A federal statute which extends state workers' compensation coverage to employees of
private employers doing work on federal lands, 40 U.S.C. Sec. 290, also applies in Navajo
Indian Country. The statute does not apply to employees of tribal governments or
The federal statute does not preclude the exercise of civil jurisdiction over a personal injury
claim which has already passed through a state's workers' compensation program. State
workers' compensation remedies are entitled to comity recognition only, and 40 U.S.C. Sec.
290 does not divest the Navajo Nation courts of jurisdiction over a personal injury claim
where the plaintiff has already recovered under a state workers' compensation statute.
The problem of whether a state workers' compensation award is entitled to recognition is a
question of comity, Navajo Nation public policy, and Navajo common law. Such
jurisdiction should be exercised with restraint, and a personal injury suit should not
supplement a state workers' compensation award unless it is substantially different from
what Navajo common law would consider adequate.
Before exercising jurisdiction, the district court must consider the factual issues of waiver,
equitable estoppel, and the available remedy under Navajo common law. A litigant may
waive the right to bring a personal injury action if there was (1) a distinct waiver of the right;
(2) full knowledge of the right which is given up; (3) knowledge of the right; (4) a plain
appearance the person intends to give up the right; and (4) a voluntary and intentional
surrender of the right. The Navajo Nation recognizes equitable estoppel, which prevents a
party claiming a right against another who in good faith relied on the party's prior conduct
and changed position for the worse. The Navajo common law remedy is nalyeeh, which is
a flexible concept of distributive justice to be determined by the district court.
(Note: This is not an official syllabus. This copy of the opinion to follow has brackets to indicate
the page numbers of the original opinion, and the abbreviation "Sec." is used in place of the section
Before YAZZIE, Chief Justice, SLOAN* and FERGUSON* Associate Justices (* by special
Appeal from a decision of the Kayenta District Court, No. KY-TV-040-97, the Honorable Manuel
Daniel M. Rosenfelt, Esq., Albuquerque, New Mexico for the Appellant; and C. Benson Hufford,
Esq., Flagstaff, Arizona, for the Appellees.
Opinion delivered by SLOAN, Associate Justice.
This is an appeal from the Kayenta District Court's dismissal of a personal injury action. The
district court held that to allow Plaintiff-Appellant, Jolene Nez ("Nez"), to pursue a personal injury
complaint against her employer, Defendant-Appellee, Peabody Western Coal Company
("Peabody"), after she had received workers' compensation benefits under the Arizona Workers'
Compensation Program for the same injuries, would constitute unjust enrichment. We reverse and
remand for further proceedings consistent with this opinion.
On June 12, 1995, Nez, a member of the Navajo Nation, was injured during her employment at
Peabody's Black Mesa Mine near Kayenta, Arizona within the Navajo Nation. Nez suffered
permanent  facial disfigurement after chemical solvents splattered on her face while she cleaned
paint brushes for Peabody. Nez filed a claim for benefits with the Arizona Industrial Commission
("Commission") under the Arizona Workers' Compensation Act ("Act"). On April 5, 1996, the
Commission awarded Nez benefits for medical costs and lost wages, and $7,530.77 for permanent
disfigurement of her face.
In the spring of 1996, Nez requested that her claim be reopened so she could receive additional
medical treatment for areas of pigmentation loss on her skin. Her workers' compensation carrier
authorized additional medical care and compensation for time lost from her job. The new medical
treatment was unsuccessful. On March 13, 1997, the Commission closed Nez's case. The
Commission found no change had occurred in her skin condition since the formal award of April
5, 1996, and therefore her total award for the permanent disfigurement of her face remained at
On April 19, 1997, Nez brought a personal injury claim against Peabody in the Kayenta District
Court. She sought damages for emotional distress, pain and suffering, diminution of the quality of
her life, permanent facial disfigurement and any other damages not covered by the Commission's
award for her June 1995 injury. Peabody moved to dismiss Nez's action for lack of subject matter
On July 25, 1997, the district court ruled that "this action is not barred for a lack of jurisdiction,"
but dismissed Nez's action finding that this "suit would cause unjust enrichment and violate the
legitimate expectations of both the employer and the employee under the workers' compensation
scheme which the  plaintiff elected to use.' Nez v. Peabody Western Coal Co., Order to Dismiss
at 3, No. KY-TV-040-97 (decided July 25, 1997). The district court explained its decision in terms
While the state law of the election of the remedy is a statutory matter which does not bind this court, the same equitable principle applies as a matter of Navajo Nation law. Where an applicable statutory scheme under state law is a remedy available to the plaintiff, and that plaintiff selects the remedy, it would be inequitable to allow a separate personal injury action under Navajo Nation law.
Nez appealed, arguing that no Navajo legal principle of equity can deny her action for a personal
injury after she previously received workers' compensation benefits. Peabody argues that the
Navajo Nation must recognize the exclusive remedy provision of the Arizona Act, and that, even
if the Navajo Nation is not required to recognize the Arizona exclusive remedy provision, Nez
should be equitably estopped from bringing her personal injury action.
