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Jill B. and Travis B., individually and as parents

and next friends of B.B., a minor child, 

appellants, v. State of Nebraska and

the Nebraska Department of Health

and Human Services, appellees.

___ N.W.2d ___

Filed June 30, 2017. No. S-15-778.

1. Tort Claims Act: Appeal and Error. In actions brought pursuant to 

the State Tort Claims Act, the factual findings of the trial court will 

not be disturbed on appeal unless they are clearly wrong, and when 

determining the sufficiency of the evidence to sustain the verdict, it 

must be considered in the light most favorable to the successful party. 

Every controverted fact must be resolved in favor of such party, and it is 

entitled to the benefit of every inference that can reasonably be deduced 

from the evidence.

2. Statutes: Appeal and Error. The meaning and interpretation of a statute are questions of law. An appellate court independently reviews questions of law decided by a lower court.

3. Actions: Appeal and Error. The law-of-the-case doctrine reflects the 

principle that an issue that has been litigated and decided in one stage of 

a case should not be relitigated at a later stage.

4. Summary Judgment. The overruling of a motion for summary judgment does not decide any issue of fact or proposition of law affecting 

the subject matter of the litigation, but merely indicates that the court 

was not convinced by the record that there was not a genuine issue as 

to any material fact or that the party offering the motion was entitled to 

judgment as a matter of law.

5. Actions: Final Orders: Appeal and Error. The law-of-the-case doctrine requires a final order. A party is not bound by a court’s findings in 

an order that it was not required to appeal.

Nebraska Supreme Court Online Library

www.nebraska.gov/apps-courts-epub/

08/18/2017 01:09 AM CDT
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6. Summary Judgment: Final Orders: Appeal and Error. A denial of 

a motion for summary judgment is an interlocutory order, not a final 

order, and therefore not appealable.

7. Tort Claims Act: Immunity: Waiver: Pleadings: Proof. The exceptions found in Neb. Rev. Stat. § 81-8,219 (Reissue 2014) to the general 

waiver of tort immunity are matters of defense which must be pled and 

proved by the State.

8. Pleadings: Notice. The key to determining the sufficiency of pleading 

an affirmative defense is whether it gives the plaintiff fair notice of 

the defense.

9. Pretrial Procedure: Pleadings. The issues set out in a pretrial order 

supplant those raised in the pleadings.

10. Tort Claims Act: Legislature: Immunity: Waiver. Through the State 

Tort Claims Act, the Legislature has waived the State’s immunity with 

respect to certain, but not all, types of tort actions.

11. Tort Claims Act: Immunity: Waiver. Under the intentional torts exception, sovereign immunity is not waived for claims arising out of assault, 

battery, false imprisonment, false arrest, malicious prosecution, abuse 

of process, libel, slander, misrepresentation, deceit, or interference with 

contract rights.

12. Statutes: Immunity: Waiver. Statutes that purport to waive the protection of sovereign immunity of the State or its subdivisions are strictly 

construed in favor of the sovereign and against the waiver. A waiver of 

sovereign immunity is found only where stated by the most express language of a statute or by such overwhelming implication from the text as 

will allow no other reasonable construction.

13. Statutes: Appeal and Error. Statutory language is to be given its plain 

and ordinary meaning, and an appellate court will not resort to interpretation to ascertain the meaning of statutory words which are plain, 

direct, and unambiguous.

14. Tort Claims Act: Immunity: Waiver. The misrepresentation exception 

to the waiver of sovereign immunity can apply to claims for personal 

injuries as well as economic injuries and to claims not involving business transactions.

15. ____: ____: ____. The misrepresentation exception to the waiver 

of sovereign immunity must be strictly construed in favor of the 

government.

16. Tort Claims Act: Immunity: Waiver: Case Disapproved. Fuhrman 

v. State, 265 Neb. 176, 655 N.W.2d 866 (2003), is disapproved to the 

extent it holds that a complete failure to convey critical information, 

without an inference that this was deliberately done, falls outside the 

misrepresentation exception to the waiver of sovereign immunity.
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17. Tort Claims Act: Pleadings. A plaintiff cannot circumvent the misrepresentation exception simply through artful pleading of its claims.

Appeal from the District Court for Gage County: Paul W. 

Korslund, Judge. Affirmed.

Ryan P. Watson and Jeffrey A. Wagner, of Schirber & 

Wagner, L.L.P., for appellants.

Douglas J. Peterson, Attorney General, David A. Lopez, and 

Bijan Koohmaraie for appellees.

Heavican, C.J., Wright, Miller-Lerman, Cassel, Stacy, 

Kelch, and Funke, JJ.

Cassel, J.

I. INTRODUCTION

A state employee falsely told the parents of a child that 

K.D.M., a potential adoptee, had no sexual abuse history. 

Upon placement in their home, K.D.M. sexually assaulted the 

parents’ child. They sued for money damages under the State 

Tort Claims Act.1 After a bench trial,2 the district court found 

the State of Nebraska and the Nebraska Department of Health 

and Human Services (collectively the State) immune from suit 

under the exception for misrepresentation and deceit.3 The parents appeal, and we affirm. Because the employee consciously 

deceived the parents, the exception applies. Our decision is 

driven by the highly deferential standard used to review the 

district court’s factual findings and the strict construction we 

must give to waivers of sovereign immunity.

II. BACKGROUND

Because the State prevailed at trial, we summarize the facts 

in the light most favorable to it.

1 Neb. Rev. Stat. §§ 81-8,209 to 81-8,235 (Reissue 2014).

2 See § 81-8,214 (district court, sitting without jury, has exclusive original 

jurisdiction).

3 See § 81-8,219(4).
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1. Events

In May 2010, the parents, Jill B. and Travis B., became 

interested in adopting K.D.M. On at least three occasions, Jill 

asked Jodene Gall, a children and family services specialist 

with the State, whether K.D.M.’s background had anything 

“sexually” in it and Gall responded “no.” Gall told Jill only 

that there had been concerns about “inappropriate” contact 

between K.D.M. and his brother. K.D.M. was placed in the 

parents’ home in July.

Gall, however, was aware of allegations that K.D.M. had 

been sexually abused. She learned this information by reviewing information contained in the computer database and the 

master case file, which is a paper file.

Approximately 5 months after K.D.M. was placed in the 

parents’ home, the parents learned that K.D.M. had sexually 

abused their child.

2. Lawsuit

The parents, individually and as parents and next friends of 

their minor child, brought a negligence claim against the State. 

They alleged failure to warn or disclose and failure to supervise. The State asserted the affirmative defense of immunity 

under § 81-8,219(4), claiming that the case constituted a claim 

arising out of misrepresentation or deceit, because the withholding of information by Gall was intentional.

The State filed a motion for summary judgment, which 

the district court overruled. The court stated that it was clear 

Gall intentionally concealed K.D.M.’s sexual history from 

the parents, but that there was evidence she did not read the 

reports which detailed the sexual history and was not aware 

of how serious it was. The court reasoned that it could not 

conclude Gall’s intentional concealment of K.D.M.’s sexual 

history was the sole proximate cause of damages when there 

was evidence that the proximate cause was Gall’s failure to 

be fully aware of the file and forensic reports. The matter 

proceeded to trial.
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During the bench trial, Gall testified about her awareness 

of K.D.M.’s background. When she first spoke with Jill, Gall 

knew that K.D.M. “had some inappropriate contact” with a 

relative. Gall believed that she told the parents there had been 

“inappropriate contact,” but she did not believe she elaborated. 

And Gall testified that she did not know the full extent of 

K.D.M.’s sexual abuse at that time.

But there was evidence from which the district court could 

conclude that from the beginning of her contacts with the 

parents, Gall knew the full extent of K.D.M.’s sexual history. 

Gall admitted that when K.D.M. was placed with the parents, 

she was aware of allegations that he had been sexually abused 

and that he had a history of sexually acting out. She admitted 

that she was assigned to K.D.M.’s case in 2007 or 2008. She 

admitted that in 2007, she drafted a “private narrative” section of an adoption form regarding K.D.M. She admitted that 

the first sentence of the private narrative stated, “‘[K.D.M.] 

would best fit in a family with two parents, preferably no 

other children.’” She admitted that this opinion “could have 

been” based on her knowledge of K.D.M.’s sexual history. 

In an email from Gall to other personnel of the State, Gall 

recalled the allegations of a particular intake. She admitted at 

trial that in the email, she was referring to the intake received 

as exhibit 35. And she admitted that exhibit 35 was the source 

of her information or knowledge regarding K.D.M.’s sexual 

history. One of the State’s child and family services supervisors explained that the information from this intake form was 

derived from forensic interviews conducted by a child advocacy center. The supervisor also testified that Gall said “she 

didn’t feel like she would have to call [K.D.M.] a perp for the 

rest of his life.”

