23 Syllabus MENOMINEE TRIBE OF INDIANS v. THE UNITED UNITED STATES [No. 44300. Decided October 7, 1946] On the Proofs Indian claims; Government obligated to pay interest on tribal funds from time money was covered into the Treasury.-Under the Act of June 12, 1890 (26 Stat. 146) and the Act of March 28, 1908 (35 Stat. 51), the Government was obligated to pay interest from the time the money was "covered" into the Treasury from the proceeds of the timber cut from plaintiff's lands in accordance with the provisions of the two Acts. Same; statutory requirement as to when funds are funded or deposited in the Treasury.-Money has not been funded in the Treasury nor deposited in the Treasury until a "covering" warrant has been issued by the Secretary of the Treasury as required by the statute. (1 Stat. 65, 66). Same; implied agreement by the Government under the statutes to deposit tribal funds promptly.-Under the provisions of the Act of 1890 and the Act of 1908, there was an implied agreement on the part of the defendant to deposit promptly in the Treasury the funds belonging to plaintiff so that interest would begin to accrue without unnecessary delay; the defendant having agreed to carry out the terms of these Acts with that fidelity which a fiduciary owes his cestui. (Menominee Tribe of Indians v. United States, 101 C. Cls. 10, and Menominee Tribe of Indians v. United States, 102 C. Cls. 555. Same; 30 days a reasonable period for depositing tribal funds.-It is held that 30 days from the time the Indian agent first received the money was ample time for the defendant to go through the entire maze of administrative red tape preliminary to "covering" the money into the Treasury and that wherever it took a longer time plaintiff is entitled to recover interest for the interim period of delay. Same; defendant entitled to recover on counterclaim.-Where the Government deposited in the Menominee Log Fund, at 5 percent interest, four-fifths of the gross proceeds of the sale of the logs cut in accordance with the provisions of the Act of June 12, 1890, whereas this Act provided for the deposit in this fund of only four-fifths of the net proceeds; it is held that the defendant is entitled to recover on its counterclaim. 107 C. Cls. Reporter's Statement of the Cage The Reporter's statement of the case: Mr. Ernest L. Wilkinson for plaintiff. Messrs. Dwight, Harris, Koegel & Caskey, and Richard E. Dwight, Andrew E. Stewart and John W. Cragun were on the brief. Mr. Wilfred Hearn, with whom was Acting Assistant Attorney General J. Edward Williams, for the defendant. The court made special findings of fact as follows: 1. This is one of several suits brought pursuant to the Act of Congress approved September 3, 1935 (c. 839, 49 Stat. 1085), as amended by the Act of Congress approved April 8, 1938 (c. 120, 52 Stat. 208), conferring jurisdiction upon this Court to hear, determine, adjudicate, and render final judgment on all legal or equitable claims of whatsoever nature which plaintiff may have against defendant growing out of any treaties, agreements, or laws of Congress or out of any maladministration or wrongful handling of any of the funds, land, timber, or other property belonging to plaintiff tribe or held in trust for it by the United States. 2. Pursuant to the Act of June 12, 1890 (26 Stat. 146), under which the Secretary of the Interior was authorized to cut and sell the timber on plaintiff's reservation, certain members of the plaintiff tribe were employed by the Secretary of the Interior to cut and bank the timber. After the logs were sold, one-fifth of the total amount received from such sales was deposited in a non-interest-bearing fund in the Treasury of the United States for the benefit of the Indian tribe, and four-fifths was deposited in a fund bearing interest at 5 percent per annum. The fund bearing 5 percent interest was denominated "Menominee Log Fund" and the non-interest-bearing fund as "Fulfilling Treaties with Menominees, Logs." The interest paid on the fund bearing 5 percent interest was deposited in a non-interest-bearing fund under the designation "Interest on Menominee Log Fund." 3. The Act of March 28, 1908 (35 Stat. 51), authorized the Secretary of the Interior to cut the timber on plaintiff's reservation, under certain restrictions, and to cause to be built and equipped sawmills and other improvements on the reservation necessary for the logging of the timber and the sawing of the same into lumber. The mill built under this authority 23 Reporter's Statement of the Case was known as the "Menominee Indian Mills." Section 3 of this Act provided that "the net proceeds of the sale of such lumber and other material shall be deposited in the Treasury of the United States to the credit of the tribe" and that such proceeds should bear interest at the rate of 4 percent per annum, the interest to be used for the benefit of plaintiff Indians in such manner as the Secretary of the Interior should prescribe. Pursuant to this authority, and as a result of the timber and lumber-manufacturing operations conducted on plaintiff's reservation under said Act, a 4 percent interest-bearing fund, entitled the "Menominee 4% Fund," was set up in the Treasury on September 30, 1909, to receive the proceeds from the sale of lumber and other products. The interest paid on this fund was deposited in a non-interest-bearing fund entitled "Interest on Menominee 4% Fund." 4. During the period April 1891 to May 1922 a total of $5,551,043.09 was deposited in the 5 percent interest-bearing fund denominated "Menominee Log Fund" (exclusive of the sum of $999,455.51 transferred to this fund from the "Menominee 4% Fund" at the close of the 1912 fiscal year). Of this total sum deposited $300,155.65 comprised four-fifths of the net receipts from timber