Property Rights

Court Rules Federal Government Flooding of Homes During Hurricane Harvey is a Taking

The decision is significant in itself and has important implications for other cases where the government deliberately damages private property in the process of coping with natural disasters.

|The Volokh Conspiracy |

Flooding in Houston caused by Hurricane Harvey. (LM Otero/AP)

In the wake of the devastating Hurricane Harvey in 2017, the US Army Corps of Engineers deliberately flooded  thousands of homes and other properties in Houston, because they they believed it was necessary in order to prevent even worse flooding elsewhere. Numerous property owners filed lawsuits claiming that the flooding amounts to a taking requiring "just compensation" under the Takings Clause of the Fifth Amendment.

The litigation in these cases has dragged on for over two years. But, earlier today, we finally got a decision on the merits in one of them, issued by Judge Charles Lettow of the US Court of Federal Claims. His ruling is a major victory for the plaintiffs, in so far as he concludes that the flooding does indeed qualify as a taking, and the federal government must pay compensation for the enormous damage inflicted. The decision potentially has significant implications for other similar cases.

To many people, it may seem obvious that the government has "taken" your land if they deliberately flood it, and inflict massive damage in the process. I share that sentiment. But, unfortunately, the Supreme Court's jurisprudence on the subject is far from a model of clarity, which is one of the reasons why today's decision is important.

In its unanimous decision in Arkansas Game and Fish Commission v. United States (2012), the Supreme Court rejected the Obama administration's dubious argument that temporary flooding of property by the government can never qualify as a taking. But the Court also did not hold that such flooding is automatically a taking. Instead, they gave us a complex multi-factor test to help determine which cases of government-induced flooding are takings and which are not.

In this article, I counted four factors: the duration of the flooding, "the character of the land at issue, the owner's 'reasonable investment-backed expectations' regarding the land's use," and "the degree to which the invasion is intended or is the foreseeable result of authorized government action." Where I saw four factors, Judge Lettow counts six: The factors…. include: (1) 'time;' (2) 'inten[t];' (3) 'foreseeab[ility];' (4) 'character of the land;' (5) 'reasonable investment-backed expectations;' and (6) 'severity' [of the damage]." Some of the difference between his count and mine may be just a matter of terminology. But I now think I probably erred in not considering "severity" to be a separate factor, as opposed to being subsumed under the others.

However many factors the test has, the Court gave little guidance on how they are to be assessed, how much weight should be given to each, and what happens if some factors come down in favor of the government and some in favor of the property owners. Nonetheless, in my view, the factors in the Houston cases strongly support the plaintiffs. Judge Lettow agrees:

The time and duration of the government invasion is an important consideration in many takings cases…. The government, through its construction, maintenance, and operation of the Addicks and Barker Dams in the past, present, and future, has taken a permanent flowage easement on plaintiffs' properties. Defendant argues that its actions had only temporary consequences, because flood waters from Harvey were only on the properties for a matter of days….  This argument, however, fails to account for the fact that the government's actions have subjected plaintiffs' private properties to the possibility, rather probability, of government-induced flooding ever since the construction of these dams, throughout subsequent changes to the dams and reservoirs, and for at least the foreseeable future. The time and duration of the government's actions at issue here is not measured by "the length of time the water inundates the properties," as the government would have it….; rather, it is measured by a permanent right to inundate the property with impounded flood waters. Thus, this factor weighs in favor of plaintiffs….

This focus on potential recurrence and the permanent nature of the right claimed by the government strikes me as correct, and as more convincing than the government's focus on the length of time during which the property was actually covered with water. However, to my mind, the problem could be resolved more easily by simply concluding that the duration is permanent because the damage inflicted by the flooding is permanent (or at least lasts indefinitely, until such time as the owner is able to have it repaired).

Here is the ruling's assessment of severity:

The flooding at issue here went well beyond a tort and was sufficiently severe to rise to the level of a compensable taking. The government's suggestion that this flooding is not a compensable taking because it was temporary and confined to a single flood event carries no water. Even if a single event of this nature were insufficient to rise to a taking, the sheer frequency of significant storms in the region both before and since construction of the dams… suggests that this was more than an isolated event, and that it is likely to recur….  [I]n the nearly inevitable event of a future storm of significant magnitude, it can be expected that the government would similarly impound water on plaintiffs' properties to prevent what would be catastrophic flooding downstream. As a result, the likelihood of recurrent flooding is high, weighing strongly in favor of the finding of a compensable taking…

The significant harm caused to plaintiffs' properties, almost entirely preventing their normal use and enjoyment, is also relevant to the severity analysis. Water measuring as much as several feet in some cases inundated plaintiffs' homes—for as long as a week in multiple instances—destroying substantial personal property, causing structural damage, and rendering properties uninhabitable or unusable until repairs could be completed months or years later.