3. District Court’s Judgment

The district court entered judgment in favor of the State. 

Ultimately, the court reasoned that the State’s liability “rises 

and falls on whether [K.D.M.’s] sexual abuse history was disclosed, not on whether or not the information was available 
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to [Gall] and whether [Gall] was negligently trained and 

supervised.” The court also stated that “the information 

was available to [Gall,] and she was not negligently trained 

and supervised.”

The district court made numerous factual findings, and we 

quote the findings bearing on Gall’s intent as follows:

8. [Gall] was actually aware that [K.D.M.’s] background included some instances of sexual abuse and inappropriate sexual contact with a sibling at the time of the 

[parents’] inquiries.

9. During the preliminary meetings and evaluations, 

[Gall] also represented to . . . a licensed mental health 

counselor who was assisting with the placement process[] that [K.D.M.] had no sexual abuse history as either 

a victim or perpetrator.

10. [Gall] was not authorized with discretion to withhold relevant information concerning the sexual abuse 

history of [K.D.M.]

11. Even while [Gall] knew that [K.D.M.’s] background included allegations of sexual abuse and inappropriate sexual contact and acting out, and despite her 

awareness that the [parents] were very concerned about 

whether [K.D.M.] had any history that included sexual 

activity, [K.D.M.] was placed in the [parents’] home 

in 2010.

The district court concluded that the parents presented a 

case “rooted in and inextricably intertwined with multiple 

instances of misrepresentation” by Gall. Because the State Tort 

Claims Act “specifically excepts from its waiver of governmental immunity claims that are based on misrepresentation 

and deceit,” the court dismissed the complaint.

The parents filed a timely appeal, and we granted their petition to bypass review by the Nebraska Court of Appeals.

III. ASSIGNMENTS OF ERROR

The parents assign four errors, which we have restated and 

reordered. We first address their assignments that the district 
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court erred in not applying the law-of-the-case doctrine and 

in finding the misrepresentation exception had been properly 

asserted as an affirmative defense. We then consider the heart 

of the appeal, where they attack the court’s determination that 

the State was immune under the exception for misrepresentation or deceit. Finally, we discuss the assignment of error 

regarding the court’s finding that Gall was not negligently 

trained and supervised.

IV. STANDARD OF REVIEW

[1] In actions brought pursuant to the State Tort Claims Act, 

the factual findings of the trial court will not be disturbed on 

appeal unless they are clearly wrong, and when determining 

the sufficiency of the evidence to sustain the verdict, it must be 

considered in the light most favorable to the successful party. 

Every controverted fact must be resolved in favor of such 

party, and it is entitled to the benefit of every inference that can 

reasonably be deduced from the evidence.4

[2] The meaning and interpretation of a statute are questions 

of law. An appellate court independently reviews questions of 

law decided by a lower court.5

V. ANALYSIS

We briefly dispose of two procedural issues.

1. Law-of-the-Case Doctrine

[3] The parents argue that the district court erred in failing to apply the law-of-the-case doctrine. The law-of-the-case 

doctrine reflects the principle that an issue that has been litigated and decided in one stage of a case should not be relitigated at a later stage.6

The parents reason that in overruling the State’s motion for 

summary judgment, the district court determined that immunity did not apply. We disagree for two reasons.

4 Fuhrman v. State, 265 Neb. 176, 655 N.W.2d 866 (2003).

5 Hopkins v. Hopkins, 294 Neb. 417, 883 N.W.2d 363 (2016).

6 Sickler v. Sickler, 293 Neb. 521, 878 N.W.2d 549 (2016).
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[4] First, the parents’ premise is wrong. The overruling of 

a motion for summary judgment does not decide any issue of 

fact or proposition of law affecting the subject matter of the 

litigation, but merely indicates that the court was not convinced 

by the record that there was not a genuine issue as to any material fact or that the party offering the motion was entitled to 

judgment as a matter of law.7 Here, the district court did not 

decide that immunity did not apply, it merely decided that there 

was a genuine issue of fact for trial.

[5,6] Second, the law-of-the-case doctrine requires a final 

order. A party is not bound by a court’s findings in an order 

that it was not required to appeal.8 But here, neither party was 

permitted, much less required, to appeal. A denial of a motion 

for summary judgment is an interlocutory order, not a final 

order, and therefore not appealable.9 Thus, the law-of-the-case 

doctrine did not preclude the district court from addressing 

immunity at trial.

2. Affirmative Defense Asserted

 [7,8] The exceptions found in § 81-8,219 to the general 

waiver of tort immunity are matters of defense which must be 

pled and proved by the State.10 The parents contend that the 

State failed to properly plead the misrepresentation exception 

as an affirmative defense. But we have recognized that the federal rules of pleading, which Nebraska has generally adopted, 

were designed to liberalize pleading requirements.11 The key to 

determining the sufficiency of pleading an affirmative defense 

is whether it gives the plaintiff fair notice of the defense.12

7 Big River Constr. Co. v. L & H Properties, 268 Neb. 207, 681 N.W.2d 751 

(2004).

8 In re 2007 Appropriations of Niobrara River Waters, 283 Neb. 629, 820 

N.W.2d 44 (2012).

9 Breci v. St. Paul Mercury Ins. Co., 288 Neb. 626, 849 N.W.2d 523 (2014).

10 See Sherrod v. State, 251 Neb. 355, 557 N.W.2d 634 (1997).

11 SFI Ltd. Partnership 8 v. Carroll, 288 Neb. 698, 851 N.W.2d 82 (2014).

12 Linscott v. Shasteen, 288 Neb. 276, 847 N.W.2d 283 (2014).
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Although the State’s operative answer was not perfect, the 

parents were afforded fair notice of the nature of the defense 

asserted by the State. Despite references to the “Amended 

Complaint” throughout the State’s answer, the answer was 

clearly filed in response to the parents’ second amended complaint. Indeed, the State’s pleading was titled “Defendant’s 

Answer to Second Amended Complaint.” The parents also 

point out that the answer referred to intentional conduct and 

that their operative complaint alleged only negligent conduct. But the answer, by referring to “misrepresentation or 

deceit” and to § 81-8,219(4), clearly placed the parents on 

notice of the State’s intent to raise sovereign immunity as a 

defense. We reject their hypertechnical attempt to parse the 

State’s pleading.

[9] Moreover, the district court’s pretrial order cured any 

question whether the defense was raised. The issues set out in 

a pretrial order supplant those raised in the pleadings.13 The 

court incorporated into its pretrial order an issue framed in 

the State’s pretrial conference statement: “Whether the intentional torts exception to the Nebraska State Tort Claims Act 

operates as a complete bar to [the parents’] recovery from the 

State.” (Emphasis supplied.) The State characterizes this as 

“shorthand”14 and correctly notes that we have used this terminology regarding § 81-8,219(4).15 The parents do not argue 

that they were misled or surprised by the State’s arguments 

regarding misrepresentation or deceit. This assignment of error 

lacks merit.

3. Misrepresentation Exception

The parents’ principal assignment of error asserts that 

the district court erred in finding their claim fell within the 

“[m]isrepresentation [e]xception”16 of the State Tort Claims 

13 Cotton v. Ostroski, 250 Neb. 911, 554 N.W.2d 130 (1996).

14 Brief for appellees at 12.

15 See Johnson v. State, 270 Neb. 316, 700 N.W.2d 620 (2005).

16 Brief for appellants at 20.
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Act. But the parties argue both misrepresentation and deceit. 

Both terms are specified in § 81-8,219(4).

Before recalling the historical development and basic principles of sovereign immunity and its waiver, a simple illustration is helpful. Imagine two automobiles being operated by 

employees in the course of performing tasks for their respective employers. If A, an employee of XYZ Corp., becomes 

distracted and negligently causes injury to another person, 

XYZ Corp. is liable. If B, an employee of the State, does 

so, the State is liable. But if A or B becomes enraged at 

another driver and intentionally collides with the other vehicle, thereby injuring the other driver (a battery), the results 

differ. XYZ Corp. would be liable for A’s intentional act,17

but the State would be immune from suit for B’s similar act. 

Although this seems counterintuitive, there is a rationale supporting the distinction.

