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Law Offices of Vincent Vitale v. Tabbytite (7/25/97), 942 P 2d 1141
Notice: This opinion is subject to correction before publication in
the Pacific Reporter. Readers are requested to bring errors to the attention of
the Clerk of the Appellate Courts, 303 K Street, Anchorage, Alaska 99501, phone
(907) 264-0608, fax (907) 264-0878.
THE SUPREME COURT OF THE STATE OF ALASKA
LAW OFFICES OF VINCENT VITALE,)
P.C., and VINCENT VITALE, ) Supreme Court Nos. S-7351/7542
Cross-Appellees, ) Superior Court No.
) 3AN-93-9653 CI
BERTHA MAE TABBYTITE, and THE ) O P I N I O N
MUNICIPALITY OF ANCHORAGE, )
Appellees/ ) [No. 4852 - July 25, 1997]
Appeal from the Superior Court of the State of
Alaska, Third Judicial District, Anchorage,
Milton M. Souter, Judge.
Appearances: Vincent Vitale, Anchorage, for
Appellants/Cross-Appellees. Tony Strong, Law Offices of Tony
Strong & Associates, Juneau, for Appellees/Cross-Appellants.
Before: Compton, Chief Justice, Rabinowitz,
Matthews, Eastaugh, and Fabe, Justices.
RABINOWITZ, Justice, with whom COMPTON, Chief
Justice, joins, dissenting.
Federal statute 25 U.S.C. sec. 410 (1994) insulates from
reach of creditors proceeds from the sale or lease of Indian
allotment lands. A road which became public was illegally built on
Bertha Mae Tabbytite's allotment. More than two decades later, the
land on which the road was located was formally taken in
condemnation proceedings and a money judgment in her favor was
entered. The main question in this case is whether the proceeds
from this judgment are protected under section 410. We answer in
the affirmative because we conclude that the judgment is money
accruing from an involuntary lease and sale of Tabbytite's land.
II. FACTS AND PROCEEDINGS
Bertha Mae Tabbytite owns a 160-acre Indian allotment in
the Chugach Mountains in Anchorage. In 1958 Glen Clarke con-
structed a road across Tabbytite's property without any right to do
so. Clarke transferred the road to the City of Glen Alps. Glen
Alps was eventually annexed by the Municipality of Anchorage.
Litigation prompted by the road began in 1969 when the
United States, joined by Tabbytite as an intervener, sued to enjoin
the use of the road and sought trespass damages. The course of the
litigation can be traced through United States v. Clarke, 529 F.2d
984 (9th Cir. 1976); United States v. Clarke, 590 F.2d 765 (9th
Cir. 1979); and United States v. Clarke, 445 U.S. 253 (1980). In
the case last cited, the Supreme Court of the United States held
that the Municipality could not acquire the road by inverse
The Municipality then brought a formal condemnation
action to acquire the road. Ten years after it was filed, the case
was tried in the United Stated District Court for the District of
Alaska. The court awarded Tabbytite damages of $165,962,
consisting of four items:
(1) Value of the property on which the road is constructed
(2) Value of the road as constructed (separate from the value
of the bare land) -- $60,000;
(3) Fair rental value of the bare land on which the road is
built from the date of first Municipal occupancy until condemnation
-- $13,000; and
(4) Fair rental value of the road as constructed (separate
from the rental value of the bare land) -- $79,800.
Both the Municipality and Tabbytite appealed from the
condemnation award. The Ninth Circuit rejected the arguments of
both parties and affirmed the award on September 23, 1992.
Between 1976 and 1980, Vincent Vitale acted as counsel to
Tabbytite in connection with the litigation described above. In
1980 Tabbytite terminated the lawyer-client relationship. Prior to
his termination, Vitale filed an attorney's lien seeking security
for payment of his fees from litigation proceeds. After the Ninth
Circuit affirmed the condemnation award, the Municipality owed
Tabbytite, including interest and less sums previously deposited,
$197,460. The Municipality did not believe that it could deliver
this sum to Tabbytite without risking double liability because it
was aware of Vitale's lien claim. It therefore filed a complaint
for interpleader in the superior court against Tabbytite and
Vitale. Alleging that it had no interest in the funds but that it
was exposed to possible double liability, the Municipality
requested the adjudication of the validity of the conflicting
claims of Tabbytite and Vitale.
