Hamlin v. Transcon Lines

701 P.2d 1139, 1985 Wyo. LEXIS 496

Opinions

ORDER DENYING PETITION FOR REHEARING

THOMAS, Chief Justice.

This matter comes here upon the State’s Petition for Rehearing, even though the State is the successful party in this appeal. While it is indeed unusual for the successful party to petition this Court for a rehearing, we find the State to have misconstrued our opinion, and, because it is the duty of the office of the Attorney General to administer the Wyoming Governmental Claims Act, we will respond to the petition so that all misconceptions or similar misunderstandings may be laid to rest.

The Court, having carefully considered said Petition, and being fully advised in the premises, finds that the State has failed to demonstrate that this Court has in any way misinterpreted the Wyoming Governmental Claims Act, §§ 1-39-101 through 1-39-119, W.S.1977, 1984 Cum.Supp., and its relation to Art. 10, § 4 of the Wyoming Constitution and § 27-12-103(a) of the Wyoming Worker’s Compensation Act, §§ 27-12-101 through 27-12-804, W.S.1977.

The State of Wyoming takes the position that this Court’s opinion frustrates the purposes of the Governmental Claims Act by denying aid to those injured by public employees unless such injured person first obtains and satisfies his or her judgment against the negligent employee. It is difficult for this Court to understand how the State’s attorney could possibly read the Court’s opinion to hold for such a conclusion. The State’s interpretation conflicts with the explicit language of the Court’s opinion which recognizes that the Governmental Claims Act authorizes a direct claim against the State in favor of all persons injured by negligent State workers except in those situations where the injured party is also an employee of the State and covered by worker’s compensation. The Court’s opinion says:

«* * * [Bjecause the legislature felt that the citizens of Wyoming would best be served by structuring a method whereby they could, in specific instances, bring tort and contract actions against the State and its employees — it enacted the Wyoming Governmental Claims Act. As noted, the purpose of the Act is to ‘balance the respective equities between persons injured by governmental actions and the taxpayers’ (emphasis added). Thus the legislature’s intended purpose is to waive sovereign immunity of the State and its employees in tort and contract — in those certain specified instances which are contemplated by the Act and only to the extent contemplated.” (Emphasis added.) Hamlin v. Transcon Lines, Wyo., 697 P.2d 606, 612-613 (1985).

The Court’s opinion, dated April 1, 1985, makes it clear that in every instance in which the injured party is not a governmental employee covered by the Worker’s Compensation Act, he or she is authorized to bring an action in tort directly against the state or any other governmental entity by which the tortfeasor is employed. Such a plaintiff is not only entitled to seek a judgment against the State or other governmental entities for the negligence of their employees, but the plaintiff may also proceed to obtain satisfaction of that judgment in full from the resources of the governmental entity which employed the tortfeasor. The Governmental Claims Act and the doctrine of respondeat superior compel this conclusion.

As the Court’s opinion clearly holds, it is only in those situations where the injured governmental employee-plaintiff is covered by worker’s compensation that the exclusive-remedy provisions of the worker’s compensation laws preclude a direct action in tort against the employer-governmental entity. The Worker’s Compensation Act and the waiver-of-immunity provisions of the Governmental Claims Act do, however, permit the injured governmental employee to structure a claim against his or her co-employee provided the claimant can prove culpable negligence. Section 27-12-103(a), W.S.1977. Thus, the very narrow fact situations to which the holding of the Court’s opinion in the case at bar would apply — except where the plaintiff chooses to bring suit against the governmental employee only — are those in which the injured person is an employee of a governmental entity and is covered by worker’s compensation. In these circumstances, as the Court’s opinion specifically holds, the employee does not have a cause of action against the governmental-entity employer because of the exclusive-immunity provisions of the worker’s compensation law, § 27-12-103(a), and for the further reason that the injured party is not a third-party beneficiary of the statutory-indemnity agreement contemplated by § l-39-104(b), since such injured person is not one against whom “liability is alleged.”

The State, in its brief in support of the petition for rehearing, strenuously objects to the Court’s holding that a party injured by governmental action may assert a claim against the public employee responsible for that injury. The principal contention underlying all of the State’s arguments is that the Governmental Claims Act recognizes only one claim or cause of action for the redress of governmental wrongs: namely, a claim against the governmental entity itself. The State directs our attention to § l-39-104(a), which provides in part:

“(a) A governmental entity and its public employees while acting within the scope of duties are granted immunity from liability for any tort except as provided by W.S. 1-39-105 through 1-39-112.”

