Opinion ID: 2516648
Heading Depth: 3
Heading Rank: 3

Heading: Dismissed Claims Against Governmental Defendants Sovereign Immunity

Text: {9} The district court held that claims against the State, Robert Perry, the City of Espanola, and Rio Arriba County for unjust enrichment (Count III), economic compulsion (Count IV), and constructive fraud (Count V) were barred by the New Mexico Tort Claims Act, NMSA 1978, §§ 41-4-1 to -27 (1976, as amended through 2001) (hereinafter TCA). Under the TCA, government entities are immune from tort liability unless immunity is specifically waived by the Act. NMSA 1978, § 41-4-4(A) (2001); Redding v. City of Truth or Consequences, 102 N.M. 226, 227, 693 P.2d 594, 595 (Ct.App.1984). Economic compulsion cases lend themselves most readily to the tort analytical framework (duty, breach of duty, causation and damages.) Terrel v. Duke City Lumber Co., 86 N.M. 405, 422, 524 P.2d 1021, 1038 (Ct.App.1974). Because economic compulsion cases lend themselves to a tort analysis, governmental entities may only be sued under this cause of action if immunity is waived by the TCA. As for constructive fraud cases, the Court of Appeals has held that constructive fraud is an activity for which sovereign immunity must be abrogated by one of the provisions of the Tort Claims Act. Health Plus Inc. v. Harrell, 1998-NMCA-064, ¶ 17, 125 N.M. 189, 958 P.2d 1239. The TCA does not specifically waive liability for economic compulsion or constructive fraud. See NMSA 1978, § 41-4-13 to -25 (1976, as amended through 2001). Because Plaintiffs' economic compulsion and constructive fraud claims have not specifically been waived by the TCA, the government cannot be sued for these causes of actions. Therefore, these claims were properly dismissed by the district court. {10} Plaintiffs' unjust enrichment (Count III) claim is more appropriately dismissed under NMSA 1978, § 37-1-23 (1976) (granting governmental entities immunity for actions based on contract, except for actions based on a valid written contract). The district court held that under Hydro Conduit Corp. v. Kemble, 110 N.M. 173, 179, 793 P.2d 855, 861 (1990), claims against governmental Defendants for unjust enrichment were barred by contractual immunity. In Hydro, we determined that a claim for unjust enrichment is an action closely related to an action based in contract for purposes of Section 37-1-23 and that Section 37-1-23 should be construed to extend governmental immunity to unjust enrichment claims. Id. Because Hydro specifically extends governmental immunity to unjust enrichment claims, the state and county Defendants in the present matter cannot be sued for unjust enrichment. Therefore, Plaintiffs' unjust enrichment claim was appropriately dismissed by the district court.
{11} State, county, and city Defendants argued that Plaintiffs' separation of powers by unlawful taxation (Count VII), unlawful special tax (Count VIII), and unlawful taking (Count IX) claims failed to state a valid claim and were barred under the TCA. [2] In granting governmental Defendants' motions to dismiss, the district court concluded that Plaintiffs failed to state a claim because the facts alleged did not show that a tax had been imposed. We have previously stated that [a] rate charged for a public utility service or product is not a tax, but a price at which and for which the public utility service or product is sold[.] Apodaca v. Wilson, 86 N.M. 516, 525, 525 P.2d 876, 885 (1974) (quoted material and citations omitted). In the present matter, Plaintiffs voluntarily accepted collect call services. We do not consider payment for these voluntary services to be a mandatory tax. Because there is no tax involved in the present matter, Plaintiffs' claims for separation of powers by unlawful taxation and unlawful special tax fail to state a claim and were appropriately dismissed by the district court. {12} In Counts VII and VIII, Plaintiffs also argued that the rates charged by the private companies were taxes and such taxation violated the New Mexico Constitution. Even if this had been so, it is well established that absent a waiver of immunity under the Tort Claims Act, a person may not sue the state for damages for violation of a state constitutional right. Ford v. Dep't of Pub. Safety, 119 N.M. 405, 412, 891 P.2d 546, 553 (Ct.App.1994). As discussed earlier, in order for a plaintiff to sue a governmental entity, the cause of action must fit within one of the exceptions under the TCA. See § 41-4-4(A); Redding, 102 N.M. at 227, 693 P.2d at 595. There is nothing in the TCA waiving government immunity for Plaintiff's separation of powers for unlawful taxation and unlawful special tax claims. See §§ 41-4-13 to -25. Because the TCA has not waived immunity for Defendants' conduct, we agree with the district court that Counts VII and VIII were properly dismissed.