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Hopi Tribe v. Navajo Tribe



Under the Navajo-Hopi Settlement Act (Settlement Act), the Navajo Tribe must pay the fair market rental value of homesites they occupy. The homesites are located on land partitioned and allocated to the Hopi Tribe. In the early 1980s, the Deputy Assistant Secretary of the Bureau of Indian Affairs (BIA) contracted for appraisal of land based on the appraisals of comparable land as well as the market value of Navajo livestock and grasses consumed by the livestock. The Navajo Tribe had proposed the determination be based on rent charged by federal agencies for other federal lands.

After several years of consultation between the tribes, the BIA Phoenix Area Director notified the tribes of a rental determination of $1,328,025.77. He mailed this determination to the Navajo Tribe on February 15, 1985. The tribe office rerouted the letter because it did not understand the letter’s import. Because the letter was “mislaid,” the Navajos filed their administrative appeal a month after the deadline. The BIA Assistant Secretary granted the Hopi motion to deny the appeal because it was untimely. The district court upheld the decision and the Navajos appealed.

The Navajos claim BIA abused its discretion when calculating the homesite rental award by overlooking significant facts and making unsupported assumptions when calculating the homesite rental award. The Ninth Circuit affirmed the district court’s holding that the BIA action was not arbitrary or capricious because the record supports the position that BIA considered all relevant facts, made no clear error of judgment, and established a rational connection between the facts found and the amount of the award.

As one factor in its determination, BIA sought appraisals of land comparable to the HopiPartitionedLand. The rental value of the grazing area was based on the value of forage consumed and the livestock raised rather than the acreage used. Including acreage between Navajo homesites and fixtures is acceptable because the Hopi Tribe is constructively excluded from using that land. It was reasonable to charge rent for “abandoned” homesites because they were still “occupied” as storage areas and thus unavailable to the Hopi. The Ninth Circuit found BIA articulated a rational connection between the facts and the determination of rental amount, so it affirmed the district court.

The Navajos further claimed that the letter of February 15, informing them of the rental amount, did not fulfill the notice requirement of due process. The district court laid responsibility for the late filing with the Navajos because they rerouted the letter incorrectly. The Ninth Circuit determined the letter did not meet the minimum threshold of notice under the Due Process Clause of the Fifth Amendment in design and implementation. BIA had told the Navajos the determination of rental amount would be delivered to tribal counsel. As a result, the tribe was not expecting to receive the notice itself. The Navajo counsel received a telephone call March 25, 1985 that provided notice of the rental amounts. Because the counsel requested formal written notice, the date of that letter, April 3, 1985, is when the timing for appeal started running. The Navajos filed their notice of appeal on May 2, 1985, within the one-month deadline. Therefore, the Ninth Circuit held their notice of appeal was timely and reversed the district court on this question.

The Hopi Tribe cross-claimed, arguing the district court erred when it failed to award the tribe prejudgment interest on the grazing rental determination. In the Settlement Act, Congress waived tribal immunity from prejudgment interest because the two tribes can pursue all remedies available in federal court. The Ninth Circuit reasoned that waiving the interest would contradict the purpose of the Settlement Act: to compensate the Hopi for the fair rental value of their partitioned land occupied by the Navajos (and vice versa). The Ninth Circuit reversed the district court and remanded for a determination of the amount of interest owed.

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