Atkinson Trading Company, Inc. v. Shirley

PETITIONER: Atkinson Trading Company, Inc.
RESPONDENT: Shirley
LOCATION: Attorney General's Office of MA

DOCKET NO.: 00-454
DECIDED BY: Rehnquist Court (1986-2005)
LOWER COURT: United States Court of Appeals for the Tenth Circuit

CITATION: 532 US 645 (2001)
ARGUED: Mar 27, 2001
DECIDED: May 29, 2001

ADVOCATES:
Beth S. Brinkmann - Department of Justice, as amicus curiae, supporting the respondents
Charles G. Cole - Argued the cause for the petitioner
Marcelino R. Gomez - Navajo Nation, Department of Justice, Window Rock, Arizona; argued the cause for the respondents

Facts of the case

Atkinson Trading Company, Inc. owns the Cameron Trading Post, which is located on non-Indian fee land within the Navajo Nation Reservation. The Cameron Trading Post consists of a hotel, restaurant, cafeteria, gallery, curio shop, retail store, and recreational vehicle facility. In 1992, the Navajo Nation enacted a hotel occupancy tax, which imposed an 8 percent tax upon any hotel room located within the exterior boundaries of the reservation. Atkinson challenged the tax under Montana v. United States. Under Montana, with two limited exceptions, Indian tribes lack civil authority over the conduct of nonmembers on non-Indian land within a reservation. The District Court upheld that tax. In affirming, the Court of Appeals concluded that the tax fell under Montana's first exception because a "consensual relationship exists in that the nonmember guests could refrain from the privilege of lodging within the confines of the Navajo Reservation and therefore remain free from liability for the [tax]."

Question

Does the rule in Montana v. United States, that, with limited exceptions, Indian tribes lack civil authority over the conduct of nonmembers on non- Indian fee land within a reservation, apply to tribal attempts to tax nonmember activity occurring on non-Indian fee land?

Media for Atkinson Trading Company, Inc. v. Shirley

Audio Transcription for Oral Argument - March 27, 2001 in Atkinson Trading Company, Inc. v. Shirley

Audio Transcription for Opinion Announcement - May 29, 2001 in Atkinson Trading Company, Inc. v. Shirley

William H. Rehnquist:

The second opinion of the Court I have to announce is No. 00-454, Atkinson Trading Company against Shirley.

The Navajo Indian Tribe imposes an 8% tax upon all hotel rooms located within the exterior boundaries of its reservation.

The Atkinson Trading Company operates such a hotel near Cameron, Arizona, just south of the Little Colorado River on the road from Flagstaff up to the Grand Canyon.

The trading company is not a member of the Navajo Nation and owns the land itself.

It argues that the Navajo Tribe lacks the authority to enforce this hotel tax against non-members residing on non-Indian land.

The Court of Appeals for the Tenth Circuit rejected this argument.

In an opinion filed with a Clerk of the Court today, we reverse.

Our cases in this area have established that with limited exceptions Indian Tribes lack civil authority over non-members on non-Indian land within a reservation.

We hold that this general rule applies to revenue raising taxes imposed by tribes.

Although, we have upheld an Indian tribes ability to tax non members extracting oil and gas from tribal land.

Indian Tribes have never been allowed to tax non members conducting business on their own land.

This is because the Indian Tribes are dependent sovereigns and therefore, have only limited civil authority.

The Navajo Indian Tribe however, says that the exceptions to this general rule apply here; an Indian Tribe may assert civil jurisdiction over a non-Indian land where the non-members entered into a consensual relationship with the Tribe or whether non-members conduct threatens the political integrity of the Tribe, but we think that neither exception obtains here.

First although the Trading Post has a license to conduct business with Navajo Indians, this relationship cannot support the hotel tax, which is imposed upon the Trading Post’s non member guests who reach the hotel on public roads, and while the Trading Post benefits from the availability of tribal police, fire and emergency services, this is not sufficient to trigger the Navajo Nation’s civil authority otherwise the exception would simply swallow the rule.

Second the Trading Post operation of a hotel on its own land cannot be said to imperil the political integrity of the Navajo Nation.

Because the exceptions do not apply the rule of the Indian Tribes lacks civil authority over non-members on non-Indian land controls this case, the hotel tax is invalid.

Justice Souter has filed a concurring opinion in which Justice Kennedy and Thomas joined.