This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (1996).




Audrey B. Kline,



Grace Petri, et al.,


Filed August 12, 1997

Affirmed in Part and Reversed in Part

Davies, Judge

St. Louis County District Court

File No. C196100308

Rodney G. Otterness, Kent E. Nyberg Law Office, Ltd., 20 NE Fourth St., Suite 101, Grand Rapids, MN 55744 (for Respondent)

Alan L. Mitchell, St. Louis County Attorney, Timothy O. Lee, Assistant County Attorney, 100 North Fifth Ave. W., #501, Duluth, MN 55802-1298 (for Appellant)

Considered and decided by Parker, Presiding Judge, Huspeni, Judge, and Davies, Judge.



Appellants challenge the district court's denial of their immunity-based motion for summary judgment on two claims against them. Respondent, by notice of review, challenges the district court's grant of summary judgment on her other two claims and its denial of her motion to amend the complaint to add a claim for punitive damages. We affirm in part and reverse in part, dismissing all of respondent's claims.


Appellant Jane Fleskes is employed by appellant St. Louis County in the licensing unit for adult foster care. Her duties include providing information to people who want to become licensed adult foster care providers, going through the licensing process with applicants, and developing and delivering part of the training for licensed providers. She is a representative of the Department of Human Services in her licensing functions. She is also responsible for coordinating information with case managers. In this function, she develops a list of available foster homes, which is provided to case managers and others interested in adult foster care services. Although the list is to be updated each month, that is not always done.

Appellant Grace Petri works for the county as a supervisor in the area of services for senior adults. She does not maintain her own client caseload but rather supervises the case managers.

Respondent Audrey B. Kline became a licensed adult foster care provider for the county in August 1993. Her license application included her son as a care provider, but he was disqualified because a social worker for the county substantiated allegations that Kline's son had sexually abused his daughter. A license was issued conditioned on the son's absence from the home.

In late November 1993, appellant Fleskes received a report that Kline's son was back in Kline's home. After consulting with the county attorney, Fleskes contacted Kline by letter dated December 2 inquiring about the situation. In her response, dated December 7, Kline stated that her son was residing with his wife. This surprised Fleskes because it was inconsistent with the information Kline had given her in a telephone call on December 2. On December 7, Fleskes received further information from appellant Petri suggesting that Kline's son was back in Kline's home.

In January 1994, an investigator from the county attorney's office reported to Fleskes that Kline's son had been living at the home from December 10 into the new year and had never lived in a neighboring community as Kline had previously reported. On January 23, Fleskes received documentation that Kline's son had been in and out of Kline's home. On January 27, Fleskes learned from the investigator that Kline's son had moved into the home on January 22 and then moved back to his wife's residence on January 25.

Fleskes put the words "on hold" next to Kline's name on the February 1994 list of available care providers. The words also appeared on the March list.[1] There was no new list in April. The May list did not include the words and showed two openings at Kline's residence.

At a February 1994 meeting between Petri and her staff of case managers, she advised them that the Kline home should not be used. During the summer, one case manager was again told not to use the Kline home and she wrote "do not use" on her copy of the list of available homes. She indicated in her affidavit that she was told the policy not to use the Kline home was "not on paper." A woman who was seeking placement for her brother in August 1994 states in her affidavit that the words "don't use" appeared next to Kline's name on the list she was given and that the Kline home was not included in a book with pictures of available foster homes.

In September 1995, Kline brought suit against appellants, claiming breach of contract, tortious interference with prospective business relations, defamation, and suspension of license without due process. Appellants brought a motion for summary judgment, and Kline moved to amend the complaint to add a claim for punitive damages. The district court, ruling that there was no genuine issue of material fact as to the breach of contract and defamation claims, granted summary judgment in favor of appellants on those counts. The district court denied appellants' motion for summary judgment as to the tortious interference and due process claims, ruling that there were material fact issues. Finally, the district court denied respondent's motion to amend the complaint to include a claim for punitive damages.

Appellants here challenge the denial of summary judgment on the tortious interference and due process claims, arguing that they are protected by official immunity. Respondent, by notice of review, challenges the dismissal of the contract and defamation claims and the refusal to allow amendment of the complaint to add a punitive damages claim.


On appeals from summary judgments, this court must consider two questions:

(1) whether there are any genuine issues of material fact and (2) whether the lower courts erred in their application of the law.

