Iowa Supreme Court Considers DMWW Common Law Claims

A replay of the oral argument is available here.

 

The Iowa Supreme Court heard oral arguments on September 14, 2016, regarding the common law claims set forth in the Des Moines Water Works complaint. The Court will now consider whether the lawsuit’s claims seeking money damages and injunctive relief can continue under Iowa law or whether the drainage districts are immune from these types of legal claims.

On March 16, 2015, the Des Moines Board of Water Works Trustees (DMWW) filed a federal Clean Water Act (CWA) lawsuit against the supervisors and drainage districts of Buena Vista, Sac and Calhoun Counties in Iowa. The lawsuit, which was filed in the United States District Court for the Northern District of Iowa, alleges that the county supervisors, in their capacity as drainage district trustees, are operating their drainage districts in an “unlawful and antisocial” manner that is contrary to the “public health and welfare.” Notably, the claims contend that this wrongful conduct stems from the drainage districts’ “normal and intended operation.”

The causes of action set forth by the lawsuit fall into two categories: (1) Claims under the CWA (and companion Iowa law) positing that discharges from drainage districts are “point sources” of nitrate pollution for which a National Pollutant Discharge Elimination System (NPDES) permit is required and (2) claims seeking money damages and injunctive relief under state common law.  

It is the second category of claims currently under review by the Iowa Supreme Court. These claims assert that the drainage districts are responsible for the following torts: nuisance (public, private and a statutory), negligence, and trespass. The lawsuit also alleges that DMWW’s constitutional rights have been violated by the districts’ taking of DMWW property without just compensation (by polluting the property with nitrates) and asks the court to stop the continuation of these alleged harms through injunctive relief. But primarily, the second section of the DMWW lawsuit seeks money damages from the drainage districts. DMWW contends that its damages flow from the conduct of the defendant counties’ drainage districts, as well as from the conduct of similarly-situated drainage districts. These allegations leave open the possibility that other drainage districts could be brought into this lawsuit down the road.

In September of 2015, the drainage districts filed a motion for partial summary judgment, asking the federal court to dismiss the common law claims from the lawsuit. Among many arguments, the districts allege that long-standing, well-settled Iowa law establishes that drainage districts cannot be sued for money damages under any set of facts. The Iowa Supreme Court has, many times, reaffirmed this rule, finding that a “drainage district is merely an area of land, not an entity subject to a judgment for tort damages.” “A drainage district has no corporate existence for that purpose.” The Court has reached this conclusion based upon its finding that a drainage district is an entity with “special and limited powers and duties conferred by the Iowa Constitution.” The special and limited powers mean that a drainage district can only be sued to compel, complete, or correct the performance of those acting on behalf of the district. In other words, a court can compel a drainage district to fix damaged drainage tile within its jurisdiction. The courts have not, however, allowed plaintiffs to sue drainage districts for money damages under any circumstances. Any change in the categorical immunity the law has afforded these limited entities, they argue, must come from the legislature, not the courts.

DMWW acknowledges this precedent, but argues that this is an “ancient doctrine” and that the courts have never considered the novel facts of this case. DMWW alleges that the immunity granted to drainage districts in the past is qualified based upon the assumption that drainage is a public benefit. If that presumption is rebutted, they argue, that immunity dissolves. DMWW argues that the districts must be held responsible for the nitrate pollution flowing downstream. The DMWW court papers urge, “Drainage district immunity only perpetuates and expands the export of pollution to the common good’s detriment.”

Last January, the federal district court decided that the Iowa Supreme Court was best positioned to answer these important issues of state law. The district court recognized the “novelty of DMWW’s state law arguments” and “the public importance of this case.” The court then certified four questions to the Iowa Supreme Court:

Question 1: As a matter of Iowa law, does the doctrine of implied immunity of drainage districts as applied in cases such as Fisher v. Dallas County, 369 N.W.2d 426 (Iowa 1985), grant drainage districts unqualified immunity from all of the damage claims set forth in the Complaint?

Question 2: As a matter of Iowa law, does the doctrine of implied immunity grant drainage districts unqualified immunity from equitable remedies and claims, other than mandamus?

Question 3: As a matter of Iowa law, can the plaintiff assert protections afforded by the Iowa Constitution’s Inalienable Rights, Due Process, Equal Protection, and Takings Clauses against drainage districts as alleged in the Complaint?

Question 4: As a matter of Iowa law, does the plaintiff have a property interest that may be the subject of a claim under the Iowa Constitution’s Takings Clause as alleged in the Complaint?

Bottom line, these questions ask whether the districts can be sued for money damages or injunctive relief and whether DMWW can assert claims of constitutional violations against the districts. In May, the Iowa Supreme Court agreed to consider those questions and the parties completed oral arguments September 14.

While it’s impossible to tell from the brief argument how the seven Justices will rule, they asked the attorneys for the parties a number of questions:

  • “Ordinary, liability tracks with control. Can the drainage districts control farming practices?” (Waterman)
  • “Let’s say you [DMWW] win…what would the drainage districts do to mitigate?” (Mansfield)
  • “Are the drainage districts doing anything differently than they’ve done for the past 100 years?” (Cady)
  • "So you're saying there's an easement to pollute?" (Appel)
  • “What are the limits of the drainage districts' taxing powers? Could they go back and assess tort damages against landowners?” (Waterman)
  • “All government agencies have limited authority. Maybe in the early 1900s sovereign immunity was right. Why is it still right today?” (Appel)

This portion of the case is now “submitted” to the Iowa Supreme Court. The Court will consider the questions before it and issue a written opinion answering them. Based upon the Iowa Supreme Court’s opinion, the federal district court will decide to dismiss none, some, or all of the common law claims. The Iowa Supreme Court opinion will likely issue in early 2017.

Meanwhile, the federal district court will also have to decide whether to dismiss the other category of pending claims. In April of 2016, the drainage districts filed a motion for partial summary judgment on the claims filed under the CWA (and companion Iowa law).  In that part of the lawsuit, DMWW has alleged that the drainage districts must seek NPDES permits for their agricultural drainage. The complaint asks the federal court to declare that the drainage districts have violated federal and state law, to enjoin them from all discharges of nitrate not authorized by an NPDES or state operating permit, and to assess civil penalties against DMWW for each continuing day of violation. The districts contend that for the entire history of the CWA, Congress and the regulating agencies have considered agricultural drainage to be nonpoint source pollution not subject to permitting requirements.

Any claims the district court does not dismiss are scheduled for trial on June 26, 2017. To keep track of the current status of the litigation or to read the parties’ pleadings, please click here: www.calt.iastate.edu/article/des-moines-water-works-litigation-resources.

 

 

CALT does not provide legal advice. Any information provided on this website is not intended to be a substitute for legal services from a competent professional. CALT's work is supported by fee-based seminars and generous private gifts. Any opinions, findings, conclusions or recommendations expressed in the material contained on this website do not necessarily reflect the views of Iowa State University.

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