Title: SCOTT and CONNIE HEIMER v. ANTELOPE VALLEY IMPROVEMENT and SERVICE DISTRICT

State: wyoming

Issuer: Wyoming Supreme Court

Document:

SCOTT and CONNIE HEIMER v. ANTELOPE VALLEY IMPROVEMENT and SERVICE DISTRICT2010 WY 29226 P.3d 860Case Number: No. S-08-0169Decided: 03/18/2010
OCTOBER 
TERM, A.D. 2009

 
 
SCOTT 
and CONNIE HEIMER,Appellants(Plaintiffs),v.ANTELOPE 
VALLEY IMPROVEMENT and SERVICE 
DISTRICT,Appellee(Defendant).

 
 
Appeal 
from the District Court of Campbell County

The 
Honorable John R. Perry, Judge

 
 

Representing 
Appellant:

Tom 
C. Toner and Kendal R. Hoopes of Yonkee & Toner, LLP, Sheridan, 
Wyoming.  Argument by Mr. 
Toner.

 
 

Representing 
Appellee:

Rick 
L. Koehmstedt of Schwartz, Bon, Walker & Studer, LLC, Casper, 
Wyoming.

 
 
Before 
VOIGT, C.J., and GOLDEN, HILL, KITE, BURKE, JJ.

 
 

KITE, 
Justice.

 
 
[¶1]      Scott and Connie 
Heimer claim a water main maintained by the Antelope Valley Improvement and 
Service District (the District) leaked for several years causing damage to their 
Campbell County residence.  In 2004, 
the water main broke, allegedly causing additional damage to the Heimers' 
property.  The Heimers filed a 
governmental claim against the District and subsequently brought suit in 
district court.  The District moved 
for summary judgment, arguing that the Heimers' action was barred because they 
failed to file their governmental claim within the statutory time limit.  The district court granted summary 
judgment in favor of the District, and the Heimers appealed.  We conclude there are material issues of 
fact as to when the Heimers discovered or should have discovered the District's 
act, error or omission with respect to the water leak and as to whether the 
water main break was a separate incident.  
Consequently, we reverse and remand.

 
 
ISSUES

 
 
[¶2]      The Heimers 
present two issues:

 
 
1.         
Is there a genuine issue of material fact concerning whether Heimers' 
claims were timely under Wyo. Stat. Ann. § 1-39-113(a) when Heimers did not 
discover what was causing the subsidence to their property, despite diligent 
efforts to do so, until November 19, 2004?

 
 
2.         
Were the Heimers' claims for damages resulting from the total separation 
of the District's water main occurring on November 30, 2004, which was a 
separate incident of negligence, timely under Wyo. Stat. Ann. § 
1-39-113(a)?

 
 
Although 
phrased more generally, the District states a similar 
issue.

 
 
FACTS

 
 
[¶3]      Because we are 
reviewing a summary judgment, we state the facts in the light most favorable to 
the non-movants, the Heimers.  The 
Heimers bought their residence in 1999.  
In 2002, they began to notice cracks in the sheetrock and flooring of 
their home, but they did not know what was causing the damage.  On February 7, 2002, the Heimers had the 
underground water and sewage pipes servicing their residence tested to see if 
fluid seepage from these lines was a possible cause of the problems.  The results of the tests showed no 
leakage from those pipes.  

 
 
[¶4]      During 2002 and 
2003, the residence continued to incur damage and it became apparent that the 
foundation was failing.  In June 
2004, the Heimers hired an engineering firm to determine the moisture contents 
of the soil on the lot.  Testing of 
a single borehole revealed elevated moisture contents in the soil between five 
and fifteen feet below the surface.  
The final engineering report did not specify the source of the moisture 
in the soil or whether the elevated moisture levels were causing the subsidence 
problem.  

 
 
[¶5]      After receiving 
the engineering report, the Heimers began trying to determine the source of the 
excess moisture.  They recognized 
one possible source was the District's water main that ran parallel to the 
street in front of their residence.  
In July 2004, the Heimers, through legal counsel, contacted the District 
by letter.  They stated their home 
was experiencing severe subsidence problems and they were attempting to locate 
"a source, or sources, of water that may be contributing to their subsidence 
problem."  The Heimers requested 
permission to test the water main for leaks because they had "been advised to 
confirm that water is not leaking from your water system."    

