the use of common-law principles
to inform the scope of the Government’s fiduciary obligations to
Indian tribes. See
White Mountain Apache, 537 U. S., at
486–487 (Thomas, J., dissenting);
Mitchell II, 463 U. S.,
at 234–235 (Powell, J., dissenting). That approach was wrong when
Mitchell II was decided nearly 30 years ago, and it is
wrong today. Under our governing precedents, common-law trust
principles play an important role in defining the Government’s
fiduciary duties where, as here, the statutory scheme establishes a
conventional fiduciary relationship. Applying those principles in
this context, I would hold that the fiduciary exception is fully
applicable to the communications in this case.[
Footnote 11]
III
We have described the Federal
Government’s fiduciary duties toward Indian tribes as consisting of
“moral obligations of the highest responsibility and trust,” to be
fulfilled through conduct “judged by the most exacting fiduciary
standards.”
Seminole Nation, 316 U. S., at 297; see also
Mitchell II, 463 U. S., at 225–226 (collecting cases). The
sad and well-documented truth, however, is that the Government has
failed to live up to its fiduciary obligations in managing Indian
trust fund accounts. See,
e.g.,
Cobell, 240
F. 3d, at 1089 (“The General Accounting Office, Interior
Department Inspector General, and Office of Management and Budget,
among others, have all condemned the mismanagement of [Indian]
trust accounts over the past twenty years”); Misplaced Trust 8
(“[T]he [Government’s] indifferent supervision and control of the
Indian trust funds has consistently resulted in a failure to
exercise its responsibility and [to meet] any reasonable
expectations of the tribal and individual accountholders, Congress,
and taxpayers”);
id., at 56 (“[H]ad this type of
mismanagement taken place in any other trust arrangements such as
Social Security, there would be war”).
As Congress has recognized,
“[t]he Indian trust fund is more than balance sheets and accounting
procedures. These moneys are crucial to the daily operations of
native American tribes and a source of income to tens of thousands
of native Americans.”
Id., at 5. Given the history of
governmental mismanagement of Indian trust funds, application of
the fiduciary exception is, if anything, even more important in
this context than in the private trustee context. The majority’s
refusal to apply the fiduciary exception in this case deprives the
Nation—as well as the Indian tribes in the more than 90 cases
currently pending in the federal courts involving claims of tribal
trust mismanagement, App. to Pet. for Cert. 126a–138a—of highly
relevant information going directly to the merits of whether the
Government properly fulfilled its fiduciary duties. Its holding
only further exacerbates the concerns expressed by many about the
lack of adequate oversight and accountability that has marked the
Government’s handling of Indian trust fund accounts for
decades.
But perhaps even more troubling than the
majority’s refusal to apply the fiduciary exception in this case is
its disregard of our established precedents that affirm the central
role that common-law trust principles play in defining the
Government’s fiduciary obligations to Indian tribes. By rejecting
the Nation’s claim on the ground that it fails to identify a
specific statutory right to the communications at issue, the
majority effectively embraces an approach espoused by prior
dissents that rejects the role of common-law principles altogether
in the Indian trust context. Its decision to do so in a case
involving only a narrow evidentiary issue is wholly unnecessary
and, worse yet, risks further diluting the Government’s fiduciary
obligations in a manner that Congress clearly did not intend and
that would inflict serious harm on the already-frayed relationship
between the United States and Indian tribes. Because there is no
warrant in precedent or reason for reaching that result, I
respectfully dissent.
Footnote 1
See,
e.g.,
Solis v.
Food Employers Labor Relations Assn., __ F. 3d __,
2011 WL 1663597, *4–5 (CA4 2011);
Wachtel v.
Health
Net, Inc., 482 F. 3d 225, 232–234 (CA3 2007);
Bland v.
Fiatallis North America, Inc., 401
F. 3d 779, 787–788 (CA7 2005);
United States v.
Mett, 178 F. 3d 1058, 1062–1064 (CA9 1999);
In re Long Island Lighting Co., 129 F. 3d 268,
271–272 (CA2 1997);
Wildbur v.
ARCO Chemical Co.,
974 F. 2d 631, 645 (CA5 1992);
Fausek v.
White, 965 F. 2d 126, 132–133 (CA6 1992); see also
Restatement (Third) of Trusts §82, Comment
f and
Reporter’s Notes on §82, pp. 187–188, 198–204 (2005); Restatement
of Law (Third) Governing Lawyers §84 (1998).
