Title: City of Oroville v. Superior Court of Butte County
Citation: N/A
Docket Number: S243247
State: California
Issuer: California Supreme Court
Date: August 15, 2019

IN THE SUPREME COURT OF 
CALIFORNIA 
 
CITY OF OROVILLE, 
Petitioner, 
v. 
THE SUPERIOR COURT OF BUTTE COUNTY, 
Respondent; 
CALIFORNIA JOINT POWERS RISK MANAGEMENT 
AUTHORITY et al., 
Real Parties in Interest. 
 
S243247 
 
Third Appellate District 
C077181 
 
Butte County Superior Court 
152036 
 
 
August 15, 2019 
 
Justice Cuéllar authored the opinion of the Court, in which 
Chief Justice Cantil-Sakauye and Justices Chin, Corrigan, Liu, 
Kruger, and Groban concurred. 
 
1 
CITY OF OROVILLE v. SUPERIOR COURT 
S243247 
 
Opinion of the Court by Cuéllar, J. 
 
 
A dental practice suffered damage when raw sewage 
began spewing from the toilets, sinks, and drains of its building.  
The resulting damage triggered the inverse condemnation 
claim — an action to recover damages for injuries to private 
property caused by a public improvement –– at the heart of this 
case.  The dentists contend the City of Oroville (the City) is 
legally responsible for the property damage, because it was 
caused by the sewer system’s failure to function as intended.  
According to the dentists, the failure was manifest when the 
system allowed sewage to back up into their building instead of 
siphoning the waste away from their private property.  The City 
maintains the damage occurred because the dentists failed to 
install a legally-required backwater valve that would have 
prevented sewage from entering their building in the event of a 
sewer main backup.   
 
What we conclude is that the Court of Appeal erred in 
finding the City liable in inverse condemnation.  The appellate 
court reached this decision without addressing a fundamental 
question:  whether the inherent risks associated with the sewer 
system 
–– 
as 
deliberately 
designed, 
constructed, 
or 
maintained –– were the substantial cause of the damage to the 
private property.   
 
Public entities are not strictly or otherwise automatically 
liable for any conceivable damage bearing some kind of 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
2 
connection, however remote, to a public improvement.  To 
succeed on an inverse condemnation action, a plaintiff must 
ordinarily show — assuming the public entity made reasonable 
assumptions about the public improvement in question –– that 
the damage to private property was substantially caused by 
inherent risks associated with the design, construction, or 
maintenance of the public improvement.  That’s certainly not 
something the dentists were able to show in this case, where 
installation of a backwater valve on their premises not only 
would have prevented or drastically mitigated the risk of 
damage, according to experts, but was legally required.  Under 
the circumstances, the City is not liable in inverse 
condemnation, so we reverse the judgment of the Court of 
Appeal. 
I. 
 
Raw, untreated sewage from the City of Oroville’s sewer 
main backed up into a private sewer lateral in December 2009, 
invading the sinks, toilets, and drains of a local office building.  
Located at 3579 Oro Dam Boulevard, the building was owned by 
three dentists doing business as WGS Dental Complex.  The 
dentists, individually and doing business as WGS Dental 
Complex (collectively WGS), filed claims against their insurer, 
The Dentists Insurance Company (TDIC).  WGS sued the City 
for inverse condemnation (Cal. Const., art. I, § 19) and nuisance 
for losses it claimed were not covered by insurance.  And TDIC 
filed a complaint in intervention for negligence, nuisance, 
trespass, and inverse condemnation.  The City filed a cross 
complaint against WGS for its failure to ensure a backwater 
valve was properly installed on their private sewer lateral, 
alleging violation of the Oroville Municipal Code, public 
nuisance, strict liability, and negligence.   
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
3 
 
The City moved for summary judgment on WGS’s claims, 
citing WGS’s failure to install the backwater valve.  WGS 
opposed the City’s motion, asserting it had no role in 
constructing the building and was unaware of any issue with the 
backwater valve until the sewage backed up into the building 
and alleging the City’s intentional plan of maintenance of the 
sewer main allowed a blockage to form.  The trial court denied 
the City’s motion, and stated, “[I]t appears that either 
prevention of the blockage or installation of the backflow 
prevention device could have prevented the damage.  The 
relative importance of these two factors in causing the damage 
will be something for the trier of fact to decide.”   
 
