Francis Livingood, Christoper Maury, and Daniel Robbins v. City of Des Moines, Iowa ( 2023 )

IN THE SUPREME COURT OF IOWA
No. 22–0536
Submitted February 22, 2023—Filed June 9, 2023
FRANCIS LIVINGOOD, CHRISTOPHER MAURY, and DANIEL ROBBINS,
Appellants,
vs.
CITY OF DES MOINES, IOWA,
Appellee.
Appeal from the Iowa District Court for Polk County, Scott D. Rosenberg,
Judge.
Plaintiffs appeal from the district court order granting summary judgment
in favor of a municipality on challenges to the municipality’s use of the state
income offset program to collect automated traffic citations not reduced to a legal
judgment. AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
McDonald, J., delivered the opinion of the court, in which all justices
joined. Mansfield, J., filed a concurring opinion.
Claire M. Diallo (argued), and James C. Larew of Larew Law Office, Iowa
City, for appellants.
Michelle Mackel-Wiederanders (argued) and Luke DeSmet, Assistant City
Attorneys, Des Moines, for appellee.
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McDONALD, Justice.
Several vehicle owners brought this suit to challenge the City of
Des Moines’ use of the state’s income offset program to collect automated traffic
citation penalties not reduced to a judgment in a municipal infraction
proceeding. In their petition, the vehicle owners contended the city’s use of the
income offset program: (1) was an unlawful property tax, (2) violated the statute
of limitations, (3) amounted to an unconstitutional taking, (4) was preempted by
state law, (5) violated their state constitutional right to due process of law, and
(6) constituted unjust enrichment. The parties filed cross-motions for summary
judgment. The district court denied the vehicle owners’ motion for summary
judgment and granted the city’s motion for summary judgment. The vehicle
owners timely filed this appeal. We affirm in part and reverse in part the
judgment of the district court.
I. The City’s Automated Traffic Enforcement Program.
We begin with an overview of the city’s automated traffic enforcement (ATE)
program as operated during the time relevant to this case. See Des Moines, Iowa,
Mun. Code § 114-243 (2017).1 Under the program, the city used fixed cameras
to enforce certain municipal traffic laws. When a traffic camera detected a
violation of the traffic laws, the camera took a photo or video and sent it to
GATSO, a third-party vendor hired to administer the ATE program. GATSO ran
the license plate information from the photo or video through Nlets, “a network
1Des Moines Municipal Code section 114-243 was amended in July 2017. For the purpose
of this appeal, the parties agree that Ordinance No. 14,885, passed in September 2009, is the
relevant ordinance.
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communication center that connects over 55,000 law enforcement and judicial
agencies in North America.” Once GATSO determined the owner of the vehicle
depicted, GATSO sent the information to the Des Moines Police Department for
review. A police officer reviewed each photo or video and determined whether a
violation should be pursued. If the officer determined a violation should be
pursued, GATSO issued a notice of violation to the owner of the vehicle. Id.
§ 114-243(d)(1).
The notice of violation sent to the vehicle owner included a photo of the
alleged violation, the name and badge number of the police officer who reviewed
the information, the amount of the civil penalty, and a website where the vehicle
owner could review a recording of the violation and pay the civil penalty. The
notice provided that a vehicle owner had “the right to contest this violation in
person at an administrative hearing or by mail if [the owner] reside[d] outside of
the State of Iowa.” The notice also provided, “Failure to pay the penalty or contest
liability by the due date is an admission of liability and will result in this penalty
being forwarded to collections or for filing in state district court.”
The options provided to the vehicle owner in the notice did not track the
city’s ATE ordinance. The city’s ordinance provided two options to a vehicle
owner issued a notice of violation. Id. § 114-243(d)(1)–(2). First, the vehicle owner
could voluntarily pay the penalty. Id. § 114-243(d)(1). Second, the vehicle owner
could “dispute the citation by requesting an issuance of a municipal infraction
citation by the police department.” Id. § 114-243(d)(2).
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Just as the notice of violation did not track the city’s ordinance, the city
did not follow its ordinance when enforcing the citation. At all times relevant to
this proceeding, the municipal code provided, “If a recipient of an automated
traffic citation does not pay the civil penalty by the stated due date or request a
trial before a judge or magistrate, a municipal infraction citation will be issued
to the recipient by certified mail from the police department.” Id. § 114-243(d)(3).
In other words, if an alleged violator did not pay the civil penalty and did not
request the city issue a municipal infraction citation, the city was supposed to
commence a municipal infraction proceeding.
Instead of adhering to its ordinance, the city commenced collection efforts
outside court. If a vehicle owner did not pay or respond to the notice of violation
within thirty days, GATSO sent a second notice. The second notice provided,
“Please be advised that you have exhausted all challenge options and this
is a debt due and owing to the City of Des Moines. Failure to pay the fine
immediately will subject you to formal collection procedures.” Once the
notice of violation was outstanding for more than sixty days, GATSO transferred
the matter back to the city.
After the notice of violation was transferred back, the city availed itself of
the state’s income offset program to collect the civil penalty. The income offset
program allows the department of administrative services to “establish a debt
collection setoff procedure for collection of debts owed to [a] public agency.” Iowa
Code § 8A.504(1)(a) (2017). Generally speaking, the income offset program allows
the department of administrative services to collect debts for public agencies by
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offsetting the debts against any income tax refund owed to a taxpayer. The city
entered into a memorandum of understanding with the department of
administrative services to use the income offset program. The memorandum
provided that only debts “in the form of a liquidated sum due, owing and payable”
were eligible for placement in the program. The memorandum further provided
that “[a]ll applicable remedies with regard to such a debt and claim must be
exhausted . . . as a condition precedent for eligibility to participate in the offset
program.” It was the city’s obligation to develop and maintain a system for
reporting eligible debts to the department. It was also the city’s obligation to
ensure that the debts referred to the income offset program were “legally
enforceable.” Under the terms of the memorandum, “To establish enforceability
the debt shall . . . have been reduced to a final judgment or final agency
determination that is no longer subject to appeal, certiorari, or judicial review,
or has been affirmed through appeal, certiorari, or judicial review.”
Before placing an alleged debt with the department of administrative
services for collection in the income offset program, the city sent a reminder
postcard to the vehicle owner regarding the alleged debt. The reminder postcard
stated that an owner could “request an informal hearing, pursuant to Municipal
Code Section 3-27, regarding placement of this debt in the State of Iowa Income
Offset Program” by writing the City of Des Moines finance director.