 
 
[¶6]      The District 
refused to allow the Heimers to test its water main, indicating that they had to 
rule out other possible causes of the subsidence before it would allow them to 
do so.  Specifically, the District 
suggested the Heimers check for sources of surface water, elevated ground water 
levels, problems with their septic system, or settling of the home because it 
was constructed on fill dirt.    

 
 
[¶7]      Soon thereafter, 
the Heimers contacted the man who built their house and were informed that the 
residence was built on virgin land, not fill dirt.  They were also informed no water or wet 
ground was discovered in any of the holes dug on the property during 
construction.  

 
 
[¶8]      On September 7, 
2004, the Heimers sent another letter to the District.  This letter informed the District that 
the original borehole testing revealed "a water source from the direction of 
[the District's] water system."  It 
also related the information gleaned from the builder.  The letter further stated that the 
Heimers' "septic system is downhill from the water source and, in fact, is 
suffering from the same inundation of water as the house."  The Heimers asserted that they had 
diligently investigated their problem as objectively as possible and had come to 
the point where checking the District's water main for leaks was "a next logical 
step."  In a letter dated September 
28, 2004, the District again denied the Heimers' request to test the main, 
insisting the Heimers had not "taken sufficient steps to eliminate other causes" 
of the subsidence.  

 
 
[¶9]      The Heimers then 
hired Western Water Consultants (WWC) to conduct sampling and borehole analysis 
in five additional locations on the property.  WWC outlined its test results in a report 
dated November 19, 2004.  The report 
stated that elevated soil moisture contents had been found in the holes close to 
the water main and between the water main and the Heimers' residence.      

 
 
[¶10]   On November 22, 2004, the Heimers 
again contacted the District, requesting permission to check the water main for 
leaks.  On November 30, 2004, before 
the issue was addressed, the water main separated under the road running in 
front of the Heimers' residence and 90,000 gallons of water were released over a 
ten hour period.  The Heimers stated 
this break in the water main caused flooding around their home and damage to 
their driveway.  

 
 
[¶11]   Over the next couple of years, the 
condition of the Heimers' residence further deteriorated and, even after the 
water main break was repaired, the soils around their home remained saturated 
with water.  Finally, on October 19, 
2006, the Heimers delivered their governmental claim, dated October 18, 2006, to 
the District.  In the notice of 
claim they stated that by the summer of 2004, they were "suspicious of the 
District's water main as [a] possible cause of their problem."  Once they received the results of the 
testing by WWC in November 2004, they "had more than a strong suspicion that the 
cause of their home damage was a leak in the water main."    

 
 
[¶12]   The Heimers filed the instant 
action against the District on October 30, 2006, alleging negligence, inverse 
condemnation, and fraud and requesting a permanent injunction and damages.  The District answered generally and then 
moved for partial summary judgment, asserting the Heimers' action was barred 
because they had not presented their governmental claim within two years of the 
District's alleged wrongdoing as required by Wyo. Stat. Ann. § 1-39-113(a) 
(LexisNexis 2009).  

 
 
[¶13]   In response, the Heimers argued 
their claim was timely because the limitation period did not begin to run until 
they received the WWC report in November 2004.  Mr. Heimer submitted an affidavit in 
response to the District's summary judgment motion.  He averred that, after receiving the WWC 
report, he became "fairly certain the cause of my damage was from the District's 
water main . . . ."  The district 
court determined the Heimers' letter to the District dated September 7, 2004, 
revealed they had discovered their claim against the District.  Consequently, the district court ruled 
that the Heimers' October 18, 2006, governmental claim was untimely and granted 
the District's motion for partial summary judgment.1  The Heimers appealed.   

 

STANDARD 
OF REVIEW

 
 
[¶14]   Our standard of review for summary 
judgments states:

 
 
            
On appeal, this Court evaluates the propriety of a district court's 
summary judgment ruling by examining the same materials and following the same 
standards as the district court.  We 
examine the record de novo in the light most favorable to the party opposing the 
motion, giving that party the benefit of all favorable inferences which may be 
fairly drawn from the record.  If 
upon review of the record, doubt exists about the presence of genuine issues of 
material fact, we resolve that doubt against the party seeking summary 
judgment.  We review questions of 
law de novo without giving any deference to the district court's 
determinations.  If we can uphold 
summary judgment on any proper legal basis appearing in the record, we 
will.  