The  severity question strikes me as an easy call.

On both this point and time/duration, it is significant that the ruling sidesteps the government's egregious "one flood free" argument (that a single instance of flooding can never be a taking), by holding that this should not actually be considered a single instance. In my view, the one flood free theory should simply be rejected outright. Judge Lettow's approach leaves the issue open. But it does reduce the possible damage such a rule can do, if adopted, by narrowing the range of circumstances that can be considered a single, isolated flood. If, as in the Houston cases, the government has a disaster-management plan that is likely to require deliberate flooding on multiple past or future occasions, it cannot be considered a one-time occurrence.

To my mind, these questions of whether the government is immune from liability when it floods private property "only" once, and (if so) what qualifies as a single, isolated flood, are the most significant raised by the case. Today's ruling does not fully resolve them. But it does move the doctrine in a more pro-property rights direction.

Here is the analysis of intent and foreseeability:

Arkansas Game & Fish next requires the court to assess "the degree to which the invasion is intended or is the foreseeable result of authorized government action…"

Despite being separate inquiries, the two factors are interrelated—one cannot find intent without foreseeability; but what is an objectively foreseeable result may not have been the intended result….

Here, the evidence demonstrates the Corps was aware or should have been aware since the initial construction of the dams and at every point onward, that the flood pools in the Addicks and Barker Reservoirs would at some point (and thereafter) exceed the government-owned land, inundating private properties….

As early as the 1940s, the Corps understood that storms of exceptionally large size were possible in the Houston metropolitan area….

To an objectively reasonable person, it was not a question of whether the pools would reach the level they did—it was merely a question of when and how often. Just as in Cotton Land Co. v. United States, "The events which occurred, although they took some time, were only the natural consequences of the [government's actions]. If engineers had studied the question in advance[,] they would . . . have predicted what occurred…."

Later events only magnified the risk of flooding beyond government-owned land, rendering it virtually inevitable….

Not only is it evident that the Corps believed flooding beyond the extent of government-owned land was probable, it is unreasonable to contend otherwise….

It is true that Tropical Storm Harvey was a record-setting storm. But the evidence markedly shows that pools of this size and the attendant flooding of private property were, at a minimum, objectively foreseeable. Thus, Harvey's magnitude does not exculpate the government of liability for its actions….

Intent does not concern whether the government meant to abridge a private property right but whether it intended to occupy the pertinent property without lawful authority or excuse…. Thus, the intent element is present if the government intended its physical occupation even if it did not intend to effect a taking….

Intent is present here because, like foreseeability, intent is not measured at one singular point in time. Again, this is because the government action at issue is not simply the construction of the dams, but the totality of their construction, modification, maintenance, and operation over the project lifespan. The Corps subjectively knew by the 1940s, and particularly by the 1960s, that storms larger than the design storm were likely to occur over Addicks and Barker…. From that time forward, it had subjective knowledge that pools exceeding government-owned land were probable at some point. Indeed, by 1973 the Corps expected the possibility of flooding off of government-owned land to become a public concern… Thus, intent can be inferred here because the government knew flood waters would likely occupy plaintiffs' private properties at some point.

I am not convinced that intent and foreseeability really are separate factors, as opposed  to merely a single factor that counts in favor of the plaintiff if the government either 1) intended the damage resulting from its flooding to occur, or 2) could reasonably foresee that it would happen, whether or not they subjectively knew it would. But, either way, this factor (or two factors) support the property owners here, as the damage was both objectively foreseeable and subjectively expected by the relevant federal agency. This part of the ruling is significant because it rejected the government's claims that foreseeability only applies to such damage as could be foreseen when the dams in question were first built back in 1940, and that the Corps therefore cannot be responsible for any damage to structures built since then, if they were larger and more valuable than those that existed at the time of construction. This theory would have greatly reduced takings liability for property destruction in any number of areas where development has occurred over the years.

The court also ruled that the plaintiffs had "reasonable, investment-backed expectations," in part because the government did not do enough to make them aware of the possibility that their land might be deliberately flooded in the event of a hurricane. I would have preferred a stronger ruling: that even if the owners were so aware that this was the Corps' policy, they still could reasonably invest in the land, and reasonably expect that the government would compensate them for deliberately inflicted damage.

