Saba v. Counties of Barnes, Benson, Burleigh, Eddy, Foster, Griggs, Kidder, Nelson, and Wells

• Decision Date: 30 June 1981
• Docket Number: No. 9866,9866
• Citation: 307 N.W.2d 590
• Parties: Naif SABA and Ruth Mourhess, on behalf of themselves and all other residents and property owners in the City of Bismarck, County of Burleigh, and State of North Dakota similarly situated, Plaintiffs and Appellants, v. COUNTIES OF BARNES, BENSON, BURLEIGH, EDDY, FOSTER, GRIGGS, KIDDER, NELSON, ANDWELLS, and Weather Modification, Inc., a domestic corporation, Defendants andAppellees. Civ.
• Court: North Dakota Supreme Court

Page 590

307 N.W.2d 590

Naif SABA and Ruth Mourhess, on behalf of themselves and all other residents and property owners in the City of Bismarck County of Burleigh, and State of North Dakota similarly situated, Plaintiffs and Appellants, v. COUNTIES OF BARNES, BENSON, BURLEIGH, EDDY, FOSTER, GRIGGS KIDDER, NELSON, ANDWELLS, and Weather Modification, Inc., a domestic corporation, Defendants andAppellees.

Civ. No. 9866.

Supreme Court of North Dakota.

June 30, 1981.

Fintan L. Dooley, Bismarck, for plaintiffs and appellants.

John M. Olson, State's Atty., Bismarck, for Counties of Barnes, Benson, Burleigh, Eddy, Foster, Griggs, Kidder, and Nelson.

Robert V. Bolinske, of Zuger & Bucklin, Bismarck, for Wells County.

Christine Hogan, of Pearce, Anderson & Durick, Bismarck, for Weather Modification, Inc.

VANDE WALLE, Justice.

The plaintiffs appealed from an order of the district court of Burleigh County denying their motion to have their cause of action certified as a class action pursuant to Rule 23, N.D.R.Civ.P. ¹ We affirm.

This action originally was commenced by Saba against the City of Bismarck. In the first complaint Saba alleged the City was negligent for failing to maintain proper sewers and that as a result of its negligence his property was damaged by a rain storm which occurred in the Bismarck vicinity on July 31, 1975. Subsequently Mourhess was added as a party plaintiff and an amended complaint was filed naming the City and Weather Modification, Inc., as defendants. The second complaint appeared to allege that Weather Modification, Inc., had improperly seeded the clouds over the city on July 31, 1975. The City was subsequently dismissed from the action on motion of the plaintiff, and two additional complaints were filed. The last complaint, entitled "Third Amended Complaint," with which we now are concerned, names the nine counties and Weather Modification, Inc., as defendants. The gist of that complaint is that the defendants negligently seeded or caused to be seeded the clouds over the city of Bismarck, thereby causing the heavy rains which resulted in damage to the plaintiffs' properties. The third cause of action in that complaint is a request that the action be certified as a class action. The allegations of that portion of the third amended complaint are as follows:

"XXVII.

"That the City of Bismarck during said flood had a population of several thousand people.

"XXVIII.

"That said flood caused persons and businesses to lose property in the same fashion as plaintiff.

"XXIX.

"That plaintiffs bring their action in their representative capacity for the benefit of all persons described hereabove.

"XXX.

"That plaintiff brings his action in his representative capacity for the benefit of all persons described hereabove.

"XXXI.

"That such persons are so numerous that joinder here of all is impracticable and this action is accordingly brought as a class action.

"XXXII.

"The questions of liability of the Defendants are questions of law and fact common to the class.

"XXXIII.

"That the value of losses of all in the class is estimated to be in the vicinity of 6 million dollars.

"WHEREFORE the Plaintiff prays for judgment in behalf of all the class declaring that the liability of the Defendant covers all the damages sustained by the class and its members.

"WHEREFORE the plaintiff prays that the cost of giving notice to members of the class be imposed upon the Defendants.

"WHEREFORE the plaintiff prays that the damage due each member in the class be determined by a special master whose costs and disbursements be paid by the Defendants."

Pursuant to Rule 23(b), N.D.R.Civ.P., the district court held a hearing to determine whether or not the action was to be maintained as a class action and subsequently issued its order refusing to certify the action as a class action. The trial court concluded that the proceeding should not be certified as a class action "because other means of adjudicating the claims and defenses are not impracticable or inefficient, and also because a class action at this stage does not offer the most appropriate means of adjudicating the claims and defenses."

