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Takings

Federal Court Rules Against Plaintiffs in Second Hurricane Harvey Takings Case

The ruling may well be both correct and consistent with the same court's earlier ruling in favor of a different set of plaintiffs arising from the same events. But the opinion does still have a few notable flaws.

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

 

Earlier today, Senior Judge Loren Smith of the US Court of Federal Claims ruled against a group of property owners who argued that the US Army Corps of Engineers violated the Takings Clause of the Constitution when they deliberately flooded their homes and businesses during Hurricane Harvey in 2017, in order to prevent even worse flooding elsewhere. This case concerns claims by property owners whose lands were downstream of the dams the Corps opened during the Hurricane.

In December, a different judge of the same court ruled in favor of similar takings claims by the upstream owners (I analyzed that ruling here). The two  decisions may seem contradictory. But I actually think Judge Smith's opinion outlines a strong justification for distinguishing them. While it may annoy some of my friends in the property rights community, I believe there is a strong likelihood this ruling is correct, even though I also agree with the earlier pro-plaintiff ruling in the upstream case, and more generally believe that the Takings Clause requires the government to compensate property owners when it inflicts damage on their property by deliberately flooding it. At the same time, I do have reservations about some parts of Judge Smith's analysis.

The key reason why Judge Smith concluded that the downstream and upstream cases are different is that there is a strong case that the government's actions were not really the cause of the flooding damage in the former situation. Had the government done nothing, the property owners would likely have suffered the same sort of harm. And the Takings Clause doesn't protect owners against property damage that was not caused by the government or its agents:

In [the] opinion [in the upstream case], Senior Judge Lettow determined that the taking of upstream property occurred as a result of the general operation of the Addicks and Barker Dams and Reservoirs, as a direct result of the Corps' decision to close the flood gates in order to protect properties downstream at the expense of the upstream properties located within the maximum pool size for the Reservoirs…. In contrast, the Downstream plaintiffs do not allege that the general operation of the Reservoirs caused the flooding of their property…. Rather, plaintiffs downstream advance a takings theory predicated on the Corps' decision to open the flood gates and begin Induced Surcharge releases…. As more fully explained below, the downstream plaintiffs' theory of causation ignores the simple fact that the gates were initially closed for the sole purpose of protecting their properties from floodwaters, that such mitigation failed because the impounded storm waters exceeded the Reservoirs' controllable capacity, and that the Harvey was the sole and proximate cause of the floodwaters….

Perhaps the government should have protected the owners better. Having failed to do so, perhaps it should still compensate them for the damage they suffered (though this is highly debatable). But such compensation isn't required by the Takings Clause. Later in the opinion, Judge Smith quite properly distinguishes between the seizure or destruction of property rights by the government (which is a taking requiring compensation), and withdrawal of government benefits—including protection against naturally occurring flood damage:

There is a fundamental difference between property rights and the benefits a government provides to its citizens. To ignore this would be to discard the last several hundred years of Anglo-American legal history. That difference is based upon the relationship between the source of the property and the new owner of the property right. The property right is created by the conveyor and arises out of the conveyor's relationship with the recipient. That relationship most commonly takes the form of a contractual obligation. Furthermore, a property interests can occasionally be created as a gift—for example, an inheritance, an award, or a personal gift. These then become the recipient's property. However, when a government creates programs that benefit its citizens, those programs rarely provide members of the public with property interests.

All of the above seems sound. Another good aspect of the opinion is that Judge Smith did not embrace any of the more extreme theories advanced by the federal government, such as the "one flood free" theory, under which deliberate government flooding of land can never be a taking so long as the flood is temporary, and "only" happens once. In  that respect, it is also consistent with the Judge  Lettow's ruling in the upstream case.

I do have one nagging concern about the outcome here: it is possible that the government's decision to keep the dam closed for several days after the hurricane started, and only then release the accumulated water might have caused even more damage to the plaintiffs' land than would have occurred had the water been allowed to spread unimpeded from the start and therefore hit the affected properties at a slower pace. I lack the technical expertise to assess this possibility. But it seems to me an issue that the court should have considered. If the government's decision inflicted damage beyond that which naturally occurred, then its actions did in fact inflict a taking, albeit the amount of compensation due is likely to be far smaller than the plaintiffs would want (because much of the damage would still have been unavoidable regardless of what the government did).