Finally, Judge Lettow rejects claims that the government is immune from takings liability because it was using its "police powers" and because the flooding was driven by a "necessity" created by a natural disaster. On both issues, he emphasizes that the flooding was not merely a result of a natural disaster, but also of the government's own long-planned approach for dealing with it. Police power emergencies and "necessities" justifying exemption from takings liability only exist where the harm inflicted was "unavoidable." But here,  "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."

In my view, the better approach here would be to simply do away with the very inconsistently applied idea that exercises of the police power or necessity can exempt the government from takings liability. Even if there is a good reason for the destruction of private property, and even if that reason is a genuinely unforeseen emergency, that is not a good justification for denying innocent property owners compensation for their losses. But a trial court judge does not have the authority to fully cut this Gordian knot.

Today's ruling is far from the end of the Hurricane Harvey takings litigation. It will surely be appealed, and perhaps even get all the way to the Supreme Court. In addition, this case ruling only deals with claims by property owners whose land was upstream of the dams that the government opened. There is a separate case addressing claims by downstream owners, which remains to be decided. Both cases involve factual issues related to causation (whether the government's actions actually caused the damage inflicted on the property at issue), as well as legal questions about what qualifies as a taking. Today's ruling resolves the causation questions for many of the upstream properties, but that too might be challenged on appeal.

As Winston Churchill might put it, this more the end of the beginning of the legal struggle over Hurricane Harvey flooding, than the beginning of the end. It is nonetheless a significant win for property rights, and a rebuke to the federal government's policy of trying to wipe its hands of all liability for the enormous damage it caused.

Prominent takings expert Robert Thomas has some thoughts on today's ruling here. I previously wrote about the Hurricane Harvey cases here and here. Judge Lettow's ruling reaches the same  general conclusion as a recent Texas state court decision in a similar case, which I analyzed here.

UPDATE: I should perhaps note that today's decision only addresses the claims of thirteen property owners who "selected to serve as bellwethers for the hundreds of property owners who have filed suit raising similar claims against the government." But, presumably, these thirteen were selected as "bellwethers" precisely because the resolution of their cases is likely to dictate the outcome of all or most of the others.

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  1. Setting aside what the law is – and I find the judge convincing – why isn’t the proper rule absolute liability, and apply that to all governmental actions, not just takings.

    I think of this in terms of employment law. The Public has hired the Government to do certain things, and under respondeat superior we are collectively liable for any damages caused by our agent.

    Our employee floods a field? We’re liable.
    Our employee destroys a house? We’re liable.
    Our employee shoots someone when the agent wasn’t entitled to do so as self defense? We’re liable.

    The entire point of the takings clause was so that one person wouldn’t bear the entire cost of a public good, so strict liability is the obvious application of that.

    The only potential exception would be when our agent acts outside the scope of their contract (the constitution), in which case they are personally liable only (and I can’t think of any examples of where that would actually apply). We could even try to recover from our agent after the fact, but we are still liable.

    Why isn’t that the default rule?

    1. For levees, people take the benefit of that so they aren’t flooded in lesser storms. Should the government risk catastrophic and uncontrolled failure in a great storm just so they aren’t liable for a taking? Nobody should be disillusioned they are completely protected to begin with.

      Now with Katrina IIRC, they flooded some poor districts to protect the rich districts, which is to say the ones with the large historic homes. In that kind of calculus, yes, that would seem to be a taking.

      1. That’s my point, the taxpayers should pay the member of society who took the hit which saved everyone else.

        Think of this as a negotiated settlement. We can do a) nothing and both of our homes are destroyed, b) destroy only your, or c) destroy only mine. In a rationale agreement you and I would both willingly agree to destroy whichever home will have a lower replacement cost and well each bear half of that – me because it was my home that was destroyed, and you because my sacrifice allowed you to keep your property.

        Now scale that up and it’s absolute liability for the People, arranged through our agent the government. It’s wrong to say “the government pays” because the government isn’t a corporeal entity, it’s merely the idea of all of us acting in concert by hiring an agent to handle some affairs for us that we agree are worth doing but that are too much of a distraction to pay attention to ourselves.

        You may counter, well that money will come from the Treasury! To which I’ll merely reply that the Treasury funds come from the taxpayer, and if the cost of paying for the storm means increasing taxes then that’s what should happen – after all, the alternative was to lose everything, so everyone should be happy to merely pay a fraction of the lowest possible loss rather then the total cost of a much larger loss.

