Daily Development for
Wednesday, April 15, 1998

by: Patrick A. Randolph, Jr.
Professor of Law
UMKC School of Law

TAKINGS; GOVERNMENT MONITORING WELLS: Landowners are not entitled to compensation from the United States for well easements and access corridors constructed on their property by the U.S. Environmental Protection Agency.

Hendler v. United States, 38 Fed. Cl. 611 (Cl. Ct. 1997).

The U.S. EPA installed wells to monitor and determine the extent of groundwater contamination under Plaintiff's property. The project involved taking twenty 50 by 50 foot square well easements, each with an accompanying 16 foot wide access corridor to a public right of way. The court held that even though Plaintiff had not caused the pollution, the spreading groundwater contamination beneath his property constituted a public nuisance. As such, the installation of the monitoring wells would not constitute a regulatory taking since, under Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992), a government action to abate a nuisance is not a regulatory taking.

The court further held that the physical taking of Plaintiff's property was not compensable. The installation of the monitoring wells conferred "special benefits" on the plaintiff valued at $100,000 or more, since without them Plaintiff would have had to have undertaken similar tests and analyses of the groundwater contamination in order to develop the property. The value of these special benefits exceeded the amount by which the installation of the wells reduced the value of Plaintiffs' property, and so no compensation was due.

Comment 1: Although the notion that one who has not created a nuisance on his property is nevertheless liable to terminate it may strike some as inappropriate, it nevertheless is the current common law of California, where these facts arose. Newhall Land & Farming Co. v. Superior Court, 19 Cal.App.4th 334, 23 Cal.Rptr.2d 377, 382 (1993). This also appears to be the rule under Section 834 of the Restatement of Torts. Whether it is the traditional common law rule may be another question. And then, of course, there is the question of exactly what "common law" is the measure of the takings question in Lucas. Is it the original English common law, or is it whatever the courts of our nation determine it to be over time? If neither of those, what law do we use?

Comment 2: On the physical taking side, the court rejected the California rule that takes into account benefits conferred only with regard to severance damages, and not with regard to property actually taken. The court held that a federal rule applies here, which permits general offset. It then appears to have credited testimony holding that the plaintiff benefitted to the extent of the total cost of the wells project, as it would not otherwise been able to develop the property without doing the same tests. The case is somewhat scarifying, obviously, as it basically holds that the government can criss cross your land with easements to monitor what is essentially a public problem not of your doing, and that it can refuse any payment for this physical taking by demonstrating that you are benefitted by it. Probably an accurate statement of current law, and no worse than CERCLA, but scarifying nonetheless.

Comment 3: Note that, unlike CERCLA, one has no "good faith purchaser" defense here. Lawyers representing purchasers at least ought to keep this case in mind before they provide assurances to their clients that a good faith inspection of property they are acquiring will resolve potential issues of environmental liability.

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