(a) Sovereign Immunity Prior to 

State Tort Claims Act

It had been long “laid down as a universal rule that a state is 

not liable to a person injured by the negligence of its employees, unless there is a statute or constitutional provision permitting recovery.”18 We explained that the constitutional provision19 permitting the State to be sued is not self-executing and 

requires legislative action to make it effective.20

The rule of sovereign immunity has been characterized as “‘an 

ancient rule inherited from the days of absolute monarchy’”21

or, less pejoratively, as an inheritance of 18th-century English 

law.22 It rests upon a broad doctrine recognizing the right of 

17 See Rich v. Dugan, 135 Neb. 63, 280 N.W. 225 (1938).

18 Shear v. State, 117 Neb. 865, 866, 223 N.W. 130, 130 (1929).

19 Neb. Const. art. V, § 22.

20 See Shear v. State, supra note 18.

21 See Stadler v. Curtis Gas, Inc., 182 Neb. 6, 9, 151 N.W.2d 915, 918 (1967) 

(Newton, J., dissenting; White, C.J., and Carter, J., concurring in dissent). 

22 See Comment, The Federal Tort Claims Act, 56 Yale L.J. 534 (1947).
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sovereign authority to be free of such liability except to the 

extent that it is waived or abrogated by the Legislature.23 The 

doctrine predated our state constitution, which was adopted 

with this rule in mind.24

Although the rule had been challenged for decades,25 our 

1967 decision26 by a divided court prompted legislative action. 

As a dissenting judge observed pungently, “logic dictates that 

a person run over by a state-owned truck should have the same 

right to recover as one run over by a privately owned truck.”27

Two members of the majority concurred and remarked that the 

“implications [of the majority opinion] suggest the desirability 

of legislative action.”28

(b) State Tort Claims Act

In 1969, the Legislature responded to the call for action.29

But it did not abolish the rule of sovereign immunity. Instead, 

it used the Federal Tort Claims Act (FTCA)30 as a model.

[10] Through the State Tort Claims Act, the Legislature has 

waived the State’s immunity with respect to certain, but not 

all, types of tort actions.31 As pertinent here, the act waives the 

23 See Stadler v. Curtis Gas, Inc., supra note 21 (Carter, J., dissenting; 

White, C.J., and Newton, J., join).

24 See id. (Newton, J., dissenting; White, C.J., and Carter, J., concurring in 

dissent).

25 See id. (McCown, J., concurring; Spencer, J., joins).

26 See id.

27 Id. at 9, 151 N.W.2d at 918 (Newton, J., dissenting; White, C.J., and 

Carter, J., concurring in dissent).

28 Id. at 22, 151 N.W.2d at 924 (McCown, J., concurring; Spencer, J., joins).

29 See 1969 Neb. Laws, L.B. 154. See, also, Minutes of Committee on 

Judiciary, L.B. 154, 80th Leg., 1st Sess. (Feb. 3, 1969); Committee 

Statement, L.B. 154, Judiciary Committee, 80th Leg., 1st Sess. (Feb. 6, 

1969); Floor Debate, L.B. 154, 80th Leg., 1st Sess. 841 (Mar. 26, 1969).

30 28 U.S.C. §§ 1346(b) and 2671 to 2680 (1964 & Supp. III).

31 See, Lamb v. Fraternal Order of Police Lodge No. 36, 293 Neb. 138, 876 

N.W.2d 388 (2016); Johnson v. State, supra note 15.
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State’s sovereign immunity for tort claims against the State on 

account of personal injury caused by the negligent or wrongful act or omission of any employee of the State, while acting 

within the scope of his or her office or employment, under 

circumstances in which the State, if a private person, would be 

liable to the claimant for such injury.32

[11] The Legislature included within the act specific exceptions to the waiver of sovereign immunity. Under the intentional torts exception, sovereign immunity is not waived for 

claims “arising out of assault, battery, false imprisonment, 

false arrest, malicious prosecution, abuse of process, libel, 

slander, misrepresentation, deceit, or interference with contract rights.”33 Our attention focuses on misrepresentation 

and deceit.

(c) Strict Construction

[12,13] It is well settled that statutes that purport to waive 

the protection of sovereign immunity of the State or its 

subdivisions are strictly construed in favor of the sovereign 

and against the waiver. A waiver of sovereign immunity is 

found only where stated by the most express language of a 

statute or by such overwhelming implication from the text 

as will allow no other reasonable construction.34 Statutory 

language is to be given its plain and ordinary meaning, and 

an appellate court will not resort to interpretation to ascertain 

the meaning of statutory words which are plain, direct, and 

unambiguous.35

The principle of strict construction predated the State Tort 

Claims Act and has been consistently followed after its adoption. We had long said that statutes authorizing suit against 

32 See § 81-8,210(4).

33 § 81-8,219(4).

34 Lamb v. Fraternal Order of Police Lodge No. 36, supra note 31.

35 Stewart v. Nebraska Dept. of Rev., 294 Neb. 1010, 885 N.W.2d 723 

(2016).
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the State are to be strictly construed, since they are in derogation of the State’s sovereignty.36 Following adoption of the 

State Tort Claims Act, we emphasized that statutes in derogation of sovereignty should be strictly construed in favor 

of the State, so that its sovereignty may be upheld and not 

narrowed or destroyed, and should not be permitted to divest 

the State or its government of any of its prerogatives, rights, 

or remedies, unless the intention of the Legislature to effect 

this object is clearly expressed.37 We also said that because 

the State has given only conditional consent to be sued and 

there is no absolute waiver of immunity by the State, requirements of the State Tort Claims Act must be followed strictly.38

Our most recent pronouncements uphold these principles.39

Because the rationale for the intentional torts exception, 

including the exceptions for misrepresentation and deceit, has 

not always been clearly expressed, the rule of strict construction becomes critically important.

(d) Rationale of FTCA

We have recognized that Nebraska’s State Tort Claims Act is 

patterned after the FTCA.40 The FTCA contains an intentional 

36 See Anstine v. State, 137 Neb. 148, 288 N.W. 525 (1939), overruled on 

other grounds, Beatrice Manor v. Department of Health, 219 Neb. 141, 

362 N.W.2d 45 (1985), and Pointer v. State, 219 Neb. 315, 363 N.W.2d 

164 (1985).

37 Catania v. The University of Nebraska, 204 Neb. 304, 282 N.W.2d 27 

(1979), overruled on other grounds, Blitzkie v. State, 228 Neb. 409, 422 

N.W.2d 773 (1988).

38 Wickersham v. State, 218 Neb. 175, 354 N.W.2d 134 (1984), disapproved 

on other grounds, D.K. Buskirk & Sons v. State, 252 Neb. 84, 560 N.W.2d 

462 (1997).

39 See, e.g., Dean v. State, 288 Neb. 530, 849 N.W.2d 138 (2014); Zawaideh 

v. Nebraska Dept. of Health & Human Servs., 285 Neb. 48, 825 N.W.2d 

204 (2013); Cotton v. State, 281 Neb. 789, 810 N.W.2d 132 (2011); 

Johnson v. State, supra note 15.

40 Johnson v. State, supra note 15.
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torts exception.41 Prior to a 1974 amendment42 not relevant 

here, the language was identical.

A majority of the U.S. Supreme Court has not spoken to the 

rationale underlying the intentional torts exception, but a plurality has touched on it. And several commentators and lower 

federal courts have spoken more directly. We summarize them 

chronologically to illustrate the rationale’s development.

The first comment43 came from the academy, soon after the 

FTCA was adopted. Referring to all of the exceptions, including § 2680(h), it argued that because the FTCA was “in itself 

a denial of the validity of conceptualistic sovereign immunity,” the exceptions must seek “justification in some practical 

necessity.”44 Turning to § 2680(h), its rationale was found in 

committee hearings of an earlier act and was the “difficulty of 

defending such suits and the probability of judgments against 

the Government in amounts out of proportion to the damages 

actually suffered by claimants.”45 The article recognized that 

“this sweeping exception imposes a hardship upon claimants 

and leaves open one fruitful source of private claim bills.”46 In 

other words, the only remedy in that situation was in Congress 

and not in the courts.

