On December 17, 2019, the Honorable Judge Charles F. Lettow of the United States Court of Federal Claims, issued a 46-page opinion finding the federal government liable for taking a flowage easement on private properties within the Addicks and Barker Reservoirs and upstream of the Addicks and Barker Dams—two federal flood control projects along the gulf coast in Texas. In re Upstream Addicks & Barker (Texas) Flood-Control Reservoirs, No. 17-9001L, slip op. (Fed. Cl. Dec. 17, 2019). The decision is the first step for upstream property owners hoping to recover damages for severe flooding caused by Tropical Storm Harvey over two years ago.

Background

In the 1940s, the Army Corps of Engineers’ (“Corps”) constructed the Addicks and Barker Dams and Reservoirs to help with flood control in the Buffalo Bayou watershed and City of Houston. In connection with the project, the government was required to acquire land upstream of the dams based on the Corps’ calculations. The dams, however, were designed to contain more water than the acquired land could hold—a decision, rather than an oversight, made by the Corps. In the years following their construction the Dams were maintained, modified, and evaluated by the Corps.

In August 2017, Tropical Storm Harvey dropped significant amounts of rainfall over a four-day period in the Houston area, causing widespread flooding. During the storm the Addicks and Barker Dams collected stormwater in their reservoirs, which caused properties within the reservoirs to flood. After the storm hundreds of “upstream” property owners filed suit against the federal government. Thirteen property owners who suffered significant property damage from Harvey floodwaters were selected to serve as bellwether plaintiffs for test trials, to be followed by broader multi-district litigation of hundreds of similar claims. Many of these individuals were unable to live in their homes for months and even years because of the damage, and some were still displaced at the time of trial. The case was bifurcated so that the only issue before the court was liability, with a determination as to damages to follow at a later stage of the litigation. After a ten-day trial regarding the government’s liability for the thirteen bellwether plaintiffs, the court denied the government’s motion to dismiss (which was delayed until trial) and found that the government was liable for a taking of a flowage easement on the properties.

Opinion

The question before the Federal Claims Court was “whether the government’s actions constituted a physical, permanent, non-categorical taking for a flowage easement. The alleged taking is physical, in the sense that actual flood waters physically entered the property; permanent, in the sense that the government retains the rights to this flowage easement on a permanent basis with a continual right of re-entry; and non-categorical, in the sense that the property owners are not deprived of all economically viable use of their property as a result of the flowage easement.” Id. at 26. Pursuant to the Takings Clause of the Fifth Amendment, the government cannot take private property for public use without just compensation. To establish a viable takings claim, the plaintiff must establish that he or she holds a valid property interest and that the government action at issue amounted to a compensable taking of that property interest.

First, the court addressed whether each plaintiff established a cognizable property interest. The government did not dispute that the plaintiffs are owners of private properties not subject to flowage easements. It did contest, however, that the plaintiffs hold compensable property interests under state and federal law for three reasons. First, the government took the position that it has the right to mitigate against floodwaters under Texas law. The court, however, found that while Texas law exempts government liability for diversions of water caused by construction and maintenance of flood control measures, the “conscious diversion of water by the government onto private properties in a reservoir by a flood-control dam is not within this exception.” Id. at 28. Next, the government asserted—and the court rejected—that plaintiffs’ acquisition of their land after the completion of the dams barred relief. Lastly, the government asserted that the Flood Control Act supports its position that landowners within a federal flood control project are not entitled to compensation for damages caused by floodwaters not completely controlled by the project. The court found this argument unpersuasive because the Act does not supersede or bar its jurisdiction over takings claims for flooding. Accordingly, the court held that the plaintiffs met their burden of establishing a valid property interest for the purposes of their takings claim.

Next, the court walked through the takings factors—time, intent, foreseeability, character of the land, reasonable investment-backed expectations, and severity—set forth in the Supreme Court’s opinion in Arkansas Game & Fish Comm’n v. United States, 568 U.S. 23 (2012). Ultimately the court concluded that each of the factors supported a finding of a taking of a flowage easement on all thirteen of the bellwether plaintiffs’ properties. In evaluating the various taking factors, the court continuously emphasized the government’s knowledge over the project’s lifetime that storms could occur that would cause the flood pools in the Addicks and Barker Reservoirs to exceed the government-owned land and occupy the private properties.

Because the court found that the government’s actions constituted a taking, it then turned to the government’s two defenses. First, the government argued that its actions amounted to an exercise of police powers and could not, therefore, amount to a viable takings claim. Specifically, the government took the position that its actions were intended to mitigate unavoidable harm to the public, as its only alternative option was to open the gates and risk more severe downstream flooding. The court rejected this defense, emphasizing that the flooding at issue was not unavoidable because the “constraints only existed because the Corps’ design of the dams contemplated flooding beyond government-owned land onto private properties.” Slip op. at 45. The court explained that “the government had made a calculated decision to allow for flooding these lands years before Harvey, when it designed, modified, and maintained the dams in such a way that would flood private properties during severe storms. Defendant cannot now claim that this harm was unavoidable when it planned for years to impound floodwaters onto plaintiffs’ properties.” Id. The court then turned to and similarly rejected the government’s necessity defense. The court explained that the severity of Tropical Storm Harvey was not by itself enough to infer an actual emergency, one of the elements for establishing the necessity doctrine, both because the government was responsible for creating the emergency and because the alleged invasion was not unexpected. “Thus, the necessity defense cannot apply here, because it cannot be said that ‘necessity’ existed in this case, when the flooding that occurred was the direct result of calculated planning.” Id. at 46. Because the court rejected the government’s defenses, it found that the federal government was liable for the taking of the plaintiffs’ properties.

Moving Forward

The court’s ruling is a significant first step for property owners impacted by Harvey to recover from the government for a loss they suffered over two-years ago. Exactly how much they will recover is yet to be determined. The court directed the parties to each propose three properties for consideration for an assessment of damages by January 21, 2020. The court will then select five test properties from the six proposed by the parties. Nevertheless, the court’s decision will have significant impacts beyond those impacted by the Harvey floodwaters. As storms continue to intensify as a result of climate change, there is a chance that we see similar lawsuits where government infrastructure that is ill-equipped to handle these intensifying storms results in a taking of private land for which the government must provide compensation.