If the vehicle owner did not respond within thirty days of receiving the
postcard, the status of the debt changed to “offset eligible.” The city would then
send to the department of administrative services the vehicle owner’s name,
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social security number, and the amount allegedly owed. Iowa Code
§ 8A.504(2)(b). If the department turned up a match, the department notified the
city and held the entirety of the vehicle owner’s income tax refund. The city would
then send the vehicle owner a “notice of intent to offset.” Id. § 8A.504(2)(f)(1). The
notice provided, “If payment, or proof of payment, is not received in full within
15 days of the date of this Notice, your state income tax refund will be applied
toward the balance of the citation(s).” The notice provided vehicle owners could
contest the amount due by contacting the city finance department but “the only
issue which will be reviewed is whether the amount due is correct under the
Municipal Code.” After receiving the notice, the vehicle owner could consent to
the offset, pay the ATE penalty to the city directly and receive the full income tax
refund, or contest the offset as set forth in the notice. Id. § 8A.504(2)(h).
II. Background and Procedural Posture.
A. The Plaintiffs: Francis Livingood, Christopher Maury, and Daniel
Robbins. The plaintiffs in this case are Francis Livingood, Christopher Maury,
and Daniel Robbins. Livingood’s vehicle was recorded traveling seventy-one miles
per hour in a sixty-mile-per-hour area on March 14, 2014. A notice of violation
was sent to Livingood’s address on March 20. The amount of the civil penalty
was $65. A second notice of violation was sent on May 6. Livingood did not
respond to either notice. In March 2015, the city sent a notice of intent to offset
Livingood’s $185 tax refund to obtain the $65 civil penalty he allegedly owed.
Livingood’s counsel contacted the city to dispute the offset. The city responded,
“It is our understanding that the Iowa Department of Revenue has issued
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Mr. Livingood’s refund to him in its entirety. Since the funds have already been
released to Mr. Livingood, there is no need for a hearing on the matter at this
time.” In October 2016, however, the city sent Livingood a postcard stating that
if he did not pay the penalty by November, the ATE penalty would again be
referred to the income offset program. The record in this case reflects that
Livingood has not yet paid the penalty.
Maury’s vehicle was recorded traveling seventy-one miles per hour in a
sixty-mile-per-hour area on February 28, 2016. A notice of violation was sent on
March 4. The ATE penalty was $65. A second notice of violation was sent on
April 5. Maury did not respond to the notices. On September 23, the city sent
Maury a postcard reminder of the debt and notice that the alleged debt was being
sent to the income offset program. Maury did not respond. The following
February, the city sent Maury notice of intent to offset, informing him that his
$877 tax refund was being held due to nonpayment of the $65 penalty. Maury
called and consented to the city collecting the ATE penalty from his tax refund.
Robbins’s vehicle was recorded traveling seventy-one miles per hour in a
sixty-mile-per-hour area on June 17, 2012. A notice of violation was sent on
June 26, indicating Robbins owed a $65 ATE penalty. A second notice of violation
was sent on August 3. The same vehicle was recorded traveling thirty-seven
miles per hour in a twenty-five-mile-per-hour area on March 31, 2015. A notice
of violation was sent on April 7, and a second on May 15. The penalty for the
second violation was $65. On May 21, 2016, and December 14, the city sent
postcard reminders regarding the debts and notice that the debts would be
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referred to the income offset program. Robbins did not respond. On April 28,
2017, the city sent Robbins a notice of intent to offset his $205 tax refund to
obtain the $130 allegedly owed. Shortly thereafter, $130 was offset from
Robbins’s state income tax refund and the remainder was remitted to him.
B. District Court Proceedings. The petition in this case was filed on
February 9, 2017. The original plaintiffs were Jason Fett, Andrea Schramm,
and Livingood. Significant motion practice took place after the filing of the
initial petition, including the dismissal of plaintiffs Fett and Schramm and the
addition of new plaintiffs.
The operative petition in this appeal is the third amended petition. In that
petition, Livingood, Maury, and Robbins alleged: (1) the city’s ATE ordinance was
an unlawful property tax not authorized by the general assembly and in violation
of Iowa Code section 364.3; (2) the city’s collection efforts, including use of the
income offset program, violated the statute of limitations set forth in Iowa Code
section 614.1(1); (3) the city’s use of the income offset program amounted to an
unconstitutional taking in violation of article I, section 18 of the Iowa
Constitution; (4) the city’s use of the income offset program to collect a civil
penalty not reduced to a judgment was preempted by Iowa Code section 364.22;
(5) the city’s use of the income offset program violated their rights to due process
of law under article I, section 9 of the Iowa Constitution; and (6) the city’s use of
the income offset program to enforce automatic traffic citations not reduced to a
judgment constituted unjust enrichment. They sought injunctive relief,
declaratory relief, and damages, including attorney fees and costs for each claim.
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The parties filed cross-motions for summary judgment on all claims. The
district court denied the plaintiffs’ motion, granted the city’s motion, and
dismissed all of the plaintiffs’ claims. On appeal, the plaintiffs challenge the
district court’s rulings on each of their claims except the unlawful tax claim. We
review the district court’s summary judgment rulings for the correction of errors
at law. Kostoglanis v. Yates, 956 N.W.2d 157, 158 (Iowa 2021).
III. Statute of Limitations Claim.
The plaintiffs claim the city violated the statute of limitations by collecting
or attempting to collect ATE penalties through the income offset program more
than one year after the alleged traffic violation. See Iowa Code § 614.1(1)
(providing actions to enforce municipal infractions must be brought within one
year). The district court dismissed the claim on the ground the city was “not
violating the statute of limitations because [it was] not bringing a court action.”
We conclude the district court did not err in dismissing this claim.
For the reasons explained in Stogdill v. City of Windsor Heights, ___ N.W.2d
___, ___ (Iowa 2023), filed today, the statute of limitations is inapplicable to the
city’s use of the income offset program because the statute of limitations does
not apply to collection efforts made outside of court proceedings. See id. at ___
(“The statute of limitations is wholly inapplicable to the city’s out-of-court
collection efforts.”). In addition, “The statute of limitations is not a cause of
action; the statute of limitations is an affirmative defense to a cause of action.”
Id. at ___. A party cannot “violate” the statute of limitations. See id. The plaintiffs’
statute of limitations claim fails as a matter of law.
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IV. Unconstitutional Taking Claim.
Livingood, Maury, and Robbins claim the city’s use of the income offset
program amounts to an unconstitutional taking under the Iowa Constitution.
Article I, section 18 of the Iowa Constitution provides, “Private property shall not
be taken for public use without just compensation first being made.”
[This court has] set forth the following analysis concerning takings
claims: (1) Is there a constitutionally protected private property
interest at stake? (2) Has this private property interest been “taken”
by the government for public use? and (3) If the protected property
interest has been taken, has just compensation been paid to the
owner?
Kelley v. Story Cnty. Sheriff, 611 N.W.2d 475, 479 (Iowa 2000) (en banc).
