Monday, July 06, 2009

Modification and Lowering of Old Levees

Gannon v. Rumbaugh, no. 07-0889 (Iowa Ct. App. July 2, 2009).

Rumbaugh modified a levee on their land and either constructed a dam or put fill in a ditch which, it was alleged, caused flooding on the adjoining lands owned by Gannon and Steenhoek. The trial court found for the plaintiffs-in fact, adopting their proposed finding of facts and conclusions of law verbatim- and this appeal followed.

It was determined that a drainage district was established in the early 1900s that built levees in the area to prevent flooding from Clear Creek and Indian Creek. The drainage district was moribund, not having made assessments in seventy years or more. The Rumbaughs lowered the levee on their property in 2002 and made other alterations.

The Court of Appeals found that the trial court's finding of a nuisance was against the clear intent of Iowa Code ch. 654B, in that no request for mediation was ever made. The court thus dismissed the finding of a nuisance.

The court found that the Steenhoek's negligence claim for changes to the roadside ditch could stand, but denied the plaintiff's claim that the elimination of the old levee caused surface water to flow across their lands. The court further found that their was no evidence that the drainage district was now authorized by law since it had been abandoned many years ago.

Look Before You Dig

BP Pipelines v. Bockenstedt, no. 08-1681 (Iowa Ct. App. July 2, 2009)

Fitzpatrick owns farmland in Delaware County that he leases to his son. BP owns a gasoline pipeline that runs under the land, and its presence is marked. The Fitzpatricks hired Bockenstedt to install tile in an area at the rear of the farm near some waterways.

You see where this is going, right?

Bockenstedt was operating a tile plow when he punctured BP's pipeline, liberating 8,400 gallons of product.The Bockenstedts were fined by the state for not contacting the state's excavation hotline before they put plow to soil, and they were sued by BP for repairs to their pipeline and the expense of removing the spilled product and environmental remediation.

Bockenstedt, in turn, sued Fitzpatrick, alleging that Fitzpatrick failed to warn them of the pipeline. This claim was dismissed via summary judgment and this appeal followed.

The Court of Appeals found that Fitzpatrick was not liable for Bockenstedt's failure to contact the notification center. In addition, the court determined that Fitzpatrick's direction as to where the tile should be laid established liability under the retained control doctrine.

Simply stated, Iowa Code ch 480.4(1)(a) places the burden of ascertaining the location of underground facilities squarely on the shoulders of the excavator.

Wapello County Confidential: Soybean Shortage Valuation

Tri-County Grain Corp. v. Zimmerman, no. 08-1639 (Iowa Ct. App July 2, 2009)

Tri-County leased grain warehouse space from Zimmerman. Zimmerman informed Tri-County that its lease was not going to be renewed when it expired in September 2006. Under the lease, Zimmerman supplied all labor and was solely responsible for any shortages.

When the lease expired, Tri-County and Zimmerman orally agreed that Zimmerman would buy the remaining corn and truck the remaining soybeans at Tri-County's expense to ADM. There was no discussion about holdover rent and Zimmerman never asked for it. Zimmerman paid Tri-County for the remaining corn and hauled the beans to ADM.

There was a shortage of 10,544 bushels of beans which was not determined with precision until February 2007, when Tri-County billed Zimmerman $76,444.11 for the shortage. In July, 2007 Zimmerman asserted a claim for back rent for storage for the first time.

The fighting issue was the value of the soybeans. Tri-County said they should be valued at $7.23 a bushel, which was the price in February 2007 when the beans were delivered to ADM. Zimmerman claims the value should be $5.00 per bushel which was the price when the lease expired in September 2006. Zimmerman also counterclaimed for the use of storage bins after September 2006.

The district court determined that the beans should be valued at $5.00, entered judgment for Tri-County, and denied Zimmerman's counterclaim. This appeal followed.

The Court of Appeals cited the Uniform Commercial Code section 544.2713(1) for the proposition that the valuation for the shortage was the difference between the market price at the time when the buyer learned of the breach, and not when the exact number of bushels Tri-County was shorted became known.

Mr. Justice Mansfield dissented, saying that the majority's interpretation was not the better view of the issue. He reasons that had there been no shortfall, Tri-County would have sold the missing beans at $7.23, not at what they would sell for at an earlier date. If anyone had a duty to determine the nature and reason for the shortfall it was Zimmerman as the breaching party.