Vitale answered the interpleader complaint and asserted
a cross-claim against Tabbytite, seeking enforcement of his
attorney's lien. Tabbytite responded by filing a fee arbitration
petition under Alaska Bar Rule 39. Tabbytite petitioned to stay
the interpleader action under the automatic stay provisions of
Alaska Bar Rule 39(b). The superior court granted this petition.
Thereupon the focus of the parties shifted to the fee arbitration.
The fee arbitration panel reached its decision on March
15, 1995. It awarded Vitale $64,375, representing the present
value of fair and reasonable compensation for his services to
Tabbytite. Vitale then moved in the interpleader action for an
"Order Confirming and Reducing to Judgment"the arbitration award
and for a final judgment and disbursement of the interpled funds.
Tabbytite opposed this motion and moved for dismissal of
the action. One ground which she asserted in her opposition and in
support of her motion to dismiss was based on 25 U.S.C. sec. 410,
which provides as follows:
No money accruing from any lease or sale
of lands held in trust by the United States for any Indian shall
become liable for the payment of any debt of, or claim against,
such Indian contracted or arising during such trust period, or, in
case of a minor, during his minority, except with the approval and
consent of the Secretary of Interior.
After much additional briefing, the superior court
entered an order dismissing the case, reasoning that it was
divested of subject matter jurisdiction by the application of 25
U.S.C. sec. 410. Finding that the condemned land was held in trust
on dates pertinent to section 410, the court wrote:
[T]his court concludes that a condemnation is
a sale, albeit a forced one. See Jackson v. New York, 106 N.E. 758
(N.Y. 1914), in which Justice Cardozo said: "'[c]ondemnation' is
an enforced sale, and the state stands toward the owner as a buyer
toward a seller." But, if there be any doubt on the issue, the
doubt should be resolved in favor of defendant Tabbytite under the
well recognized principle that when a statute affecting Indian
rights is ambiguous the ambiguities must be resolved in favor of
the Indian. Bryan v. Itasca County, 426 U.S. 373, 392 (1976).
Finally, this Court's determination that condemnation proceeds are
protected by 25 U.S.C. 410 furthers the intent of the statute which
is to protect revenue generated by Indian trust land. Squire v.
Capoeman, 351 U.S. 1 (1956).
The court dismissed the action and ordered the interpled funds
returned to the Municipality of Anchorage. Subsequently, Tabbytite
moved for attorney's fees and costs. This motion was denied for
the stated reason that the court lacked subject matter jurisdiction
over the underlying dispute.
Vitale appeals. On appeal he raises essentially three
arguments. First, he argues that he was entitled to a personal
judgment against Tabbytite based on the arbitration award. Second,
he contends that section 410 did not divest the superior court of
jurisdiction. And third, he argues that section 410, for a number
of reasons, does not apply to the interpled funds.
Tabbytite has filed a cross-appeal from the court's
failure to award her attorney's fees and costs. We proceed to
address the parties' arguments.
1. Was Vitale Entitled to a Personal Judgment Based on the
Fee Arbitration Award?
We answer this question in the affirmative. Bar Rule
40(t) requires the superior court to confirm an award and reduce it
to judgment upon the application of a party unless either party has
timely sought to vacate, correct or modify it. [Fn. 2] Tabbytite
advances two grounds in opposition.
First, she claims that 25 U.S.C. sec. 82 (1994) prohibits
Vitale from enforcing any personal contract with Tabbytite without
approval of the Secretary of the Interior. [Fn. 3] Section 82
applies to agreements "made by any person with any tribe of
Indians, or individual Indians not citizens of the United States
. . . ." 25 U.S.C. sec. 81 (1994). The application of section 82
individual Indians currently has little, if any, force, since it is
limited to Indians who are not citizens of the United States.
Tabbytite makes no claim that she is not a United States citizen,
and therefore she is not entitled to the protection of section 82.
