Iowa Open Meetings Law Does Not Apply to Negotiating Committees of Public Bodies

Mason v. Vision Iowa Board of the State of Iowa, _____ N.W.2d _____ (Iowa 2005)(No. 69/04-0491)
Opponents of the Marquette-McGregor Legacy Project argued that a negotiating committee appointed by the Vision Iowa Board in connection with a $5 million grant should have been open to members of the public and subject to the Iowa Open Meetings Law. Chapter 21, Iowa Code. The Iowa District Court for Polk County granted summary judgment for the defendants, finding that the negotiating committee was not a governmental body, and even if it was, the negotiating committee did not hold a meeting within the meaning of Chapter 21. The opponents appealed the district court decision.

The Supreme Court, Ternus, J., concludes that meetings of the negotiating committee are not within the prohibitions of the Iowa open meetings law. The district court decision is affirmed. The opinion observes that Chapter 21 of the Iowa Code favors openness in Iowa government, but it also notes that not all gatherings are considered meetings under the statute. For a gathering to be a meeting, there must be deliberation or action upon any matter “within the scope of the governmental body’s policy-making duties.” The Court states, “‘policy making’ is deciding with authority a course of action.” In this case, the negotiating committee’s duties were advisory only. The Vision Iowa Board made ultimate decisions about the project. The Court rejects a contention that the negotiating committee was a de facto “policy making duty” because government boards, such as the Vision Iowa Board, routinely accept recommendations made by such groups. The Court writes, “Chapter 21 clearly reaches only those meetings at which the governmental body deliberates or acts in a ‘policy-making’ role. Because there are no facts in the record to support a finding that the negotiating committee had anything more than an advisory function, its March 2003 meeting was not required to be open to the public.”

Multi-Million Dollar Award in Natural Gas Explosion Upheld; Utility Had Common Law Duty to Warn

Estate of Pearson v. Interstate Power and Light Co., _____ N.W.2d _____ (Iowa 2005)(No. 57/03-1668)
A natural gas explosion occurred on October 29, 1998, at the home of Mary and Robert Pearson in Lone Tree, Iowa. Mrs. Pearson died at the scene from the injuries that she suffered. Robert Pearson had burns over more than 80% of his body. He died at a hospital about 17 hours after the incident.

A stove in the Pearsons’ home was connected to the natural gas system with a device known as a cobra connector. Sulfur compounds in the natural gas supplied by Interstate Power caused corrosion and failure of the cobra connector, resulting in the fatal explosion. The Pearsons’ Estates filed a wrongful death lawsuit against Interstate Power in Johnson County. The power company argued it had no duty to warn Mr. and Mrs. Pearson about problems with the cobra connector, and that tariffs filed under the Iowa Code immunized it from liability. The district court denied Interstate’s contentions. A jury returned multi-million dollar verdicts against Interstate Power in favor of each estate. The jury found Interstate Power 70% at fault. Each estate was assessed 15% fault. Interstate Power appealed, arguing it had no duty to warn, that it was immunized by the tariff doctrine, that the damages awarded were excessive, and that the district court improperly applied the joint and several doctrine.

The Supreme Court decision is written by Wiggins, J. Interstate’s arguments about its duty to warn are rejected. The Court notes that Iowa follows Restatement (Second) of Torts §388 (1965), and Interstate had a duty to exercise reasonable care to inform the Pearsons of dangers associated with the natural gas it supplied when it came into contact with a cobra connector. Evidence at trial showed that Interstate was aware of prior failures with cobra connectors and that it had received notices from the American Gas Association and Consumer Product Safety Commission as early as 1979. In the 1980s Interstate employees were instructed to inspect customers’ homes and to tell customers to have cobra connectors replaced. There was no evidence presented that the Pearsons were aware of the dangers associated with natural gas and the cobra connector. The Court concludes, “This evidence supports a conclusion that IES had a duty to exercise reasonable care to inform its customers, including the Pearsons, of the dangers inherent in using its gas with a cobra connector, and IES failed to exercise reasonable care to provide the Pearsons with an adequate warning of the dangers.

The Court rejects Interstate’s argument that the tariff doctrine applies. “A tariff can only limit the liability of a utility if the limitation is with the tariff’s ambit.” The Court finds that the tariff requires the utility to exercise reasonable care to minimize any hazard inherent in the natural gas it provides customers. The tariff incorporates the common law duty to warn.

Interstate challenged the jury awards for loss of parental consortium and predeath physical and mental pain and suffering. The Court observes that Mr. and Mrs. Pearson had close relationships with each of their adult children, and it details the nature of the relationships. “Although the wards for loss of parental consortium are sizeable, the awards are neither lacking in evidentiary support nor flagrantly excessive.” Similarly, the Court observes that following the explosion, Mary was found on the first floor of her home by the garage door. This indicates that she lived for a period of time following the explosion. Robert apparently got out of the house and went to the home of a neighbor for help. Medical records indicate that Robert was conscious and aware of his situation. At one point Robert stated to a health care provider, “Oh, damn, I’m still here.” Again, the Court writes, “The awards for physical and mental pain and suffering are neither lacking evidentiary support nor excessively flagrant.”

The Court does conclude that the district court failed to apply the proper percentage of fault to noneconomic damages. Under section 668.4, Iowa Code, since Interstate was more than fifty per cent at fault, it is jointly and severally responsible for 85% of economic damages included by each of the estates, but it is only liable for 70% of the noneconomic damages, including the children’s’ loss of consortium claims.

The Court returns the case to district court for entry of judgment consistent with its decision.

Truck Driver Is an Independent Contractor and Not Entitled to Workers’ Compensation Benefits

Finch v. Schneider Specialized Carriers, Inc., _____ N.W.2d _____ (Iowa 2005)(No. 45/03-1012)
Gary Finch argued he was an employee of Schneider Specialized Carriers for purposes of workers’ compensation benefits. The industrial commission denied benefits, holding that Finch was an independent contractor. The Iowa District Court for Polk County reversed, holding Finch was not an independent contractor under section 85.61(13(c). The court of appeals reversed. The Supreme Court granted further review.

The Court’s per curiam opinion holds that at that the time of his injury Finch was an independent contractor. The Court points to an “Independence Contractor Operating Agreement” between Finch and Schneider. The opinion notes, “Because the commissioner is charged with weighing the evidence, we liberally and broadly construe the findings to uphold his decision. The court of appeals followed this rule and affirmed the commissioner’s ruling. We agree with the court of appeals’ resolution on this issue.”

The Court rejects the court of appeals’ order remanding the case under section 17A.19(10(h), Iowa Code, and directing the commissioner to explain possible inconsistencies between prior rulings and the agency decision in this case. The Court notes the commissioner was required to base his determination of whether Finch was an employee or independent contractor on substantial evidence and proper application of pertinent legal principles. The Court states, “We do not believe that Iowa Code section 17A.19(10)(h) establishes an independent requirement that the commissioner identify other agency rulings and explain possible inconsistencies between those rulings and the agency’s decision in a case not reviewable under an abuse-of-discretion standard. Therefore, it is not necessary or appropriate to remand this case to the commissioner for an explanation of a possible inconsistency between the commissioner’s ruling in this case and prior cases decided by the commissioner.”