From this it is argued that, since each of the statutory exceptions to absolute immunity cited in § l-39-104(a) provides that the “governmental entity is liable” — no mention being made of the public employee’s liability — public employees acting within the scope of their duties therefore enjoy absolute immunity from suit for any and all wrongs they commit.

The express language of the Governmental Claims Act itself refutes this notion. Preliminarily, we recall the elementary rule of statutory interpretation that all portions of an act must be read in pari materia, and every word, clause and sentence of it must be considered so that no part will be inoperative or superfluous. Attletweedt v. State, Wyo., 684 P.2d 812, 813 (1984); Haddenham v. City of Laramie, Wyo., 648 P.2d 551 (1982). Also applicable is the oft-repeated rule that this Court must assume that the legislature did not intend futile things. Thomson v. Wyoming In-stream Flow Committee, Wyo., 651 P.2d 778 (1982); Haddenham v. City of Laramie, supra; Yeik v. Department of Revenue and Taxation, Wyo., 595 P.2d 965 (1979); DeHerrera v. Herrera, Wyo., 565 P.2d 479 (1977); Kuntz v. Kinne, Wyo., 395 P.2d 286 (1964); Brinegar v. Clark, Wyo., 371 P.2d 62 (1962). If we were to adopt the State’s reasoning that governmental employees enjoy complete immunity under the Governmental Claims Act, we would render superfluous and futile numerous sections of the Governmental Claims Act, including the indemnification provisions of § 1 — 39—104(b):

“(b) When liability is alleged against any public employee, if the governmental entity determines he was acting within the scope of his duty, whether or not alleged to have been committed maliciously or fraudulently, the governmental entity shall provide a defense at its expense. A governmental entity shall save harmless, and indemnify its public employees against any tort claim or judgment arising out of an act or omission occurring within the scope of their duties.” (Emphasis added.)

This section plainly recognizes that public employees may be subject to tort claims and judgments as a result of their work-related activities.

Section l-39-116(b) provides that the judgment or settlement obtained pursuant to the Governmental Claims Act, not the Act itself, bars further action by the claimant against the responsible employee:

“(b) The judgment in an action or a settlement under this act constitutes a complete bar to any action by the claimant, by reason of the same transaction or occurrence which was the subject matter of the original suit or claim, against the governmental entity or the public employee whose negligence gave rise to the claim.” (Emphasis added.)

The applicable statute of limitations, § 1-39-114, recognizes the validity of claims against governmental employees:

“Except as otherwise provided, actions against a governmental entity or a public employee acting within the scope of his duties for torts occurring after June 30, 1979 which are subject to this act shall be forever barred unless commenced within one (1) year after the date the claim is filed pursuant to W.S. 1-39-113. In the case of a minor seven (7) years of age or younger, actions against a governmental entity or public employee acting within the scope of his duties for torts occurring after June 30, 1979 which are subject to this act are forever barred unless commenced within two (2) years after occurrence or until his eighth birthday, whichever period is greater. * * *” (Emphasis added.)

Finally, § l-39-117(b) establishes that venue for claims brought under the Act shall be in the county where the defendant public employee resides:

“(b) Venue for any claim against the state or its public employees pursuant to this act shall be in the county in which the public employee resides or the cause of action arose or in Laramie county. Venue for all other claims pursuant to this act shall be in the county in which the defendant resides or in which the principal office of the governmental entity is located.” (Emphasis added.)

We cannot agree that the legislature enacted the foregoing provisions with the intent that injured citizens be forever barred from bringing claims against governmental employees.

The intent of the legislature in enacting the Governmental Claims Act appears in § 1-39-102:

“(a) The Wyoming legislature recognizes the inherently unfair and inequitable results which occur in the strict application of the doctrine of governmental immunity and is cognizant of the Wyoming supreme court decision of Oroz v. Board of County Commissioners, 575 P.2d 1155 (1978). It is further recognized that the state and its political subdivisions as trustees of public revenues are constituted to serve the inhabitants of the state of Wyoming and furnish certain services not available through private parties and, in the case of the state, state revenues may only be expended upon legislative appropriation. This act is adopted by the legislature to balance the respective equities between persons injured by governmental actions and the taxpayers of the state of Wyoming whose revenues are utilized by governmental entities on behalf of those taxpayers. This act is intended to retain any common law defenses which a defendant may have by virtue of decisions from this or other jurisdictions.

