Gilbertson v. City of Fairbanks

• Decision Date: 18 February 1959
• Docket Number: No. 15567,16017.,15567
• Parties: George GILBERTSON, Appellant, v. CITY OF FAIRBANKS, a municipal corporation, Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

262 F.2d 734 (1959)

George GILBERTSON, Appellant, v. CITY OF FAIRBANKS, a municipal corporation, Appellee.

Nos. 15567, 16017.

United States Court of Appeals Ninth Circuit.

January 12, 1959.

Rehearing Denied February 18, 1959.

Edgar Paul Boyko, Los Angeles, Cal., Boyko, Talbot & Tulin, Anchorage, Alaska, for appellant.

Edward A. Merdes, William Boggess, Fairbanks, Alaska, George N. Sheild, San Francisco, Cal., for appellee.

Before HEALY, HAMLEY and JERTBERG, Circuit Judges.

JERTBERG, Circuit Judge.

On August 23, 1956, appellee (plaintiff below) filed a complaint against appellant (defendant below), hereinafter for convenience sometimes respectively referred to as plaintiff or defendant and as appellant or appellee, in which plaintiff sought judgment in the sum of $5,146.25, claimed to be the reasonable value of certain utilities furnished to defendant's hotel by plaintiff, in its capacity as the owner and operator of an electric, telephone, steam heat, and water utility system. Defendant's answer denied the material allegations of the complaint, and asserted a counterclaim in two counts for damages in the amount of $100,000. In the first count of the counterclaim, defendant alleges that on or about July 14, 1952, he was the owner and operator of a certain building known as the Pioneer Hotel, together with furniture and other effects contained therein; that the plaintiff was engaged in the business of furnishing electricity as a public utility to customers at Fairbanks, Alaska, including said hotel; that on or about said date a fire was started in said building, which said fire was brought under control and confined to a small portion of defendant's said building by various fire fighting agencies; that the pumps furnishing water used by said fire fighting agencies were operated on electric current furnished by plaintiff, and after said fire had been brought under control plaintiff, by its agents or employees, carelessly and negligently caused to be turned off the electric current being supplied to said water pumps, as a result of which the said fire fighting forces were deprived of water, whereby the said fire again went out of control, completely destroying defendant's said building, together with furniture and other effects, to the defendant's damage in the sum of $100,000.

The second count of the counterclaim is based upon a breach by plaintiff of an alleged contractual obligation on the part of plaintiff to furnish adequate fire protection for defendant's property, by reason of the payment of taxes.

On October 23, 1956, plaintiff filed a motion to dismiss both counts of the counterclaim on the ground of non-liability of the City of Fairbanks by reason of its municipal immunity from suit, as well as the statute of limitations. The district court entered an order dismissing both counts of said counterclaim on the ground of non-liability of the city from suit, but did not pass on the statute of limitations defense asserted by the city against the counterclaim because the trial court was of the opinion that dismissal on the first ground was dispositive of the counterclaim. The opinion of the trial court dismissing the counterclaim appears in 16 Alaska 590. Defendant appealed from said order to this Court, and the appeal was docketed as cause 15,567. On February 24th this Court, on its own motion, dismissed the appeal without prejudice on the ground that the order appealed from was not a final judgment because of noncompliance with the requirements of Rule 54(b) of the Federal Rules of Civil Procedure, 28 U.S.C.A. The opinion of this Court is reported in 253 F.2d 231.

Thereafter, the defendant filed in the district court his motion for rehearing, and to revise the opinion and order of dismissal, or, in the alternative, for entry of a final judgment of dismissal under Rule 54(b) of said Rules. The district court denied the motion for rehearing and entered on March 3, 1958, its final order and judgment of dismissal of both counts contained in defendant's counterclaim without leave to amend. In said order the district court made the finding required by Rule 54(b) to the effect that "there is no just reason for delay in entering final judgment."

The defendant appealed to this Court from the last mentioned final order and judgment. This cause was docketed in this Court as number 16,017, and thereafter this Court ordered the records on appeal in causes numbers 15,567 and 16,017 consolidated.

