Court Opinion

ID: 3185977
Source: CourtListenerOpinion
Date Created: 2016-03-16 17:39:03.378077+00
Date Added: 2024-06-11T14:36:06.995477
License: Public Domain

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

SHANNON C. ADAMSON and
NICHOLAS ADAMSON, husband and                  No. 72925-0-
wife,
              Plaintiffs,                      DIVISION ONE

                                               PUBLISHED OPINION

PORT OF BELLINGHAM, a Washington
municipal corporation,

                    Defendant.

PORT OF BELLINGHAM, a Washington
municipal corporation,

                    Appellant,

             v.

STATE OF ALASKA, by and through
its DEPARTMENT OF
TRANSPORTATION AND PUBLIC
FACILITIES - ALASKA MARINE
HIGHWAY SYSTEM,
                                               FILED: March 14, 2016
                    Respondent.

      Trickey, J. —The Port of Bellingham and the state of Alaska, through the

Alaska Manne Highway System (AMHS), agreed to a lease in 2009 regarding
AMHS ferries using the Port of Bellingham's terminal. When an AMHS employee
sued the Port of Bellingham for negligently causing injuries to her while working
for AMHS, the Port impleaded Alaska based on provisions in the lease. But

Alaska, by statute, retains sovereign immunity for any claim that arises out of an
injury to a state-employed seaman.
No. 72925-0-1 / 2

       Alaska argues that the Port's claims fall within Alaska's sovereign immunity,

which AMHS officials did not have authority to relinquish. The Port maintains that

Alaska's sovereign immunity does not apply to third-party suits.         The Port's

argument contradicts the Alaska statute's plain language. Accordingly, AMHS's

act of agreeing to the lease exceeded its authority and is ultra vires. Thus, the

Port cannot enforce its claims against Alaska. We affirm the trial court's dismissal

of the Port's claims.1

                                       FACTS

       In 1988, the Port of Bellingham and the state of Alaska, through AMHS,

signed a 20-year lease to allow Alaska to use the Port's terminal forAMHS ferries.

The parties executed a new lease in 2009, agreeing that Washington law would

govern its construction, validity, performance, and enforcement. The parties also

included a provision for the allocation of fault between Alaska and the Port:

       Section 6.1 - Allocation of Fault: In the event a third-party asserts a
       claim for damages against either Lessor or the state in connection
       with this lease, the parties agree that either may take those steps
       necessary for the fact finder to make an allocation of comparative
       fault between Lessor and the state, in which case the party's liability
       to the claimant or the other party, if any, will not exceed its
       proportionate degree of fault.[2]
       In 2012, there was an accident involving the passenger ramp connecting

the pierto the ferry. The accident injured Shannon Adamson, an AMHS employee
who was operating the ramp at the time. Alaska compensated Adamson in
accordance with its workers' compensation program. Adamson sued the Port for

1 The Port moved to strike portions of Alaska's supplemental response brief. We deny
that motion.
2 Clerk's Papers (CP) at 50-51.
                                           2
No. 72925-0-1 / 3

additional damages under a negligence theory. The Port, in turn, impleaded

Alaska as a third-party defendant.

      The Port alleged five causes of action against Alaska, including negligence

under Washington law, negligence under general maritime law, breach of contract,

right to allocation offault under the lease, and general maritime indemnity. Alaska

brought a CR 12(b)(6) motion to dismiss the Port's claims. The trial court granted
Alaska's motion. The Port moved for reconsideration or clarification, which the

court denied. The Port appeals.

                                     ANALYSIS

       The Port appeals the trial court's dismissal of its third-party plaintiff claims
against Alaska for failure "to state a claim upon which relief can be granted." CR
12(b)(6). Although the trial court considered documents outside the pleadings, in
this case the "basic operative facts are undisputed and the core issue[s] [are]
one[s] of law," so we review the trial court's dismissal under the standards for a
motion to dismiss. Ortblad v. State, 85 Wn.2d 109, 111, 530 P.2d 635 (1975).

Dismissal under this standard is appropriate only "if it appears beyond doubt that

the plaintiff cannot prove any set offacts" that would justify recovery. Tenore v.
AT&T Wireless Servs., 136 Wn.2d 322, 330, 962 P.2d 104 (1998). We review CR

12(b)(6) motions de novo. Tenore. 136 Wn.2d at 329-30.
       The Port also appeals the trial court's denial of its motion for
reconsideration, but we need not consider that separately. We review motions for
reconsideration for an abuse of discretion. West v. Deo't of Licensing, 182 Wn.