Plaintiffs contend that the city is taking their money for public use and that the
city must pay just compensation by returning the same money. The district court
dismissed this claim on the ground that no taking occurs when the city exercises
its police power to enforce penalties for violation of its law. We affirm the district
court’s dismissal of this claim.
The threshold question presented is whether state income tax refunds are
constitutionally protected private property. See id. Takings claims typically relate
to real property or chattels and not money. See, e.g., Kelley, 611 N.W.2d at479–83 (arguing destruction of property by police during arrest amounts to
unconstitutional taking); Bormann v. Bd. of Supervisors, 584 N.W.2d 309,
313–14 (Iowa 1998) (en banc) (arguing designation of land as “agricultural area”
amounts to unconstitutional taking). Thus, “[t]akings are generally effected
through the power of eminent domain” or less formal regulatory takings related
to real or personal property. Lafaye v. City of New Orleans, 35 F.4th 940, 943
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(5th Cir. 2022). Nonetheless, there is some authority standing for the proposition
that money can be property within the meaning of the takings clause in certain
contexts. See, e.g., Brown v. Legal Found. of Wash., 538 U.S. 216, 239–40 (2003)
(holding that state IOLTA programs requiring earned interest be donated for legal
services effected “taking” of property); Webb’s Fabulous Pharmacies, Inc. v.
Beckwith, 449 U.S. 155, 163–65 (1980) (holding statute allowing clerk of court
to keep all interest earned on interpleaded funds effected “taking” without just
compensation); McCarthy v. City of Cleveland, 626 F.3d 280, 284–87 (6th Cir.
2010) (discussing issue).
With that background, we conclude the income tax refunds at issue in this
case were constitutionally protected private property. The tax refunds were due
and owing to the plaintiffs, and the treasurer was required to pay them. Iowa
Code § 422.74. The conclusion that state income tax refunds are constitutionally
protected private property is consistent with our controlling authorities and
other persuasive authorities. See Hagge v. Iowa Dep’t of Revenue & Fin.,
539 N.W.2d 148, 154 (Iowa 1995) (holding state tax refund “was the individual
property or money of each taxpayer” and that district court lacked authority to
instruct withholding percentage of refund to pay attorney fees); In re Marriage of
Huffman, 453 N.W.2d 246, 247 (Iowa Ct. App. 1990) (discussing state income
tax refund as marital property subject to division); see also Kokoszka v. Belford,
417 U.S. 642, 648 (1974) (holding income tax refund was property within
meaning of bankruptcy code); U.S. Tr. v. Klages (In re Klages), 373 B.R. 902,
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906–08 (Bankr. N.D. Iowa 2007) (holding tax refund was property of debtor’s
estate).
Although we conclude the plaintiffs’ income tax refunds were
constitutionally protected property, we cannot conclude that the city’s actions
here constituted a “taking” for “public use” within the meaning of article I,
section 18. “[T]he taking of money is different . . . from the taking of real or
personal property.” San Remo Hotel L.P. v. City & County of San Francisco,
41 P.3d 87, 106 (Cal. 2002) (quoting Ehrlich v. City of Culver City, 911 P.2d 429,
454–55 (Cal. 1996)). “[T]he principles of takings law that apply to real property
do not apply in the same manner to statutes imposing monetary liability.”
Branch v. United States, 69 F.3d 1571, 1576 (Fed. Cir. 1995). The purpose of the
takings clause is “to bar the Government ‘from forcing some people alone to bear
public burdens which, in all fairness and justice, should be borne by the public
as a whole.’ ” Tyler v. Hennepin Cnty., ___ U.S. ___ (2023) (quoting Armstrong v.
United States, 364 U.S. 40, 49 (1960)).
Here, the city is not taking property for a public use. It is not asking the
plaintiffs to bear a burden that should be borne by the public as a whole. Instead,
the city is collecting penalties allegedly owed for violation of its laws. The
government’s collection of money for the payment of fines in the exercise of its
police power is not a “taking” for “public use” and does not implicate the takings
clause. United States v. Droganes, 728 F.3d 580, 591 (6th Cir. 2013) (“[T]he
[g]overnment’s seizure and retention of property under its police power does not
constitute a ‘public use.’ ” (quoting Innovair Aviation Ltd. v. United States,
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632 F.3d 1336, 1341 (Fed. Cir. 2011))); Swisher Intern., Inc. v. Schafer, 550 F.3d
1046, 1054 (11th Cir. 2008) (“[T]he takings analysis is not an appropriate
analysis for the constitutional evaluation of an obligation . . . merely to pay
money.”); Walker v. City of Chicago, No. 20–cv–01379, 2022 WL 17487813, at *5
(N.D. Ill. Dec. 6, 2022) (stating there was no constitutional taking where funds
were not taken “for a public purpose but instead to satisfy the owners’ debts”);
State v. Chesnel, 25 A.3d 946, 950 n.2 (Me. 2011) (“Nor did the collection of funds
from the prison account amount to an unconstitutional taking because the funds
were not ‘taken for public uses,’ but rather were collected to satisfy Chesnel’s
personal obligation to pay court fines.” (quoting Me. Const. art. I, § 21)); Smith v.
Or. Gov’t Ethics Comm’n, 564 P.2d 1368 (Or. Ct. App. 1977) (“[S]uffice it to state
the obvious: A fine or penalty . . . does not constitute a ‘taking’ for which
compensation need be provided.”).
Whether the city acted lawfully or unlawfully in exercising this power is
not material to the takings analysis. “[A]n exaction of money that is completely
unlawful, whether compensated or not, is not a taking.” Lafaye, 35 F.4th at 943.
A victim of lawless government action can seek compensation or other relief, as
the plaintiffs do here, but the city’s use of the income offset program to collect
an alleged debt is not a constitutional taking. The district court correctly
dismissed the plaintiffs’ taking claim.
V. Preemption Claim.
Plaintiffs next claim the city’s use of the income offset program is
preempted by state law. Specifically, plaintiffs contend Iowa Code section 364.22
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requires that the city pursue a municipal infraction and obtain a judgment before
an ATE penalty can be involuntarily collected. The district court held the city’s
use of the income offset program to collect debts not yet reduced to a judgment
was authorized by Iowa Code section 8A.504 and was thus not preempted by
state law. For the reasons expressed below, we affirm in part and reverse in part
the district’s ruling on this claim.