The specifications of error relied on by the defendant on the consolidated appeals, as summarized in appellant's brief, are as follows:

1. Where a municipal corporation operates both an electrical utility and a fire department and the electrical utility, through its agents or employees, tortiously interferes with operations of such fire department and other fire fighting agencies protecting the property of a private citizen, by the careless and negligent cutting off of electrical current which furnishes the needed power to pumps supplying water to such municipal and other fire fighting agencies, is the municipality liable to the property owner by virtue of its negligent operation of its proprietary electrical utility department and its tortious interference with processes of fire protection, or is such municipality immune from suit by virtue of the governmental status of its fire protection activities and those of other agencies, to whom both the water and, incidentally, the electricity so cut off was being furnished?

2. Should the District Court have submitted to the jury the issue of whether the alleged negligent and careless acts of the electrical utility or its agents constituted such intentional or tortious interference with the fire protection being rendered to appellant's property as to allow him to recover for the damages sustained?

3. Since cities in Alaska must derive any claimed immunity from the sovereign which created them, namely, the United States, was their alleged legal irresponsibility lost when the United States waived its immunity from suit for like misconduct by its agents or employees, through enactment of the Federal Tort Claims Act, as recently interpreted by the Supreme Court of the United States?

4. If, as appellant believes, the decision of the District Court here appealed from was based squarely upon the issue of municipal immunity, no amendment of the counterclaim was necessary. However, if amendment be required for the purpose of alleging additional facts necessary to bring the pleadings within the precedents relied on by appellant, did the District Court abuse its discretion in refusing appellant's prayer for leave to amend?

We will consider these specifications of error ad seriatim. First, appellant contends that the district court erred in holding as a matter of law that the appellee was not liable for acts of negligence alleged in appellant's counterclaim because of appellee's municipal immunity from suit. The trial court stated that a municipality functions in a proprietary or corporate capacity in the operation of a public utility, such as the generation and distribution of electric power, and that a municipality is normally liable for damages resulting from the negligent operation of such public utility to the same extent as a private person or corporation engaged in such business. The trial court held, however, that the appellee, in providing the electrical energy which pumped the pumps which in turn provided the water to the fire fighting forces, was engaged in the performance of a governmental function and, therefore, the appellee was not liable in damages to the appellant for any negligence of the appellee in failing to supply the electrical energy.

Under this specification of error, appellant contends that in furnishing electrical energy to the pumps which supplied the water to the fire fighting forces appellee was engaged in a proprietary function and is, therefore, liable to the appellant for damages caused by employees of appellee in the performance of that function.

The law is well established in the Territory of Alaska, as it is elsewhere, that a municipality is not liable to suit for damages caused by the negligence of its police officers in performing a governmental function. Wilson v. Eberle, 15 Alaska 260, and cases therein cited. Fire fighting has always been considered a governmental function and municipal immunity from suit based upon negligence of the employees of the municipality while engaged in fire fighting has long been established and recognized.¹ Such immunity was impliedly recognized by the Territorial Legislature of Alaska.²

The prevailing view is that no municipal liability exists in the negligent failure to supply water for extinguishment of fire, even though the same water system might be used by the municipality in a proprietary way to furnish water to the general public. The essence of the charge against the municipality in such type of case is the municipality's failure to properly extinguish the fire, which is a governmental function.³ This rule has been applied even where the act of the city employee was wilfull and with full knowledge that the water which he turned off was being used for fire fighting. Miralago Corp. v. Village of Kenilworth, 1937, 290 Ill.App. 230, 7 N.E.2d 602.

On the other hand, it has generally been held that when a municipality engages in the business of a public utility, to-wit, providing electricity to the general public, it is acting in a proprietary or corporate capacity and, therefore, is subject to liability even if, incidentally, electricity is also supplied to the city for a governmental purpose.⁴

The appellant has called our attention to only one case, however, involving the failure to supply electrical energy to the fire fighting forces of a municipality. The case is Highway Trailer Co. v. Janesville Electric Co., 1922, 178 Wis. 340, 190 N.W. 110, 27 A.L.R. 1268. That case involved the liability of a...