Craw v. City of Lincoln ( 2017 )

Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
06/27/2017 01:08 AM CDT
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Nebraska Court of A ppeals A dvance Sheets
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CRAW v. CITY OF LINCOLN
Cite as 24 Neb. Ct. App. 788
John Craw, appellant, v. City of Lincoln,
Nebraska, and John and Jane Doe(s)
1 through 10, appellees.
___ N.W.2d ___
Filed June 20, 2017. No. A-15-1070.
1. Motions to Dismiss: Pleadings: Appeal and Error. An appellate court
reviews a district court’s order granting a motion to dismiss de novo,
accepting all allegations in the complaint as true and drawing all reason-
able inferences in favor of the nonmoving party.
2. Motions to Dismiss: Pleadings. To prevail against a motion to dis-
miss for failure to state a claim, a plaintiff must allege sufficient facts,
accepted as true, to state a claim to relief that is plausible on its face.
In cases in which a plaintiff does not or cannot allege specific facts
showing a necessary element, the factual allegations, taken as true, are
nonetheless plausible if they suggest the existence of the element and
raise a reasonable expectation that discovery will reveal evidence of the
element or claim.
3. Actions: Pleadings: Notice. Civil actions are controlled by a liberal
pleading regime; a party is only required to set forth a short and plain
statement of the claim showing that the pleader is entitled to relief and
is not required to plead legal theories or cite appropriate statutes so long
as the pleading gives fair notice of the claims asserted.
4. Actions: Pleadings. The rationale for a liberal notice pleading standard
in civil actions is that when a party has a valid claim, he or she should
recover on it regardless of a failure to perceive the true basis of the
claim at the pleading stage.
5. Political Subdivisions Tort Claims Act. The Political Subdivisions Tort
Claims Act specifically excludes claims arising out of any interference
with contract rights.
6. Property. A job is not the type of property for which inverse condem­
nation claims can be brought.
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7. Due Process: Public Officers and Employees: Property: Contracts:
Notice. A public employee’s due process rights arise from a con-
tractually created property right to continued employment. A public
employee with a property interest in his employment has the right to
due process of law, which requires that the employee be provided with
oral or written notice of the charges against him, an explanation of the
employer’s evidence, and an opportunity to explain his or her side of
the story.
8. Political Subdivisions Tort Claims Act: Wages. A timely filing of a
tort claim under the Political Subdivisions Tort Claims Act, Neb. Rev.
Stat. § 13-901 et seq. (Reissue 2012), is not sufficient to satisfy the
filing requirements of Neb. Rev. Stat. § 15-840 (Reissue 2012) for pur-
poses of the application of the Nebraska Wage Payment and Collection
Act, because the two underlying claims are separate and distinct.
Appeal from the District Court for Lancaster County:
A ndrew R. Jacobsen, Judge. Affirmed in part, and in part
reversed and remanded for further proceedings.
Terry K. Barber, of Barber & Barber, P.C., L.L.O., for
appellant.
Jeffery R. Kirkpatrick, Lincoln City Attorney, and Don W.
Taute for appellees.
Pirtle, Bishop, and A rterburn, Judges.
Bishop, Judge.
John Craw appeals from a district court order dismissing
with prejudice his amended complaint against the City of
Lincoln, Nebraska, and John and Jane Doe(s) 1 through 10,
who were “employees and/or agents of the City.” (The City
of Lincoln and John and Jane Doe(s) 1 through 10 will col-
lectively be referred to as “the City.”) We affirm in part the
district court’s dismissal, and in part reverse and remand for
further proceedings.
BACKGROUND
On October 30, 2013, Craw filed a complaint in the county
court for Lancaster County against the City alleging four
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CRAW v. CITY OF LINCOLN
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causes of action related to his employment and termination as
the “PGA Professional for Holmes Golf Course” in Lincoln.
His first cause of action alleged as follows: that he submit-
ted a claim to the City pursuant to the Political Subdivisions
Tort Claims Act (PSTCA), Neb. Rev. Stat. § 13-901 et seq.
(Reissue 2012), and his claim was denied; that “[d]uring the
course of his work and employment with the City,” Craw was
“misclassified as an independent contractor and was wrong-
fully terminated from his position as the PGA Professional
for the Holmes Golf Course, the last engagement for which
was to expire and/or be ready for renewal on April 30, 2012,”
and his last day was October 30, 2011; that due to the City’s
negligence, Craw was damaged; and that he incurred damages
including (1) past and future physical pain, mental suffering,
and emotional distress, (2) past and future inconvenience,
(3) damage to property, and (4) loss of use of property. His
second cause of action alleged that the City damaged his
property or property rights and deprived him of use of his
property, entitling him to compensation under Neb. Const.
art. I, § 21. His third cause of action alleged that he was
entitled to recovery for his property damage pursuant to Neb.