A. The Law of Preemption, Generally. We begin our analysis with an
overview of the law of preemption with respect to state and local laws. “In 1968,
the Iowa Constitution was amended to provide municipal governments with
limited powers of home rule.” City of Davenport v. Seymour, 755 N.W.2d 533,
537–38 (Iowa 2008) (citing Iowa Const. art. III, § 38A). Under home rule
authority, the legislature “retains the unfettered power to prohibit a municipality
from exercising police powers, even over matters traditionally thought to involve
local affairs.” Id. at 538. On the other hand, a municipality may act without
express legislative approval so long as its laws are not inconsistent with the laws
of the general assembly. Id. “An ordinance is inconsistent with a law of the
general assembly and, therefore, preempted by it, when the ordinance prohibits
an act permitted by a statute or permits an act prohibited by a statute.” City of
Clinton v. Sheridan, 530 N.W.2d 690, 691 (Iowa 1995) (en banc).
Our cases “have recognized three types of preemption. The first type,
generally known as express preemption, applies where the legislature has
specifically prohibited local action in a given area.” Seymour, 755 N.W.2d at 538.
The second type of preemption is known as conflict preemption. See id. at 539.
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Conflict preemption occurs when an “ordinance cannot exist harmoniously with
a state statute because the ordinance is diametrically in opposition to it.” Id. at
538. The third type of preemption is known as field preemption. Id. at 539. This
is a “narrow doctrine.” Id. Field preemption occurs “when the legislature has so
covered a subject by statute as to demonstrate a legislative intent that regulation
in the field is preempted by state law.” Id. “In order to invoke the doctrine of field
preemption, there must be some clear expression of legislative intent to preempt
a field from regulation by local authorities, or a statement of the legislature’s
desire to have uniform regulations statewide.” Id.At issue in this case is conflict preemption. “The conflict preemption
doctrine is applicable only where the question presented is whether the
enactments of two governments can be reconciled and given legal effect.” Cedar
Rapids v. Leaf, No. 16–0435, 2017 WL 706305, at *8 (Iowa Ct. App. Feb. 22,
2017), aff’d, City of Cedar Rapids v. Leaf, 923 N.W.2d 184 (Iowa 2018). Properly
understood, conflict preemption addresses the question of whether a state law
conflicts with a municipality’s law and thus preempts it. The doctrine of conflict
preemption does not address and is not applicable where the question presented
is whether a municipality’s actions violate state law or its own law. Id. (“The
doctrine of conflict preemption is not implicated when the question presented is
whether the inferior government, in exercising its executive power to enforce a
particular enactment . . . , is in violation of an enactment of a superior
government.”).
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In conducting a conflict preemption analysis, “we presume that the
municipal ordinance is valid.” Seymour, 755 N.W.2d at 539. We strive to interpret
state law and municipal law in a manner that renders them harmonious. Id. We
will not find an ordinance in conflict with state law unless the ordinance is
“irreconcilable” with state law. Id. “The cumulative result of these principles is
that for implied preemption to occur based on conflict with state law, the conflict
must be obvious, unavoidable, and not a matter of reasonable debate.” Id.B. Preemption as Applied to the City’s Ordinances. In analyzing this
conflict preemption claim, we start with the relevant state law. Iowa Code
section 364.22 relates to municipal infractions. As relevant here, it sets forth the
procedures for municipal infraction proceedings:
6. In municipal infraction proceedings:
a. The matter shall be tried before a magistrate, a district
associate judge, or a district judge in the same manner as a small
claim. The matter shall only be tried before a judge in district court
if the total amount of civil penalties assessed exceeds the
jurisdictional amount for small claims set forth in section 631.1.
b. The city has the burden of proof that the municipal
infraction occurred and that the defendant committed the infraction.
The proof shall be by clear, satisfactory, and convincing evidence.
c. The court shall ensure that the defendant has received a
copy of the charges and that the defendant understands the
charges. The defendant may question all witnesses who appear for
the city and produce evidence or witnesses on the defendant’s
behalf.
d. The defendant may be represented by counsel of the
defendant’s own selection and at the defendant’s own expense.
e. The defendant may answer by admitting or denying the
infraction.
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f. If a municipal infraction is proven the court shall enter a
judgment against the defendant. If the infraction is not proven, the
court shall dismiss it.
Iowa Code § 364.22(6).
This court has had several occasions to discuss the interplay between
section 364.22 and ATE programs. We have held that section 364.22 does not
preclude a city from collecting a voluntary payment of ATE penalties without first
filing a municipal infraction. Rhoden v. City of Davenport, 757 N.W.2d 239, 241
(Iowa 2008). We have held that Iowa Code section 364.22 does not preclude a
municipality from offering an informal administrative hearing in addition to what
is required under section 364.22. Leaf, 923 N.W.2d at 198. In Weizberg v. City
of Des Moines, however, we interpreted section 364.22 to be the exclusive means
by which a municipality could enforce an automated traffic citation involuntarily.
923 N.W.2d 200, 220 (Iowa 2018) (“[T]o the extent a municipality seeks to assert
the coercive power of government to enforce payment of a penalty for a municipal
infraction, a municipality must pursue a municipal infraction under Iowa Code
section 364.22.”).
The city disagrees and contends that the collection of ATE penalties
through use of the income offset program is an alternative means of involuntary
enforcement that is explicitly authorized by statute, namely Iowa Code
section 8A.504. Section 8A.504 provides that the department of administrative
services “shall establish and maintain a procedure to set off against any claim
owed to a person by a public agency any liability of that person . . . or such other
qualifying debt” owed to a public agency. Iowa Code § 8A.504(2) (emphasis
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added). The city contends the ATE penalties fall within the meaning of “any
liability” and “other qualifying debt.” The city also relies on the department’s
administrative rule defining a “liability,” “debt,” or “qualifying debt” as “any
liquidated sum due, owing, and payable by a debtor to a public agency . . . [that]
may be accrued through . . . any legal theory regardless of whether there is an
outstanding judgment for that sum.” Iowa Admin. Code r. 11—40.1. In the city’s
view, these two provisions create an alternative means to enforce the penalties.
We are unpersuaded by the city’s argument. Citing Iowa Code
section 8A.504 as authority to collect ATE penalties merely begs the question.
Iowa Code section 8A.504 authorizes a municipality to refer to the income offset
program a liability “due, owing, and payable,” but neither the statute nor the
administrative rule defines when a liability becomes “due, owing, and payable.”