Of the issues raised by the parties, we need only address two.
1. Whether the Arizona Industrial Commission's award of workers' compensation benefits pursuant
to 40 U.S.C. Sec. 290 precludes the Navajo Nation courts from assuming subject matter jurisdiction
over a personal injury claim arising from the same injuries.
2. Whether the Kayenta District Court erred in dismissing the action on equity grounds.
We hold that Arizona's application of its workers' compensation laws does not preclude the Navajo
Nation courts from  assuming jurisdiction over Nez's personal injury claim. We further hold that
the district court abused its discretion in dismissing Nez's action on equity grounds.
In 1936, the United States Congress enacted 40 U.S.C. Sec. 290. Section 290 was passed to "fill a
conspicuous gap in the workmen's compensation field." See, e.g., Swatzell v. Industrial Comm'n
of the State of Arizona, 277 P.2d 244, 248 (Ariz. 1954) (quoting S.R. No. 2294, 74th Congress, 2d
Session). Prior to the passage of Section 290, employees working on federal lands for private
employers were not covered by any workers' compensation program. They were not covered by the
United States Employees' Compensation Act, because it covered only those directly employed by
the Federal Government. Nor where they covered by any state compensation program, since such
acts only protected employees on state lands. Id.
Section 290 has been interpreted to allow states to extend their workers' compensation coverage to
employees of private employers operating on Indian reservations, but not to employees of tribal
governments or enterprises. Tibbets v. Leech Lake Reservation Business Committee, 397 N.W.2d
883 (Minn. 1986) (holding that Sec. 290 does not allow state workers' compensation laws to apply
to employees of the federal government working on Indian reservations); and Begay v. Kerr-McGee
Corp., 682 F.2d 1311 (9th Cir. 1982) (holding that Sec. 290 allows state workers' compensation laws
to apply to employees of private employers on Indian  reservations). We thus acknowledge that
40 U.S.C. Sec. 290 allows the Arizona Industrial Commission to award benefits to employees
injured while working for private employers within the territory of the Navajo Nation.
The question before us, however, is not whether 40 U.S.C. Sec. 290 extends state jurisdiction into
tribal land, but whether it precludes the Navajo Nation courts from exercising jurisdiction over a
personal injury claim which has already passed through a state's workers' compensation program.
Allowing a state program to compensate victims of workplace injuries on the reservation is vastly
different than divesting the Indian nation courts of jurisdiction over an entire area of the law. Indian
nation courts are central to tribal sovereignty, and divestiture of tribal jurisdiction is not to be
In determining the extent of Indian nation court jurisdiction, we assume that Indian tribes retain all
those aspects of sovereignty which have not been withdrawn by federal statute or treaty or by virtue
of their dependent status. Iowa Mutual Ins. Co. V. La Plante, 480 U.S. 9, 14 (1987). Thus, there
is a presumption that the Navajo Nation courts retain civil jurisdiction over the activities of non-Indians on reservation lands. Id. To determine if Sec. 290 "rebuts" the presumption of Navajo
Nation jurisdiction, we follow the test of jurisdiction adopted by the United States Supreme Court
in National Farmer's Union Ins. Co. V. Peabody Coal Co., 471 U.S. 845, 855-56 (1985). See Pela
v. Peabody Coal Co., No. A-CV-18-89 slip op. At 4, (decided September 28, 1990) ("We agree with
the approach pronounced by the United States Supreme Court [in National Farmer's Union] to 
determine tribal court jurisdiction.") In National Farmer's Union, the United States Supreme Court
noted, "[t]he existence and extent of a tribal court's jurisdiction will require a careful examination
of tribal sovereignty, the extent to which the sovereignty has been altered, divested, or diminished,
as well as a detailed study of relevant statute, Executive Branch Policy as embodied in treaties and
elsewhere, and administrative or judicial decisions." 471 U.S. at 855-56.
We first consider the text and purposes of 40 U.S.C. Sec. 290. Generally a federal law should not
be interpreted as divesting Indian nation courts of jurisdiction absent an express declaration of such
an intention by Congress. Littell v. Nakai, 344 F.2d 486, 489 (9th Cir. 1965). We find that the text
of Sec. 290 to be silent as to its intended effect on the jurisdiction of Indian nation courts. Nor does
the express purpose of Sec. 290 indicate a congressional desire to divest Indian nation courts of
jurisdiction; as explained above, the purpose of Sec. 290 was to ensure that workers who were
previously "slipping-through-the-cracks" between state and federal workers' compensation systems
received coverage. Extending the scope of state law does not necessitate a corresponding reduction
in the jurisdiction of Indian nation courts. Finally, we find the date of passage or Sec. 290 to be
partially illustrative of Congress' intentions; Congress passed Sec. 290 in 1936, over two decades
prior to the establishment of the Navajo Nation Courts in 1959.(1) We find it obvious that Congress
could not have intended to divest jurisdiction from a court system that did not yet exist.