Judge Smith's opinion also engages in some problematic rhetorical excesses, such as this:

[P]laintiffs allege that the government could have done more to ensure perfect flood control efforts, and because the government did not do more, it failed to stop the flooding of their lands. Of course, the water from the hurricane was not the government's water, unless the storm was also created by the government's wind and air and sun and sky. These were flood waters that no entity could entirely control. The government attempted to mitigate against them, but it could not. Thus, plaintiffs' claims are essentially that they were entitled to perfect flood control, simply because government set up a flood control system to help protect residents in the Houston area.

The idea that the plaintiffs are demanding "perfect flood control" strikes me as a strawman caricature of their position. Their claim is not that a taking occurs anytime flood control is imperfect, but that the government deliberately released large quantities of water onto these owners' land, and inflicted damage that could have been avoided, and would not have occurred absent its actions. As Judge Smith explains, the plaintiffs' theory of causation here is subject to serious question. But a demand for "perfect flood control" it is not.

Judge Smith further concludes that no property right was lost here because none had been created by federal or state law:

So, do plaintiffs have the right to be perfectly protected from flooding? The simple answer is no; the right to perfect flood control it is not recognized by either Texas property law or federal law. The purpose of the Constitution's Fifth Amendment protections is to protect legally recognized property rights, but those property rights can only be created by the states or the federal legislative and executive departments.

The idea that property rights are purely the creation of state and federal governments is deeply embedded in modern jurisprudence, and I can understand why Judge Smith chose not to question it. It is, nonetheless wrong, for reasons I summarized in this article, which points out how the Takings Clause—and the Constitution generally—are based on natural rights theories of property under which many types of property (including property in land) have justifications independent of any endorsement by state law. In my book The Grasping Hand (ch. 2), I discuss how the dominant view in eighteenth and nineteenth century legal thought was that state and federal takings clauses were intended to protect natural property rights, but not necessarily those that existed only because of state law. For that reason, abolitionists and others argued that the abolition of slavery would not be a taking, since the generally accepted view of the "peculiar institution" was that it was contrary to natural law and could only legally exist where endorsed by the positive law of  the state or federal government.

If consistently applied, the theory that constitutional property rights are purely the creation of state and federal law would  undermine many of our other constitutional rights, which could similarly be declared purely creations of the government, and thus ineligible for constitutional protection unless affirmatively endorsed by state authorities. Hopefully, the Supreme Court will someday set this issue straight.

I have a few other reservations about the judge's analysis of relevant Texas law and how it should influence a federal constitutional takings analysis. But those are best saved for a later time, as this post is already quite long.

Like the earlier decision in the upstream case, this one will almost certainly be appealed. These cases have now dragged on for over two years, and are likely to continue for some time to come. But, despite my concerns about some parts of the judges' reasoning, it is heartening that so far the rulings in both cases seem largely correct.

Questions of causation will often pose difficult questions in these types of cases. But, hopefully, the end result of this legal battle will be to establish the principle that when the government deliberately floods your land, the Takings Clause requires compensation for any damage that would not have occurred absent the government's actions.

UPDATE: I have modified a passage in this post to make it clearer.

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9 responses to “Federal Court Rules Against Plaintiffs in Second Hurricane Harvey Takings Case

  1. Good review. And I largely agree with your evaluation (though I am critical of the lack of clarity in Judge Smith’s memorandum). As to your “nagging concern” about the accumulation and release, that’s not a real issue. The outlet rates were by order of magnitude less than the inflows (a point Judge Smith got right). In the absence of the dams, downstream flooding would have been much worse.