In a 1954 decision regarding the “assault” and “battery” 

parts of the exception, the Second Circuit posited that “high 

standards of public service would be promoted by government employees knowing that they could not engage in such 

lawless activities at government expense.”47 Alternatively, the 

court suggested that the excepted activities were viewed as 

41 See 28 U.S.C. § 2680(h) (2012).

42 See Pub. L. 93-253, § 2, 88 Stat. 50.

43 See Comment, supra note 22.

44 Id. at 543.

45 Id. at 547.

46 Id.

47 Panella v. United States, 216 F.2d 622, 625 (1954).
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“practically, even though not legally, speaking [as] outside the 

scope of a government employee’s proper official functions, or 

in any event unusually difficult for the Government to defend 

against.”48 Citing to the earlier hearings noted from what the 

court described as a “meagre legislative history,”49 the court 

quoted a Department of Justice representative’s testimony that 

these were “‘torts which would be difficult to make a defense 

against, and which are easily exaggerated. For that reason it 

seemed to those who framed this bill that it would be safe to 

exclude those types of torts, and those should be settled on the 

basis of private acts.’”50

The view from the academy in 1957 recognized that these 

torts were “not actionable under the [FTCA],”51 and called for 

Congress to reassess the preservation of this immunity, opining 

that “the desirability of compensation seems to outweigh the 

fear of excessive damages.”52 But Congress has not reassessed 

the exception, except for the 1974 amendment having no application here. And when our Legislature adopted the State Tort 

Claims Act, it did not vary from the exceptions then existing 

in the FTCA.

Addressing the assault and battery components of the exception in 1985, a plurality of the U.S. Supreme Court explained 

that “Congress passed the [FTCA] on the straightforward assurance that the United States would not be financially responsible 

for the assaults and batteries of its employees.”53

Two later contributions from the academy provide some 

guidance. A 2003 article concedes that the intentional torts 

48 Id.

49 Id.

50 Id. at 626. 

51 Developments in the Law - Remedies Against the United States and Its 

Officials, 70 Harv. L. Rev. 827, 891 (1957).

52 Id.

53 United States v. Shearer, 473 U.S. 52, 55, 105 S. Ct. 3039, 87 L. Ed. 2d 38 

(1985).
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exception was “intended to shield the government from unwieldy 

claims founded on intentional torts” and that “Congress’ intent 

with regard to intentional torts proximately caused by governmental negligence largely remains a mystery.”54 The most 

recent article explains that the FTCA’s exceptions “underscore 

the principle that the law does not provide a remedy for every 

wrong—particularly where the government is concerned.”55

According to the author:

The FTCA was enacted as one part of a broader 

legislative “housekeeping” measure—the Legislative 

Reorganization Act of 1946—whereby Congress removed 

from itself (or at least greatly reduced) certain timeconsuming administrative responsibilities. . . . One 

long-standing Congressional duty alleviated by the 

Reorganization Act was the consideration of “private 

bills,” which until that point had been essentially the only 

way for injured citizens to recover . . . for tortious conduct by government employees . . . .56

The author argues that by not using the term “intentional 

torts,” not including all intentional torts in the list of excluded 

causes of action, and excluding some torts that courts have 

held need not always be intentional, Congress “made clear 

its intent to exclude only a subset of intentional torts.”57

Addressing Congress’ rationale, the author reprises one, that 

“exposing the public fisc to potential liability . . . would be 

‘dangerous,’ based on the notion that these torts are both easy 

for plaintiffs to exaggerate and difficult to defend against.”58

54 Rebecca L. Andrews, So the Army Hired an Ax-Murderer: The Assault and 

Battery Exception to the Federal Tort Claims Act Does Not Bar Suits for 

Negligent Hiring, Retention and Supervision, 78 Wash. L. Rev. 161, 170 

(2003).

55 David W. Fuller, Intentional Torts and Other Exceptions to the Federal 

Tort Claims Act, 8 U. St. Thomas L.J. 375, 377 (2011).

56 Id. at 378.

57 Id. at 379.

58 Id. at 384.
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But the author also discerns two new rationales. He suggests that Congress “took a ‘wait and see’ or ‘step by step’ 

approach.”59 Finally, a “theme that emerges is the assumption 

that [excluded claims] could and would be ‘settled on the 

basis of private acts.’”60

From this exposition, a clear rationale emerges. Congress 

was willing to waive sovereign immunity where its employees acted negligently but not where they acted deliberately 

or recklessly—at least as to the specified torts. This is reminiscent of the intentional acts exclusion under a standard 

liability policy: an insurer is willing to insure against damages incurred in an accident, but it is against public policy to 

insure against liability for intentional actions.61 Declining to 

waive immunity for the specified intentional torts promotes 

high standards of performance by a sovereign’s employees 

and avoids “dangerous” exposure of the public treasury. This 

approach rejects relying solely on the claimant’s perspective 

(having been run over by a truck). We have examined the legislative history of the State Tort Claims Act and find nothing 

addressing the exceptions to the general waiver of sovereign 

immunity.62 Evidently, the Legislature was satisfied to rely 

upon Congress’ example.

Because waiver of sovereign immunity is a matter addressed 

solely to the Legislature and we are required to strictly construe the statute against a waiver, we would be acting beyond 

our power to do otherwise. Thus, in considering the arguments 

advanced by the parents, we must determine only whether 

59 Id.

60 Id. at 385.

61 See Austin v. State Farm Mut. Auto. Ins. Co., 261 Neb. 697, 625 N.W.2d 

213 (2001).

62 See, Introducer’s Statement of Purpose, L.B. 154, Judiciary Committee, 

80th Leg., 1st Sess. (Feb. 3, 1969); Minutes of Committee on Judiciary, 

L.B. 154, 80th Leg., 1st Sess. (Feb. 3, 1969); Committee Statement, L.B. 

154, Judiciary Committee, 80th Leg., 1st Sess. (Feb. 6, 1969); Floor 

Debate, L.B. 154, 80th Leg., 1st Sess. 840-43 (Mar. 26, 1969).
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immunity has clearly been waived. If there is any doubt, the 

State must prevail.

(e) Misrepresentation in 

Law of Torts

We concede that misrepresentation permeates the law of 

torts. It can be a separate tort or a method of accomplishing 

other torts.

Recognizing that misrepresentation can be a broad topic, a 

treatise limited the scope of its discussion. Its chapter on misrepresentation related to “the extent to which tort actions are 

available to protect intangible economic interests of those who 

are induced by mistake to enter into bargaining transactions as 

a consequence of a fraud of misrepresentation of others.”63 The 

treatise touched on the narrower tort of deceit:

The tort action of deceit is sometimes used as the name 

of the tort for covering all kinds of actions now available for all kinds of so-called actionable misrepresentations or nondisclosure. Sometimes that term is more 

narrowly used to cover the tort remedy that was available under the common law and prior to recent developments. But the more important question relates to the 

extent of liability on any theory for misrepresentations 

and nondisclosures. The reasons for the separate development of this action, and for its peculiar limitations, 

are in part historical, and in part connected with the 

fact that in the great majority of the cases which have 

come before the courts the misrepresentations have been 

made in the course of a bargaining transaction between 

the parties. Consequently, the action has been colored 

to a considerable extent by the ethics of bargaining 

between distrustful adversaries. Its separate recognition 

has been confined in practice very largely to the invasion of interests of a financial or commercial character, 

63 See W. Page Keeton et al., Prosser and Keeton on the Law of Torts § 105 

at 726 (5th ed. 1984).
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in the course of business dealings. There is no essential 

reason to prevent a deceit action from being maintained, 

for intentional misstatements at least, where other types 

of interests are invaded; and there are a few cases in 

which it has been held to lie for personal injuries, for 

tricking the plaintiff into an invalid marriage or marriage with one who is physically unfit, or for inducing 

the plaintiff to leave a husband, or to incur criminal 

penalties. In general, however, other theories of action 

have been sufficient to deal with non-pecuniary damage, 

and the somewhat narrower theory of deceit is not called 

into question.64

Case law has made clear that the misrepresentation exception applies to negligent misrepresentation as well as willful misrepresentation. Two U.S. Supreme Court cases, United 

States v. Neustadt65 and Block v. Neal,

66 so held under the 

FTCA. The Neustadt Court reasoned:

To say . . . that a claim arises out of “negligence,” 

rather than “misrepresentation,” when the loss suffered 

by the injured party is caused by the breach of a “specific 

duty” owed by the Government to him, i. e., the duty to 

use due care in obtaining and communicating information 

upon which that party may reasonably be expected to rely 

in the conduct of his economic affairs, is only to state 

the traditional and commonly understood legal definition 

of the tort of “negligent misrepresentation,” as is clearly, 

if not conclusively, shown by the authorities set forth in 

the margin, and which there is every reason to believe 

Congress had in mind when it placed the word “misrepresentation” before the word “deceit” in § 2680(h). 

As the Second Circuit observed . . . , “deceit” alone 

64 Id. (emphasis supplied).

65 United States v. Neustadt, 366 U.S. 696, 81 S. Ct. 1294, 6 L. Ed. 2d 614 

(1961).

