Vlotho v. Hardin County

• Decision Date: 24 November 1993
• Docket Number: No. 92-1183,92-1183
• Citation: 509 N.W.2d 350
• Parties: Rodney VLOTHO, Appellant, v. HARDIN COUNTY, Hardin County Board of Supervisors, Donald Balvanz and Linn Adams, Appellees.
• Court: Iowa Supreme Court

Page 350

509 N.W.2d 350

31 A.L.R.5th 812

Rodney VLOTHO, Appellant, v. HARDIN COUNTY, Hardin County Board of Supervisors, Donald Balvanz and Linn Adams, Appellees.

No. 92-1183.

Supreme Court of Iowa.

Nov. 24, 1993.

As Amended on Denial of Rehearing Dec. 21, 1993.

Rand S. Wonio of Lane and Waterman, Davenport, for appellant.

Carlton G. Salmons of Austin, Gaudineer, Austin, Salmons & Swanson, Des Moines, for all appellees; John P. Whitesell of Whitesell Law Office, Iowa Falls, for appellee Hardin County (cross-appeal).

Considered by HARRIS, P.J., and CARTER, LAVORATO, SNELL, and TERNUS, JJ.

LAVORATO, Justice.

This case is about a bridge with historical significance that a county engineer tore down, allegedly without authority from the county board of supervisors. The board fired the engineer because of his actions. He, in turn, sued the county and two members of the board of supervisors for wrongful termination and defamation. The county responded with a counterclaim for damages it allegedly sustained when the bridge was torn down. Following a bench trial, the district court found against the engineer on his claims and found for the county on its claim.

The engineer appealed, contending that the district court erred in (1) refusing to set aside a default for his failure to timely reply to the county's counterclaim, (2) finding he was not entitled to indemnification, and (3) awarding damages to the county based on replacement costs. The county cross-appealed, contending that the court erred in not awarding (1) punitive damages, and (2) damages based on the bridge's aesthetic and historical significance value.

We reverse on the indemnification issue and remand to allow the district court to determine whether the engineer is entitled to indemnification on the basis that his actions in tearing down the bridge were within the scope of his employment. We affirm on the other issues raised in the appeal. We affirm on the cross-appeal.

I. Background Facts and Proceedings.

Rodney Vlotho was the Hardin County engineer from 1977 until the county terminated his employment in February 1990. His duties included overseeing construction and maintenance of the roads and bridges in the county. Over a twelve year period, Vlotho's department had replaced approximately eight to nine bridges per year.

In November 1989 county personnel, acting pursuant to a directive from Vlotho, tore down the Eagle City Bridge. This bowstring bridge was built in the 1870s. It was made of wrought and cast iron. Few remain in existence in Iowa.

Since 1983 the bridge had been open only to pedestrian traffic. That year a new bridge was built to replace it. The county obtained state and federal funding to build the new bridge. The county obtained these funds on the written condition that the county would preserve and maintain the Eagle City Bridge as a foot bridge. Vlotho signed written correspondence to that effect on behalf of the county.

When Vlotho gave the demolition crew their instructions to tear down the old bridge, he told them to keep the bridge's destruction quiet. Once the public learned about the bridge's fate, there was a fire storm of controversy. A number of citizens appeared at board meetings to express their displeasure. It was at one of these meetings the two Hardin County supervisors allegedly made statements that formed the basis of Vlotho's defamation claim.

The board terminated Vlotho's employment on February 1, 1990. The board notified Vlotho of the termination by letter in which it gave three reasons for its action: (1) his failure to follow past practices and procedures in demolishing the Eagle City Bridge, (2) his order to demolish the bridge without prior authorization from the board, and (3) his violation of the agreement with state and federal authorities to preserve and maintain the bridge as a walking bridge for the public.

The termination prompted Vlotho to sue the county, its board of supervisors, and the two board members. In the suit Vlotho alleged his discharge was wrongful and his character was defamed.

The county counterclaimed, seeking damages from Vlotho for the old bridge's destruction. The county alleged that Vlotho had acted outside his authority when he ordered the bridge demolished.

Vlotho did not reply to the counterclaim within the time allowed. That prompted the county to secure a default from the clerk of district court. The district court denied Vlotho's motion to set aside the default, and this court denied Vlotho's application for interlocutory appeal from that ruling.

The bench trial, posttrial motions and rulings on them, this appeal, and cross-appeal followed.