Rev. Stat. § 76-705 (Reissue 2009), because his property was
damaged for public use without a condemnation proceed-
ing. His fourth cause of action alleged “violations of the
rights guaranteed to him by the Nebraska and United States[]
Constitutions, by the statutes of the State of Nebraska and
of the United States of America, all as regards civil rights and/
or discrimination.”
On May 28, 2014, the City filed a motion to dismiss Craw’s
complaint pursuant to both Neb. Ct. R. Pldg. § 6-1112(b)(1)
(lack of subject matter jurisdiction) and § 6-1112(b)(6) (failure
to state claim upon which relief can be granted).
In a form journal entry and order filed on June 27, 2014, the
county court granted the City’s motion to dismiss. Craw was
granted 2 weeks to file an amended complaint or a motion to
transfer to the district court.
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CRAW v. CITY OF LINCOLN
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On July 11, 2014, Craw, pursuant to Neb. Rev. Stat.
§ 25-2706 (Reissue 2016), filed a request to transfer the pro-
ceedings to the district court for Lancaster County, because
the “relief requested, at least in part, is beyond the jurisdiction
of [the county court] and exclusively within the jurisdiction
of the District Court.” The request for transfer motion was
sustained on July 15. The proceedings were certified and
transferred to the district court by the deputy clerk of the
“Lancaster County Court” on August 29.
On September 23, 2014, the City filed a motion to dis-
miss Craw’s complaint in the district court pursuant to
§ 6-1112(b)(1) and (6).
In an order filed on April 10, 2015, the district court granted
the City’s motion to dismiss Craw’s complaint. The district
court found that it lacked subject matter jurisdiction over
Craw’s third cause of action (which the court determined was
a “statutory inverse condemnation claim”) because § 76-705
requires that such actions be taken in the county court. The
district court then found that Craw failed to state a claim upon
which relief could be granted with regard to his first, second,
and fourth causes of action, as discussed next.
The district court labeled Craw’s first cause of action a “tort
claim”; however, the district court “seriously question[ed]”
whether Craw had “actually pled a tort claim as opposed to a
claim based on contract.” It said:
The only well-pled factual allegation in the Complaint
is that [Craw’s] engagement as the Holmes Golf Course
PGA Professional was terminated prior to the time it
was set to expire and/or be renewed. [Craw’s] use of
the term “engagement” . . . suggests a contract-based
claim. However, [Craw] also seeks damages for physi-
cal pain, mental suffering, and emotional distress, which
suggest a tort claim. As it stands, the scant factual alle-
gations of the Complaint are insufficient to allow the
court to determine the true nature of [Craw’s] first cause
of action.
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The district court found that the “difficulty in determining the
type of claim that is actually pled” warranted dismissal with-
out prejudice of Craw’s first cause of action.
The district court described Craw’s second cause of action
as a “constitutional inverse condemnation claim,” and it found
that “[a]s alleged, [Craw’s] engagement as the Holmes Park
Golf Course PGA Professional is not the type of vested prop-
erty right for which [a constitutional] inverse condemnation
claim would lie” and such claim should be dismissed.
As for Craw’s fourth cause of action, the district court said
that it was “some sort of constitutional violation” claim and
that “[b]ecause [Craw] has not set forth any facts as to what
constitutional rights have been violated and in what manner by
[the City],” his conclusory allegations were insufficient to state
a plausible claim to relief “[e]ven with the more relaxed rules
of notice pleading that Nebraska now utilizes . . . .”
The district court granted the City’s motion to dismiss. Craw
was given 14 days to file an amended complaint, and the court
ordered that “[i]f no amended complaint is filed, then this case
will be dismissed with prejudice without further hearing of
the court.”
On April 24, 2015, Craw filed an amended complaint
against the City alleging the original four “cause[s] of action,”
but with some additional detail, and a fifth cause of action.
The causes of action set forth in the amended complaint
were as follows: (1) tort claim pursuant to the PSTCA,
(2) constitutional inverse condemnation, (3) statutory inverse
condemnation, (4) violation of the Due Process and Equal
Protection Clauses of the state and federal Constitutions, and
(5) violation of the Nebraska Wage Payment and Collection
Act, Neb. Rev. Stat. § 48-1228 et seq. (Reissue 2010 & Cum.
Supp. 2016).
On May 4, 2015, the City filed a motion to dismiss Craw’s
amended complaint pursuant to § 6-1112(b)(1), regarding
Craw’s third cause of action, and § 6-1112(b)(6), regard-
ing Craw’s first, second, and fourth causes of action. The
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City’s motion to dismiss did not mention Craw’s fifth cause
of action.
In an order filed on October 20, 2015, the district court
granted the City’s motion to dismiss. The district court found
that it lacked subject matter jurisdiction over Craw’s third
cause of action (statutory inverse condemnation claim pursu-
ant to § 76-705) for the same reasons as stated in the court’s
April order, that being that such actions must be taken in
county court.
