No sovereign immunity for community services board

Where appellant was molested by an employee of a community mental health services board, the circuit court incorrectly granted the board’s plea in bar after concluding that the board was entitled to sovereign immunity from appellant’s simple negligence claim.

The board has insufficient attributes to be a municipal corporation.

Statement of the case

The Rappahannock Area Community Services Board provides mental health and intellectual disabilities, and drug abuse programs for Fredericksburg and four counties. Between 2001 and 2004, when appellant Fines was between six and eight years old, RACSB provided psychological services. Fines alleges that a therapist, Henry, molested him many times, inflicting mental and emotional injuries.

In 2015, Fines sued Henry’s estate and RACSB, pleading vicarious liability, two intentional torts and three negligence claims. At issue is RACSB’s plea in bar, based on sovereign immunity, to Fines’ claims.

The circuit court determined that RACSB was a municipal corporation after applying “the two-factor test developed … in Hampton Roads Sanitation Dist. Comm’n v. Smith, 193 Va. 371 (1952).”

Fines appealed.

Not municipal

“Fines argues that the circuit court erred in granting the plea in bar because RACSB does not possess sufficient attributes of a municipal corporation and, therefore, it is not entitled to sovereign immunity.

“According to Fines, RACSB is a multi-jurisdictional community services board that only exercises some limited governmental powers and it is not a municipal corporation because it lacks the fundamental characteristics of such an entity. We agree. …

“[O]ur analysis in this case is limited only to whether an operating community services board may be immune from tort liability.”

The Hampton Roads two-factor test first “requires courts to look at ‘how many attributes of a municipal corporation does the entity in dispute possess.’ … The second factor asks, ‘in the light of this initial consideration, what is the particular purpose for which it is sought to determine whether or not a municipal corporation is present?’”

Six factors control the determination whether an entity is a municipal corporation. “It is not essential that an entity possess all of these attributes to qualify as a municipal corporation; rather, we have held that an entity may be deemed a municipal corporation ‘if it possesses enough of the essential attributes.’ …

“The first attribute examines whether the entity was specifically created as a body corporate and politic and as a political subdivision of the Commonwealth. Here, we note that language designating community services boards as a body corporate or politic or as a political subdivision is conspicuously absent from the enabling legislation[.] …

“RACSB fails to satisfy the requirements of the first attribute.

“RACSB clearly satisfies the second attribute, however, as it was created to fulfill a public purpose. Code § 37.2-500(A) indicates that the purpose of community services boards like RACSB is to provide ‘mental health, developmental, and substance abuse services in the Commonwealth.’ It is readily apparent that such services necessarily serve a public purpose.”

Regarding the third factor, a community services board must have the ability to make contracts and to acquire, hold and dispose of real property. The enabling legislation does not grant powers related to real property.

Moreover, RACSB’s powers are limited “are severely limited in that it can only operate within parameters set by the governing bodies of its establishing localities. For example, Code § 37.2-504(A)(8) grants RACSB the power to ‘[a]ccept or refuse gifts, donations, bequests, or grants of money or property from any source and utilize them as authorized by the governing body of each city or county that established it.’ (Emphasis added.)

“For similar reasons, the fifth attribute is also only partially satisfied. Although RACSB was granted the power to borrow money, it cannot exercise that power independent of its establishing localities. …

“With regard to the fourth attribute, RACSB concedes that it does not possess the power of eminent domain and nothing in the enabling legislation contradicts that concession. Finally, it is apparent that RACSB satisfies the sixth attribute, as the record establishes that its management is vested in a board of directors. …

“RACSB only fully possesses attributes two and six. A close reading of our prior cases indicates that the more statutory autonomy the entity possesses and exercises the more likely it is to be declared a municipal corporation. … Thus, RACSB looks less like a municipal corporation and more like an auxiliary of the establishing localities.

“However, that does not end our inquiry. We must next consider the second factor: ‘in light of th[e] initial consideration, the particular purpose for determining whether a municipal corporation is present.’ …

“‘Generally, if the pivotal point under consideration involves a matter of procedure, there is more likelihood that a particular entity will be declared a municipal corporation, but if a point of substantive law is involved, it is less likely that the entity will be declared a municipal corporation.’ …

“The pivotal point in this case is whether RACSB is immune from tort liability. Although we have never specifically identified whether immunity from tort liability is a substantive or procedural matter, we are guided by the fact that federal courts have consistently described ‘the nature and scope of a claimed immunity’ as a matter of ‘substantive’ state law.”

Conclusion

“Given that RACSB lacks sufficient attributes of a municipal corporation, and the pivotal point of this case involves a matter of substantive law, we are of the opinion that RACSB is not a municipal corporation. Therefore, the circuit court erred in granting the plea in bar based upon RACSB being a municipal corporation.”

Reversed.

Fines v. Rappahannock Area Community Services Board, Record No. 210501; (Powell) Sept. 8, 2022. From the Circuit Court of King George County (Hewitt) Earl N. “Trey” Mayfield III, Christopher M. Day for appellant, Audra M. Dickens for appellee. VLW 022-6-042, 13 pp.