As we discuss the issues raised, we recite additional facts relevant to those issues.

II. The Default Issue.

On December 7, 1990, the county filed its answer and counterclaim. Vlotho's reply to the counterclaim was due by December 27. Vlotho's attorney did not file this reply until January 4, 1991, about a week late. In the meantime, the county had the clerk enter a default on the counterclaim on December 31, four days after the reply was due. The district court refused to set aside the default. For reasons that follow we hold that the clerk had no jurisdiction to enter the default. The default was therefore void and without effect.

Iowa Rule of Civil Procedure 85 governs time to move or plead. Rule 85(b) requires a plaintiff to "serve a reply to a counterclaim in the answer within twenty days after service of the answer."

Iowa Rule of Civil Procedure 230 defines defaults, and Iowa Rule of Civil Procedure 231 governs how defaults are entered. They pertinently provide:

Rule 230. Default Defined

A party shall be in default whenever that party: (a) fails to serve, and within a reasonable time thereafter file, a motion or answer as required in R.C.P. 53 or 54, or, has appeared, without thereafter serving any motion or pleading as stated in R.C.P. 87....

Rule 231. How Entered

If a party not under legal disability or not a prisoner in a reformatory or penitentiary is in default under R.C.P. 230(a), the clerk, on demand of the adverse party, must forthwith enter such default of record without any order of court. All other defaults shall be entered by the court.

Plainly, according to Rule 231, the only defaults the clerk has authority to enter are those listed in Rule 230(a). Rule 85(b), which governs the time limit for replies to counterclaims, is not mentioned in Rule 230(a). Consequently, the clerk has no jurisdiction to enter defaults on counterclaims. Counterclaim defaults are covered by the catch-all language at the end of Rule 231: "All other defaults shall be entered by the court." Here only the district court could have entered the default. Our court of appeals, using similar reasoning, reached the same conclusion in Croell Redi Mix, Inc. v. Schwickerath, 423 N.W.2d 898, 900 (Iowa App.1988).

At trial the district court allowed Vlotho to contest the allegations of the counterclaim despite the default. The trial judge wisely recognized in his findings that the "default may be void or voidable because it was entered by the clerk." The default therefore had no effect on the outcome of the suit. However, we feel compelled to address the issue because even at this late date the county is still insisting that the default was good. If the county were right, that would mean--as the county argues--that all of the allegations of the counterclaim would be deemed admitted.

In this connection we need to mention that attorney John P. Whitesell, one of the attorneys for the county, came into the case after the default had been entered and after the district court had refused to set it aside. Whitesell disavows any participation in securing the default and any participation in that part of the county's brief urging this court to uphold the default. Whitesell's representation of the county here was limited to the cross-appeal which dealt with damages only.

We would be remiss in our duty to the public, bench, and bar if we were to ignore the manner in which this default was taken. Standards of civility exist in the practice, not as a matter of convenience to the profession, but as a matter of fairness and simple justice. These standards condemn unfair tactics, such as "blind siding" counsel of record with an ex parte application for default. Departure from the standards of civility are obvious examples of ineffective and counterproductive advocacy. Such departures are condemned because they severely distract from the quality of justice Iowa citizens have a right to expect when they come to court.

Interestingly, the Committee on Civility of the Seventh Federal Judicial Circuit has addressed this problem in its "Proposed Standards For Professional Conduct Within the Seventh Judicial Circuit." One of its proposed standards addressing conduct among lawyers provides:

We will not cause any default or dismissal to be entered without first notifying opposing counsel, when we know his or her identity.

Marvin E. Aspen, The Judiciary--New Issues and New Visions, 40 Fed.B.News & J. 496, 499 (1993).

III. The Indemnification Issue.

As the district court concluded, the indemnification issue arises out of the county's counterclaim. In essence, by its counterclaim, the county seeks damages from Vlotho for his alleged unauthorized removal of the bridge. Iowa Code section 613A.8 requires the county to defend, save harmless, and indemnify its employees against any tort claim "arising out of an alleged act or omission occurring within the scope of their employment or duties." The district court found that in removing the bridge "Vlotho was acting outside the performance of official duties." For this reason, the court denied Vlotho's claim for indemnification.

Unless otherwise provided by statute, an employee is liable in damages to the employer for the employee's negligence or wrongful act resulting in loss to the employer. 30 C.J.S. Employ...