Jim Sutton and Angela Sutton v. Council Bluffs Water Works ( 2023 )

IN THE SUPREME COURT OF IOWA
No. 22–0513
Submitted February 22, 2023—Filed May 19, 2023
JIM SUTTON and ANGELA SUTTON,
Appellees,
vs.
COUNCIL BLUFFS WATER WORKS,
Appellant.
Appeal from the Iowa District Court for Pottawattamie County, Greg W.
Steensland, Judge.
A municipality appeals the denial of its motion to dismiss a strict-liability
claim for structural and other damage to a house resulting from a water main
break. AFFIRMED.
McDermott, J., delivered the opinion of the court, in which all participating
justices joined. Christensen, C.J., took no part in the consideration or decision
of the case.
Raymond E. Walden (argued), Michael T. Gibbons, and Christopher D.
Jerram of Woodke & Gibbons, P.C., L.L.O., Omaha, Nebraska for appellant.
Nicholas F. Sullivan (argued) and Tiffany S. Boutcher of Dvorak Law
Group, LLC, Omaha, Nebraska, for appellees.
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McDERMOTT, Justice.
Jim and Angela Sutton’s house in Council Bluffs sits near an intersection
where an underground water main broke in November 2020, sending water
flowing to the surface. The Suttons alerted Council Bluffs Water Works to the
problem and, over the next eight weeks, crews inspected and repaired breaks to
the pipe on five different occasions. The escaping water soon became standing
water.
The Suttons allege that all the water caused their house to settle, resulting
in damage to its foundation, interior walls, garage floors, and doors. They sued
Water Works under two legal theories: count 1, strict liability; and count 2,
negligence. Water Works moved to dismiss the strict liability claim, arguing that
the Iowa Municipal Tort Claims Act, Iowa Code ch. 670 (2021), doesn’t permit a
strict liability claim against it. The district court denied the motion. We granted
Water Works’s application for interlocutory appeal. We must decide whether the
Iowa Municipal Tort Claims Act allows a claim for strict liability—liability that
doesn’t depend on negligence or intent to do harm—against a municipality for
damage caused by an underground water main break.
In Lubin v. City of Iowa City, we held that a municipality could be held
liable under a theory of strict liability for damage resulting from an underground
water main break. 131 N.W.2d 765, 770–72 (Iowa 1964). We imposed strict
liability primarily because of the nature of the activity, explaining our reasoning
this way:
It is neither just nor reasonable that the city engaged in a
proprietary activity can deliberately and intentionally plan to leave
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a watermain underground beyond inspection and maintenance until
a break occurs and escape liability. A city or corporation so
operating knows that eventually a break will occur, water will escape
and in all probability flow onto the premises of another with
resulting damage. We do not ordinarily think of watermains as being
extra-hazardous but when such a practice is followed, they become
“inherently dangerous and likely to damage the neighbor’s property”
. . . . When the expected and inevitable occurs, they should bear the
loss and not the unfortunate individual whose property is damaged
without fault of his own.
Id. at 770 (citation omitted) (quoting Pumphrey v. J.A. Jones Constr. Co., 94
N.W.2d 737, 738 (Iowa 1959)).
In 1967, three years after we decided Lubin, the legislature enacted the
Iowa Municipal Tort Claims Act. 1967 Iowa Acts ch. 405 (originally codified at
Iowa Code ch. 613A (1971), now codified as amended at Iowa Code ch. 670
(2021)). The Act “does not expand any existing cause of action or create any new
cause of action against a municipality.” Iowa Code § 670.4(3). But it allows
people to assert claims against municipalities that otherwise would have been
barred by governmental immunity. Venckus v. City of Iowa City, 930 N.W.2d 792,
809 (Iowa 2019). In establishing a municipality’s scope of liability for the tortious
conduct of its officers or employees, the Act states in part: “Except as otherwise
provided in this chapter, every municipality is subject to liability for its torts and
those of its officers and employees, acting within the scope of their employment
or duties, whether arising out of a governmental or proprietary function.” Iowa
Code § 670.2(1); see also Thomas v. Gavin, 838 N.W.2d 518, 521–22 (Iowa 2013).
Water Works’s argument builds on a series of premises. Water Works first
notes that the Act eliminated the right to pursue claims against municipalities
that the Act itself doesn’t authorize. See Rucker v. Humboldt Cmty. Sch. Dist.,
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737 N.W.2d 292, 293 (Iowa 2007) (stating that the Act “is the exclusive remedy
for torts against municipalities and their employees”). It then interprets the Act
to prohibit claims based on strict liability, thus abolishing the strict liability
cause of action that we recognized in Lubin. As a result, Water Works concludes
that the district court erred in failing to dismiss the Suttons’ strict liability claim.
