Court: United States Bankruptcy Appellate Panel for the Ninth Circuit; December 29, 1983; Us Bankruptcy; United States Bankruptcy Court
An appeal was filed against a summary judgment favoring the defendants in an adversary proceeding involving Rocco Zangari and the Cabazon Indian Casino. The Bankruptcy Judge, George, identified a material question of fact that necessitated reversing the lower court's judgment and remanding the case for further proceedings.
The background details the management agreement between Zangari and the Casino, which was signed by the chairman of the Cabazon Band of Mission Indians. Zangari was discharged from his managerial role on November 5, 1981, following legal disputes involving the Casino and the City of Indio. Subsequently, the Casino filed for Chapter 11 bankruptcy, prompting Zangari to contest the Casino's discharge, particularly regarding amounts owed under the agreement. The Casino countered with claims for damages.
The Casino sought summary judgment on two grounds: first, that Zangari's agreement was solely with PN Associates, Inc.; second, that even if the agreement was with the Casino, it was void under 25 U.S.C. § 81, which mandates specific requirements for agreements involving Indian tribes. The trial court assumed the agreement was with the Casino but concluded it was void due to non-compliance with § 81, denying Zangari standing to object to the discharge and granting summary judgment.
The appellate court noted that the lower court's ruling relied primarily on the § 81 arguments rather than the specifics of the agreement itself. This raised concerns since the trial court did not address a key element related to the applicability of § 81, which was implicitly included in the motions and should have been explicitly considered in the judgment.
The Casino, identified as a co-partnership with multiple individuals and the Cabazon Bank of Mission Indians, filed a voluntary Chapter 11 petition signed by non-Indian Project Manager John Paul Nichols. The filing indicates the Casino considers itself an independent entity, separate from the Cabazon Band, as evidenced by its individual Chapter 11 petition rather than one on behalf of the tribe. Although counsel for the Casino argues its agreements are valid and not void under 25 U.S.C. 81, it remains unclear whether these agreements were made with the Casino or another entity, PN Associates, Inc.
California law traditionally views partnerships as extensions of their members unless exceptional circumstances apply, contrasting with tribal corporations. Consequently, the legal status and protections surrounding partnerships involving tribal members differ from those afforded to tribal corporations. While partnerships can own property and sue collectively, the rights of individual partners do not necessarily transfer to the partnership, meaning the bankruptcy of one partner doesn't absolve the partnership or other partners from debts.
The case presents a factual question regarding the Casino's relationship with the Cabazon Band, with potential implications for the liability of the tribe concerning partnership debts. The lower court's summary judgment based on 25 U.S.C. 81 is deemed erroneous, as some partners do not receive the protections granted by this statute. The panel reverses the summary judgment and remands the case for further examination of these issues.