“(b) In the case of the state, this act abolishes all judicially created categories such as ‘governmental’ or ‘proprietary’ functions and ‘discretionary’ or ‘ministerial’ acts previously used by the courts to determine immunity or liability. This act does not impose nor allow the imposition of strict liability for acts of governmental entities or public employees.”

The Court’s opinion in this appeal makes it clear that, in adopting the Governmental Claims Act, the legislature recognized and embraced the curtailment of governmental immunity initiated by the judiciary. The legislature sought to afford a remedy to persons injured by negligent public employees, while avoiding the repeated litigation of the question of governmental immunity. In the case of the State, the legislature abolished such classifications as “discretionary” and “ministerial,” previously used by the courts to determine whether governmental employees or entities were exposed to suit. The legislature expressly intended that the Act should not impose strict liability upon public employees or the governmental entities, but that all defendants should retain their tort defenses developed at common law.

To accomplish these stated purposes, the legislature granted immunity to governmental entities and their employees except for certain specified torts, § 1-39-104(a). Except for the tortious conduct of law-enforcement officers, all of the torts excepted from the protection of absolute immunity involve negligent conduct by public employees acting within the scope of their employment. For example, § 1-39-105 provides:

“A governmental entity is liable for damages resulting from bodily injury, wrongful death or property damage caused by the negligence of public employees while acting within the scope of their duties in the operation of any motor vehicle, aircraft or watercraft.”

Thus, under § l-39-104(a), supra, the negligent operation of an automobile by a public employee in the scope of his or her duties is tortious conduct excepted from the shield of governmental immunity whether raised by the government or the employee. The language of § 1-39-105, supra, underscores the governmental entity’s exposure to suit but nothing in the statute relieves the employee from the liability imposed by § l-39-104(a) for such tort. This reading of the Governmental Claims Act has been accepted without question by scholars since the Act’s inception:

“If the suit is brought under one of the enumerated exceptions in section 1-39-105 through 112, the employee has no immunity and any defenses are grounded in the law of negligence. This lack of immunity should not be surprising, since most public employees would probably agree that they should not be treated differently from other individuals for injuries caused by such activities as driving a car, piloting an airplane, or maintaining a building or street.

“Although the employee has no immunity he is not personally liable as long as the activity was within the scope of his duties. Section l-39-104(b) obligates the governmental entity, to provide a defense and indemnify the employee for any tort claim or judgment.” Comment, Wyoming’s Governmental Claims Act-Sovereign Immunity With Exceptions — A Statutory Analysis, 15 Land & Water L.Rev. 619, 636 (1980).

This conclusion, that public employees are susceptible to suit under the Governmental Claims Act, finds support in our decisions rendered after the adoption of the Act. Lafferty v. Nickel, Wyo., 663 P.2d 168 (1983); Kimbley v. City of Green River, Wyo., 663 P.2d 871 (1983).

Although the Governmental Claims Act permits an injured party to bring suit against the responsible governmental employee, the Worker’s Compensation Act limits that right where the plaintiff is also a governmental employee eligible for worker’s compensation benefits. Section 27-12-103(a) provides:

“(a) The rights and remedies provided in this act [§§ 27-12-101 through 27-12-804] for an employee and his dependents for injuries incurred in extrahazardous employments are in lieu of all other rights and remedies against any employer making contributions required by this act, or his employees acting within the scope of their employment unless the employees are culpably negligent, but do not supersede any rights and remedies available to an employee and his dependents against any other person.”

The State expresses concern that in those instances where an injured State employee, covered by worker’s compensation, succeeds in obtaining judgments by establishing the culpable negligence of his fellow employee, the State will be forced to pay for the injury twice in apparent derogation of the Wyoming Constitution, Art. 10, § 4. That is, it is the petitioner’s contention that the State employer would, in these circumstances, be forced to pay the claimant directly through worker’s compensation benefits and indirectly through indemnification of the culpably negligent co-employee. This argument ignores the provisions of § 27-12-104(a)(i), which require the injured employee to utilize up to one-half of the proceeds obtained through litigation to reimburse the state treasury for the total amount of all benefits received:

“(a) If an employee covered by this act receives an injury under circumstances creating a legal liability in some person other than the employer to pay damages, the employee if engaged in extrahazardous work for his employer at the time of the injury is not deprived of any compensation to which he is entitled under this act. He may also pursue his remedy at law against the third person. If the employee recovers from the third person in any manner including judgment, compromise, settlement or release, the total proceeds, without regard to the types of damages alleged in the third-party action, of the recovery shall be divided as follows:

