Wednesday, January 25, 2017
Court of Appeal Rules Irrigation District Is Not a ‘Municipal Corporation’
By a MetNews Staff Writer
A statute establishing the measure of damages in a suit brought by a “municipal corporation” for damage to its property does not apply to an action brought by an irrigation district, the Fifth District Court of Appeal ruled yesterday.
The panel denied the Merced Irrigation District’s petition for a writ of mandate that would have overturned a summary adjudication in favor of HART High-Voltage Apparatus Repair and Testing Co., Inc. on a cause of action under Public Utilities Code §10251.
The statute provides that the measure of damages for injury to municipal property through want of care is the cost of repair or replacement. This includes administrative and other overhead expenses that might not be recoverable in an ordinary negligence action, Justice Donald Franson Jr. noted in his opinion for the Court of Appeal.
The Merced district and Pacific Gas & Electric Co. are suing HART for damage allegedly caused when a HART employee dropped a washer into a transformer, owned by the district and the utility jointly, that HART was servicing. HART says the transformer was not physically damaged when the loose washer was dropped into it, but the district chose not to reenergize the transformer, allegedly out of concern that the transformer could be damaged if it was restarted with a loose washer inside it.
HART argues that any recovery by the district is limited to the diminution in the value of the damaged equipment. The district says the difference between the different measures could be in the millions of dollars.
Although the district and PG&E are coplaintiffs in the action, the district has assigned all of its interests in the litigation to the utility. The district received an insurance payment of more than $1 million.
In addition to the §10251 cause of action, the complaint includes claims for negligence, breach of contract, and—on behalf of PG&E only—for damage to the property of “a telegraph, telephone, electric or gas corporation” in violation of §7952.
Agreeing with the trial judge that an irrigation district is not a municipal corporation under §10251, Franson wrote:
“Nothing in the statutory text or legislative history suggests the Legislature ever considered whether to extend the benefits of section 10251 to irrigation districts. Furthermore, there are a variety of ways to describe the statutory purpose, some of which would be promoted by including irrigation districts and others which would not. In the face of this uncertainty as to purpose, we return to the statutory text. The term ‘municipal corporation’” is usually understood in its strict or proper sense. We adopt this meaning because it is the most common and, therefore, the best indicator of statutory intent.”
The case is Merced Irrigation District v. HART High-Voltage Apparatus Repair and Testing Co., Inc., 17 S.O.S. 326.
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