IN THE SUPREME COURT OF IOWA

No. 18–1329

Filed May 29, 2020

TERRI ENDRESS,

Appellee,

vs.

IOWA DEPARTMENT OF HUMAN SERVICES,

Appellant.

On review from the Iowa Court of Appeals.

Appeal from the Iowa District Court for Polk County, Karen A. 

Romano, Judge.

DHS seeks further review of a court of appeals decision. DECISION 

OF COURT OF APPEALS VACATED; DISTRICT COURT JUDGMENT 

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED WITH 

DIRECTIONS. 

Thomas J. Miller, Attorney General, Jeffrey S. Thompson, Solicitor 

General, and Tabitha J. Gardner, Assistant Attorney General, for 

appellant.

Trent W. Nelson of Sellers, Galenbeck & Nelson, Des Moines, for 

appellee.
2

CHRISTENSEN, Chief Justice.

In this case, the Iowa Department of Human Services (DHS) waited 

two years to attempt recoupment of $16,003.94 for child-care services 

rendered by the provider during agency review of her cancelled provider 

agreement. We must decide whether the provider was given 

constitutionally sufficient notice of DHS’s intent to recoup payments. DHS 

sent a notice cancelling the agreement. The notice advised the provider of 

a right to appeal but cautioned, “Any benefits you get while your appeal is 

being decided may have to be paid back if the Department’s action is 

correct.” On appeal, DHS affirmed its decision to cancel the provider’s 

agreement. Years later, DHS also found that the provider had to pay back 

the $16,003.94. On judicial review, the district court reversed DHS’s 

decision on recoupment. It reasoned DHS’s notice to the provider did not 

afford her procedural due process. The district court, however, denied 

attorney fees to the provider under Iowa Code section 625.29(1)(b) (2017). 

On appeal, the court of appeals affirmed the decision of the district court 

on the merits while reversing with respect to the award of attorney fees. 

We granted further review. Upon our review, we conclude DHS’s 

notice meets procedural due process requirements. However, we also 

conclude that DHS erred in refusing to consider the provider’s unjustenrichment defense to the recoupment proceeding. On remand to the 

agency, the provider should be allowed an opportunity to raise unjust 

enrichment as an offset to DHS’s effort to recoup overpayments. With 

respect to attorney fees, DHS’s role was primarily adjudicative, and it is 

not liable for attorney fees. Therefore, we vacate the decision of the court 

of appeals and affirm in part and reverse in part the judgment of the 

district court. We remand the case to the district court to remand to DHS 

for consideration of the provider’s equitable relief.
3

Three justices of this court have joined this entire opinion. The 

concurrence in part and dissent in part filed by Justice McDonald on 

behalf of three justices joins divisions III.A and III.C of this opinion, while 

dissenting as to division III.B. The concurrence in part and dissent in part 

filed by Justice Appel contingently joins division III.B of this opinion, while 

dissenting as to divisions III.A and III.C. Accordingly, this opinion controls 

all aspects of the resolution of this appeal. 

I. Background Facts and Proceedings. 

In 2012, Terri Endress received DHS registration as an approved 

Category B DHS child-care provider. Endress entered into a Child Care 

Assistance Provider (CCAP) agreement with DHS on March 6, 2013. This 

agreement allowed Endress to receive state funds to provide child care for 

eligible children, not to exceed twelve children at any one time. The 

agreement had a two-year term and provided that if it was terminated, 

termination “may prevent” Endress from reapplying to be a provider for six 

months. 

DHS received at least three reports against Endress, indicating more 

children were present in her day care than allowed under her registration.1

The DHS investigator never found more than twelve children present 

during his spot checks. Nor did DHS find any other health or safety 

violations associated with the day care. However, on reviewing the billings, 

DHS found Endress had submitted billings that would have indicated 

thirteen to fifteen children were present at the same time. 

On July 17, 2014, Endress received notice from DHS cancelling her 

CCAP agreement because she had repeatedly submitted claims for 

payment to which she was not entitled (based on the number of children 

 1Two of the reports predated the March 6, 2013 agreement. 
4

shown under her care at specific times). The notice of cancellation 

explained Endress may keep her benefits until an appeal is final. However, 

the notice cautioned, “Any benefits you get while your appeal is being 

decided may have to be paid back if the Department’s action is correct.”

Endress elected to receive funding while she appealed the decision 

cancelling her CCAP agreement. As a result, Endress received a July 31, 

2014 notice:

You have timely appealed the cancellation or denial of your 

CCA provider agreement. You are therefore allowed to 

continue to receive child care assistance funding pending the 

outcome of your appeal. Any benefits you get while your 

appeal is being decided may have to be paid back if the 

Department’s action is correct. 

(Emphasis added.) DHS issued a final decision on November 17, 2014, 

sustaining the proposed decision to cancel Endress’s CCAP agreement 

because she repeatedly made billings for children in excess of the numbers 

allowed for her care at any one time. 

On March 17, 2017, Endress was approved by DHS for another 

CCAP agreement. On April 3, Endress received a “Notice of Child Care 

Assistance Overpayment” in the amount of $16,003.942 for the months of 

July 2014 to November 2014. DHS alleged the overpayment was due to 

“[a] mistake by [Endress] that caused DHS to pay [her] incorrectly for child 

care services” and that the “overpayment happened because of [her] choice 

to continue benefits pending an appeal.” Endress appealed, and an 

administrative law judge (ALJ) affirmed DHS’s computation of 

overpayment for child-care assistance. 

This proposed decision was adopted as DHS’s final decision, and 

Endress petitioned for judicial review. She argued DHS violated her due 

 2The original notice stated the amount owed as $16,001.94. That was later 

corrected to the present amount, $16,003.94. 
5

process rights through insufficient notice of its intent to recoup payments 

during her pending appeal. She also argued that she had not been 

overpaid; she had provided appropriate child care at DHS rates for the 

children entrusted to her. Endress pointed out that if there was any 

overpayment, based on the DHS audit, it amounted only to $623.28 at 

most and not the full amount (over $16,000) she was paid over four 

months for child-care services rendered. The district court granted 

Endress’s petition and reversed the decision of DHS. On judicial review, 

it determined DHS exceeded its statutory authority in promulgating the 

recoupment provisions of its administrative rules, the administrative rules 

were unconstitutionally vague, and DHS’s implementation of the 

administrative rules violated Endress’s procedural due process rights. 

Endress also sought attorney fees, which the district court denied. 

DHS appealed, and Endress cross-appealed the denial of attorney 

fees. On appeal, the court of appeals agreed that Endress maintained a 

protected property interest in payments made under the CCAP agreement 

and that the notice of recoupment was constitutionally deficient. However, 

it reversed the district court’s determination that Endress was not entitled 

to attorney fees. 

DHS applied for further review, and we granted its application. 

II. Standard of Review. 

Different standards of review apply to the claims raised by Endress. 

First, the Iowa Administrative Procedure Act defines the standards we 

apply in our judicial review of agency action to determine whether we reach 

the same conclusion as the district court. See Iowa Code § 17A.19(10); 

Brewer-Strong v. HNI Corp., 913 N.W.2d 235, 242 (Iowa 2018). “The 

district court may properly grant relief if the agency action prejudiced the 

substantial rights of the petitioner and if the agency action falls within one 
6

of the criteria listed in section 17A.19(10)(a) through (n).” Brakke v. Iowa 

Dep’t of Nat. Res., 897 N.W.2d 522, 530 (Iowa 2017). 

Second, Endress’s constitutional claims in agency proceedings are 

reviewed de novo. Ghost Player, L.L.C. v. State, 860 N.W.2d 323, 326 (Iowa 

2015). 

Finally, with respect to whether attorney fees are available, we apply 

the standard of correction of errors at law. Colwell v. Iowa Dep’t of Human 

Servs., 923 N.W.2d 225, 232 (Iowa 2019). 

III. Analysis.

A. Procedural Due Process. Endress alleges a violation of her 

procedural due process rights under the Fourteenth Amendment to the 

United States Constitution and article I, section 9 of the Iowa Constitution. 

We will apply the federal substantive standards because Endress does not 

suggest we follow different substantive standards under the Iowa 

Constitution. See Behm v. City of Cedar Rapids, 922 N.W.2d 524, 566 

(Iowa 2019) (applying federal substantive standards to a party’s procedural 

due process claim raised under the Iowa Constitution); State v. Russell, 

897 N.W.2d 717, 732 & n.7 (Iowa 2017) (“Russell also did not present an 

argument for why we should depart from established precedent in our 

interpretation of the Iowa Constitution’s due process clause. We therefore 

treat both [federal and state] claims as the same.”).

Endress is entitled to procedural due process if a state action 

threatens to deprive her of a protected interest in life, liberty, or property. 

Behm, 922 N.W.2d at 566; Russell, 897 N.W.2d at 732–33; Bowers v. Polk 

Cty. Bd. of Supervisors, 638 N.W.2d 682, 690 (Iowa 2002). Accordingly, as 

a first step, Endress must show a protected interest is involved. See Behm, 

922 N.W.2d at 566; State v. Willard, 756 N.W.2d 207, 214 (Iowa 2008). 
7

We have explained, “Protected property interests ‘ “are created and 

their dimensions are defined” not by the Constitution but by an 

independent source such as state law.’ ” Willard, 756 N.W.2d at 214 

(quoting State v. Seering, 701 N.W.2d 655, 665 (Iowa 2005), superseded 

by statute on other grounds, 2009 Iowa Acts ch. 119, § 3 (codified at Iowa 

Code § 692A.103 (Supp. 2009)), as recognized in AFSCME Iowa Council 61 

v. State, 928 N.W.2d 21, 31 (Iowa 2019)). This includes “rules or 

understandings that secure certain benefits and that support claims of 

entitlement to those benefits.” Bd. of Regents of State Colls. v. Roth, 408 

U.S. 564, 577, 92 S. Ct. 2701, 2709 (1972); Orloff v. Cleland, 708 F.2d 

372, 377 (9th Cir. 1983) (“Entitlements are created by ‘rules or 

understandings’ from independent sources, such as statutes, regulations, 

and ordinances, or express or implied contracts.” (quoting Roth, 408 U.S. 

at 577, 92 S. Ct. at 2709)). 