Second, Tabbytite presents an argument the caption of
which states: "The Findings of the Panel Are Based on Fraud." The
entire argument presented under this caption is as follows:
Ms. Tabbytite asserts that the findings
of the Fee Arbitration Panel are based on incorrect information.
Ms. Tabbytite asserts that Mr. Vitale waived any fee when he
voluntarily withdrew from the underlying federal case cited above.
She has been consistent and persistent on that point. Furthermore
she is insistent that Mr. Vitale's claims are not recognizable in
State Court. Ms. Tabbytite respectfully requests this Court to
affirm the dismissal.
Under AS 09.43.120(a) an arbitration award can be vacated if it was
procured by fraud.
Tabbytite's argument in her brief on appeal is an almost
verbatim reproduction of the argument she made in opposition to the
motion to confirm the award before the trial court. No instance of
fraud is specified in this argument. Fraud, in fact, is not
mentioned. Fraud, even in an initial pleading, must be averred
with particularity. Alaska R. Civ. P. 9(b). It follows that a
confirmation award may not be resisted merely by reciting without
specificity that fraud existed. Further, at the motion stage,
evidentiary support for particular fraud claims must be presented.
See, e.g., Alaska R. Civ. P. 56(c); McHugh v. Church, 583 P.2d 210,
217 (Alaska 1978). We conclude therefore that Tabbytite did not
present a legally sufficient claim of fraud as a defense to the
motion to confirm. Further, given her briefing as set forth above,
if she had presented such a defense it would be waived on appeal
because of inadequate briefing. See Adamson v. University of
Alaska, 819 P.2d 886, 889 n.3 (Alaska 1991); State v. O'Neill
Investigations, Inc., 609 P.2d 520, 528 (Alaska 1980).
2. Did the Superior Court Have Subject Matter Jurisdiction?
We answer this argument in the affirmative as well. Even
if 25 U.S.C. sec. 410 bars imposing liability on the proceeds of
condemnation action, nothing in section 410 excludes state court
jurisdiction. Section 410 does not purport to make federal juris-
diction exclusive. Where a federal statute is silent on the
question of jurisdiction, state and federal courts have concurrent
jurisdiction. Charles Dowd Box Co. v. Courtney, 368 U.S. 502, 506-
08 (1962); Paul v. Nauska, 395 P.2d 260, 262-63 (Alaska 1964).
Indeed, a state court of general jurisdiction may not refuse to
hear a case brought under a federal statute unless it also lacks
jurisdiction to hear state cases of the same type. Testa v. Katt,
330 U.S. 386 (1947); E.A. v. State, 623 P.2d 1210, 1215 n.13
(Alaska 1981). Thus the superior court had jurisdiction to decide
the application of section 410 to the proceeds in question here.
Because we hold that the superior court had jurisdiction,
we need not address Vitale's arguments regarding various
permutations of the doctrine of res judicata. Similarly, his
arguments that Tabbytite waived her jurisdictional objections are
3. Does Section 410 Apply to the Proceeds of the Condemna-
We answer this question in the affirmative for the
reasons expressed by the superior court. [Fn. 4] Section 410 is
designed to exempt certain Indian property from liability for the
payment of certain debts. In Matter of City of Nome, 780 P.2d 363,
367 (Alaska 1989), we noted that a federal statute designed to
protect from creditors certain categories of Indian property should
be construed broadly: "ambiguities must be resolved in favor of
the Indians." Id.
An award of compensation for land which is forcibly
conveyed in a condemnation action can readily be categorized as
money accruing from a sale of the land in question. As Judge
Cardozo put it, "'Condemnation' is an enforced sale, and the state
stands toward the owner as buyer toward seller. On that basis the
rights and duties of each must be determined." Jackson v. State,
106 N.E. 758, 758 (N.Y. 1914); see also, United States v. 27,223.21
Acres of Land, 589 F. Supp. 1121, 1124 (D. Colo. 1984); Herskovitz
v. Vespico, 362 A.2d 394, 397 (Pa. 1976).
