As discussed in an earlier post in this series, a key feature of most governments’ sovereignty is “sovereign immunity”—or immunity from any lawsuits to which the government has not consented. This is an ancient legal concept arising from the idea that the monarch can do no wrong, and therefore cannot be sued in his or her own courts—unless the sovereign consents. This presents an issue for parties entering these contracts.
In order to encourage normal business transactions, and provide contractors with a means of resolving disputes, the federal government has a “standing” limited waiver on the books, the Tucker Act, 28 U.S.C. Section 1491. This allows suits under contracts to which the federal government is a party. The same goes for many states, including Minnesota—see, for example, Minnesota Statute Section 3.751, Contract Claims, Subdivision 1, Waiver of Immunity.
But tribes usually do not have blanket, limited-waiver rules like these on the books, and each tribe has its own body of law. So how do you get an enforceable dispute-resolution clause in a tribal-government contract? The answer is twofold: (1) careful negotiation of the dispute-resolution clause; and (2) a limited waiver of sovereign immunity in the contract itself. Tribal law often also requires approval via written resolution of the tribal council or other governing body. Especially on larger deals, this process can take time, requiring research on tribal law and contracting procedures. The dispute-resolution mechanism itself might require both compromise and creativity. Often, these discussions involve larger topics of tribal sovereignty, and the many connections between government and culture in Indian Country.
At DLO, we love helping tribes and their business partners navigate these and other contractual issues, and we are proud to be part of successful tribal projects throughout the country. To learn more, contact Sara at firstname.lastname@example.org.