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Gatto v. City of Statesboro

Court of Appeals of Georgia, First Division

October 21, 2019

GATTO et al.
v.
CITY OF STATESBORO et al. ATLANTIC SPECIALTY INSURANCE COMPANY
v.
GATTO et al.

          BARNES, P. J., MERCIER and BROWN, JJ.

          BROWN, JUDGE.

         Michael and Katherine Gatto, as personal representatives of the estate of their son, Michael Joseph Gatto ("Michael"), and Michael Gatto, as administrator of the estate of his son, sued the City of Statesboro ("the City") and Sue Starling, the Clerk of the City of Statesboro, in her individual capacity (collectively "the defendants"), for their son's personal injuries and his wrongful death following an altercation with a bouncer at one of the four bars located in the University Plaza establishment in the City. The City's insurer, Atlantic Specialty Insurance Company, sought to intervene in the action. The trial court granted summary judgment to the City and Starling on grounds of proximate cause and sovereign immunity, and denied Atlantic's motion to intervene. In Case No. A19A1408, the Gattos appeal the former ruling. In Case No. A19A1409, Atlantic appeals the latter ruling. We have consolidated the appeals for review. For the reasons that follow, in Case No. A19A1408, we affirm the grant of summary judgment to the City, but reverse the grant of summary judgment to Starling; and in Case No. A19A1409, we dismiss as moot the trial court's denial of the motion to intervene as to the City, but vacate the trial court's denial of the motion to intervene as to Starling, and remand the case with direction.

         As the nonmovant on summary judgment, we construe the facts in favor of the Gattos. City of Savannah v. Herrera, 343 Ga.App. 424, 425, n.4 (808 S.E.2d 416) (2017). "However, [the Gattos] bear the burden to establish a waiver of sovereign immunity." Id. Our review is de novo. See Calloway v. City of Warner Robins, 336 Ga.App. 714 (783 S.E.2d 175) (2016). So construed, the record reflects that on the evening of August 27, 2014, and early morning hours of August 28, 2014, eighteen-year-old Michael, an incoming freshman at Georgia Southern University, was at Rude Rudy's, a bar located in University Plaza, drinking with friends.[1] In addition to Rude Rudy's, University Plaza was home to several other businesses that served alcohol, including Retrievers, Rusty's Tavern, and Rum Runners, and was within walking distance of the campus of Georgia Southern University.[2] Told by a bartender that Michael was stealing money from the tip jar, Grant James Spencer ("Spencer"), a bouncer at Rude Rudy's, went to remove Michael from the bar. Spencer struck Michael five times in the head/face, until he was limp and unconscious, and then dropped him on the floor of the bar. After Spencer heard Michael's head hit the floor of the bar, he dragged him outside and left him. Michael was discovered by emergency personnel and airlifted to a hospital in Savannah, where he died on the afternoon of August 28, 2014. Spencer pled guilty to voluntary manslaughter, and was sentenced to 20 years in prison.

         The Gattos sued the City and Starling for negligence and maintenance of a nuisance, essentially alleging that their son was beaten to death because the defendants disregarded the numerous alcohol violations and other illegal activity occurring at the University Plaza establishments, including Rude Rudy's. In their view, if the defendants had complied with and enforced the City's ordinances related to these violations, Rude Rudy's would not have held an alcohol license in August 2014, and Michael would not have been beaten. In their third amended complaint, the Gattos specifically alleged that: (1) Starling was negligent and breached her ministerial duty to set due process hearings before the Mayor of Statesboro and the City Council upon her receipt of notices of violations against the University Plaza establishments;[3] (2) the City is liable for the negligence of its employee Starling arising out of this breach; (3) the City breached a duty of ordinary care by renewing or allowing the renewal of the business and alcohol licenses of the University Plaza establishments despite its knowledge of the numerous illegal and dangerous activities occurring there; and (4) the defendants' acts and omissions over the course of several years in allowing the University Plaza establishments to remain in operation despite knowledge of the repeated criminal activity, constituted a continuing nuisance that "was injurious to the invitees to the premises, the citizens of the City . . ., and the general public." The Gattos also asserted a claim for damages pursuant to OCGA § 13-6-11. The defendants moved for summary judgment on all claims, asserting, inter alia, that the City is entitled to sovereign immunity, that Starling is entitled to qualified or official immunity, and that no act or omission of the defendants was the proximate cause of Michael's death. The trial court granted the motion on the ground that (1) intervening criminal acts - Spencer's criminal act and Michael's violation of the law (underage possession and consumption of alcohol and failure to comply with his pretrial agreement) - broke the causal chain between the defendants' breach of any duties and Michael's injuries and death, and (2) the claims against the City are barred by the doctrine of sovereign immunity. In its ruling, the trial court rejected the Gattos' argument that the defendants waived sovereign immunity by the City's purchase of an insurance policy. As to Starling, the trial court ruled that the Gattos' suit was in reality a claim against Starling in her official capacity and that she was entitled to summary judgment on the ground of sovereign immunity. The trial court denied the motion to intervene, ruling that Atlantic's interest was "adequately represented by existing parties."