On appeal the plaintiffs have raised two issues:

1. Did the trial court abuse its discretion in refusing to conditionally certify the case as a class action?

2. Did the trial court err by not authorizing solicitation to provide funds for payment of costs under Rule 23(q)(2), N.D.R.Civ.P.?

Inherent in the plaintiffs' first issue is the acknowledgment that on appeal from an order of the trial court refusing to certify a proceeding as a class action our standard of review is to determine if the trial court abused its discretion in entering such an order. We have defined an "abuse of discretion" by the trial court as an unreasonable, arbitrary, or unconscionable attitude on the part of the trial court. In Interest of F. H., 283 N.W.2d 202, 209 (N.D.1979); Wall v. Pennsylvania Life Insurance Co., 274 N.W.2d 208 (N.D.1979).

Although this court recognized the abuse-of-discretion standard in appeals of orders certifying or refusing to certify actions as class actions, the court has also indicated that it would not hesitate to overrule and reverse determinations denying class-action status in order to accomplish the remedial objectives of the class-action rule. Rogelstad v. Farmers Un. Grain Ter. Assn., 226 N.W.2d 370 (N.D.1975). In Rogelstad this court indicated that decisions as to whether or not class-action status should be allowed seem to rest on judicial philosophy rather than on precedent or statutory language. The court stated it would interpret Rule 23 "so as to provide an open and receptive attitude toward class actions." 226 N.W.2d at 376.

The Rogelstad court was construing a rule identical to Rule 23 of the Federal Rules of Civil Procedure. Since that time we have revised Rule 23. We do not, however, determine that the philosophy of Rule 23 as it existed when it was identical to the Federal rule or as it exists now is different.

I

Rule 23(b)(2) permits the trial court to certify an action as a class action if it finds that the class is so numerous or so constituted that joinder of all members, whether or not otherwise required or permitted, is impracticable; there is a question of law or fact common to the class; a class action should be permitted for the fair and efficient adjudication of the controversy; and the representative parties will fairly and adequately protect the interests of the class. Rule 23(c)(1) lists several criteria to be considered by the trial court in determining if the class action should be permitted for the fair and efficient adjudication of the controversy. The trial court's memorandum opinion and order reflects its consideration of these criteria. The opinion makes specific reference to the provision (subsection (c) of Rule 23) which lists the criteria and the trial court's discussion of these criteria leave us with no doubt that the required criteria were recognized and considered by the trial court.

The trial court indicated that had the lawsuit been commenced originally as a class action, it would have been much more inclined to grant certification. The memorandum opinion and order notes that there was no indication that the rain had caused a deluge of claims and that the only known claims are those of the plaintiffs and one other person. The trial court concluded that those claims could easily be handled by utilizing normal procedures. We do not agree that a lack of known claims is a sound basis for refusing to certify a class. In Rogelstad the court specifically rejected that basis for refusing to permit maintenance of a class action "The fact that there is but one party plaintiff and no other persons have sought to intervene and no other independent actions have been commenced is not determinative as to the feasibility of permitting the maintenance of a class action." Syllabus by the Court P 2, 226 N.W.2d at 371.

There is, however, a more significant basis for the trial court's decision reflected in the memorandum opinion and order from which this appeal is taken:

"Although there may be a common question of law and fact as to the legal liability of the counties and as to whether or not the rain-making actually caused an increase in the rain, there are very difficult and disparate individual questions of damages. Each person would have individual damages. It is not, as in antitrust proceedings, a situation in which once the violation is established, the damages become a matter of accounting based upon records of purchases. Ultimately, therefore, individual members of the prospective class would be required to come forward and actively participate in the suit in order to establish their particular damages. Put another way, in the end the lawsuits would be individualized."

In Rogelstad this court considered a similar issue and, in Syllabus by the Court P 3, stated:

"Where the contentions of the named plaintiff and the potential plaintiffs are similar and involve legal questions as to the right of the class plaintiffs to recover, and these issues predominate over separate questions affecting individual members, and a class action is superior to other available methods for the fair and efficient adjudication of the controversy, it is an abuse of discretion for the trial court to deny class action status." 226 N.W.2d at 371-372.

After outlining the common questions of fact and the common question of law, the court in Rogelstad determined that under the facts of that case either the defendant would be entitled to a decision in its favor or the class-action plaintiffs would need only to prove their individual damages. However, the damages in Rogelstad would be determined by an examination of the records because the complaint alleged usury on the part of the defendant. In this instance, as the trial court noted, the damages do not become a matter of accounting based upon...