Today’s posting has nothing to do with corporate law and everything to do with trees.  On November 30 and December 1, 2011, the City of Pasadena experienced an unusually violent windstorm.  Wind speeds in excess of 100 miles per hour were recorded within the city, toppling over 5,000 municipally owned trees.  See Pasadena Tree Failure Analysis (July 2012).  One of these trees fell on the home of James O’Halloran.  Fortunately, the homeowner was insured and he received $293,000 in compensation for his loss.  His insurance company then sued the city for inverse condemnation and nuisance.

But why would the insurer sue for inverse condemnation if the city didn’t take Mr. O’Halloran’s house?  It turns out that Article I, Section 19 of the California Constitution provides that private property “may be taken or damaged for a public use and only when just compensation . . . has first been paid to the . . . owner”.  In City of Pasadena v. Superior Court, 2014 Cal. App. LEXIS 733 (Aug. 14, 2014), the Court of Appeal found that an inverse condemnation claim requires (1) a deliberate action by the state; and (2) a furtherance of a public purpose.

The Court of Appeal found evidence demonstrating that both of these elements were met.  First, the Court found that the tree was a “street tree” that was part of the city’s program to enhance residents’ and visitors’ quality of life.  I don’t think that the Court was casting any aspersions on the tree just because it was living on the streets.  In fact, homelessness in the case of trees may be a positive virtue.  Second, the Court found that trees served the public purpose of improving public roads. Thus, the Court found that the trial court properly denied summary adjudication for the city.