Court: Court of Appeals of North Carolina; May 15, 2001; North Carolina; State Appellate Court
Guilford County appeals an order from March 29, 2000, which denied its Rule 12(b)(6) motion to dismiss the first, second, and fourth claims in Shelley Austin Wood's complaint. Wood, an employee at the Guilford County Courthouse, was assaulted in a restroom on March 31, 1998, suffering significant physical and psychological injuries. The assailant was convicted of attempted first-degree rape and assault. Wood's complaint alleges that the County and Burns International Security (which had a contract to provide security at the courthouse) failed to ensure adequate security, thus breaching their duties. The claims include: 1) Guilford County's breach of its duty to provide security; 2) Burns' breach of its duty; 3) a claim for punitive damages based on willful conduct (which was dismissed by the trial court); and 4) Wood's status as an intended third-party beneficiary of the security contract, claiming breaches by both defendants. The County's defenses include assertions of governmental immunity and the public duty doctrine, and it has denied the allegations. The trial court dismissed only the punitive damages claim against the County, allowing the remaining claims to proceed. No claims against Burns were dismissed.
The excerpt addresses four key legal issues:
1. A negligence action against a county is not considered an action against the State, meaning it does not need to be filed with the North Carolina Industrial Commission. The Tort Claims Act applies only to state departments and agencies, not to county agencies or their agents.
2. The defendant's assertion that it was exercising police powers in operating the Courthouse, thereby invoking the public duty doctrine to bar the plaintiff’s claims, is rejected. The public duty doctrine protects local governments from liability when performing general police duties, but it does not extend to actions taken as the owner and operator of a facility like the Courthouse.
3. The court finds that the defendant did not waive governmental immunity by requiring insurance from Burns, as this does not apply to the circumstances of the case.
4. The complaint adequately alleges that the contract was made for the plaintiff's direct benefit, supporting the claim against the defendant.
Overall, the trial court retains subject matter jurisdiction over the plaintiff's claims, and the public duty doctrine does not shield the defendant from liability in this context. The court did not err in declining to dismiss the claims based on these defenses.
Defendant contends that sovereign immunity justifies the dismissal of Plaintiff's claims, but the court disagrees, clarifying that while counties and their officials are generally immune from lawsuits in their official capacity, they can waive this immunity by purchasing insurance, as outlined in N.C.G.S. 153A-435(a). The court interprets "purchase" broadly, concluding that Defendant effectively waived its governmental immunity by requiring Burns to obtain a liability insurance policy naming Defendant as an additional insured, even if Defendant did not directly purchase the policy from an insurer. Therefore, the trial court did not err in denying the motion to dismiss based on governmental immunity.
However, the court agrees with Defendant regarding Plaintiff's fourth claim, which is based on the third-party beneficiary doctrine. To succeed, a plaintiff must demonstrate the existence of a valid contract intended for their direct benefit. The court finds that Plaintiff's complaint only asserts she falls within a class intended to benefit from the Contract, which is insufficient to establish direct benefit. The Contract's stated purpose is the security of the Courthouse, lacking evidence of an intention to benefit Plaintiff directly. Consequently, the complaint fails to meet the necessary elements of the third-party beneficiary doctrine and is subject to dismissal.
The trial court erred by not dismissing the fourth claim due to failure to state a claim for which relief can be granted. The court has subject matter jurisdiction over the plaintiff's claims against the defendant and correctly upheld the negligence claim against the defendant concerning the public duty doctrine and governmental immunity. However, it incorrectly permitted the claim to enforce the contract based on the third-party beneficiary doctrine. The decision is affirmed in part and reversed in part, with Judges McGEE and CAMPBELL concurring.
The plaintiff did not appeal the dismissal of the third claim. The defendant references Vaughn v. N.C. Dept. of Human Resources to argue that it is an agent of the State, thus subject to the Tort Claims Act. Vaughn established that a county agency can be considered an agent of the State but did not allow for such agencies to be sued under the Tort Claims Act. Additionally, in Cross v. Residential Support Services, it was noted that while a contract requiring a service provider to purchase insurance might indicate a waiver of immunity by the Area Authority, it does not imply that the County waives its immunity. The Cross case left unresolved whether a county requiring insurance from a service provider constitutes a waiver of the county's governmental immunity, a question now relevant to the current case.