 
 

Wagner 
v. Reuter, 
2009 WY 75, ¶ 11, 208 P.3d 1317, 1321-22 (Wyo. 2009) (internal citations 
omitted).  See also, Cheek v. Jackson Wax Museum, Inc., 2009 
WY 151, ¶ 12, 220 P.3d 1288, 1290 (Wyo. 2009).  

 
 
DISCUSSION

 
 
[¶15]   The District is a governmental 
entity.  Although governmental 
entities are traditionally immune from suit under the doctrine of sovereign 
immunity, the Wyoming legislature recognized "the inherently unfair and 
inequitable results which occur in the strict application of governmental 
immunity" and enacted the Wyoming Governmental Claims Act, Wyo. Stat. Ann. §§ 
1-39-101 through 1-39-121 (LexisNexis 2009).  Section 1-39-102(a).  Among the provisions included in the 
Wyoming Governmental Claims Act is the procedure to be followed in pursuing a 
claim against a governmental entity.  
Section 1-39-113.  Strict 
adherence to this procedure is required.  
Bell v. Schell, 2004 WY 153, ¶ 
10, 101 P.3d 465, 468 (Wyo. 2004); Beaulieu v. Florquist, 2001 WY 33, ¶¶ 
17-18, 20 P.3d 521, 527 (Wyo. 2001); and Wyo. Const. Art. 16, § 
7.

 
 
[¶16]   Section 1-39-113(a) sets out the 
limitation period for bringing a governmental claim:  

 
 
   (a) No action shall be brought 
under this act against a governmental entity unless the claim upon which the 
action is based is presented to the entity as an itemized statement in writing 
within two (2) years of the date of the alleged act, error or omission, except 
that a cause of action may be instituted not more than two (2) years after 
discovery of the alleged act, error or omission, if the claimant can establish 
that the alleged act, error or omission was:

(i) 
Not reasonably discoverable within a two (2) year period; 
or

            
(ii) The claimant failed to discover the alleged act, error or omission 
within the two (2) year period despite the exercise of due diligence.  

 
 
            
Water Main Leak

 
 
[¶17]     Section 1-39-113(a) requires claimants 
to present their claim within two years of when they knew or should have known, 
with the exercise of due diligence, of the governmental entity's "alleged act, 
error or omission."  The exact date 
of the beginning of the leak in this case, and accordingly, the date of the 
District's alleged act, error or omission is undetermined.  The discovery rule contained in the 
statute is, therefore, squarely at issue.

 
 
[¶18]   The application of the discovery 
rule to a statute of limitations involves a mixed question of law and fact; 
consequently, the entry of summary judgment on the issue of when a statute of 
limitations commences to run is typically inappropriate.  See, e.g., Cathcart v. Meyer, 
2004 WY 49, ¶ 30, 88 P.3d 1050, 1062-63 (Wyo. 2004); Murphy v. Housel & 
Housel, 955 P.2d 880, 883 (Wyo. 1998).  The question can only be resolved as a 
matter of law if uncontroverted facts establish when a reasonable person should 
have been placed on notice of his claim.  
Hiltz v. Robert W. Horn, P.C., 
910 P.2d 566, 569 (Wyo. 1996).  

 
 
[¶19]   The District argued, and the 
district court agreed, that the Heimers discovered that the District's act, 
error or omission was the cause of the damage to their home at least by 
September 7, 2004, and their letter of that date demonstrated that 
discovery.  We agree that one 
plausible interpretation of the evidence is that the Heimers' September 7, 2004, 
letter indicated that they had discovered the District's act, error or omission, 
thereby triggering the two year limitation period.  However, our standard of review demands 
that we evaluate the evidence in the light most favorable to the non-moving 
party.  

 
 
[¶20]   Beginning in 2002, the Heimers knew 
that something was causing the soil underlying their home to subside.  The Heimers provided evidence in 
response to the District's summary judgment motion indicating they were unable 
to determine the subsidence problem was most likely being caused by a continuous 
water leak in the District's water main until detailed borehole testing was 
completed by WWC on November 19, 2004.  
Prior to that, the Heimers had engaged in an on-going effort to determine 
the cause of the subsidence.  They 
conducted tests on their own sewer and water lines which did not reveal any 
problems.  During the summer of 
2004, the Heimers had an engineering firm test the moisture in the soils 
surrounding their house, which showed elevated moisture levels in the soil, but 
did not specify whether this moisture level was causing the subsidence or the 
source of the moisture.   The 
Heimers repeatedly asked for permission to conduct leak tests on the District's 
water main, but the District refused and insisted that they needed to rule out 
other causes of the subsidence.  The 
Heimers followed the District's direction to look into other causes.     