        You may retort with either “but politics!” Which I’ll agree is a problem. Or that the funds in the Treasury are largely Chinese dollars, which I’ll also agree is a problem, but not a germane one to this – that we sacrificed a persons property to protect ourselves and don’t want to pay for it.

        To use a rather crude analogy, it would be like the Aztecs sacrificing a virgin to the sun god, letting her blood run down the temple, and then complaining that they have to pay her family their fee. If the whole people are benefiting from the sacrifice, then the costs should be borne by the whole people, rather than the poor girl having her heart torn out.

        And if the people don’t benefit, then we need to fire our agents for incompetence rather than keep paying them and refuse to pay for the sacrifice.

      2. It’s also worth noting that in this particular case–Houston–that the government permitted construction on top of the local prairie land which used to absorb most of the storm water. They knew in advance that the construction would increase flood risk and the areas flooded were far better protected prior.

        What the government should do is take flooding into consideration during permitting rather than wait for the eventual disaster and claim they were in a no-win situation.

  2. [I]n the nearly inevitable event of a future storm of significant magnitude, it can be expected that the government would similarly impound water on plaintiffs’ properties to prevent what would be catastrophic flooding downstream.

    Is there not an active process in place for improving flood control – via a third dam and/or deepening existing reservoirs and/or levee improvements? I’m not from the area, but I seem to recall just hearing about this a few months ago. If so, the “can be expected” claim, seemingly applying into perpetuity, seems a bit extreme.

    1. There’s no mitigation that will completely prevent some future event necessitating a release of flood waters, even if it becomes rare on a geological scale. So long as these properties are the best choice for first line flooding they’ve still been partially seized.

      There’s a reasonable argument that whoever is second in line hasn’t had a seizure yet, but once they’ve been flooded too because a sufficiently large storm hit they should be compensated too.

      The better question though is: what’s it worth? Is the land valueless? No. It still has some value. Was there tangible property destroyed too? Probably, so at least that should be paid directly. But the long term devaluation of the property (because no one would ever develop it into something expensive) is harder to get to, though I’m sure some enterprising folks will come up with ways.

    2. HA HA HA HA HA HAAAAA!!!!

  3. It seems that the only answer is for all governments to get out of the flood control business and, in fact, all mitigation of adverse effects of natural events.

    The risk of failure on taxpayers is just too high – individuals and businesses, if they care, should buy insurance to compensate them for property loss from such events if they care about such loss.

    If the government had done nothing here, the property owners whose properties were inundated because the water was not released surely would surely not have had a “takings” claim.

    Also, haven’t the courts ruled in the past that increases to restrictions on property (zoning etc) are not a taking as long as there remains some possible use of the property? In this case, could the affected land be used for something such as elevated housing, farming, 4H club use, composting, etc.? If so, why would this, but not a zoning change, constitute a taking?

    1. “It seems that the only answer is for all governments to get out of the flood control business and, in fact, all mitigation of adverse effects of natural events…”

      Similarly, the government should get out of the business of building roads and schools. If the government takes land to build roads and schools, the owners have a takings claim. But if the government does nothing, no takings claim.

    2. Because the contents of the land, including the houses on them, were destroyed?

      You build a house under the current rules, then later the county passes new zoning rules that would have prohibited building your house, but since it’s there already you’re fine. That’s the usual zoning model. Instead suppose the new zoning rules not only require that your house be demolished, but the day they pass them and without any warning they send a giant bull dozer to smash your house and everything in it.

      That’s what the government did here (obviously specific circumstances varied), but instead of a bull dozer they sent a wall of water.

      1. Where did the wall of water come from? Was it pumped out of the ground?

        1. It was diverted out of a dam, obviously.

          Look, this is distinct from the question of whether it was the right thing to do. The question is whether the government “used” the property by taking affirmative action to destroy it in order to spare other property.

          The government is supposed to act for the general welfare, and then the general population bears the cost, rather than somebody getting the short straw.

          And a key point in the case was that the government had planned all along to do this under these circumstances. They’d designed their flood control system with this private property as a functional part of it!

          1. Water fell from the sky. It’s the government’s fault. Got it.

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  5. Somin offers disguised anti-zoning advocacy. The facts in the case are ideal cover for intellectual sleight of hand, and Somin is right there to provide it.

    The problem is that almost all the uncompensated “taken,” land was undeveloped when the dam was built. For any purpose it was currently serving, such land would not have suffered at all by the flooding.