WGS then sought judicial determination of the City’s 
liability for inverse condemnation under Code of Civil Procedure 
section 1260.040 (section 1260.040), deferring the issue of 
damages.1  After WGS and the City reasserted the positions 
advanced at summary judgment, the trial court took judicial 
notice of most of the documents submitted in the summary 
judgment proceedings.  On July 25, 2014, the trial court found 
the City liable in inverse condemnation.   
 
The City presented evidence that the sewer on Oro Dam 
Boulevard was built and operates as a gravity-driven system, in 
                                        
1  
In Weiss v. People ex rel. Dept. of Transportation (2018) 20 
Cal.App.5th 1156, review granted June 13, 2018, S248141, we 
granted review to address whether section 1260.040 may be 
properly used in inverse condemnation proceedings to 
determine –– in advance of a bench trial –– whether a taking or 
damaging of private property has occurred.  That question is not 
in dispute here, so we need not decide in this case whether a 
section 1260.040 motion is a proper way to seek judicial 
resolution of an inverse condemnation claim.   
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
4 
which sewage flows downhill to a sewage treatment plant.  
Manholes provide points of access to the sewer main for 
maintenance and the sewer system is designed for sewage to 
escape through the manhole immediately upstream of a sewer 
main line blockage.  WGS’s private lateral sewage line connects 
to the main sewer line between manhole numbers JJ-10 and JJ-
11.  The City found evidence of a partial blockage in the sewer 
line between manholes JJ-10 and JJ-11 on December 29, 2009, 
the date of the sewage backup into the WGS building.   
 
The City also submitted evidence that it enacted Oroville 
Ordinance No. 1450 in 1984, which adopted the 1982 Uniform 
Plumbing Code.  This ordinance required property owners to 
install backwater valves on private sewer laterals where the 
fixtures on the property are lower than the elevation of the next 
upstream manhole of the public sewer.  Backwater valves are 
installed to prevent sewage from entering buildings during 
sewer main line backups.  WGS acquired its building when it 
was under construction in 1985, after the City enacted Oroville 
Ordinance No. 1450.  In 1986, the City inspected the 
construction and issued a “Certificate of Occupancies” to the 
dentists.  At the time of the sewage backup, WGS had no 
backwater valve installed on its private sewer lateral.  
According to the City’s experts, the sewage that backed up in 
the sewer line between manholes JJ-10 and JJ-11 would have 
ordinarily spilled out of the next upstream manhole.  Instead, 
on December 29, 2009, the sewage exited through the sink and 
toilet fixtures at WGS’s offices because WGS had no backwater 
valve on its private sewer lateral.   
 
WGS offered its own expert testimony.  Its expert 
conceded that the sewage backup incident could have been 
averted if a fully functional backwater valve had been installed 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
5 
on WGS’s building.  This expert further testified that backwater 
valves don’t always work to perfection, because certain 
backwater valves can be inadvertently damaged during routine 
sewer cleaning, diminishing the valve’s capacity. 
 
After considering the evidence, the trial court found that 
WGS submitted sufficient evidence to establish the following 
facts:  there was a blockage in the City’s sewer main; the 
blockage was most likely caused by roots; the blockage resulted 
in sewage backup in WGS’s offices; and the backup caused 
damage to WGS’s property.  The trial court stated these basic 
facts were not in dispute, and the only issue for determination 
on the section 1260.040 motion was the legal responsibility for 
the damage that resulted from the sewage backup.   
 
The court then concluded that an inverse condemnation 
had occurred even though the City shared causal responsibility 
for the damage with WGS.  The “primary cause of the blockage,” 
the court found, was root intrusion in the sewer main and “a 
significant secondary cause of the damage” was WGS’s failure to 
install a backwater valve on their private sewer lateral, “a 
necessary part of the sewer design and plan.”  Citing California 
State Automobile Assn. v. City of Palo Alto (2006) 138 
Cal.App.4th 474 (City of Palo Alto), the trial court held it was 
constrained to find the City liable in inverse condemnation 
because one of the causes of damage was root blockage, which 
was described in City of Palo Alto as an inherent risk of sewer 
operation.    
 
Petitioning the Court of Appeal for a peremptory writ of 
mandate, the City presented three arguments.  First, the 
deliberate design and construction of the sewer system was not 
the cause of the damages.  Second, WGS’s failure to install and 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
6 
maintain the legally required backwater valve defeated the 
deliberate design and construction of the sewer system.  And 
third, the City claimed to have acted reasonably in operating 
and maintaining its sewer system.  
 
