Supreme Court rules no fiduciary exception in trust between US, Native Americans

[JURIST] The US Supreme Court [official website, JURIST news archive] Monday ruled [opinion, PDF] in United States v. Jicarilla Apache Nation [Cornell LII backgrounder] that in a trust relationship between the government and a Native American tribe the government does not have to release confidential communications with its attorney under the "fiduciary exception" to attorney-client privilege. The Jicarilla Apache Nation [official website] attempted to compel through discovery certain documents to prove its breach of trust action against the government, but the government argued that some of the documents were protected by attorney-client privilege. The Supreme Court ruled 7-1, overturning the lower appeals court, that the government was entitled to protection under attorney-client privilege despite is position as trustee for the benefit of the tribe. The tribe argued that the common-law "fiduciary exception" should apply, which makes communications between the trustee and the attorney over management of the trust corpus discoverable by the beneficiaries. The opinion of the court by Justice Samuel Alito reasoned that the government acting as a trustee is unlike a trustee in a private trust created at common law because the government is acting within statutory authority granted to it by Congress. The fiduciary exception is based on the idea that the trustee is acting on behalf of the "real client" the beneficiaries. The communication between the government and its attorneys over management of this trust however, is based on the government's sovereign interest to carry out federal law, and not solely for the benefit of the tribe. Justice Sonia Sotomayor was the lone dissent arguing that the government is fulfilling the traditional fiduciary role as a trustee for the benefit of the tribe. Further she argued that the exception should exist since Rule 501 of the Federal Rules of Evidence [text] says that the government's privilege is to be informed by the common law. Justice Elena Kagan did not take part in the decision.

The Jicarilla Apache Nation reservation contains natural resources that are developed by the Department of the Interior [official website] with the proceeds held by the US in trust for the tribe. The tribe brought a claim against the government for breach of trust seeking monetary damages for mismanagement of trust funds. The tribe had argued [JURIST report] that no trustee in such a situation should be entitled to hide behind the privilege, that the beneficiary of a trustee should be entitled to see the communications of the trustee with an attorney over the management of the trust to see if the trustee actually followed that advice. The Supreme Court overturned the US Court of Appeals for the Federal Circuit, which held [opinion, PDF] that the government cannot deny the tribe's request to discover such communications, adopting a fiduciary exception in tribal trust cases.

 

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