Likewise, the court found that Craw’s second and fourth
causes of action failed to allege sufficient facts to state a
plausible claim for relief, just as it had found in its April
2015 order. With respect to the second cause of action (con-
stitutional inverse condemnation), the district court pointed
to the reasons set forth in its April order, wherein the court
found that “[a]s alleged, [Craw’s] engagement as the Holmes
Park Golf Course PGA Professional is not the type of vested
property right for which [a constitutional] inverse condemna-
tion claim would lie” and such claim should be dismissed.
With respect to the fourth cause of action (violation of his
rights under the state and federal Constitutions, specifically
his rights to due process and equal protection), the district
court found that Craw failed to allege any facts demonstrat-
ing that he had a protected property interest in his contin-
ued employment.
The district court went into a more detailed discussion
regarding Craw’s first and fifth causes of action. With regard
to the first cause of action (tort claim pursuant to the PSTCA),
the district court found the amended complaint lacked suffi-
cient allegations to show that the claim was one in tort rather
than contract. It said the primary well-pled factual allega-
tion—that Craw’s “‘engagement’” as the Holmes Golf Course
PGA Professional was terminated prior to the time it was to
expire and/or be renewed—suggests a contract-based claim.
The court found that Craw failed to allege sufficient facts to
show that the City owed him a duty based in either contract
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or tort and that therefore, Craw’s first cause of action failed to
state a claim for which relief may be granted.
With regard to Craw’s fifth cause of action (Nebraska Wage
Payment and Collection Act claim), the district court found
that Craw had not alleged that he complied with the statu-
tory prerequisites found in Neb. Rev. Stat. § 15-840 (Reissue
2012), which require a claimant to first present a written claim
to the City before filing a claim under the Nebraska Wage
Payment and Collection Act. The district court noted that if a
claim presented to the City pursuant to § 15-840 is disallowed,
then the claimant may appeal that determination to the district
court. The court said: “[Craw] has not alleged compliance with
the procedure set forth in . . . § 15-840. Rather, [Craw] has
only alleged that he, through his attorney, submitted his claim
to the City for damages under the PSTCA.” The court con-
cluded that Craw’s fifth cause of action failed to state a claim
upon which relief could be granted.
The district court granted the City’s motion to dismiss and
dismissed with prejudice Craw’s amended complaint. Craw
now appeals.
ASSIGNMENTS OF ERROR
Craw assigns, summarized and restated, that the district
court erred in determining that (1) it did not have subject mat-
ter jurisdiction over the statutory inverse condemnation claim,
(2) he failed to state a claim upon which relief could be granted
as to the other causes of action, (3) the amended complaint
should be dismissed with prejudice, and (4) “allowing further
amendment” of the complaint would be futile.
STANDARD OF REVIEW
[1] An appellate court reviews a district court’s order grant-
ing a motion to dismiss de novo, accepting all allegations in
the complaint as true and drawing all reasonable inferences in
favor of the nonmoving party. Jacob v. Nebraska Dept. of Corr.
Servs., 294 Neb. 735, 884 N.W.2d 687 (2016).
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ANALYSIS
[2] To prevail against a motion to dismiss for failure to
state a claim, a plaintiff must allege sufficient facts, accepted
as true, to state a claim to relief that is plausible on its face.
Tryon v. City of North Platte, 295 Neb. 706, 890 N.W.2d 784
(2017). In cases in which a plaintiff does not or cannot allege
specific facts showing a necessary element, the factual allega-
tions, taken as true, are nonetheless plausible if they suggest
the existence of the element and raise a reasonable expecta-
tion that discovery will reveal evidence of the element or
claim. Id.
[3,4] Nebraska is a notice pleading jurisdiction. Id. Civil
actions are controlled by a liberal pleading regime. Id. A party
is only required to set forth a short and plain statement of the
claim showing that the pleader is entitled to relief. Id. The
party is not required to plead legal theories or cite appropriate
statutes so long as the pleading gives fair notice of the claims
asserted. Id. Stated another way, fair notice that a claim exists,
not the authorizing statute or legal theory, is all that is required
to carry a valid claim at the pleading stage. Id. The rationale
for this liberal notice pleading standard is that when a party
has a valid claim, he or she should recover on it regardless of
a failure to perceive the true basis of the claim at the pleading
stage. Id.
In his amended complaint, Craw alleged that “[b]y defini-
tion” he was an “employee of the City,” but had been “misclas-
sified as an independent contractor and was wrongfully termi-
nated from his position as the PGA Professional for the Holmes
Golf Course, the last engagement for which was to expire and/
or be ready for renewal on April 30, 2012.” He alleged that
his “last day at the Holmes Golf course, as [a] professional,
was October 30, 2011.” He also mentioned some wrongdoing
that occurred during his “employment.” In his brief, he stated:
“Reduced to essentials, Craw complains against the City for
the manner in which his engagement as the PGA Professional
at Holmes was established, managed and terminated, by the
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City, especially in 2011, but prior to that time as well.” Brief
for appellant at 25. It is from these allegations that Craw’s
“successive causes of action, all of which are pleaded in the
alternative,” arise. Id. at 20.
