England v. State ex rel. Iowa Dep't of Transp.

• Decision Date: 03 August 2022
• Docket Number: 21-0470
• Parties: JEFFREY ENGLAND, LARRY ENGLAND and CHARLOTTE ENGLAND, Plaintiffs-Appellees, v. STATE OF IOWA ex rel., IOWA DEPARTMENT OF TRANSPORTATION, Defendant-Appellant.
• Court: Iowa Court of Appeals

JEFFREY ENGLAND, LARRY ENGLAND and CHARLOTTE ENGLAND, Plaintiffs-Appellees, v. STATE OF IOWA ex rel., IOWA DEPARTMENT OF TRANSPORTATION, Defendant-Appellant.

No. 21-0470

Court of Appeals of Iowa

August 3, 2022

Appeal from the Iowa District Court for Wapello County, Crystal S Cronk, Judge.

The Iowa Department of Transportation (DOT) appeals the district court's denial of the DOT's motion for summary judgment. REVERSED AND REMANDED.

Thomas J. Miller, Attorney General, and Matthew S. Rousseau Assistant Attorney General, for appellant.

Nathan A. Olson and Christine E. Branstad of Branstad &Olson Law Office, Des Moines, for appellees.

Considered by May, P.J., and Schumacher and Badding, JJ.

SCHUMACHER, Judge.

This opinion addresses the second appeal concerning a 2016 land auction by the Iowa Department of Transportation (DOT). The DOT appeals the district court's denial of the DOT's motion for summary judgment. We determine the breach-of-contract claim instituted by Jerry, Larry, and Charlotte England (the Englands) is barred by their previous litigation. Accordingly, we reverse and remand for entry of summary judgment for the DOT.

I. Background Facts &Proceedings

The facts underlying this appeal were recited by this court in a 2019 decision:

The DOT owns the parcel of land at issue in this appeal. In 2016, the DOT decided to dispose of the parcel by auction. The DOT opened the auction to the owners of the three abutting pieces of property: Jon and Cheryl Simparcel, Kurt and Carol Anderson, and Jeffrey England. The DOT sent the owners of each abutting parcel a letter and a bidding form. The letter stated that "Iowa DOT policy allows a purchase preference for all abutting owner(s) of land to be sold." The letter stated it would give preference to bids that equaled or exceeded the fair market value of the parcel, which the DOT determined was $45,000. The bid form stated that to submit a valid bid the bidder must include a check with the returned form. The form also pre-printed $45,000 as the default bid amount: "I herewith submit an unconditional offer of $45,000 to the [DOT] for the purchase of the following land[.]" Finally, the form stated "The [DOT] reserves the right to waive any technicalities and to reject any or all bids or offers."

The Andersons returned a completed form. The bid form offered $45,000 and was accompanied by a check for the same amount. Jeffrey England also submitted a form. Jeffrey's bid form left the pre-printed bid amount of $45,000. However, Jeffrey's bid was accompanied by a check signed by his parents, Larry and Charlotte, in the amount of $51,016. After the Andersons learned another party was interested in the property, they increased their bid to $50,000. The bidding period then closed.

Subsequently, the DOT called Jeffrey. The exact substance of that phone call is not in the record. Jeffrey contends he was "informed he was the high bidder for the parcel." According to the agency, Jeffrey "was informed that the check from Larry and Charlotte England for $51,016 was the highest offer, and that there were discrepancies between the Offer to Buy Jeffrey England signed and the check received from Larry and Charlotte England." Jeffrey was also allegedly informed "the DOT would need to send a new Offer to Buy form to Larry and Charlotte England, to be signed so that the offer would match the check."

On the same day, the DOT also called Charlotte. It is unclear exactly what transpired during this phone call. According to the DOT, Charlotte was "informed of the discrepancies between the Offer to Buy that Jeffrey England signed and the check received from Larry and Charlotte England." She was also told "that [the DOT] would be mailing her paperwork, including a new Offer to Buy, to be signed by Larry and Charlotte England, so that the offer would match the check."

Finally, the DOT sent the Andersons a letter that explained that their bid was unsuccessful. The DOT also returned the Andersons' uncashed check.

Shortly after, the DOT attempted to mail Charlotte and Larry the original, voided bid form that Jeffrey had submitted. The DOT also sent a blank bid form and a note that said, "Cross off the amount of $45,000.00 and write in $51,016.00 above it and initial. Fill in name as Larry England and Charlotte England. Please sign and date as 3-18-16." However, because of a clerical error, the DOT inadvertently sent the forms to the Andersons instead of Charlotte and Larry.

