Like many of the issues surrounding the so-called Beatrice 6 case, the idea that Gage County could ask the state for a loan to pay a $28.1 million federal jury award is without any sort of precedent.
The mechanism for getting the loan and paying it back is simple enough.
Any Nebraska political subdivision ordered to pay a court judgment can apply to the State Treasurer's Office for a loan of “sufficient funds to pay any judgment in its entirety,” then pay it back at one-half of 1 percent interest.
The idea was broached last week by Jeffry Patterson, one of the attorneys representing six people convicted of murder after a 1989 cold case investigation into the rape and beating death of Helen Wilson in her downtown Beatrice apartment.
Joseph White, Ada JoAnn Taylor, Thomas Winslow, James Dean, Kathleen Gonzalez and Debra Shelden spent a combined 75 years in prison until DNA evidence pointed to a seventh person, and they were exonerated.
The six sued Gage County, Deputy Sheriff Burdette Searcey, Reserve Deputy Wayne Price and others for violating their civil rights, and in July a federal jury awarded them $28.1 million, plus attorneys’ fees.
Patterson made the suggestion to Gage County’s team of private-practice attorneys in a letter copied to Gov. Pete Ricketts, Sens. John Stinner of Gering and Roy Baker of Lincoln, State Treasurer Don Stenberg and others.
Gage County has not replied to the letter, nor has it applied with the treasurer's office for a loan covering any or all of the judgment, Stenberg said. He did say that he discussed the issue last week with Patrick O’Brien, one of the attorneys representing Gage County.
In fact, no application for a loan has ever been made to the treasurer since Gov. Norbert Tiemann signed the Political Subdivision Tort Claims Act into law nearly a half century ago.
That leaves attorneys and public officials little in the way of guidance.
Stenberg said he asked Attorney General Doug Peterson for his opinion Friday on how the law may apply to Gage County’s circumstances.
“My main question to the attorney general was if this statute applies to a federal judgment,” Stenberg said Monday.
Since being signed into law in 1969, the Political Subdivision Tort Claims Act has been applied to civil cases brought against cities, counties, school districts and other entities in state court.
It was introduced alongside the State Tort Claims Act by then-Sen. Roland Luedtke of Lincoln and “intended to abolish the doctrine of sovereign or governmental immunity” by governmental entities in Nebraska.
A Federal Tort Claims Act allowing citizens to pursue some claims against the federal government was enacted in 1946.
During floor debate, Luedtke, a former Lincoln mayor and Nebraska lieutenant governor, said that for more than a century after the state Constitution was ratified, Nebraska and its subdivisions operated on a “king can do no wrong” position of governmental immunity that limited recourse in the event of injury or other damages.
Claims filed against Nebraska school boards and the city of Omaha, and Nebraska Supreme Court rulings weakened the idea of governmental immunity and brought attention to the issue, which was later the subject of an interim study.
The act established a uniform method for bringing lawsuits against subdivisions and outlined a two-year statute of limitations for a claim to be made.
The final part of the law gave governmental entities in Nebraska the option of applying for low-interest loans from the treasurer's office to pay any claims awarded to citizens by a court if they could not pay the claims through insurance or other remedies described by law.
“Because of the constitutional limitations on expenditures and the like, we realize that (governmental entities) could have a very catastrophic loss, a negligence claim, which would result in a judgment which perhaps a local subdivision of government could not even meet,” Luedtke told the Judiciary Committee during a 1969 hearing.
But it appears the Political Subdivision Tort Claims Act applies to damages awarded in state court and not under federal law, Stenberg said, meaning his office might not have authority to give a loan to Gage County.
He said it's also unclear whether any loan his office could grant to Gage County would be capped at $5 million. The Political Subdivision Tort Claims Act caps payouts for claims at $5 million per occurrence under the law but does not assign a cap to the loan amount.
“Given those limits, the Legislature’s intent may have been to limit any loan to the maximum amount of recovered allowed under the Political Subdivision Tort Claims Act,” Stenberg wrote.
His final question to Peterson centered on what options Gage County may have with his office if the Political Subdivisions Tort Claim Act does not apply to the case.
“(Is) there any other statute that would authorize the State Treasurer to make a loan to Gage County related to the judgments in question?” he asked.
Peterson's spokeswoman Suzanne Gage said late Monday that the attorney general will "respond as expeditiously as possible" to Stenberg's request.
In his letter to Gage County, Patterson said his clients would consent to a stay on collecting the nearly $30 million if the county "were able to guarantee prompt payment" if the 8th Circuit Court of Appeals finds in their favor.