WGS argued that the trial court was correct in finding the 
City liable in inverse condemnation.  TDIC assigned its 
intervention rights to the California Joint Powers Risk 
Management Authority (the Authority), a risk-sharing pool 
comprised of public entities, including the City of Oroville.  
Appearing as a real party in interest, the Authority argued that 
although recovery for inverse condemnation would be in its 
financial interest in this case, it supported the City’s position 
that inverse condemnation should not be available where 
sewage overflows onto private property because the landowner 
failed to have a backwater valve as required by law.   
 
The Court of Appeal concluded that the trial court had 
correctly found the City liable in inverse condemnation.  First, 
the Court of Appeal addressed the City’s argument that the only 
reason sewage spilled into WGS’s private property was WGS’s 
failure to install and maintain a backwater valve, which 
defeated the design of the sewer system.  Relying on City of Palo 
Alto, the Court of Appeal stated that in order to absolve itself of 
liability, the City would have to prove that other forces alone 
produced the injury.  The Court of Appeal reasoned that, despite 
the City’s argument to the contrary, a distinction existed 
between concluding that the backwater valve had the capacity 
to prevent the sewage backup from entering WGS’s private 
property, and finding the absence of the backwater valve –– 
alone –– produced the injury.  The Court of Appeal rejected the 
City’s argument that the absence of the backwater valve 
assuaged or eliminated its liability, characterizing it as 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
7 
reminiscent of a “sort of contributory negligence theory from tort 
law,” in which WGS’s conduct would preclude recovery from the 
City — a concept the Court of Appeal noted was no longer 
applicable even in tort law.  Again relying on City of Palo Alto, 
the Court of Appeal concluded that even where an independent 
force 
contributes 
to 
the 
plaintiff’s 
injury, 
the 
public 
infrastructure in question is a concurrent cause if the injury 
occurred in substantial part because the improvement failed to 
function as intended.  The Court of Appeal reasoned that WGS’s 
“failure to install a backup valve did not cause the blockage in 
City’s sewer main.”   
 
Then the Court of Appeal turned to whether the sewer, as 
deliberately designed, caused damage to private property.  The 
Court of Appeal stated that the City’s sewer system was 
designed and constructed to overflow, if necessary, at the next 
upstream manhole and that the City acknowledged a sewer 
blockage was an inherent risk of the sewer system.  But the 
Court of Appeal dismissed the City’s argument that there was 
no inherent risk of backup into private property if the property 
owner installed a backwater valve, noting that if the backwater 
valve was a necessary component of the sewer design, perhaps 
the City should have ensured compliance with the law.  The 
Court of Appeal concluded that WGS’s failure to install the 
backwater valve did not defeat the inverse condemnation claims 
and affirmed the trial court’s decision.   
 
We granted review to address whether the City is liable in 
inverse condemnation where sewage backs up onto private 
property because of a blockage in the City’s sewer main and the 
absence of a backwater valve that the affected property owner 
was legally required to install and maintain. 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
8 
II. 
A. 
 
Sometimes the well-being of the public justifies the seizure 
of privately held property.  But in our system of government, 
such private property “condemnation” for public use can only 
occur subject to certain conditions.  Under article I, section 19 of 
the California Constitution (article I, section 19), a public entity 
must pay the owner just compensation when it takes or damages 
private property for public use.  (Art. I, § 19, subd. (a) [“Private 
property may be taken or damaged for a public use and only 
when just compensation . . . has first been paid to . . . the 
owner”].)  Used responsibly, the government’s capacity to 
condemn private property for public use allows for a reasonable 
compromise between the public good and the protection of 
private citizens whose property is needed to advance that good.  
(City of Oakland v. Oakland Raiders (1982) 32 Cal.3d 60, 64.)    
 
This “just compensation” clause in the California 
Constitution applies to the state’s exercise of its eminent domain 
power, constraining it by requiring that when the state takes 
private property for public use, the private property owner is 
justly compensated.  (Customer Co. v. City of Sacramento (1995) 
10 Cal.4th 368, 376-377 (Customer Co.).)  Where government 
does not recognize that a particular circumstance amounts 
functionally to a taking for public use or otherwise fails to pay 
the requisite compensation for the property in question, the 
property’s 
owner 
can, 
as 
here, 
pursue 
an 
“inverse 
condemnation” action.  (See id. at p. 377; see also Locklin v. City 
of Lafayette (1994) 7 Cal.4th 327, 362.)  So article I, section 19 
provides the basis for two kinds of actions:  a conventional 
eminent domain proceeding, instituted by a public entity to 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
9 
acquire private property for public use; and an inverse 
condemnation action, initiated by a private property owner 
seeking compensation for a taking or damage to his or her 
property.  (Customer Co., at pp. 376-377.)   
 