But the relevant question here is exactly that: When does an ATE penalty become
a liability or debt due, owing, and payable? On this question, we could not have
been clearer in our recent opinions regarding ATE programs. In Behm v. City of
Cedar Rapids, we recognized that “[u]nder Iowa Code section 364.22, no liability
arises until the city takes the affirmative step of filing an enforcement action in
district court and obtains a judgment against the defendant.” 922 N.W.2d 524,
562 (Iowa 2019). There is no liability or debt due, owing, and payable in the
absence of a judgment from the district court. Id. at 564–65 (holding that “no
liability of any kind attaches to a vehicle owner without the filing of a municipal
infraction” and stating relevant statutes do “not provide for any liability to arise
until the [municipality] takes the affirmative step of filing an enforcement action
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in district court and obtains a judgment against the defendant”). We reiterated
this point in Weizberg, stating “that no enforceable obligation will arise unless
the [municipality] files a municipal infraction in small claims court and obtains
a judgment.” 923 N.W.2d at 215 n.4. The city also ignores another provision of
the administrative code that provides, “Public agencies may only place debts in
the offset program if the debts are legally enforceable.” Iowa Admin. Code
r. 11—40.3(3). Under section 364.22, as interpreted in Behm and Weizberg,
these alleged debts were not legally enforceable.
None of this should come as a surprise. It has long been the law of this
state that municipal infraction penalties cannot be enforced absent judicial
process. We first addressed this issue in 1856 in Gosselink v. Campbell, 4 Iowa
(Clarke) 296 (1856). In that case, the city passed an ordinance that allowed it to
seize and sell hogs to pay a civil penalty for public nuisance infractions without
first initiating a court proceeding. Id. at 301. A farmer challenged the collection
of the fine without judicial process. We held the city ordinance was “defective”
and not enforceable “upon the common ground that [a] fine cannot be . . .
enforced without trial and adjudication.” Id. We reaffirmed this principle a
century later in Marquart v. Maucker, 215 N.W.2d 278 (Iowa 1974). There we
explained that fines and penalties “may be legally imposed or assessed only by a
lawful tribunal.” Id. at 282.
The fact that section 8A.504 does not provide an alternative method to
enforce an ATE penalty does not completely resolve the conflict preemption issue.
We still must determine whether Iowa Code section 364.22, as interpreted in
20
Behm and Weizberg, conflicts with and preempts the city’s ATE ordinance. Until
2017, the ordinance provided, in relevant part:
(1) [A red light or speeding violation] shall be considered for a
notice of violation for which a civil penalty in the amount specified
in the schedule of administrative penalties adopted by city council
by resolution shall be imposed, payable to the city of Des Moines at
the city’s finance department or a designee.
(2) A recipient of an automated traffic citation may dispute the
citation by requesting an issuance of a municipal infraction citation
by the police department. Such request will result in a required
court appearance by the recipient and in the scheduling of a trial
before a judge or magistrate at the Polk County Courthouse. The
issuance of a municipal infraction citation will cause the imposition
of state mandated court costs to be added to the amount of the
violation in the event of a guilty finding by the court.
(3) If a recipient of an automated traffic citation does not pay
the civil penalty by the stated due date or request a trial before a
judge or magistrate, a municipal infraction citation will be issued to
the recipient by certified mail from the police department. Said
municipal infraction citation will result in a mandatory court
appearance by the recipient as well as imposition of state mandated
court costs if a finding of guilty is made by the court.
Des Moines, Iowa, Mun. Code § 114-243(d).
We cannot conclude that Iowa Code section 364.22 was irreconcilable with
this ordinance and preempted it. The ordinance provided that the recipient of a
notice of violation could voluntarily pay the penalty, which we said does not
conflict with Iowa Code section 364.22. Rhoden, 757 N.W.2d at 241. The
ordinance also provided that the recipient of the notice could request the city
proceed with a municipal infraction proceeding, which we said section 364.22
allowed. Behm, 922 N.W.2d at 569. Further, the ordinance stated that if the
recipient of the notice did not pay the citation and did not request the city file a
municipal infraction, then the city would file a municipal infraction. This, too,
21
complied with Iowa Code section 364.22, as interpreted in Behm and Weizberg.
The problem with the city’s ATE ordinance was not that it was irreconcilable with
section 364.22, it was that the city did not comply with its own ordinance and
file a municipal infraction proceeding when the vehicle owner failed to pay the
penalty or request the city proceed with a municipal infraction. There is no
conflict preemption with respect to Des Moines Municipal Code
section 114-243—the city just acted unlawfully in violation of its own ordinance.
There are other relevant ordinances here as well. The city has adopted an
ordinance authorizing its participation in the state income offset program. See
Des Moines, Iowa, Mun. Code § 3-26 to -29. Pursuant to section 3-27, the city
shall provide notice to a debtor “that the debt will be placed in the offset program
and that the debtor shall have an informal opportunity to challenge such
placement by filing the challenge with the finance director within ten days of the
date of notice.” Id. 3-27(a). Although we have concluded that an ATE penalty is
not a liability or debt due, owing, and payable until reduced to a judgment
following a municipal infraction proceeding, this ordinance is not irreconcilable
with Iowa Code section 364.22. The ordinance, on its face, provides an alleged
debtor the opportunity to contest placement of an alleged debt in the program.
With respect to alleged ATE penalties, an alleged violator must be allowed to
contest placement on the ground that no debt is in fact due, owing, and payable
for failure to obtain a judgment, otherwise the ordinance would be preempted.
While the city’s referral of the civil penalty to the income offset program is
improper because no liability or debt is in fact due, owing, or payable in the
22
absence of a municipal infraction judgment, the opportunity provided to contest
placement in the income offset program makes the ordinance compatible with
Iowa Code section 364.22.
We reach a different conclusion with respect to Des Moines Municipal Code
section 3-29. When the department notifies the city of a potential offset, the city
must mail notice to the alleged debtor and provide the debtor with an opportunity
for a hearing. Id. § 3-28. At the hearing, the vehicle owner is not allowed to
challenge whether the penalty is due, owing, and payable. Instead, the ordinance
provides that if the vehicle owner did not request an administrative hearing or a
municipal infraction proceeding, then the “notice of violation is deemed a debt
subject to placement in the Des Moines Debt Offset Program.” Id. § 3-29. This
ordinance is in direct conflict with Iowa Code section 364.22, as interpreted in
Behm and Weizberg. As noted above, those cases provide that no enforceable
liability or debt arises “until the city takes the affirmative step of filing an
enforcement action in district court and obtains a judgment against the
defendant.” Behm, 922 N.W.2d at 562; see also Weizberg, 923 N.W.2d at 215 n.4
(“[N]o enforceable obligation will arise unless the [municipality] files a municipal
infraction in small claims court and obtains a judgment.”). Des Moines Municipal
Code section 3-29’s declaration that the civil penalty is a debt due, owing, and
payable without a municipal infraction judgment is directly contrary to and
irreconcilable with Iowa Code section 364.22. Compare Iowa Code § 364.22(6)
(providing procedure for establishing liability pursuant to municipal infraction),
23
with Des Moines, Iowa, Mun. Code § 3-29 (authorizing establishment of liability
contrary to Iowa Code § 364.22).
