IN THE SUPREME COURT OF IOWA

No. 18–1545

Submitted September 17, 2020—Filed October 23, 2020

BRIAN TERRY and LISA TERRY,

Appellants,

vs.

MEGAN DOROTHY,

Appellee.

On review from the Iowa Court of Appeals.

Appeal from the Iowa District Court for Story County, Bethany 

Currie, Judge.

Appellee seeks further review of the court of appeals decision 

vacating the district court’s grant of summary judgment. DECISION OF 

COURT OF APPEALS VACATED; DISTRICT COURT GRANT OF 

SUMMARY JUDGMENT AFFIRMED.

Appel, J., delivered the opinion of the court, in which all justices 

joined.

Sarah M. Baumgartner (argued) of Hedberg & Boulton, P.C., 

Des Moines, for appellants.

Charles A. Blades (argued) and Valerie A. Foote of Smith Mills 

Schrock Blades Monthei, P.C., Cedar Rapids, for appellee.
2

APPEL, Justice.

In this case, we consider whether settlement documents submitted 

to and approved by the workers’ compensation commissioner released 

common law claims that the employee brought against a coemployee 

alleging gross negligence. On a motion for summary judgment, the district 

court found that the settlement precluded the employee from bringing the 

gross negligence claim against the coemployee. The employee appealed.

We transferred the case to the court of appeals. The court of appeals 

reversed. We granted further review. For the reasons expressed below, we 

affirm the ruling of the district court dismissing the employee’s gross 

negligence claim against the coemployee.

I. Factual and Procedural Background.

A. Introduction. On October 14, 2015, Brian Terry, an employee 

of Lutheran Services in Iowa (LSI) was attacked by a client of LSI, allegedly 

causing serious injuries. Brian filed a workers’ compensation claim 

against LSI and its workers’ compensation carrier. The parties ultimately 

resolved the workers’ compensation dispute in a compromise settlement. 

Two settlement documents were presented to the Iowa Workers’

Compensation Commissioner pursuant to Iowa Code section 85.35(3)

(2015). One was titled “Compromise Settlement” and the other was titled 

“Additional Terms of Settlement.” The commissioner ultimately approved 

the settlement. 

B. Settlement Documents Presented to Commissioner.

1. Compromise settlement. The compromise settlement declared

that “[t]he undersigned parties submit this Compromise Settlement 

pursuant to Iowa Code [section] 85.35(3).” The compromise settlement 

further described the dispute as follows:
3

A dispute exists under the Iowa Workers’ Compensation Law, 

which the parties seek to resolve by full and final compromise 

disposition of Claimant’s claim for benefits. The subject and 

nature of the dispute is whether Claimant’s alleged 

October 14, 2015 work injury caused permanent impairment 

and permanent disability and, if so, the extent of permanent 

disability. 

The compromise settlement contained release language. It provided 

that “[i]n consideration of this payment, claimant releases and discharges 

the above employer and insurance carrier from all liability under the Iowa 

Workers’ Compensation Law for the above compromised claim.” 

2. Additional terms of settlement. The parties also presented to the 

commissioner a document entitled “Additional Terms of Settlement.” The 

compromise settlement expressly incorporated the additional terms of 

settlement.

The additional terms of settlement stated that the “[d]efendants [LSI 

and West Bend Mutual Insurance] agree to pay Claimant [Brian Terry] a

lump sum of $45,000 in new money.” In return, the claimant, Brian,

agreed that,

the payment of $45,000 is acceptable to Claimant as a full 

and final compromised settlement, satisfaction, and final 

discharge of all claims and demands that may exist against 

Lutheran Services of Iowa, Inc, West Bend Mutual Insurance 

Company, and any of their . . . employees . . . by reason of his 

employment and by reason of all injuries or damages 

sustained by Claimant on or about October 14, 2015, through 

his association with the Released Parties. 

The additional terms of settlement further provided, “In consideration of 

this payment, Claimant releases and discharges the Released Parties from 

all liability, including liability under Iowa Workers’ Compensation Law, for 

the above injury or injuries . . . known or unknown . . . .”