App. 500, 516, 331 P.3d 72 (2014), review denied. 339 P.3d 634 (Wash. 2014).
No. 72925-0-1 / 4

Because we "can sustain the trial court's judgment upon any theory established by

the pleadings and supported by the proof," itwould be impossible for this court to

both affirm the trial court's motion to dismiss and hold that the trial court's denial

of reconsideration was an abuse of discretion. LaMon v. Butler. 112 Wn.2d 193,

200-01, 770 P.2d 1027 (1989). If we reversed the trial court's motion to dismiss,

the appeal of the motion for reconsideration would be moot. Wood v. Battle
Ground Sch. Dist.. 107 Wn. App. 550, 574, 27 P.3d 1208 (2001).

                                   Contract Claims

       The Port claims that the allocation of fault provision in its lease obligates

Alaska to compensate it for Adamson's injuries. Alaska disputes this interpretation
ofthe lease. But it also argues that, to the extentthe lease subjectsAlaska to suits
for claims arising out of injuries to state-employed seamen, it is ultra vires and
unenforceable. We assume for the purpose of this appeal that the lease may

require Alaska to compensate the Port for some or all ofthe damages it incurs as
a result ofAdamson's injury. Wefocus instead onwhether AMHS had the authority
to sign a lease that would allow the Port to sue Alaska on a claim related to the
injury of a state-employed seaman.

       Ultra Vires Actions

       Alaska argues that it has withdrawn its waiver of sovereign immunity for all
claims arising out of injuries to state-employed seamen. The Port argues that this
withdrawal was limited to cases brought by the injured employees, and does not

apply tosuits by third parties.3 Because the plain language of the statute does not

3The Port does not claim that Alaska withdrew its sovereign immunity in the lease itself,
only through the statute.
                                           4
No. 72925-0-1 / 5

support the Port's interpretation, we agree with Alaska.

        When public officials enter into contracts that are outside the scope of their

authority, the contracts are void and unenforceable under the ultra vires doctrine.

Noel v. Cole. 98 Wn.2d 375, 378, 655 P.2d 245 (1982) (superseded by statute on

unrelated grounds). An agreement may be ultra vires because the substance of

the contract was outside of the agent's authority, or because the agent failed to

follow statutorily required procedures for entering into the contract. Noel. 98 Wn.2d

at 379.

          Here, Alaska's constitution authorizes its legislature to establish the limits

of sovereign immunity. Alaska Const, art. II, § 21. The Alaska legislature

provided a limited waiver of sovereign immunity by statute for most tort and

contract claims. AS 09.50.250. But the state of Alaska withdrew that waiver of

sovereign immunity for claims arising out of injuries to state-employed seamen in

2003:

          A person or corporation having a contract, quasi-contract, or tort
          claim against the state may bring an action against the state in a
          state court that has jurisdiction over the claim. . . . However, an
          action may not be brought if the claim

          (5) arises out of injury, illness, or death of a seaman that occurs or
          manifests itself during or in the course of, or arises out of,
          employment with the state; AS 23.30 provides the exclusive remedy
          for such a claim, and no action may be brought against the state, its
          vessels, or its employees under the Jones Act (46 U.S.C. 30104--
          30105), in admiralty, or under the general maritime law.

AS 09.50.250.

          When the meaning and language ofa statute is clear, this court gives "effect

to that plain meaning." TracFone Wireless. Inc. v. Dep't of Revenue, 170 Wn.2d
No. 72925-0-1 / 6

273, 281, 242 P.3d 810 (2010).

      The statute's plain language indicates a broad exclusion of all claims that

arise out of injuries to state-employed seamen. There is no language in the statute

that limits its scope only to those claims brought by injured seamen. The statute

indicates that chapter 23.30 AS, Alaska's Workers' Compensation Act (AWCA),

will be the exclusive remedy for all these claims. The AWCA specifies that the no-

fault compensation provided to workers through AS 23.30.045 is the exclusive

remedy for an employee, or "anyone otherwise entitled to recover damages from

the employer or fellow employee at law or in admiralty on account of the injury or

death." AS 23.30.045, .055. Therefore, Alaska's sovereign immunity bars all

claims that arise out of injuries to Alaska-employed seamen.

