SHASTA VIEW IRRIGATION v. Amoco Chemicals

• Decision Date: 29 July 1999
• Citation: 986 P.2d 536,329 Or. 151
• Parties: SHASTA VIEW IRRIGATION DISTRICT, a municipal corporation, Plaintiff, v. AMOCO CHEMICALS CORPORATION; Amoco Chemical Company, a corporation a/k/a Amoco Chemical Corp; Amoco Reinforced Plastics Company, Defendants.
• Court: Oregon Supreme Court

986 P.2d 536

329 Or. 151

SHASTA VIEW IRRIGATION DISTRICT, a municipal corporation, Plaintiff, v. AMOCO CHEMICALS CORPORATION; Amoco Chemical Company, a corporation a/k/a Amoco Chemical Corp; Amoco Reinforced Plastics Company, Defendants.

(USDC CV9403064-JPC; USCA 96-35869; SC S44723)

Supreme Court of Oregon.

Argued and Submitted May 7, 1998.

Decided July 29, 1999.

James M. Duncan, of Perlman & Duncan, Bakersfield, California, filed the brief and argued the cause for plaintiff. With him on the brief was Stanley C. Jones, Jr., of Boivin Jones Uerlings DiIaconi & Oden PC, Klamath Falls.

Roy Pulvers, of Lindsay, Hart, Neil & Weigler, LLP, Portland, argued the cause for defendants. With him on the brief were Jerard S. Weigler, Portland, and Randall S. Henderson, Pasadena, California.

Jas. Adams, Assistant Attorney General, Salem, filed a brief for amicus curiae State of Oregon. With him on the brief were Hardy Myers, Attorney General, and Michael D. Reynolds, Solicitor General.

James N. Gardner, of Gardner & Gardner, Portland, and William N. Stiles, of Sussman Shank Wapnick Caplan & Stiles, LLP, Portland, filed a brief for amici curiae Associated Oregon Industries, Pharmaceutical Research and Manufacturers of America, and Oregon-Columbia Chapter of the Associated General Contractors of America, Inc.

Before CARSON, Chief Justice, and GILLETTE, VAN HOOMISSEN, DURHAM, KULONGOSKI, and LEESON, Justices.

LEESON, J.

This case is before the court on certified questions of Oregon law from the United States Court of Appeals for the Ninth Circuit under ORS 28.200 et seq. and ORAP 12.20. We take the following facts from the Ninth Circuit's certification order:

"Shasta View Irrigation District (`Shasta') was organized and formed on December 5, 1917, pursuant to Chapter 357 of the Oregon Laws of 1917, now Chapter 545 of the Oregon Revised Statutes. There are approximately fifty-six individual members of Shasta. These members own irrigable land within the geographic boundaries of Shasta, and farm or lease their land to others.

"Under a rehabilitation and betterment project proposed by Shasta, over twenty-one miles of existing unlined canals were to be replaced with approximately seventeen miles of buried pressure pipeline. In April 1972, Shasta entered into a contract with the United States Bureau of Reclamation. The contract provided that the United States would loan up to $3.222 million to Shasta for the rehabilitation and betterment of the irrigation system. The term of the loan was sixty-five years.

"In April 1973, Shasta released the bid specifications for the project. The specifications provided, among other things, that the pressure pipe used in constructing the irrigation system must last for the sixty-five year term of the loan.

"In June 1973, Shasta entered into a contract for construction of the pressurized irrigation system. The pipe installation contractor elected to use two different types of pressure pipe in constructing the system: Techite, a brand of reinforced plastic mortar pipe manufactured by Amoco Reinforced Plastics Co. [Amoco] was used in approximately 50,000 feet of the system and an asbestos-cement pipe manufactured by Certainteed Products Corp. was used in approximately 38,000 feet of the system.

"The Techite was ordered from Amoco * * * between June and September 1973. Installation of the pipe began in February 1974 and was completed by June of that year. In July 1975, Shasta accepted the irrigation system as complete and operational.

"According to Shasta, the Techite pipe has failed approximately twenty-six times, beginning in 1978, with two of the failures occurring before July 1, 1982. On February 16, 1989, Shasta's board of directors voted in favor of pursuing legal action against the manufacturer of the Techite pipe. In 1994, Shasta filed the present action in Oregon superior court [sic], alleging strict product liability, negligence, breach of express warranty and fraud/misrepresentation.

"After removing the action to federal district court on the basis of diversity of citizenship, Amoco filed a motion for summary judgment, claiming that all of Shasta's claims were statutorily time barred. The district court granted summary judgment in favor of Amoco, finding that Shasta was not a `public corporation' for purposes of statutory time limitations and that, therefore, all of Shasta's claims were time barred by Oregon's Product Liability statutes. [Shasta] timely appealed."