66 Block v. Neal, 460 U.S. 289, 103 S. Ct. 1089, 75 L. Ed. 2d 67 (1983).
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would have been sufficient had Congress intended only to 

except deliberately false representations. Certainly there 

is no warrant for assuming that Congress was unaware 

of established tort definitions when it enacted the Tort 

Claims Act in 1946, after spending “some twenty-eight 

years of congressional drafting and redrafting, amendment and counter-amendment.” . . . Moreover, as we have 

said in considering other aspects of the Act: “There is 

nothing in the Tort Claims Act which shows that Congress 

intended to draw distinctions so finespun and capricious 

as to be almost incapable of being held in the mind for 

adequate formulation.”67

The Block Court declared that “the essence of an action 

for misrepresentation, whether negligent or intentional, is 

the communication of misinformation on which the recipient relies.”68

We have similarly held in a case construing the misrepresentation exception under the Political Subdivisions Tort 

Claims Act.69 In Stonacek v. City of Lincoln, homeowners 

built in an area near a tributary of a stream. After they experienced flooding in their new homes, they sued the city. Among 

other things, the complaint alleged that the city was negligent 

in failing to advise the homeowners of the Department of 

Natural Resources’ study which showed the flood elevation of 

the property was different from the elevation disclosed by the 

city. The city alleged that this was a claim for misrepresentation and that it had sovereign immunity because the Political 

Subdivisions Tort Claims Act excepted such a claim from 

the waiver of immunity.70 We employed the reasoning from 

Neustadt and explained:

67 United States v. Neustadt, supra note 65, 366 U.S. at 706-08 (citations 

omitted).

68 Block v. Neal, supra note 66, 460 U.S. at 296.

69 See Stonacek v. City of Lincoln, 279 Neb. 869, 782 N.W.2d 900 (2010).

70 See Neb. Rev. Stat. § 13-910(7) (Reissue 2012).
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In addressing the claims in Neustadt, the U.S. Supreme 

Court observed that the federal misrepresentation exception insulates the government against liability for conveying false or inaccurate information, whether that 

information was conveyed based on willfull or negligent misrepresentation. In determining that the [FTCA] 

excepts acts of misrepresentation, the Supreme Court 

defined negligent misrepresentation as the breach of “the 

duty to use due care in obtaining and communicating 

information upon which that party may reasonably be 

expected to rely in the conduct of his economic affairs.” 

. . . It has been observed that the “prophylaxis of 

the misrepresentation exception extends to failures of 

communication.”71

We determined that the homeowners’ claim was based on 

misrepresentation. We noted that the homeowners alleged the 

city had “failed to properly advise them of information.”72 But 

we held that the gravamen of the claim “involves the improper 

communicating of the flood plan information” and that, thus, 

“the claim [was] based on a misrepresentation.”73 Because 

the claim fell within the misrepresentation exception, we concluded that the claim was barred because sovereign immunity 

was not waived.

The reasoning of Stonacek is equally applicable to a claim 

implicating the misrepresentation exception under the State 

Tort Claims Act. The misrepresentation exception under 

§ 13-910(7) is identical to the misrepresentation exception 

contained in § 81-8,219(4).

Having provided a brief background concerning misrepresentation, we turn to the parents’ arguments.

71 Stonacek v. City of Lincoln, supra note 69, 279 Neb. at 883-84, 782 

N.W.2d at 911 (emphasis supplied).

72 Id. at 885, 782 N.W.2d at 912.

73 Id.
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(f) Parents’ Arguments

The parents assert that the district court erred in applying the 

misrepresentation exception for several reasons. We address 

each in turn.

(i) Application to Misrepresentation 

Involving Physical Injury

First, the parents claim that the traditional tort of misrepresentation requires some form of pecuniary loss and that the 

exception was designed to cover only that form of tort. The 

parents argue that because they did not plead any element of 

pecuniary loss, it was error to find their claim barred under 

the exception for misrepresentation or deceit. In essence, their 

argument is that Nebraska would not recognize a cause of 

action in tort for a conscious misrepresentation involving a risk 

of physical harm. We disagree.

Whether the misrepresentation exception applies where there 

is no commercial misrepresentation and the loss suffered is 

physical harm is a question of first impression in Nebraska. 

Our previous cases dealing with the exception all involved 

compensation for an economic loss.74 In Tolliver v. Visiting 

Nurse Assn.,

75 we stated: “[T]he distinct tort of fraud or misrepresentation is generally an economic tort against financial 

interests, asserted to recover pecuniary loss. One who makes a 

fraudulent or negligent misrepresentation in a business transaction is normally liable only for the recipient’s pecuniary 

losses.” Tolliver involved a claim for nonpecuniary and noneconomic loss (pain and suffering), but it did not concern the 

misrepresentation exception.

74 See, Zawaideh v. Nebraska Dept. of Health & Human Servs., supra note 

39; Doe v. Board of Regents, 280 Neb. 492, 788 N.W.2d 264 (2010); 

Stonacek v. City of Lincoln, supra note 69; Wickersham v. State, supra 

note 38.

75 Tolliver v. Visiting Nurse Assn., 278 Neb. 532, 539, 771 N.W.2d 908, 914-

15 (2009) (emphasis supplied).
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Tolliver does not foreclose the possibility of noneconomic 

damages in a tort action for misrepresentation. We note that 

our language, quoted above with our emphasis supplied, spoke 

in terms of generalities and not absolutes. And we provided 

two reasons why we did not believe permitting damages for 

pain and suffering was appropriate under a misrepresentation 

theory in that case. First, we recognized that all of the damages that the plaintiffs sought under their misrepresentation 

claims were alleged under its negligence claim. We cited a 

treatise to the effect that it was usually unnecessary to resort 

to a theory of deceit, because other theories of action were 

sufficient to deal with nonpecuniary loss.76 Second, we stated 

that a party may not have double recovery for a single injury. 

Although the plaintiffs did not specifically allege pain and suffering damages for their misrepresentation claims, we stated 

that such damages would have duplicated the pain and suffering damages claimed under the negligence cause of action. 

Thus, under the facts of Tolliver, it was not necessary for us to 

decide whether noneconomic damages would be available for 

a misrepresentation claim.

In Tolliver, we focused on two sections of the Restatement.77

Section 525 involves fraudulent misrepresentation that causes 

economic harm, and it is found in a chapter of the Restatement 

“concerned only with the liability for pecuniary loss resulting 

from misrepresentation or nondisclosure.”78 But the Restatement 

sets forth another type of fraudulent misrepresentation—one 

that causes physical harm.79 Tolliver did not mention § 310. We 

will discuss § 310 in more detail later in the analysis.

Because, as we have already explained, our State Tort 

Claims Act was modeled on the FTCA, we look to federal law 

76 See Keeton et al., supra note 63.

77 Restatement (Second) of Torts §§ 525 and 557A (1977).

78 Id., ch. 22, scope note at 55.

79 See Restatement (Second) of Torts § 310 (1965).
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for guidance. The federal courts, however, are not uniform in 

their application of the misrepresentation exception.

The two key U.S. Supreme Court cases dealing with the 

misrepresentation exception to the FTCA do not directly 

answer the question. Both Neustadt80 and Block81 involved 

economic damages in connection with the purchase of residential property.

Footnotes contained in the Neustadt and Block opinions 

have perhaps created confusion about the applicability of the 

misrepresentation exception to noncommercial situations. A 

footnote in Neustadt stated:

Our conclusion neither conflicts with nor impairs the 

authority of Indian Towing Co. v. United States, 350 

U. S. 61[, 76 S. Ct. 122, 100 L. Ed. 48 (1955)], which 

held cognizable a Torts Act claim for property damages 

suffered when a vessel ran aground as a result of the 

Coast Guard’s allegedly negligent failure to maintain 

the beacon lamp in a lighthouse. Such a claim does not 

“arise out of . . . misrepresentation,” any more than does 

one based upon a motor vehicle operator’s negligence 

in giving a misleading turn signal. As Dean Prosser has 

observed, many familiar forms of negligent conduct may 

be said to involve an element of “misrepresentation,” in 

the generic sense of that word, but “(s)o far as misrepresentation has been treated as giving rise in and of itself 

to a distinct cause of action in tort, it has been identified 

with the common law action of deceit,” and has been 

confined “very largely to the invasion of interests of a 

financial or commercial character, in the course of business dealings.”82

The Block Court, in discussing the above footnote from 

Neustadt, said the following in a footnote:

80 United States v. Neustadt, supra note 65.

81 Block v. Neal, supra note 66.

82 United States v. Neustadt, supra note 65, 366 U.S. at 711 n.26.
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The Court distinguished negligent misrepresentation 

from the “many familiar forms of negligent misconduct 

[which] may be said to involve an element of ‘misrepresentation,’ [only] in the generic sense of that word.” 

