June 9, 1989
Thomas E. Carr
Attorney at Law
907 State Street
P.O. Box 580
Belle Fourche, SD 57717-0580
OFFICIAL OPINION NO. 89-16
School District liability for acts of cooperative educational service units
Dear Mr. Carr:
On behalf of the Black Hills Special Services Cooperative, you have been instructed to request my opinion concerning the following situation:
FACTS:
The Black Hills Special Services Cooperative (Coop) is a cooperative educational service unit established pursuant to SDCL 13-5-31. The agreement establishing the Black Hills Special Services Cooperative has been filed with and approved by the South Dakota State Superintendent of Education. At the present time there are twelve individual school districts that are members of the Coop. Pursuant to the terms of the cooperative agreement, the Cooperative is engaged in numerous activities consistent with the overall objectives of the Coop.
The governing board of the Coop is composed of one voting school board member from each member school district. Each member board representative to the Coop governing board is appointed by the local member school board at its annual meeting.
QUESTIONS:
1. Do the individual member school districts of a cooperative educational service unit have any liability exposure arising from acts of the cooperative?
2. Do the individuals of the cooperative governing board have any individual liability exposure for any resulting cooperative liability?
BACKGROUND:
In 1979 Cooperative education units were first established through passage of SDCL 13-37-14.2 in order to allow school districts to band together to provide special education services. In 1980 cooperative educational units were allowed to be established for general purposes other than special education through passage of SDCL 13-5-31 and 32. In 1986 the Legislature rewrote SDCL 13-5-31 regarding the method of placing districts into cooperative education service units and establishing procedural guidelines. The essential power and authority of these entities is set forth in SDCL 13-5-32 and 33. Those statutes provide:
13-5-32. A cooperative educational service unit may carry out the services stated in the cooperative agreement but shall have no authority to levy taxes or issue bonds.
13-5-33. Cooperative service units created pursuant to this chapter or 13-37-14.2 shall comply with school district requirements regarding bookkeeping, record maintenance, board meetings, publication of minutes, health and safety requirements, bid laws, teacher termination and nonrenewal, and such other requirements as the South Dakota board of education may impose. Cooperative service units shall comply with budget procedures, except no tax levy may be transmitted to the county commissioners.
Given the language set out above and the fact that the authorizing legislation is found in SDCL ch. 13-5 dealing as it does with the creation and identification of school districts, I am of the opinion that the Legislature intended to enable cooperative units to be virtual school districts. Although coops are derivative of school districts, nevertheless, they exercise all the authority, and must meet all the statutory responsibilities of school districts with the exception that they cannot issue bonds nor levy taxes. Since SDCL 13-5-33 imposes school district requirements upon cooperative educational service units, I see no reason why they should be treated differently from school districts when considering their exposure to liability and enjoyment of protections such as governmental or sovereign immunity.
IN RE QUESTION NO. 1:
This question addresses the potential for liability against a school district as an entity. While the South Dakota Supreme Court has evidenced a certain amount of inconsistency in addressing the subject of sovereign immunity throughout the years, the immunity of school districts themselves, as opposed to the immunity of officers or employees, has remained firm. In the recent case of Bego v. Gordon, 407 N.W.2d 801 (S.D. 1987) the South Dakota Supreme Court addressed the liability of a school district and district employees. The Court held:
In summary, school districts, as state agencies, enjoy sovereign immunity from court liability absent an express consent from the Legislature. S.D. Const. art. III, 27; High-Grade Oil, 295 N.W.2d at 738. No express legislative consent has been given to expose the District's tort liability. "We have consistently held that if there is to be a departure from the immunity rule, the policy must be declared and the extent of liability fixed by the Legislature." Merrill v. Birhanzel, 310 N.W.2d at 524. Bego, 407 N.W.2d at 805.
See also, Holland v. Yankton School District, 375 N.W.2d 199 (S.D. 1985), holding that school districts are entitled to absolute sovereign immunity in tort actions within this State.
Clearly, the school districts that have entered into an agreement to establish the Black Hills Special Services Cooperative acted as sovereign entities in the exercise of authority directly granted by the Legislature. Since districts are absolutely immune from suit, unless their immunity has been waived to the extent that insurance has been purchased and coverage is afforded thereunder SDCL 21-32A-3, and since the member districts thereafter do not have authority to approve or disapprove particular acts of the cooperative, the doctrine of sovereign immunity should defeat any attempt to attach liability to the member school district for acts of the cooperative.
In this situation there is even an additional line of defense. As noted above, educational services cooperatives have virtually all of the attributes of school districts. Since the Legislature has indicated no intent whatever that cooperatives be treated differently from districts in regard to their liability, there should be no basis for attaching liability to the Black Hills Special Services Cooperative as an entity in the first place. If liability cannot attach to the cooperative entity, it is even less possible that it could pass through to a school district.
Of course, to the extent that a cooperative does incur an obligation to pay damages or rectify any other deficit, the agreement among the school districts creating the cooperative will control the extent to which member districts may be obliged to respond to matters for which the cooperative is responsible. This is, however, contractual liability as opposed to tort liability and beyond the scope of this opinion.
My answer to Question 1 is that member school districts are not liable for liability resulting from actions of educational cooperatives except to the extent they have agreed to assume such liability.
IN RE QUESTION NO. 2:
In the Merrill case cited above, the Pierre school district and certain employees were sued by a wrestler who was injured during practice. A claim was also made against the school district; however, no claims were made against individual board members. Likewise in the Bego case, an employee claimed that the school superintendent and principal committed various intentional torts against him but no claim was made against individual school board members. In fact, it would be the very rare instance where liability for tort actions would devolve upon an individual school board member. Nevertheless, our Court has held "A school district official who commits an intentional tort or acts ultra vires exceeds the scope of his official authority and will not be shielded by immunity," Schornack v. School District No. 17-2 of Brown County, 64 S.D. 215 at 217, 266 N.W. 141 at 142; and Bego, 407 N.W.2d at 808. Accordingly, in the event an individual cooperative governing board member were to commit an intentional tort or act beyond the scope of his official authority, he or she would not be immune from liability exposure.
The nature and extent of this exposure to liability does not differ in any material respect from the liability exposure to which the individual board member is subjected as a member of his local school district board. This board member's exposure, whether on his school district board or the cooperative educational service unit's governing board, extends to intentional tort and unauthorized acts as well as federal civil rights liability for damages that may attach pursuant to 42 U.S.C. 1983. Although liability insurance is probably not available for intentional torts and ultra vires acts, it is available to cover what federal liability may be present in the school setting. School districts and educational service cooperatives would be well advised to carry adequate errors and omissions insurance to cover this exposure.
My answer to Question No. 2 is that the liability of individual board members on cooperative governing boards is no different from the type of liability experienced by individual board members on their local boards.
Respectfully submitted,
ROGER A. TELLINGHUISEN
ATTORNEY GENERAL
RAT:ss