The Ninth Circuit certified the following two questions to this Court:

"1. Is an irrigation district a `public corporation' for purposes of applying the exemption to applicable limitations set out in [ORS] 12.250? If an irrigation district is a `public corporation' under [ORS] 12.250, then:

"2. Does [ORS] 12.250's exemption to applicable limitations apply to [ORS] 30.905(1), a statute of ultimate repose outside of [ORS] chapter 12?"

We accepted certification of those questions and, at that time, added an additional question:

3. "If ORS 12.250 does not apply to ORS 30.905(1), then is there a common-law variation of ORS 12.250 that would apply to ORS 30.905(1) to make Shasta's action timely?"

See Western Helicopter Services v. Rogerson Aircraft, 311 Or. 361, 370-71, 811 P.2d 627 (1991)

(court has discretion to reframe questions presented). We address the questions in order.

CERTIFIED QUESTION NO. 1:

"Is an irrigation district a `public corporation' for purposes of applying the exemption to applicable limitations set out in [ORS] 12.250?"

ORS 12.250 provides:

"Unless otherwise made applicable thereto, the limitations prescribed in this chapter shall not apply to actions brought in the name of the state, or any county, or other public corporation therein, or for its benefit."

(Emphasis added.) Shasta contends that the legislature has recognized the public nature of irrigation districts and that several statutes "confirm the general proposition that Oregon law treats irrigation districts like other [public] corporations." Furthermore, Shasta argues, there is no evidence in ORS 12.250 that the legislature intended not to extend the protection of ORS 12.250 to irrigation districts. Amoco replies that the text and context of ORS 12.250 leads to the "inescapable conclusion that irrigation districts are not one of the `other public corporation[s]' entitled to an exemption within the meaning of that statute." To answer the first certified question, we must construe the phrase, "other public corporation therein."¹ The starting point of our analysis is the text and context of the statute, giving words of common usage their plain, natural, and ordinary meaning. See PGE v. Bureau of Labor and Industries, 317 Or. 606, 610-11, 859 P.2d 1143 (1993)

(describing statutory construction methodology).

The term "public corporation" is not a term of common usage, and neither the statute nor ORS chapter 12 defines the term. However, this court has held that a public corporation is a corporation formed for the public's benefit or for a public purpose. See State ex rel Eckles v. Woolley, 302 Or. 37, 48-49, 726 P.2d 918 (1986)

(so stating); see also Black's Law Dictionary, 1228 (6th ed 1990) (defining public corporation as a municipality or government corporation "created for the administration of public affairs"). This court also has held that "[t]he concept of a `public corporation' covers a wide variety of institutions," including municipal corporations. Eckles,

302 Or. at 47,

726 P.2d 918.

Two words of common usage in ORS 12.250 modify the term "public corporation": "other" and "therein." Based on the express words of the statute, we conclude that the exemption described in ORS 12.250 applies to corporations in addition to—or other than—the state and counties that are formed for the public's benefit.

The next inquiry is whether an irrigation district is formed for the public's benefit or for a public purpose. An irrigation district is a corporation formed to foster the beneficial use of water by the public. See ORS 545.249 (irrigation district's use of all water, water rights, and rights to appropriate water "declared to be a public use more necessary and more beneficial than any other use"). In Twohy Bros. Co. v. Ochoco Irr. Dist. et al, 108 Or. 1, 11, 216 P. 189 (1923), this court held that an irrigation district is a municipal corporation, because "its property [is] public property and its officers [are] public officers, elected by the legal voters of the irrigation district * * *. Such a district `is created for a public purpose * * *.'" From the foregoing, we conclude that an irrigation district formed under ORS chapter 545 is a public corporation within the meaning of ORS 12.250.

We answer Certified Question No. 1 "YES."

CERTIFIED QUESTION NO. 2:

"Does [ORS] 12.250's exemption to applicable limitations apply to [ORS] 30.905(1), a statute of ultimate repose outside of [ORS] chapter 12?"

The second certified question subsumes two issues. The first is whether the exemption in ORS 12.250 is restricted to limitations prescribed in ORS chapter 12, or whether the exemption applies outside ORS chapter 12 as well. The second issue is whether the exemption applies to ORS 30.905(1), which is a statute of ultimate repose outside ORS chapter 12.

Shasta argues that the exemption from applicable statutes of limitations applies outside ORS chapter 12, because ORS 12.250 contains a policy reflected in the Latin maxim, "nullum tempus occurrit regi," which means that "[t]ime does not run against the [sovereign]." Black's Law Dictionary at 1068. Amoco responds that resolution of the issues is a matter of statutory construction. We agree. Consequently, we turn again to the template for statutory construction, looking first to the text and context of the statute. PGE, 317 Or. at 610,859 P.2d 1143.

ORS 12.250, quoted above, consists of a single sentence. The exemption contained in that statute unambiguously refers to "the limitations...