NATIONAL DISTRIBUTING COMPANY INC. et al. v. DEPARTMENT OF TRANSPORTATION., 248 Ga. 451, 283 S.E.2.d 470 (1981)
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Certiorari to the Court of Appeals of Georgia -- 157 Ga. App. 789., Judgment affirmed. All the Justices concur, except Hill, P. J., Clarke and Smith, JJ., who dissent.
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Certiorari to the Court of Appeals of Georgia -- 157 Ga. App. 789., Judgment affirmed. All the Justices concur, except Hill, P. J., Clarke and Smith, JJ., who dissent.
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Arthur K. Bolton, Attorney General, Roland F. Matson, Michael E. Hobbs, Assistant Attorneys General, for appellee.Charles H. Ivy, amicus curiae.George B. Haley, Kevin B. Buice, for appellants.
We granted certiorari to consider whether the Department of Transportation of the State of Georgia (DOT) is subject to suit for damages for breach of contract. The Court of Appeals held, as did the trial court, that the doctrine of sovereign immunity is a complete defense to such a suit. National Distributing Co. v. Department of Transportation,
DOT entered into a written agreement in 1978 with National Distributing Company, Inc. (National) and others. The writing was denominated a "soil easement." The purpose was to provide material for a construction project of DOT. A certain amount of material was to be removed from the site by DOT and a stated price per cubic yard paid to National. Furthermore, DOT was to grade, slope and revegitate the site. DOT was also required to furnish a topographic map at the completion of the work. Rights under this agreement were assigned by DOT to a private corporation which was engaged in the project. The corporation elected not to use material from the site which was a choice it was entitled to make under the assignment. The material was not removed from the site nor was any of the other site work done. The topographic map was not furnished. National then filed its complaint seeking damages from DOT for breach of the agreement. The trial court granted summary judgment in favor of DOT on its motion setting forth, among others, the ground of sovereign immunity. The Court of Appeals affirmed on the basis of sovereign immunity.
It is the contention of National that, while the doctrine of sovereign immunity generally applies to suits against DOT, there has been a waiver of the doctrine which affects the action in this case. National points to Georgia Laws 1973, pp. 947, 983 as constituting the waiver. In particular, that portion of the Act codified as Code Ann. 95A-304 is noted:
"Suits by or against the department
(a) Suits and settlement of claims
The department shall have the authority to bring suits, and it may be sued in such actions as are permitted by law. . . . (Emphasis supplied.)
(b) Venue and service of process
All suits brought ex contractu by or against the department shall be brought in a county where any part of the work is to be or has been performed. . . ."
Clearly, the statute purports to allow suits against the department. However, the language of the statute does not tell us whether all suits are permitted, or if not, what type suits are permitted. We are told only that the DOT may be sued in "such actions as are permitted by law." Assuming, as the parties have, that sovereign immunity generally applies to suits against DOT, we must resolve two preliminary questions in order to answer the certiorari question. (1) May sovereign immunity be waived by legislative enactment? (2) If sovereign immunity may be waived by legislative enactment, are suits for damages for breach of contract included within the language used by the legislature in Code Ann. 95A-304 so as to create a waiver?
We deal with the first question. We have recognized that the doctrine of sovereign immunity came to us in Georgia through the common law of England. Crowder v. Dept. of State Parks,
National argues that State Hwy. Dept. v. W. L. Cobb &c. Co., supra, found an express waiver and did not turn on the implied theory of Blanton. It is true that the Code of 1933 provided in Section 95-1505 that the "highway department may sue and be sued. . ." . It is true that Cobb &c. Co. in 1965 cited this provision. (And we note that in Busbee v. University Professors, supra, we held that other language which we equated to "sue and be sued" constituted express statutory authority for suits against the Board of Regents.) But, even if it can be said that Cobb &c. Co. relied on Code Ann. 95-1505 as an express waiver, this code section was repealed by the 1973 act which gave us the new language, "may be sued in such actions as are permitted by law." The old code section cannot be relied upon by these parties who contracted in 1978, long after its repeal. Neither can it be said that the new code section adopted the old through the device of incorporating Cobb &c. Co. which in turn relied in part on the old code section. This flies in the face of the specific repeal of the old section.
We hold that the Department of Transportation of the State of Georgia may rely on the defense of sovereign immunity in suits seeking to recover damages for breach of contract.
WELTNER, Justice, concurring.
I cannot dispute the proposition that the doctrine of sovereign immunity is outmoded and imperfect. Nor can I quarrel with Justice Clarke's logic in his observation that its application to this case must of necessity vitiate for want of mutuality all contracts in which the Department of Transportation is a party. Yet, it is still the law of Georgia, 1976 Ga. Const., Art. VI, Sec. V, Par. I; Code Ann. 2-3401, and, until mitigated by the General Assembly or altered by the people, should be recognized as such.
HILL, Presiding Justice, dissenting.