To resolve inverse condemnation claims and the causal 
questions they raise, courts have garnered insights from tort 
and property law doctrines relevant to analogous disputes 
between private parties.  (See Bunch v. Coachella Valley Water 
Dist. (1997) 15 Cal.4th 432, 439 (Bunch), citing Belair v. 
Riverside County Flood Control Dist. (1988) 47 Cal.3d 550, 562 
(Belair).)  Supporting this approach was an understanding that 
inverse condemnation is not a distinct cause of action, but 
instead a remedy for an already-existing cause of action.  At one 
point, courts had limited inverse condemnation only to 
circumstances where a private party would be liable to the 
property owner for the injury.  (Bunch, at p. 439; Belair, at p. 
562; Albers v. Los Angeles County (1965) 62 Cal.2d 250, 256 
(Albers).)  We subsequently clarified that ultimately, the just 
compensation clause is the “distinct constitutional source” that 
underlies a public entity’s responsibility to compensate owners 
for those damages to private property resulting from the 
construction of a public improvement.  (Holtz v. Superior Court 
(1970) 3 Cal.3d 296, 302 (Holtz).)  Common law doctrines may 
offer a useful analogy, but the roots of inverse condemnation 
liability lie in constitutional terrain rather than the common 
law.   
 
Given the constitutional roots and broad purposes 
associated with inverse condemnation claims, it is no surprise 
these can arise in a wide variety of contexts.  A “deliberate 
action” undertaken by a public entity “in furtherance of public 
purposes” –– including, of course, a public improvement such as 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
10 
a water system or a flood control levee –– can conceivably trigger 
an inverse condemnation action.  (Clement v. State Reclamation 
Board (1950) 35 Cal.2d 628, 641 (Clement).)  From underground 
excavation projects, to street construction, to the distinctive 
realm of flood control improvements, our inverse condemnation 
law covers the proverbial waterfront of public improvements.  
(See Bunch, supra, 15 Cal.4th 432; Belair, supra, 47 Cal.3d 550; 
Holtz, supra, 3 Cal.3d 296; Bacich v. Board of Control (1943) 23 
Cal.2d 343 (Bacich).)  Consistent across our assessment of these 
varied public works is the expectation that if an improvement is 
“inherently dangerous to private property,” the public entity — 
by virtue of the constitutional provision — undertakes the 
responsibility “to compensate property owners for injury to their 
property arising from the inherent dangers of the public 
improvement or originating ‘from the wrongful plan or character 
of the work.’ ”  (House v. L. A. County Flood Control Dist. (1944) 
25 Cal.2d 384, 396 (House).) 
 
What makes it a challenge to set the precise limits of a 
public entity’s responsibility in practice is that multiple 
concerns, some arguably in tension with each other, are at stake 
in the interpretation of article I, section 19.  One is to pool the 
burden to the individual property owner and distribute 
throughout the community the losses resulting from the public 
improvement.  (Bunch, supra, 15 Cal.4th at p. 440; Holtz, supra, 
3 Cal.3d at p. 303; Albers, supra, 62 Cal.2d at p. 263.)  Another 
is to mitigate concerns that “compensation allowed too liberally 
will 
seriously 
impede, 
if 
not 
stop, 
beneficial 
public 
improvements because of the greatly increased cost.”  (Bacich, 
supra, 23 Cal.2d at p. 350; see also Holtz, supra, at pp. 303-304; 
Albers, supra, 62 Cal.2d at p. 263.)  Indeed, the parties’ positions 
in this very case aptly illustrate how these concerns diverge.  
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
11 
WGS argues the City should be held liable in inverse 
condemnation, which would result in the cost of WGS’s losses 
being spread across the entire community.  The City and the 
Authority assert that the damages were caused by WGS’s failure 
to install and maintain the required backwater valve.  They 
maintain that if courts find public entities liable for damages 
resulting from private property owners’ unlawful acts or failures 
to act, such entities will be discouraged from providing essential 
public works projects. 
 