       While the legislative history cited by the Port suggests that the Alaska

legislature's main concern was eliminating injured employees' claims under

maritime law, the statute's plain language provides a much broader exclusion. It

is improper for this court to examine material "outside the statute" when the

statute's language is unambiguous. Cerrillo v. Esparza. 158 Wn.2d 194, 203-04,

142P.3d 155(2006).

       Here, no one disputes that Adamson is a state-employed seaman or that

she suffered her injury within the scope of her employment with Alaska. Thus,

Adamson's injury is the type of injury for which Alaska withdrew its waiver of

sovereign immunity.

       Adamson's injury is the source of all the Port's claims against Alaska. The

Port brought five causes of action against Alaska. The claims were for negligence
No. 72925-0-1 / 7

under Washington law, negligence under general maritime law, breach of contract,

right to allocation of fault under the lease, and general maritime indemnity. In its

third-party complaint, the Port explicitly premised Alaska's liability to the Port for

each of those claims upon a finding that the Port was liable to Adamson.

       Accordingly, Alaska's sovereign immunity would bar all five of the Port's

claims. AMHS officials had no authority to subject Alaska to suits for which the

legislature retained Alaska's sovereign immunity. Any agreement by AMHS on

behalf of Alaska to the contrary is ultra vires and thus void and unenforceable.

       Equitable Estoppel

       The Port argues that, even if the lease was ultra vires, Alaska is equitably

estopped from barring the Port's claims.        We reject this argument because

equitable estoppel is not available when the inconsistent act was substantively

ultra vires.

       "The State does not 'act' and will not be held estopped based on the ultra

vires acts of its officers." Board of Regents of Univ. of Wash, v. Citv of Seattle.

108 Wn.2d 545, 552, 741 P.2d 11 (1987). "[Ejstoppel may not be asserted to

enforce the promise of one who had no authority to enter into that undertaking on

behalf of the state." State v. Nw. Maonesite Co.. 28 Wn.2d 1, 26, 182 P.2d 643

(1947). But courts draw a line between acts that are substantively ultra vires and

those that are procedurally ultra vires. Finch v. Matthews. 74 Wn.2d 161,172,443

P.2d 833 (1968). Acts are procedurally ultra vires when the agents acted within
their powers but exercised those powers "in an irregular manner or through
unauthorized procedural means." Finch, 74 Wn.2d at 172. Courts may apply the
No. 72925-0-1 / 8

doctrine of equitable estoppel to procedurally ultra vires acts. Finch. 74 Wn.2d at

171. "The distinction between procedural irregularity and a substantive lack of

authority is justified by the fact that in the latter case, the agency lacks the power

to do the act in any manner." Noel. 98 Wn.2d at 381 n.3.

       An act may be procedurally ultra vires when an agency has the authority to

commit the act but ignores a required procedure. In Noel, the Department of

Natural Resources (DNR) agreed to sell timber without conducting an

environmental impact study. 98 Wn.2d at 381. DNR unquestionably had the

authority to contract to sell timber, but the act was procedurally ultra vires because

state law required DNR to prepare an environmental impact statement first. Noel.

98Wn.2dat381.

       Here, AMHS lacked the substantive authority to subject Alaska to suit for

this type of claim. There was not any manner in which AMHS was authorized to

withdraw Alaska's sovereign immunity. Therefore, Alaska is not estopped from

withdrawing from a commitment that purports to do so.

       Accordingly, the Port cannot recover from Alaska based on any obligations

in the lease. We affirm the trial court's dismissal of those claims.

                                Non-Contract Claims

       The Port appeared to concede at oral argument that, despite bringing

negligence claims directly against Alaska, its claims against Alaska actually sound
in contract. The Port is correct. The Port claims that any damages it owes to

Adamson were caused by Alaska's breach of its duties to the Port "under the

                                          8
No. 72925-0-1 / 9

[Ijease, general maritime law, and/or Washington common law."4 But the Port

never argues to this court that Alaska owes it any duties that do not arise from the

lease. And it only seeks a judgment against Alaska in the event that Adamson

obtains a judgment against the Port.      Additionally, in its reply brief, the Port

withdrew its claim that there was admiralty jurisdiction over this action, thereby,

presumably, indicating it was withdrawing its maritime claims against Alaska.

       Given the resolution of this appeal, we do not reach the Port and Alaska's

disputes over the maritime character of the underlying tort and the construction of

Washington's Industrial Insurance Act, Title 51.

       Affirmed.

                                                       \t\ ^kt^| \ ^
WE CONCUR:

                                                           (jfrj*

 CP at 24-25.