Similarly, damages for the precondemnation use of land
are analogous to lease proceeds. The court in the condemnation
case calculated damages for the precondemnation use of Tabbytite's
land based on its fair rental value:
The fair rental value of the road, from
the time the City began its occupancy, to the time the City
condemned the road, was $13,000. This compensates Ms. Tabbytite
for the fair market value of the City's use during the time that
the City did not pay rent for the land upon which the road was
built. This is the rent value of the bare land, not including the
The City had the advantage of the
improved road, which had been conferred as an unwanted benefit by
Clarke onto Tabbytite's land, for nineteen years, from 1961 to
1980. The fair rental value of the bare land during this time must
be increased by the rental value of the improvement. I find that
a fair measure, roughly in accord with market values, for a lease
of the improvement subject to maintenance by the Municipality as
tenant, would be 7% per year of what it cost to build the road,
$60,000, times 19 years, for a rent on the improvement of $79,800.
This is for rent value of the improvement, independently of the
rent value of the bare land.
(Emphasis added.) Just as Tabbytite can be said to have
involuntarily sold a portion of her land and received proceeds for
the sale in the condemnation action, it is reasonable to conclude
that the use of the same land prior to the formal condemnation
action was an involuntary leasing and the damages for that use were
Vitale argues that trespass damages are not the
equivalent of proceeds from a forced lease. He points out that
damages for trespass may include amounts for emotional distress
suffered by the owner and for physical harm to the land and that
such amounts would not take on the character of lease proceeds. We
need not decide whether trespass damages are equivalent to lease
proceeds in every case. In this case there is no doubt that the
entire amount of the damage award for trespass was based on the
precondemnation use of the land measured by its rental value. The
award thus had the character of lease proceeds. See Restatement
(Second) of Torts sec. 931 cmt. b & illus. 1 (1979).
We conclude, for the above reasons, that all of the
proceeds from the condemnation action reasonably can be considered
to have accrued from the lease or sale of allotment lands. The
proceeds thus fall within the protection of section 410. [Fn. 5]
Vitale contends that, even if the proceeds here are
protected by section 410, attorney's fees arising from work
performed to protect allotment rights are excepted from the
section's bar. As support for this position he cites Arenas v.
Preston, 181 F.2d 62 (9th Cir.), cert. denied, 340 U.S. 819 (1950).
In Arenas, the Ninth Circuit allowed an attorney's lien
to be placed on an Indian allotment despite the inalienability of
that land. Id. at 66-67. In doing so the court reasoned that such
a course of action would, in effect, serve the congressional
purpose of affording extra protection to Native allotments. Id. at
66. That is, without the services of the attorney the Indian would
not have received his allotment at all. Id. Vitale urges this
court to apply this same doctrine to proceeds protected by section
While the matter is not free from doubt, we think that
Arenas is not controlling. Section 410 is neither mentioned nor
discussed in the Arenas opinion. Given that section 410 applies,
we are not free to decide this case based on the rationale
underlying Arenas, because that rationale conflicts with the
explicit command of the statute. [Fn. 6]
4. Did the Trial Court Err in its Denial of Attorney's Fees?
Tabbytite argues on cross-appeal that the superior court
should have awarded her attorney's fees under Civil Rule 82 because
she was the "prevailing party." The superior court declined to
award attorney's fees because it had ruled that it possessed no
subject matter jurisdiction. Because we hold that the superior
court had jurisdiction, we also direct that court to consider the
issue of attorney's fees on remand. The superior court must, of
course, determine who is the prevailing party before awarding fees.
The dismissal of this case for lack of subject matter
jurisdiction is REVERSED. This case is REMANDED for (1) entry of
a personal judgment in favor of Vitale, (2) entry of judgment
awarding the interpled funds to Tabbytite, (3) determination of the
prevailing party and an award of attorney's fees to such party, and
(4) such other and further relief as may be appropriate.RABINOWITZ,
Justice, with whom COMPTON, Chief Justice, joins, dissenting.
I cannot agree with a construction of 25 U.S.C. sec. 410
that effectively leaves indigent Natives without access to legal
counsel when challenging a trespass to their allotment lands. I
therefore dissent from Section III.3 of the court's opinion.