First Cause of Action—
Tort or Contract?
In his amended complaint, Craw set forth several allegations
under the heading “First Cause of Action.” Among the allega-
tions were that he had submitted to the City, through its city
clerk, his claim for damages under the PSTCA, and the City
denied his claim; he was “[b]y definition” an “employee of the
City” (and he set forth more specific factual allegations as to
why he was an “employee”); during the course of his work and
employment with the City, he was “misclassified as an inde-
pendent contractor and was wrongfully terminated from his
position as the PGA Professional for the Holmes Golf Course,
the last engagement for which was to expire and/or be ready
for renewal on April 30, 2012,” and his last day as a profes-
sional was October 30, 2011. He further alleged that “[w]hile
the basic relationship may exist as an agreement or contract,
certain of the parties’ obligations toward the other sound in,
and are based upon the principles of negligence, which is to
say the law of torts is involved.” After setting forth the general
duties of an employer to an employee, he alleged that “[i]n
particular, the City had a duty with regard to Craw, to see to it
that he [was] properly categorized as [a] City employee[], and
a further duty of fair treatment.” He alleged that the City failed
to meet its duties and that as a “direct and proximate result,”
Craw suffered and incurred various damages, including past
and future physical pain, mental suffering, and emotional dis-
tress; inconvenience in the past and future; damage to property;
and loss of use of property.
The district court found that Craw’s amended complaint
lacked sufficient allegations to show that the claim was one in
tort rather than contract. It said:
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The primary well-pled factual allegation in the Amended
Complaint is that [Craw’s] “engagement” as the Holmes
Golf Course PGA Professional was terminated prior to
the time it was set to expire and/or be renewed. [Craw’s]
use of the term “engagement” . . . suggests a contract-
based claim. While [Craw] alleges that the City owed him
a duty to properly categorize him as an employee, the
nature of this duty must be considered in light of the fact
that [Craw’s] position with the City was the subject of an
“engagement” that could expire or be renewed. Without
any factual allegations regarding the nature of [Craw’s]
“engagement” with the City, the court cannot determine
whether any alleged duty on the part of the City to prop-
erly categorize [Craw] as an employee was encompassed
within the terms of [Craw’s] “engagement.”
The court found that Craw failed to allege sufficient facts to
show that the City owed him a duty based in either contract
or tort and that therefore, Craw’s first cause of action failed to
state a claim for which relief may be granted.
In his brief, Craw argues that “[t]he Amended Complaint
gives [the City] ‘fair notice of what the . . . claim is and the
grounds upon which it rests.’” Brief for appellant at 26. The
City argues: “It is clear that [Craw’s] ‘allegations’ cannot be
characterized as anything other than assertions, conclusions,
and threadbare recitals. They are form, but no substance.” Brief
for appellees at 13. The City further argues that “[e]ven accept-
ing any well pled allegations as true, it is quite evident that
[Craw] is not setting forth a cause of action based in tort, but
rather a cause of action based in contract.” Id. at 14.
In his brief, Craw stated that his first cause of action was a
tort claim. He alleged that he filed a claim with the City via
the PSTCA and that the City denied his claim. After setting
forth the general duties of an employer to an employee, he
alleged that “[i]n particular, the City had a duty with regard to
Craw, to see to it that he [was] properly categorized as [a] City
employee[], and a further duty of fair treatment.” He alleged
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that the City failed to meet its duties, and that as a “direct and
proximate result,” he was damaged. He asked for damages
including physical and mental suffering, which are tort-related
damages outside of contracted wage amounts.
[5] However, § 13-903(4) defines a “[t]ort claim” under
the PSTCA as “any claim against a political subdivision for
money only on account of damage to or loss of property or on
account of personal injury or death, caused by the negligent
or wrongful act or omission of any employee.” Clearly, there
has been no personal injury or death in the present matter.
Therefore, Craw’s alleged “loss” of employment would have
to qualify as a “loss of property” under the PSTCA. This court
declines to construe the statute in such a manner, particularly
where the allegations in this case rest on an “engagement”
between the parties sounding in contract, as the district court
likewise concluded. See Employers Reins. Corp. v. Santee
Pub. Sch. Dist. No. C-5, 231 Neb. 744, 438 N.W.2d 124
(1989) (claim based on breach of contract is not tort claim
under PSTCA). Even Craw admitted that “the basic relation-
ship may exist as an agreement or contract.” His allegations
that others may have negligently influenced that agreement
does not convert his contract claim into a tort claim, other
than perhaps to claim a tortious interference with his contract
rights. However, to the extent Craw claims his rights under the
terms of “engagement” were affected by negligent or wrong-
ful acts of any employees, the PSTCA specifically excludes
claims arising out of any “interference with contract rights.”
See § 13-910(7).