The district court concluded the relevant statute at issue—in 

conjunction with its administrative rules—created DHS’s statutory 

obligation to pay for the child-care services Endress provided during her 

appeal. The statute relied on provides, 

The department’s billing and payment provisions for the 

program shall allow providers to elect either biweekly or 

monthly billing and payment for child care provided under the 

program. The department shall remit payment to a provider 

within ten business days of receiving a bill or claim for services 

provided. However, if the department determines that a bill 

has an error or omission, the department shall notify the 

provider of the error or omission and identify any correction 

needed before issuance of payment to the provider. The 

department shall provide the notice within five business days 

of receiving the billing from the provider and shall remit 

payment to the provider within ten business days of receiving 

the corrected billing. 

Iowa Code § 237A.13(4) (2017) (emphasis added). It reasoned the 

legislature’s use of “shall” mandated a duty, see Iowa Code § 4.1(30)(a), 
8

which was fulfilled by DHS’s accompanying rule, see Iowa Admin. Code 

r. 441—7.9(1) (2017). 

We assume, without deciding, that Endress did have a protected 

property interest in payments under her CCAP agreement. Therefore, our 

next step is to determine whether Endress was afforded procedural due 

process. Procedural due process requires, at the very least, “notice and 

opportunity to be heard in a proceeding that is ‘adequate to safeguard the 

right for which the constitutional protection is invoked.’ ” Willard, 756 

N.W.2d at 214 (quoting Seering, 701 N.W.2d at 665–66). Endress does not 

challenge the district court’s finding that she was given an opportunity to 

be heard. The contention lies with the notice DHS provided. Endress 

asserts DHS’s notice is not a sufficient warning of the action taken against 

her. We have said, “Notice must be reasonably calculated to apprise 

interested parties of the pendency of the action and afford them an 

opportunity to present their objections.” Meyer v. Jones, 696 N.W.2d 611, 

614 (Iowa 2005) (quoting In re Estate of Borrego, 490 N.W.2d 833, 837 

(Iowa 1992)). We conclude the notice DHS provided Endress meets this 

requirement. 

The first notice Endress received was DHS’s “Notice of Decision: 

Child Care.” This notice explained DHS was cancelling Endress’s CCAP 

agreement and specifically stated, “This action means you are no longer 

eligible to receive CCA payments, it does not change your status as a child 

development home or licensed center.” The notice also provided Endress 

with a right-to-appeal document. As stated in the appeal document, 

Endress could elect to keep her benefits until an appeal is final. However, 

it cautioned, “Any benefits you get while your appeal is being decided may 

have to be paid back if the Department’s action is correct.” Endress claims 

the use of “benefits” connotes a broader gratuity or assistance not 
9

applicable to her; she also argues that the cautionary language about 

repayment of “benefits” does not mean that she may be required to pay 

back her earned funds. 

Iowa Code chapter 237A does not define “benefits.” Likewise, the 

relevant administrative rules as well as the provider agreement are silent 

on this definition. “In the absence of a legislative definition of a term or a 

particular meaning in the law, we give words their ordinary meaning.” 

State v. Kidd, 562 N.W.2d 764, 765 (Iowa 1997). The dictionary is a source 

for the common and ordinary meaning of a word. Id. “Benefits” is defined 

as “to be useful or profitable to : AID, ADVANCE, IMPROVE.” Benefits,

Webster’s Third New International Dictionary (unabr. ed. 2002). We 

determine the plain and ordinary definition of “benefits” includes funds 

provided to Endress by DHS for child-care services. 

Our understanding of what “benefits” means is further supported by 

the context of the second notice Endress received. Endress appealed 

DHS’s decision to cancel her CCAP agreement. As part of the appeals 

process, Endress selected “Yes” to whether she wanted her “Benefits [to] 

Continue.” Her decision prompted DHS to send a second notice indicating 

she appealed the cancellation of her agreement. Important to our decision 

here, the second notice advised Endress that she was “allowed to continue 

to receive child care assistance funding pending the outcome of [her] 

appeal.” (Emphasis added.) The second notice again cautioned, “Any 

benefits you get while your appeal is being decided may have to be paid 

back if the Department’s action is correct.” It is clear the plain and 

ordinary meaning of “benefits” includes any funds Endress received while 

her appeal was pending. The notice from DHS need only “be reasonably 

calculated to apprise interested parties of the pendency of the action.” 

Meyer, 696 N.W.2d at 614 (quoting In re Estate of Borrego, 490 N.W.2d at 
10

837). DHS’s notice meets this requirement and Endress was thus afforded 

procedural due process.

B. Equitable Relief. We do not agree that this ends the matter, 

though. While Endress’s appeal was pending, DHS was getting the benefit 

of child-care services from her. As a DHS-approved Category B child-care 

provider, Endress provided eligible families with child-care services. See

Iowa Code § 237A.13(1)(a)–(f); Iowa Admin. Code r. 441—170.4(3)(b). More 

importantly, DHS-approved providers could also provide child-care 

services for a child with protective needs in order to prevent or alleviate 

abuse or neglect, see Iowa Code § 237A.13(1)(e), and child-care services 

provided under a court order, see Iowa Admin. Code r. 441—170.3(2)(d). 

Because of the exigent circumstances surrounding child abuse or neglect, 

the benefits of protective child care and court-ordered child care are 

provided irrespective of whether that child’s family is eligible for state 

child-care assistance. See Iowa Admin. Code r. 441—170.3(2)(c), (d). 

When the state exercises its removal power to prevent or alleviate harm to 

a child, see Iowa Code §§ 232.78, .79, .79A, .102(1)(a)(3), the DHSapproved child-care providers benefit the state by keeping the removed 

child safe. 

It is the state’s obligation, as parens patriae, to ensure every child 

receives proper care and treatment. Hensler v. City of Davenport, 790 

N.W.2d 569, 583 (Iowa 2010) (“The state has a legitimate interest to 

promote the public welfare or the well-being of the child.”); In re K.N., 625 

N.W.2d 731, 735 (Iowa 2001) (en banc) (“We have also observed that it is 

the State’s duty, as parens patriae, to ensure that the aims of the juvenile 

justice code are applied to each child in need of the code’s assistance.”); In 

re Guardianship of Hedin, 528 N.W.2d 567, 571 (Iowa 1995) (en banc) 

(stating it is the state’s obligation under the doctrine of parens patriae to 
11

care for vulnerable and less fortunate persons); In re M.M., 483 N.W.2d 

812, 814 (Iowa 1992) (“The State, as parens patriae, has the duty to make 

sure that every child within its borders receives appropriate care and 

treatment. Our juvenile statutes are designed to effectuate that duty.”

(Citation omitted.)). The state may use a wide range of powers to ensure a 

child’s safety, see Hensler, 790 N.W.2d at 583, which include financial 

demands on the public fisc, see Iowa Code § 237A.12 (“Subject to the 

provisions of chapter 17A, the department shall adopt rules setting 

minimum standards to provide quality child care in the operation and 

maintenance of child care centers and registered child development 

homes . . . .”); id. § 237A.29(1) (allowing state and federal funds to pay for 

child-care services); Galloway v. State, 790 N.W.2d 252, 257, 258 (Iowa 

2010) (“If parents fail to provide for the needs of their injured children, and 

the preinjury waiver in favor of the tortfeasor is enforced, financial 

demands may be made on the public fisc to cover the cost of care.”); Clare 

Huntington, Welfare Reform and Child Care: A Proposal for State 

Legislation, 6 Cornell J.L. & Pub. Pol’y 95, 115 (1996) (“Importantly, 

because child care subsidies funds were drawn directly from the public 

fisc, the CCBDG [Child Care and Development Block Grant] succeeded in 

shifting the cost of child care away from the working poor and onto society 

at-large.”). 

Endress contends it would be unreasonable, arbitrary, capricious, 

or an abuse of discretion for DHS to receive free child-care services from 

her during the four months in 2014 that her appeal was pending. The 

rules allow for recovery of “overpayments . . . due to benefits or payments 

issued pending an appeal decision . . . . Overpayments shall be computed 

as if the information had been acted upon timely.” Iowa Admin. Code 

r. 441—170.9(2). Endress argues that if this rule is interpreted as allowing 
12

DHS to take back everything it paid her from July to November 2014 

regardless of the benefit received, DHS would be unjustly enriched.

Endress asserted this unjust enrichment argument before the 

agency. The ALJ rejected this argument on the ground that the doctrine 

is a basis for recovering funds in a civil action, not a defense in an 

administrative action. The DHS director adopted the ALJ’s decision and 

did not separately address this issue at all.

We think this was error. Under the law of contracts, even when a 

party is in breach, the party “has a claim in restitution against the 

recipient of performance, as necessary to prevent unjust enrichment.” 

