Sunday, August 26, 2012, 10:31 PM

NC Supreme Court: In considering applicability of governmental immunity, analysis of whether function is governmental or proprietary must start with relevant legislation

On Friday, in the case of Estate of Williams v. Pasquotank County Parks & Recreation Department and Pasquotank County, the Supreme Court restated the principles applicable to an analysis of whether counties and municipal corporations are entitled to governmental immunity.  Womble Carlyle's Burley Mitchell and Robert Numbers represented the defendants in their appeal to the Supreme Court.

On June 10, 2007, Erik Dominic Williams drowned at Fun Junktion, a public park owned by defendant Pasquotank County and maintained and operated by defendant Pasquotank County Parks & Recreation Department.  Williams's estate later sued the defendants, alleging that their negligence resulted in his death at the "Swimming Hole," an area of the park that was rented out to private parties.

The trial court ruled that the defendants were not entitled to governmental immunity, a doctrine under which counties and municipal corporations are immune from suits based on their employees' negligence in performing governmental (as opposed to proprietary) functions unless there has been a waiver of immunity.  Governmental functions are those which are “discretionary, political, legislative, or public in nature and performed for the public good in behalf of the State rather than for itself,” whereas proprietary functions are those which are “commercial or chiefly for the private advantage of the compact community.”

The defendants appealed to the Court of Appeals.  In a unanimous decision, the COA affirmed the denial of summary judgment for the defendants, concluding that the defendants were engaged in a proprietary function because the services they provided could also be provided by private entities.

The defendants then petitioned the Supreme Court for discretionary review, which the Court granted.  Recognizing the increasing difficulty in identifying services that can only be provided by a governmental entity, the Court explained the inquiry to be applied when distinguishing between governmental and proprietary functions.

The threshold inquiry is whether the legislature has addressed the issue.  If the legislature has not resolved the question, then the court looks to other factors.  If the undertaking is one in which only a governmental agency could engage, it is a governmental function.  However, if the service can be performed by governmental or private entities, then the court must consider whether the service is traditionally a service provided by a governmental entity, whether a substantial fee is charged for the service provided, and whether that fee does more than simply cover the operating costs of the service provider.  The Court cautioned that no single factor is dispositive, and emphasized that the governmental-vs.-proprietary question is a fact-sensitive analysis that may vary from case to case.

The Court determined that remand was necessary because the COA had not sufficiently addressed North Carolina's Recreation Enabling Law, N.C. Gen. Stat. § 160A-351, which was relevant to determining whether the defendants' maintenance and operation of the Swimming Hole was a governmental or proprietary function.  The Court explained that even if, under the statute, the operation of parks and recreation programs is generally a governmental function, the question remains whether the specific operation of the Swimming Hole at Fun Junktion, under the circumstances particular to this case, is a governmental function.  Accordingly, the Court expressed no opinion on whether the defendants are ultimately entitled to governmental immunity, but remanded to the COA for further remand to the trial court to consider the application of N.C. Gen. Stat. § 160A-351 to this case.

Related links: Parties' and amicus briefs; COA opinion.

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