C. Proceedings Before the District Court.

1. Brian and Lisa Terry petition. On October 12, 2017, Brian and 

Lisa Terry filed a petition at law in district court. They sought to recover 
4

damages from Megan Dorothy, a supervisor of Brian’s when he worked at 

LSI, on a gross negligence theory. Count I of the petition alleged gross 

negligence when Dorothy put Brian in a one-on-one situation with a client 

where the likelihood of assault was probable and the situation ultimately 

resulted in injuries to Terry. Count II of the petition alleged that the 

traumatic brain injury suffered by Brian as a result of Dorothy’s gross 

negligence had an adverse impact on the Terrys’ marriage. 

2. District court ruling on motion for summary judgment. Dorothy 

moved for summary judgment, seeking to dismiss the action. In her 

moving papers, Dorothy asserted alternative grounds, including relying 

upon “release language that releases plaintiffs’ co-employee gross 

negligence claim against the defendant Dorothy.” 

The district court granted Dorothy’s motion for summary judgment 

on both contract and statutory grounds. According to the district court,

Mr. Terry lost any further rights to pursue damages under 

Iowa Code section 85.20 for gross negligence against a coemployee both because the Additional Terms of Settlement 

specifically include a release for all co-employees and because 

Iowa Code section 85.35(9) provides that a compromise 

settlement approved by the Commissioner is a final bar to any

further rights under chapter 85 . . . .

The district court next turned to Lisa Terry’s consortium claim. The 

district court reasoned that in order to bring a consortium claim, there 

must be liability on the underlying claim that caused injuries to the other 

spouse. Because the district court dismissed Brian’s gross negligence 

claim, the district court reasoned that Lisa’s consortium claim must also 

fail. 

3. Decision of court of appeals. The Terrys appealed. We transferred 

the case to the court of appeals. The majority in the court of appeals 

reversed. The majority emphasized that a claim of gross negligence is a 
5

common law claim distinct and apart from a workers’ compensation claim. 

The majority thus reasoned that the statutory settlement before the 

workers’ compensation commissioner extinguished all statutory claims

but a settlement with the workers’ compensation commissioner did not 

release a common law claim of gross negligence against a coemployee. 

While the majority recognized there might be a claim for summary 

judgment based upon the contractual terms of the additional terms of 

settlement, independent of any approval by the workers’ compensation 

commissioner, the majority found that contractual theory was not before 

the court. According to the majority, Dorothy exclusively relied upon the 

premise that a gross negligence claim against a coemployee was part and 

parcel of a workers’ compensation claim and that the commissioner’s 

action in approving the settlement extinguished the gross negligence 

claim. A dissent, however, agreed that a gross negligence claim against a 

coemployee was not a statutory claim under Iowa Code section 85.20 but 

reasoned that the contract theory was, in fact, addressed by the district 

court and sufficiently presented on appeal to provide a basis to affirm the 

district court. 

II. Standard of Review.

This case involves review of a district court’s order on a motion for 

summary judgment. A district court’s summary judgment ruling is 

reviewable for correction of errors at law. Bandstra v. Covenant Reformed 

Church, 913 N.W.2d 19, 36 (Iowa 2018). 

III. Discussion.

A. Summary Judgment Based On Statutory Theory. We first 

consider whether a gross negligence claim against a coemployee is a 

statutory claim that is extinguished under Iowa Code section 85.20 when 

the workers’ compensation commissioner approved settlement of the 
6

statutory claim. Dorothy points out that an approved compromise and 

settlement is a final bar “without qualification or limitation” to all further 

rights under the workers’ compensation statutes. Bankers Standard Ins. 

v. Stanley, 661 N.W.2d 178, 181–82 (Iowa 2003). In contrast, the Terrys’ 

assert that a gross negligence claim against a coemployee is a common law 

claim that is outside the scope of the workers’ compensation statutes and, 

as a result, a settlement of Brian Terry’s statutory workers’ compensation 

claims does not extinguish the gross negligence and consortium claims.

On this point, we agree with the Terrys. Prior to 1973, the statutory 

immunity from claims under our workers’ compensation statute after 

settlement applied only to employers and not to coemployees. Craven v. 

