Borgnemouth Realty Co. v. Parish of St. Bernard
141 So. 3d 891
La. Ct. App.2014Background
- Borgnemouth Realty owned land in St. Bernard Parish containing clay/soil used as "borrow" material for levee construction along the Mississippi River Gulf Outlet (MR‑GO).
- After storm damage in 2005, the parish president issued an executive commandeering order granting the Parish an assignable easement to "clear, borrow, excavate and remove" soil; that right was assigned to the Lake Borgne Basin Levee District and then to the U.S. Army Corps of Engineers. Borgnemouth sought compensation for 196,808 cubic yards removed.
- The Levee District asserted it already held rights to the land/material from 1967–1969 appropriations (a "faux‑servitude" under the St. Julien line) and therefore owed no further compensation; Parish and Levee District also raised other defenses including federal‑project/indemnity arguments.
- The district court found Borgnemouth owned the soil/clay, awarded compensation at $5.00 per cubic yard ($984,040) and attorney’s fees; Parish and Levee District appealed.
- The appellate court reviewed (de novo for legal issues; clearly‑erroneous/abuse‑of‑discretion for factual and award issues) and affirmed: Levee District’s 1967–1969 appropriations did not convey rights to excavate/remove subsurface soil or clay; Borgnemouth was entitled to full compensation and statutory attorney’s fees.
Issues
| Issue | Borgnemouth's Argument | Parish/Levee District's Argument | Held |
|---|---|---|---|
| Whether the Levee District’s 1967–1969 appropriations conveyed a right to excavate and remove subsurface soil/clay | The prior appropriations did not grant any right to remove subsurface materials; Borgnemouth retained ownership and entitlement to compensation | Levee District claimed it acquired an extra‑codal servitude (via St. Julien acquiescence) covering borrow/excavation rights | Held: No. The resolutions/letters established only rights of entry, rights‑of‑way and temporary spoil easements, not a right to exploit or remove subsurface soil/clay. |
| Whether Borgnemouth is entitled to just compensation for material taken in 2005 under state law | The commandeering order reserved ownership; taking of soil/clay required compensation under La. Const. art. 1 §4 and Mineral Code principles | Parish/Levee District contended the MR‑GO project/federal involvement or prior appropriations excused state actors from paying | Held: Borgnemouth entitled to full compensation from Parish and Levee District (solidarily). The taking was effected under state law by political subdivisions; federal indemnity does not relieve them of liability. |
| Proper valuation method and amount (highest and best use; $5/yd3) | Highest and best use was as a borrow pit; industry standard is valuation per cubic yard; testimony supported $4–$6/yd3, so $5/yd3 is reasonable | Defendants disputed highest‑and‑best‑use and valuation | Held: Trial court’s factual findings that highest and best use was borrow pit and $5/yd3 valuation were not clearly wrong; award affirmed. |
| Award of attorney’s fees under La. R.S. 13:5111 (reasonableness/amount) | Borgnemouth sought fees per contingency; trial court awarded statutory reasonable fees | Defendants argued award excessive/unreasonable | Held: Award of attorney’s fees was statutorily authorized and within trial court’s discretion; appellate court affirmed the fee award (adjusted for settlements). |
Key Cases Cited
- Continental Group, Inc. v. Allison, 404 So.2d 428 (La. 1981) (recognizing that “minerals” may include the soil itself)
- DeSambourg v. Bd. of Comm’rs for Grand Prairie Levee Dist., 621 So.2d 602 (La. 1998) (scope of levee servitude under La. Civ. Code art. 665)
- West Jefferson Levee Dist. v. Coast Quality Constr. Corp., 640 So.2d 1258 (La. 1994) (standards for highest and best use and valuation in takings)
- Nolan v. Mabray, 51 So.3d 665 (La. 2010) (valuation and use principles for expropriation matters)
- Cooter & Gell v. Hartmarx Corp., 496 U.S. 384 (1990) (standard on appellate review of factfinding and discretion)
- Suire v. Lafayette City‑Parish Consol. Gov’t, 907 So.2d 37 (La. 2005) (principle that indemnitor is not liable until indemnitee pays or sustains loss)
- Lake, Inc. v. La. Power & Light Co., 330 So.2d 914 (La. 1976) (treatment/limitations of St. Julien doctrine)
- Joseph v. Hosp. Serv. Dist. No. 2 of Parish of St. Mary, 939 So.2d 1206 (La. 2006) (analysis of third‑party beneficiary/stipulation pour autrui)
- Williamson v. State, Dept. of Transp. and Dev., 597 So.2d 439 (La. 1992) (factors for assessing attorney’s fees in takings cases)