Concerned Citizens of Kimball County, Inc. v. Department of Environmental Control of State

• Decision Date: 03 September 1993
• Docket Number: No. S-91-553,S-91-553
• Citation: Concerned Citizens of Kimball County, Inc. v. Department of Environmental Control of State, 505 N.W.2d 654, 244 Neb. 152 (Neb. 1993)
• Parties: CONCERNED CITIZENS OF KIMBALL COUNTY, INC., Appellant, v. DEPARTMENT OF ENVIRONMENTAL CONTROL of the STATE of Nebraska and Waste-Tech Services, Inc., Appellees.
• Court: Nebraska Supreme Court

Page 654

505 N.W.2d 654

244 Neb. 152

CONCERNED CITIZENS OF KIMBALL COUNTY, INC., Appellant, v. DEPARTMENT OF ENVIRONMENTAL CONTROL of the STATE of Nebraska and Waste-Tech Services, Inc., Appellees.

No. S-91-553.

Supreme Court of Nebraska.

Sept. 3, 1993.

Syllabus by the Court

1. Constitutional Law: Immunity: Waiver: Legislature. Neb. Const. art. V, § 22, concerning a waiver of sovereign immunity, is not self-executing. Legislative action is necessary to waive the state's sovereign immunity.

2. Statutes: Immunity. Since statutes authorizing suit against the state are in derogation of the state's sovereignty, such statutes are strictly construed.

3. Immunity: Waiver. Waiver of sovereign immunity will be found only where stated by the most express language or by such overwhelming implications from the text as will leave no room for any other reasonable construction.

4. Actions: Immunity. For purposes of applying the doctrine of sovereign immunity, a suit against an agency of the state is the same as a suit against the state.

5. Actions: Public Officers and Employees: Statutes: Immunity. A declaratory or other equitable action against a state officer or agent to obtain relief from an invalid act or from an abuse of authority by the officer or agent is not a suit against the state and is not prohibited by the general principles governing the immunity of the state from suit.

6. Declaratory Judgments: Immunity: Waiver. Nebraska's Uniform Declaratory Judgments Act, Neb.Rev.Stat. §§ 25-21,149 to 25-21,164 (Reissue 1989), does not waive the State of Nebraska's sovereign immunity.

7. Declaratory Judgments: Parties. A declaratory judgment is applicable only where all interested and necessary persons are made parties to the proceeding.

8. Parties: Words and Phrases. An indispensable party is one who has an interest in the controversy to an extent that such party's absence from the proceedings prevents a court from making a final determination concerning the controversy without affecting such party's interest.

9. Declaratory Judgments: Parties: Jurisdiction: Waiver. The presence of all necessary or indispensable parties is jurisdictional in a declaratory judgment action and cannot be waived by the parties.

10. Demurrer: Pleadings: Appeal and Error. When a demurrer to a petition is sustained, a court must grant a plaintiff leave to amend the petition unless it is clear that no reasonable possibility exists that repleading will correct the defective petition. After the demurrer has been sustained, but where there is a reasonable possibility that the defective petition may be cured by amendment, denying the plaintiff the opportunity to replead is an abuse of discretion.

11. Summary Judgment: Jurisdiction. A summary judgment motion based on jurisdictional grounds is treated as and serves the same purpose as a demurrer on jurisdictional grounds.

12. Actions: Res Judicata: Parties. The doctrine of res judicata precludes relitigation of a claim only if the parties to the present action are the same or in privity to the parties in the former action.

Mark A. Ludwig, of Germer, Murray & Johnson, Hebron, for appellant.

Don Stenberg, Attorney General, and Linda L. Willard, Lincoln, for appellee dept.

Mark A. Christensen, Cline, Williams, Wright, Johnson & Oldfather, Lincoln, Marcus L. Squarrell and Robert F. Copple, Parcel, Mauro, Hultin & Spaanstra, P.C., and Ruth Brammer Johnson, Denver, CO, for appellee Waste-Tech.

BOSLAUGH, WHITE, CAPORALE, SHANAHAN, FAHRNBRUCH, and LANPHIER, JJ., and GRANT, J., Retired.

PER CURIAM.

Concerned Citizens of Kimball County, Inc., filed an action under the Uniform Declaratory Judgments Act, Neb.Rev.Stat. §§ 25-21,149 to 25-21,164 (Reissue 1989), challenging the Nebraska Department of Environmental Control's issuance of a permit to build a hazardous waste incinerator.

On October 27, 1987, Waste-Tech Services, Inc. (Waste-Tech), filed a permit application with the Nebraska Department of Environmental Control (Department), seeking a permit to build and operate a hazardous waste incineration and storage facility in Kimball County. The application listed Waste-Tech as the operator of the facility and Thermal, Inc. (Thermal), as the owner of the real estate on which the facility was to be built. During the public comment period before issuance of the permit, Waste-Tech requested that the final permit designate Gus Koustas and George Koustas as owners of the Kimball facility. The Koustases were the officers and sole shareholders of Thermal. On November 17, 1988, the Department issued the final permit, which listed Waste-Tech as operator and the Koustases as owners.

