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

Background

In 2010 Jill and Travis B. inquired of DHHS social worker Jodene Gall whether prospective adoptee K.D.M. had any sexual-abuse history; Gall replied "no."
Gall had accessed case materials and intake reports indicating allegations of sexual abuse and sexually acting-out behavior, but the parents were not told those details; K.D.M. was placed in their home.
About five months after placement K.D.M. sexually assaulted the parents’ child; the parents sued the State and DHHS for negligence (failure to warn/disclose and negligent supervision).
The State pleaded the misrepresentation/deceit exception to the State Tort Claims Act (§ 81-8,219(4)) as an affirmative defense and claimed sovereign immunity applied.
The district court (bench trial) found Gall knowingly misrepresented/withheld K.D.M.’s sexual history, concluded the gravamen of the parents’ claims was misrepresentation, and dismissed the complaint under the intentional-torts exception.
On appeal the Nebraska Supreme Court affirmed, holding the misrepresentation exception bars these claims (including nonpecuniary/physical-injury claims) and disapproving Fuhrman to the extent it suggested a mere nondisclosure without inference of intent falls outside the exception.

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 decided immunity in plaintiffs' favor	Denial was interlocutory and did not decide immunity	Denial of summary judgment is interlocutory; law-of-the-case inapplicable
Sufficiency of State's pleading of misrepresentation affirmative defense	Answer did not properly plead intent-based defense	Answer and pretrial order gave fair notice of misrepresentation defense	Pleading and pretrial order gave fair notice; defense properly raised
Whether misrepresentation/deceit exception to waiver of sovereign immunity bars claims grounded in nondisclosure that caused physical injury	Misrepresentation tort requires pecuniary/commercial loss; exception shouldn't bar personal-injury claims	Exception covers misrepresentations (negligent or intentional) that are the gravamen of the claim, even where injury is physical	Exception applies to negligent or intentional misrepresentation causing physical harm; parents' claims arise from misrepresentation and are barred
Whether negligent-supervision claim survives despite exception because it alleges an operational duty	Supervision claim alleges independent operational duty and negligent training/supervision	Negligent-supervision claim is inextricably linked to misrepresentation and thus arises out of an excepted intentional tort	Negligent-supervision claim barred because it arises out of misrepresentation/deceit

Key Cases Cited

United States v. Neustadt, 366 U.S. 696 (1941) (FTCA misrepresentation exception covers negligent and intentional misrepresentation; essence is communication of misinformation)
Block v. Neal, 460 U.S. 289 (1983) (misrepresentation exception applies when claim is based on the communication of misinformation)
United States v. Shearer, 473 U.S. 52 (1985) (Congress intended the FTCA’s intentional-torts exception to exclude government financial responsibility for assaults and batteries)
Stonacek v. City of Lincoln, 279 Neb. 869 (2010) (failure to communicate critical information is a misrepresentation-based claim and falls within torts-exception to waiver)
Fuhrman v. State, 265 Neb. 176 (2003) (disapproved in part; previously treated a complete failure to convey information without an inference of deliberate concealment as outside misrepresentation exception)
Johnson v. State, 270 Neb. 316 (2005) (claims that ‘‘sound in negligence’’ but stem from an intentional tort are barred by the intentional-torts exception)
Lamb v. Fraternal Order of Police Lodge No. 36, 293 Neb. 138 (2016) (statutory waivers of sovereign immunity are construed strictly in favor of the State)