. . . The “misrepresentation” exception applies only when 

the action itself falls within the commonly understood 

definition of a misrepresentation claim, which “‘has 

been identified with the common law action of deceit,’ 

and has been confined ‘very largely to the invasion of 

interests of a financial or commercial character, in the 

course of business dealings.’” . . . Thus, the claim in 

Indian Towing Co. v. United States, 350 U. S. 61[, 76 

S. Ct. 122, 100 L. Ed. 48] (1955), for damages to a vessel which ran aground due to the Coast Guard’s alleged 

negligence in maintaining a lighthouse, did not “aris[e] 

out of . . . misrepresentation” within the meaning of 

§ 2680(h).83

These footnotes referencing Indian Towing Co. v. United 

States84 may have been an attempt to distinguish misrepresentation from operational negligence.

The lower federal courts have inconsistent results.

Two federal circuit courts have limited application of the 

misrepresentation exception to pecuniary or commercial misrepresentations. The 10th Circuit concluded that the misrepresentation exception to the FTCA did not apply to bar 

emotional distress claims.85 The court observed that pecuniary 

loss, which it called an “essential component[] of negligent 

misrepresentation,”86 was not present. The 11th Circuit determined that the misrepresentation exception applied in a case 

where the injury suffered “was the loss of . . . investment 

83 Block v. Neal, supra note 66, 460 U.S. at 296 n.5.

84 Indian Towing Co. v. United States, 350 U.S. 61, 76 S. Ct. 122, 100 L. Ed. 

48 (1955).

85 Estate of Trentadue ex rel. Aguilar v. U.S., 397 F.3d 840 (10th Cir. 2005).

86 Id. at 855.
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money, which is an economic injury arising from a commercial decision.”87 And some federal district courts noted 

the presence or absence of a commercial misrepresentation in 

either applying or declining to apply the exception.88

But two other circuit courts have contradictory aspects. 

In Kohn v. United States,

89 an action involving the claims 

of parents of a soldier who was killed by a fellow soldier, 

the Second Circuit briefly addressed the misrepresentation 

and deceit exceptions. The court stated: “[T]hese exceptions 

have generally been applied only to actions for damages due 

to commercial decisions that were predicated on incorrect 

or incomplete information. . . . Because the context here is 

hardly commercial in nature, we do not believe that appellants’ claims are necessarily barred as an action for misrepresentation or deceit.”90 But the Second Circuit later observed 

a limitation of Kohn: “Kohn stopped well short of holding 

that the United States had waived sovereign immunity for 

non-commercial torts arising from its suppression of information or its release of information that was fraudulent. Indeed, 

the panel in Kohn had no occasion to decide that question,”91

because the Second Circuit reversed and remanded to permit 

the appellants to amend their remaining cause of action to 

include new allegations. The Ninth Circuit first stated that 

87 Zelaya v. U.S., 781 F.3d 1315, 1338 (11th Cir. 2015).

88 See, e.g., Ard v. F.D.I.C., 770 F. Supp. 2d 1029 (C.D. Cal. 2011) (stating 

government is not liable for injuries resulting from commercial decisions 

made in reliance on government misrepresentations); Mill Creek Group, 

Inc. v. F.D.I.C., 136 F. Supp. 2d 36 (D. Conn. 2001) (observing that 

plaintiff sought to redress economic injury incurred in commercial setting); 

Salter v. U.S., 853 F. Supp. 389, 394 (M.D. Ala. 1994) (stating exception 

did not apply because plaintiff’s claim “is for personal injury, not for 

injury of a commercial or financial nature”).

89 Kohn v. United States, 680 F.2d 922 (2d Cir. 1982).

90 Id. at 926.

91 See Cabiri v. Government of Republic of Ghana, 165 F.3d 193, 201 (2d 

Cir. 1999).
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“the misrepresentation exception precludes liability where the 

plaintiff suffers economic loss as a result of a commercial 

decision which was based on a misrepresentation.”92 But it 

later stated, without any analysis, that the misrepresentation 

exception barred a claim by a juvenile who was sexually 

abused by a felon working at a foster home.93

Several federal district courts have explicitly stated that the 

exception is not limited to financial or commercial loss.94 In 

Najbar v. U.S.,

95 a Minnesota federal court addressed the footnote from Block that we quoted above:

Taken out of context, the quoted portions of Block and 

Neustadt could be read to support [plaintiff’s] assertion 

that, because she does not seek to recover for commercial 

injury, her claim is not barred by the FTCA’s misrepresentation exception even if it is a claim for misrepresentation. 

But the context makes clear that Block and Neustadt were 

simply describing, in elliptical fashion, the most-common 

types of misrepresentation claims. Indeed, the very language from Prosser’s treatise quoted in Neustadt and then 

in Block spoke of misrepresentation claims being “‘very 

largely’”—but not exclusively—limited to claims seeking recovery for commercial injury. . . . And Block itself 

said that “the essence of an action for misrepresentation, 

92 Green v. United States, 629 F.2d 581, 584 (9th Cir. 1980). See, also, Mt. 

Homes, Inc. v. U.S., 912 F.2d 352, 356 (9th Cir. 1990) (stating conclusion 

that misrepresentation exception precluded recovery was “buttressed by 

the fact that [plaintiff] suffered an economic injury in a commercial 

setting”). 

93 See Lawrence v. U.S., 340 F.3d 952 (9th Cir. 2003).

94 See, e.g., Najbar v. U.S., 723 F. Supp. 2d 1132 (D. Minn. 2010), affirmed 

on other grounds 649 F.3d 868 (8th Cir. 2011); Russ v. U.S., 129 F. Supp. 

2d 905 (M.D.N.C. 2001); Mullens v. U.S., 785 F. Supp. 216 (D. Maine 

1992); Wells v. U.S., 655 F. Supp. 715 (D.D.C. 1987); Diaz Castro v. 

United States, 451 F. Supp. 959 (D. Puerto Rico 1978); Lloyd v. Cessna 

Aircraft Co., 429 F. Supp. 181 (E.D. Tenn. 1977).

95 Najbar v. U.S., supra note 94, 723 F. Supp. 2d at 1137.
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whether negligent or intentional, is the communication of 

misinformation on which the recipient relies.” . . . This 

formulation of the “essence” of misrepresentation is not 

limited to commercial misrepresentations. Finally, neither 

Neustadt nor Block involved a claim for noncommercial 

misrepresentation, and thus neither case could have held 

that such claims were outside the scope of the FTCA’s 

misrepresentation exception.

The Minnesota federal court remarked that “Congress used 

the word ‘misrepresentation,’ and that word is broad enough 

to reach all types of claims for misrepresentation, whether 

those claims seek recovery for commercial injury, physical 

injury, or emotional injury.”96 A different court looked to a 

few cases that had applied the misrepresentation exception and 

concluded that “[c]learly the exception is just as applicable to 

actions involving personal injury and wrongful death as it is 

to those involving only financial or commercial loss, absent 

any indication that Congress intended such exception to apply 

only to the latter type of lawsuits.”97 Another court rejected the 

plaintiff’s argument that the misrepresentation exception had 

been limited to transactions of a commercial nature, observing that the Neustadt Court relied upon cases which were 

noncommercial.98

Some federal courts have applied the misrepresentation 

exception to claims involving nonpecuniary losses without elaboration. At least one federal court excluded a claim 

seeking damages for wrongful death.99 We observe that 

in some cases in which claims for personal injuries were 

barred, the claims appeared to arise out of a commercial 

96 Id.

97 Diaz Castro v. United States, supra note 94, 451 F. Supp. at 963.

98 Vaughn v. United States, 259 F. Supp. 286 (N.D. Miss. 1966).

99 See, e.g., Bartie v. United States, 216 F. Supp. 10 (W.D. La. 1963) (alleging 

government failed to give adequate warning concerning hurricane).
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transaction.100 And we note that the Seventh Circuit has stated 

that “[t]he test is not whether the injury was economic, but 

whether it resulted from a commercial decision based on a 

governmental misrepresentation.”101

Decisions from courts of two states deserve attention. 