Accordingly, we agree with the district court that Craw’s
first cause of action failed to state a claim upon which relief
could be granted.
Second and Third Causes of Action—
Inverse Condemnation.
[6] In his second and third causes of action, Craw makes
inverse condemnation claims. More specifically, in his second
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cause of action, Craw alleged that the City “damaged the
property or property rights owned by [him]” and “deprived
[him] the use of his property,” thus entitling him to com-
pensation under Neb. Const. art. I, § 21. Neb. Const. art. I,
§ 21, provides: “The property of no person shall be taken or
damaged for public use without just compensation therefor.”
In his third cause of action, Craw alleged that pursuant to
§ 76-705, he is entitled to “recovery of his property damage
. . . as the City . . . damaged the property of Craw, for public
use, without instituting condemnation proceedings.” Section
76-705 provides:
If any condemner shall have taken or damaged prop-
erty for public use without instituting condemnation
proceedings, the condemnee, in addition to any other
available remedy, may file a petition with the county
judge of the county where the property or some part
thereof is situated to have the damages ascertained and
determined.
Based on the allegations set forth in his amended complaint,
the only “property” Craw could be referring to is his job at
Holmes Golf Course. However, that is not the type of “prop-
erty” for which inverse condemnation claims can be brought.
As stated by the Nebraska Supreme Court, “[I]nverse con-
demnation is a shorthand description for a landowner suit to
recover just compensation for a governmental taking of the
landowner’s property without the benefit of condemnation
proceedings.” Henderson v. City of Columbus, 285 Neb. 482,
488, 827 N.W.2d 486, 491-92 (2013). While most inverse con-
demnation claims involve the taking of land, we have found
cases addressing the “taking” of a job, but those claims were
not successful.
In Pittman v. Chicago Bd. of Educ., 64 F.3d 1098 (7th
Cir. 1995), one of the issues addressed was whether a princi-
pal’s property (statutory tenure) was taken without just com-
pensation in violation of the Fifth Amendment to the U.S.
Constitution, which provides in relevant part: “[N]or shall
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private property be taken for public use, without just compen-
sation.” The Seventh Circuit said:
Job tenure is for some purposes “property” within the
meaning of the Constitution, and the principals’ tenure
has been “taken.” But there is a missing link in the prin-
cipals’ alternative argument that this taking violates the
takings clause. Job tenure is property within the mean-
ing of the due process clauses . . . which protect people
against deprivations of life, liberty, or property without
due process of law. . . .
. . . But “property” as used in [the takings] clause
is defined much more narrowly than in the due proc­
ess clauses. It encompasses real property and personal
property, including intellectual property. . . . But in this
circuit anyway, though the Supreme Court left the issue
open in Connolly v. Pension Benefit Guaranty Corp.,
475 U.S. 211, 224, 106 S. Ct. 1018, 1025, 89 L. Ed. 2d
166 (1986) [regarding retroactive application of the with-
drawal liability provisions of the Multiemployer Pension
Plan Amendments], it does not extend to contracts . . . or
to statutory entitlements.
Pittman v. Chicago Bd. of Educ., 64 F.3d at 1104.
In Leach v. Texas Tech University, 335 S.W.3d 386 (Tex.
App. 2011), a former football coach brought an action against
the university and university officials for breach of contract,
violation of the whistleblower statute, and violation of the
takings clause. The district court dismissed all claims except
the breach of contract claim. On appeal, the Texas Court of
Appeals held in relevant part that the coach failed to state a
takings claim. The claims in question “involve[d] the purported
taking without compensation of [the coach’s] property and
his termination without due process.” Id. at 398. The takings
clause of Texas Const. art. I, § 17, states in relevant part that
“[n]o person’s property shall be taken, damaged, or destroyed
for or applied to public use without adequate compensation
being made, unless by the consent of such person . . . .” (This
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portion of the Texas Constitution is similar to the takings
clause in the Nebraska Constitution and the statutory language
in § 76-705.) The Texas Court of Appeals stated that the ele-
ments of a takings claim are not satisfied when the State with-
holds property in a contractual dispute.
This is apparently so because the party demanding com-
pensation after performing his contractual duty to pro-
vide goods or services actually provided those goods or
services voluntarily as opposed to being forced to do so
via the State’s power of eminent domain. . . . So, when
the State withholds property under color of a contractual
right, such as when it believes the contract was not prop-
erly performed, it is not acting as a sovereign invoking
powers of eminent domain, but rather as a private party
to a contract invoking rights expressed or implicit in the
contract. . . . Thus, the takings clause appearing under
Texas Constitution art. I, § 17 does not apply to contrac-
tual disputes.
Leach v. Texas Tech University, 335 S.W.3d at 398. The Texas
Court of Appeals stated that the compensation sought by and
allegedly due the coach is that which the university contracted
to pay him in return for his performance of services as the
coach, and the university purported to withhold compensation
because the coach failed to abide by the terms of their agree-
ment. The court held that “what we have here is nothing other
than a contractual dispute . . . which falls outside the takings
clause.” Id.