    I agree 100% about the straw man. Downstream never contended a right to “perfect flood control” or anything of the sort. And the Court’s acceptance of DOJ’s narrative about the storm’s foreseeability, while not important to the ultimate conclusion, missed the mark factually. As the upstream trial demonstrated, the Corps foresaw a storm of the magnitude of Harvey even when it built the dams. And the region has experienced other storms with similar or greater rainfall as what fell over the Addicks and Barker watershed in Harvey. The resort to periodicity for Harvey, writ large, is another straw man.

  2. Unfortunately, it did feel like the plaintiffs, in combining the upstream and downstream flooding cases, were basically asking for perfect flood control.

    There couldn’t be downstream flooding (otherwise that’s a taking), there couldn’t be upstream flooding (because THAT’S a taking), and it begins to look like a trolley problem.

    The engineers can open the dam gate. That results in flooding. They can keep the dam flood gates closed. That results in flooding. The rain is continuing to fall (outside of the government’s control). No matter what they do, someone gets flooded. There has to be a way to get out of the situation with being legally “wrong”. Unless the only way is to be “perfect”

  3. If you want to interest most Volokh Conspiracy followers in this one, professor, you’ll need to state how many dirty brown people died in that water.

  4. Respectfully, that position betrays a lack of understanding of how these dams operate and the hydrology involved in the actual event. Inflows to the reservoirs were more than 100,000 cf/s. The gates, when opened, allowed 16,000 cf/s out of the reservoirs. (For reference, the bayou can sustain ~4,000 cf/s before flooding.) There was always going to be flooding Upstream regardless of the gates, which had very little to do with the Upstream situation. And, without the dams, Downstream would have been hit much harder—all of that is the fundamental purpose for the dams.

    But, from the Downstream perspective, the facts are that, while mandated by the Water Control Manual to open the gates, there was no actual emergency that required opening the gates that much. By all accounts, the dams could have held the water at that level and allowed form a longer draw down without downstream flooding. The Downstream argument is that the government decided to open the gates and release water in excess of the bayou’s capacity to follow the Manual when it was not required.

    There may be legal challenges to the Downstream position. But no one ever argued that they had a protected property right to perfect flood control, which was the straw man that the order attacked.

  5. re: the hypothesis that incrementally less damage might have occurred had the water accumulated as a slower, more natural pace

    You concede that you lack the technical expertise to assess the possibility. I consider it likely to the point of near-certainty that the judge also personally lacks such technical expertise. As near as I can tell, neither party raised it. Without briefings by the parties on the possibility, I don’t see how the judge could have considered it.

  6. It seems like much of this in both the lawsuits and earlier comments here boils down to perfect hindsight. I doubt anybody can make a perfect determination in the middle of a hurricane as to how to minimize damage, especially because hurricanes aren’t known for being predicatble.

    In terms of the upstream property owners, these are apparently “upstream properties located within the maximum pool size for the Reservoirs.” I’d think anybody who owns land within the “maximum pool size” of a reservoir should expect to have their land become part of the reservoir during extreme conditions.

    1. Are expectations relevant to the takings analysis? I honestly don’t know, but don’t think they should be, at least as to whether a taking occurred. Just because you might expect that the government will take your property doesn’t mean it isn’t a taking. It was still the government’s actions that caused the loss. The idea is that “all” should bear the burden, not the “few.” That doesn’t change just because the few expect it.

      Where I do think it becomes relevant, at least indirectly, is in damage valuation. I expect that having those expectations decreases the property value and therefore the damages that actually occurred. Now that would be baked in to normal appraisal so wouldn’t be talked about directly, but it is working behind the scenes.

      1. Does your view of the upstream situation change at all if the upstream property in question was undeveloped agricultural land at the time the dam was built—which is to say land which would have suffered no lasting damage at all from a flood?

      2. Just because you might expect that the government will take your property doesn’t mean it isn’t a taking.

        This is tricky.

        Suppose I buy land which is at risk of being flooded by government action. (I’m not talking about the specific case here.) Wouldn’t I pay less than I would if there were no such risk?

        It seems to me that I have already been compensated, in that I saved money on the purchase. After all, known risks are reflected in prices.

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