State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990). An issue of fact is material if it would affect the outcome of the case. Zappa v. Fahey, 310 Minn. 555, 556, 245 N.W.2d 258, 259-60 (1976). The evidence is to be viewed in the light most favorable to the non-moving party. Fabio v. Bellomo, 504 N.W.2d 758, 761 (Minn. 1993). "A reviewing court is not bound by the district court's determination of a purely legal issue." Summit House Co. v. Gershman, 502 N.W.2d 422, 423-24 (Minn. App. 1993).

I. Official Immunity

A public official whose duties require the exercise of judgment or discretion is entitled to official immunity unless the official committed a willful or malicious wrong. Elwood v. County of Rice, 423 N.W.2d 671, 677 (Minn. 1988); Johnson v. County of Dakota, 510 N.W.2d 237, 240 (Minn. App. 1994). If the duty at issue is only "ministerial," i.e., "absolute, certain, and imperative, [involving] merely the execution of a specific duty arising from fixed and designated facts," then official immunity is not applicable. Johnson, 510 N.W.2d at 240.

In the immunity context, "willful and malicious are synonymous." Id. Willfulness and maliciousness will be found "'only when an official intentionally commits an act that he or she has reason to believe is prohibited.'" Id. at 240-41 (quoting Rico v. State, 472 N.W.2d 100, 107 (Minn. 1991)).

The district court did not specifically address the immunity issue, but its order implicitly holds that summary judgment based on official immunity was inappropriate. We disagree.

The information provided to Fleskes and others in the foster care unit suggested that Kline's son was unpredictably in and out of her home. Information provided by Kline conflicted with that provided by investigators. The decision whether to use the Kline home under these circumstances was discretionary, not ministerial.

The precise disagreement between the parties here is whether there is a genuine issue of material fact as to maliciousness or willfulness. Kline argues that evidence of malice is supplied by conversations about her involvement with a group organized to protest against certain county policies or operations. A case manager stated by affidavit that, at around the time Kline became licensed (August 1993), Petri learned that Kline was a member of the protest group and expressed surprise and embarrassment. In the summer of 1994, Fleskes had a conversation with another county employee supervising another area of placements who talked about having a policy of not contracting with members belonging to the protest group. We hold that this evidence does not raise a genuine issue of material fact as to malice in the decision to put placements at the Kline home "on hold." Fleskes testified that the statement was simply something that the other employee said and that it was said "light-heartedly." It would be inordinately presumptuous to view these comments as material to the decision to put the Kline home "on hold," given the substantial evidence of more serious concerns about the presence of Kline's son at her home.

We reverse the district court's denial of appellants' motion for summary judgment, holding that appellants are immune from suit.

II. Breach of Contract Claim

Kline, by notice of review, challenges the district court's grant of summary judgment on her contract claim. We agree with the district court's ruling that there is no genuine issue of material fact.

Nowhere does the contract between the county and Kline provide that the county must refer placements to Kline or otherwise promote her business; it simply provides that the county will determine eligibility and set rates for residents seeking placement. Kline argues that the county was bound by an implied covenant of good faith and fair dealing. See American Warehouse & Distrib., Inc. v. Michael Ede Mgmt., Inc., 414 N.W.2d 554, 557 (Minn. App. 1987) (nonsales contracts contain implied covenant of good faith and fair dealing). No such covenant exists here, however, for the alleged bad faith actions involve terms that are not part of the contract. See Beer Wholesalers, Inc. v. Miller Brewing Co., 426 N.W.2d 438, 441 (Minn. App. 1988) (implied covenant of good faith in nonsales contract does not extend to performance of actions outside scope of written agreement), review denied (Minn. Aug. 24, 1988). We affirm the district court's grant of summary judgment dismissing Kline's contract claim.

III. Defamation Claim

Kline claims, by notice of review, that the district court erred in ruling that no genuine issue of material fact exists on her defamation claim. We disagree.

To establish a claim of defamation, the plaintiff must show

that the alleged statements were made, that they were communicated to someone [else], that they were false, and that, as a result, [the plaintiff's] reputation was harmed.

Ferrell v. Cross, 557 N.W.2d 560, 565 (Minn. 1997). As the district court ruled, the phrase "on hold" is neutral. The same is true for the phrase "do not use." These phrases are not and could not be false. Moreover, Kline does not set forth any evidence that her reputation was harmed by the statements.

Because our decision results in dismissal of all of Kline's claims, we need not address the issue she raises concerning the district court's denial of her motion to add a claim for punitive damages.

Affirmed in part and reversed in part.

[ ]1 It is unclear whether the words "on hold" were put on earlier lists. Fleskes testified that the words "should have been" included on the December and January lists as well.