Our Pipeline Safety Group’s experience in handling pipeline explosion and release cases over the years has often included the legal question of whether the owner of real property adjacent to such catastrophes may claim diminished fair market value as damages. Since this usually involves a fairly limited number of situations where there is physical injury to the adjacent property, such as from a resulting fire, the more serious concern of the facility owners has been whether a larger class of owners in the neighborhood could make such claims even in the absence of physical injury to their property.
As the evidence mounts in regard to the vulnerability of the aged PG&E gas lines near the site of the San Bruno Pipeline Explosion, there is little doubt that such issues are already being debated. Though about 30 homes were burned in that explosion, many hundreds more in the vicinity are arguably at risk to the consequences of future explosions caused by metallurgical weaknesses in the nearby underground gas lines. In today’s skittish real property market, such a concern by homebuyers could cause real estate values in San Bruno to plummet even further.
Any analysis needs to begin with identifying the nature of the legal theories that could be alleged against pipeline owners, ranging from negligence and trespass to ultrahazardous activity causes of action. It is reasonably well settled that physical injury is probably required under these particular legal theories but a nuisance theory could arguably yield a different result.
A “nuisance” is defined under California law as “anything which is injurious to health . . . or an obstruction to the free use of property, so as to interfere with a comfortable enjoinment of life or property.” (Civ. Code § 3479.) To maintain a private cause of action for nuisance, a homeowner needs to demonstrate interference with his or her use and enjoyment of the real property that causes “substantial actual damage.” If the nuisance is only temporary then a plaintiff might recover for loss of use but prospective damages such as diminution in value or stigma are not recoverable. (Santa Fe Partnership v. ARCO Products (1996) 46 Cal.App.4th 967, 976.)
However, to the extent that a pipeline is deeply embedded in the ground such that, unless it is completely replaced, it might be deemed “permanent,” the rule could be different. In San Diego Gas & Electric Co. v. Superior Court (1996) 13 Cal.4th 893, the California Supreme Court ruled that “in distinction to trespass, liability for nuisance does not require proof of damage at the plaintiff’s property; proof of interference for the plaintiff’s use and enjoinment of a property is sufficient . . .” although there are two additional exacting requirements. One of them is that the invasion of the plaintiff’s interest in the use and enjoyment of the land must be substantial (“definitely offensive, seriously annoying or intolerable”). Secondly, the interference must be unreasonable, defined objectively in terms of what an ordinary person would conclude in weighing the risks and benefits of having the pipeline in the area and based upon “scientific facts.”
EMF or electromagnetic frequency lines have been the most recent subject of scrutiny in this area. While some courts held that a fear of future harm will not support a cause of action for private nuisance, other Courts found that such a fear may be sufficient (e.g., County of San Diego v. Carlsrom (1961) 196 Cal.App.2d 485, 491). Courts in several other states have agreed. (See, e.g., NashuaCorp. v. Norton Corp. (2000) 116 F.Supp.2d 330; Louis v. General Electric (D. Mass. 1999) 37 F.Supp.2d 55, 61.)
As to San Bruno, the creative talents of class action attorneys will soon be tested in constructing theories that highlight the alleged terror of living near a virtual time bomb, together with expert opinions on both statistical reoccurrence and impact on marketability. But in response, defense counsel will point to the speculative nature of any future explosion, particularly where, as in the San Bruno explosion, a contributing factor (along with pipeline weakness) may have been a temporary rise in internal pressure, a circumstance whose reoccurrence would likely be derived by conjecture or unproven science. For further questions, please contact William H. G. Norman, member of
Cooper, White & Cooper’s Energy, Environmental and Pipeline Safety Group, which has been engaged in multiple pipeline explosion and petroleum release cases including the 2004 Walnut Creek explosion, the Suisun release, Cosco Busan and Deepwater Horizon.