Restatement (Third) of Restitution & Unjust Enrichment § 36(1), at 585–

86 (Am. Law Inst. 2011). It is true that such claims may be limited or 

denied because of the breaching party’s inequitable conduct, see id. § 63,

at 487, but DHS never engaged in this analysis. Unjust enrichment could

have been considered as a defense or offset.

Also, the notice itself did not specify that any payments received 

during the appeal period “shall” be returned to DHS if Endress lost her 

appeal. It said that the benefits “may” have to be paid back. Inherent in 

the word “may” is that the agency has discretion. See State ex rel. Lankford 

v. Allbee, 544 N.W.2d 639, 641 (Iowa 1996). And that discretion is subject 

to reversal if it is unreasonable, arbitrary, capricious, or an abuse of 

discretion. See Iowa Code § 17A.19(10)(n). DHS’s rule states that 

“overpayments” shall be recouped from child-care providers. See Iowa 

Admin. Code r. 441—170.9(2). The word “overpayment” is pervasive. But 

this begs the question of whether a child-care provider has been “overpaid” 

during an appeal period when DHS receives child-care services and has 

no complaint about their quality or the provider’s registration. Endress’s 

very point—which DHS declined to consider—was she had only been 
13

“overpaid” at most $623.28. Further, Endress testified that she had paid 

her own employees out of the $16,000. Additionally, she testified that 

between November 2014 and March 2017 she simply switched roles with 

one of her employees who held the DHS contract; presumably, that same 

arrangement could have been made during the appeal period.

Unjust enrichment is rooted in the principle that one party should 

not be unjustly enriched at the expense of another party. State ex rel. 

Palmer v. Unisys Corp., 637 N.W.2d 142, 154 (Iowa 2001). We have 

previously recognized that “unjust enrichment is a broad principle with 

few limitations.” Id. at 155. The remedies under this doctrine may be 

legal, equitable, or both. Restatement (Third) of Restitution & Unjust 

Enrichment § 4, at 27; id. § 4 cmt. b, at 28 (“The law of restitution is not 

easily characterized as legal or equitable, because it acquired its modern 

contours as the result of an explicit amalgamation of rights and remedies 

drawn from both systems.”). Unjust enrichment has three basic elements:

“(1) enrichment of the defendant, (2) at 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. In the past, we have considered 

a plaintiff’s unjust-enrichment claim against DHS and the State of Iowa. 

See Ahrendsen ex rel. Ahrendsen v. Iowa Dep’t of Human Servs., 613 

N.W.2d 674, 679 (Iowa 2000) (en banc) (holding “neither DHS nor the State

of Iowa was unjustly enriched by denying an application for Medicaid 

benefits on a ground that was consistent with federal statutory law and 

the DHS regulations”); see also Krieger v. Iowa Dep’t of Human Servs., 439 

N.W.2d 200, 203 (Iowa 1989) (“The DHS was not ‘enriched’ by the services 
14

rendered for the Waterloo Pollution Control Plant.”); Dolezal v. City of 

Cedar Rapids, 326 N.W.2d 355, 358 (Iowa 1982).3 

We do not think the law draws a distinction based on the procedural 

status of the matter. Thus, the mere fact that DHS had paid for the July 

2014 to November 2014 services and thus was initiating the claim, rather 

than defending Endress’s claim, should not make a difference. Either way, 

 3The cases of Kreiger, 439 N.W.2d 200, Marshall v. State, 559 N.W.2d 612 (Iowa 

1997), and Ahrendsen, 613 N.W.2d 674, are all distinguishable on their facts.

In Krieger, an individual who received welfare benefits while failing to disclose an 

asset that rendered him ineligible became the subject of a DHS recoupment action. 439 

N.W.2d at 201. He did not dispute that recoupment was appropriate but argued that he 

should receive credit for services he had provided without compensation under a 

community work experience program as a condition of receiving his benefits. Id. We held 

unjust enrichment was not an appropriate offset under the facts of that case, reasoning, 

“[W]e . . . reject Krieger’s unjust enrichment argument. The DHS was not ‘enriched’ by 

the services rendered for the Waterloo Pollution Control Plant. Krieger worked for the 

Waterloo plant, not for the DHS, and the DHS received no benefits from his services.” Id.

at 203. Of course, welfare benefits are different from contracted child-care services. See 

id. at 201. The work requirement was intended to make Krieger more employable and to 

provide a benefit to the Waterloo plant—not to provide a benefit to DHS. See id at 202–

03. 

In Marshall, an individual who received welfare benefits when she was not eligible 

due to having provided false information was required to pay all those benefits back. 559 

N.W.2d at 615. We upheld the agency’s determination that lack of fraudulent intent was 

not a defense to repayment. Id. But, again, welfare benefits are different from contracted 

child-care services. The applicable state administrative rule was different. See id. at 614. 

And federal law left no discretion as to whether those benefits had to be recovered. Id. 

In Ahrendsen, an estate sought more than three months of retroactive Medicaid 

benefits, even though federal law and state regulations limited retroactivity to only three 

months. 613 N.W.2d at 677. The estate pointed out that the Medicaid application had 

been delayed because DHS had provided incorrect information. Id. at 676. We upheld 

DHS’s denial of more than three months of benefits and also denied recovery under unjust 

enrichment. Id. at 678–79. We explained, “We are convinced that neither DHS nor the 

State of Iowa was unjustly enriched by denying an application for Medicaid benefits on a 

ground that was consistent with federal statutory law and the DHS regulations.” Id. at 

679. But there the federal law and regulations gave no room for discretion. Id. at 677. 

Furthermore, as in Marshall, these were benefits rather than payments for services 

rendered. See id. at 675. So it would be unrealistic to say DHS had been “unjustly 

enriched” when it received nothing in return. See id. at 679. 

A key point is that none of these cases said that unjust enrichment could not 

apply to DHS recoupment proceedings. In fact, Krieger and Ahrendsen implicitly 

recognized it could apply under the appropriate facts. 
15

it seems inequitable for DHS to get needed child-care services for nothing. 

This is not to say that Endress is entitled to keep all of the $16,003.94. 

She has the burden of showing the benefit she conferred on DHS during 

the four months in question that should be offset against DHS’s requested 

recoupment. For example, she must demonstrate that during the four 

months, the day care was operating lawfully and did not have an excessive 

number of children. To the extent DHS has suffered loss attributable to 

Endress’s violations of the CCAP agreement, that should be taken into 

account as well. See Restatement (Third) of Restitution & Unjust 

Enrichment § 36, at 585–86; id. § 63, at 487. In short, the issue remaining 

is whether DHS’s enrichment at Endress’s expense was “under 

circumstances that make it unjust for [DHS] to retain the benefit.” Behm, 

922 N.W.2d at 577. Therefore, we remand to the district court to remand 

to the agency so that it may fully consider Endress’s unjust-enrichment 

claim as an offset against DHS’s claim for recoupment. 

C. Attorney Fees. Iowa law authorizes a court to award attorney 

fees to a party that prevails in a judicial review action brought against the 

state pursuant to chapter 17A. Iowa Code § 625.29(1). However, there is 

an exception. 

[T]he court shall not make an award under this section if it 

finds one of the following: 

. . . .

b. The state’s role in the case was primarily 

adjudicative. 

Id. § 625.29(1)(b). The district court considered the exceptions under 

section 625.29(1) and concluded DHS’s role in the case was primarily 

adjudicative. Accordingly, it declined to award Endress attorney fees. 
16

Endress now claims the agency did not adjudicate the rights and duties of 

the parties but rather preserved the issues for judicial review. 

Within the context of section 625.29(1), our court addressed the 

meaning of “primarily adjudicative.” We have explained, “[I]t can be said 

that if an agency’s function principally or fundamentally concerns settling 

and deciding issues raised, its role is primarily adjudicative.” Remer v. Bd. 

of Med. Exam’rs, 576 N.W.2d 598, 601 (Iowa 1998) (en banc). The role of 

the agency is viewed “ ‘in the case’ at bar,” not the agency’s role generally. 

Id. Therefore, we must determine whether the agency’s role in Endress’s 

case principally or fundamentally concerned settling and deciding issues 

raised. 

We addressed whether the role of an agency was primarily 

adjudicative in Branstad v. State ex rel. Natural Resource Commission, 871 

N.W.2d 291 (Iowa 2015). Branstad concerned the Iowa Department of 

Natural Resources (DNR) investigation and subsequent restitution 

assessment following a fish kill. Id. at 292–93. A contested hearing was 

held before an impartial ALJ to address the assessment of restitution, 

including the amount. Id. at 293, 297. After the ALJ issued a proposed 

decision affirming the DNR’s assessment, Branstad appealed to the Iowa 

Natural Resource Commission. Id. at 298. The commission affirmed the 

proposed decision, which became the final decision. Id. Branstad 

petitioned for judicial review, and this court was asked to determine 

whether the state’s role was primarily adjudicative. Id. at 294–95.

The Branstad court cited our previous understanding of “primarily 

adjudicative” as expressed in Remer. See id. at 295–96. It also noted the 

role of the commission was to “[hear] appeals in contested cases pursuant 

to chapter 17A.” Id. at 296 (quoting Iowa Code § 455A.5(6)(b)). Ultimately, 

the commission “weighed the evidence about the fish kill, applied the 
17

rules, considered Branstad’s various defenses, and determined that the 

amount in the restitution assessment was proper.” Id. Its actions fell 

squarely within the meaning of adjudicate. Id. at 297. 