We turn to the Act’s language to test Water Works’s premise that the Act
abolished claims for strict liability. As quoted above, the Act makes
municipalities liable for “torts.” Iowa Code § 670.2(1). The Act defines “tort” as
follows:
“Tort” means every civil wrong which results in wrongful death or
injury to person or injury to property or injury to personal or
property rights and includes but is not restricted to actions based
upon negligence; error or omission; nuisance; breach of duty,
whether statutory or other duty or denial or impairment of any right
under any constitutional provision, statute or rule of law.
Id. § 670.1(4).
Water Works argues that strict liability isn’t listed in the definition of “tort”
in the Act and thus isn’t a type of claim that the Act allows. It points to the
absence of strict liability in the definition’s list of causes of action (“negligence,”
“error or omission,” “nuisance,” and so on) and concludes that this means the
Act provides no cause of action for strict liability. Water Works seeks to bolster
its interpretation by reciting the negative-implication canon, which says that the
expression of one thing in a series excludes others that were not mentioned. See
Homan v. Branstad, 887 N.W.2d 153, 166 (Iowa 2016). If strict liability claims
are not permitted under the Act, Water Works argues, then we must dismiss
count I.
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But Water Works’s argument can’t overcome the plain meaning of the text.
The definition of “tort” doesn’t consist of a list of causes of action; the list is
offered only as an illustration. We know we’re being presented with a
nonexclusive list of examples based on the words that precede the list: “includes
but is not restricted to.” Iowa Code § 670.1(4). The negative-implication canon
doesn’t apply because it “properly applies only when . . . the thing specified . . .
can reasonably be thought to be an expression of all that shares in the grant or
prohibition involved.” Antonin Scalia & Bryan A. Garner, Reading Law: The
Interpretation of Legal Texts 107 (2012) [hereinafter Scalia & Garner, Reading
Law]. A list that by its terms is not exclusive cannot be an expression of all the
types of claims granted. The absence of strict liability from the list thus doesn’t
compel the interpretation that Water Works advances.
The defining language at the beginning of the sentence—that tort “means
every civil wrong which results in wrongful death or injury” to people, property,
or property rights—further clashes with Water Works’s interpretation. Iowa Code
§ 670.1(4). The term “civil wrong” isn’t separately defined, but its common usage
includes several concepts. It includes, for instance, an intentional act resulting
in harm (an intentional tort), an act involving wrongful conduct that
inadvertently results in harm (negligence), and an act resulting in harm for
which, because of the hazards involved, the law imposes strict liability. Tort,
Black’s Law Dictionary, 1792 (11th ed. 2019) (describing “[t]ortious conduct”).
The adjective every that precedes “every civil wrong” also suggests the broadest
conception of the term—all species of civil wrongs that aren’t exempted elsewhere
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in the statute are included. Applying the plain language of the statute, strict
liability claims are “torts” for which parties can pursue claims under the Act. See
generally Restatement (Third) of Torts: Liab. for Physical & Emotional Harm § 20,
at 229–73 (Am. L. Inst. 2010) (recognizing abnormally dangerous activities as
torts frequently subject to strict liability).
Water Works makes a related argument that the list of examples, if not
itself determinative, necessarily sheds light on the parameters of the Act’s
definition of “tort” and that the absence of strict liability from the list means that
“tort” is limited to fault-related causes of action. In making this argument, Water
Works recites the interpretive canon that associated words in a statute bear on
one another’s meaning. See State v. Ross, 941 N.W.2d 341, 348 (Iowa 2020);
Scalia & Garner, Reading Law at 195.
But this argument doesn’t work for two reasons. First, as already
discussed, the defining language (“every civil wrong which results in wrongful
death or injury”) embraces strict liability claims, and the nonexclusive list of
examples doesn’t rewrite that defining language. Second, even if the list of
examples could be read to alter the defining language, the Act’s insertion of
“nuisance” on the list suggests inclusion, rather than exclusion, of strict liability
because strict liability commonly applies to nuisance claims. In Martins v.
Interstate Power Co., we said that a “survey of our nuisance cases makes clear
that there can be a nuisance claim without an underlying actionable conduct,
such as negligence,” and “without a showing of intentional conduct”—in other
words, nuisance based on strict liability. 652 N.W.2d 657, 664 (Iowa 2002).
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Using the listed examples to shape the meaning of “tort” under the Act cuts
against the interpretation Water Works urges.
Water Works further argues that strict liability is inconsistent with an
exemption from liability in section 670.4(1)(h) of the Act, which bars
[a]ny claim based upon or arising out of a claim of negligent design
or specification, negligent adoption of design or specification, or
negligent construction or reconstruction of a public improvement
. . . or other public facility that was constructed or reconstructed in
accordance with a generally recognized engineering or safety
standard, criteria, or design theory in existence at the time of the
construction or reconstruction. A claim under this chapter shall not
be allowed for failure to upgrade, improve, or alter any aspect of an
existing public improvement or other public facility to new, changed,
or altered design standards.
