Devore v. Samuel

• Decision Date: 20 December 2022
• Docket Number: COA22-305
• Citation: 2022 NCCOA 834
• Parties: FRED W. DEVORE, III as Guardian ad Litem for AZARIA HORTON, a Minor, Plaintiff, v. CHARLES LAMONTE SAMUEL, JR., STACY V. SAMUEL, KINDERCARE EDUCATION, LLC and KINDERCARE LEARNING CENTERS, LLC, Defendants. KINDERCARE EDUCATION, LLC and KINDERCARE LEARNING CENTERS, LLC, Defendants/Third-Party Plaintiffs, v. CHARLOTTE-MECKLENBURG BOARD OF EDUCATION, and KEYERA GORDON, Third-Party Defendants.
• Court: North Carolina Court of Appeals

2022-NCCOA-834

FRED W. DEVORE, III as Guardian ad Litem for AZARIA HORTON, a Minor, Plaintiff, v. CHARLES LAMONTE SAMUEL, JR., STACY V. SAMUEL, KINDERCARE EDUCATION, LLC and KINDERCARE LEARNING CENTERS, LLC, Defendants.

KINDERCARE EDUCATION, LLC and KINDERCARE LEARNING CENTERS, LLC, Defendants/Third-Party Plaintiffs, v. CHARLOTTE-MECKLENBURG BOARD OF EDUCATION, and KEYERA GORDON, Third-Party Defendants.

No. COA22-305

Court of Appeals of North Carolina

December 20, 2022

Heard in the Court of Appeals 18 October 2022.

Appeal by third-party defendant from order entered 7 January 2022 by Judge Jesse Caldwell, IV, in Mecklenburg County, No. 21 CVS 7323 Superior Court.

Shumaker, Loop &Kendrick, LLP, by Steven A. Meckler and Daniel R. Hansen, for third-party plaintiffs-appellees.

J Melissa Woods and Hope A. Root for third-party defendant-appellant Charlotte-Mecklenburg Board of Education.

DIETZ Judge

¶ 1 This case presents an issue of first impression concerning the waiver of governmental immunity for local school boards in school bus negligence cases. As explained below, we hold that the limited waiver of governmental immunity in these bus negligence cases does not permit a defendant to join a local school board as a third-party defendant in a court proceeding on claims of indemnity or contribution.

¶ 2 Although our State's case law permits parties to join the State and state agencies in these third-party proceedings, the applicable statutes and rules do not unambiguously permit joinder of local governmental entities. Accordingly, applying the principle that we must strictly construe these immunity provisions against waiver, we hold that these indemnification and contribution claims are permissible only in the Industrial Commission.

Facts and Procedural History

¶ 3 In June 2018, a Charlotte-Mecklenburg Schools bus dropped off an elementary school student at an afterschool childcare center operated by Defendants KinderCare Education, LLC, and KinderCare Learning Centers, LLC (collectively "KinderCare"). As the child crossed the street to the KinderCare center, Defendant Charles Samuel struck the child with his SUV.

¶ 4 Plaintiff brought this negligence action on behalf of the injured child against a number of defendants, including KinderCare. Plaintiff did not assert claims against the school bus driver or the Charlotte-Mecklenburg Board of Education, who employed the bus driver. KinderCare later filed a third-party complaint against the Charlotte-Mecklenburg Board of Education and the bus driver, alleging claims for contribution and indemnity.

¶ 5 The school board moved to dismiss on the ground that the third-party claims were barred by governmental immunity. After a hearing, the trial court denied the motion. The school board timely appealed. Although the trial court's order is interlocutory, we possess appellate jurisdiction because the challenged order concerns an issue of governmental immunity. Ballard v. Shelley, 257 N.C.App. 561, 564, 811 S.E.2d 603, 605 (2018).

Analysis

¶ 6 "Counties and other municipalities, as governmental agencies, enjoy the protections of governmental immunity." Ballard v. Shelley, 257 N.C.App 561, 564, 811 S.E.2d 603, 606 (2018). This governmental immunity applies to a local school board because it "is a governmental agency, and is therefore not liable in a tort or negligence action except to the extent that it has waived its governmental immunity pursuant to statutory authority." Magana v. Charlotte-Mecklenburg Bd. of Educ., 183 N.C.App. 146, 148, 645 S.E.2d 91, 92 (2007).

¶ 7 We review claims of governmental immunity de novo. Wray v. City of Greensboro, 370 N.C. 41, 47, 802 S.E.2d 894, 898 (2017). Waivers of governmental immunity "may not be lightly inferred" and statutes purportedly waiving this immunity "must be strictly construed." Guthrie v. N. Carolina State Ports Auth., 307 N.C. 522, 537-38, 299 S.E.2d 618, 627 (1983); Magana, 183 N.C.App. at 149, 645 S.E.2d at 92.