    Thus, for future arguments, this case can be made to stand in for the general case of undeveloped land which might later change to more-developed, and thus yield a financial windfall. It is the general potential for that speculative windfall—and not the freakish circumstances of this particular case—which draws the attention of advocates like Somin.

    About those freakish circumstances. The federal government long ago built a flood control reservoir on a mostly-undeveloped drainage. Part of the land behind the dam was taken and compensated. The balance, higher up, was not.

    With regard to that higher land, years later, the federal government did nothing to disguise from reckless developers and subsequent purchasers that they were building and buying on the bottom of a usually-dry, but sure-to-be flooded, reservoir. That was crazy negligence by the developers and buyers, not by the government. Why is that now a federal responsibility?

    Taken together, those facts prepare the way for Somin (or others) to argue that any time government does anything (including zoning) which adversely affects speculative future value, it owes the property owner a windfall—with the magnitude of the windfall left to be determined by happenstance, as in this case, or by imaginative scenarios, as in a typical zoning case.

    Instead of being a federal responsibility, the responsibility for the losses in this case rightly falls first on state and local officials, who allowed the subdivisions in the reservoir. Without their negligence (or maybe connivance, if the record shows it), little or no harm would have been done. Temporarily flooded pasture land is among the most routine and least destructive of agricultural occurrences. It is an agricultural commonplace that occasional flooding can be helpful. Nor does it typically occur to farmers or ranchers that what happens when they put flood plains to agricultural use is somehow the government’s responsibility. And it would be freakish indeed to see a farmer set out to develop expensive permanent structures in unprotected flood plains.

    Second responsibility goes to the developers. They surely knew they risked defrauding ignorant buyers when they created in-reservoir subdivisions.

    Third and final responsibility goes to the buyers themselves. There is no excuse. They bought lots or developed property about which there could be no doubt—flooding was certain, because the property elevation was below the spillway elevation of the dam. Even the exact height of the flooding to which each property would be exposed was perfectly knowable, to within a few inches.

    Public policy cannot afford federal subsidy for every bit of reckless hazard to which the least attentive expose themselves. The law should not say otherwise.

    1. Completely agree with you. This area was clearly part of a reservoir in times of flooding. Whoever okay-ed the building permits is at fault. That would undoubtedly being the city of Houston.

  6. Eliminate any Federal flood insurance in a known flood zone. Then the idiots won’t build there.

    1. But when there isn’t any housing, the homeless will occupy your front lawn.

    2. It would be interesting to know if these folks even had to have flood insurance.

  7. The key question, of course, is whether or not I can sue the government for not stopping the rain from falling on my property in the first place.

    (The precedent, allowing dynamiting of buildings to make a firebreak during the Great San Francisco Fire, suggests that necessity would have been a valid defense to this claim.)

    If the Columbia river floods in Astoria, and property owners there sue Washington for not keeping the water in Washington? Or is the proper defendant the federal government, which operates several dams on the Columbia?

  8. If this is a taking, and it is, the court got it right, why isn’t the government’s destruction of a private home during a raid in pursuit of a drug suspect in Colorado also a taking? That homeowner deserves compensation.

    1. If you are talking about the case that Reason reported on earlier, it in fact was a taking. The local government admitted as much and the homeowner was compensated. The fundamental issue in the Colorado case was that the homeowner was underinsuring and undervaluing to avoid payment so when he was paid compensation, it wasn’t what he demanded that he receive. The issue in that case was whether you should be able to claim $X on taxes and insurance and then claim >$X when it comes time for the government to settle. An interesting question, but a different one than this

      1. If you are in fact referring to the same case as old jarhead, the city offered to compensate the owner only for the value of his deductable, not for the insured value of the home or for the amount of his property tax assessment. Given that, I don’t consider the fact that he was under insured relevant.

        Assuming he had been properly insured, why should the insurance company take the hit for the deliberate destruction of the home by the police?

  9. if this flooding is a taking, what about a home destroyed by cops trying to round up a fleeing criminal?

    https://www.denverpost.com/2019/10/30/swat-team-destroyed-greenwood-village-familys-home-police-dont-have-to-pay-for-damages/

  10. I’d like to see the takings rulings extended to the numerous, often devastating loss of land use due to environmental laws. People purchase and then uses land with reasonable expectations, and then a new law, or even regulation, suddenly makes their land useless, or reduces its usefulness and economic value dramatically.

  11. I loved this pun: “The government’s suggestion that this flooding is not a compensable taking because it was temporary and confined to a single flood event carries no water.”

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