In Tracy v. City of Deshler, 253 Neb. 170, 171, 568 N.W.2d
903, 905 (1997), the owner of a garbage collection business
brought an action under Neb. Const. art. I, § 21, seeking com-
pensation for the alleged unconstitutional “‘taking’” of his
business by the City of Deshler. In January 1992, the owner
was granted a permit by the city to haul garbage “‘for the
year ending July 1, 1992,’” pursuant to the city’s municipal
codes. Tracy v. City of Deshler, 253 Neb. at 171, 568 N.W.2d
at 905. One such code provided that if the city entered into
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a contract for the citywide collection of garbage, all permits
previously issued to private garbage collectors, including the
permit issued to the owner, would expire immediately. The
city subsequently entered into a contract for citywide garbage
collection with one of the owner’s competitors. As a result, the
owner lost all of his garbage collection customers in the city.
The owner filed an action against the city, seeking compensa-
tion for the loss of his garbage collection business, arguing
that the loss of his business was a “taking” of property enti-
tling him to compensation. Id. The Nebraska Supreme Court
determined that the owner was engaged in a business that was
subject to a conditional permit and that thus, he did not have a
reasonable expectation of a continuing right to haul garbage in
the city for the purposes of a takings claim. The court held that
“payment of just compensation pursuant to Neb. Const. art. I,
§ 21, applies only to vested property rights, and a permit with
the type of restrictive conditions imposed by [city ordinance]
did not constitute a vested property right in any constitutional
sense.” Tracy v. City of Deshler, 253 Neb. at 176, 568 N.W.2d
at 908.
Finally, in Johnston v. Panhandle Co-op Assn., 225 Neb.
732, 743-44, 408 N.W.2d 261, 269 (1987), although in the con-
text of due process rather than a takings claim, the Nebraska
Supreme Court held that “[t]o have a property interest in
employment, a person must have a legitimate claim of entitle-
ment to it” and that “an employee at will . . . ha[s] no reason-
able expectation of continued employment or legitimate claim
of entitlement to it.”
Craw claims to have been an “employee” of the City. If
that is true, his employment appears to have been as a con-
tract employee based on the fact that the “last engagement . . .
was to expire and/or be ready for renewal on April 30, 2012.”
However, we note that at one point in his amended complaint,
Craw alleged that he was a “statutory employee.” Under either
scenario, any claim Craw has regarding his employment or
termination thereof falls outside of the takings clause. See,
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Pittman v. Chicago Bd. of Educ., 64 F.3d 1098 (7th Cir. 1995);
Leach v. Texas Tech University, 335 S.W.3d 386 (Tex. App.
2011). Because inverse condemnation does not apply to Craw’s
case, the district court properly dismissed with prejudice his
second and third causes of action and we need not address any
jurisdictional issues with regard to his inverse condemnation
claims. See Adair Asset Mgmt. v. Terry’s Legacy, 293 Neb.
32, 875 N.W.2d 421 (2016) (appellate court not obligated to
engage in analysis that is not necessary to adjudicate case and
controversy before it).
Fourth Cause of Action—Due Process
and Equal Protection.
In his fourth cause of action in his amended complaint,
Craw alleged violations of his constitutional rights to due
process and equal protection. Craw incorporated all preceding
paragraphs of his amended complaint into his fourth cause of
action; among those paragraphs was an allegation that “his
employment was public employment.” He then claimed:
[T]he foregoing constitute violations of the rights guar-
anteed to him by the Nebraska and United States[]
Constitutions, by the statutes of the State of Nebraska
and of the United States of America, all as regards civil
rights and/or discrimination. In particular, Craw claims,
(a) that his misclassification as an independent contrac-
tor, rather than a statutory employee, violated the due
process clauses of both the Nebraska and United States
Constitutions, as matters both of substance and proce-
dure; (b) that the manner in which his employment and/
or position was terminated or eliminated further violated
the due process clauses of both the Nebraska and United
States Constitutions, at least as a matter of procedure;
and, (c) that both the misclassification and termination
or job elimination violated the equal protection clauses
of both the Nebraska and United States Constitutions, in
that his treatment was, without cause, different and less
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favorable than other City employees or their comparable
persons, who were similarly situated.
See, U.S. Const. amend. XIV, § 1 (“nor shall any State deprive
any person of life, liberty, or property, without due process of
law; nor deny to any person within its jurisdiction the equal
protection of the laws”); Neb. Const. art. I, § 3 (“[n]o person
shall be deprived of life, liberty, or property, without due proc­
ess of law, nor be denied equal protection of the laws”).