The procedure in Branstad aligns with Endress’s case. Following 

reports that Endress had more than twelve children present at certain 

times, DHS conducted an investigation. It found Endress submitted 

claims for payment to which she was not entitled. This led DHS to 

terminate Endress’s CCAP agreement and later to recoup overpayments. 

Endress appealed DHS’s decision to recoup overpayments in a contested 

case before an impartial ALJ. The notice of hearing before the ALJ framed 

the issue as “[w]hether the Department correctly computed and 

established a claim for overpaid child care assistance.” In support of her 

nonadjudicative position, Endress points out DHS’s own rules indicate the 

recovery of overpayments “is not an appealable issue.” Iowa Admin. Code 

r. 441—7.9(7). However, the proposed decision rejected this position and 

specifically addressed whether DHS correctly computed and established 

overpayment. The authority to address whether DHS correctly computed 

overpayment is in fact provided by DHS’s rules: “[A]ppeals may be heard 

on the computation of excess assistance paid pending a final decision.” Id. 

Although the impartial ALJ made the initial proposed decision, DHS made 

the final decision after it weighed evidence about recoupments, applied 

rules, and determined the rights of the parties. See Branstad, 871 N.W.2d 

at 297. 

We are not persuaded the state’s role was to primarily preserve 

arguments. DHS’s final decision adopted the proposed decision, which 

affirmed “[DHS’s] decision establishing and computing a claim for

overpayment against [Endress] in the amount of $16,003.94.” It is true 

DHS’s final decision preserved Endress’s constitutional arguments for 
18

judicial review. This is because DHS lacked authority to decide her 

constitutional issues. See Soo Line R.R. v. Iowa Dep’t of Transp., 521 

N.W.2d 685, 688 (Iowa 1994). Moreover, Endress is required to raise 

constitutional issues at the agency level, even though the agency lacks the 

authority to decide the issues, in order to preserve the constitutional 

issues for judicial review. See McCraken v. Iowa Dep’t of Human Servs., 

595 N.W.2d 779, 785 (Iowa 1999). Contrary to Endress’s position, 

preserving an issue for judicial review because the agency lacks authority 

to decide the issue does not automatically brand the agency action as 

nonadjudicative. If DHS determines it lacks jurisdiction to hear a dispute 

it could otherwise adjudicate, a prevailing party cannot ask for section 

625.29(1) attorney fees against DHS as the adjudicator. See Colwell, 923 

N.W.2d at 238. DHS has the authority to determine for itself if it has 

subject matter jurisdiction over a matter. Id. As we explained in Colwell, 

Every court has inherent power to determine whether it has 

jurisdiction over the subject matter of the proceedings before 

it. It makes no difference how the question comes to its 

attention. Once raised, the question must be disposed of, no 

matter in what manner of form or stage presented. The court 

on its own motion will examine grounds of its jurisdiction 

before proceeding further.

Id. (quoting Carmichael v. Iowa State Highway Comm’n, 156 N.W.2d 332, 

340 (Iowa 1968)). 

In this case, DHS preserved the constitutional issues it lacked 

authority over, addressed whether it correctly computed and established 

overpayments, and settled the issues raised. Endress is concerned the 

use of the agency appeal system to preserve issues for judicial review gives 

the false impression that adjudication occurred, thereby preventing 

potential attorney fees under section 625.29(1)’s exceptions. We 

previously addressed this concern in Branstad: 
19

[A] commentator who has reviewed the legislative history 

notes that, while there is no explanation provided in the 

legislation, previous proposed bills would have eased the 

ability to award attorney fees against the State. These bills 

were rejected in favor of more limiting language contained in 

the final legislation. Key among legislative concerns with prior 

forms of the bill was the cost to the State if attorney fees were 

awarded often. 

Branstad, 871 N.W.2d at 297 (citations omitted). If the legislature 

intended to ease the ability to award attorney fees, it would have done so. 

The principal function of DHS in the case at bar was primarily 

adjudicative. Therefore, DHS is not liable for Endress’s attorney fees 

under Iowa Code section 625.29(1)(b). 

IV. Conclusion. 

For the aforementioned reasons, the decision of the court of appeals 

is vacated. We affirm the judgment of the district court in part, reverse in 

part, and remand to the district court with directions to remand the matter 

to the agency to consider unjust enrichment as an offset (at least in part) 

to DHS’s claim for recoupment. 

DECISION OF COURT OF APPEALS VACATED; DISTRICT COURT 

JUDGMENT AFFIRMED IN PART, REVERSED IN PART, AND 

REMANDED WITH DIRECTIONS.

Waterman and Mansfield, JJ., join this opinion. Appel, J., files a 

concurrence in part and dissent in part. McDonald, J., files a separate 

concurrence in part and dissent in part joined by Oxley and McDermott, 

JJ. 
20

#18–1329, Endress v. Iowa Dep’t of Human Servs.

APPEL, Justice (concurring in part and dissenting in part).

In my view, this case presents a classic due process problem arising 

from an extreme case of administrative overreach that cries out for a 

judicial remedy. Further, because the Iowa Department of Human 

Services (DHS) did not adjudicate the most important issues in the 

administrative process, I conclude that Terri Endress is entitled to attorney 

fees under Iowa Code section 625.29 (2017). 

I. Factual and Procedural Background.

A. Introduction. Endress had a Child Care Assistance Provider 

(CCAP) agreement with the DHS to provide child care for low income 

persons. Under the agreement, she was to provide services to no more 

than twelve children. The agreement contained a repayment provision, 

which stated, “I understand that I may have to repay money received in 

error or as a result of fraudulent billing.” 

B. First and Second DHS Notices of Decision. 

1. First notice. DHS sent Endress a “Notice of Decision: Child Care” 

dated July 17, 2014. The notice declared that the CCAP agreement 

between Endress and DHS was cancelled because “Endress submitted 

claims for payment for which [she was] not entitled.” 

The notice provided that if Endress did not agree with the decision, 

she could discuss the decision with agency staff. Such informal 

discussions, however, did not diminish her right to a hearing. The notice 

further stated, “If your application has been denied or your assistance has 

been canceled, you have the right to reapply.”

The notice provided that Endress had a right to appeal the decision. 

The notice stated if she appealed within ten days of the decision, 
21

You may keep your benefits until your appeal is final or 

through the end of your certification period if you file an 

appeal . . . . 

. . . .

Any benefits you get while your appeal is being decided may 

have to be paid back if the Department’s action is correct. 

Endress filed an appeal within ten days of the notice.

2. Second notice. DHS sent Endress a second “Notice of Decision: 

Child Care.” The notice stated that Endress timely appealed the 

cancellation or denial of her CCAP agreement. The second notice further 

stated,

You are therefore allowed to continue to receive child 

care assistance funding pending the outcome of your appeal. 

Any benefits you get while your appeal is being decided may 

have to be paid back if the Department’s action is correct. 

The second notice repeated the statement of the original notice that 

Endress “may keep [her] benefits until an appeal is final or through the 

end of [her] certification period” if a timely appeal is filed. The second 

notice further stated, again, “Any benefits you get while your appeal is 

being decided may have to be paid back if the Department’s action is 

correct.”

3. Administrative decision on notices. An administrative law judge 

(ALJ) held a telephonic hearing on the matter. Endress appeared on her 

own behalf; a representative from DHS appeared and called three 

witnesses. DHS submitted documents into the record including the CCAP 

agreement, complaint reports, attendance records, and the findings of a 

program manager. The ALJ characterized the issue as “[w]hether the 

Department correctly cancelled [Endress’s] child care provider agreement 

for repeatedly submitting claims for payment to which Endress was not 

entitled.” The ALJ noted that Endress certified that she would comply with 
22

the minimum requirements for a child-care development home and that 

three reports were filed against her indicating that more children were 

present in her day care than were allowed under her registration. The ALJ 

noted, however, that the DHS investigator never directly observed that 

Endress had more children present in day care than allowed under her 

provider agreement. 

The ALJ determined that on several occasions, Endress submitted 

bills indicating the presence of more than twelve children, and as a result, 

the ALJ determined that Endress had submitted claims for payment for 

which she was not entitled. While Endress suggested there were billing 

mistakes by employees, the ALJ determined that Endress repeatedly billed 

for children in excess of the number allowed for her care at any one time. 

As a result, the ALJ ruled that DHS’s cancellation of her CCAP agreement 

should be sustained.

C. Notice of Child-Care Assistance Overpayment.

1. Introduction. For several years, there was no further action taken 

by either Endress or DHS. In 2017, however, Endress applied for a new 

CCAP agreement and was accepted as a provider on about March 17. 

2. Notice of child-care assistance overpayment. DHS sent Endress 

a “Notice of Child Care Assistance Overpayment” on April 3, 2017. The 

notice asserted that Endress owed DHS $16,001.94 for amounts paid 

between July 29, 2014, and November 23, 2014. The reason for the 

overpayment was said to be the result of “[a] mistake by a provider that 

caused DHS to pay the provider incorrectly for child care services.” The 

dates the amounts owed were paid demonstrate that DHS was not seeking 

to recover for alleged overbillings but instead to recoup funds paid for 

services provided by Endress during the period when her appeal was 

pending before DHS. While DHS characterized the payments made for 
23

services provided by Endress during the course of the appeals as a 

“mistake made by a provider,” the funds DHS sought to recover were for 

services actually performed. The notice further states, “This overpayment 

happened because of your choice to continue benefits pending an appeal.” 

