Reid v. Steelman

• Decision Date: 24 October 2006
• Docket Number: No. WD 65821.,WD 65821.
• Citation: 210 S.W.3d 273
• Parties: Margo REID, Appellant, v. Sarah STEELMAN, et al., Respondents.
• Court: Missouri Court of Appeals

210 S.W.3d 273

Margo REID, Appellant, v. Sarah STEELMAN, et al., Respondents.

No. WD 65821.

Missouri Court of Appeals, Western District.

October 24, 2006.

Motion for Rehearing and/or Transfer to Supreme Court Denied December 19, 2006.

Application for Transfer Denied January 30, 2007.

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J. Brian Baehr, Columbia, MO, for appellant.

Jeremiah W. (Jay) Nixon, Atty. Gen., Douglas Leyshock, Assistant Attorney General, Jefferson City, MO, for respondents.

Before BRECKENRIDGE, P.J., and HOWARD and HOLLIGER, JJ.

VICTOR C. HOWARD, Judge.

Margo Reid sought declaratory relief compelling the State of Missouri to pay from the Missouri State Legal Expense Fund ("SLEF") damages from the settlement of an action against a former employee of the Missouri Department of Health. Reid appeals the Cole County circuit court's grant of the State's motion to dismiss the current action, because she contends the court erred in deciding on the grounds of res judicata that a prior declaratory judgment determined that the State was not obligated to pay.

In February 2001, Reid was involuntarily committed due to mental illness to the Guhleman Forensic Center at the Fulton State Hospital and operated by the Missouri Department of Mental Health ("DMH"). While a resident there, she was sexually abused on multiple occasions by Patrick Downey, a DMH security aide. The abuse occurred at Guhleman Forensic Center while Downey was on duty. After investigation of these incidents, DMH terminated Downey's employment on July 6, 2001, on the grounds that his actions constituted sexual abuse of a client in violation of the employee handbook. On September 6, 2001, Reid sued Downey, among others, in the United States District Court, Western District of Missouri, alleging Downey and the Guhleman Center violated her civil rights under 42 U.S.C. § 1983.

On January 13, 2003, Downey requested that the Missouri Attorney General assume his defense in the litigation pursuant to section 105.711.¹ Section 105.711 creates the SLEF, and states in pertinent part:

1. There is hereby created a "State Legal Expense Fund" which shall consist of moneys appropriated to the fund by the general assembly and moneys otherwise credited to such fund pursuant to section 105.716.

2. Moneys in the state legal expense fund shall be available for the payment of any claim or any amount required by any final judgment rendered by a court of competent jurisdiction against:

....

(2) Any officer or employee of the state of Missouri or any agency of the state, including, without limitation, elected officials, appointees, members of state boards or commissions, and members of the Missouri national guard upon conduct of such officer or employee arising out of and performed in connection with his or her official duties on behalf of the state, or any agency of the state, ...

....

5. All payments shall be made from the state legal expense fund by the commissioner of administration with the approval of the attorney general.....

....

The state legal expense fund shall be the exclusive remedy and shall preclude any other civil actions or proceedings for money damages arising out of or relating to the same subject matter against the state officer or employee, or the officer's or employee's estate. No officer or employee of the state or any agency of the state shall be individually liable in his or her personal capacity for conduct of such officer or employee arising out of and performed in connection with his or her official duties on behalf of the state or any agency of the state.....

(Emphasis added). Section 105.716.1 provides: "Any investigation, defense, negotiation, or compromise of any claim covered by sections 105.711 to 105.726 shall be conducted by the attorney general[.]" Cates v. Webster, 727 S.W.2d 901, 904 (Mo. banc 1987). For coverage to apply, it must be shown that: "(1) [the actor] was an officer or employee of the state or any agency thereof; and (2) the claim is against conduct which arose out of and was performed in connection with [the actor's] official duties on behalf of the state or any agency thereof." Id.

In response to his request, the Attorney General notified Downey on January 17, 2003, that the State would not represent him and that the SLEF was not obligated to pay any claim resulting from a judgment against Downey. The Attorney General found the sexual abuse did not arise out of Downey's official duties nor was it committed in connection with official duties. Furthermore, while Reid's federal civil lawsuit was pending, the Attorney General, Jay Nixon, and the Commissioner of Administration, Jacqueline White,² filed a petition for declaratory judgment in the circuit court of St. Francois County against both Reid and Downey. Nixon sought judgment declaring Missouri was not required to represent Downey or pay from the SLEF a judgment or settlement issued against Downey.