         In Case No. A19A1408, the Gattos contend that the trial court erred in granting the defendants' motion for summary judgment. First, the Gattos argue that because the City purchased liability insurance covering the Gattos' claims, the General Assembly has waived the City's sovereign immunity. Second, the Gattos assert that even if the General Assembly had not waived the City's sovereign immunity, it would not apply to the Gattos' nuisance claim. Third, the Gattos contend that the public duty doctrine does not apply to their negligence claim which involves "active negligence" and does not depend on "'police protection.'" Fourth, the Gattos argue that the City's maintenance of a nuisance at Rude Rudy's and University Plaza proximately caused Michael's death. Lastly, the Gattos assert that because Starling breached her ministerial duty to schedule due process hearings, she is liable in her individual capacity. As part of this last assertion, the Gattos contend that the trial court erred in granting summary judgment to Starling on the ground of sovereign immunity because the Gattos previously dismissed their official capacity claim against her and the defendants never moved for summary judgment on the ground that sovereign immunity applied to Starling.

         In Case No. A19A1409, Atlantic contends that it moved to intervene in this lawsuit to respond to the Gattos' arguments concerning insurance coverage and judicial estoppel and to preserve its rights if the trial court denied the defendants' motion for summary judgment. A ruling by this Court affirming the grant of summary judgment would address Atlantic's concerns. Thus, Atlantic contends that the only reason to consider its appeal is if this Court reverses the order granting summary judgment.

         Case No. A19A1408

         1. We first address the Gattos' contention that sovereign immunity does not apply to their nuisance claim. "Sovereign immunity . . . raises the issue of the trial court's subject matter jurisdiction to try the case." (Citation and punctuation omitted.) City of Albany v. Stanford, 347 Ga.App. 95, 97 (1) (815 S.E.2d 322) (2018) (physical precedent only). As such, it "is a threshold issue that the trial court [is] required to address before reaching the merits of any other argument." Albertson v. City of Jesup, 312 Ga.App. 246, 248 (1) (718 S.E.2d 4) (2011). Under the Georgia Constitution, municipalities are protected by sovereign immunity unless waived by the General Assembly. Ga. Const. of 1983, Art. IX, Sec. II, Par. IX. See CSX Transp. v. City of Garden City, 277 Ga. 248, 250 (1) (588 S.E.2d 688) (2003) ("any waiver of sovereign immunity is a mere privilege, not a right, and the extension of that privilege is solely a matter of legislative grace") (citation omitted). This principle is reiterated in OCGA § 36-33-1, which pertinently provides that "it is the public policy of the State of Georgia that there is no waiver of the sovereign immunity of municipal corporations of the state and such municipal corporations shall be immune from liability for damages." OCGA § 36-33-1 (a). The statute, however, carves out two narrow exceptions as follows: subsection (a) provides that "[a] municipal corporation shall not waive its immunity by the purchase of liability insurance . . . unless the policy of insurance covers an occurrence for which the defense of sovereign immunity is available, and then only to the extent of the limits of such insurance policy." (Emphasis supplied.) OCGA § 36-33-1 (a). See also CSX Transp., 277 Ga. at 251 (2) ("the legislature has provided that municipal sovereign immunity may be waived . . . by the purchase of liability insurance"). And, subsection (b) provides that "[m]unicipal corporations shall not be liable for failure to perform or for errors in performing their legislative or judicial powers. For neglect to perform or improper or unskillful performance of their ministerial duties, they shall be liable."

         The waiver enunciated in subsection (b) has been consistently "interpreted to mean that municipal corporations are immune from liability for acts taken in performance of a governmental function but may be liable for the negligent performance of their ministerial duties." (Citations omitted.) City of Atlanta v. Mitcham, 296 Ga. 576, 577-578 (1) (769 S.E.2d 320) (2015). The difference between these two functions has been explained as follows:

Governmental functions traditionally have been defined as those of a purely public nature, intended for the benefit of the public at large, without pretense of private gain to the municipality. The exemption from liability for governmental functions is placed upon the ground that the service is performed by the corporation in obedience to an act of the legislature, is one in which the corporation has no particular interest and from which it derives no special benefit in its corporate capacity. Ministerial functions, in comparison, are recognized as those involving the exercise of some private franchise, or some franchise conferred upon the municipal corporation by law which it may exercise for the private profit or convenience of the corporation or for the convenience of its citizens alone, in which the general public has no interest.

(Citations, punctuation, and footnote omitted.) Id. at 578 (2). The Gattos contend that under common law dating back over 100 years, a municipality may be liable for damages it causes to a third party from the operation or maintenance of a nuisance, irrespective of whether it is exercising a governmental or ministerial function. We disagree.

         As this Court explained in Stanford, the Supreme Court of Georgia, in a 1993 case, referred to a "nuisance exception" to sovereign immunity, declaring that

a municipality may be liable for damages caused from the operation or maintenance of a nuisance, irrespective of whether it is exercising a governmental or a ministerial function, because a municipal corporation can not, under the guise of performing a governmental function, create a nuisance dangerous to life and health or take or damage ...

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