3. Administrative decision on notice of child-care assistance 

overpayment. Endress appealed the decision referenced in the notice of 

child-care assistance overpayment. On August 8, 2017, a hearing was 

held before an ALJ. DHS relied on Iowa Administrative Code rule 441—

7.9(3) (2017), which states, “[E]xcess assistance paid pending a hearing 

decision shall be recovered to the date of the decision. This recovery is not 

an appealable issue. However, appeals may be heard on the computation 

of excess assistance paid pending a hearing decision.” DHS took the 

position that the only issue that could be heard was the amount of money 

paid to Endress during the 2014 appeal. 

The ALJ entered a proposed decision that agreed with DHS. With 

respect to Endress’s due process claims, the ALJ declared that such 

constitutional arguments cannot be addressed on an administrative level 

but were preserved for judicial review. The ALJ also declined to address 

constitutional and statutory challenges to Iowa Administrative Code rule 

441—170.9. In addition, the ALJ declined to consider contract law claims 

on the basis the claims rehashed the constitutional arguments she had 

already rejected. Finally, the ALJ declined to find unjust enrichment, 

noting that she was aware of no authority holding unjust enrichment could 

be used as a defense in an administrative action.

Endress appealed the proposed decision to the director, who 

affirmed the decision. Endress then filed a petition for judicial review in 

district court. 
24

4. District court decision on review of agency action. Endress filed a 

petition for judicial review. The district court reversed. The district court 

found that Endress had a statutory property right in payments under Iowa 

Code section 237A.13(4), which provided that “[t]he departments shall 

remit payment to a provider within ten business days of receiving a bill or 

claim for services provided.” Further, the district court cited Iowa 

Administrative Code rule 441—7.9, which provides, in part, “Assistance 

. . . shall not be suspended, reduced, restricted, or canceled, nor shall a 

license, registration, certification, approval, or accreditation be revoked or 

other proposed adverse action be taken pending a final decision on an 

appeal.” 

The district court also found a contractual interest in the payments. 

The district court based its decision on the CCAP agreement which noted, 

among other things, that the provider shall “have the status of an 

independent contractor.” The contract, however, provided that DHS could 

cancel the agreement with ten days’ notice for any violation of the 

agreement. The district court reasoned, however, that the notice of 

decision received by Endress terminated her rights under the contract (but 

not under the statute). 

Having found a statutory property interest and partial contractual 

interest in the payments, the district court proceeded to consider whether 

Endress received adequate notice that all the funds paid, including those 

earned for new services, could be recouped by the state. The district court 

focused primarily on the fact that the notice indicated “any benefits” you 

get during the appeal may have to be paid back, but the CCAP agreement 

talks not in terms of benefits but refers to “fees” and “payments” and 

“money received.” According to the district court, the parent of a child 
25

receives the benefits, not a provider. The poor terminology in the notice, 

according to the district court, was “fatal.” 

The district court proceeded to consider whether the rules provided

sufficient warning that payments for services earned during the pendency 

of an appeal could be recouped. The district court determined that the 

DHS rules were conflicting and did not provide reasonable notice to 

Endress. The district court noted that Iowa Administrative Code rule 

441—7.9(1) provides that “[a]ssistance . . . shall not be suspended, 

reduced, restricted, or canceled, nor shall a license, registration, 

certification, approval, or accreditation be revoked or other proposed 

adverse action be taken pending a final decision on an appeal.” But rule 

441—170.9(2) states that “[a]ll overpayments due to client, provider, or 

agency error or due to benefits or payments issued pending an appeal 

decision shall be recouped.” Id. r. 441—170.9(2). And, rule 441—7.9(7) 

provides that “[c]ontinued assistance is subject to recovery by the 

department if the department’s action is affirmed. . . . When the 

department’s action is sustained, excess assistance paid pending a final 

decision shall be recovered to the date of the decision.” Id. r. 441—7.9(7).

The district court next turned to Iowa Administrative Code rule 

441—170.9. The district court found the rule conflicted with itself. Rule 

441—170.1 defines “overpayment” as “any benefit or payment received in 

an amount greater than the amount the client or provider is entitled to 

receive.” Id. r. 441—170.1. But under rule 441—7.9(1), DHS is required 

to pay petitioner during the period of appeal and prohibits DHS from 

revoking her approval as a provider under the CCA program. Id. r. 441—

7.9(1). Because Endress is entitled to receive payments during the 

pending of her appeal, the district court reasons that it is not an 

overpayment as an amount greater than the provider is entitled to receive.
26

The district court further noted that Iowa Administrative Code rule 

441—7.5(9) defines program overpayment to mean “child care assistance 

was received by or on behalf of a person in excess of that allowed by law, 

rules, or regulations for any given month.” But because Iowa 

Administrative Code rule 441—7.9(1) requires payment during the 

pendency of appeal, the district court reasoned that the provisions of Iowa 

Administrative Code rule 441—7.5(9) were not applicable.

Because the rules are conflicting and cannot be harmonized in a 

reasonable manner, the district court determined that the rules collectively 

have such total ambiguity that they “clearly, palpably, and without doubt 

infringe . . . the constitution.” 

The district court next turned to consider the statutory authority of 

DHS’s recoupment rules. The district court held that neither Iowa Code 

chapter 237A nor chapter 17A contained any language that would 

reasonably support recoupment as advocated by DHS. The district court 

noted that Iowa Code section 237A.13(4) provided that “if the department 

determines that a bill has an error or omission, the department shall notify 

the provider of the error or omission and identify any correction needed 

before issuance of payment to the provider.” But, according to the district 

court, there is nothing in Iowa Code chapter 237A.13 that authorizes DHS 

to recoup earned payments for services during the pendency of an appeal 

of an administrative decision canceling a provider contract. Further, the 

district court found nothing in Iowa Code chapter 17A to authorize the 

recoupment of funds paid during the pendency of an appeal.

The district court finally turned to unjust enrichment. The district 

court held that because the due process holdings of the court provided 

Endress with the relief she sought, there was no reason to exercise equity 

jurisdiction on an unjust enrichment theory.
27

The last issue considered by the district court was whether Endress 

was entitled to recover her attorney fees under Iowa Code section 625.29. 

The district court held that Endress was not entitled to fees. The district 

court reasoned that the action of DHS was primarily adjudicative because 

it determined the rights and duties of a party. Under the statute, attorney 

fees are not available when an agency acts in a primarily adjudicative 

capacity. 

Endress filed a motion to reconsider under Iowa Rule of Civil 

Procedure 1.904(2). Endress pointed out that in the administrative 

proceeding, the only question considered was the value of the alleged 

overpayment and that Endress did not contest its value. But Endress 

argued that the administrative law judge did not consider her challenge to 

the rules and notices on statutory and constitutional grounds and that, as 

a result, the action was not “primarily adjudicative.” 

5. Court of appeals. DHS appealed, and we transferred the case to 

the court of appeals. The court of appeals found that Iowa Code section 

237A.13(4) and Iowa Administrative Code rule 441—7.9 established a 

statutory property right in payments for child-care services. The court of 

appeals also agreed with the district court’s reasoning that the notices 

were constitutionally deficient to support DHS’s recoupment claim. The 

court of appeals, however, found that DHS’s action was not “primarily 

adjudicative” and that, as a result, Endress was entitled to attorney fees 

under Iowa Code section 625.29. 

II. Discussion.

A. The Notices to Endress Were Insufficient and Any Resulting 

Deprivation of Property Violated Due Process of Law.
28

1. Protected property interest. Iowa Code section 237A.13(4) 

provides a statutory property interest in payments for services under the 

program. This section provides,

The department’s billing and payment provisions for the 

program shall allow providers to elect either biweekly or 

monthly billing and payment for child care provided under the 

program. The department shall remit payment to a provider 

within ten business days of receiving a bill or claim for services 

provided. However, if the department determines that a bill 

has an error or omission, the department shall notify the 

provider of the error or omission and identify any correction 

needed before issuance of payment to the provider. The 

department shall provide the notice within five business days 

of receiving the billing from the provider and shall remit 

payment to the provider within ten business days of receiving 

the corrected billings.

This Code section mandates timely payments under the program and 

establishes a remedy in the event the department determines that an error 

or omission has occurred. I have no doubt that this statute, by directing 

and restraining the scope of administrative action in connection with 

payment for child care services, establishes a property interest in payment 

for the services that triggers due process protections. 

An argument could be made, perhaps, that the accompanying 

regulations eviscerate any statutory property interest by providing for 

recoupment of funds paid for services provided during the pendency of an 

administrative appeal. As demonstrated by the district court ruling, the 

DHS rules themselves are very hard to decipher and cannot be 

harmonized. 

But more importantly, in light of the statutory language in Iowa 

Code section 237A.13(4), I conclude that any rule that authorized 

recoupment as advocated by DHS would be ultra vires. To begin with, 

where the legislature has established remedies, I am not inclined to pencil 

into the statute additional remedies. That was the central teaching of 
29

Brakke v. Iowa Department of Natural Resources, 897 N.W.2d 522, 530, 

533–34, 540–41 (Iowa 2017). In Brakke, we refused to expand remedies 

in a statute regulating sick deer even though the agency believed expanded 

remedies would be administratively convenient or make the statute more 

effective. Id. at 540–42. 

Further, I note that the legislature knows how to enact recoupment 

provisions. Iowa Code section 96.3(7) provides for recoupment of 

unemployment benefits. Iowa Code section 96.3(11) provides for 

recoupment of food stamps. As the district court observed, “The 

possession of authority by one administrative body and the absence of a 

grant of such authority in the statute relating to another administrative 

body significantly shows that the latter body possesses no such authority.” 

