City of Keizer v. Lake Labish Water Control District

• Decision Date: 26 December 2002
• Citation: 185 Or.App. 425,60 P.3d 557
• Parties: CITY OF KEIZER, a municipal corporation, Appellant, v. LAKE LABISH WATER CONTROL DISTRICT, a municipal corporation, Respondent.
• Court: Oregon Court of Appeals

60 P.3d 557

185 Or.App. 425

CITY OF KEIZER, a municipal corporation, Appellant, v. LAKE LABISH WATER CONTROL DISTRICT, a municipal corporation, Respondent.

00C-11402; A113784.

Court of Appeals of Oregon.

Argued and Submitted May 9, 2002.

Decided December 26, 2002.

Robert E. Franz, Jr., Springfield, argued the cause and filed the briefs for appellant.

Laura A. Schroeder, Portland, argued the cause for respondent. With her on the brief were Justin D. Gericke and Schroeder Law Offices, P.C.

Before LANDAU, Presiding Judge, and BREWER and SCHUMAN, Judges.

LANDAU, P.J.

Plaintiff, the City of Keizer (city), initiated this action for inverse condemnation against defendant, the Lake Labish Water Control District (district), alleging that the district flooded city property, causing damage. The district moved to dismiss on the ground that the law does not permit one governmental entity to bring a claim for inverse condemnation against another governmental entity. The trial court agreed and dismissed the inverse condemnation claim. The city appeals, arguing that it is not precluded as a matter of law from bringing an inverse condemnation claim against the district. We agree and reverse and remand.

The city's complaint alleges the following facts. The district is a water control district formed in accordance with ORS chapter 553. The district owns, operates, and maintains a protective dike and pumping plant for flood protection. The plant is known as the Little Pudding River Watershed Project. The dike itself is known as the Parkersville Dam. The water that accumulates on the west side of the Parkersville Dam is Lake Labish, fed by the Little Pudding River, which naturally flows east toward the dam. The plant is capable of pumping water from Lake Labish into a waterway that spans the east side of the Parkersville Dam and is known as the Big Pudding River.

The city is a municipal corporation located in Marion County. The city owns a park located next to the Labish Ditch, which flows into Lake Labish, and a bridge located across the ditch. The park and the bridge are located within the city's boundaries.

In January and February of 1996, the water level behind the Parkersville Dam rose significantly. The district, however, chose not to pump the water into the Big Pudding River to protect onion fields owned by members of the district located east of the dam. As a result, water west of the dam backed up and flooded the Labish Ditch and the park and damaged the city's bridge.

The following winter, it became apparent that the water level behind the dam once again was going to rise and that flooding might occur. The city contacted the district and requested that the district pump water into the Big Pudding River. The district decided against doing that, resulting in the flooding of the city's land and the destruction of the bridge.

The city initiated an action for damages and injunctive relief. In its first claim, it alleged that it was entitled to damages for inverse condemnation. The city alleged three different counts within that claim for relief. In Count One, the city alleged entitlement to relief under Article XI, section 4, of the Oregon Constitution. In Count Two, it alleged entitlement to the same relief under ORS 553.090 and ORS 553.270. And, in Count Three, it alleged entitlement to the same relief under Article I, section 18, of the Oregon Constitution.

The district moved to dismiss for failure to state a claim. ORCP 21 A(8). The district argued that, as a matter of law, only a private individual may bring a claim for damages for inverse condemnation. The trial court agreed and entered an ORCP 67 B judgment dismissing the first claim. The city appeals, assigning error to the dismissal of the first claim.

We review the trial court's dismissal for failure to state a claim for errors of law. Yanney v. Koehler, 147 Or.App. 269, 272, 935 P.2d 1235, rev. den., 325 Or. 368, 939 P.2d 45 (1997). We begin with the statutory basis for the city's claim and then, if necessary, address the claim's constitutional bases. State v. Nielsen, 316 Or. 611, 618, 853 P.2d 256 (1993).

The city contends that it is entitled to bring a claim for inverse condemnation against the district pursuant to ORS 553.090 and ORS 553.270. The former statute authorizes a water control district to condemn real property:

"A water control district formed under the provisions of this chapter shall constitute a governmental subdivision of this state, and a public body, corporate and politic, exercising public power. It shall have full power to carry out the objects of its creation and to that end may:

" * * * * *

"(4) Acquire by condemnation, purchase, devise, gift or voluntary grant real and personal property or any interest therein, located inside or outside of the boundaries of the district."

