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Navajo Supreme Court Confirms Nation’s Regulatory Authority Over Arizona School Districts December 10, 2007

Posted by rezjudicata in Navajo Supreme Court, Tribal Courts.
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Cedar Unified School Dist. v. Navajo Nation Labor Commission, No. SC-CV-53-06, (Nav. Sup. Ct. Nov. 21, 2007).

Issue(s): Administrative Law > Agency Jurisdiction >> Subject Matter; Eleventh Amendment > Tribal Courts >> Immunity; Navajo Law > NPEA >> Contractual Waiver; Navajo Law > Federal Law >> Preemption; Conflict of Laws > Comity

Under the Navajo Preference in Employment Act, employers may not fire employees without “just cause.” The Cedar Unified School District operates on the Navajo Reservation, but is organized under Arizona law. The District fired an employee, allegedly without “just cause.” Does the National Labor Commission (NLC) have subject matter jurisdiction over the employee’s claim under the NPEA? If so, does federal law preempt the NPEA? And, if there is no preemption, should Court defer to Arizona law as a matter of comity?

Yes, no, and no said the Navajo Supreme Court. Nominally, the District is a non-Indian entity. Thus, the District argued that the Navajo Nation must comply with one of the two Montana prongs in order to exercise jurisdiction.* The Court, however, said that under the Nation’s 1868 treaty, the Nation had authority to exclude non-Indians, and therefore the power to regulate non-Indians. Because the Nation reserved this authority by treaty, Montana did not apply. The regulatory authority of the Nation fails only when there is an unmistakable waiver of that authority by the Council. No such waiver existed. Thus, the District must comply with Navajo law.

The District also claimed immunity based on the Eleventh Amendment. Navajo precedent held that the Eleventh Amendment does not grant school districts immunity from NPEA claims. Moreover, the Arizona Supreme Court itself did not consider school districts to be the State for purposes of the Eleventh Amendment. Therefore, the Court rejected the District’s immunity claim.

The District next argued that the employee had contractually agreed to be bound by Arizona law. The NPEA, however, prohibits any attempt to waive its provisions. The Court found that the contract implicitly waived Navajo law (and therefore the NPEA). Under Navajo law, then, the choice of law term was void and unenforceable. Consequently, the NPEA applied to the District and the NLC had subject matter jurisdiction over the claims.

Jurisdiction notwithstanding, the District argued that Title VII of the Civil Rights Act preempted the NPEA. Title VII prohibits discrimination based on “national origin.” The Court refused to comment on whether tribal affiliation was equivalent to “national origin.” Instead, the Court reasoned that the NPEA applies the “just cause” requirement regardless of race, ethnicity, or national origin. Thus, Title VII was inapplicable and did not preempt Navajo law.

Lastly, the District asked the Court to defer the Arizona law. Though the Court recognized the importance of comity, it said the NPEA must be applied in all applicable situations. In effect, the Council had expressly prohibited the Court from deferring to Arizona law under the circumstances. Therefore, Navajo law applied and the NLC could adjudicate the employee’s claim.

*Note on Montana v. United States: In this case the US Supreme Court held that in order to regulate non-Indians, tribes must establish a consensual relationship between the tribe and the non-Indian, or show that the non-Indian’s actions threaten the political integrity, economic security, or welfare of the tribe.

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1. 2/15 Conference Update: MacArthur v. San Juan County « Rez Judicata - February 15, 2008

[…] Justice Yazzie of the Navajo Supreme Court had an interesting take on this case in the context of a case recently decided by the Court. In Cedar Unified School Dist. v. Navajo Nation Labor Commission, Yazzie pointed out that the MacArthur dispute arose out of activities on Utah fee land. If the case had arisen on the “Arizona side” of the reservation, however, any federal court would have to consider the Treaty of 1868, which explicitly grants the Navajo Nation the right to exclude. Id, slip op. at 6, fn. 7. Rez Judicata’s write-up on Cedar Unified is here. […]


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