Jill B. & Travis B. v. State, 297 Neb. 57

Background

In 2010 Jill and Travis B. inquired of DHHS caseworker Jodene Gall whether prospective adoptee K.D.M. had any sexual-abuse history; Gall answered “no” though records and a master file contained allegations and forensic interview results indicating sexual abuse and sexualized acting out. K.D.M. was placed in the B family’s home and about 5 months later sexually assaulted the B’s child.
The Bs sued the State of Nebraska and the Nebraska Department of Health and Human Services under the State Tort Claims Act for negligence — failure to warn/disclose and negligent supervision.
The State pleaded the misrepresentation/deceit exception in Neb. Rev. Stat. § 81-8,219(4) as an affirmative defense, arguing Gall’s withholding/false statements fit that exception so sovereign immunity barred recovery.
The district court denied the State’s summary-judgment motion, tried the case without a jury, found Gall knowingly misrepresented/withheld K.D.M.’s sexual history, held the gravamen of the claim was misrepresentation, and dismissed under the misrepresentation/deceit exception.
On appeal the Nebraska Supreme Court affirmed: it held the misrepresentation exception applies to claims involving physical injury (not limited to pecuniary/commercial loss), construed waivers of sovereign immunity strictly in favor of the State, rejected the plaintiffs’ law-of-the-case and pleading challenges, and affirmed dismissal of negligent-supervision claims as arising from the same misrepresentation.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether law-of-the-case barred relitigation of immunity after denial of summary judgment	Denial of summary judgment resolved immunity against State	Denial was interlocutory; genuine fact issues remained for trial	Denial was interlocutory; law-of-the-case inapplicable
Whether State sufficiently pleaded misrepresentation affirmative defense	Answer referenced negligence; plaintiffs argued no fair notice of intentional misrepresentation defense	State cited §81-8,219(4) and pretrial issues; plaintiffs were put on fair notice	Pleading and pretrial order gave fair notice; defense properly raised
Whether misrepresentation/deceit exception bars claims based on Gall’s false assurances (including claims for physical injury)	Misrepresentation tort applies only to pecuniary/commercial losses; physical-injury claims not barred	Misrepresentation exception covers negligent or intentional misrepresentation that is the gravamen of the claim; strict construction favors immunity	Misrepresentation exception can apply to noncommercial and physical-injury claims; plaintiffs’ claims arise from misrepresentation and are barred
Whether negligent supervision claim survives despite misrepresentation exception	Supervision is an operational duty separate from misrepresentation	Supervision claims arising from intentional torts are barred if they stem from the intentional tort	Court held negligent-supervision claim barred because it arose out of the misrepresentation/deceit

Key Cases Cited

United States v. Neustadt, 366 U.S. 696 (U.S. 1961) (FTCA misrepresentation exception covers negligent as well as intentional misrepresentation)
Block v. Neal, 460 U.S. 289 (U.S. 1983) (essence of misrepresentation claim is communication of misinformation on which recipient relies)
Stonacek v. City of Lincoln, 279 Neb. 869 (Neb. 2010) (failure to communicate relevant information is a misrepresentation-based claim barred by exception)
Johnson v. State, 270 Neb. 316 (Neb. 2005) (claims framed as negligence that stem from intentional torts are barred by intentional-torts exception)
Fuhrman v. State, 265 Neb. 176 (Neb. 2003) (disapproved insofar as it held complete failure to convey critical information absent inference of deliberate withholding falls outside misrepresentation exception)
United States v. Shearer, 473 U.S. 52 (U.S. 1985) (discussion of Congress’ intent that government not be financially responsible for assaults/batteries of its employees)