Branderhorst v. Iowa State Highway Comm’n, 202 N.W.2d 38, 40 (Iowa 

1972). And, it makes sense for the legislature to expressly provide for 

recoupment of benefits but not recoupment of earned payments for 

services rendered. 

2. Procedural due process: notice. Endress received notice from 

DHS that “[a]ny benefits you get while your appeal is being decided may 

have to be paid back if the Department’s action is correct.” This notice 

does not provide fair warning that the clawback by the department of 

payments made will exceed those that the department has shown were 

improperly paid and would include payments fully earned by a provider. 

First, the notice refers to “benefits”. The payments to providers, 

however, are not benefits. Benefits are provided to families to utilize the 

services. The CCAP agreement makes no reference at all to benefits. Thus, 

a provider might well believe the notice did not apply to them but was 

boilerplate in DHS documents.
30

There is no question that the notice states that “any” benefits paid 

“may” have to be paid back. But may is not must. The term “may” 

ordinarily implies the use of some kind of discretion. See, e.g., 

Kingdomware Techs., Inc. v. United States, 579 U.S. ___, ___, 136 S. Ct. 

1969, 1977 (2016); Jama v. Immigration & Customs Enf’t, 543 U.S. 335, 

346, 125 S. Ct. 694, 703 (2005); John Deere Waterloo Tractor Works of 

Deere & Co. v. Derifield, 252 Iowa 1389, 1392, 110 N.W.2d 560, 562 (1961). 

In other words, DHS “may” in its discretion clawback paid benefits. We 

must, however, recognize and give effect to the choice of the word “may” 

and not “must” or “shall” in the notice. Fairfield Sci. Corp. v. United States, 

611 F.2d 854, 862 (Ct. Cl. 1979) (noting default clause in government 

contract does not say “shall” or “must” but says “may,” demonstrating the 

existence of discretion). 

Such discretion vested in an agency has been held to give rise to an 

implied condition of reasonableness in many settings. See, e.g., Darwin 

Constr. Co. v. United States, 811 F.2d 593, 596 (Fed. Cir. 1987); 

Schlesinger v. United States, 390 F.2d 702, 709 (Ct. Cl. 1968); Williamson 

v. N.Y. State Liquor Auth., 200 N.E.2d 565, 567 (N.Y. 1964). Thus, by 

analogy to the well-established principle that discretion must be 

reasonably exercised, to the extent “benefits” paid are unearned, or should 

not have been paid, the department may claw them back.

Assuming a provider would understand that he or she is receiving 

“benefits,” even though the provider is, in fact, getting paid for services 

rendered under the CCAP agreement, a reasonable provider reading the 

notice would assume that DHS would act rationally and not impose a 

disproportionate penalty for thousands of dollars for an accounting error 

of much lower proportion. The language in the notice does not remotely 
31

suggest, however, that the department may engage in grossly 

disproportionate, irrational clawback. 

The notice does not say, for instance, “If you are found to have 

erroneously billed DHS by any amount, including 1 cent, we will claw back 

the entire amount of payments made during the pendency of your appeal 

as a forfeiture.” In the alternative, the notice does not say, “You will have 

to pay back all payments earned for services rendered during the appeal if 

DHS prevails on the smallest billing issue as a forfeiture for using the 

administrative process.” The notice does not tell you that if you lose even 

the smallest aspect of your appeal, you will suffer a forfeiture or penalty.

If the state wanted to assert such an extraordinary unqualified 

power of forfeiture, it could have done so in simple, clear language. DHS’s 

position does not describe a reasonable discretionary clawback. It 

describes an unstoppable state-sanctioned steamroller that effectively and 

efficiently flattens license holders on the blacktop of an administrative 

appeal for the smallest of errors. 

The majority finds that the bland language gives fair notice of the 

existence of the unstoppable state-sanctioned forfeiture steamroller. I 

don’t see it. For sure, the notice gives fair warning that in the event you 

lose the appeal, the state will come after you and may even deduct from 

payments owed the amount of payments improperly billed. But the notice 

would not advise the average Jill or Joe that the state will clobber you if 

you get payments during the pendency of the appeal and you do not clean 

the state’s clock completely and thoroughly on each and every issue raised 

in the administrative appeal. 

If the notice were a statute, we would not construe it as does the 

majority. We may harken back to our law school days, where we learned 

that statutes should be construed to avoid forfeitures. United States v. 
32

One 1936 Model Ford V–8 Delux Coach, Motor No. 18-3306511, 307 U.S. 

219, 226, 59 S. Ct. 861, 865 (1939). While we are not faced with a 

question of statutory interpretation, it seems to me that we should require 

that notice of a forfeiture or penalty such as that advocated by DHS should 

be in very clear, maybe even in bold type. Cf. Bell v Yale Dev. Co., 429 

N.E.2d 894, 897 (Ill. Ct. App. 1981); Sclafani v. Eastman Kodak Co., 727 

N.Y.S.2d 277, 279–81 (Sup. Ct. 2001). 

The above problem is compounded by the phrase “if the 

Department’s action” is correct. What does that mean? What exactly is 

the department’s action? What about where the department’s position on 

incorrect billing is mostly wrong? 

For the above reasons, I conclude that the notices received by 

Endress were constitutionally deficient under the due process clauses of 

the Iowa and United States Constitutions. 

B. Unjust Enrichment. The plurality concludes that Endress is 

entitled to pursue an unjust enrichment claim in the district court. The 

plurality sees the same equities as I do in this case but puts it in a different 

legal package. In the alternative, however, since the due process argument 

as outlined in division II.A of my opinion has not prevailed, I too would 

remand to the district court for consideration of the unjust enrichment 

claim.

C. Attorney Fees Under Iowa Code Chapter 625.29. The key 

question under this fee-shifting statute is whether DHS’s action was 

“primarily adjudicative.” DHS’s position throughout, however, has been 

that the only issue in the administrative adjudication was the amount of 

overpayment as defined by DHS. The other powerful issues, including the 

validity of the rules and constitutional issues of due process, could not be 

decided in the administrative process.
33

Endress and DHS do not have a dispute about the amount of money 

received by Endress for earned services during the pendency of the original 

administrative appeal. No one disputes that it amounts to be about 

$16,000. Thus, the only issue that DHS believed could be considered in 

the administrative process was uncontested and does not have any 

bearing in this appeal.

In denying Endress’s claim for attorney fees, the district court stated 

that “the primary action in this case was to adjudicate the value of the 

overpayment.” I do not agree. Instead, the key issues in this case related 

to the statutory authority of DHS to promulgate rules and the application 

of due process to the agency’s action seeking to disgorge earned payments 

from Endress. These issues were not considered as they were outside the 

scope of the administrative process. As noted in Branstad v. State ex rel. 

Natural Resources Commission, the term adjudication in the statute means 

“to settle finally (the rights and duties of the parties to a court case) on the 

merits of the issues raised.” 871 N.W.2d 291, 297 (emphasis added) 

(quoting Webster’s Third New International Dictionary 27 (unabr. ed. 

2002)).

The fighting issues in this case, then, at least as they relate to due 

process, did not arise from an adjudication by DHS but instead arose from 

unreviewed administrative action of the department.4 Under these 

circumstances, I would find Iowa Code section 625.29 fully applicable. 

III. Conclusion.

For the above reasons, I would affirm the decision of the district 

court on the due process issue. In the alternative, I would remand the 

case to the district court for consideration of the unjust enrichment claim. 

 4The ALJ did, however, decide the unjust enrichment claim on the merits. Under 

our caselaw, if DHS is acting primarily in an adjudicative capacity, no attorney fees are 

available.
34

I would reverse the decision of the district court on the question of 

availability of attorney fees under Iowa Code section 625.29. 
35

#18–1329, Endress v. Iowa Dep’t of Human Servs.

McDONALD, Justice (concurring in part, dissenting in part).

I concur in part and dissent in part. I concur in the plurality 

opinion’s resolution of the due process issue. The plurality does not 

address the district court’s ruling or Endress’s argument that the Iowa 

Department of Human Services (DHS) exceeded its statutory authority in 

promulgating the recoupment rule. Nor does the plurality address the 

district court’s ruling or Endress’s argument that the recoupment rule is 

unconstitutionally vague. I assume the plurality concludes both that DHS 

had the authority to promulgate the recoupment rule and that the rule 

passes constitutional muster because the plurality remands the matter for 

reconsideration of Endress’s unjust enrichment claim asserted in response 

to enforcement of the rule. If the plurality so concludes, I concur that DHS 

had the authority to enact the rule and that the rule is not 

unconstitutionally vague. However, I disagree Endress can assert a 

defense of unjust enrichment in response to DHS’s effort to enforce a valid 

law, and I dissent on this issue. I thus join divisions III.A and III.C of Chief 

Justice Christensen’s opinion, while dissenting as to division III.B.

I.

The plurality dislikes the recoupment rule and the application of the 

recoupment rule because it works a hardship on Endress. Fair enough. I 

agree. However, “[o]ur job as judges is not to write a decision to avoid an 

unfair result.” Mulhern v. Catholic Health Initiatives, 799 N.W.2d 104, 126 

(Iowa 2011). Our job is to apply the law to the case at hand. At this job, 

the plurality falls short. The plurality relies on facts not supported by the 

record, uses these facts to construct a non sequitur, ignores controlling 

law, and then ignores the relevant portions of the persuasive authority 

upon which it relies that are directly contrary to the plurality opinion and 
36

that demand the opposite result. The end result is an opinion that is 

irreconcilable with itself and “an example of the aphorism that bad facts 

can make bad law.” Mitchell v. Cedar Rapids Cmty. Sch. Dist., 832 N.W.2d 

689, 705 (Iowa 2013) (Waterman, J., dissenting). 