In advancing these competing positions, the parties focus 
on different aspects of the inverse condemnation analysis, each 
emphasizing a distinct concept drawn from our case law.  We 
have previously held that “any actual physical injury to real 
property proximately caused by [a public] improvement as 
deliberately designed and constructed is compensable under 
[the California Constitution] whether foreseeable or not.”  
(Albers, supra, 62 Cal.2d at pp. 263-264.)2  We later recognized 
the potential confusion presented in Albers by our use of the 
term “proximate cause” — which in tort law is often defined 
largely in terms of foreseeability — in a case where the damage 
was not foreseeable, yet we still imposed inverse condemnation 
                                        
2  
The two exceptions to the “strict liability rule” recognized 
in Albers were circumstances where the urgency or importance 
of the government conduct was so overriding that public policy 
advised against holding the government liable in inverse 
condemnation absent fault.  (Holtz, supra, 3 Cal.3d at pp. 304-
305; Bunch, supra, 15 Cal.4th at pp. 440-441.)  The first 
addressed damages inflicted in the proper exercise of the 
government’s police power; the second “occurred in the ‘unique’ 
context of water law.”  (Bunch, at p. 441, citing Archer v. City of 
Los Angeles (1941) 19 Cal.2d 19, 24-25.)  
 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
12 
liability.  (Holtz, supra, 3 Cal.3d 296, 304, fn. 9.)  To mitigate 
confusion, we restated this test to eschew the term “proximate.”  
What we used instead was the term “ ‘ “substantial” causation.’ ”  
(Belair, supra, 47 Cal.3d at p. 559, quoting Holtz, supra, 3 Cal.3d 
at p. 304, fn. 9.)   
 
Applying this concept of “substantial causation,” we have 
explained in our inverse condemnation decisions that private 
landowners may establish inverse condemnation liability even 
where the public improvement as deliberately designed, 
constructed, and maintained was only one of several concurrent 
causes –– provided the causal nexus between the risks inherent 
in the public improvement and the harm in question was 
sufficiently robust to create a pronounced likelihood of damage.  
(Customer Co., supra, 10 Cal.4th at p. 382 [“ ‘[t]he destruction 
or damaging of property is sufficiently connected with “public 
use” as required by the Constitution, if the injury is a result of 
dangers inherent in the construction of the public improvement 
as distinguished from dangers arising from the negligent 
operation of the improvement’ ” (quoting House, supra, 25 Cal.2d 
at p. 396 (conc. opn. of Traynor, J.))]; Youngblood v. Los Angeles 
County Flood Control Dist. (1961) 56 Cal.2d 603, 610 
(Youngblood) [requiring a showing that the improvement “as 
planned and installed by defendant, would necessarily or 
probably” cause the property damage].)  What these decisions 
reflect is our concern not only with the deliberate design, 
construction, or maintenance of a public improvement, but also 
the nature of the causal relationship between the public work 
and the damages to private property.   
 
The City and the Authority argue that the Court of Appeal 
simply assumed that a blockage in the sewer main caused 
WGS’s property damage without addressing whether the 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
13 
damages were caused by the inherent risks posed by the design, 
construction, or maintenance of the sewer system or by WGS’s 
failure to install and maintain the legally required backwater 
valve.  And they assert that the sewer system design required 
WGS, like all users of the sewer system, to comply with the 
Uniform Plumbing Code and local ordinances and its failure to 
do so prevented the system from functioning as deliberately 
designed.  Because the Court of Appeal did not address whether 
the extent of the causal contribution of inherent risks associated 
with the sewer system’s design (or, for that matter, its 
construction or maintenance) is sufficiently “substantial” to 
warrant inverse condemnation liability, the City posits that 
finding it liable under the circumstances would effectively 
saddle it with “strict liability,” irrespective of the nature of 
inherent risks posed by the sewer system as deliberately 
designed, constructed, and maintained.  Whether or not one 
understands WGS’s argument as essentially a call for 
imposition of strict liability, the heart of this dispute indeed 
concerns the analysis a reviewing court must undertake to 
resolve an inverse condemnation claim. 
 
In contrast, WGS contends the City is liable for the 
resulting damages from the sewer backup.  According to WGS, 
a public improvement need only be a concurrent cause of 
damage in order for inverse condemnation liability to 
attach — so it is irrelevant to the inverse condemnation analysis 
whether WGS failed to install the required backwater valve.  
Although the trial court found that WGS’s failure to install and 
maintain that valve was “a significant secondary cause” of the 
damage (emphasis added), what matters most for WGS is that 
the trial court found blockage in the sewer main to be a 
concurrent cause of the damage.   
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
14 
B. 
 
