Larimore Pub. Sch. Dist. No. 44 v. Aamodt

908 N.W.2d 442

LARIMORE PUBLIC SCHOOL DISTRICT NO. 44, a political subdivision of the State of North Dakota; and the North Dakota Insurance Reserve Fund, Plaintiffs and Appellees

v. John AAMODT and Jennifer Aamodt, individually and as the parents and guardians and on behalf of minor children CLA, KHA, and SMA; Michael Schwab and Carrie Schwab, individually and as the parents and guardians on behalf of minor child CJS; Melissa Erickson, individually and as the parent and guardian, and on behalf of minor child CRS; Carrie Schwab, individually and as the parent and guardian on behalf of minor children DMB and EXB; Paul Sandstrom and Judy Sandstrom, individually and as the parents and guardians on behalf of minor children CBS and MBS, Defendants and AppellantsandMichael Schwab, individually and as the parent and guardian, and on behalf of minor child CRS; Doug Sullivan, individually and as the noncustodial biological father and on behalf of minor child EXB; Juan Carrera and Martha Carrera, individually and as the parents and custodial guardians and on behalf of minor children CMC and VC; Rita Corona, individually and as the noncustodial biological mother and on behalf of minor children CMC and VC; Juan Carrera Jr., individually and as the noncustodial biological father and on behalf of minor children CMC and VC; Jeff Fuqua and Odella Fuqua, individually and as the parents and guardians and on behalf of minor children JMF and JMF; BNSF Railway Company, a Delaware corporation; Altru Health System, a North Dakota nonprofit corporation; Children’s Health Care, a Minnesota nonprofit corporation; Essentia Health, a Minnesota nonprofit corporation; Sanford Medical Center Fargo, d/b/a Sanford, a North Dakota non-profit corporation; Sanford, d/b/a Sanford Health, a North Dakota nonprofit corporation; Face and Jaw Surgeons, P.C. d/b/a Face and Jaw Center and Face and Jaw Surgery Clinic; Larimore Ambulance Service ; the State of North Dakota by and through the North Dakota Department of Human Services, an agency of the State of North Dakota; and Matthew J. Volk, DDS, PC, Defendants

No. 20170258

Supreme Court of North Dakota.

Filed March 19, 2018

Daniel L. Gaustad (argued), Grand Forks, ND, Joseph E. Quinn (on brief) and Ronald F. Fischer (on brief), Fargo, ND, for plaintiffs and appellees Larimore Public School District No. 44, a political subdivision of the State of North Dakota; and the North Dakota Insurance Reserve Fund.

Robert S. Peck (argued), New York, NY, for defendants and appellants John Aamodt and Jennifer Aamodt, individually and as the parents and guardians and on behalf of minor children CLA, KHA, and SMA; Michael Schwab and Carrie Schwab, individually and as the parents and guardians on behalf of minor child CJS; Melissa Erickson, individually and as the parent and guardian, and on behalf of minor child CRS; Carrie Schwab, individually and as the parent and guardian on behalf of minor children DMB and EXB; and Paul Sandstrom and Judy Sandstrom, individually and as the parents and guardians on behalf of minor children CBS and MBS.

H. Patrick Weir, Jr. (appeared) and Andrew D. Smith (on brief), Fargo, ND, for defendants and appellants John Aamodt and Jennifer Aamodt, individually and as the parents and guardians and on behalf of minor children CLA, KHA, and SMA.

Michael J. Williams (appeared) and Duane A. Lillehaug (on brief), Fargo, ND, for defendants and appellants Michael Schwab and Carrie Schwab, individually and as the parents and guardians on behalf of minor child CJS; and Carrie Schwab, individually and as the parent and guardian on behalf of minor children DMB and EXB.

Kim E. Brust (appeared), Fargo, ND, for defendants and appellants Paul Sandstrom and Judy Sandstrom, individually and as the parents and guardians on behalf of minor children CBS and MBS.

Timothy M. O’Keeffe (on brief) and Tatum O’Brien Lindbo (on brief), Fargo, ND, for defendant and appellant Melissa Erickson, individually and as the parent and guardian, and on behalf of minor child CRS.

Matthew A. Sagsveen, Solicitor General, Bismarck, ND, for amicus curiae State of North Dakota.

Timothy Q. Purdon, Bismarck, ND, and Nicole S. Frank, Minneapolis, MN, for amicus curiae North Dakota Association for Justice.

Stephanie E. Dassinger, Bismarck, ND, for amicus curiae North Dakota League of Cities and North Dakota Recreation & Park Association.