Oggero, 213 N.W.2d 678, 680–81 (Iowa 1973) (en banc). Thus, as of 1973, 

an employee could bring a common law claim against coemployees based 

on tort theories. In 1974, the statute was amended to extinguish common 

law claims against coemployees except for those founded in gross 

negligence. See 1974 Iowa Acts ch. 1111, § 1 (codified at Iowa Code 

§ 85.20 (1975)); Gourley v. Nielson, 318 N.W.2d 160, 160–61 (Iowa 1982). 

Thus, the common law claims against coemployees for gross negligence 

survived the amendment and are not within the scope of our workers’ 

compensation statutes. 

B. Summary Judgment Based on Contract Theory. We now turn 

to the separate and independent question of whether, as a matter of 

contract law, the settlement documents in this case extinguished Brian’s 

gross negligence claim and Lisa’s consortium claim. As a preliminary 

matter, we must address whether the contract theory is properly before 

the court.
7

We first examine the ruling of the district court. The district court 

expressly ruled in favor of Dorothy on both statutory and contract 

grounds. The district court, among other things, declared that,

the plain language of contract (here, the Compromise 

Settlement including the Additional terms of Settlement), 

Mr. Terry released all employees of LSI—including 

Ms. Dorothy—from any and all claims of injuries that he may 

have against them. Therefore, Ms. Dorothy is entitled to 

summary judgment on Mr. Terry’s claim of gross negligence. 

Plainly, the contract was preserved in the district court. 

We now turn to the question of whether the contract theory was 

waived by Dorothy on appeal. The header of the argument section in 

Dorothy’s brief broadly declares without limitation that the district court 

correctly granted summary judgment in favor of the defendant. The 

discussion that follows admittedly concentrates most of its firepower on 

the statutory theory that we have rejected. 

Yet, the contract theory was also clearly presented in Dorothy’s 

appellate brief. Dorothy stated that “plaintiff Brian Terry’s compromise 

settlement agreement with LSI is a contract and the principles of contract 

law apply.” After citing various cases explaining basic principles of 

contract law, Dorothy argued “[w]ith the above principles in mind, it is 

clear that plaintiff Terry released any claim he might have against the 

defendant Dorothy involving his work place injury.” Dorothy further 

claims that because she “is one of the employees covered by the language 

in the settlement documents, her motion for summary judgment [was] 

properly granted.” Certainly, this is enough to raise the contract theory 

on appeal. “Our issue preservation rules are not designed to be 

hypertechnical.” Griffin Pipe Prods. Co. v. Bd. of Rev., 789 N.W.2d 769, 

772 (Iowa 2010). 
8

We now turn to the merits of the contract theory. “A release is a 

contract, and its validity is governed by the usual rules relating to 

contract.” Stetzel v. Dickenson, 174 N.W.2d 438, 439 (Iowa 1970). The 

intent of the parties controls, and unless the contract is ambiguous, intent 

is determined by the plain language of the contract. Verne R. Houghton 

Ins. Agency v. Orr Drywall Co., 470 N.W.2d 39, 42 (Iowa 1991). It is, of 

course, true that the compromise settlement is limited to release of

workers’ compensation claims. Considered in isolation, this document 

would not provide a basis for summary judgment. But, in addition, the 

parties executed the additional terms of settlement. Here, much broader 

release language is employed. The additional terms of settlement releases 

all employees of LSI from any and all liability. The language is broad, 

unqualified, and not ambiguous. It certainly extinguishes common law 

claims. And, although Lisa was not a signatory to the additional terms of 

settlement, her claim depends on the validity of the underlying claim of 

her spouse.1 

As a result, although the district court’s ruling was flawed when it 

reasoned that a statutory workers’ compensation claim extinguishes 

common law gross negligence claims against a coemployee, the district 

court properly ruled that, as a matter of contract, the language in the 

additional terms of settlement extinguished Brian’s gross negligence claim 

and Lisa’s consortium claim. 

IV. Conclusion. 

For all the above reasons, we affirm the order of the district court 

granting summary judgment against the plaintiffs in this matter.

DECISION OF COURT OF APPEALS VACATED; DISTRICT COURT 

GRANT OF SUMMARY JUDGMENT AFFIRMED.

 1The appellants did not raise the issue of whether Lisa’s signature was required 

to release her loss of consortium claim. We therefore do not consider the issue.