Ducey v. U.S.

• Decision Date: 27 October 1983
• Docket Number: No. 81-6058,81-6058
• Citation: 713 F.2d 504
• Parties: Carolyn L. DUCEY, et al., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee. Lois M. OLSON, et al., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee. Helen GRUGEL, et al., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 504

713 F.2d 504

Carolyn L. DUCEY, et al., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.

Lois M. OLSON, et al., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.

Helen GRUGEL, et al., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.

No. 81-6058.

United States Court of Appeals Ninth Circuit.

Argued and Submitted Oct. 13, 1982.

Decided Aug. 18, 1983.

As Amended Oct. 27, 1983.

Betsy Ginsberg, Trial Atty., U.S. Dept. of Justice, Washington, D.C., for defendant-appellee.

Arthur J. Jaffee, Pomona, Cal., for plaintiffs-appellants.

Appeal from the United States District Court for the District of Nevada.

Before SKOPIL and FLETCHER, Circuit Judges, and GRAY, ^* District Judge.

FLETCHER, Circuit Judge:

Plaintiffs appeal from the district court's judgment for the defendant United States in three consolidated wrongful death actions brought pursuant to the Federal Tort Claims Act (FTCA), 28 U.S.C. §§ 1346(b), 2671-2680 (1976). 523 F.Supp. 225 (D.Nev.1981). We have jurisdiction under 28 U.S.C. § 1291 (1976). We reverse in part and affirm in part.

FACTS

The spouses of the three plaintiffs in these consolidated cases (the "Users") were killed in a flash flood in the Lake Mead National Recreational Area (LMNRA) in Nevada on September 14, 1974. The Users had been camping at and boating from a recreational site on the banks of the Colorado River in Eldorado Canyon. The National Park Service (NPS), the agency that operated the LMNRA, provided a ranger station, boat launching ramp, and comfort stations at the site. In the same area Eldorado Canyon Resorts, Inc. (ECR), a concessioner of the NPS, maintained and operated a cafe-store, boat slips, automobile fueling and boat service facilities, rental cabins, and trailer spaces.

The parties stipulated that on the day of the flood, each of the Users was present "in the canyon that day for recreational purposes." None of the Users had paid a fee directly to the NPS or to the United States either to gain entrance to or to engage in recreational activities on the public lands in the LMNRA or to use the NPS-provided facilities. Two of the Users had paid rental fees to ECR for use of a boat slip, one User had rented a trailer space, and all three Users had recently bought various goods at the ECR cafe-store.

Pursuant to the terms of the concession agreement between ECR and the NPS, ECR was obligated to remit to the United States 1 3/4% of its gross annual receipts ¹ from sales at the cafe-store and from boat slip and trailer space rentals and to fulfill certain other maintenance and caretaking responsibilities. However, ECR in fact made no payment to the NPS for the calendar year 1974.

Following the flood, the surviving spouses of the Users brought suit against the United States in district court for damages allegedly caused by a breach of duty of NPS and ECR employees to warn of or guard against the flood.

ANALYSIS

The FTCA provides a limited exception to the sovereign immunity of the United States for suits in tort, where an injury is

caused by the negligent or wrongful act or omission of any employee of the Government while acting within the scope of his office or employment, under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.

28 U.S.C. § 1346(b).

I. Tort Liability of United States for Negligence of NPS Employees.

The trial court, applying the law of the place (Nevada), ² found the Government immune from tort liability under the Nevada recreational use statute, Nev.Rev.Stat. 41.510 (1973). ³ Plaintiffs challenge this holding, asserting that immunity under the recreational use statute does not obtain here. The government contends that, even if the ruling below were incorrect, the government is not liable because the government's conduct falls within the discretionary function exemption from tort liability contained in the FTCA.

A. Immunity Under Recreational Use Statute.

Apart from the generally applicable Nevada rules governing tort liability, the Nevada recreational use statute ⁴ provides immunity for a landowner whose property is used for recreational purposes, subject, however, to several exceptions. In holding for the defendant, the trial court found that section 41.510(1), the immunity section, is applicable to the facts of this case and that neither of two possible exceptions contained in section 41.510(3) change the result. In particular, the district court found the consideration exception to the Nevada recreational use statute, subsection 41.510(3)(b), inapplicable on the ground that the various forms of "consideration" allegedly tendered by the Users--money for store purchases, moorage fees, and trailer space rental fees--were tendered not to the United States but to ECR and that "[m]oney paid to the concessioner is not payment to the Government."