Footnote 2
See,
e.g., 25 U. S. C.
§458cc(a) (directing Secretary of the Interior to enter into
funding agreements with Indian tribes “in a manner consistent with
the Federal Government’s laws and trust relationship to and
responsibility for the Indian people”); §3701 (finding that the
Government “has a trust responsibility to protect, conserve,
utilize, and manage Indian agricultural lands consistent with its
fiduciary obligation and its unique relationship with Indian
tribes”); 20 U. S. C. §7401 (“It is the policy of the United
States to fulfill the Federal Government’s unique and continuing
trust relationship with and responsibility to the Indian people for
the education of Indian children”).
Footnote 3
Trust fund accounts are “comprised mainly of
money received through the sale or lease of trust lands and include
timber stumpage, oil and gas royalties, and agriculture fees,” as
well as “judgment funds awarded to tribes.” H. R. Rep. No. 103–778,
p. 9 (1994). The Nation’s claims involve proceeds derived from the
Government’s management of the Nation’s timber, gravel, and other
resources and leases of reservation lands. The Government has held
these funds in trust for the Nation since the late 1880’s. See App.
to Pet. for Cert. 98a–100a, 105a.
Footnote 4
See,
e.g., 25 U. S. C. §4011(a)
(requiring Secretary of the Interior to account “for the daily and
annual balance of all funds held in trust by the United States for
the benefit of an Indian tribe”); §4041(1) (creating the Office of
Special Trustee for American Indians “to provide for more effective
management of, and accountability for the proper discharge of, the
Secretary’s trust responsibilities to Indian tribes”).
Footnote 5
For example, in
United States v.
Mitchell,
445 U. S. 535 (1980)
(Mitchell I), this Court held that a federal statute which
authorized the President to allot a specified number of acres to
individual Indians residing on reservation lands did not “provide
that the United States has undertaken full fiduciary
responsibilities as to the management of allotted lands.”
Id., at 542. Under the statute, “the Indian allottee, and
not a representative of the United States, is responsible for using
the land for agricultural or grazing purposes.”
Id., at
542–543. Accordingly, we concluded that Congress did not intend to
“impose upon the Government all fiduciary duties ordinarily placed
by equity upon a trustee” because the statute “created only a
limited trust relationship between the United States and the
allottee.”
Id., at 542; see also
Navajo I, 537 U.
S., at 507–508 (concluding that Secretary of the Interior did not
assume “fiduciary duties” under the relevant statutory scheme
because “[t]he Secretary is neither assigned a comprehensive
managerial role nor, … expressly invested with responsibility to
secure the needs and best interests of the Indian owner and his
heirs” (internal quotation marks omitted)).
Footnote 6
The majority also states that ownership of
the requested documents is “a significant factor” in deciding
whether the fiduciary exception applies,
ante, at 23, but
the only case it cites as support deals with the source of payment
for the legal advice, not the ownership of the documents. See
ibid. (citing
Riggs Nat. Bank of Washington,
D. C. v.
Zimmer, 355 A. 2d 709, 712 (Del.
Ch. 1976)).
Footnote 7
In
Nevada, the Government
represented certain tribes in litigation involving water rights
even though it was also required by statute to represent the water
rights of a reclamation project. See 463 U. S., at 128 (noting that
Congress delegated to the Secretary of the Interior “both the
responsibility for the supervision of the Indian tribes and the
commencement of reclamation projects in areas adjacent to
reservation lands”). Because of this dual litigating
responsibility, we noted that “it is simply unrealistic to suggest
that the Government may not perform its obligation to represent
Indian tribes in litigation when Congress has obliged it to
represent other interests as well.”
Ibid. We thus observed
in the context of that case that “the Government cannot follow the
fastidious standards of a private fiduciary, who would breach his
duties to his single beneficiary solely by representing potentially
conflicting interests without the beneficiary’s consent.”
Ibid. We expressly distinguished the context “where only a
relationship between the Government and the tribe is involved.”
Id., at 142. In that context, we acknowledged that “the
law respecting obligations between a trustee and a beneficiary in
private litigation will in many, if not all, respects adequately
describe the duty of the United States.”
Ibid.
