Leadbetter v. Rose

Citation467 N.W.2d 431
Decision Date19 March 1991
Docket NumberNo. 900200,900200
Parties66 Ed. Law Rep. 787 Mary LEADBETTER, Plaintiff and Appellant, v. Richard ROSE, Ph.D., Defendant, and University of North Dakota, Defendant and Appellee. Civ.
CourtUnited States State Supreme Court of North Dakota

Shirley A. Dvorak (appearance), Mack, Moosbrugger, Ohlsen, Dvorak & Carter, Grand Forks, for plaintiff and appellant. Argued by Leann Bertsch, 3rd Year Law Student.

Janet Seaworth (argued), Bismarck, for defendant and appellee. Appearance by Gary R. Thune, Sp. Asst. Atty. Gen., Bismarck.

ERICKSTAD, Chief Justice.

Mary Leadbetter appeals from a judgment dismissing, on the grounds of sovereign immunity, her action against the University of North Dakota [UND]. We affirm.

Leadbetter, a physiology student at UND, sued UND and Dr. Richard Rose, the chairman of the physiology department at UND, alleging that Rose sexually assaulted her while they were attending a meeting of the Federation of American Societies for Experimental Biology in New Orleans in March 1989. She alleged that UND breached its duty to investigate her complaint and to provide her with a safe school environment and supervisors. UND moved to dismiss Leadbetter's action on the grounds of sovereign immunity. The district court granted the motion, concluding that sovereign immunity barred Leadbetter's action against UND. Leadbetter appealed. 1

Leadbetter argues that UND is not an arm of the State of North Dakota and therefore sovereign immunity does not bar her action. UND responds that the State of North Dakota is the real party in interest.

When an action is essentially against the state to recover money, the state is the real party in interest and is entitled to invoke sovereign immunity even though it is not a named defendant. Kristensen v. Strinden, 343 N.W.2d 67 (N.D.1983). A court may look beyond the nominal parties to determine whether or not the state is the real party in interest. Id.

A majority of courts that have considered the relationship of a state university to its state have concluded that, for purposes of the Eleventh Amendment, 2 a suit against the university is a suit against the state. Durham v. Parks, 564 F.Supp. 244 (D.C.Minn.1983); Vaughn v. Regents of University of California, 504 F.Supp. 1349 (E.D.Cal.1981) and cases cited therein. The status of a state university depends upon the individual circumstances of each case. Durham, supra; Vaughn, supra.

The most important circumstance in determining the status of a state university is whether a judgment against that university will be paid from the state treasury. Durham, supra; Vaughn, supra. Other circumstances include: (1) whether the university is performing a governmental or proprietary function, (2) whether the university is separately incorporated, (3) whether the university can sue and be sued and enter into contracts, (4) whether the state controls the university's operations, and (5) whether the state has immunized itself from responsibility for the university's operations. Id. We examine the relationship of UND to the State of North Dakota.

N.D. Const., Art. VIII, Sec. 2, requires the Legislature to establish a uniform system of public schools, including schools of higher education.

N.D. Const., Art. VIII, Sec. 5, provides:

"All colleges, universities, and other educational institutions, for the support of which lands have been granted to this state, or which are supported by a public tax, shall remain under the absolute and exclusive control of the state...."

N.D. Const., Art. VIII, Sec. 6, provides, in relevant part:

"1. A board of higher education, to be officially known as the state board of higher education, is hereby created for the control and administration of the following state educational institutions, to wit:

"a. The state university and school of mines, at Grand Forks, with their substations.

* * * * * *

"2. a. The state board of higher education shall consist of seven members, all of whom shall be qualified electors and taxpayers of the state, and who shall have resided in this state for not less than five years immediately preceding their appointment, to be appointed by the governor, by and with the consent of the senate, from a list of names selected as hereinafter provided."

See also Sections 15-10-01 and 15-10-02, N.D.C.C.

