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Selma Pressure Treating Co. v. Osmose Wood Preserving Co.

6/25/1990

tatute and case law suggest the state has a legally cognizable property interest in the waters of the state.


In Aerojet-General Corp. v. Superior Court (1989) 211 Cal. App. 3d 216 [258 Cal. Rptr. 684], the court's analysis lends credence to the notion that


the state's proprietary interest in the waters of the state support a claim for damages.


"Real parties also contend there can be no 'damages' under the policy because the government suits do not allege property damage . . . . With regard to the state and federal CERCLA complaints, real parties contend the suits are not for damages, but simply an exercise of police power . . . . With regard to the two state complaints, real parties claim there are no 'damages' involved because the state cannot sue for 'damages' as would a traditional, fee-simple-absolute property holder. Real parties assert that the concept of public ownership of water, presumably because limited to rights of use and regulation, is a '19th-century fiction.' The short answer to this contention is that real parties did not challenge the state's standing below, and should not be permitted to do so now. However, since we conclude real parties are mistaken and the issue could arise again, we resolve it here.


"In this state, all ownership of water is usufructuary; water rights decisions 'do not speak of the ownership of water, but only of the right to its use.' [Citation.] The state's property interest in groundwater, as established by Water Code section 102 . . . is no less usufructuary than that of private ownership, and public waters may be duly used, regulated and controlled in the public interest. [Citations.] The state's public trust interest in the navigable portions of the American River is similarly sufficient for standing to claim damages caused by environmental pollution. [Citation.]


"Unquestionably, the state and federal governments are third party property owners for purposes of insurance coverage. Pollution of the ground and river waters is damage to public property, as well as a direct injury to public welfare. [Citation.] Indeed, even real parties' authorities note the great weight of authority holding environmental contamination to be 'property damage.' [Citation.]" (Aerojet-General Corp. v. Superior Court, supra, 211 Cal. App. 3d at pp. 229-230, fn. omitted.)


We note also a line of cases recognize and protect the State's parens patriae interest in the air, land and waters of its territory. (See Georgia v. Pennsylvania R. Co. (1945) 324 U.S. 439, 451 [89 L.Ed. 1051, 1059, 65 S.Ct. 716]; Georgia v. Tennessee Copper Co. (1907) 206 U.S. 230 [51 L.Ed. 1038, 27 S.Ct. 618]; Kansas v. Colorado (1907) 206 U.S. 46, 99 [51 L.Ed. 956, 975, 27 S.Ct. 655]; Missouri v. Illinois (1906) 200 U.S. 496 [50 L.Ed. 572, 26 S.Ct. 268].) Where confronted with the issue, the courts have accorded the State the right to seek money damages based upon such interest. (Lansco, Inc. v. Department of Environ. Pro. (1975) 138 N.J.Super. 275 [350 A.2d 520, 524-525]; State of Maine v. M/V Tomano (S.D.Me. 1973) 357 F.Supp. 1097, 1101;


State, Dept. of Envir. Pro. v. Jersey Central P. & L. Co. (1973) 125 N.J.Super. 97 [308 A.2d 671], revd. on other grounds (1976) 69 N.J. 102 [351 A.2d 337]; State of Maryland, Dept. of N. Res. v. Amerada Hess Corp. (D.Md. 1972) 350 F.Supp. 1060, 1066-1067; see esp., State of Hawaii v. Standard Oil Company of California (D.Hawaii 1969) 301 F.Supp. 982, 984-988, revd. (9th Cir. 1970) 431 F.2d 1282, for an excellent background discussion of the doctrine.) This right of recovery is not diminished by the coexistence of express statutory r

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