C. Disposition of Each Plaintiff’s Respective Preemption Claim.
Having concluded the city’s ordinances are preempted, in part, by Iowa Code
section 364.22, we must address the disposition of each of the plaintiffs’ claims.
Livingood, Maury, and Robbins have styled their preemption claim as a
cause of action. They seek damages, declaratory relief, and injunctive relief.
Damages are an inherently retrospective form of relief meant to compensate for
past wrongs already committed. Whereas declaratory and injunctive relief are
inherently prospective forms of relief meant to prevent future wrongs. As we
previously explained:
Declaratory actions differ from nearly all others, such as tort,
contract, and most special actions. Typically, parties seek court
judgments to resolve consequences of past acts or conduct. The view
of most court proceedings is retrospective. The view for declaratory
relief is prospective.
UAW v. Iowa Dep’t of Workforce Dev., No. 00–2112, 2002 WL 1285965, at *2 (Iowa
June 12, 2002) (per curiam); Melsha v. Trib. Pub. Co. of Cedar Rapids, 51 N.W.2d
425, 427 (Iowa 1952) (“The general purpose of a declaratory judgment is to
provide a speedy remedy for adjudication of legal rights before there has been an
invasion thereof, but generally this action is only maintainable where it will
accomplish some useful purpose.”).
Damages are not available for the plaintiffs’ “claim” of preemption.
Preemption is not a cause of action; preemption is an affirmative defense. See
Carroll Airport Comm’n v. Danner, 927 N.W.2d 635, 639, 641 (Iowa 2019) (stating
24
preemption is an affirmative defense); Martin v. Crook, No. 08–1711, 2009 WL
2392077, at *2 (Iowa Ct. App. Aug. 6, 2009) (preemption used as affirmative
defense); Leahy v. Deere & Co., No. 99–191, 2000 WL 700889, at *3 (Iowa Ct App.
May 31, 2000) (explaining conflict preemption is an affirmative defense); see also
Thermotek, Inc. v. Orthoflex, Inc, No. 3:11–CV–0870–D, 3:10–CV–2618–D, 2016
WL 4678888, at *4 (N.D. Tex. Sept. 7, 2016) (stating preemption is an affirmative
defense that can be waived); Lovegrove v. Ocwen Loan Serv., LLC,
No. 7:14cv00329, 2015 WL 5042913, at *3 (W.D. Va. Aug. 26, 2015) (stating
conflict preemption is an affirmative defense); Fostill Lake Builders, LLC v. Tudor
Ins., 338 S.W.3d 336, 344 (Mo. Ct. App. 2011) (same). Because preemption is
not a cause of action but an affirmative defense that must be raised in the
appropriate proceeding and at the appropriate time, it cannot support a claim
for damages and other monetary relief for past wrongs. The district court thus
did not err in dismissing this claim to the extent the plaintiffs seek monetary
relief for their claim of preemption.
With respect to declaratory and injunctive relief, these are not available to
plaintiffs Maury and Robbins. Maury and Robbins have already paid the civil
penalties. As will be discussed in more detail below, each had notice and an
opportunity to contest the referral of their penalties to the income offset program
and to present their preemption defense prior to offset, but neither requested a
hearing. Generally, “[a] declaratory judgment is meant to define the legal rights
and obligations of the parties in anticipation of some future conduct, not simply
to proclaim liability for a past act.” Just. Network Inc. v. Craighead County,
25
931 F.3d 753, 764 (8th Cir. 2019) (quoting Lawrence v. Kuenhold, 271 F. App’x
763, 766 (10th Cir. 2008)). And, “[g]enerally, rights already lost and wrongs
already committed are not subject to injunctive relief.” Engel v. Vernon,
215 N.W.2d 506, 516 (Iowa 1974). The district court thus did not err in
dismissing Robbins and Maury’s respective claims of preemption in their entirety
because neither is entitled to monetary, declaratory, or injunctive relief.
That leaves only Livingood’s claim for declaratory and injunctive relief. In
Iowa Ass’n of Business & Industry v. City of Waterloo, we held that a local
ordinance regulating employment practices was preempted, in part, by state law.
961 N.W.2d 465, 477–78 (Iowa 2021). Rather than holding the entire ordinance
preempted and without effect, we held that only the conflicting provisions should
be severed from the ordinance and given no legal effect. Id. at 478. We concluded
that remedy was appropriate, in part, because the ordinance had a severability
clause. Id. at 477–78.
As in Iowa Ass’n of Business & Industry, the city has a general severability
provision. It provides that if any decision finds part of the code is invalid, “such
decision shall not affect the validity of the remaining portions of this Code.” Des
Moines, Iowa, Mun. Code § 1-16. Accordingly, we hold that those parts of Des
Moines Municipal Code section 3-29 that (1) prohibit the recipient of a notice of
intent to offset from contesting the offset and (2) deem an ATE penalty not
reduced to judgment a debt “due, owing, and payable” are in conflict with,
preempted by, and rendered invalid by Iowa Code section 364.22. See Xenia
Rural Water Dist. v. City of Johnston, 959 N.W.2d 113, 124 (Iowa 2021)
26
(“Conflicting language in a county ordinance or resolution must yield to the
controlling state statute.”).
Livingood shall be entitled to assert this defense as to any claim of offset.
The district court erred in denying his motion for summary judgment and in
granting the city’s motion for summary judgment on this claim. We reverse the
judgment of the district court on this issue. On remand, the district court shall
enter the appropriate declaratory and injunctive relief in favor of Livingood.
VI. Procedural Due Process Claim.
The plaintiffs next contend the district court erred in dismissing their
claim that the city’s attempts to enforce the civil penalties violated their right to
procedural due process under article I, section 9 of the Iowa Constitution. The
district court dismissed the plaintiffs’ claim on the ground the civil penalties were
nominal and the plaintiffs were provided with multiple notices and opportunities
to protect those nominal interests. We affirm the district court’s ruling on this
issue.
“A party claiming a violation of procedural due process must first show an
impairment of an interest in life, liberty, or property by government action.”
Behm, 922 N.W.2d at 566. “Once a protected interest has been established, the
next question is what procedural minima must be provided before the
government may deprive the complaining party of the protected interest.” Id.“Ordinarily, the procedural minima include two components—notice and an
opportunity to be heard on the issue.” Id.27
Here, the plaintiffs were provided with multiple notices and opportunities
to be heard. They were provided with the original notice of violation and afforded
the opportunity to request a hearing. They were provided with a second notice
regarding the civil penalty. None of the plaintiffs took any action on either of
these notices. Each of the plaintiffs was provided notice of the city’s intent to
transfer the matter to the income offset program and an opportunity to challenge
the transfer. None of the plaintiffs took advantage of that opportunity. Finally,
each of the plaintiffs was provided with notice of an intent to offset. The plaintiffs’
failure to seek a hearing precludes their procedural due process claim.
