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THE SUPREME COURT OF THE STATE OF ALASKA 

GRANT MILLER and WHITING

HARBOR AQUAFARM LLC, 

Appellants, 

v. 

STATE OF ALASKA, DEPARTMENT

OF ENVIRONMENTAL 

CONSERVATION, 

Appellee. 

 

 

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) Supreme Court No. S-15370 

Superior Court No. 1SI-11-00138 CI 

O P I N I O N 

No. 7021 – July 24, 2015 

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Appeal from the Superior Court of the State of Alaska, First 

Judicial District, Sitka, David V. George, Judge. 

Appearances: Teka K. Lamade, Sitka, for Appellants. David 

T. Jones, Senior Assistant Attorney General, Anchorage, and 

Craig W. Richards, Attorney General, Juneau, for Appellee. 

Before: Fabe, Chief Justice, Winfree, Stowers, Maassen, and 

Bolger, Justices. 

BOLGER, Justice. 

I. INTRODUCTION 

An oyster farmer closed his farm after dozens of people became sick from 

eating his oysters. He sued a state agency, alleging that the agency negligently informed 

him that the site of his farm was suitable for shellfish farming. The superior court 

granted summary judgment for the agency, concluding that the farmer’s 
 

 

 

 

 

 

 

 

 

misrepresentation claim was barred by state sovereign immunity. The farmer argues that 

the agency’s sovereign immunity defense was inapplicable because his complaint alleged 

a claim of negligence, not negligent misrepresentation. But the allegations in the 

farmer’s complaint supported only a negligent misrepresentation claim. We affirm. 

II. FACTS AND PROCEEDINGS 

In 1996 the Department of Environmental Conservation (the Department) 

approved an area in Whiting Harbor for shellfish farming. In 2000 Grant Miller applied 

for a permit to operate an oyster farm in that area, and the Department granted his 

application. In 2009 dozens of people became sick after eating oysters from Miller’s 

oyster farm, and Miller shut down the farm. 

In 2011 Miller filed a complaint against the Department, alleging that it had 

conducted its 1996 studies in a negligent manner and “held out Whiting Harbor as an 

approved site for oyster farming.” He further alleged that he had relied on the 

Department’s approval of the site for shellfish farming when he sought and obtained a 

permit, and that his reliance was a proximate cause of his oyster farm’s failure. Miller 

later amended his complaint to add the City of Sitka as a defendant, add Whiting Harbor 

Aquafarm LLC (his business) as a plaintiff, and allege that the Department was aware 

of the presence of the invasive species tunicate in the area at the time it granted his 

permit. 

The Department moved for summary judgment, arguing that Miller’s 

amended complaint alleged only a single claim, misrepresentation, which was barred by 

state sovereign immunity. 1 Miller opposed this motion, arguing that his claim was one 

of negligence, not misrepresentation. The superior court granted the Department’s 

summary judgment motion. 

See AS 09.50.250(3). 

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Miller appeals. 

III. STANDARD OF REVIEW 

“We review rulings on motions for summary judgment de novo. When 

applying the de novo standard of review, we apply our independent judgment to 

questions of law, adopting the rule of law most persuasive in light of precedent, reason, 

and policy.”2 

IV. DISCUSSION 

In accordance with article II, section 21 of the Alaska Constitution, 

AS 09.50.250 allows “[a] person or corporation having a . . . tort claim against the state 

[to] bring an action against the state . . . .” This waiver of state sovereign immunity is 

not unlimited, and AS 09.50.250(3) explicitly states that “an action may not be brought 

if the claim . . . arises out of . . . misrepresentation.” The tort of negligent 

misrepresentation has four essential elements: 

(1) the party accused of misrepresentation must have made 

the statement in the course of his business, profession or 

employment; (2) the representation must supply “false 

information”; (3) the plaintiff must show “justifiable 

reliance” on the false information; and (4) the accused party 

must have failed “to exercise reasonable care or competence 

[ ] in obtaining or communicating the information.” 3

Miller’s allegations against the Department, in both his original and 

amended complaints, constitute a straightforward claim of negligent misrepresentation. 

First, Miller alleged that the Department “held out Whiting Harbor as an approved site 

2 Bush v. Elkins, 342 P.3d 1245, 1251 (Alaska 2015) (quoting 

ConocoPhillips Alaska, Inc. v. Williams Alaska Petroleum, Inc., 322 P.3d 114, 122 

(Alaska 2014)) (internal quotation marks omitted). 

3 Willard v. Khotol Servs. Corp., 171 P.3d 108, 118-19 (Alaska 2007) 

(quoting RESTATEMENT (SECOND) OF TORTS § 552(1) (1977)). 

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for oyster farming” as part of its “duty to conduct [suitability] studies in compliance with 

the State’s . . . policies and procedures.” Second, he alleged that the State’s assurance 

of the site’s suitability for oyster farming was false. Third, he alleged that he “actually 

and reasonably relied” on this assurance. And fourth, he alleged that the Department was 

negligent in conducting its suitability studies. Under AS 09.50.250(3), the Department 

is immune from liability for this alleged misrepresentation. 

