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U.S. Supreme Court Finds Corps Could Be Liable For Government-Induced Flooding

In November, we noted a pending US Supreme Court case, Arkansas Game and Fish Comm. v. United States, which involved continual but temporary flooding of the Arkansas Dave Donaldson Black River Wildlife Management Area, which allegedly reduced the timber harvest by 16 million board feet and disrupted the recreational use of that land. The trial court had found a taking but the Federal Circuit reversed, finding the temporary flooding was not a permanent or inevitably recurring situation and thus not a taking.

Since 1948, the US Corps of Engineers, owned and operated the Clearwater Dam about 115 miles upstream from the Management Area. The Corps uses a Water Control Manual to determine water release rates on a seasonal basis with planned deviations for agricultural, recreational and other purposes. In 1993, the Corps released the water more slowly in order to enable farmers to have a longer harvest season, but then released more water later, during the tree-growing season from April through October, resulting in more flooding over those months. From 1994 to 2000 similar deviations were authorized over Plaintiff’s objections. The Corps also considered, but abandoned, a permanent revision to the manual.

Arkansas filed suit in 2005, claiming a temporary taking. The U.S. Court of Claims found for plaintiff, determining that the greater number of peak flood days had an adverse effect on the root system of certain tree species which justified an award of $5.7 million in damages. The Federal Circuit distinguished permanent flooding (which it found generally compensable) from temporary flooding or flowage easements (which was not compensable), relying on two previous Supreme Court cases from 1917 and 1924.

The Supreme Court on review reiterated its stock takings formula that the Takings Clause is “designed to bar Government from forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole.” While there was no “set formula” for determining a taking, permanent physical occupation of property has generally been recognized as a compensable taking. In addition, over time courts have recognized temporary physical occupation might also amount to a taking. In a previous case, the Supreme Court rejected a takings claim based on a one-time flood surge through a canal built by the United States, finding that liability required that the overflow be a direct result of the structure that constitutes a permanent invasion of land. The Supreme Court said that the requirement of permanent occupation to amount to a taking had been eliminated by subsequent Supreme Court case law, in which the court distinguished permanent physical occupation from temporary invasions, including flooding, for which said a “more complex balancing process” was required.

The Corps used a “slippery slope” argument to defend a full exemption from the takings clause, arguing that to apply that clause would make the public liable for any flooding for any brief period of time. The court responded:

“* * * To reject a categorical bar to temporary flooding takings claims, however, is scarcely to credit all, or even many such claims. It is of course incumbent on the courts to weigh carefully the relevant factors and circumstances in each case, as instructed by decisions.* * *”

Thus the court said the takings are better determined and damages calculated by review of the circumstances of each case rather than imposing a blanket rule or exemption. The unanimous court (with the exception of Justice Kagan who did not participate) ruled only that there was no automatic exemption from takings clause liability for government-induced temporary flooding.

This is a rare consensus decision on takings from the United States Supreme Court. Given the recent case law on takings since 1978, the outcome is not unexpected. However, there is no guarantee that plaintiff will be successful given the factual circumstances of this case – Arkansas lives to fight another day.

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We regularly update clients about changes in real estate law and on industry trends. This includes briefing clients on legislative proposals in the federal tax, housing and other legal areas affecting their businesses. Staying current enables you to anticipate and prevent legal problems as well as capitalize on new developments.
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