The Houston Flooding Takings Litigation Continues

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

CNN has an interesting article describing  ongoing litigation in which thousands of Houston property owners whose lands were deliberately inundated by the US Army Corps of Engineers in the aftermath of Hurricane Harvey in 2017 are suing for compensation under the Takings Clause of the Fifth Amendment:

Two days after Hurricane Harvey made landfall in Texas in August 2017, as historic rainfall submerged parts of Houston, the Army Corps of Engineers released water from two reservoirs into a river running through one of the country’s richest zip codes.

The water crept out of Buffalo Bayou and into West Houston’s Energy Corridor, home to numerous energy companies and residential neighborhoods. It inundated Kyle Haines’ home, drowning his 71-year-old husband, Bob. It left Maria Sotolongo’s home nearly uninhabitable….

Two years later, they’re still trying to recapture the sense of security that was swept away with their possessions….

Hundreds of West Houston property owners are suing the federal government, claiming the Corps flooded their homes to save the rest of the city. They allege the government owes them for effectively taking their property to store water from the reservoirs, in violation of a Fifth Amendment right which says the government can’t take private property for public use without just compensation….

In the litigation against the Corps, the two are part of a group of property owners whose homes were downstream of the reservoirs. The downstream cases are being tried separately from lawsuits involving properties that were upstream or behind the reservoirs because they involve different circumstances and legal arguments…

A trial for the upstream plaintiffs concluded in May, and closing arguments are scheduled for September in Washington. The next hearing in the downstream trial is scheduled for October.

Each trial is starting with a small group of plaintiffs who serve as “test cases” for the larger pool of property owners, said lawyer Rand Nolen, lead counsel for the downstream cases.

Sotolongo and Haines are not part of the test cases, but the outcome will affect them all the same, Nolen said.

Even if the property owners prevail, it will be a long time before they see a dime, given appeals, Nolen said.

“What’s at stake is the plaintiffs’ financial security for years to come,” he said. “Many borrowed money to repair their homes. Some had to sell homes for pennies on the dollar. They suffered huge financial losses.”

In addition to the huge stakes for the many thousands of people affected by the Corps’ actions, these cases are also likely to set important precedents for future situations where the government deliberately floods or otherwise destroys private property in order to manage natural disasters, or perhaps for other purposes. I described the key issues at stake in this 2017 post:

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’s decision was far from a model of clarity when it comes to the question of how to figure out whether a given case of deliberate temporary flooding should be considered a taking or not….

[In the Houston cases,] the government claims that one-time flooding can never qualify as a taking. Under this theory, only recurrent flooding can do so, as [happened] in the Arkansas Game and Fish case.

The plaintiffs understandably deride this “one flood free” rule, and urge the courts to reject it. It makes little sense to claim that a one-time flood can never be a taking regardless of how deliberate it was or how much damage it inflicts. In this instance, the damage to at least some of the homes and businesses was severe, and the deliberate flooding that caused it should be considered a taking…

It is difficult to predict which way the judiciary will ultimately rule on these cases. The Arkansas Game and Fish standards are far from clear and the courts have a history of siding with the government in many ambiguous takings cases….

This dilemma highlights a weakness in the Arkansas Game and Fish test that the Supreme Court should eventually fix by ruling that deliberate flooding is automatically a taking, at least if it inflicts significant damage on private property. I made this point in my 2013 article on [Arkansas Game and Fish]…

Since I wrote my 2017 post on the Houston flooding cases, the litigation has gradually progressed. In May of last year, the Court of Federal Claims issued a preliminary ruling in the “upstream” cases rejecting the federal government’s motion to dismiss them before trial. Among other things, Judge Charles Lettow’s opinion rejects the Justice Department’s “one free flood” argument as inconsistent with Arkansas Game and Fish (see pp. 13-14). While this was just a preliminary opinion enabling a trial to go forward, it strongly suggests that Judge Lettow will ultimately resolve this issue in favor of the property owners. He also rejected a number of other arguments offered by the federal government. We have not yet had a ruling on the “one flood free” argument in the case involving downstream Houston cases.

Meanwhile, trials are proceeding in both cases, focused in part on issues of causation (the federal government claims that many of the affected property owners’ land would have been damaged as much or more even if the Corps of Engineers had not flooded it.

In December, a Texas state appellate court issued a ruling siding with property owners in a similar case involving deliberate flooding of land by the state government’s San Jacinto River Authority (also during Hurricane Harvey). The Texas decision does not bind the federal courts, of course. But it addresses very similar issues, and might be a persuasive precedent for federal judges.

In my view, the causation issues in the Houston cases are often genuinely difficult, and it is understandable that the government would contest this question in many of the cases. By contrast, the federal government’s “one flood free” argument is much less defensible. If it prevails, the government would have a blank check to flood private property in many circumstances, without having to pay compensation. If the Obama administration had deliberately flooded thousands of homes and then trotted out a dangerous theory like “one flood free” in order to avoid having to pay compensation, conservatives would have been outraged.

Even when the flooding and destruction of property is for a good reason (such as preventing even worse flooding elsewhere), that’s no justification for denying compensation.  I  summarized the reasons why in my 2017 post:

[T]he fact that the flooding might have been a good policy (or at least the lesser of the available evils under tragic circumstances) does not mean there was no taking. As the Supreme Court famously put it in a 1960 case, the whole point of the Takings Clause’s just-compensation requirement is 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.” Even if the “public burden” is entirely justified, that does not mean it should be inflicted on the property owners, as opposed to “the public as a whole.” That is true when the government takes property to build a highway or military base that benefits the general public. It is equally true when it floods some people’s property to prevent potentially greater devastation elsewhere.

Whatever else happens in these cases, hopefully the courts will ultimately reject “one flood free” and make clear that deliberate flooding that inflicts grave damage on private property is a taking. At this point, I am guardedly optimistic the courts will  come down on the right side of the takings question, based on developments so far. But the trial court rulings are likely to be appealed, and the issue might even get to the Supreme Court. So it is still too early to make any definitive predictions.

As the CNN article makes clear, another painful aspect of these cases – sadly not unusual for federal court litigation – is how long they have dragged on (almost two years, with a long time probably still left to go, if we include likely appeals). During that time, the victims continue to suffer without any compensation. As the saying goes, justice delayed is justice denied. And the one certainty in these cases is that any justice the owners get will only come after a lengthy delay (if at all).

In addition, as the article notes, the person whose husband was killed in the government-induced flooding may not be able get compensation for his spouse’s death, which cannot be addressed by a takings claim (takings cases are for loss of property rights, not loss of life). I am not sure what, if any legal remedy might be available to him. This issue is not within my expertise,as a takings scholar, so perhaps there is a possible remedy I am overlooking.

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