As in Stogdill, the plaintiffs contend that even though they did not avail
themselves of these opportunities, the city nonetheless violated their rights to
due process by referring the ATE penalties to the income offset program without
first reducing the penalties to a judgment in a municipal infraction proceeding
pursuant to Iowa Code section 364.22. We rejected this argument in Stogdill,
___ N.W.2d at ___, and we reject it here as well. The government’s failure to
comply with a statute or ordinance does not necessarily establish a due process
violation. See Stogdill, ___ N.W.2d at ___; Weizberg, 923 N.W.2d at 214 (“The
failure to follow such a procedure or ordinance cannot give rise, in and of itself,
to a due process violation.”); Behm, 922 N.W.2d at 568 (“A mere violation of a
statute does not give rise to a due process violation . . . .”); Stuart v. City of
Dubuque Zoning Bd. of Adjustment, No. 19–1688, 2020 WL 6484041, at *4 (Iowa
Ct. App. Nov. 4, 2020) (affirming dismissal of due process claim premised on
Board’s failure to follow procedures in ordinance where plaintiffs nonetheless
28
received notice and an opportunity to be heard). “[I]n all cases, the focus of the
analysis must be on the critical question of whether the process that was
provided comported with the basic requirements of notice and an opportunity to
be heard.” Weizberg, 923 N.W.2d at 214. Here, the parties were given multiple
notices and multiple opportunities to be heard, and they did not take advantage
of those opportunities. We affirm the judgment of the district court.
VII. Unjust Enrichment Claim.
This brings us to the plaintiffs’ final claim—unjust enrichment. The district
court dismissed this claim on the ground the city’s conduct was not in any way
unlawful. We affirm in part and reverse in part the judgment of the district court.
The concept of unjust enrichment is not a judicial remedy to correct
perceived injustices, unfairness, or inequities in a broad sense. Rather, the
doctrine involves a “narrower set of circumstances giving rise to what might more
appropriately be called unjustified enrichment.” Restatement (Third) of
Restitution & Unjust Enrichment § 1 cmt. b, at 4 (Am. L. Inst. 2011); see also
Rilea v. State, 959 N.W.2d 392, 394 (Iowa 2021) (“The circumstances giving rise
to an unjust enrichment cause of action might more appropriately be labeled
‘unjustified enrichment’ seeing as our focus centers on whether there has been a
‘transfer of a benefit without adequate legal ground.’ ” (quoting Restatement
(Third) of Restitution & Unjust Enrichment § 1 cmt. b, at 6)). In the technical
sense, “[u]njustified enrichment is enrichment that lacks an adequate legal
basis.” Restatement (Third) of Restitution & Unjust Enrichment § 1 cmt. b, at 4.
“The elements of unjust enrichment are (1) enrichment of the defendant, (2) at
29
the expense of the plaintiff, (3) under circumstances that make it unjust for the
defendant to retain the benefit.” Behm, 922 N.W.2d at 577.
The city concedes the first two elements of unjust enrichment are met, but
it disputes the third. The city argued in the district court and argues on appeal
that its administration of the ATE program was entirely lawful. As set forth
above, we disagree with the city’s assertion that its conduct was entirely lawful.
First, the city did not follow its own ordinance in collecting ATE penalties. The
text of the ordinance states “a municipal infraction citation will be issued” if a
vehicle owner fails to pay the citation or fails to request the city proceed with a
municipal infraction proceeding. Des Moines, Iowa, Mun. Code § 114-243(d)(3)
(emphasis added). The city did not file a municipal infraction proceeding as
required by its own law, however, and instead proceeded to extrajudicial
collection efforts. Second, the ATE penalties not yet reduced to a judgment were
not liabilities or debts due, owing, and payable when the city referred them to
the income offset program. See Weizberg, 923 N.W.2d at 220; Behm, 922 N.W.2d
at 561. It was the city’s obligation—pursuant to statute, the administrative code,
and its memorandum of understanding with the department of administrative
services—to ensure that the referred accounts were eligible for inclusion in the
income offset program. The city failed to comply with the law and referred
penalties that were not legally enforceable to the income offset program.
The city also contends the plaintiffs’ claim for unjust enrichment fails as
a matter of law because none of the plaintiffs dispute that they committed the
underlying traffic violations. The city is confusing two separate and distinct
30
issues. For the purposes of this claim, it is immaterial whether the recipient of
the citation in fact violated the traffic ordinance. Iowa Code section 364.22, as
interpreted in Behm and Weizberg, requires that the city obtain a judgment in a
municipal infraction proceeding to enforce the penalty against the owner.
Weizberg, 923 N.W.2d at 220; Behm, 922 N.W.2d at 561. It is the legality of the
extrajudicial collection effort—specifically, the holding of the plaintiffs’ income
tax refund—that is at issue and not whether the plaintiffs committed the
underlying offense. Cf. Rilea, 959 N.W.2d at 394 (“But the money Riley paid was
owed to the State as court debt because Rilea was adjudicated guilty in state
district court. . . . The fine is separate from the underlying citation. The payment
Rilea made was a product of a court’s adjudication.” (citation omitted)).
On the relevant point, the Restatement (Third) provides that the payment
of erroneously or illegally assessed taxes may give “the taxpayer a claim in
restitution against the taxing authority as necessary to prevent unjust
enrichment.” Restatement (Third) of Restitution & Unjust Enrichment § 19(1),
at 259. The collection of ATE penalties constitutes a “tax” within the meaning of
the Restatement. Id. (“ ‘Tax’ within the meaning of this section includes every
form of imposition or assessment collected under color of public authority.”). We
thus conclude the district court erred in part in granting the city’s motion for
summary judgment. The district court did not err with respect to Livingood, who
has not paid any ATE penalty and thus has not suffered any injury. The district
court erred with respect to Maury and Robbins, both of whom paid the ATE
penalty. See Kragnes v. City of Des Moines, 810 N.W.2d 492, 513 (Iowa 2012)
31
(affirming unjust enrichment award for illegal collection of franchise fees and
stating that “the most fair remedy in this case is the refund which will, to the
extent possible, refund to members of the plaintiff class the excess fees extracted
from them and restore the parties to the status quo ante”).