Footnote 8
To be sure, in decisions involving the
jurisdiction of the Court of Federal Claims under the Tucker Act,
we have explained that the jurisdictional analysis “must train on
specific rights-creating or duty-imposing statutory or regulatory
prescriptions.” Navajo I, 537 U. S., at 506. But even assuming
arguendo that those jurisdictional decisions have
relevance here, they do not stand for the proposition that the
Government’s fiduciary duties are defined exclusively by express
statutory provisions. Indeed, those decisions relied specifically
on general trust principles to determine whether the relevant
statutory scheme permitted a damages remedy, a prerequisite for
jurisdiction under the Tucker Act. See,
e.g.,
Mitchell
II, 463 U. S., at 226 (noting that common-law trust sources
establish that “a trustee is accountable in damages for breaches of
trust” and that, “[g]iven the existence of a trust relationship, it
naturally follows that the Government should be liable in damages
for the breach of its fiduciary duties”); see also
Navajo
II, 556 U. S., at ___ (slip op., at 14) (affirming that
general “trust principles … could play a role in inferring that the
trust obligation is enforceable by damages” (internal quotation
marks and brackets omitted)).
Footnote 9
The majority invokes the canon against
superfluity and argues that the “catchall” phrase (by which it
means the “shall include (but are not limited to)” language) cannot
be read to “include a general common-law duty to disclose all
information related to the administration of Indian trusts” because
doing so would “impose general obligations that would include those
specifically enumerated.”
Ante, at 22. But the flaw in the
majority’s argument is that it misperceives the function of the
relevant language. Rather than serving as a “catchall” provision
that affirmatively “incorporate[s]” common-law trust duties into
§162a(d),
ante, at 22, that language simply makes clear
that §162a(d) does not set forth an exhaustive list of the
Government’s trust responsibilities in managing Indian trust funds;
nothing in that language itself imports any substantive obligations
into the statute.
Footnote 10
The majority also contends that its reading
of §162a(d) is supported by a provision in the Indian Claims
Limitation Act of 1982 (ICLA), 96 Stat. 1976, which provided that
if the Secretary of the Interior rejected a claim for litigation by
an Indian claimant, he was required to provide upon request “any
nonprivileged research materials or evidence gathered by the United
States in the documentation of such claim.” §5(b),
id., at
1978. According to the majority, this provision reflected Congress’
understanding that “the Government retains evidentiary privileges
allowing it to withhold information related to trust property from
Indian tribes.”
Ante, at 22, n. 11. But this
provision cannot bear the weight the majority places on it. Even
putting aside the undisputed fact that the ICLA is inapplicable to
the claims in this case, the majority’s reliance on the ICLA
provision fails to recognize that documents subject to the
fiduciary exception are, under the “real client” rationale,
per
se nonprivileged. See,
e.g., Mett, 178 F. 3d, at
1063. Accordingly, if anything, the ICLA’s requirement that the
Government disclose “nonprivileged” materials to Indian claimants
supports the conclusion that Congress intended communications
related to trust fund management to be disclosed to Indian
tribes.
Footnote 11
The majority’s errors are further compounded
by its failure to accord proper consideration to the mandamus
posture of this case. “This Court repeatedly has observed that the
writ of mandamus is an extraordinary remedy, to be reserved for
extraordinary situations.”
Gulfstream Aerospace Corp. v.
Mayacamas Corp.,
485 U. S. 271, 289
(1988). “As the writ is one of the most potent weapons in the
judicial arsenal, three conditions must be satisfied before it may
issue,”
Cheney v.
United States Dist. Court for D.
C.,
542 U. S.
367, 380 (2004) (internal quotation marks and citation
omitted):
“First, the party seeking issuance of the writ
must have no other adequate means to attain the relief he desires—a
condition designed to ensure that the writ will not be used as a
substitute for the regular appeals process. Second, the petitioner
must satisfy the burden of showing that his right to issuance of
the writ is clear and indisputable. Third, even if the first two
prerequisites have been met, the issuing court, in the exercise of
its discretion, must be satisfied that the writ is appropriate
under the circumstances.”
Id., at 380–381 (internal
quotation marks and citations omitted; alterations deleted).
The majority purports to leave the decision
whether to grant mandamus relief to the Federal Circuit, but
simultaneously drops a footnote stating that it “assume[s]” that
the Court of Federal Claims on remand will “follow [its] holding”
that the fiduciary exception is inapplicable here.
Ante,
at 24, and n. 13. By doing so, the majority virtually assures
that the Nation will not be able to use the communications at issue
in this litigation, thereby effectively granting extraordinary
relief to the Government upon no showing whatsoever that the
stringent conditions for mandamus have been met.
Comments
Be the first to comment
Leave a Comment