In its order, the district court found that Craw’s fourth cause
of action failed to allege sufficient facts to state a plausible
claim for relief. Additionally, the court found that Craw failed to
allege any facts demonstrating that he had a protected property
interest in his continued employment. In support of its finding,
the district court cited to Hickey v. Civil Serv. Comm. of Douglas
Cty., 274 Neb. 554, 741 N.W.2d 649 (2007) (constitutional
due process protections apply when public employer deprives
employee of property interest in continued employment).
[7] A public employee’s due process rights arise from a con-
tractually created property right to continued employment. Scott
v. County of Richardson, 280 Neb. 694, 789 N.W.2d 44 (2010).
A public employee with a property interest in his employment
has the right to due process of law, which requires that the
employee be provided with oral or written notice of the charges
against him, an explanation of the employer’s evidence, and an
opportunity to explain his or her side of the story. Id.
The City claims that Craw “has provided no factual alle-
gations with respect to the nature of his ‘engagement’ and
without such factual allegations he has not sufficiently stated
a plausible claim for relief that he was a public employee and
therefore entitled to the protections of the Due Process clause”
prior to his termination. Brief for appellees at 18.
Craw’s failure to set forth the specific nature of the “engage-
ment” does not necessarily defeat Craw’s claim, at least for
the purpose of surviving a motion to dismiss. See Tryon v.
City of North Platte, 295 Neb. 706, 713, 890 N.W.2d 784, 789
(2017) (“[w]hile setting out the appropriate statute and the
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allegations regarding each element required therein would have
been helpful to appellees and the court, appellants’ failure to
do so does not defeat the presence of valid claims”). In cases
in which a plaintiff does not or cannot allege specific facts
showing a necessary element, the factual allegations, taken as
true, are nonetheless plausible if they suggest the existence of
the element and raise a reasonable expectation that discovery
will reveal evidence of the element or claim. Id. The nature
of Craw’s engagement would certainly be discoverable at a
later date. After the nature of his engagement and his employ-
ment classification is determined, then the issue of whether he
was a public employee with a property interest in his job can
be addressed.
We note that the district court did not specifically address
Craw’s equal protection claim in its order. The City’s brief
on appeal also ignores the issue. In Craw’s brief, he argues
that “[t]he Amended Complaint gives [the City] ‘fair notice of
what the . . . claim is and the grounds upon which it rests.’”
Brief for appellant at 26. Although his amended complaint did
not allege specific facts as to how “his treatment was, without
cause, different and less favorable than other City employees
or their comparable persons, who were similarly situated,”
there is a reasonable expectation that discovery will reveal
evidence of the claim. See Tryon, supra.
While Craw’s ability to successfully litigate a suit for due
process and equal protection violations is yet to be determined,
we find that he has provided fair notice of his claims, which is
all that is required at the pleading stage. See id. Accordingly,
the district court erred in finding that Craw’s fourth cause
of action failed to state a claim upon which relief could
be granted.
Fifth Cause of Action—Nebraska Wage
Payment and Collection Act.
In his fifth cause of action in his amended complaint,
Craw alleged violations of the Nebraska Wage Payment
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and Collection Act, § 48-1228 et seq. The Nebraska Wage
Payment and Collection Act provides in relevant part that “[a]n
employee having a claim for wages which are not paid within
thirty days of the regular payday designated or agreed upon
may institute suit for such unpaid wages in the proper court.”
§ 48-1231(1). Both “[e]mployee” and “[w]ages” are statutorily
defined. § 48-1229. In particular, Craw claims that “his mis-
classification by the City resulted in a substantial underpay-
ment by the City of compensation to him and to others working
at the golf course, both as to primary compensation and as to
other benefits of City employment, all in such amount as is
proven at trial.”
The City’s motion to dismiss did not mention Craw’s fifth
cause of action. However, the district court found that Craw’s
fifth cause of action failed to state a claim upon which relief
could be granted because Craw failed to allege facts show-
ing that he complied with the statutory prerequisites to bring
such a claim. Specifically, the district court found that Craw
had not alleged compliance with the procedure set forth in
§ 15-840 for filing a contract claim against a city of the pri-
mary class, like the City herein.
Section 15-840 provides:
All liquidated and unliquidated claims and accounts
payable against the city shall: (1) Be presented in writing;
(2) state the name of the claimant and the amount of the
claim; and (3) fully and accurately identify the items or
services for which payment is claimed or the time, place,
nature, and circumstances giving rise to the claim. The
finance director shall be responsible for the preauditing
and approval of all claims and accounts payable, and
no warrant in payment of any claim or account payable
shall be drawn or paid without such approval. In order to
maintain an action for a claim, other than a tort claim as
defined in section 13-903, it shall be necessary, as a con-
dition precedent, that the claimant file such claim within
one year of the accrual thereof, in the office of the city
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clerk, or other official whose duty it is to maintain the
official records of a primary-class city.