Iowa Code § 670.4(1)(h). Water Works argues that paragraph (h), which was
enacted in 1983, includes a carve-out for certain types of negligence that would
not make sense if a municipality already faced broader liability based on strict
liability. See 1983 Iowa Acts ch. 198, § 25 (originally codified at Iowa Code
§ 613A.4(8) (1985), now codified as amended at Iowa Code § 670.4(1)(h) (2021)).
Water Works’s argument views too broadly the work that paragraph (h)
actually performs. The two sentences that make up paragraph (h) have distinct
features. The first sentence bars negligence claims—negligent design, negligent
specification, negligent construction, and so on—if the “the original designs or
specifications were proper at the time the public facility was constructed.”
Kellogg v. City of Albia, 908 N.W.2d 822, 826 (Iowa 2018) (quoting Hansen v. City
of Audubon, 378 N.W.2d 903, 906 (Iowa 1985)). The second sentence is not
limited to negligence and bars claims based on an alleged failure to upgrade
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existing public facilities when a new-and-improved design standard emerges.
Iowa Code § 670.4(1)(h).
Paragraph (h) thus grants municipalities a “state-of-the-art defense” to
several very specific claims. These two sentences apply to “public
improvement[s]” and “public facilit[ies]” id., with a broader reach than the strict
liability for underground water system malfunctions imposed in Lubin, 131
N.W.2d 765 at 770–72. Only the first sentence addresses negligence claims, and
only for a specific type of negligence: those related to design, specification, and
construction. The second sentence isn’t limited only to negligence claims but
provides a defense to a claim of failing to upgrade to an improved or changed
design. We presume that the legislature knows the state of the law, including
caselaw, when it enacts a statute. Iowa Farm Bureau Fed’n v. Env’t Prot. Comm’n,
850 N.W.2d 403, 434 (Iowa 2014). If the legislature wished to expand the state-
of-the-art defense to apply more particularly to strict liability claims such as the
one recognized in Lubin, it could have. It didn’t, and it isn’t for us to read such
an intention into the targeted state-of-the-art defense that paragraph (h)
provides.
Neither part of the state-of-the-art defense in paragraph (h) applies here.
The Suttons allege in count I that Water Works is strictly liable for the damage
to their house based on the inherent danger associated with the underground
water main. Count I alleges no negligence (in design, specification, construction,
or otherwise) that would trigger the state-of-the-art defense in paragraph (h)’s
first sentence. And the Suttons similarly make no allegation of any failure by
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Water Works to upgrade, improve, or alter any part of the water distribution
system to a new, changed, or altered design standard to trigger the defense in
paragraph (h)’s second sentence.
Finally, Water Works argues that our opinion in Kellogg v. City of Albia
should be read as having done away with strict liability claims under the Act and
thus implicitly overruling Lubin. Kellogg, 908 N.W.2d at 826. In Kellogg, a
homeowner sued the city not based on damage from a broken underground
water pipe but because a properly functioning storm sewer became
overburdened and caused flooding during heavy rains. Id. at 824–25. The city
argued that the homeowner’s nuisance claim was really just a claim for failing
to upgrade the overburdened storm sewer system and was pleaded as nuisance
to sidestep the state-of-the-art defense. Id. at 826. Persuaded by the city’s
argument, we held that the nuisance claim was barred by the state-of-the-art
defense and affirmed summary judgment for the city. Id. at 830.
But Kellogg does not, as Water Works argues, signal our refusal to
recognize strict liability under the Act against a municipality for damage caused
by an underground water main break. Kellogg didn’t involve a water main break.
The homeowner in Kellogg alleged no claim of strict liability. Indeed, the term
“strict liability” appears nowhere in the opinion. See generally id. It’s
unsurprising, then, that the opinion contains no discussion of Lubin. Stated
simply, Kellogg addressed different facts and different claims, and it neither
abrogates nor overrules our holding in Lubin. We note that the court of appeals,
in a published opinion twelve years after the Iowa Municipal Tort Claims Act was
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enacted, applied Lubin and affirmed strict liability against a municipality for
damages based on a water main break. See Iowa Power & Light Co. v. Bd. of
Water Works Trs., 281 N.W.2d 827, 831 (Iowa Ct. App. 1979). In short, we find
nothing in our caselaw, and nothing in chapter 670, that upends our holding in
Lubin.
Water Works has failed to show that the Iowa Municipal Tort Claims Act
bars the Suttons’ claim for damages based on strict liability. We thus affirm the
district court’s denial of the motion to dismiss this claim.
AFFIRMED.
All justices concur except Christensen, C.J., who takes no part.