As I read Justice Weltner's concurring opinion along with Justice Clarke's dissent (joined by this writer), the Department of Transportation's contracts are unenforceable for want of mutuality. Justice Smith in his dissent (joined by this writer) would find waiver of sovereign immunity as to contracts. Neither Justice Smith nor the members of the majority have expressed their views on the question of mutuality vis-a-vis sovereign immunity. Nevertheless, three members of the court have stated that the Department's contracts are unenforceable, with the other four members not expressing their views on this question.
We will have to wait until the Department of Transportation, or some other state department claiming sovereign immunity, sues on one of its "contracts" and the other party asserts that the "contract" is unenforceable for lack of mutuality. Or perhaps the question will arise when the low bidder on a state "contract" decides not to enter into the "contract" because the bidder can't enforce it. It is possible that a supplier may refuse delivery due to a price increase. The possibilities of losses to the state due to its insistence on sovereign immunity seem almost unlimited.
CLARKE, J., dissenting.
I agree that the doctrine of sovereign immunity is alive and well in Georgia; however, it is my opinion that in this instance immunity has been waived. The Department of Transportation is authorized to enter into contracts. Code Ann. 95A-302 (e), 95A-801, et seq. An agreement enforceable as to one party and unenforceable as to the other party lacks mutuality and is no contract at all. Therefore, I believe the legislative authority to contract amounts to an express waiver of governmental immunity when the contract is entered into in accordance with the terms of the legislative act.
For these reasons, I must dissent. I am authorized to state that Presiding Justice Hill joins in this dissent.
SMITH, Justice, dissenting.
In some of our prior cases, particularly older ones, there is language to the effect that "a sovereign State is not liable to suit at the instance of a citizen, unless permission to sue has been expressly granted." (Emphasis supplied.) Peeples v. Byrd,
In PMS Const. Co. v. DeKalb County,
Code Ann. 95A-304 (a) clearly places limits on the doctrine of sovereign immunity with regard to suits against the Department of Transportation. It provides that "[t]he department shall have the authority to bring suits, and it may be sued in such actions as are permitted by law." I can perceive no meaningful distinction between Code Ann. 95A-304 (a) and Code Ann. 23-1501, 1502 insofar as the waiver of sovereign immunity is concerned. By statute, as well as by the dictate of common sense, the Department of Transportation stands in the same shoes as a county. Thus, if the department "is authorized by statute to contract, and in pursuance of such power does contract, then an action will lie against it to enforce such liability, . . . although there is no statute expressly authorizing the bringing of an action for such purpose." Decatur County v. Praytor, Howton &c. Co., supra at 934. I recognize that this conclusion acknowledges the possibility of an "implied waiver" of sovereign immunity and is therefore contrary to cases exemplified by Peeples v. Byrd, supra. See Justice Hill's special concurrence in PMS Const. Co. v. DeKalb County, supra at 873. However, I find modification of such cases preferable to the pointless inconsistency fostered by the majority opinion.
Code Ann. 95A-302 (e) provides: "The department shall have the authority to negotiate, let, and enter into contracts with any person, State agency, or county or municipality of the State for the construction or maintenance of any public road or any other mode of transportation or for the benefit of or pertaining to the department or its employees in such manner and subject to such express limitations as may be provided by law." There is no doubt that the contract at issue in this case was entered into pursuant to legislative authorization. I therefore would hold that the department has waived the defense of sovereign immunity.
In reaching its decision, the majority appears to have overlooked Code Ann. 95A-303, which provides: "In addition to the powers specifically delegated to it in this Title, the department shall have the authority to perform all acts which are necessary, proper, or incidental to the efficient operation and development of the department and of the State Highway System and of other modes and systems of transportation, and the provisions of this Title shall be liberally construed to that [e]nd." (Emphasis supplied.) Under the doctrine of sovereign immunity, "whoever contracts with the State trusts to the good faith of the State [to live up to its word] . . ." Ga. Military Institute v. Simpson,
I respectfully dissent.
I am authorized to state that Presiding Justice Hill joins in this dissent.
1981
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This document cites
- Supreme Court of Georgia - PMS CONSTRUCTION COMPANY, INC. et al. v. DEKALB COUNTY et al.; and vice versa., 243 Ga. 870, 257 S.E.2.d 285
- Supreme Court of Georgia - AZIZI v. BOARD OF REGENTS OF THE UNIVERSITY SYSTEM OF GEORGIA et al., 233 Ga. 487, 212 S.E.2.d 627 (1974)
- Supreme Court of Georgia - HANCOCK COUNTY v. WILLIAMS et al., 230 Ga. 723, 198 S.E.2.d 659 (1973)
- Supreme Court of Georgia - CROWDER v. DEPARTMENT OF STATE PARKS et al., 228 Ga. 436, 185 S.E.2.d 908 (1971)
- Supreme Court of Georgia - JAMES v. THE STATE., 225 Ga. 809, 171 S.E.2.d 533 (1969)
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