 We also find the states' treatment of the exclusivity remedy to be illustrative. A workers'
compensation award in one state does not preclude a common-law action based on the same facts
against the employer in a second state. This is true even if the first state claims that its workers'
compensation statute is the exclusive remedy available. See Carroll v. Lanza, 349 U.S. 408 (1955)
(holding that full faith and credit clause does not compel one state to enforce the exclusive remedy
provision of another state's workers' compensation law). See also Garcia v. American Airlines, Inc.,
12 F.3d 308 (1st Cir. 1993) (holding that the forum state had jurisdiction over an employee's
common law tort suit even after the employee had received benefits under another state's workers'
compensation program). Generally, a state court will enforce another state's exclusive remedy
provision, but it will do so for discretionary reasons of comity and not because it is required to do
so. Garcia, 12 F.3d at 312.
We thus conclude that 40 U.S.C. Sec. 290 does not divest the Navajo Nation courts of jurisdiction
over personal injury claims brought on the basis of injuries for which the plaintiff has already
recovered under a state workers' compensation statute.
The fact that the Navajo Nation courts have jurisdiction does not necessarily indicate that that
jurisdiction should be exercised. We must consider, as a matter of comity to Arizona, and as a
matter of Navajo public policy and Navajo common law, whether the exercise of jurisdiction over
personal injury claims based on injuries already heard by the Arizona Industrial Commission
undermines the workers' compensation regime. We recognize that workers' compensation systems
represent a trade-off  on which all parties - both workers and employees - rely. Workers receive
benefits without placing their own contributory fault at issue and employers are protected from
protracted litigation and potentially devastating damage awards. We also recognize that economic
development is important to the Navajo Nation, and that businesses seeking to operate in the Navajo
Nation desire a legal environment that is predictable and fair.
We are thus faced with a delicate balancing test. On one hand, the Navajo Nation courts have
jurisdiction over civil disputes on the Navajo Nation and a duty to insure that parties injured on the
Navajo Nation are treated justly and in accordance with Navajo custom and tradition. On the other
hand, we recognize that Arizona has a legitimate interest in the integrity of its workers'
compensation program, and that private employers have an interest in predictable procedures.
In recognition of this balance, we hold that, while Navajo Nation courts have jurisdiction over
claims such as Nez's, such jurisdiction should be exercised with restraint. The Navajo Nation courts
should not permit personal injury suits as a "supplement" to state workers' compensation awards
unless it is clear that the compensation received under the workers' compensation regime is
substantially different from what Navajo common law would consider adequate. We anticipate that
the number of instances where a personal injury remedy will be necessary to supplement a state
workers' compensation award will be rare; thus, the integrity of the Arizona workers' compensation
regime will not be significantly undermined. Whether Nez's award under Arizona's program is
substantially different from what would be adequate under Navajo common law is a matter of fact
to be determined by the  district court.
We further hold that before proceeding to the merits of Nez's case, the district court should consider
several factual "threshold" issues.
Under Navajo Nation law a party may waive its right to pursue a remedy in court. The district court
must consider whether Nez acted in a manner that operated to waive her right to bring this personal
injury action in the Navajo Nation courts.
Waiver under Navajo common law requires: (1) a distinct waiver of a right; (2) full knowledge of
a right which is given up; (3) the fact the person giving the thing up knows of his right; (4) a plain
appearance that the person intends to give up the rights; and (5) a voluntary and intentional surrender
of rights. In re Estate of Tsosie, 4 Nav. R. 198, 200 (W.R. Dist. Ct. 1983).
The doctrine of equitable estoppel prevents a party from claiming a right against another person who
in good faith has relied on the party's prior conduct and has changed his position for the worse. The
doctrine of equitable estoppel is recognized by the Navajo Nation courts. Tafoya v. Navajo Nation
Bar Association, No. A-TV-16-88, slip op. at 4 (decided Aug. 9, 1989); In re Practice of Battles,
3 Nav. R. 92, 98 (Neswood, J. concurring).
The district court must consider whether, as a factual matter, Peabody was disadvantaged by Nez's
resort to the Arizona workers' compensation system and delay of two years before filing a personal
If, after consideration of the threshold issues described above, the district court reaches the merits
of Nez's claim, it must determine whether, as a factual matter, the remedy Nez received from the
Arizona workers' compensation regime is substantially different from the remedy compelled by
Navajo common law. Under Navajo Common law, damages in personal injury actions are measured
by nalyeeh. See Benally v. Navajo Nation, 5 Nav. R. 206 (1986). Nalyeeh has been interpreted to
include a broad range of damages, including claims such as mental anguish and pain and suffering.
However, nalyeeh is a flexible concept of distributive justice, and it is possible that Navajo common
law prevents plaintiffs from seeking to recover twice for the same injury. How nalyeeh should be
apply to Nez's situation is a matter to be determined by the district court.
We thus reverse the district court and remand this case for disposition consistent with this opinion.
Filed this 22nd day of September 1999
Robert Yazzie, Chief Justice of the Navajo Nation
Allen Sloan, Associate Justice
Lorene B. Ferguson, Associate Justice
1. Tom Tso, The Process of Decision Making in Tribal Courts, 31 Ariz. L.R. 225, 230 (1989).
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