“(i) After deducting the reasonable cost of recovery or collection not to exceed one-third (V3) of the recovery, one-half (V2) of the remainder shall be immediately paid to the injured employee, his personal representative or other person granted the recovery and up to one-half (¥2) shall be paid to the state treasurer in reimbursement for the total amount of all awards received or in absence of a disclaimer of any unpaid balances to be received by the injured employee under this act including all monies paid to him or in his behalf, less the state’s pro rata share of costs of recovery or collection. * * ”

Finally, the Court’s interpretation of the Governmental Claims Act, which acknowledges an injured public employee’s right to sue his culpably negligent co-employee, does not implicate the relationship between the injured employee and his public employer and, therefore, does not violate § 1-39-119, which provides:

“The provisions of this act shall not affect any provision of law, regulation or agreement governing employer-employee relationships.”

The injured plaintiff’s rights, according to this Court’s opinion, are co-extensive with those provided by the Worker’s Compensation Act, § 27-12-103(a), supra. That is, an injured plaintiff covered by worker’s compensation may undertake to establish the culpable negligence of his co-employee and, if successful, execute upon his or her judgment. The judgment debtor (the Be-fus estate in the case at bar) is then entitled to indemnification from the governmental entity for any loss suffered, § 1-39-104(b). The injured plaintiff’s rights to compensation, however, are not directly enhanced or affected by the largess of the public treasury. He or she is entitled only to such rights as the law contemplates may be asserted by a judgment creditor against a judgment debtor in pursuit of his or her satisfaction of the judgment.

Notwithstanding the understandable desires of those who would prefer to see the governmental entity directly compensate the injured person for the wrongs of his co-employee, § l-39-104(b) is an indemnifi cation provision designed to protect and hold harmless the governmental tortfeasor. The plain language of this section of the statute leads unerringly to the conclusion that it does not provide insurance that the injured plaintiffs judgment will be satisfied by the concerned governmental entity. By its terms, § l-39-104(b) indemnifies the judgment debtor, and any enlargement of the class protected by this statute must be provided by the legislature.

Under the law of indemnity, the government’s liability as indemnitor does not arise until the indemnitee-tortfeasor has suffered loss, 2 Williston on Contracts, 3d Ed. § 403, p. 1091. The injured plaintiff — judgment creditor — has no right of action against the governmental entity pursuant to § l-39-104(b) to satisfy his or her judgment against the tortfeasor public employee. The judgment creditor’s only right of action is against the judgment debtor. Were we to ignore the provisions of the statute in the instant case by directing that the State pay the amount of the judgment regardless of the loss sustained by the tortfeasor, we would, in effect, be enhancing the rights of the injured employee with respect to his employer, the State. Since the State employee covered by worker’s compensation is precluded from obtaining a judgment directly against the State, we cannot allow him to recover the amount of his judgment indirectly from the State thereby circumventing the exclusive-remedy provisions of the Constitution. The governmental employee-tortfeasor, however, can rely on the indemnification statute for protection from loss, whatever that loss might turn out to be as a consequence of the judgment creditor’s pursuit of his or her rights under the judgment.

Accordingly, the Court’s opinion remands this case to the district court to make factual and legal determinations as to the amount of loss sustained and sustainable by the defendant tortfeasor, from which loss or losses the indemnitor must save the indemnitee harmless under the law of indemnity. We cannot tell from the record what the Befus estate’s losses either are or might be, and this appeal is not postured in a way which asks or permits this Court to interpret the law of indemnity as regards judgment creditors versus judgment debtors who are indemnitees of third-party in-demnitors; hence remand is necessary. We might say parenthetically, however, that some, but by no means all, of the relevant factors affecting the extent of the State’s liability to the Befus estate include the assets in the estate subject to execution, whether the litigants have settled for a sum less than the judgment, and what losses the indemnitee might suffer in the future from which the law of indemnity provides that the indemnitee must be held harmless.

For all of the reasons set out in the Court’s opinion of April 1, 1985, as further emphasized by this order, we find that the Petition for Rehearing should be denied. It is, therefore,

ORDERED that the State of Wyoming’s Petition for Rehearing be, and it hereby is, denied.

ROONEY, J., filed a specially dissenting opinion. BROWN, J., filed a dissenting opinion in which ROONEY, J., joined.