After the Andersons were inadvertently mailed the letter intended for Larry and Charlotte, the Andersons' attorney contacted the DOT regarding the potential sale of the property. The Andersons raised concerns that the land was being sold to parties who were not abutting landowners. They requested "an opportunity for an open auction of the property with the abutting land owners identified in your disposal notice." In response to the Andersons' concerns, the DOT reviewed the matter and concluded that the sale of the land should not go forward. The DOT issued Charlotte and Larry a check refunding their payment. The DOT also sent letters to all abutting landowners, informing them that the sale would be cancelled and the DOT would reinitiate the bidding process at a later time.

In response, the Andersons and the Englands petitioned for a declaratory order. The Englands claimed the DOT was contractually bound to sell the land to Jeffrey or, in the alternative, the DOT was contractually bound to sell the land to Larry and Charlotte. The Andersons claimed they were the sole abutting landowners to place a valid bid and they were therefore entitled to the property.

In response, the DOT issued a declaratory order, determining that it had not erred in cancelling the auction and that it had not entered into an enforceable contract with Jeffery or Charlotte and Larry England. Both the Andersons and the Englands appealed to the district court. The district court affirmed.

Anderson v. State ex rel. Iowa Dep't of Transp., No. 17-1276, 2019 WL 1055720, at *1-2 (Iowa Ct. App. Mar. 6, 2019). On appeal, we affirmed. Id. at *1.

Our previous opinion noted that "[i]n the preprinted forms mailed to the potential bidders, the DOT made explicitly clear that it reserved the right 'to reject any or all bids and offers.' This reservation of rights was not qualified or limited in any respect." Id. at *3. Accordingly, "nothing in the solicitation prevented the DOT from canceling the auction.... That wholly discretionary decision was certainly within its purview." Id. Our court noted that the DOT lacked the authority to determine whether there was a valid contract between itself and another party. Id. at *2. Instead, "to the extent the parties seek a declaration of contract rights, their respective remedies lie in the district court and not within the very agency allegedly a party to the contract." Id.

The Englands initiated the instant action on November 19, 2019, filing a petition in district court. The petition claimed the DOT breached the contracts it made with both Jeffrey and with Charlotte and Larry. The Englands requested specific performance to convey the land. The DOT moved for summary judgment, alleging that the Englands' claim was barred by their previous lawsuit, which culminated in the Anderson decision.

The district court denied the DOT's motion for summary judgment. The court noted that, "[u]nder typical circumstances," it would find claim preclusion based on the decision of the district court in Anderson. However, the court found that the Englands "did not have a full and fair opportunity to litigate the claim in the district court proceeding" because of the more stringent evidentiary rules and because "the district court did not make independent or de novo findings." The DOT applied for interlocutory appeal and request for stay, which our supreme court granted.

II. Standard of Review

We review summary judgment rulings for corrections of errors at law. Villarreal v. United Fire &Cas. Co., 873 N.W.2d 714, 719 (Iowa 2016). "Summary judgment is appropriate only if no genuine issues of material fact exist and the moving party is entitled to judgment as a matter of law." Id.; see also Iowa R. Civ. P. 1.981(3). "[W]e examine the record in the light most favorable to the nonmoving party to determine if the moving party has met its burden." Pavone v. Kirke, 807 N.W.2d 828, 832 (Iowa 2011).

III. Discussion

The DOT asserts the Englands' claims are barred by the previous litigation that culminated in the Anderson decision. "The general rule of claim preclusion holds that a valid and final judgment on a claim bars a second action on the adjudicated claim or any part thereof." Id. at 835. The doctrine prevents a party from taking a "second bite" at the same litigation. Bennett v. MC No. 619, Inc., 586 N.W.2d 512, 517 (Iowa 1998). "[C]laim preclusion will apply 'not only to matters actually determined in an earlier action but to all relevant matters that could have been determined.'" Pavone, 807 N.W.2d at 835 (quoting Penn v. Iowa State Bd. of Regents, 577 N.W.2d 393, 398 (Iowa 1998)). Therefore, "[c]laim preclusion may preclude litigation on matters the parties never litigated in the first claim." Id.

A. Claim Preclusion &Agency Declaratory Orders

As a preliminary matter, the parties disagree on whether the administrative decision is entitled to a preclusive effect.^[1] Both parties cite Ghost Player, LLC v Iowa Department of Economic Development, 906 N.W.2d 454 (Iowa 2018). In that case, our supreme court recognized Iowa's adoption of section 83 of the Restatement (Second) of Judgments, which notes that administrative actions ordinarily do not carry preclusive effect unless they were made via processes that contain the "essential elements...