The U.S. Court of Federal Claims dismissed U.S. Constitutional Fifth Amendment takings claims related to “Hurricane Harvey” for failure to state a claim upon which relief could be granted. The ruling comes as a result of the court’s determination that the Fifth Amendment only protects legally recognized property rights created by states or the federal government. [In re Downstream Addicks and Barker (Texas) Flood-Control Reservoir, ___F.Supp.3d___, Case No. 17-9002 (Fed. Cl. Feb. 18, 2020).
Factual and Procedural Background
This litigation was brought by residents of Harris County, Texas (plaintiffs). Plaintiffs suffered from flooding that damaged their property during Hurricane Harvey in 2017. Plaintiffs alleged that economic and emotional damages occurred as a result from imperfect flood control from two dams created by the U.S. Army Corps of Engineers (Corps or federal government) to mitigate against floods in their area.
The Corps created the Barker Dam and Addicks Dam between February of 1942 and December of 1948, respectively. The dams’ reservoirs provided flood protection along the Buffalo Bayou. Plaintiffs acquired their respective properties between 1976 and 2015. All properties fell within the Buffalo Bayou watershed and all properties were built after the erection of the dams.
On August 25, 2017, Hurricane Harvey made landfall on the coast of Texas. To mitigate against downstream flooding, the Corps closed the flood gates on both the Addicks and Barker dams. By August 28, the volume of water in the reservoirs exceeded capacity and the Corps began releasing waters downstream. Despite the controlled releases, uncontrolled water was reported to be flowing around the north end of the Addicks Dam.
In September of 2017, property owners began to file claims with the court. Plaintiffs alleged that the flooding caused by Hurricane Harvey and the dams was an unconstitutional taking of their property. The claims were consolidated and then bifurcated into an Upstream Sub-Docket and a Downstream Sub-Docket. The federal government filed a motion to dismiss under Rule 12(b)(6) of the United States Court of Federal Claims for failure to state a claim upon which relief could be granted. The federal government alleged that the government cannot take a property interest that plaintiffs do not possess.
The Court of Federal Claims’ Decision
The Takings Clause of the Fifth Amendment protects against private property being taken for the public without just compensation. Accordingly, courts implement a two-step analysis of takings claims. First, a court determines whether plaintiffs possess a valid interest in the property affected by the government action. If the court determines that the plaintiffs do have a property right, then it must decide whether the governmental action at issue constituted a violation of the property right.
The Court of Federal Claims referenced that for a Fifth Amendment takings claim to succeed, plaintiffs must first establish a compensable property interest. For a property right to be recognized, it must have a legal backing, such as a state or federal law protecting the interest.
State Recognized Property Rights
The Court of Federal Claims reviewed over 150 years of Texas flood-related decisions and determined that the State of Texas has never recognized perfect flood control in the wake of an “act of God,” such as a hurricane, as a protected property interest. In fact, the court determined that Texas had specifically excluded the right to perfect flood control when the occurrence was an act of God.
Under Texas law an act of God is the result of an event that was “so unusual that it could not have been reasonably expected or provided against.” Here, the court determined that Hurricane Harvey was an event that occurred only every 200 years, and that the Houston area could not have reasonably expected or provided against its damages. Therefore, the federal government could not be held responsible for plaintiff’s injury because Texas law specifically limits liability in takings and tort contexts when the operator of a water control structure fails to perfectly mitigate against flooding caused by an act of God.
The court then looked to the Texas state Constitution, which specifically enumerates that police power is an exception to takings liability and that property is owned subject to the pre-existing limits of the state’s police power. The court highlighted the fact that Texas courts have consistently recognized efforts by the state to mitigate against flooding as a legitimate use of police power.
The court also looked to the Texas Supreme Court’s holding that governments cannot be expected to insure against every misfortune on the theory that they could have done more. The reasoning behind that conclusion was the fact that extending takings liability on such instance would encourage governments to do nothing to prevent flooding instead of trying to address the problem.
Finally, under Texas case law when an individual purchases real property, the individual acquires that property subject to the property’s pre-existing conditions and limitations. The court noted that each of the plaintiffs in this case acquired their property after the construction of the Addicks and Barker dams. Therefore, plaintiffs acquired their property subject to the right of the Corps and federal government to engage in flood mitigation.
Federally Recognized Property Rights
Because the court did not find a property right recognized by the State of Texas, it examined whether federal law provides plaintiffs with protected property interest. Plaintiffs advanced two legal theories to allege that federal law recognized their property rights. First, plaintiffs alleged that because their property only experienced minimal flooding before Hurricane Harvey, they had a reasonable investment-backed expectation that they would always remain free from flooding. Second, plaintiffs alleged that because the water ran through the Corp’s reservoir, it was the Corps’ water and not flood water.
First, the Court of Federal Claims determined that plaintiffs did not have a reasonable expectation to be free from flooding simply because the federal government erected a dam to mitigate floods. The court determined that:
“. . .an unintended benefit could not create a vested property interest, and that ‘[i]n certain limited circumstances, the [federal government] can eliminate or withdraw certain unintended benefits resulting from federal projects without rendering compensation under the Fifth Amendment.’”
The court highlighted the notion that government projects rarely provide an individual with a property interest because government projects are intended to benefit the community as a whole.
Second, the court determined that the Flood Control Act of 1928 (FCA) defines water impounded behind dams because of a natural disaster as flood waters. Additionally, the court determined that the FCA does not confer owners a vested right in perfect flood control simply for owning property that benefits from a flood control system. The court determined that when the Federal Government undertakes efforts to mitigate against flooding, it does not become liable for a taking because the efforts failed.
The court concluded that there exists no cognizable property interest in perfect flood control against waters resulting from an act of God. The court refused to extend liability to the federal government because it failed to protect against waters outside of its control. Therefore, the court granted the federal government’s motion to dismiss for failure to state a claim upon which relief could be granted.
Conclusion and Implications
The court’s decision closely tracked state law and federal law in an attempt to harmonize its decision. In the end, the Court of Federal Claims found that the failure of a federal flood control project to control flood waters may not constitute a Fifth Amendment taking without a state-created property right to be free from the type of flooding at issue. The implication of that analysis would suggest that a different result might be possible on the same or similar fact in another state. In February 2020 we reported on the court’s decision in the “upstream” portion of the flooding event. See: 30 Envtl Liab Enforcement & Penalties Rptr 74. The court’ decision is available online at:
https://ecf.cofc.uscourts.gov/cgi-bin/show_public_doc?2017cv9002-203-0
(Marco Ornelas, Rebecca Andrews)
