Summary of a Recent
Judicial Development in
Alternative Dispute Resolution

Plaintiffs Not Allowed to Raise Arbitration Defense
for the First Time on Appeal

Walt McCarter
National AgLaw Center Research Associate

Summary of Decision

In Burrell v. Armijo, 456 F.3d 1159 (9th Cir. 2006), the Ninth Circuit Court of Appeals held that a tribal court's ruling should not be given preclusive effect because the plaintiffs had not been given a full and fair opportunity to litigate the issues, and then the court adjudicated the plaintiffs' claims.

Background

Plaintiffs brought this action against a federally recognized Indian tribe and its officials for violations of their federal civil rights pursuant to 42 U.S.C. §§ 1981, 1983, and 1985, and for breach of a federal farm lease. Id. at 1161. They claimed that the officials intentionally ran them off their farm, stole their crops, terminated their lease, and racially discriminated against them. Id. at 1163. After the tribal court ruled that the defendants were entitled to sovereign immunity, the plaintiffs filed suit in the district court, which held that the tribal court's holding precluded the case. Id. at 1164-66. The plaintiffs appealed. Id. at 1166.

Arguments

Plaintiffs argued that the tribal court denied their due process rights to a fair and impartial hearing by failing to make any rulings on the pending motions for almost four years, and thereafter acting on an incomplete record, ignoring their motions, and exhibiting extreme bias in favor of the defendants. Id. at 1170-71. Plaintiffs also argued that the provisions of their lease required arbitration of their damage claims, and therefore the tribe had waived sovereign immunity. Id. at 1168-69.

Analysis and Holdings

The appellate court first ruled that the plaintiffs could not raise their arbitration claim for the first time on appeal. Id. at 1170. The court then explained that the doctrine of collateral estoppel should only be applied if:

(1) the issue previously decided is identical with the one presented in the action in question, (2) the prior action has been finally adjudicated on the merits, (3) the party against whom the doctrine is invoked was a party, or in privity with a party, to the prior adjudication, and (4) the party against whom the doctrine is raised had a full and fair opportunity to litigate the issue in the prior action.
Id. at 1172.

The court found sufficient evidence indicating that the plaintiffs had not had a "full and fair opportunity to litigate the issue in the prior action," and therefore held that the tribal court's ruling should not have been given preclusive effect. Id. at 1173. The court further held that the tribe was entitled to sovereign immunity, but that the individual officials were not. Id. at 1174. However, the court dismissed one of the plaintiffs' civil rights claims because a § 1983 action is unavailable "for persons alleging deprivation of constitutional rights under color of tribal law." Id. It also dismissed the plaintiffs' breach of lease claim because they had failed to seek review of the Bureau of Indian Affairs' final decision to terminate the lease. Id. Lastly, the court remanded the plaintiffs' § 1981 and § 1985 claims against the individual tribal officials to the district court for further consideration. Id.

The case was decided on July 24, 2006.