 
 
[¶21]   Although the District argued in its 
motion for summary judgment that the Heimers had discovered the leak was the 
cause of the subsidence as of September 7, 2004, its September 28, 2004, letter 
declared that the Heimers had not yet ruled out other causes to establish that 
the District was responsible for their damage.  The District's letter stated "the 
testing' which has been done by [Mr. Heimer] has not eliminated other 
potential causes of his household problems . . . .  In any event, the District is not 
willing to allow your clients to test the water lines at this juncture absent 
information from [Mr. Heimer] that he has taken sufficient steps to eliminate 
other causes of his house problems." (Emphasis added.) 

 
 
[¶22] 
In response to the District's September 28th 
letter, the Heimers engaged WWC to do the detailed borehole testing.  WWC drilled five more boreholes and the 
results provided to the Heimers on November 19, 2004, indicated that the excess 
water was coming from the direction of the District's main.  When all of the evidence is reviewed, 
there appear genuine issues of material fact as to whether the Heimers 
discovered, or should have discovered,  
the District's act, error or omission by September 7, 2004, and whether 
due diligence required the Heimers to discover the continuous water leak prior 
to November 19, 2004.  Those issues 
of material fact should be determined at trial.

 
 
[¶23]   The district court relied on 
Rawlinson v. Cheyenne Board of Public Utilities, 2001 WY 6, 17 P.3d 13 
(Wyo. 2001) in granting summary judgment in favor of the District.  Rawlinson filed a governmental claim and 
sued the Cheyenne Board of Public Utilities (BOPU) alleging property damage 
caused by a leaking fire hydrant.  This Court held that the governmental 
claim period began to run when the homeowner discovered the water was causing 
the damage to her property even though she claimed she had not yet discovered 
who was responsible.  Id., ¶ 
16, 17 P.3d  at 17.  Rawlinson 
held that "[o]nce [the 
plaintiff] knows or should know the cause of that injury, he must 
investigate the situation and ascertain who might be legally culpable."  Id., ¶ 15, 17 P.3d  at 17, 
discussing Redenz v. Rosenberg, 520 A.2d 883, 886 (Pa. Super. Ct. 1987) (emphasis omitted).  This is consistent with § 1-39-113(a) 
which requires the claimant to use due diligence to discover a governmental 
entity's "act, error or omission." 

 
 
[¶24]   Rawlinson is readily distinguishable from the instant 
case.  It was undisputed that 
Rawlinson knew the water seepage had been causing damage to her property for 
several years and had considered the governmental entity as a possible cause of 
her damage for some time.  Although 
the Rawlinson opinion did not 
directly address the issue of whether the homeowner had acted with due 
diligence, it was apparent that the homeowner knew about the water seepage at 
the time she purchased the house, and had over three years to determine whether 
the BOPU was, in fact, the cause.  In contrast, no obvious water seepage 
existed in the instant case.  The 
evidence can be interpreted as indicating there were several potential causes of 
the subsidence, with excess water being one, and the Heimers did not know what 
was causing the subsidence until they received WWC's report.  In addition, the question of whether 
they acted with diligence to determine the cause of the subsidence and discover 
the District's act, error or omission is squarely raised.   In fact, the district court stated in its 
decision letter:  "Over the course 
of time, plaintiffs undertook what appears to be a diligent investigation of 
various causes for the structure problems at their residence and it is safe to 
say that identifying the cause with certainty was not an easy matter."   

 
 
[¶25]   This case is also distinguishable 
from Rawlinson because the District actually interfered with the Heimers' 
efforts to discover the cause of the subsidence.  In Rawlinson, the BOPU was 
cooperative when the homeowner complained and even conducted tests on its water 
system to check for leaks.  Rawlinson, ¶ 16, 17 P.3d  at 
17.  The BOPU's actions and the 
length of time the homeowner was aware of the water seepage distinguish that 
case from the issue presented here.

 
 
[¶26]   Although the Heimers knew that 
water was a potential cause of the subsidence before November 19, 2004, one 
plausible interpretation of the evidence is that they reasonably did not 
discover the District's act, error or omission until they received WWC's 
report.  Under these circumstances, 
material issues of fact exist as to when the Heimers knew or should have known 
that the District's act, error or omission caused their damages and whether they 
acted with due diligence to discover the cause.  