Plaintiffs challenge this holding on the ground that the consideration exception is applicable on the facts of this case. The Government contends that the district court's conclusion should be upheld for two reasons: (1) since the Users made no direct payments for permission to enter, no "consideration" in the sense of subsection 41.510(3)(b) was tendered; and (2) even if such "consideration" in the sense of subsection 41.510(3)(b) was tendered, it was not tendered to the United States. We reject both of the Government's contentions and conclude that the exception is applicable here. ⁵

1. Lack of Transfer of "Consideration."

The Government argues first that even if the Government itself had operated the Eldorado Canyon facility none of the various forms of consideration ECR received are the sort of "consideration" in return for "permission to participate in recreational activities" required under subsection 41.510(3)(b). Like any other visitors to Eldorado Canyon, the Users paid no direct fee to enter the Canyon, to boat on the Colorado, or to hike, fish, sightsee, or participate in any other recreational activity in the Canyon. The only consideration tendered was for the purchase of products or for the use of the artificial amenities of trailer spaces and boat slips. The Government insists that subsection 41.510(3)(b) is applicable only where a fee is specifically charged for permission to enter. We do not read the exception so narrowly.

No Nevada or Ninth Circuit cases construing Nevada law address the scope of the consideration exception to the Nevada statute. However, the statutory language, the principle of statutory construction governing statutes in derogation of the common law, the policy underlying the statute, and the case law of other jurisdictions all support a broad application of that exception.

First, the language of the consideration exception itself suggests a broad reading of section 41.510(3)(b). The exception is worded not in narrow terms of "fee" or "charge," but rather in the far more encompassing terms, "for a consideration." ⁶ "Consideration" is a term of art, a word with a well-understood meaning in the law, embracing any "right, interest, profit or benefit." Black's Law Dictionary 277 (rev. 5th ed. 1979). Used in a statute, it should be accorded that meaning. Application of Filippini, 66 Nev. 17, 24, 202 P.2d 535, 538 (1949). The statutory exception, then, is itself literally applicable to situations well beyond those involving a strict charging of a "fee" for "permission" to recreate. ⁷

Since the recreational use statute is in derogation of common law rules of tort liability, we take care to avoid an overbroad interpretation of the statute that would afford immunity that was not intended. See Rush v. Nevada Industrial Commission, 94 Nev. 403, 407, 580 P.2d 952, 954 (1978) (statute in derogation of common law should be read narrowly); West Indies, Inc. v. First National Bank of Nevada, 67 Nev. 13, 33-34, 214 P.2d 144, 154 (1950) (same); Copeland v. Larson, 46 Wis.2d 337, 347, 174 N.W.2d 745, 749-50 (1970) (recreational use statute construed narrowly since in derogation of common law). Consequently, exceptions to the statute, including the consideration exception, must be given the broadest reading that is within the fair intendment of the language used.

The policy underlying the adoption of a consideration exception to the Nevada recreational use statute is to retain tort liability in actions involving recreational use of land where the use of the land for recreational purposes is granted not gratuitously but in return for an economic benefit. ⁸ Since the potential for profit alone is thought sufficient to encourage those owners who wish to make commercial use of their recreational lands to open them to the public, the further stimulus of tort immunity is both unnecessary and improper. ⁹ Furthermore, where a landowner derives an economic benefit from allowing others to use his land for recreational purposes, the landowner is in a position to post warnings, supervise activities, and otherwise seek to prevent injuries. Such a landowner also has the ability to purchase liability insurance or to self-insure, thereby spreading the cost of accidents over all users of the land. ¹⁰

An ability to spread risks exists regardless of whether the economic benefit the landowner derives is in the form of direct entrance fees or in the form of revenues from a connected economic enterprise. Confining the term "consideration" in subsection 41.510(3)(b) solely to direct payments of entrance fees or charges would extend the immunity of the statute beyond those persons whom the statutory policy would protect.

Our conclusion is consistent with decisions of this and other courts, construing the consideration exceptions of the recreational use statutes of other states. In Graves v. United States Coast Guard, 692 F.2d 71, 73 (9th Cir.1982) (per curiam), we held that the California recreational use statute...