Carpenter v. Shaw

What happened

The Atoka Agreement with the Choctaw and Chickasaw Tribes was embodied in the Act of June 28, 1898 and ratified on August 24, 1898. It provided that "all the lands allotted shall be non-taxable while the title remains in the original allottees but not to exceed twenty-one years from the date of patent." The petitioners in this case were enrolled Choctaw Indians of less than half blood who had received allotments in Oklahoma under it. The twenty-one-year period had not run out on their lands.

The Indians leased their allotments for oil and gas production and reserved a royalty of one-eighth of the value of the gross production. Oklahoma law taxed the owner of any royalty interest in petroleum and natural gas at 3 percent of the gross value of the royalty, and the state applied that tax to these Indians. Oklahoma's Supreme Court upheld it.

The U.S. Supreme Court reversed. It held that the tax was not a tax on oil and gas severed from the land, but on the right the Indians reserved as lessors and owners of the fee, and that the Agreement's tax exemption forbade it. The Court said tax exemptions secured to Indians by agreement with the national government are to be liberally construed in their favor. It added that such provisions are read "in the sense in which they would naturally be understood by the Indians," citing Jones v. Meehan (1899).

The result kept the state's royalty tax off minerals produced under allotments while the exemption lasted.

Good to know. The Atoka Agreement was with both the Choctaw and the Chickasaw tribes.

Summarized with AI assistance from 3 sources and checked against their words; not yet reviewed by historians or by the nations. Report an error