Amy L. De Kok, Bismarck, ND, for amicus curiae North Dakota School Boards Association.

Aaron G. Birst, Bismarck, ND, for amicus North Dakota Association of Counties.

McEvers, Justice.

[¶ 1] The parents of nine minor children, individually and as guardians of the children, appeal from a district court judgment determining the statutory damage cap for tort claims against a political subdivision is constitutional. The parents argue the damage cap violates the open court, jury trial, equal protection, and special law provisions of the state constitution. We conclude the damage cap does not violate those constitutional provisions, and we affirm the judgment.

I

[¶ 2] The Larimore Public School District serves a rural area in northeast North Dakota with an enrollment of about 400 children and a total population base of 2,571 people. According to Superintendent Roger Abbe, the School District provides required core curriculum and special education services, elective courses, and extra-curricular activities for its students and ranks in the top twenty percent in the State for property tax mill levies. According to Abbe, the School District’s anticipated revenues for the 2015–2016 and 2016–2017 school years ranged between five million five hundred thousand dollars and five million six hundred thousand dollars and the School District’s expenses for those years exceeded its revenues, requiring use of interim funds to pay the excess expenses.

[¶ 3] In January 2015, a collision occurred between a School District bus and a BNSF Railway train. At the time, there were thirteen School District students riding home from school on the bus. One child died as a result of injuries sustained in the accident and the other children suffered serious injuries. The accident resulted in the potential for multiple damage claims in excess of the School District’s aggregate statutory cap on liability under the codification of N.D.C.C. § 32–12.1–03(2) in effect at the time of the accident, which limited the liability of political subdivisions "to a total of two hundred fifty thousand dollars per person and five hundred thousand dollars for injury to three or more persons during any single occurrence regardless of the number of political subdivisions, or employees of such political subdivisions, which are involved in that occurrence." See 2015 N.D. Sess. Laws ch. 242, § 1 (amending statute to increase the limit of liability for political subdivisions to a total of two hundred fifty thousand dollars per person and one million dollars for any number of claims arising from any single occurrence).

[¶ 4] The School District and its government self-insurance pool, the North Dakota Insurance Reserve Fund, brought this interpleader action and deposited five hundred thousand dollars with the district court to satisfy the damage cap for claims arising from the accident under the applicable language of N.D.C.C. § 32–12.1–03(2). The parents and guardians for some of the children answered and counterclaimed, asserting the damage cap was unconstitutional. The parties stipulated to certain facts for purposes of a motion for summary judgment on the constitutional claims, including that at the time of the accident, the bus driver was a School District employee acting within the scope of his employment, that the bus driver’s negligence was the sole proximate cause of the accident and the injuries, and that the total damages from the accident would exceed three million dollars. The parties also stipulated that the Insurance Reserve Fund provided the School District with a memorandum of coverage authorizing additional liability coverage in the amount of two million dollars for any one accident or loss "in the event of a judicial determination that the statutory limit of liability is not applicable to a specific occurrence."

[¶ 5] The district court ruled the damage cap did not violate the open court, jury trial, equal protection, or special law provisions of the North Dakota Constitution. The court confirmed the five hundred thousand dollar deposit and discharged the School District and the Insurance Reserve Fund from any further liability for damages from the accident.

II

[¶ 6] The parents argue the damage cap for tort claims against political subdivisions in N.D.C.C. § 32–12.1–03(2) violates the open court, jury trial, equal protection, and special law provisions of the North Dakota Constitution.

[¶ 7] In considering the parents’ constitutional arguments, our inquiry is guided by several well-established rules:

Whether a statute is unconstitutional is a question of law, which is fully reviewable on appeal. " ‘All regularly enacted statutes carry a strong presumption of constitutionality, which is conclusive unless the party challenging the statute clearly demonstrates that it contravenes the state or federal constitution.’ " " ‘The justice, wisdom, necessity, utility and expediency of legislation are questions for legislative, and not for judicial determination.’ " This Court exercises the power to declare legislation unconstitutional with great restraint. Under N.D. Const. art. VI, § 4, this Court "shall not declare a legislative enactment unconstitutional unless at least four of the members of the court so decide."

Teigen v. State , 2008 ND 88, ¶ 7, 749 N.W.2d 505 (citations omitted).

[¶ 8] In assessing the parents’ constitutional arguments, we also recognize other courts have generally held that statutory damage caps for tort claims against governmental entities do not violate similar constitutional provisions. See James L. Isham, Annot., Validity and Construction of Statute...