National Bank of South Dakota v. Leir

FOSHEIM, Chief Justice

(dissenting).

High-Grade Oil Co., Inc. v. Sommer, 295 N.W.2d 736 (S.D.1980), and Sioux Falls Construction Co. v. City of Sioux Falls, 297 N.W.2d 454 (S.D.1980), are the critical cases involved in the majority opinion.

I do not agree with the majority’s interpretation of High-Grade Oil. There is language in that case that if the State could be subjected to liability then the State employee is protected by the doctrine of sovereign immunity. However, I believe the holding in High-Grade Oil was squarely based on the traditional rule that a governmental employee is protected by the doctrine while performing his duties. In High-Grade Oil appellants argued that appellee Sommer, the State Highway Engineer, was acting outside the scope of his employment because he violated certain design safety standards when he designed or approved the design of the highway. In response to appellants’ argument this court stated, at 737-38:

We cannot agree. Under Article XIII, § 9 of our state constitution, construction and maintenance of public highways is a function of state government. The legislature by statute has vested the authority for such construction and maintenance in the Board of Transportation. Appellee is an employee of the Department of Transportation, the operational arm of the Board. Any action on his part in the performance of his duties, whether negligently done or otherwise, clearly is constitutional and is not void. In White Eagle, supra, the officers were sued in their official capacities, but the claim was that their actions were premised on an unconstitutional statute.
Considering then, as we must, that this is an action against the state, we next review appellants’ attack on the doctrine of ‘governmental’ or ‘sovereign immunity,’ which terms are interchangeable, (footnote omitted)

Sioux Falls Construction is another matter. While it adopts the rationale of High-Grade Oil and other decisions of this court which refused to judicially abolish the doctrine of sovereign immunity, it proceeds to adopt a Restatement definition of immunity based on whether an employee is acting with discretion. Sioux Falls Construction adopted this test even though it conceded, at 458,

*851the possibility of some instances where a city could be immune while exercising a governmental function, yet an officer could be liable; or, in the alternative, a situation where a city could be liable while acting in a proprietary function, yet the officer could be immune.
To uphold governmental immunity as to the governmental unit only, while allowing the officers, agents, and employees to be held liable, would be chaotic.

Our adoption of the Restatement’s discretion test, in effect, judicially revised the doctrine of sovereign immunity, contrary to this court’s consistent position that we would defer to the Legislature. For the reasons stated below, I repudiate my concurrence in the rationale of Sioux Falls Construction. The result, however, was correct. Sioux Falls Construction concerned a municipal corporation which was denied the benefit of the doctrine of sovereign immunity because it was not engaged in a governmental function, the city employee was likewise denied its benefit.

Leir and Kruger v. Wilson, 325 N.W.2d 851 (S.D.1982), apply the discretionary test adopted in Sioux Falls Construction and the state employees in each case are denied the benefit of the doctrine of sovereign immunity. The practical effect of the discretionary test is that it carves out a broad sector of governmental employees (those whose jobs do not require the use of discretion), who formerly were protected by the sovereign immunity doctrine, and singles them out to be personally liable for their negligence. Who are these employees? They are those least able to pay a personal judgment. Only policy-making employees (whose jobs require the use of discretion), and who therefore are the highest paid government employees, will be allowed to invoke the doctrine to shield themselves from personal liability.

Aside from these inequities, the test’s great weakness is that it is so vague and multifaceted that the temptation to manipulate it to reach a desired result can be overwhelming. Witness the result in Leir. While their negligence was deplorable, can anyone seriously contend that social workers do not exercise discretion? Also, the result in Kruger — driving a state car on state time is a ministerial function. Can driving a car be considered “ministerial” as that word has heretofore been used in the law?

Prior to Sioux Falls Construction this court applied a simple, straight-forward test to determine if the doctrine applied— was the employee acting within the scope of his employment when the injury occurred? Aside from its simplicity, this test treats all governmental employees the same, regardless of their position and earnings. The discretionary test will, in my opinion, lead this court into a quagmire and allow personal liability actions against those least able to pay.

I would affirm the summary judgments entered in Leir and Kruger.

I am authorized to state that Circuit Judge ANDERST joins in this dissent.