Our conclusion follows from what we explained in 
Customer Co. and Holtz:  a court assessing inverse 
condemnation liability must find more than just a causal 
connection between the public improvement and the damage to 
private property.  What we hold is that the damage to private 
property must be substantially caused by an inherent risk 
presented 
by 
the 
deliberate 
design, 
construction, 
or 
maintenance of the public improvement.  This approach aligns 
with how we have previously analyzed inverse condemnation 
liability cases.  It also protects private property owners by 
allocating the financial losses resulting from the public 
improvement across the community and provides public entities 
with an incentive to internalize the reasonable risks of their 
public improvements.   
 
The concepts of “inherent risk” and “substantial 
causation” address somewhat overlapping considerations but 
play distinct roles in the analysis of inverse condemnation.  And 
both must be present for a public entity to be liable.  We have 
explained that a public entity’s construction of a public 
improvement is a deliberate action made “in furtherance of 
public purposes.”  (Clement, supra, 35 Cal.2d at p. 641.)  If 
damage to private property is substantially caused by the 
inherent risks of the design or construction of a public 
improvement, a public entity must provide just compensation 
for the damage, whether it was intentional or the result of 
negligence by the public entity.  (Ibid.; Bauer v. Ventura County 
(1955) 45 Cal.2d 276, 284.)   
 
The inherent risk assessment requires a reviewing court 
to consider whether the inherent dangers of the public 
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Opinion of the Court by Cuéllar, J. 
 
15 
improvement 
as 
deliberately 
designed, 
constructed, 
or 
maintained materialized and were the cause of the property 
damage.  (Pacific Bell v. City of San Diego (2000) 81 Cal.App.4th 
596, 607 (Pacific Bell), citing House, supra, 25 Cal.2d at p. 396.)  
This inquiry operates as a preventive measure to ensure that 
not all private property damage bearing some causal 
relationship to a public improvement results in liability.  
Rather, the injury to property must arise from the inherent 
dangers of the public improvement as deliberately designed, 
constructed, or maintained.  (House, 25 Cal.2d at p. 396.)  The 
inherent risk assessment — in line with the policy 
considerations underlying article I, section 19 — avoids open-
ended liability by protecting public entities from liability for 
private property damage that is arguably connected to a public 
improvement but is not the result of the improvement’s inherent 
risks.  (Belair, supra, 47 Cal.3d at p. 558.)        
 
Such risks may arise, for example, from a public entity’s 
adoption of a comparatively lower cost plan to create the public 
improvement.  Faced with a panoply of other legitimate needs 
ranging from critter control to health care, a public entity might 
decide against expending additional funds or employing more 
protective measures in the construction of a project, even though 
the construction plan as adopted poses certain risks of damage 
to private property and the additional expenditures or 
protections could likely prevent that risk of damage.  (See Holtz, 
supra, 3 Cal.3d at p. 310.)  The public entity may reach its 
decision because the likelihood of damage is remote, but the 
expense of additional protection is great.  (Ibid.)  Where the 
undertaking of the project at the lower cost creates “some risk, 
however slight, of damage to plaintiffs’ property, it is proper to 
require the public entity to bear the loss when damage does 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
16 
occur.”  (Id. at pp. 310-311.)  In those circumstances, private 
property owners should be compensated for the damage to their 
property resulting from the inherent risks posed by the public 
improvement as reasonably undertaken at the lower cost 
because the public entity “ ‘is in a better position to evaluate the 
nature and extent of the risks of public improvement than are 
potentially affected property owners.’ ”  (Id. at p. 311, quoting 
Van Alstyne, Inverse Condemnation:  Unintended Physical 
Damage (1969) 20 Hastings L.J. 431, 495 (Van Alstyne).)   
 
