New Mexico: Arbitrators ask court to stay out of proceedings

Deborah Baker

Wednesday, March 1, 2000 | 12:30 p.m.

SANTA FE - Arbitrators in a casino payments dispute between New Mexico and Indian tribes asked the state Supreme Court today not to intervene, saying it would be a "serious injustice."

Attorney General Patricia Madrid wants the court to prevent the arbitrators from ruling on the legality of casino payments. She said such a ruling would exceed the arbitrators' authority.

Arbitration scheduled for last week remains on hold while the court decides whether to step in.

The justices made no decision after a hearing today, and did not indicate when they would.

A lawyer for the American Arbitration Association said the state was trying to derail the proceedings because it anticipated an unfavorable ruling.

"It's premature for any court to do anything. The arbitrators haven't acted," said Albuquerque lawyer Robert Taichert.

He said courts historically have stayed out of arbitration proceedings and it would be a "terrible precedent" for the New Mexico court to do otherwise.

"It would be a serious injustice for this court to inject itself into this arbitration process," he said.

The arbitration stems from the tribes' refusal to pay the state the 16 percent of slot machine proceeds required by 1997 agreements they signed.

The tribes want the arbitrators to find that the revenue sharing rate is illegal under federal law, and therefore unenforceable.

But Deputy Attorney General Stuart Bluestone said the state law that created the gambling agreements - and provided for arbitration to resolve disputes - gives the three arbitrators only limited authority.

They can decide, for example, that a tribe hadn't paid what it owed, Bluestone said.

But the law "does not authorize the arbitrators to decide the legality of the compacts themselves, or the legality of the 16 percent revenue sharing," he told the court.

Those legal questions should be answered by a court, "and not by private arbitrators behind closed doors," he said.

He said a ruling from the arbitrators "totally upsets the apple cart" as the Legislature and tribes try to reach agreement on new compacts with lower payment rates.

Justice Gene Franchini cautioned Bluestone that the state's highest court may be reluctant to jump into the dispute at this point.

"This court ... has been slow to act unless and until we have to. We're not self-starters," he said.