An appellate court has found the state liable for costly damages to property in Yuba County as the result of a 1986 Yuba River levee failure. The decision arrived within days of Gov. Schwarzenegger's reduction of $105 million from local flood control project budgets, and the decision comes as construction of thousands of homes in the same floodplain proceeds.
The unanimous three-judge panel of the Third District Court of Appeal based its ruling on the theory of inverse condemnation. Essentially, because many people with billions of dollars worth of property rely on the giant Sacramento River Flood Control Project, all landowners — not only those who were harmed — should carry the burden of the plan's failure, the court ruled.
The court sent the 17-year-old case back to the trial court for a decision on damages. About 3,000 landowners initially sought $120 million to $150 million in damages. With interest, that amount could easily top $300 million. The appellate court also awarded the landowners all attorneys' fees and litigation costs, estimated at more than $10 million.
In February 1986, the Linda Levee failed, inundating the unincorporated communities of Linda and Olivehurst, south of Marysville. The levee was originally built by Yuba County in 1904 and 1905, when men with horses heaped soil on top of mining debris near the river. Over the years, the levee apparently was upgraded but, according to one witness, never met any engineering standards. The state and federal governments took over the flood control project during the 1920s, and the state assumed sole control three decades later. In 1970, Reclamation District 784, which maintains the levy for the state, warned that the levy may not withstand "violent river flows." In 1986, the levy failed despite carrying only half of its capacity.
In an earlier round of the case, the Third District upheld a jury verdict that the state was not liable based on the dangerous condition of a public facility (Paterno v. State of California, 74 Cal.App.4th 68). But the Third District sent the question of inverse condemnation back to the trial court. Yuba County Superior Court Judge John Golden ruled that the state was not liable based on inverse condemnation, either. The case then returned to the Third District, which reversed Judge Golden.
"A public entity cannot be held liable for failing to upgrade a flood control system to provide additional protection," Justice Fred Morrison wrote. "But the trial court found the levee was built with porous, uncompacted mining debris, in a location which encouraged seepage, leading directly to the failure of the levee, and that long before the failure, feasible cures could have fixed the problems."
The state argued that the levy failed as a result of natural causes. But the Third District disagreed.
"In this case the evidence overwhelmingly shows the failure of the levy was foreseeable," Morrison wrote. "It [the state] operated the levee for three-quarters of a century and had ample opportunity to examine it. If it chose not to do so for fiscal reasons, that would indicate the loss should be absorbed by the state."
Paterno v. State of California, No. C040533, 03 C.D.O.S. 10309, 2003 DJDAR 12879. Filed November 26, 2003.
For Paterno: Gary Livaich, Desmond, Nolan, Livaich & Cunningham, (916) 443-2051.
For the state: Sterling Smith, attorney general's office, (916) 445-0378.