Court rejects flood-related ‘taking’ claim against western NC town

A couple cannot sue the town of Marshall for inverse condemnation related to a 2019 flooding incident that left the couple’s rental property uninhabitable. The state Court of Appeals upheld on Wednesday a lower court’s ruling against Carl and Stephanie Firley.

The Firleys argued that Marshall failed to maintain a storm pipe that clogged during the flooding and contributed to the property damage.

“Plaintiffs argue that the trial court erred in concluding that Defendant did not ‘take’ their property at 632 Walnut by failing to adequately maintain the storm pipe,” Judge Thomas Murry wrote for a unanimous three-judge Appeals Court panel. “Both our State Constitution and statutes ‘protect against an uncompensated taking and the fundamental right to just compensation’ against the State government or one of its municipal subsidiaries. But an occupation need not be physical; a municipality may affect a taking by ‘substantial[ly] interfer[ing] with elemental rights growing out of the ownership of the property’ — even if doing so accidentally.”

“More specifically, ‘increased flooding’ and land damage as a ‘foreseeable direct result of government structures’ may substantially interfere with a plaintiff’s property rights to an actionable degree,” Murry added. “Because this situation ‘effectuates a taking without first initiating a formal condemnation proceeding,’ though, an injured party may ‘obtain just compensation [only] through an action in inverse condemnation’ under N.C.G.S. § 40A-51.”

Murry focused on a 2009 precedent involving the Asheville city government. In that case, a plaintiff sued the city after a failed stormwater drainage system installed by a previous property owner created a sinkhole in the plaintiff’s parking lot. The state Appeals Court ruled in favor of Asheville after determining that the city never used the storm drains, never controlled its pipes, and never repaired the system.

“In short, the Asheville Court could discern no legal or factual control of any municipal instrumentality that somehow caused the damage alleged by the plaintiff,” Murry wrote.

“So too here,” he added. “In their initial complaint and here on appeal, Plaintiffs’ argument hinges on the storm pipe’s failure to safely channel excess rainwater and debris from the surrounding landscape. But a municipality must ‘undert[ake] to erect [the] structure’ for this purpose to open itself to liability from this ‘reasonably foreseeable’ failure.”

“Through gritted teeth, Plaintiffs concede at trial and on appeal that Defendant ‘did not install the storm pipe,’” Murry explained. “They also acknowledged at trial that Defendant ‘never maintained the pipe’ next to the ‘ditch’ because it ‘do[es]n’t have the resources.’”

The Firleys relied instead on expert testimony about “tangential benefits” for the town from the storm pipe collecting water from the top of a hill above the damaged property, Murry wrote.

“But to maintain an inverse-condemnation suit as a matter of law, our case law has consistently required at least some degree of municipal appropriation of a utility before the alleged injury,” the opinion continued.

Part of the Firleys’ case relied on an expert witness testifying that the damage resulted after a rainfall of just 0.59 inches.

“Here, competent evidence clearly supports the trial court’s findings that a ‘serious flooding’ from ‘a heavy rain event’ caused ‘major landslides’ collapsing Candler Drive,” the street above the Firleys’ property, Murry wrote. The Firleys “would have no reason to bring suit absent this landslide causation. Their complaint would similarly fall apart had the driveway’s landslide collapse not ‘completely fill[ed] the storm pipe with mud and debris.’”

The trial judge “could reasonably infer ‘a level of rainfall far in excess’” of 0.59 inches “based on ‘Plaintiffs’ [own] photographs’ of the scene and the sitting Governor’s concurrent emergency declaration,” Murry wrote.

Judge Jefferson Griffin joined Murry’s opinion. Judge Christopher Freeman concurred in the case’s result without signing on to Murry’s ruling.

“Court rejects flood-related ‘taking’ claim against western NC town” was originally published on www.carolinajournal.com.