(Emphasis supplied.) And Neb. Rev. Stat. § 15-841 (Reissue
2012) allows for an appeal to the district court after disal-
lowance of a claim under § 15-840. Furthermore, in an action
against a city of the primary class, an application of the
Nebraska Wage Payment and Collection Act would not alter
the need to satisfy the prerequisites of the claims statutes
contained in §§ 15-840 and 15-841. See, Rauscher v. City of
Lincoln, 269 Neb. 267, 691 N.W.2d 844 (2005); Thompson v.
City of Omaha, 235 Neb. 346, 455 N.W.2d 538 (1990).
The district court determined that Craw’s fifth cause of
action under the Nebraska Wage and Payment Collection Act
failed to state a plausible claim for relief, because Craw had
not alleged compliance with the prerequisites for bringing
such a claim, and the district court dismissed the claim with
prejudice. We find the dismissal with prejudice was error,
because Craw should have been provided an opportunity to
amend his pleading to cure this defect, to the extent he can
do so.
[8] We note that Craw contends that he did file a timely
claim with the City and that the amended complaint “alleges
Craw’s claim was timely filed under the tort claim statutes,
Neb. Rev. Stat. §§ 13-901 et seq.” Reply brief for appellant
at 6. But contrary to Craw’s assertion, a timely filing of a tort
claim with the City under the PSTCA, § 13-901 et seq., is not
sufficient to satisfy the filing requirements of § 15-840 for
purposes of the application of the Nebraska Wage Payment
and Collection Act, because the two underlying claims are
separate and distinct. For purposes of the PSTCA, a “[t]ort
claim shall mean any claim against a political subdivision for
money only on account of damage to or loss of property or on
account of personal injury or death, caused by the negligent
or wrongful act or omission of any employee of the political
subdivision . . . . ” § 13-903. The Nebraska Wage Payment
and Collection Act allows an employee to file a claim for
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unpaid wages. See, also, Andrews v. City of Lincoln, 224 Neb.
748, 751, 401 N.W.2d 467, 469 (1987) (§ 15-840 “prescribes
a procedural prerequisite concerning contract claims, liqui-
dated or unliquidated, against a city of the primary class”).
Accordingly, a claim for one is not a claim for the other. To
the extent that Craw may have filed a notice of his claim
for unpaid wages with the City, apart from his tort claim, he
should at least have an opportunity to amend his complaint to
show such compliance.
To the extent Craw is able to plead procedural compliance
with § 15-840, as discussed above, we address the City’s addi-
tional argument that Craw “provided no facts to establish that
he was an employee within the meaning of the Wage Payment
and Collection Act.” Brief for appellees at 19. For purposes of
the Nebraska Wage Payment and Collection Act, an
[e]mployee means any individual permitted to work by
an employer pursuant to an employment relationship or
who has contracted to sell the goods or services of an
employer and to be compensated by commission. Services
performed by an individual for an employer shall be
deemed to be employment, unless it is shown that (a)
such individual has been and will continue to be free
from control or direction over the performance of such
services, both under his or her contract of service and in
fact, (b) such service is either outside the usual course
of business for which such service is performed or such
service is performed outside of all the places of business
of the enterprise for which such service is performed,
and (c) such individual is customarily engaged in an
independently established trade, occupation, profession,
or business.
§ 48-1229. In his amended complaint, Craw alleged that he
was “[b]y definition” an “employee of the City,” and he set
forth more specific factual allegations as to why he was an
“employee.” Among those allegations, he claimed that the City,
at all times, “maintained and exercised extensive control” over
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Craw; the City “intended Craw’s employment to be long-term
at the time he was first hired”; and a “significant majority”
of Craw’s responsibilities were mid-managerial and “he was
allowed to exercise little, if any, independent judgment.” He
further alleges that his “misclassification” by the City resulted
in a substantial underpayment of compensation to him. While
the nature of Craw’s relationship with the City and his abil-
ity to successfully litigate a suit for unpaid wages under the
Nebraska Wage Payment and Collection Act are yet to be
determined, the allegations as to his “employee” status are suf-
ficient for purposes of pleading. But as previously discussed,
this is only relevant so long as there has been proper proce-
dural compliance.
CONCLUSION
For the reasons stated above, we find that the district court
properly dismissed with prejudice Craw’s first cause of action
for an alleged tort claim under the PSTCA and Craw’s second
and third causes of action for inverse condemnation; we affirm
those portions of the district court’s order. However, we find
that the district court erred in dismissing Craw’s fourth cause
of action (due process and equal protection) because Craw
provided fair notice of that claim, which is all that is required
at the pleading stage. We reverse the dismissal with prejudice
of Craw’s fifth cause of action (Nebraska Wage Payment and
Collection Act) only insofar as Craw was not provided an
opportunity to amend his pleading to address the procedural
prerequisites noted by the district court’s order; we otherwise
affirm the district court’s determination as to those procedural
prerequisites. Accordingly, we reverse the district court’s dis-
missal of Craw’s fourth and fifth causes of action and remand
the matter for further proceedings.
A ffirmed in part, and in part reversed and
remanded for further proceedings.