In Hauselt v. County of Butte, (— Cal.Rptr.3d —, Cal.App. 3 Dist., March 23, 2009), a California Court of Appeal considered whether a county was liable for inverse condemnation based on a property owner’s claim that the County, through the implementation of its general plan and permits granted to surrounding developers, caused flood water to be directed onto his property, resulting in a taking of his property for public use. The Court of Appeal found that the county’s conduct was reasonable and it was not liable under a claim of inverse condemnation.
In 1988, William Hauselt purchased a 94 acre almond orchard just one mile north of Chico, California in Butte County (“County”) with the intention of developing the property into a residential subdivision. The northern portion and boundary of the property has a natural watercourse name Keefer Slough. Just north of Keefer Slough are two subdivision developments named Carriage Estates (“Carriage”) and Wildflower Estates (“Wildflower”). Keefer Slough is to the south of Rock Creek and two to three times a decade Rock Creek overflows and Keefer Slough receives the floodwater runoff.
Hauselt contends that in accordance with County’s Master Drainage Plan, County made Keefer Slough a major part of the County’s public drainage system through the following actions. First, improvements on the Carriage and Wildflower developments included pipes that led runoff from the subdivisions into Keefer Slough. Second, the County allowed Carriage and Wildflower to raise the northern bank of Keefer Slough to a level higher than the southern bank. Third, the County built a new bridge upstream of Keefer Slough which increased the flow downstream on Hauselt’s property. Fourth, the North Chico Specific Plan identified Keefer Slough as the area’s primary drainage channel. Fifth, County intentionally preserved increased sedimentary levels in Rock Creek caused by storms in 1997 and 1998 which increase the runoff in Keefer Slough. Sixth, Hauselt claims that the County prevented him from developing his land for residential use.
The trial court found that the County’s actions were reasonable and did not result in inverse condemnation. In addition, the trial court noted that County’s activities did not transform Keefer Slough into a public work or increase the flow of water into Keefer Slough or onto Hauselt’s land.
The Court of Appeal began with a discussion of inverse condemnation in the flood control context. Under the California Constitution, private property may not be taken or damaged for public use unless just compensation has been paid. An action for inverse condemnation seeks to enforce this constitutional provision. However, in the flood control context, an action for inverse condemnation is typically measured by a reasonableness standard. That is, the County would be liable to Hauselt if: (1) its conduct posed an unreasonable risk of harm; (2) its conduct was the substantial cause of damage to Hauselt’s property; and (3) Hauselt had taken reasonable measures to protect his property.
Hauselt first argued that the trial court never decided the central issue in the case: whether County’s Master Drainage Plan made Keefer Slough, and therefore his property, the central drainage hub for the area. Hauselt argued that the County did make Keefer Slough the central drainage hub for the area through the Master Drainage Plan, and as a result, County used his property for public use. The Court of Appeal disagreed, and instead found that the trial court did decide this issue against Hauselt’s position. Specifically, while County’s Master Drainage Plan did have provisions making Keefer Slough the central drainage hub for the area, those provisions were never put into action. Instead, the trial court determined that County implemented alternative provisions which did not make Keefer Slough the central drainage hub for the area.
Next, Hauselt argued that the reasonableness standard was the incorrect standard for the trial court to apply, and instead, strict liability should have been applied. Strict liability would mean that if Hauselt could prove that County increased the discharge of water into Keefer Slough, County would be liable to Hauselt whether or not County’s actions were reasonable. The court disagreed with Hauselt and said that in the flood control context, especially where the alleged increased flow of water is onto property that is historically subject to flooding, the reasonableness standard applies.
Hauselt then argued that three of the trial court’s findings were not supported by evidence: (1) County’s lack of control over Keefer Slough; (2) County played no role in raising Keefer Slough’s north bank; and (3) County’s projects activities did not increase the volume of water in Keefer Slough on Hauselt’s property. The court rejected this argument because Hauselt did not challenge the trial court’s findings in terms of whether or not County’s activities were unreasonable. In other words, even assuming that Hauselt was right, and the evidence supported his position on these matters, Hauselt did not present an argument for why these activities are unreasonable. Moreover, the court pointed out that in making this argument, Hauselt only cited evidence that supported his position and conveniently omitted evidence on the record that contradicted his argument.
Lastly, Hauselt challenged a finding by the lower court that one of his arguments was barred by a statute of limitations. Specifically, Hauselt argued that ditches and pipes installed to the Carriage and Wildflower subdivisions in 1976 should not be barred from consideration in his claim. The court of appeal disagreed and pointed out that he purchased the property in 1988, admitted at trial that he discovered the existence of the ditches and pipes and 1992, but did not file his claim until 1998. The statute of limitations applied by the court was for five years. Whether Hauselt’s purchase date, or the date of actual discovery is used, both are more than five years before the time Hauselt filed his complaint.
In conclusion, the Court of Appeal found that the reasonableness standard should be applied to a public actor’s conduct in flood control situations where the public actor may have caused an increase of water flow in an area historically subject to flooding. Under the facts here, County acted reasonably and was not liable for inverse condemnation.
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