## Facts

- In an 1894 agreement with the United States, the Nez Perce Tribe ceded 549,559 acres from the western portion of its reservation to the federal government.
- The United States paid $2.97 per acre for the ceded lands.
- $1,000,000 of the purchase price was placed in a trust fund for the Tribe that earned 5% interest.
- After the acquisition, the government quickly resold the lands to settlers, generally for prices reported between $3.75 and $5.00 per acre.
- Roughly seventy years later, the Tribe filed a claim with the Indian Claims Commission under the Indian Claims Commission Act, alleging the government paid an unconscionably low price in 1894 and seeking additional compensation.
- The Tribe argued the 1894 fair market value was approximately $12 per acre.
- The Commission received sharply conflicting valuation testimony: one expert estimated $11.89 per acre; another estimated $1.29 per acre.
- The valuation analysis considered multiple factors, including: bulk-sale conditions; the effect of the government’s rapid resale program; costs of subdivision and disposition; the land’s varying suitability for different uses; proximity to towns and transportation balanced against remoteness from major population centers; comparable sales; and the nationwide economic depression in 1894.
- Based on the record and its own calculations, the Commission found the land’s 1894 fair market value to be $4 per acre.
- Even with that value finding, the Commission concluded the difference between $4.00 and $2.97 per acre was not so extreme as to constitute “unconscionable consideration” or a lack of “fair and honorable dealings,” and it denied additional recovery.
- The Tribe appealed the Commission’s denial to the United States Court of Claims.

## Issues

1. Whether the Indian Claims Commission’s finding that the 1894 fair market value of the ceded lands was $4 per acre should be set aside on review.
2. Whether paying $2.97 per acre for land found to be worth $4 per acre in 1894 constituted “unconscionable consideration” or otherwise failed the “fair and honorable dealings” standard under the Indian Claims Commission Act.

## Decision

- The Court of Claims affirmed the Indian Claims Commission’s decision denying additional compensation.
- The court sustained the Commission’s $4-per-acre valuation as a permissible fact finding based on the full record, despite the wide spread in expert opinions.
- The court agreed that the roughly $1.03-per-acre difference between the amount paid and the found fair market value did not meet the Act’s high threshold for “unconscionable consideration” or unfair dealing.
- The court treated the government’s prompt resale at higher prices as relevant background, but not conclusive proof of unfairness, given differences between a single bulk cession and later subdivided sales and the government’s costs of preparing and marketing the land.

## Legal Principles

- On review of Indian Claims Commission determinations, historical fair market value is primarily a question of fact; the Commission’s finding will be upheld when supported by substantial evidence in the record.
- “Unconscionable consideration” under the Indian Claims Commission Act requires more than a showing that the government paid less than fair market value; the disparity must be exceptionally large in context.
- Evidence that the government later resold tribal lands for more than it paid does not, by itself, establish unconscionability, particularly where later sales involved subdivision, disposition expenses, and different market conditions than a bulk cession.
- In valuing large land cessions, the Commission may consider factors affecting a bulk transaction (including possible volume pricing), the property’s mixed quality and uses, access to transportation and towns, comparable sales data, and macroeconomic conditions at the time of taking.

## Conclusion

Nez Perce Tribe of Indians v. United States holds that the Court of Claims would not disturb the Indian Claims Commission’s supported finding that the Tribe’s 1894 ceded lands were worth $4 per acre, and it further holds that paying $2.97 per acre—though below that value—was not so grossly inadequate, in context, as to amount to unconscionable consideration or a failure of fair and honorable dealings under the Indian Claims Commission Act; therefore, the denial of additional compensation was affirmed.


Nez Perce Tribe of Indians v. United States, 176 Ct. Cl. 815 (1966)