Daily Development for
Friday, May 1, 1998

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

CONSTITUTIONAL LAW; TAKINGS; REGULATORY TAKINGS: County may be liable in inverse condemnation, where, as part of subdivision approval process, it participates in the design of a water drainage system for a private developer that makes use of public land and ultimately is managed by County.

Phillips v. King County, 943 P.2d 306 (Wash. App. Div. 1 1997).

The Washington Court of Appeals held that by exercising its police power to approve and regulate the use of a development by approving a water drainage system and then assuming ownership, maintenance and control over that system, a County appropriated a flowage easement over a neighbor's property when the water flow on the neighbor's property increased several fold.

Unlike the lower court, which had dismissed the plaintiff's claims on summary judgment, the Washington Court of Appeals concluded that a rational trier of fact could determine that the plaintiff was receiving much more surface water than would be expected than from the mere fact that trees and foliage had been removed and the paving of streets had been completed.

The court held that the County was not liable in negligence or nuisance for its activities, as it was performing a public function and benefitted from sovereign immunity. But this protection does not extend to potential liability for inverse condemnation where the County's activiities amount to a "taking" of adjacent property through physical occupation by means of water runoff.

The court differentiated between ordinary land use decisions by the County, which might lead to greater intensity of development, and consequential increases in water runoff, and County planning activities pointedly designed to collect and divert water runoff through artificial channels. In the former case, the County will not be held liable when there is increased runoff injuring the neighbors. In the latter case the County may be liable.

Although neither this case nor precedent case involved a situation in which a public entity only ordered the channeling of water, as opposed to owning and maintaining drainage systems on its own property, the court indicated that implicit in its holding was the conclusion that merely ordering the artificial channelling of water from one private landowner's land to another's may result in an inverse condemnation claim against the agency.

The court also permitted to go forward a tort action against the developer who, in the process of an elaborate administrative proceeding, formulated the drainage plan that the County eventually approved.

Note: In an interesting sidelight to the case, the court held that the plaintiff was not barred from bringing its action because it had not exhausted administrative remedies in the preliminary land use actions through which the defendant developer had obtained its permit to construct the drainage system. The plaintiff had participated in these proceedings and objected to the system at that time, but took no appeal. The court held that third parties who are not applicants for a public permit are not barred in subsequent negligence or takings actions by failing to exhaust administrative remedies to appeal from the granting or denial of that permit.

Comment 1: There is considerable discussion in the case as to whether the drainage system in question really was a "reasonable" response to the water drainage issue. The court cites evidence that the drainage system was outdated when installed, and that other solutions would have afforded the plaintiff greater protection.

But is it necessary to allege that the increased flow could have been provented by other drainage methodologies? Isn't it sufficient simply to point out that the County deliberately ordered the construction of a system that would lead to vastly increased runoff on neighboring property? Whether this was a sensible application of the police power is beside the point in a takings claim. (But see Comment 2.)

Comment 2: Keep in mind that this case involves liability for rechanneling water under a system of water rights that concludes that a landowner has a right to be free of the impact of rechannelled waters diverted from one neighboring property through artificial channels. Not all jurisdictions would view such a right as part of the fundamental ownership rights in land. The unmodified "common enemy" theory, for instance, would permit disposal of naturally occuring surface water however one can do it. In jurisdictions following this rule (assuming there are some left), an owner might not be able to argue that the government had "taken" a property right when, by its regulatory decisions, it increased water flowage onto the neighbor's property.

The editor has not explored all the nuances of water law in the state of Washington. Is it possible that a Washington landowner's only protection is from water nuisance is from an "unreasonable" increase in water flow from articifical channeling? If that is the case, then perhaps the issue of whether this was the best alternative for a drainage system does become relevant (see Comment 1.)

Comment 3: This case is hardly the first standing for the proposition that government can be liable for a taking when it rechannels water. But the candid admission by the court that a a public agency can be liable for approving and permitting a drainage system on private land is not something one sees every day, and could be a valuable precedent. Further, the exhaustion of remedies holding also is a valuable precedent in this complex and challenging area of law.

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