The State Board of Higher Education is a part of the executive branch of government. See Nord v. Guy, 141 N.W.2d 395 (N.D.1966). The appointment of the Board of Higher Education by the governor with the consent of the Senate is indicative of the State's retention of a measure of control over the governing body of UND. See Vaughn, supra, 504 F.Supp. at 1353. The State's control over the Board is further demonstrated by the Legislature's requirement for the Board to make biennial reports to the governor and the office of management and budget about enrollments, major functions and programs, major goals and objectives, and finances. Section 15-10-14.1, N.D.C.C. The Board is also required to obtain approval of the budget section of the legislative council to construct buildings and campus improvements which are financed by donations, gifts, grants, and bequests. Section 15-10-12.1, N.D.C.C. The Board may not spend more money than appropriated by the Legislature for the erection or improvement of any public building, or structure, or for the purchase of any real property [Section 54-27-12, N.D.C.C.], or divert money appropriated by the Legislature for one institution to another institution. Section 15-10-16, N.D.C.C. The members of the Board are compensated by the State for time actually devoted to the duties of the office and receive necessary expenses "in the same manner and amounts as other state officials." Section 15-10-08, N.D.C.C.

Although the Board has authority over some aspects of UND [Section 15-10-11, N.D.C.C.], our constitution and statutes indicate that UND ultimately remains under the control of the State. Compare Durham, supra, 564 F.Supp. at 248, ["Minnesota constitution has significantly put the University [of Minnesota] out of reach of the control of the state"].

Leadbetter also asserts that UND generates revenue from sources other than legislative appropriations and that a judgment against UND "need not and in fact most likely would not come from the state treasury." However, UND relies upon some legislative appropriations for its support and to the extent that any judgment obtained by Leadbetter would be satisfied out of funds derived from those appropriations, that judgment would be from the State treasury. Vaughn, supra. Moreover, we agree with Vaughn, supra, that the proper inquiry is whether any judgment will have to be paid out of the State treasury or other sources of State funds; i.e., funds otherwise available to the State. Section 15-10-12, N.D.C.C., provides that "[a] special revenue fund, for each institution of higher education under the control of the [state] board [of higher education] or subject to its administration, shall be maintained within the state treasury and all institutional income and institutional collections of public funds of each institution ... shall be placed in the special fund for the use of the institution for which the money was raised." Money received by UND is part of the State fund for use by UND. Any judgment against UND would therefore come from the State treasury or other sources of State funds.

These factors lead us to conclude that UND is an arm of the State of North Dakota and is therefore entitled to invoke sovereign immunity as a bar to Leadbetter's lawsuit.

Leadbetter argues that this court should abrogate or modify the doctrine of sovereign immunity. She contends that the original reasons for the doctrine no longer exist and that no sufficient reason exists to retain it. Relying on Kitto v. Minot Park District, 224 N.W.2d 795 (N.D.1974), she asserts that because sovereign immunity is a product of judicial origin, this court may abrogate or modify it.

Art. I, Sec. 9, N.D. Const., provides:

"All courts shall be open, and every man for any injury done him in his lands, goods, person or reputation shall have remedy by due process of law, and right and justice administered without sale, denial or delay. Suits may be brought against the state in such manner, in such courts, and in such cases, as the legislative assembly may, by law, direct."

In Kitto, this court, within certain limits, abolished the judicial doctrine of immunity for governmental bodies. We held that governmental bodies, other than the State, could be sued for damages for negligence, wrongful acts, or omissions of their agents and employees. We defined governmental bodies as counties, townships, park districts, school districts, cities, and other local governmental or political subdivisions. In analyzing the extent to which governmental immunity was based upon the predecessor of Art. I, Sec. 9, N.D. Const., we said that "a reconsideration of the constitutional basis for governmental immunity establishes that this doctrine, as distinguished from sovereign immunity of the state itself, is not constitutionally mandated." Kitto, supra, 224 N.W.2d at 801. Kitto was thus specifically limited to governmental immunity and not sovereign immunity.

In Senger v. Hulstrand Construction, Inc., 320 N.W.2d 507 (N.D.1982), this court considered whether or not sovereign immunity could be judicially abrogated. We observed that Art. I, Sec. 9, N.D. Const., had been consistently construed as giving the Legislature the power to modify or waive sovereign immunity. In analyzing that constitutional provision and its effect on the abrogation or modification of sovereign immunity, we considered Mayle v. Pennsylvania Dept. of Highways, 479 Pa. 384, 388 A.2d 709 (1978), and Worthington v. State, 598 P.2d 796 (Wyo.1979), and construed

"Article I, Sec. 9, of the North Dakota Constitution as a delegation to the Legislature of the power to regulate the State's [amenability...

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