Reid's attorney timely answered the petition, denying that she had knowledge of Downey's dismissal from employment and that his actions were not within the scope of his employment. On October 27, 2003, the Attorney General filed a motion for summary judgment, contending that DMH's determination of the facts that led to Downey's firing supported that "Downey's conduct did not arise out of and was not performed in connection with his official duties on behalf of the State of Missouri or an agency thereof." He further requested that those facts be used to determine that the SLEF be adjudged not liable for potential monetary judgment in the ongoing federal action.

In her response to the motion filed on December 8, 2003, Reid contended that a genuine issue of material fact existed as to whether Downey's conduct fell within the scope of his job, since his actions "occurred while he was employed by and under the direct supervision of the state; at a State mental facility; in the capacity of jailer-custodian; and while he was `on the clock.'" The response further contended that Reid should not be bound by the determinations of DMH as to whether Downey's conduct was beyond the scope of his employment because she was not a party to the proceedings finding grounds for Downey's dismissal from employment. Reid did not challenge the subject matter jurisdiction of the court or protest that the issues were not ripe for review.

On March 3, 2004, the St. Francois County circuit court granted the Attorney General's motion for summary judgment, and without elaborating on the grounds for that decision, stated:

Upon review of plaintiffs' Motion for Summary Judgment and after opportunity for all parties to be heard on said motion, the Court enters judgment in plaintiffs favor. The Court hereby declares that pursuant to § 105.711 et seq. RSMo 2000, the Missouri Attorney General has no statutory duty to assume the defense of claims asserted by defendant Reid against defendant Downey in Reid v. Downey, et al., 2:01-4185-CV-C-SOW; (2), a federal lawsuit now pending in the Western District Court of Missouri. The Court further declares that neither the Missouri Attorney General nor the Commissioner of Administration have any obligation to expend or authorize the expenditure of any monies from the Missouri Legal Expense Fund for payment of any settlement or judgment resulting from claims asserted against defendant Downey by defendant Reid in cause number 2:01-4185-CV-C-SOW.

On March 25, 2004, Reid filed a motion to set aside the summary judgment, contending that her attorney had failed to appear at a rescheduled hearing on the motion for summary judgment on February 27, 2004, because he received information from the circuit court that the hearing had been cancelled. That motion was denied.³ Reid did not appeal the decision.

Reid's federal civil rights lawsuit against Downey was settled, and on September 16, 2004, the United States District Court ordered judgment in favor of Reid in the amount of $200,000. In its order, the District Court referenced the stipulation of facts and consent to judgment signed by both parties, which said in pertinent part:

3. During said time [while Reid was committed to the Guhleman Center of the Fulton State Hospital], [Downey] was employed by the State of Missouri in the capacity of security aid[e] at the Guhleman Center.

4. During said time, [Downey] on three occasions engaged in sexual activity with [Reid] on the premises of the Guhleman Center while he was on duty.

5. These incidents ultimately resulted in the termination of [Downey's] employment by the State of Missouri for sexual abuse of [Reid].

6. [Downey's] sexual activity with [Reid] arose out of and was performed in connection with his official duties on behalf of the State of Missouri.

7. [Downey's] conduct with respect to [Reid] was performed under color of law.

8. [Downey's] conduct with respect to [Reid] shocks the conscience and violated [Reid's] substantive due process right to bodily integrity under the 14th Amendment to the United States Constitution.

On November 24, 2004, Reid filed a demand with the State for the payment of the $200,000 judgment from the SLEF. The demand was denied. On February 23, 2005, Reid filed a petition for declaratory judgment in Cole County, naming the State Treasurer, Sarah Steelman, and Commissioner of Administration of the State of Missouri, Michael Keethley,⁴ seeking payment for the judgment, arguing that she had met all the requirements under Section 105.711 for payment.

In response, the Attorney General filed a motion to dismiss Reid's petition, on the grounds that the action was barred by the doctrine of res judicata. The motion argued that the identity of the thing sued for, the cause of action, the parties to the action, and the quality of the person against whom the claim is made are identical to the issues addressed in the prior declaratory action, brought by the Attorney General in St. Francois County circuit court ...