A.

As an initial matter, this case does not appear to be a case, or at 

least a quintessential case, of unjust enrichment. The plurality states 

Endress provided a benefit to the state, but it is not clear she did. Endress 

provided child-care services to one or more persons while her appeal was 

pending. The beneficiaries of her services were the persons receiving the 

child-care services. See, e.g., Krieger v. Iowa Dep’t of Human Servs., 439 

N.W.2d 200, 203 (Iowa 1989) (“The DHS was not ‘enriched’ by the services 

rendered for the [beneficiary]. Krieger worked for the [beneficiary], not for 

the DHS, and the DHS received no benefits from his services.”). DHS was 

merely the third-party payor for the services provided. Endress’s claim of 

unjust enrichment more appropriately lies against the persons to whom 

she provided child-care services and not DHS. The plurality cites no case 

or authority allowing for a claim of unjust enrichment against a third-party 

payor under the circumstances presented. 

Finding no authority allowing for an unjust enrichment claim 

against a third-party payor, the plurality finds DHS was a direct 

beneficiary of Endress’s services. The plurality’s finding is based on the 

following facts and rationale: in some circumstances, certain day-care 

providers provide services for children with protective needs; this, 

according to the plurality, implicates the state’s duty as parens patriae; 

and, according to the plurality, when DHS acts as parens patriae it is the 

beneficiary of any services provided to the families. 
37

The doctrine of parens patriae is simply inapplicable here. There is 

nothing in the record to show Endress was providing protective services 

during the relevant time period. There is also nothing in the record to 

show the state was acting as parens patriae in this case. The fact that 

some other child-care providers might provide protective services for some 

other children under some other program not at issue in the case does not 

change the fact DHS was merely a third-party payor for the services 

Endress provided to someone else. 

Even if the doctrine were applicable here, the doctrine does not 

actually support Endress’s claim of unjust enrichment. The “doctrine is 

derived from the English common law and is inextricably linked to a 

superiority of the state in its relations with its subjects.” B.A.A. v. Chief 

Med. Officer, Univ. of Iowa Hosps., 421 N.W.2d 118, 121 (Iowa 1988) 

(quoting Contemporary Studies Project: Facts and Fallacies About Iowa Civil 

Commitment, 55 Iowa L. Rev. 895, 958–59 (1970)). It merely explains the 

state’s duty and authority to act to protect others. The plurality fails to 

cite any authority that would support a claim that an unauthorized service 

provider can demand money from the government or refuse to repay money 

lawfully owed the government merely because the government was acting 

in its capacity parens patriae. The invocation of the doctrine is a non 

sequitur.

B.

Even if one were to assume Endress’s provision of child-care services 

constituted a benefit to DHS, the principles underlying the doctrine of 

unjust enrichment do not support her claim. The doctrine of unjust 

enrichment is not an open-ended doctrine that allows a court to “sit like a 

kadi under a tree dispensing justice according to considerations of 

individual expediency.” Terminiello v. City of Chicago, 337 U.S. 1, 11, 69 
38

S. Ct. 894, 899 (1949) (Frankfurter, J., dissenting). “ ‘[U]njust enrichment’ 

is a term of art.” Restatement (Third) of Restitution & Unjust Enrichment 

§ 1 cmt. b, at 4 (Am. Law Inst. 2011) [hereinafter Restatement (Third)]. 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.” See id. at 5. In the 

technical sense, “[u]njustified enrichment is enrichment that lacks an 

adequate legal basis.” Id. 

To the extent DHS was enriched by Endress’s service, there is an 

adequate legal basis to justify the enrichment: Endress was given notice 

that any payments made to her under the child-care assistance program 

during the pendency of her appeal would have to be repaid in the event 

she lost her appeal. Specifically, the notice of decision told Endress she 

could “continue to receive child-care assistance funding pending the 

outcome of [her] appeal.” It continued, stating “any benefits [she receives] 

while [her] appeal is being decided may have to be paid back if the 

Department’s action is correct.” The notice then directed Endress to the 

administrative rule requiring recoupment. The plurality agrees DHS 

provided Endress notice that any compensation paid to her while her 

appeal was pending was subject to recoupment. 

DHS’s notice of recoupment to Endress precludes her defense of 

unjust enrichment against DHS. See Restatement (Third) § 16 cmt. a, at 

214 (explaining that a legal entity, such as government agency, would have 

a claim to recover benefits conferred under a contract where a statute 

limited the entity’s authority to contract); id. § 33 cmt. f, at 538 (explaining 

a party has no claim for unjust enrichment where the party acts despite 

having notice of a limitation on the government’s authority to contract 
39

“because the restitution claim may not be intentionally employed as a 

means either to circumvent procedural requirements or to expand the 

scope of [government] authority”). While the plurality relies on the 

Restatement (Third) to support its conclusion, it ignores these sections of 

the Restatement (Third) that directly address the question presented in 

this case and that expressly reject the plurality’s conclusion that unjust 

enrichment is available against the government where the party asserting 

the claim had notice. 

More problematic for the plurality is the Restatement (Third)’s rule 

is in accord with Iowa law. “The theory of unjust enrichment ‘is premised 

on the idea that it is unfair to allow a person to benefit from another’s 

services when the other expected compensation.’ ” Waldner v. Carr, 618 

F.3d 838, 848 (8th Cir. 2010) (quoting State Pub. Def. v. Iowa Dist. Ct. for 

Woodbury Cty., 731 N.W.2d 680, 684 (Iowa 2007)). When Endress 

pursued her administrative appeal, DHS provided her with notice she 

would have to repay the funds if her appeal was unsuccessful. The 

plurality opinion agrees DHS provided Endress with notice. Upon 

receiving notice, Endress had no expectation she would be able to retain 

the funds under the circumstances presented. In the absence of an 

expectation that she would be entitled to retain the funds, Endress has no 

claim for unjust enrichment. 

There is an additional adequate legal basis to justify DHS’s 

recoupment rule: the government’s general duty and authority to protect 

the fisc. See, e.g., Brock v. Pierce County, 476 U.S. 253, 262, 106 S. Ct. 

1834, 1840 (1986) (stating “the protection of the public fisc is a matter 

that is of interest to every citizen”). Part of the government’s general duty 

and authority to protect the fisc is the promulgation of statutes, rules, and 

regulations establishing the purposes, terms, and conditions for the 
40

expenditure of public funds. See Godfrey v. State, 847 N.W.2d 578, 588–

89 (Iowa 2014) (Waterman, J., dissenting) (explaining the legislature 

established a statutory certification procedure to determine when public 

funds should be available to defend a lawsuit and the statutory procedure 

should not be overridden by the court at the urging of a party’s attorney). 

An additional part of the government’s general duty and authority to 

protect the fisc is the recoupment of funds paid from the fisc where the 

payment violated the statutes, rules, and regulations authorizing the 

purpose, terms, and conditions for the expenditure of public funds. See 

Fernandez v. Iowa Dep’t of Human Servs., 375 N.W.2d 701, 709 (Iowa 

1985) (“More importantly, as a department of the state government it had 

a duty and implied authority to recoup from the provider payments 

incorrectly made when the payments were made because of rule violations 

by the provider.”); see also In re Holyoke Nursing Home, Inc., 372 F.3d 1, 5 

(1st Cir. 2004) (“Both by statute and by contract, the [government agency] 

has the unqualified right to recoup these overpayments in full, and to 

return the funds to the public fisc, where they can be used to fund other 

facilities providing care to . . . beneficiaries.” (Emphasis omitted.)).

The government’s general duty and authority to protect the fisc is so 

fundamental to the sound operation of government that certain claims and 

defenses cannot be asserted against the government to create liability or 

deny liability in contravention of statute. For example, “[l]aches . . . does 

not apply against the government.” State ex rel. Miller v. Vertrue, Inc., 834 

N.W.2d 12, 33 (Iowa 2013). “[I]n Iowa, it is well recognized that a statute 

of limitations does not run against the state unless specifically provided 

by statute.” Fennelly v. A-1 Mach. & Tool Co., 728 N.W.2d 163, 169 (Iowa 

2006). By way of another example, “no right of prescription may be 

acquired against the government.” State v. Hutchison, 721 N.W.2d 776, 
41

782 (Iowa 2006). Also, as a general rule, “equitable estoppel will not lie 

against a government agency.” ABC Disposal Sys., Inc. v. Dep’t of Nat. Res., 

681 N.W.2d 596, 607 (Iowa 2004). 

One of the claims that cannot be asserted against the government 

to create liability or, as here, as a defense to liability are claims of quantum 

meruit and unjust enrichment. See United States v. $30,006.25 in U.S. 

Currency, 236 F.3d 610, 614 (10th Cir. 2000) (“[W]e [are not] aware[] of 

any general waiver of sovereign immunity for unjust enrichment claims. 

Moreover, fairness or policy reasons cannot by themselves waive sovereign 

immunity.”); see also United States v. Craig, 694 F.3d 509, 513 (3d Cir. 

2012)). The appellate courts of this state have explicitly rejected the 

contention that a party can demand payment from the government under 

a theory of quantum meruit or unjust enrichment where the payment 

would be in contravention of statute. 

