Paterno v. State

• Decision Date: 26 November 2003
• Docket Number: No. C040553,C040553
• Citation: 6 Cal.Rptr.3d 854,113 Cal.App.4th 998
• Court: California Court of Appeals Court of Appeals
• Parties: Peter PATERNO et al., Plaintiffs and Appellants, v. STATE of California et al., Defendants and Respondents.

6 Cal.Rptr.3d 854

113 Cal.App.4th 998

Peter PATERNO et al., Plaintiffs and Appellants, v. STATE of California et al., Defendants and Respondents.

No. C040553

Court of Appeal, Third District

November 26, 2003

As Modified on Denial of Rehearing December 24, 2003

Review Denied March 17, 2004.

Desmond, Nolan, Livaich & Cunningham, Gary Livaich, David Collins, and Richard F. Desmond, Sacramento, and Law Office of Clifford E. Hirsch; Howard, Rice, Nemerovski, Canady, Falk & Rabkin, Jerome B. Falk, Jr., and Simon J. Frankel, San Francisco, for First Union Real Estate Equity & Mortgage Investments; Kronick, Moskovitz, Tiedemann & Girard and Lloyd Hinkelman; Law Offices Of Stanley Bell, Sally G. Bergman; Robins, Kaplan, Miller & Ciresi, and Scott G. Johnson, Los Angeles; and Frederick A. Jacobsen for Plaintiffs and Appellants.

Bill Lockyer, Attorney General, Andrea Hoch, Chief Assistant Attorney General, Darryl Doke, Supervising Deputy Attorney General, Sterling A. Smith, Deputy Attorney General, for State of California; G. Steven Jones, La Jolla, and Carl R. Lindmark, Yuba City, for Reclamation District 784, Defendants and Respondents.

MORRISON, J.

The environmental aftermath of the Gold Rush continues to plague California. Hydraulic mining debris caused flooding which led to the building of levees at the confluence of the Yuba and Feather Rivers. Almost a century ago the Linda levee was built with uncompacted mining debris, and the use of that debris caused the levee to collapse on February 20, 1986.

About 3,000 plaintiffs sued the State of California (State), Reclamation District 784 (District) and others not now parties, seeking damages. In Paterno v. State of California (1999) 74 Cal.App.4th 68, 87 Cal.Rptr.2d 754 (Paterno I), we affirmed a defense jury verdict finding no dangerous condition of public property and reversed an inverse condemnation liability finding against defendants, and remanded for another trial on inverse liability. A new coordination judge (Hon. John J. Golden), conducted a lengthy court trial and issued a defense judgment against sample plaintiffs (collectively, Paterno) who filed this appeal.

Paterno embraces Judge Golden's factual findings, which in his view, create inverse liability on the part of the State as a matter of law. We agree. When a public entity operates a flood control system built by someone else, it accepts liability as if it had planned and built the system itself. A public entity cannot be held liable for failing to upgrade a flood control system to provide additional protection. 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. Use of such technology would not have been an upgrade, but would have ensured the planned flood control capacity was achieved.

Inverse liability stems from the California Constitution and is not dependent on tort or private property principles of fault. (See Albers v. County of Los Angeles (1965) 62 Cal.2d 250, 261-262, 42 Cal.Rptr. 89, 398 P.2d 129 (Albers ).) California Supreme Court precedent dictates that a landowner should not bear a disproportionate share of the harm directly caused by failure of a flood control project due to an unreasonable plan. Whether the plan is unreasonable is not measured by negligence principles, as in a tort case alleging a dangerous condition of public property, but by balancing a number of specific factors referred to as the Locklin factors. (Locklin v. City of Lafayette (1994) 7 Cal.4th 327, 27 Cal.Rptr.2d 613, 867 P.2d 724 (Locklin).) Based on the facts found by the trial court and application of the Locklin factors, we conclude Paterno's damages were directly caused by an unreasonable State plan which resulted in the failure of the Linda levee and the State is liable to pay for Paterno's damages. In large part our conclusion is based on the fact that the levee system benefited all of California and saved billions of dollars and to require Paterno to bear the cost of the partial failure of that system — a failure caused by construction and operation of an unstable levee — would violate Locklin. A basic part of the State's flood plan was to accept existing levees as much as possible, to reduce the cost of an extensive, coordinated, flood-control system. The People benefited from that cost-saving feature. However, the record shows that State never tested the Linda levee, or reviewed the records of its construction, to see if it was as strong as the global plans assumed it was, and the State even ignored specific warnings about the levee's weaknesses. In such circumstance, the costs of the levee failure must be deemed part of the deferred costs of the project. We do not separately address an alternate theory that the State is liable because of an inadequate levee inspection plan, although we discuss the lack of any plan to examine the heart of the levee.