By its terms, sec. 410 immunizes proceeds from the "sale
lease"of a restricted Indian allotment. The principal question
posed by this appeal is thus whether Tabbytite's trespass and
condemnation judgment constitutes the proceeds of a "sale or
The court relies on the fact that "[a]n award of
compensation for land which is forcibly conveyed in a condemnation
action can readily be categorized as money accruing from a sale of
the land in question"and "damages for the precondemnation use of
land are analogous to lease proceeds"to hold that Tabbytite's
award is protected. The difficulty with this approach is not that
the court has given the wrong answer, but that it has asked the
wrong question. In my view, this case does not require an inquiry
into the essence of a lease, or an investigation into whether their
inherent natures include a condemnation award. Obviously, sale and
lease proceeds and condemnation awards share similarities and
differences. Whether it is the similarities or the differences
which predominate will depend on the circumstances of the
particular case. For some purposes, it is the similarities which
are relevant. Thus Justice Cardozo has concluded that the lease
value of land is a handy measure of the damages to be awarded upon
condemnation. Jackson v. State, 106 N.E. 758 (N.Y. 1914). The
United States District Court followed this approach when
calculating Tabbytite's award. However, the fact that an analogy
was useful does not mean that condemnation is the equivalent of a
sale or lease in all circumstances and for all purposes. In each
case, whether the simile is appropriate will depend on the ends to
be served by the rule being applied.
Here we must ask whether treating a trespass as a lease
is consistent with the policies underlying sec. 410. That statute
intended to preserve the financial security afforded to an
individual Indian by an allotment. Preventing Vitale from
asserting his attorney's lien obviously increases the amount of
allotment-derived money that Tabbytite will retain. Thus the court
cites Matter of City of Nome, 780 P.2d 363 (Alaska 1989), where we
invoked the rule that ambiguities in a statute are to be resolved
in favor of the Indians. See id. at 367.
I endorse the rule, see id. at 370 (Rabinowitz, J.,
dissenting), but not the way it has been applied here. An outcome
that is favorable for the individual Indian litigant may not always
be beneficial for Indians as a group. Indeed, sometimes the
interests will conflict. So much was acknowledged by the Supreme
Court of the United States in Negonsott v. Samuels, 507 U.S. 99,
110 (1993), when it rejected the appeal of an Indian defendant
charged with shooting another Indian on a reservation. The
defendant challenged the state's assertion of criminal jurisdiction
under the Kansas Act, arguing that the Act should be construed in
his favor (and against state jurisdiction). Id. at 104. The court
rejected such an approach, finding "no reason to equate 'benefit of
dependent Indian tribes' . . . with 'benefit of accused Indian
criminals,' without regard to the interests of the victims of these
crimes or of the tribe itself." Id. at 110 (quoting Bryan v.
Itasca County, 426 U.S. 373, 392 (1976)). In other words, what is
beneficial for the individual Indian will not always be good for
the tribe. When interpreting a federal Indian statute, the first
question to ask must always be which construction is consistent
with the policies animating the legislation, in light of the
federal government's trust relationship toward Indians. See United
States v. Mitchell, 463 U.S. 206, 226 (1983); Seminole Nation v.
United States, 316 U.S. 286, 296 (1942). See also Reid Peyton
Chambers, Judicial Enforcement of the Federal Trust Responsibility
to Indians, 27 Stan. L. Rev. 1213, 1214-15 (1975).
Here there can be no argument preventing Indians from
entering into enforceable contingent fee agreements to protect
their interests in allotments is at cross purposes with the
allotment statutes. In this regard, I find the Ninth Circuit's
reasoning in Arenas v. Preston, 181 F.2d 62 (9th Cir. 1950),
compelling. That case addressed whether 25 U.S.C. sec. 345, which
authorizes a suit by an Indian to acquire an allotment, also
precludes enforcement of a lien on the property by the litigating
attorney. Id. at 66. The court had no difficulty dismissing such
a construction, noting that:
When the United States authorized [actions for
allotments], it did so knowing that the Indian by himself was
incapable of taking advantage of the privilege and that attorney
fees and other expenses would be the unavoidable concomitant. It
also knew that the Indian litigant, with few exceptions, was
without the means to meet the necessary expenses. It seems to us
that Congress could not have intended to commit the subject to its
courts with any paralyzing limitation but, in committing the
subject to its courts it intended them to fully exercise their
general equitable jurisdiction [to enforce attorney's fee
Id. at 66-67.
