Gravel2Gavel Construction & Real Estate Law Blog
On May 24, the U.S. Court of Federal Claims decided one of what may be many cases involving the terrible flooding wrought by Hurricane Harvey in the Houston, TX region. The Court of Federal Claims has divided thousands of pending claims into “upstream” and “downstream” categories, depending on whether the flooded properties were located upstream or downstream of two U.S. Army Corps of Engineers (Corps) flood control reservoirs that were constructed in the 1940s and 1950s. The case is In re Upstream Addicks and Barker (Texas) Flood-Control Reservoirs; however, the Court of Federal Claims’ order in this case applies to “all upstream cases.”
The Court of Federal Claims ruled
“The intensely factual nature of takings cases in flooding situations necessarily intertwines questions of jurisdiction and the merits. Thus the court has decided to exercise its discretion under [Rules of the U.S. Court of Federal Claims] 12(i) to defer ruling on the government’s motion to dismiss until trial.
The storage capacity of these reservoirs was overwhelmed by the enormous rainfall when Tropical Storm Harvey drenched the Houston area for five days, and the Corps released quantities of storm water that resulted in widespread flooding.
The Court of Federal Claims concluded that for some time the Corps was aware of the fact that its reservoir management plans could result in such flooding in the event of heavy rainfall because of inadequate storage capacity. The storm flooded nearly 7000 acres of private property, and thousands of lawsuits have been filed seeking compensation based on constitutional taking claims.
On May 16, 2018, the U.S. filed a motion to dismiss these claims for the following reasons:
(a) the relevant statute of limitations has run;
(b) the plaintiffs are erroneously making a claim based on government inaction rather than government action;
(c) the plaintiffs lack the necessary underlying property interest under either state or federal law to bring a viable takings claim;
(d) the plaintiffs have no reasonable investment-backed expectations because they acquired their property after the reservoirs were constructed; and
(e ) the plaintiffs have only plausibly argued a tort and not a taking.
The Court of Federal Claims responded by pointing out the weaknesses in the government’s defense, but has deferred any action on the motion to dismiss until the trial is completed, and the Court of Federal Claims has the benefit of all the evidence produced at trial.