Protecting Lease Transactions in Indian Areas Robert S. Bernstein and Kirk B. Burkley
Bernstein Law Firm, P.C.
Pittsburgh, Pennsylvania
This article appeared in the Equipment Leasing Newsletter , January 2003
When choosing to do business in Indian Country lessors need to be aware of a couple important issues when determining how to protect their interest in property. Lessors first need to discover where (and how) to record notice of their interest in property. In most cases this means where to file UCC financing statements. Furthermore, lessors must analyze the appropriate procedure for recovering their property if a lessee defaults on the lease. The outcome of these issues varies from tribe to tribe and the specific tribal code must be examined before entering into a transaction.
Similar to a state, a tribe may regulate, through taxation, licensing, or other means, the activities of nonmembers who enter consensual relationships with the tribe or its members, through commercial dealing, contracts, leases, or other arrangements. Id. Because of this tribal autonomy, before entering into a lease agreement with an entity located in Indian Country, a lessor should examine how that particular tribe treats secured transactions. This done, if tribal law is unclear or different than the law under which the lessor normally operates, the transaction has to be fully analyzed to determine the risks and the rewards. A large value, but marginally profitable transaction may very well be discouraged. | |
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