Designing projects for tribal nations may be lucrative, but there may also be unanticipated perils. Sometimes, Native American tribes have specific rules and codes of law. Although there is no uniformity from tribe to tribe, there are often charters, with related compacts and covenants, that form the basis of their laws. Other times, however, unspecified tribal customs prevail, making research into tribal laws difficult and ineffective.
Although we have not seen a large number of claims resulting from tribal projects, the ones we have handled have illustrated some of the unique challenges of working with Native American sovereign nations. In one situation, an architect filed a demand for arbitration to collect outstanding fees, as per the conditions of the signed AIA agreement. The Pueblo removed the claim from arbitration, placed it in the local court and filed a counter-claim for twice as much money. The local court system would not have been favorable to the architect, and the Court of Appeals was comprised of members of the Tribal Council, the same entity that had day to day control of the project. In another situation, a tribal nation retroactively changed its statute of limitations in order to file suit against a design team.
When evaluating the risks of taking on a project for a tribal nation, the following questions should be considered:
- Can you research the law of the tribe in order to provide a reasonable expectation of the results of a dispute?
- Can specific legal codes or interpretations be referenced in the contract?
- Can specific alternative dispute mechanisms be incorporated into the contract (i.e. mediation by a recognized mediation service or AAA arbitration)?
Unless a known body of law and appropriate jurisdiction can be identified in the contract, the imposition of tribal law may be a significant and unmanageable risk.
For more information, see our tribal projects claims study (access limited to policyholders and brokers).
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