I. Waiver of immunity for indemnity/contribution claims

¶ 8 We begin by examining KinderCare's argument that the school board may be joined as a third party in this court proceeding because a series of statutes waive the school board's governmental immunity for this type of third-party claim in the court system.

¶ 9 Importantly, the parties do not dispute that KinderCare's third-party claims could be asserted against the school board in the Industrial Commission under the Tort Claims Act. In other words, this dispute is not about whether governmental immunity totally bars these claims. Instead, the issue is whether the school board's statutory waiver of immunity is limited to claims in the Industrial Commission, or whether it is broader and applies to third-party claims asserted in court.

¶ 10 To understand KinderCare's argument, we must first examine the series of statutes and rules on which it is based. We begin with Rule 14 of the North Carolina Rules of Civil Procedure. Rule 14 "permits a defendant in the State courts to sue a person not a party to the action who is or may be liable to the defendant for all or part of the plaintiff's claim against the defendant." Teachy v. Coble Dairies, Inc., 306 N.C. 324, 329, 293 S.E.2d 182, 185 (1982). Subsection (c) of the rule provides that, notwithstanding the Tort Claims Act, the State of North Carolina and state agencies may be joined as third parties in tort actions:

Rule applicable to State of North Carolina. -Notwithstanding the provisions of the Tort Claims Act, the State of North Carolina may be made a third party under subsection (a) or a third-party defendant under subsection (b) in any tort action. In such cases, the same rules governing liability and the limits of liability of the State and its agencies shall apply as is provided for in the Tort Claims Act.

N.C. Gen. Stat. § 1A-1, Rule 14(c).

¶ 11 Similarly, the Uniform Contribution Among Tort-Feasors Act states that the right to contribution "shall apply to tort claims against the State. However, in such cases, the same rules governing liability and the limits of liability shall apply to the State and its agencies as in cases heard before the Industrial Commission." N.C. Gen. Stat. § 1B-1(h).

¶ 12 Our Supreme Court has interpreted Rule 14 and N.C. Gen. Stat. § 1B-1(h) as a waiver of sovereign immunity that permits the State to "be joined as a third-party defendant, whether in an action for contribution or in an action for indemnification, in the State courts," subject to the limitations set out in those provisions. Teachy, 306 N.C. at 332, 293 S.E.2d at 187. In other words, Teachy interpreted these rules as expanding the limited waiver in the Tort Claims Act-one which requires the claims to be brought in the Industrial Commission-to permit third party claims in court proceedings.

¶ 13 Thus, as the parties acknowledge, the State and state agencies can be joined as third-party defendants in court proceedings for claims of contribution or indemnification under Teachy. The critical question in this appeal is whether a local school board likewise may be joined in these court proceedings.

¶ 14 It is well settled that a local school board is not "the State of North Carolina" for ordinary legal purposes. There is a difference between the State and state agencies-which possess sovereign immunity-and local government entities such as local school boards-which possess only governmental immunity, not sovereign immunity. See, e.g., State ex rel. Stein v. Kinston Charter Acad., 379 N.C. 560, 2021-NCSC-163, ¶¶ 22, 26 (distinguishing between state agencies and local governmental school entities).

¶ 15 But KinderCare points to a provision of the Tort Claims Act governing claims "against county and city boards of education for accidents involving school buses or school transportation service vehicles." N.C. Gen. Stat. § 143-300.1. In Section 143300.1, the General Assembly provided that the liability of a local school board in school bus negligence cases "shall be the same in all respects" as a similar claim against the State Board of Education:

Claims against county and city boards of education for accidents involving school buses or school transportation service vehicles.

(a) The North Carolina Industrial Commission shall have jurisdiction to hear and determine tort claims against any county board of education or any city board of education [for school bus negligence] when:

(1) The driver is an employee of the county or city administrative unit of which that board is the governing body, and the driver is paid or authorized to be paid by that administrative unit . . .

. . . The liability of such county or city board of education, the defenses which may be asserted against such claim by such board, the amount of damages which may be awarded to the claimant, and the procedure for filing, hearing and determining such claim, the right of appeal from such determination, the effect of such appeal, and the procedure for taking, hearing and determining such appeal shall be the same in all respects as is provided in this Article with respect to tort claims against the State Board of Education except as hereinafter provided.

N.C. Gen. Stat. § 143-300.1 (emphasis added).

¶ 16 KinderCare relies on this statutory language to assert that "the process for determining a local school board's liability for negligent school-bus operation" must be "undertaken just as it would be if the local board were the State Board of Education." It follows, according to KinderCare, that for purposes of school bus negligence claims, a local school board is the State Board of Education. And, because the State Board of Education is a state agency, KinderCare further argues that the local school board in this case can be joined as...