First, California courts have found that its statutes102 do not 

insulate the government from liability when the suit did not 

involve commercial misrepresentations. In Johnson v. State 

of California,

103 foster parents sued after a child, who the 

state was aware had homicidal tendencies, was placed in their 

home without notice of any dangerous propensities. The court 

reasoned that “it would be at best anomalous, and at worst 

an inversion of accepted priorities, to allow the state immunity only upon a finding that the parole officer actually lied 

to plaintiff.”104

But this decision provides little guidance for several reasons, in increasing order of importance. Most of the decision 

focused on the discretionary function exception. California’s 

statute is considerably different from ours. California expansively shields state employees from individual liability, but 

100 See, e.g., Schneider v. USA, 936 F.2d 956 (7th Cir. 1991) (purchasers 

of defective prefabricated homes sued for personal injuries and property 

damages); Hamre v. United States, 799 F.2d 455 (8th Cir. 1986) (purchasers 

of home discovered to be infested with bats sued for personal injuries and 

property damages).

101Preston v. United States, 596 F.2d 232, 239 (7th Cir. 1979).

102 See Cal. Gov’t Code §§ 818.8 (“public entity is not liable for an injury 

caused by misrepresentation by an employee of the public entity, whether 

or not such misrepresentation be negligent or intentional”) and 822.2 

(“public employee acting in the scope of his employment is not liable 

for an injury caused by his misrepresentation, whether or not such 

misrepresentation be negligent or intentional, unless he is guilty of actual 

fraud, corruption or actual malice”) (West 2012).

103 Johnson v. State of California, 69 Cal. 2d 782, 447 P.2d 352, 73 Cal. Rptr. 

240 (1968).

104 Id. at 800, 447 P.2d at 364, 73 Cal. Rptr. at 252.
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our statute does so only where suit is permitted under the State 

Tort Claims Act.105 The California court relied heavily on state 

legislative history demonstrating a concern with misrepresentation in the area of state contracts. But, most important, the 

court does not follow a rule construing waivers of sovereign 

immunity strictly against waiver and in favor of the sovereign. 

The phrase “strict construction” does not appear anywhere 

in the decision. The court’s concern with an “inversion of 

accepted priorities” attacks the central premise of an intentional 

torts exception. From a moral standpoint, intentional torts are

more egregious than mere negligence. But the Legislature, and 

not the courts, is empowered to determine where immunity 

should be waived. We might not agree with the rationale for its 

distinction, but we must not usurp its role in drawing the line 

between liability and immunity. Because a California Court of 

Appeals decision106 is driven by the Johnson opinion, the same 

reasons dictate giving it little attention.

A decision of the Supreme Court of Alaska107 deserves more 

attention, because Alaska’s statute, like ours, was modeled on 

the FTCA. In the Alaska case, parents sued the state, alleging negligent failure to disclose information that would have 

alerted them to the risks of accepting into their home a foster 

child who ultimately physically and sexually assaulted their 

two children. The Supreme Court of Alaska reversed a summary judgment in favor of the state.

But despite the similarity of statutes, we do not find 

the Alaska decision to be persuasive. Most of the decision 

focused on foreseeability in the context of summary judgment. The court’s examination of federal cases was limited 

to the Neustadt footnote.108 The court relied heavily upon 

105 See § 81-8,217.

106 Michael J. v. L.A. Cty. D. of Adoptions, 201 Cal. App. 3d 859, 247 Cal. 

Rptr. 504 (1988).

107P.G. v. DFYS, 4 P.3d 326 (Alaska 2000).

108United States v. Neustadt, supra note 65.
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the California court’s reasoning in Johnson. Likewise, the 

Alaska court does not discuss “strict construction” and fails 

to discern the rationale that could induce a state legislature 

to retain sovereign immunity for some torts while waiving it 

for others.

Although we have not expressly adopted § 310 of the 

Restatement,109 it is persuasive authority that a cause of action 

would lie for a conscious misrepresentation involving risk of 

physical harm. It states:

An actor who makes a misrepresentation is subject to 

liability to another for physical harm which results from 

an act done by the other or a third person in reliance upon 

the truth of the representation, if the actor

(a) intends his statement to induce or should realize 

that it is likely to induce action by the other, or a third 

person, which involves an unreasonable risk of physical 

harm to the other, and

(b) knows

(i) that the statement is false, or

(ii) that he has not the knowledge which he professes.110

This section fits the facts determined by the district court. Gall 

was the “actor who ma[de] a misrepresentation.” The parents 

were the “third person[s].” Their child was the “other.” Thus, 

Gall is subject to liability to the parents’ child which resulted 

from the act done by the parents (taking K.D.M. into their 

home) in reliance upon the truth of the representation, because 

Gall intended to induce the parents, or should have realized 

that her misrepresentation was likely to induce action by the 

parents, which involved an unreasonable risk of physical harm 

to the parents’ child, and Gall knew that the statement was 

false. This section is found in a division of the Restatement 

on negligence, so it is no surprise a comment stated that the 

liability in § 310 “is negligence liability and is enforced in an 

109Restatement, supra note 79.

110 Id. at 103.
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ordinary negligence action.”111 What is important is that § 310 

is located in a section of the Restatement that is not limited to 

commercial or business transactions and expressly extends to 

liability for physical harm.

[14] We agree with those courts finding that the misrepresentation exception can apply to claims for personal injuries as 

well as economic injuries and to claims not involving business 

transactions. We are persuaded by the reasoning of Najbar v. 

U.S.112 As that court observed, while the U.S. Supreme Court 

has explicitly recognized that the misrepresentation exception 

would arise most often in the course of business transactions,113

the Court has not declared that the exception is applicable only 

in the commercial context. And § 310 of the Restatement provides persuasive authority that conscious misrepresentation 

can be the basis for liability for physical harm.

[15] The doctrine of strict construction supports our conclusion that the misrepresentation exception applies in a case 

such as this one. As we explained earlier, statutes purporting 

to waive the protection of sovereign immunity of the State or 

its subdivisions are strictly construed in favor of the sovereign 

and against the waiver, and a waiver of sovereign immunity 

is found only where stated by the most express language of 

a statute or by such overwhelming implication from the text 

as will allow no other reasonable construction.114 Thus, the 

misrepresentation exception must be strictly construed in favor 

of the government.115 In doing so, we cannot eliminate its 

application to a claim—the “essence” of which “is the communication of misinformation on which the recipient relies”116—

merely because the claim does not involve pecuniary loss or 

111 Restatement, supra note 77, § 557A, comment a. at 149.

112Najbar v. U.S., supra note 94.

113 See United States v. Neustadt, supra note 65.

114 See Lamb v. Fraternal Order of Police Lodge No. 36, supra note 31.

115 See Zelaya v. U.S., supra note 87.

116 Block v. Neal, supra note 66, 460 U.S. at 296.
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a financial transaction. If the Legislature wishes to expand 

the scope of the State’s liability by limiting application of the 

misrepresentation exception to claims arising from commercial 

transactions or which involve only pecuniary losses, it has the 

power to amend the statute accordingly.

(ii) Gravamen of Complaint Test

Next, the parents contend that the gravamen of the complaint 

test is inapplicable. In arguing that the test is not appropriate 

in a case for personal injury, the parents repeat their contention 

that misrepresentation as a tort involves pecuniary or commercial loss only. Again, we disagree.

The gravamen of the parents’ allegations of negligence was 

the communication of misinformation. Had the State, through 

Gall, not provided the parents with false information, the 

parents’ child would not have been harmed (because either 

they would not have accepted K.D.M. in their home or they 

would have implemented appropriate safeguards). Under the 

reasoning of Stonacek,

117 it is immaterial whether Gall negligently failed to disclose or warn of K.D.M.’s sexual history 

or whether Gall intentionally concealed that sexual history. In 

Stonacek, we held that a claim for failure to communicate relevant information was barred by the misrepresentation exception. Here, the parents’ allegations of “failure to warn” and 

“failure to disclose” essentially assert a failure to communicate 

critical information. And as in Stonacek, those claims, no matter how pled, are claims of misrepresentation. This is not a 

case where the cause of action only collaterally involves a 

misrepresentation; rather, the cause of action arises out of and 

is grounded on misrepresentation.

(iii) Independent Operational 

Duty to Disclose

The parents argue that it was error to find their claim barred 

by the misrepresentation exception, because they assert that 

117 Stonacek v. City of Lincoln, supra note 69.
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the State had an independent operational duty to disclose 

K.D.M.’s sexual history. A governmental entity “‘is liable for 

injuries resulting from negligence in performance of operational tasks even though misrepresentations are collaterally 

involved.’”118 But again, we look to Stonacek and the gravamen of the complaint.