operations conducted on plaintiff's reservation during the fiscal years 1891 and 1892, pursuant to the Act of June 12, 1890; $2,779,351.26 constituted four-fifths of the total receipts from sales of logs at said reservation during the fiscal years 1893 to 1911, inclusive, pursuant to said Act; and $40,331.27 consisted of miscellaneous receipts during the fiscal years 1909 to 1922. The balance of $2,431,204.91 comprised the proceeds of sale of lumber and other products under the Act of March 28, 1908, during the fiscal years 1912 to 1917, which were deposited from time to time in said "Menominee Log Fund" to restore in part moneys withdrawn from said fund for expenses of operations conducted on plaintiff's reservation under the Acts of June 28, 1906, and March 28, 1908. During the period August 1909 to July 1938 a total of $13,679,715.76 was deposited in the 4 percent interest-bearing fund denominated "Menominee 4% Fund." It comprises, in addition to certain miscellaneous receipts, the proceeds of sale of lumber and other manufactured materials at the Me Reporter's Statement of the Case 107 C. Cls. nominee Indian Mills in the aggregate amount of $13,135,742.47 during the years August 1909 to June 1912, inclusive, and October 1916 to June 1938, inclusive, pursuant to the Act of March 28, 1908. (Of this latter sum $999,455.51, deposited during the 1909 to 1912 period, was transferred to the "Menominee Log Fund" at the close of the fiscal year 1912, to restore in part moneys which had been withdrawn from said Fund for expenses of operations conducted on plaintiff's reservation under the authority of the Act of June 28, 1906 and the Act of March 28, 1908.) 5. Expenses for, and receipts from operations conducted on plaintiff's reservation under the authority of the Act of June 12, 1890, 26 Stat. 146, the Act of June 28, 1906, 34 Stat. 547, and the Act of March 28, 1908, 35 Stat. 51, were handled in the following manner: (a) During the first year of operations under the Act of June 12, 1890 all expenses were advanced from defendant's own funds which were reimbursed from the first proceeds of sales of logs cut under that act. (b) Thereafter all expenses of operations under all three of the aforesaid acts were paid from moneys advanced from time to time from trust funds, non-interestbearing as well as interest-bearing, held by defendant for plaintiff's benefit and placed in the hands of defendant's disbursing agent to meet such expenses as they arose. Funds withdrawn from the Treasury and used for settlement of obligations incurred by the Indian Service were and are placed to the official checking account of the disbursing officer, which is effected by drawing an accountable warrant by the Treasury Department in the amount of the funds disbursed. Funds thus placed to the credit of the Chief Disbursing Officer in Washington may thereafter be transferred to the checking account of the Regional Disbursing Officer in Chicago. Interest ceases to be paid on the trust funds as of the date the accountable warrant is drawn by the Treasury Department. (c) Under the procedure pursued in (b) above, the receipts from sales of logs, lumber and other materials represented proceeds of logs, lumber and other materials as to which the expenses of production, manufacture and sale had already been separately paid from plaintiff's interest or non-interest-bearing funds; and under 23 Reporter's Statement of the Case the practice followed by defendant, such entire proceeds were deposited in the Treasury to be credited to plaintiff's funds. 6. For sometime after defendant began the logging operations, the practice was to deposit the proceeds of the sales of logs or lumber or other materials either in a bank designated as a depository of public funds or in the subtreasury in Chicago. At the end of the month in which the deposits were made the agent drew a check in favor of the Treasurer of the United States for all sums deposited by him during the month and prepared a certificate of deposit evidencing the transfer of the moneys from his account and their deposit to the credit of the United States. Upon receipt by the Treasury Department of such certificates of deposit they were referred by endorsement to the Secretary of the Interior, who in turn referred them to the Commissioner of Indian Affairs for approval and designation of the account to be credited. Upon such approval and designation the certificates were returned to the Treasury Department through the Chief Clerk of the Interior Department. Upon receipt of these certificates in the Treasury Department they were referred to the Auditor of the Interior Department in the Treasury for audit and approval. Upon completion of the audit process the certificates were forwarded to the office of the Secretary of the Treasury to be placed on covering warrants. Except on certain unusual occasions covering warrants were not issued until the end of the quarter during which the certificates of deposit were received. Interest was paid from the date of the covering warrants. Various periods of time elapsed from the time the certificates of deposit were received before the covering warrant was issued, sometimes as much as nearly three months and at other times of only a few days. Later the practice was improved. Checks to the credit of the Treasurer and certificates of deposit were issued at tenday intervals, or more frequently; the certificates of deposit were no longer sent to the Interior Department; and covering warrants were issued more promptly upon receipt of the certificates of deposit, generally, at the end of the month in which received, or at the end of the following month, if the certificates were received in the last few days of the month. Even so, sometimes, although rarely, more than thirty days |