This reasoning applies with equal force in this case. By
immunizing sale and lease proceeds, Congress sought to protect the
Indian's interest in the allotment. But if sec. 410 prevents the
destitute Native injured by a trespass to his or her allotment
lands from entering into a valid fee agreement, it will effectively
preclude the Indian from protecting his or her interest in the
property. Few attorneys will assume the risk of taking on the suit
when even a successful outcome offers no guarantee of remuneration.
Indeed, were today's ruling already fixed as precedent when
Tabbytite first approached Vitale in 1976, he too might well have
declined to take her case. Tabbytite lacked the resources to pay
an attorney out of her own pocket; her only means of inducing
Vitale to represent her was by promising him a portion of a
potential judgment. By declaring that agreement unenforceable, the
court's decision will inevitably prevent future Tabbytites from
securing counsel in like cases. Section 410 cannot be construed in
a way that defeats its own ends, that undermines the Indian's
ability to defend his or her interest in the allotment. I would
hold that Vitale may enforce his lien against Tabbytite's
condemnation award. [Fn. 1]
This was interrupted by Tabbytite's subsequent removal of the
interpleader to federal court. The United States District Court
for the District of Alaska remanded the case to the state superior
court on motion of Vitale, which was not opposed by Tabbytite. The
court stated: "It appears that removal was not timely and that it
is doubtful that any federal question exists."
Bar Rule 40(t) provides:
Confirmation of an Award. Upon applica-
tion of a party, and in accordance with the
provisions of AS 09.43.110 and AS 09.43.140, the superior court
will confirm an award, reducing it to a judgment, unless within
ninety days either party seeks through the superior court to
vacate, modify or correct the award in accordance with the
provisions of AS 09.43.120 through 140.
25 U.S.C. sec. 82 provides:
Payments under contracts; aiding in
making prohibited contracts. No money shall be paid to any agent
or attorney by an officer of the United States under any such
contract or agreement, other than the fees due him for services
rendered thereunder; but the moneys due the tribe, Indian, or
Indians, as the case may be, shall be paid by the United States,
through its own officers or agents, to the party or parties
entitled thereto; and no money or thing shall be paid to any person
for services under such contract or agreement, until such person
shall have first filed with the Commissioner of Indian Affairs, a
sworn statement, showing each particular act of service under the
contract, giving date and fact in detail, and the Secretary of the
Interior and Commissioner of Indian Affairs shall determine
therefrom whether, in their judgment, such contract or agreement
has been complied with or fulfilled; if so, the same may be paid,
and, if not, it shall be paid in proportion to the services
rendered under the contract.
Vitale does not argue that Tabbytite's land is not land held
in trust by the United States for any Indian; thus we assume that
Tabbytite's land is within the coverage of section 410.
Vitale's argument regarding the fact that, at the time his
services were rendered, there had been no sale or lease of the land
in question and that, therefore, section 410 is inapplicable, is
without merit. Section 410 proceeds are exempt from all claims
arising during the period the land is held in trust, regardless of
the relationship in time between the accrual of the claim and the
sale or lease. Vitale's argument that applying section 410
unconstitutionally impairs his contract rights is also without
merit. It is inconceivable that the inability to levy on a
specific fund to satisfy a debt unconstitutionally impairs a
contract underlying the debt when the bar on levying pre-exists the
making of the contract. Vitale's ex post facto argument is
similarly misguided. Section 410 was enacted in 1906. See 25
U.S.C. sec. 410. He rendered his services seventy years later.
Further, textual adherence to section 410 does not necessarily
mean that indigent allotment holders cannot obtain effective
representation. At least in some circumstances, as the facts in
this case illustrate in part, the Department of Justice provides
representation to allotment holders. Moreover, we cannot assume
that the Secretary of the Interior will unreasonably disapprove of
reasonable fees under section 410.
I agree with Sections III.1 and 2 of the court's opinion.