In Stonacek, we addressed whether the failure to disclose 

could fall outside the misrepresentation exception because it 

alleged negligent performance of operational tasks. In doing 

so, we cited and discussed the decisions in Neustadt and 

Block. In Neustadt, the plaintiff claimed it suffered money 

damages as a result of an erroneous appraisal conducted by a 

government agency. The U.S. Supreme Court found the erroneous appraisal was a misrepresentation, and thus, the claim 

was barred by sovereign immunity. In Block, the plaintiff 

alleged it suffered money damages when a government agency 

breached a duty to supervise construction of a new home. The 

Block Court noted that although part of the theory was that the 

government agency failed to communicate information about 

the construction, the plaintiff also alleged the agency had a 

separate duty to act by supervising the construction. Because 

it was the failure to supervise that caused the harm, the Block

Court concluded the claim was not barred by the misrepresentation exception.

Where the gravamen of the complaint is negligent performance of operational tasks rather than misrepresentation, 

the State cannot rely upon the misrepresentation exception 

in the State Tort Claims Act.119 The misrepresentation exception “does not bar negligence actions which focus not on the 

Government’s failure to use due care in communicating information, but rather on the Government’s breach of a different 

duty.”120 But to avoid dismissal based on the misrepresentation 

118 Zelaya v. U.S., supra note 87, 781 F.3d at 1336.

119 Stonacek v. City of Lincoln, supra note 69.

120Block v. Neal, supra note 66, 460 U.S. at 297.
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exception, a plaintiff must allege injury independent of that 

caused by the erroneous information.121

Even though the State had a duty to warn of K.D.M.’s 

sexual history, the facts of this case fall within the misrepresentation exception. As Neustadt, Block, and Stonacek make 

clear, to fall outside the scope of the misrepresentation exception, the question is not whether the government had an independent duty to take action; rather, the question is whether 

the duty on which a plaintiff bases his or her claim is a duty 

separate and apart from the duty to disclose information. Here, 

the complaint alleged that Jill “inquired whether there was 

anything sexual in [K.D.M.’s] record, [and] Gall stated ‘no.’” 

The parents claim that Gall “knew or should have known 

of [K.D.M.’s record of sexual abuse] but refused to disclose 

such information.” Their complaint focuses on the failure to 

disclose the information, but the essence of the claim is the 

breach of a duty not to miscommunicate. And they have not 

alleged injury independent of that caused by the erroneous 

information. Any operational duty to disclose information or 

to warn the parents about K.D.M.’s sexual history is subsumed 

by the misrepresentation exception.

The parents rely upon our decision in Fuhrman v. State,

122

arguing that both cases rest on the complete failure to convey information. In Fuhrman, the Department of Health and 

Human Services was aware that one of its wards had a history 

of physical violence against his caregivers and others. But a 

department employee did not tell anyone at the hospital where 

the ward was taken about the ward’s violent history or that 

the ward was likely to target female staff members. At the 

hospital, the ward attacked a female psychiatric technician. 

The technician sued, claiming that appellants were negligent in 

failing to disclose to the hospital and its employees information regarding the ward’s assaultive behavior. Near the close 

121 See Stonacek v. City of Lincoln, supra note 69.

122Fuhrman v. State, supra note 4.
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of trial, appellants moved for leave to amend their answer to 

include affirmative defenses of sovereign and qualified immunity, based on their understanding that the technician was 

asserting that appellants had misrepresented the ward’s medical 

history. The district court denied the motion, and we found no 

abuse of discretion.

Fuhrman is distinguishable. The affirmative defense of sovereign immunity was not pled in an answer prior to trial. 

We considered it only in the context of whether the trial 

court abused its discretion in denying a motion to amend the 

answer—made near the end of trial—to include the defense. 

Here, the State asserted the defense in its operative answer.

[16] Further, Fuhrman contains language that is irreconcilable with Stonacek. In Fuhrman, we stated that “neither 

[the technician’s] theory of the case nor her evidence was 

based on misrepresentation, but, rather, on a complete failure 

to convey the critical information, without an inference that 

this was deliberately done.”123 We noted that the trial court’s 

decision was “based on failure to disclose information.”124

However, Stonacek clearly holds that an allegation of failure 

to advise was a claim based on misrepresentation. Our opinion 

in Stonacek did not discuss or cite Fuhrman, but the two cases 

are in conflict. Because we are persuaded by the reasoning of 

Stonacek, we expressly disapprove of Fuhrman to the extent it 

holds that “a complete failure to convey the critical information, without an inference that this was deliberately done,”125

falls outside the misrepresentation exception.

[17] No matter how the parents try to frame their complaint, their claim arises out of a misrepresentation. As the 

11th Circuit has stated: “‘It is the substance of the claim and 

not the language used in stating it which controls’ whether the 

claim is barred by an FTCA exception. . . . Thus, a plaintiff 

123 Id. at 183, 655 N.W.2d at 873. 

124 Id.

125 Id.
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cannot circumvent the misrepresentation exception simply 

through artful pleading of its claims.”126 Gall’s misstatement 

is essential to the parents’ claim. Although they frame their 

claim as a negligence action, the basis for it is Gall’s underlying misrepresentation.

(iv) Public Policy

The parents assert that the State should not be immune 

from liability for failing to properly disclose the history of an 

adoptee to potential parents as a matter of public policy. But 

such policy judgments are properly within the province of 

the Legislature, not this court.

4. Negligent Supervision

The parents argue that the district court erred in failing to 

find the State liable for negligent supervision. They contend 

that the evidence clearly established that Gall was overworked and that her supervisor was responsible for Gall’s 

workload.

Recasting an excepted tort claim as a negligence claim 

does not avoid the bar of immunity. In Johnson v. State,

127 we 

determined that a negligence claim asserting failure to supervise, hire, and discipline was barred because it arose out of 

assault and battery. In that case, we adopted the reasoning of 

four of the eight participating justices in a U.S. Supreme Court 

case,128 who stated:

“[The plaintiff] cannot avoid the reach of § 2680(h) 

by framing her complaint in terms of negligent failure 

to prevent the assault and battery. Section 2680(h) does 

not merely bar claims for assault or battery; in sweeping 

language it excludes any claim arising out of assault or 

battery. We read this provision to cover claims like [the 

126 JBP Acquistions, LP v. U.S. ex rel. F.D.I.C., 224 F.3d 1260, 1264 (11th Cir. 

2000).

127 Johnson v. State, supra note 15.

128United States v. Shearer, supra note 53.
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plaintiff’s] that sound in negligence but stem from a battery committed by a Government employee.”129

We also agreed with a justice’s concurrence in a different U.S. 

Supreme Court case:

“To determine whether a claim arises from an intentional 

assault or battery and is therefore barred by the exception, 

a court must ascertain whether the alleged negligence was 

the breach of a duty to select or supervise the employeetortfeasor or the breach of some separate duty independent from the employment relation. . . . If the allegation 

is that the Government was negligent in the supervision 

or selection of the employee and that the intentional tort 

occurred as a result, the intentional tort exception . . . 

bars the claim. Otherwise, litigants could avoid the substance of the exception because it is likely that many, if 

not all, intentional torts of Government employees plausibly could be ascribed to the negligence of the tortfeasor’s 

supervisors. To allow such claims would frustrate the 

purposes of the exception.”130

The same principle applies here. The parents’ negligent 

supervision claim is barred, because it arises out of misrepresentation. Any alleged negligence was inextricably linked to 

the misrepresentation. The district court did not err by failing 

to find the State liable for negligent supervision, because this 

claim was also barred by the State Tort Claims Act.

VI. CONCLUSION

The Legislature may wish to consider whether the rationale 

underlying the intentional torts exception, at least as to misrepresentation and deceit, continues to justify preservation of 

the State’s sovereign immunity. From the perspective of the 

129 Johnson v. State, supra note 15, 270 Neb. at 320, 700 N.W.2d at 624 

(emphasis in original).

130 Id. at 322, 700 N.W.2d at 625, quoting Sheridan v. United States, 487 U.S. 

392, 108 S. Ct. 2449, 101 L. Ed. 2d 352 (1988) (Kennedy, J., concurring 

in judgment).
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parents, immunity “adds insult to injury.” Their child was the 

one, so to speak, “run over by the truck.” And it may well 

be that time has demonstrated that Congress’ fears—of the 

difficulty of defending such suits and the probability of judgments against the government in amounts out of proportion 

to the damages actually suffered by claimants—have proved 

unfounded. It may be time for the “next step” envisioned by 

the commentator. But it is absolutely clear that those questions 

are properly addressed to the Legislature and not to us. And 

we express no opinion whether the parents have any avenue to 

compensation through legislative action.

We must strictly construe the misrepresentation exception 

to the waiver of sovereign immunity in favor of the State and 

conclude that so construed, it cannot be definitively limited to 

claims involving pecuniary losses.

Because the parents’ claims arise out of Gall’s misrepresentation, they are barred. We affirm the judgment of the district court.

Affirmed.