Although in some ways the District is a coparticipant with the State in operating the levee, we conclude it is entitled to judgment. The District was responsible for and only for ordinary maintenance and could not alter the structure of the levee, even if it had the financial means to do so.

We will affirm the judgment in favor of the District, reverse the judgment in favor of the State with directions to enter judgment in favor of Paterno, and remand for further proceedings. In making this order, we realize this case is as hoary as Jarndyce v. Jarndyce. We expedited this appeal, and counsel assisted this court by providing much of the record and the briefs in computerized format. We will direct that this case be given priority in the trial court and that all available means to expedite the remaining triable issues be implemented.

BACKGROUND FACTS

Much of the evidence from the first trial was introduced on retrial and although we set out the trial court's findings in this opinion, the interested reader should review Paterno I. (See Paterno I, supra, 74 Cal.App.4th at pp. 75-91, 96-99, 87 Cal.Rptr.2d 754.) Judge Golden adopted parts of Judge Lorenzo Sawyer's decision in Woodruff v. North Bloomfield Gravel Mining Co. (C.C.D.Cal.1884) 18 Fed. 753 (Woodruff), which famously declared certain hydraulic gold mining practices to be a nuisance. Woodruff helps explain the origin of Linda levee's problems.

"Hydraulic mining ... is the process by which a bank of gold-bearing earth and rock is excavated by a jet of water, discharged through the converging nozzle of a pipe, under great pressure, the earth and debris being carried away by the same water, through sluices, and discharged on lower levels into the natural streams and water-courses below." (Woodruff, supra, 18 Fed. at p. 756.) The technology improved until large pipes, or monitors, could discharge 185,000 cubic feet of water per hour at a speed of 150 feet per second, and "at the North Bloomfield, several of these Monitors are worked, much of the time, night and day, the several levels upon which they are at work being brilliantly illuminated by electric lights, the electricity being generated by water power. A night scene ... is in the highest degree weird and startling, and it cannot fail to strike strangers with wonder and admiration." (Id. at p. 757.)

But admiration was far from universal. The environmental damage is indescribable, and must be seen at the Malakoff Diggins State Historic Park to be believed. (See Woodruff, supra, 18 Fed. at p. 757 [scale of project "can only be duly appreciated by actual observation"].) Millions of cubic yards of "slickens" (fine wet mining debris) filled up the river beds and ruined vast agricultural tracts. (Id. at pp. 758-760.) Levees built to protect Linda township failed in 1881 and 1883 and the space between the levees filled with debris. (Woodruff, supra, 18 Fed. at pp. 760, 765-767.)

"The California Debris Commission (CDC) was formed by Congress [in 1893] to counter the effects of hydraulic mining" and the Army Corps of Engineers (Corps) worked on the Yuba. (Western Aggregates, Inc. v. County of Yuba (2002) 101 Cal.App.4th 278, 287, 130 Cal.Rptr.2d 436; see 33 U.S.C.A. § 661; Gray v. Reclamation District No. 1500 (1917) 174 Cal. 622, 628-630, 163 P. 1024 (Gray ).) In 1911, the State adopted the Jackson Report as its flood control plan. (Reclamation District v. Riley (1923) 192 Cal. 147, 149-150, 218 P. 762 (Riley).) On appeal the State describes the report as "a skeletal or conceptual plan for a flood control system to be developed over time with the benefit of further studies and experience...." (See Gray, supra, 174 Cal. at pp. 629-630, 163 P. 1024 ["the details of it were still to be worked out. The reclamation board ... was called into existence to do these things"].) The Sacramento River Flood Control Project (SRFCP) was based on the Grant Report (a modification of the Jackson Report) approved by California in 1925 and by Congress in 1928. (American Riv. Flood Control Dist. v. Sweet (1932) 214 Cal. 778, 781-782, 7 P.2d 1030; Beckley v. Reclamation Board (1962) 205 Cal.App.2d 734, 740-741, 23 Cal.Rptr. 428 (Beckley); 11 Ops.Cal.Atty.Gen. 93, 93-94 (1948); Wat.Code, § 8525 [report as modified approved as a plan for flood control].)

"In 1953, the SRFCP works were transferred to the state. A memorandum of understanding confirmed the state's obligation to operate and maintain all completed works of the SRFCP and to hold the federal government harmless. The state turned the levees over to [local reclamation] districts for maintenance and operation but maintained responsibility for the project." (Akins v. State of California (1998) 61 Cal.App.4th 1, 11, 71 Cal.Rptr.2d 314 (Akins).) The State agreed to this plan for financial reasons. (See 9 Ops.Cal.Atty.Gen. 87, 89-91 (1947).) At trial the State took responsibility for "policy-making functions as they...