In Iowa District Court for Woodbury County, an attorney was 

appointed to serve as a guardian ad litem. 731 N.W.2d at 682. She failed 

to comply with the statutory requirements in submitting her application 

to exceed the statutory fee limitation. Id. The attorney sought fees for 

services she actually performed. 731 N.W.2d at 683. We disallowed the 

attorney’s demand for payment under a theory of quantum meruit on the 

ground that “[a]llowing a theory of quantum meruit to supersede clear 

statutory requirements would serve to undermine the legislature’s purpose 

in enacting section 815.10A(2).” Id. Similarly, in State Public Defender v. 

Iowa District Court for Clarke County, we concluded the district court erred 

in approving an attorney’s fee claim “based on the [district] court’s ‘plenary 

powers to exercise justice among the parties’ ” where the fee claim was 

contrary to statute. 745 N.W.2d 738, 739, 740 (Iowa 2008). Finally, in 

Madrid Lumber Co. v. Boone County, we held a contractor was not entitled 
42

to payment when it provided services to a county but the contract for the 

services was not approved in accord with statute. 255 Iowa 380, 386, 121 

N.W.2d 523, 527 (1963). 

The court of appeals has relied on our precedents in this area. The 

court of appeals has interpreted Iowa District Court for Woodbury County

for the proposition that a claim for quantum meruit “could not be used to 

supersede the affirmative requirements of the statute.” In re G.P., No. 09–

0156, 2009 WL 3337641, at *1 n.1 (Iowa Ct. App. Oct. 7, 2009). In 

Jacobsma v. Iowa District Court, No. 06–1877, 2007 WL 4553636, at *3 

(Iowa Ct. App. Dec. 28, 2007), the court of appeals rejected an attorney’s 

claim for compensation under theories of unjust enrichment and quantum 

meruit. The court explained it was for the legislature to address any 

inequity caused by the statutory requirements: 

While we sympathize with Jacobsma and understand his 

frustration with the public defender’s denial of his fee claim, 

it is up to the legislature and not this court to determine 

whether changes should be made in the fee approval/denial 

process it has established for court-appointed attorneys.

Id. The court of appeals’ rationale in Jacobsma is applicable here. While 

the plurality opinion may think the recoupment provision is unfair, this 

court does not have the authority to countermand a statute and 

administrative rule that six justices hold is valid and enforceable. 

Pursuant to this controlling authority, this court has explicitly 

rejected claims of unjust enrichment asserted against DHS and other 

government agencies. In Ahrendsen ex rel. Ahrendsen v. Iowa Department 

of Human Services, this court held a party’s claim of unjust enrichment 

would not lie where the department administered a program consistent 

with the relevant statutes and regulations. 613 N.W.2d 674, 679 (Iowa 

2000). In Marshall v. State, this court explained the department was 
43

required and entitled to recoupment of welfare benefits despite it being a 

“harsh result.” 559 N.W.2d 612, 613, 615 (Iowa 1997). The court further 

explained it lacked the authority to modify the statutory regime to achieve 

an “equitable result.” Id. at 615. Similarly, in Krieger, this court rejected 

the claimant’s contention the department would be unjustly enriched by 

recoupment of benefits paid. 439 N.W.2d at 203. This court explained 

there was strong public policy supporting the enforcement of the 

recoupment statute and “denying recoupment would frustrate that policy.” 

Id. Our cases are consistent with the Restatement (Third)’s legal standard 

of unjust enrichment as opposed to the plurality’s moral standard of 

unjust enrichment.

The government’s duty and authority to recoup funds hold even 

when the recipient of said funds was not at fault and the recoupment of 

said funds might be inequitable, in the colloquial sense, under the 

circumstances presented. See State ex rel. Mack v. Mack, 479 N.W.2d 327, 

329 (Iowa 1992) (“However sympathetic Michele’s plight may be, her legal 

defenses to the State’s reimbursement effort lack merit.”); Fernandez, 375 

N.W.2d at 709 (“We conclude that the hearing officer’s interpretation that 

the administrative rules gave the department authority to recover from the 

appellant any incorrectly paid assistance by suspending or withholding 

[M]edicaid payments is neither plainly erroneous nor inconsistent with 

chapter 249A.”); Powell v. Emp’t Appeal Bd., 861 N.W.2d 279, 281 (Iowa 

Ct. App. 2014) (holding state was entitled to recoupment of unemployment 

compensation benefits notwithstanding the recipient’s “lack of fault in 

incurring the overpayment”); see also Heckler v. Cmty. Health Servs. of 

Crawford Cty., Inc., 467 U.S. 51, 62, 104 S. Ct. 2218, 2225 (1984) (“There 

is no doubt that respondent will be adversely affected by the Government’s 

recoupment of the funds that it has already spent. It will surely have to 
44

curtail its operations and may even be forced to seek relief from its debts 

through bankruptcy. . . . [B]ut questions concerning the Government’s 

method of enforcing collection are not before us.”).

There is a related but additional reason Endress’s claim of unjust 

enrichment fails here: DHS’s general interest in protecting the fisc is 

bolstered in this case by federal command. The federal government 

provides funding to the states for child-care programs and services 

pursuant to the Child Care and Development Block Grant. See 42 U.S.C. 

§§ 618, 9858 (2018). Funds from the block grant program are placed with 

matching dollars from the state into the Child Care Development Fund. 

See id. §§ 618(a)(2), 9858. Pursuant to federal law, DHS is required to 

administer the Child Care Development Fund “responsibly to ensure that 

statutory requirements are met.” 45 C.F.R. § 98.1(b)(6)(2019). DHS also 

has the “overall responsibility for the administration of the program.” Id.

§ 98.11(b);see also 42 U.S.C. § 9858b (requiring a lead agency and 

outlining its duties). This includes the duty to promulgate rules and 

regulations for the program and the duty to oversee the funds. See 45 

C.F.R. § 98.11(b)(1)–(8); see also 42 U.S.C. § 9858c (outlining 

administration and enforcement guidelines). This also includes the duty 

to regulate who can receive payment as an eligible child-care provider. See

45 C.F.R. § 98.2 (defining eligible child-care provider); id. § 98.40–.41 

(discussing eligibility criteria).

In seeking recoupment, the state, generally, and DHS, specifically, 

are discharging their obligation to administer the Child Care Development 

Fund in a lawful manner. The Iowa General Assembly instructed DHS to 

implement rules for the “administration” of the program. See Iowa Code 

§ 237A.12(1)(g) (2017). This included rules to govern the disbursement 

and recoupment of funds for the child-care assistance program at issue in 
45

this case. DHS’s rules provide “excess assistance paid pending a final 

decision shall be recovered to the date of the decision.” Iowa Admin. Code 

r. 441—7.9(7) (2017). DHS’s rules provide DHS shall recoup all “benefits 

or payments issued pending an appeal decision.” Id. r. 441—170.9(2). The 

plurality agrees DHS had the authority to promulgate and enforce the 

rules. The recoupment proceeding here is thus merely the lawful 

enforcement of valid rules. 

No claim of unjust enrichment lies under the circumstances 

presented in this case. The law of restitution is not concerned “with 

unjust enrichment in any such broad sense . . . because the justification 

in question is not moral but legal.” Restatement (Third) § 1 cmt. b, at 5. 

Properly understood, unjust enrichment is not applicable where there is a 

legal justification for the enrichment. See id. There are numerous legal 

justifications why Endress cannot assert a defense of unjust enrichment

against DHS. The plurality simply ignores the black letter law and the 

controlling precedents requiring that conclusion. The plurality’s failure to 

follow the relevant principles and precedents renders the plurality opinion 

irreconcilable with itself. The plurality holds DHS’s recoupment statute 

and rule are valid and enforceable except when DHS seeks to enforce the 

statute and rule. The plurality’s fallacious expansion of the doctrine of 

unjust enrichment is bad law. “[U]njust enrichment is not a catchall cause 

of action to be used when others fail.” Corsello v. Verizon N.Y., Inc., 967 

N.E.2d 1177, 1185 (N.Y. 2012). 

C.

Not only is the plurality opinion bad law, it is bad policy. The 

plurality ignores the adverse impact its decision will have on the 

administration of the child-care assistance program. Child-care 

assistance providers now have additional incentive to appeal contract 
46

termination decisions and drag out the administrative appeal process for 

as long as possible. The plurality rule removes all risk to the child-care 

assistance providers from pursuing an appeal of DHS’s decision to 

terminate a provider agreement given that DHS is now powerless to recoup 

funds paid during the appeal period. The plurality rule is bad policy and 

forces DHS into de facto noncompliance with its federal and state 

mandates. 

II.

Unfortunately for the legislative and the executive branches, there 

is no way to fix the problem the plurality opinion creates. The plurality 

concludes the legislature passed a law allowing recoupment of payments 

made to unlicensed providers. The plurality concludes DHS passed a rule 

allowing recoupment of payments made to unlicensed providers. The 

plurality concludes these laws are valid, pass constitutional muster, and 

are enforceable except when DHS seeks to enforce them. Under the 

plurality’s interpretation, the legislative and executive branches are not 

entitled to set the terms and conditions upon which funds can be 

disbursed from the public fisc if the court does not think it fair. That is a 

shocking conclusion. Literally unprecedented. The plurality opinion does 

not cite a single case in which a payee was able to successfully assert a 

claim for unjust enrichment against the government where, pursuant to a 

valid statute and administrative rule, the government put the payee on 

notice the government would seek recoupment of payments because the 

payee was not eligible to receive the payments. The legislative and 

executive branches have no recourse. What can they do? Reenact the

same law the plurality concludes is valid except this time with the proviso, 

“This time, we really, really mean it.” I dissent.

Oxley and McDermott, JJ., join this concurrence in part and dissent 

in part.