Vol. 71, No. 3, March
1998
Government Immunity
for Professional Independent Contractors
Three-part test
The Wisconsin Court of Appeals affirmed the trial court. In doing so,
it adopted for Wisconsin a three-part test similar to that annunciated by
the U.S. Supreme Court in Boyle
v. United Technologies Corp., 9 under
federal tort statutes. Strand had cited to Boyle as persuasive authority
in both the trial court and court of appeals.
In Boyle plaintiff attempted to sue the designer of a military
helicopter after an accident in which a helicopter crashed into water. The
occupant could not extract himself because the escape hatch opened outward
and was blocked by the water's pressure. The defendant designer argued that
it should be entitled to immunity for the design decision because the military
dictated the specifications of the escape hatch. Instead of announcing a
blanket rule extending immunity to all aspects of work performed by government
contractors, the court set forth a three-part test that contractors must
meet to be conferred with governmental immunity under federal tort statutes:
1) the U.S. approved reasonably precise specifications; 2) the equipment
conformed to those specifications; and 3) the supplier warned the U.S. about
dangers in the use of the equipment that were known to the supplier but
not to the United States. 10
Following the rationale of Boyle, the District II Wisconsin Court
of Appeals, in an opinion written by Judge Richard Brown, "adopt[ed]
a form of governmental contractor immunity applicable to parties who contract
with municipal or state authorities and are directed to perform certain
tasks under that contract." 11 The court
held that "an independent professional contractor who follows official
directives is an 'agent' for the purposes of § 893.80(4),
Stats., or is entitled to common law immunity" 12
provided the professional contractor can meet a three-part test similar
to that used for claims against federal contractors. To avail themselves
of the defense, contractors must show that: 1) the governmental authority
approved reasonably precise specifications; 2) the contractor's actions
conformed to those specifications; and 3) the contractor warned the supervising
governmental authority about the possible dangers associated with those
specifications that were known to the contractor but not to the government
officials. 13 The court affirmed the summary
judgment granted to Strand.
Cause and effect
During the various arguments in Estate of Lyons, the parties,
including the DOT as amicus curiae, discussed the effect of granting the
design firm immunity rather than having it answer in court for the decision
to reduce the length of the vertical curve for the bridge design.
The DOT objected to a blanket holding that contractors performing work
for governmental entities are always "agents" as that term is
used in the governmental immunity statute. The DOT expressed concerns that
a broad ruling that contractors are agents would implicate the government
and taxpayers with duties to both represent and indemnify independent contractors
in civil suits. Having hired an independent firm to exercise and implement
these governmental decisions, the government would, in a sense, be insuring
the contractor's work. This was a duty the taxpayers did not want to assume.
However, the DOT supported Strand on its argument that immunity should
apply in this case. To hold Strand liable for merely facilitating a governmental
directive for which the directing state officer was immune could effectively
remove the benefits of governmental immunity granted to the governmental
officers making a discretionary decision. State and local governments make
widespread use of independent contractors to execute certain governmental
functions. The immunity for government officers making discretionary decisions
could effectively be removed if independent contractors facilitating such
decisions can be held liable in tort. As the appeals court noted, if the
contractors facilitating a governmental directive can be held liable for
a discretionary governmental act, the contractors would be subjected to
increased risks and associated costs, and ultimately would pass those costs
on to the contracting government, effectively eliminating the taxpayer benefits
secured by the immunity statutes. 14 The court
also cited the fact that it would be "fundamentally unfair" to
hold a contractor liable for injuries caused by a defective design when
the governmental authority was responsible for its development. 15
In practice
Attorneys should advise clients doing work as government contractors
to document well any deviation from existing standards or practices. This
would include identifying the existing standard or practice, identifying
the specific deviation from the standard or practice requested by the government
principal, outlining potential costs and risks associated with such deviation,
and obtaining a written directive from the government principal for the
deviation.
![](/SiteCollectionImages/WisconsinLawyer/1998/03/pair2.jpg)
Jeffrey L. Janik (left), U.W. 1994, is an associate at
Godfrey, Braun & Frazier, Milwaukee. W. Wayne Siesennop (right), Marquette
1978, is a partner in the law firm of Hannan, Siesennop & Sullivan,
Milwaukee, and is a registered professional engineer in Wisconsin. They
were attorneys of record for both the professional design firm and its insurer
in Estate of Lyons v. CNA Ins. Cos. |
In Lyons the claim involved problems with the vertical curve standards
and lines-of-sight. There, the cost issue concerned additional fill and
work on the adjoining roadways. In other instances the need to condemn additional
real estate may be required to design a roadway for the "proper"
travel speed, or, with respect to jails, the "best" prison locks/doors
may be prohibitively expensive. These may be costs government representatives
do not wish the public to incur. A designer in that situation should work
closely with the government and carefully document its files to show consideration
of alternatives. If the government chooses a less expensive alternative
in writing, the designer will have a well-documented file to show that different
alternatives were explored, and government officials entrusted with the
power to make decisions in their quasi-legislative capacity made the discretionary
(and immune) decision to deviate from the standard or state-of-the-art.
This documentation also will alert the government principal to take safety
precautions, such as a sign warning drivers that an upcoming curve must
be negotiated at a slower than normal travel speed for that roadway.
Most design decisions involve costs and benefits. To implement the "safest"
design may be cost-prohibitive. This is especially true for public improvements.
Certainly, topography and land ownership constrain the government's ability
to have the "safest" possible road, with no hills or curves. Thus,
safety benefits must necessarily be traded for making the project cost-feasible.
A contractor involved with such a project should thoroughly document the
standards, alternatives, and safety concerns at the time of the project
to avail itself of this extension of immunity.
Conclusion
For the first time under Wisconsin law, governmental immunities were
extended to shield a professional independent contractor from liability
for work performed on a government project. Government officers entrusted
to make cost-benefit decisions for the good of the citizens have immunity
for their official acts as a matter of law. A professional independent contractor
implementing a reasonably precise governmental directive can document its
concerns with the government principal and enjoy the same immunity given
the government officer. By merely implementing an otherwise immune governmental
decision, the contractor will not have to risk liability solely because
of its status as a private entity.
Endnotes
1 Estate
of Lyons v. CNA Ins. Cos., 207 Wis. 2d 448 (Ct. App. 1996), rev.
denied.
2Wis. Stat. §
893.80(4).
3 Wis. Stat. §
893.80(4). ("No suit may be brought against . . . [government]
officers, officials, agents or employees for acts done in the exercise of
legislative, quasi-legislative, judicial or quasi-judicial functions.")
(Emphasis and bracketed material added.)
4See Wis. Stat. §§
893.80(l) (a), 893.82(3); Smith v. Wisconsin Physician's Serv.,
152 Wis. 2d 25 (Ct. App. 1989).
5 52 Wis. 2d 479 (1974).
681 Wis. 2d 42 (1977).
7 Lister v. Bd. of Regents, 72 Wis.
2d 282, 299 (1976).
8 Slip Op. at 11, Circuit Court of Walworth
Co., Case No. 93-CV-122.
9 487
U.S. 500 (1988).
10 Id. at 512.
11 Estate of Lyons, supra note 1 at
459.
12 Id. at 459-60.
13 Id.
14 Id. at 457 (citing Vanchieri
v. New Jersey Sports and Exposition Auth., 104 N.J. 80, 514 A.2d 1323
(1986)).
15 Id.
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