On November 30, 1988, Amoco Oil Holding Company (Amoco), Waste-Tech's corporate parent, purchased the Koustases' interest in the Kimball facility. Subsequently, Amoco transferred its interest to Waste-Tech, making Waste-Tech both owner and operator of the facility. In a letter dated December 6, 1988, Waste-Tech informed the Department that it had acquired title to the property.

On December 3, 1990, Concerned Citizens of Kimball County, Inc. (Concerned Citizens), filed a petition for declaratory relief in the district court for Lancaster County. In its petition, Concerned Citizens alleged that its members are Kimball County residents and landowners with interests in real estate in close proximity to the site of the proposed facility and that its members will suffer diminished real estate values and potential health hazards if the facility is built. The amended petition further contended that the Department's issuance of the permit was unlawful because the Department had no authority to issue the permit to the Koustases as owners when the application had been filed by Waste-Tech. Therefore, the petition sought a declaration that the permit was void at its inception and could not legally be transferred to Amoco or Waste-Tech and that there is currently no valid permit for the Kimball facility.

The Department filed a demurrer to Concerned Citizens' petition on the grounds that the district court had no subject matter jurisdiction and that Concerned Citizens was not a proper plaintiff. Waste-Tech filed a motion for summary judgment. The district court sustained the Department's demurrer on both grounds mentioned in the demurrer and dismissed the action against the Department. The court also granted Waste-Tech's summary judgment motion and dismissed the action with prejudice because (1) no genuine issues of material fact existed, (2) Concerned Citizens' action was an improper collateral attack on the decision of an administrative agency, and (3) Concerned Citizens had no standing.

Concerned Citizens contends that the district court erred in (1) sustaining the Department's demurrer to Concerned Citizens' petition, (2) granting Waste-Tech's motion for summary judgment, and (3) dismissing Concerned Citizens' petition with prejudice.

Concerned Citizens contends that the district court erred in holding that the Department was immune from this declaratory judgment action because of the state's sovereign immunity. The district court sustained the Department's demurrer because the state's sovereign immunity meant that the court had no subject matter jurisdiction.

Lack of subject matter jurisdiction is a proper ground for a demurrer to a petition. Neb.Rev.Stat. § 25-806 (Reissue 1989); Knapp v. City of Omaha, 175 Neb. 576, 122 N.W.2d 513 (1963).

Article V, § 22, of the Nebraska Constitution provides: "The state may sue and be sued, and the Legislature shall provide by law in what manner and in what courts suits shall be brought." Article V, § 22, is not self-executing. Legislative action is necessary to waive the state's sovereign immunity. See Gentry v. State, 174 Neb. 515, 118 N.W.2d 643 (1962). Since statutes authorizing suit against the state are in derogation of the state's sovereignty, such statutes are strictly construed. See, Wiseman v. Keller, 218 Neb. 717, 358 N.W.2d 768 (1984); Catania v. The University of Nebraska, 204 Neb. 304, 282 N.W.2d 27 (1979), overruled on other grounds, Blitzkie v. State, 228 Neb. 409, 422 N.W.2d 773 (1988); Gentry v. State, supra; Anstine v. State, 137 Neb. 148, 288 N.W. 525 (1939), overruled on other grounds, Beatrice Manor v. Department of Health, 219 Neb. 141, 362 N.W.2d 45 (1985). Hence, "[w]aiver [of sovereign immunity] will only be found 'where stated "by the most express language or by such overwhelming implications from the text as [will] leave no room for any other reasonable construction." ' " Wiseman v. Keller, 218 Neb. at 720, 358 N.W.2d at 770 (quoting Edelman v. Jordan, 415 U.S. 651, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974)). Accord Security Inv. Co. v. State, 231 Neb. 536, 437 N.W.2d 439 (1989).

Moreover, for purposes of applying the doctrine of sovereign immunity, a suit against an agency of the state is the same as a suit against the state. See, Beatrice Manor v. Department of Health, supra; State, ex rel. Walker, v. Board of Commissioners, 141 Neb. 172, 3 N.W.2d 196 (1942); Anstine v. State, supra.

However, a declaratory or other equitable action against a state officer or agent to obtain relief from an invalid act or from an abuse of authority by the officer or agent is not a suit against the state and is not prohibited by the general principles governing the immunity of the state from suit. See, Bartels v. Lutjeharms, 236 Neb. 862, 464 N.W.2d 321 (1991); Rein v. Johnson, 149 Neb. 67, 30 N.W.2d 548 (1947), cert. denied 335 U.S. 814, 69 S.Ct. 31, 93 L.Ed. 369 (1948); State, ex rel. Walker, v. Board of Commissioners, supra. See, also, Grinnell v. State, 121 N.H. 823, 435 A.2d 523 (1981); Lister v. Board of Regents, 72 Wis.2d 282, 240 N.W.2d 610 (1976); Collins v. State Board of Social Welfare, 248 Iowa 369, 81 N.W.2d 4 (1957); Battleship Texas Ad. Bd. v. Texas Dynamics, 737 S.W.2d 414 (Tex.Civ.App.1987); Bagg v. Univ. of Texas Medical Branch, 726 S.W.2d 582 (Tex.Civ.App.19...