 
 
            
Water Main Break

 
 
[¶27]   The district court did not 
separately address the water main break in its summary judgment decision letter, 
apparently believing the break was related to the long term water leak and 
thereby governed by the same limitation period.  The Heimers argue the break in the water 
main on November 30, 2004, was a separate incident, involving a separate 
limitation period.

  

[¶28]   The issue of what constitutes a new 
event for purposes of a governmental claim was addressed in Waid v. State of Wyoming, Dep't of 
Transportation, 996 P.2d 18 (Wyo. 2000).  In that case, the Department of 
Transportation installed culverts of insufficient capacity to carry excess rain 
water.  The plaintiffs filed a 
governmental claim in 1995 alleging that their property had been damaged by 
floods in 1987 and 1993 as a result of the deficiency in the culverts.  The Department of Transportation argued 
the plaintiffs' claims were barred under the Wyoming Governmental Claim 
Act.  The plaintiffs conceded that 
their claim for damage associated with the 1987 flood was time barred, but 
maintained that the second flood triggered a new limitation period.  Relying on the plain language of § 
1-39-113, this Court ruled that the plaintiffs' claim accrued as of the date of 
the first flood in 1987.  "The 
situation had not changed by 1993, and although that flood caused additional 
damage, there was no new act, error or omission,' or a fresh discovery of such 
that would cause the statutory time period to start anew."  Waid, 996 P.2d  at 
25.

 
 
[¶29]   Although the circumstances 
presented in the instant case are different, the reasoning in Waid is instructive and informs our 
decision here.  The alleged error 
made by the governmental entity in Waid was the improper design of the 
culvert.  That error was 
discoverable after the first flood and, consequently, the limitation period 
began at that time.  The fact that 
the plaintiffs suffered additional damages as the result of a second flood did 
not change the time when the governmental entity's act, error or omission was 
discoverable.  In the instant case, 
the question is whether the same act, error or omission caused both a water main 
leak and the water main break or whether there were two different acts, errors 
or omissions resulting in two separate claims and two distinct limitation 
periods.  

 
 
[¶30]   The evidence presented in the 
summary judgment submissions indicated that the water main separated at a joint, 
which showed no signs of "wear markers' which would support[] a claim of long 
term leaking problems."  That 
evidence implies that the joint that separated was not the source of a long-term 
leak.  An engineering report 
indicated that the separation was caused by differential movement in the 
supporting soil, creating a factual question about the cause of such 
movement.  The answer to that 
question could raise other factual questions as to whether the separation was 
caused by an act, error or omission by the District and whether it was related 
to the alleged water main leak.  The 
facts need to be further developed before the beginning of the limitation period 
for the water main break can be established.  Therefore, summary judgment was 
inappropriate on this issue.

 
 
[¶31]   On remand, the fact finder will 
need to determine whether the water main break involved the same act, error or 
omission as the alleged long term water leak.  If so, then the fact finder's 
determination on the discovery issue discussed above will determine the start of 
the limitation period for the water main break.  However, if the fact finder determines 
that the water main break was not related to a long term leak, then the date of 
the break, November 30, 2004, would mark the beginning of a new limitation 
period and the Heimers' filing of their governmental claim on October 19, 2006 
was timely. 

 
 
CONCLUSION

 
 
[¶32]   Genuine issues of material fact 
exist as to when the statute of limitation began running on the Heimers' water 
leak claim.  The fact finder must 
determine when the Heimers discovered or should have discovered the District's 
"act, error or omission" for purposes of starting the limitation period.   Moreover, there are genuine issues of 
material fact surrounding the commencement of the limitation period on the 
Heimers' claim for damages associated with the water line 
break.

 
 
[¶33]   Reversed and remanded for further 
proceedings consistent with this opinion. 

 
 
FOOTNOTES

 
 

1The motion 
for summary judgment was entitled "Motion for Partial Summary Judgment" and the 
Order followed suit.  The Order did 
not contain a certification under W.R.C.P. 54(b) allowing immediate appeal of 
the Order.  Under the circumstances, 
however, we do not believe this raises a jurisdictional problem.  The only issue not expressly decided by 
the district court was the Heimers' claim for injunctive relief.  As the district court noted in its 
decision letter, its ruling on the issues at hand was dispositive of all issues 
in the litigation.  For all 
practical purposes, the order before us for review is 
final.