Miller argues that he subsequently introduced, in an affidavit supporting his 

opposition to summary judgment, evidence of material facts that demonstrate that his 

claim was one of negligence, not negligent misrepresentation. Namely, he claims that 

he submitted evidence demonstrating that the Department “remained involved with ongoing inspections aimed at establishing a duty of care with regard to public health[,] . . 

. fail[ed] to . . . enforce the terms of the [nearby] Wastewater Treatment Plant’s permit[,] 

. . . [and] failed to respond appropriately in light of its knowledge of flow rates at the 

[Treatment Plant] and its ability to regulate that flow.” Miller claims these negligent acts 

“placed an unreasonable risk not only on Mr. Miller, but on the public generally.” 

But we do not need to decide whether this evidence would support an 

independent negligence claim, because neither Miller’s original nor amended complaint 

made allegations encompassing this evidence. The only injury Miller claimed was 

detrimental reliance on the Department’s assurance that the site was suitable for shellfish 

farming. This reliance was an element of Miller’s misrepresentation claim; it did not 

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support an independent negligence claim.4 And Miller never amended his complaint to 

allege an injury other than detrimental reliance. 

Finally, Miller cites several federal cases where courts have allowed 

negligence claims against government agencies to proceed “even though 

misrepresentations [were] collaterally involved.”5 But in each of these cases, 

government officials acted, or failed to act, in ways that caused injuries to the plaintiffs 

that were separate and apart from any misrepresentation. 

In Block v. Neal a government official visited a construction site three times 

and wrote inspection reports that failed to indicate defects in the project.6 The district 

court originally dismissed the case,7

 but the Sixth Circuit reversed, concluding that the 

Federal Tort Claims Act’s misrepresentation exception8

 did not bar the homeowner’s 

claim.9 The U.S. Supreme Court affirmed.10 Reasoning that the official “may have 

4 See JBP Acquisitions, LP v. U.S. ex rel. FDIC, 224 F.3d 1260, 1264 (11th 

Cir. 2000) (“The test in applying the misrepresentation exception [to the Tort Claims 

Act] is whether the essence of the claim involves the government’s failure to use due 

care in obtaining and communicating information. The exception covers actions for 

negligence when the basis for the negligence action is an underlying claim for 

misrepresentation.” (citations omitted)). 

5 See Block v. Neal, 460 U.S. 289 (1983); Nat’l Carriers, Inc. v. United 

States, 755 F.2d 675 (8th Cir. 1985); Guild v. United States, 685 F.2d 324 (9th Cir. 

1982). 

6 460 U.S. at 292. 

7 Id. 

8 28 U.S.C. § 2680(h) (2012). 

9 460 U.S. at 293-94. 

10 Id. at 294. 

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undertaken both to supervise construction of [the] house and to provide [the homeowner] 

information regarding the progress of construction,” the Court held that the 

misrepresentation exception would not bar a claim stemming from the official’s 

negligence in supervising the project.11 

In National Carriers, Inc. v. United States a government meat inspector 

undertook the tasks of identifying and separating exposed and unexposed meat at an 

accident site, but he negligently performed these duties.12 He also informed the salvage 

crew that the exposed and unexposed meat was “all the same.”13 Although the district 

court concluded that the misrepresentation exception shielded the government from 

liability, the Eighth Circuit reversed, holding that the inspector “acted negligently [in his 

inspection and separation duties], in a manner distinct from his misrepresentations.”14 

And in Guild v. United States a federal agency “surveyed possible [dam] 

sites, performed foundation analyses, . . . prepared a topographic survey, . . . 

recommended a site for [a] dam and reservoir, . . . design[ed] . . . the dam and reservoir[,] 

and prepared construction plans and specifications.”15 After the dam failed due to faulty 

design, the district court granted summary judgment for the government, concluding that 

the misrepresentation exception barred the suit.16 The Ninth Circuit reversed, holding 

11 Id. at 298-99. The homeowner did not allege negligent misrepresentation. 

Id. 

12 755 F.2d 675, 675-77 (8th Cir. 1985). 

13 Id. at 676 (internal quotation marks omitted). 

14 Id. at 677. 

15 685 F.2d 324, 324 (9th Cir. 1982). 

16 Id. at 325. 

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that “[d]esigning the dam and reservoir was an operational task and the [g]overnment 

performed it negligently. Any communication of misinformation was collateral.”17 

In contrast to these cases, Miller’s misrepresentation claim was not 

collateral to an independent claim of negligence — it was the only claim he alleged in 

his complaint. Because the Department is immune from liability for misrepresentation, 

the superior court’s summary judgment ruling was appropriate. 

V. CONCLUSION 

We AFFIRM the judgment of the superior court. 

Id. at 326. 

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