ORS 553.090. The latter statute extends that right to property that already is devoted to some other public use:

"The right to condemn property, given pursuant to ORS 553.090(4) shall include property already devoted to public use, including state and county property, which is less necessary than the use for which it is required by the district. In the acquisition of property or rights by condemnation, the board shall proceed in the name of the district under the provisions of the laws of Oregon."

ORS 553.270.

The city contends that the foregoing statutes at least implicitly authorize actions for inverse condemnation against water districts that acquire property—public or private—without going through the condemnation process. The district responds that merely because a statute authorizes it to condemn property does not mean that an action for inverse condemnation is available whenever it damages property without exercising that statutory authority. According to the district, "inverse condemnation" may be alleged only when property has been taken in violation of constitutional guarantees. We conclude that neither party is entirely correct.

The term "inverse condemnation" is one coined by courts to refer to an action for damages asserted against a governmental entity with the power of eminent domain that has taken property without doing so through condemnation proceedings. Dept. of Transportation v. Hewett Professional Group, 321 Or. 118, 130-31, 895 P.2d 755 (1995); ODOT v. Winters, 170 Or.App. 118, 122-23, 10 P.3d 961 (2000), rev. den., 332 Or. 239, 28 P.3d 1174 (2001). It is denominated "inverse" condemnation because the taking occurs before the initiation of condemnation proceedings, which is the inverse of the ordinary sequence of events when a governmental entity exercises its power of eminent domain.

Most commonly, an action for inverse condemnation is based on a violation of the "takings" clauses of either the state or federal constitution. The Oregon Constitution includes two such provisions. Article I, section 18, provides, "Private property shall not be taken for public use * * * without just compensation." Similarly, Article XI, section 4, provides, "No person's property shall be taken by any corporation under authority of law, without compensation being first made, or secured in such manner as may be prescribed by law." The Fifth Amendment to the United States Constitution likewise provides, in part: "nor shall private property be taken for public use, without just compensation."

The underlying theory of an action for inverse condemnation arising under the state or federal constitution is that the constitutional takings provisions are "self-executing" limitations on government authority. See, e.g., Tomasek v. Oregon Highway Com'n, 196 Or. 120, 143-47, 248 P.2d 703 (1952) ("The constitutional right and protection given the owner of property by art. 1, § 18, Oregon Const., supra, is unquestionably self-executing."); United States v. Clarke, 445 U.S. 253, 257, 100 S.Ct. 1127, 63 L.Ed.2d 373 (1980) (inverse condemnation claim under the Fifth Amendment derives from " `the self-executing character of the constitutional provision with respect to compensation' ") (quoting P. Nichols, 6 Eminent Domain § 25.41 (3d rev. ed. 1972)). In other words, because the constitution says that the state must pay for property that it has taken, when the state takes property without paying, the courts may enforce the constitution by requiring the state to pay. As the Oregon Supreme Court explained in Tomasek:

"If there is a taking by the state without compensation being first assessed and tendered, it manifestly would be absurd to attribute to the framers of the constitution an intention that the state might destroy the right and protection given the owner of property and evade the payment of just compensation, simply through the medium of failing or refusing to institute condemnation proceedings."

196 Or. at 147, 248 P.2d 703.

That said, the Oregon courts have never held that a violation of the state or federal constitution is the only basis for an inverse condemnation claim. To the contrary, the Oregon Supreme Court has said that a claim for inverse condemnation is not necessarily exclusively constitutional:

" `Inverse condemnation' is neither a constitutional nor a statutory term but only the popular description of a cause of action against a governmental defendant to recover the value of property which has been taken in fact by the governmental defendant, even though no formal exercise of the power of eminent domain has been attempted by the taking agency. Actions to recover compensation for such a governmental taking long preceded the label[.]"

Suess Builders v. City of Beaverton, 294 Or. 254, 258 n. 3, 656 P.2d 306 (1982) (citation, internal quotation marks omitted). Thus, the legislature could authorize a landowner to seek damages for a governmental taking of property without compensation as, in fact, a number of other state legislatures have done. See, e.g., Ind. Code § 32-24-1-16 (1997) ("[a] person having an interest in property that has been or...