Although we conclude the district court erred in granting the city’s motion
for summary judgment, we cannot conclude that plaintiffs Maury and Robbins
were entitled to judgment as a matter of law. The only issue presented to the
district court with respect to unjust enrichment was the legality of the city’s
conduct. The parties did not present to the district court, and the district court
did not determine, whether there are any defenses to the claim of unjust
enrichment and whether there are any disputed issues of material fact
necessitating trial on this claim. For example, the Restatement provides that if
restitution with respect to an erroneously or illegally collected tax “would disrupt
orderly fiscal administration or result in severe public hardship, the court may
on that account limit the relief” available. Restatement (Third) of Restitution &
Unjust Enrichment § 19(2), at 259; see also Kragnes, 810 N.W.2d at 512(discussing rule). And there are more traditional defenses, including, but not
limited to, voluntary payment, consent, waiver, estoppel, limitations, laches, etc.
See, e.g., Hug v. Am. Traffic Sols., Inc., No. 4:14CV00138 ERW, 2014 WL
2611832, at *7 (E.D. Mo. June 11, 2014) (“The voluntary payment doctrine is an
affirmative defense to the claim of unjust enrichment.”); Damon v. City of Kansas
City, 419 S.W.3d 162, 192–94 (Mo. Ct. App. 2013) (discussing unjust enrichment
and voluntary payment doctrine with respect to ATE penalties); Smith v. City of
32
St. Louis, 409 S.W.3d 404, 419–21 (Mo. Ct. App. 2013) (same). We express no
opinion on any of these issues except to say that on this record, the possibility
of defenses and disputed issues of material fact preclude the entry of judgment
as a matter of law for plaintiffs Maury and Robbins. See, e.g., Weizberg,
923 N.W.2d at 221 (“Under the circumstances, we think the best option now is
to vacate the district court ruling regarding unjust enrichment with respect to
the City and remand the matter to the district court for further consideration in
light of our holdings in this case.”).
VIII. Disposition.
We affirm the district court’s judgment in part and reverse in part. We
affirm the district court’s dismissal of the plaintiffs’ claim that the city violated
the statute of limitations. We affirm the district court’s dismissal of the plaintiffs’
claim that the city’s use of the income offset program amounts to an
unconstitutional taking. We affirm the district court’s dismissal of the plaintiffs’
claim for violation of their right to procedural due process. We affirm the district
court’s dismissal of Robbins and Maury’s preemption claims in their entirety
because they are not entitled to any form of relief on this claim. We affirm the
district court’s dismissal of Livingood’s preemption claim to the extent he seeks
damages because preemption is not a cause of action supporting a damages
claim, but we reverse the district court’s dismissal of Livingood’s preemption
claim with respect to his requests for declaratory and injunctive relief. We affirm
the district court’s dismissal of Livingood’s claim for unjust enrichment because
he has not paid any automated traffic citation penalty. We reverse the district
33
court’s grant of summary judgment in favor of the city with respect to Robbins
and Maury’s claim for unjust enrichment. We remand this matter for further
proceedings consistent with this opinion.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
All justices concur and Mansfield, J., files a concurrence.
34
#22–0536, Livingood v. City of Des Moines
MANSFIELD, Justice (concurring).
I join the court’s thorough opinion. In particular, I agree that we have held
in prior automated traffic enforcement (ATE) cases that “no liability arises until
the city takes the affirmative step of filing an enforcement action in district court
and obtains a judgment against the defendant.” Behm v. City of Cedar Rapids,
922 N.W.2d 524, 562 (Iowa 2019); see also Weizberg v. City of Des Moines,
923 N.W.2d 200, 208, 215 n.4 (Iowa 2018). While the City of Des Moines could
structure the situation so that a vehicle owner who requests an administrative
hearing waives their right to a municipal infraction hearing, they have not done
so here. See Behm, 922 N.W.2d at 579–80 (Mansfield, J., concurring in part and
dissenting in part); Weizberg, 923 N.W.2d at 222 (Mansfield, J., concurring in
part and dissenting in part). And, in any event, neither Francis Livingood,
Christopher Maury, nor Daniel Robbins went through the administrative
process; all of them simply ignored the initial notices of ATE violations. As the
court recognizes, it was improper for the city to have a general policy of referring
individuals who had not paid ATE citations to the income tax program without
going through the municipal infraction process in Iowa Code section 364.22.
I also agree with the court that Des Moines Municipal Code section 3-29
is preempted in part by state law. Under state law, participating public agencies
such as the city that wish to refer a liability to the state’s offset program must
provide the alleged debtor with “an opportunity to contest the liability.” Iowa
Code § 8A.504(2)(f)(1) (2017). That is the purpose of section 3-29. The problem,
35
as noted by the majority, is that the section itself forecloses challenges to ATE
penalties “if the recipient of the notice failed to contest the notice pursuant
to section 114-243(2)” or “[i]f a hearing or issuance of a civil citation is not
timely requested pursuant to section 114-243(2) or pursuant to an
administrative hearing available at the time the notice was issued.” Des Moines,
Iowa, Mun. Code § 3-29 (2017).
In short, the administrative procedure provided by the city in section 3-29
was illusory because it didn’t give the individual who had not paid their ATE
citation an opportunity to raise the city’s failure to comply with the municipal
infraction process. Section 3-29 prohibited the vehicle owner from raising the
very thing that made their ATE citation invalid. This flaw was compounded by
the notice that the city sent to Maury and Robbins which stated, “You have
exhausted your legal remedies regarding the validity of this debt.”
Finally, I agree that under these circumstances, Maury and Robbins may
be able to pursue a remedy of unjust enrichment. See Kragnes v. City of
Des Moines, 810 N.W.2d 492, 512 (Iowa 2012); Restatement (Third) of Restitution
& Unjust Enrichment § 19(1), at 259 (Am. L. Inst. 2011). I might conclude
otherwise if the section 3-29 administrative remedy were not illusory. In other
words, if Maury and Robbins had a genuine opportunity to contest the offset on
the ground that the ATE citation was not a valid debt, then failure to exhaust
that administrative remedy might bar their claims. See Restatement (Third) of
Restitution & Unjust Enrichment § 19(1), at 259 (“Except to the extent that a
different rule is imposed by statute . . . .”); id. § 19(1) cmt. g, at 267 (“The taxing
36
authority may establish administrative procedures for refund claims, and state
law may require their exhaustion as a precondition of a suit in restitution.”). The
city is required to conduct such hearings “in a manner substantially equivalent
to that provided under Iowa Code chapter 17A,” Iowa Admin. Code r. 11—40.4(6),
and we have held that failure to exhaust an administrative remedy under chapter
17A is fatal to a plaintiff’s claim, Ghost Player, L.L.C. v. State, 860 N.W.2d 323,
326 (Iowa 2015) (“When a party fails to exhaust all of its required administrative
remedies, the court has no authority to hear the case . . . .”). However, “an
administrative remedy should be adequate in order to be deemed exclusive.”
Bass v. J.C. Penney Co., 880 N.W.2d 751, 760 (Iowa 2016).
With these observations, I join the court’s opinion.