Although evidence could conceivably arise to the contrary 
that might trigger further scrutiny, we presume the public 
entity acted reasonably in reaching its decision to adopt a 
particular plan of design, construction, or maintenance.  (See 
Pacific Bell, supra, 81 Cal.App.4th at p. 608 [reasoning the city’s 
decision to install a system without monitoring capability may 
have been reasonable because the costs of monitoring may have 
outweighed the benefits].)  This presumption acknowledges that 
we expect public agencies — as the public “locus of 
responsibility” for balancing efficiencies and costs — to proceed 
sensibly in the decision making process and avoid patently 
unreasonable 
assumptions 
in 
the 
planning 
of 
public 
improvements.  (See Holtz, 3 Cal.3d at p. 311.)  Yet it is 
consistent with protection of property owners, too:  where 
damages are the direct consequence of the inherent risks posed 
by the public improvement, responsibility for the individual 
property owner’s loss is spread across the community benefiting 
from the public work.  (See Bunch, supra, 15 Cal.4th at p. 440.)    
 
But useful public improvements must eventually be 
maintained and not merely designed and built.  So the “inherent 
risk” aspect of the inverse condemnation inquiry is not limited 
to deliberate design or construction of the public improvement.  
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
17 
It also encompasses risks from the maintenance or continued 
upkeep of the public work.  (See Bauer, supra, 45 Cal.2d at p. 
285.)  A public entity might construct a public improvement and 
then entirely neglect any kind of preventive monitoring or 
maintenance for the improvement.  (See Pacific Bell, supra, 81 
Cal.App.4th at pp. 599-600.)  If the public entity makes a policy 
choice to benefit from the cost savings from declining to pursue 
a reasonable maintenance program, for instance, inverse 
condemnation principles command “the corollary obligation to 
pay for the damages caused when the risks attending these cost-
saving measures materialize.”  (Id. at p. 608.)  It may be sensible 
in some sense for a public entity to forgo regular monitoring and 
repair and instead adopt a “wait until it breaks” plan of 
maintenance to save on the costs of imposing a monitoring 
system.  But the damages that result from the inherent risks 
posed by the public entity’s maintenance plan should be spread 
to the community that benefits from lower costs, instead of 
leaving property owners adversely affected by the public entity’s 
choice to shoulder the burden alone.  (Ibid.)     
 
A link to one of the aforementioned “inherent risks” is 
necessary, but not sufficient, for a successful inverse 
condemnation claim.  The plaintiff must also establish 
substantial causation.  Together, our inverse condemnation 
decisions offer a relatively clear picture of the causal 
relationship that must be shown for a claim to succeed.  Liability 
depends on whether some element of physical, but-for causation 
is present to link the public improvement and the damage.  The 
damage must be the “ ‘necessary or probable result’ of the 
improvement, or if ‘the immediate, direct, and necessary effect’ 
thereof was to produce the damage.”  (Van Alstyne, supra, 20 
Hastings L.J at p. 436, fn. omitted, italics added.)  Rather than 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
18 
training attention on the mere presence of causation, our cases 
have focused instead on whether there is proof that the damages 
“followed in the normal course of subsequent events” and were 
“predominantly” produced by the improvement.  (Ibid., citing 
Youngblood, supra, 56 Cal.2d 603; Los Angeles C. Assn. v. Los 
Angeles (1894) 103 Cal. 461, 470.)   
 
At the core of the test is the requirement that –– even in 
the case of multiple concurrent causes –– the injury to private 
property is an “inescapable or unavoidable consequence” of the 
public improvement as planned and constructed.  (Van 
Alstyne, at p. 437, fn. 32.)  As in the somewhat analogous tort 
law context, this test permits courts to consider a plaintiff’s act 
or omission in the chain of causation, for example, a property 
owner’s own failure to follow reasonable requirements imposed 
by the public entity to reduce the risk to the public 
improvement.  (See Rest.2d Torts, § 442; see also Van Alstyne, 
at p. 437.)  Accordingly, the substantial causation element of the 
analysis ensures liability is imposed only in instances where 
there is a sufficiently meaningful causal relationship between 
the damage to private property and the inherent risks posed by 
the 
public 
improvement 
as 
designed, 
constructed, 
or 
maintained. 
 
This 
approach 
avoids 
treating 
inverse 
condemnation as a species of strict or “ ‘absolute liability’ ” that 
would avoid the necessary analysis of inherent risks and 
substantial causation, frustrating the development of public 
improvements because of the increased costs to public entities.  
(Holtz, supra, 3 Cal.3d at p. 304.)      
 
To prevail on its claim of inverse condemnation liability, 
then, WGS must succeed under the correct legal analysis.  It 
must demonstrate that the inherent risks posed by the sewer 
system as deliberately designed, constructed, or maintained 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
19 
manifested and were a substantial cause of its property damage.  
WGS contends that an inherent risk of a sewer system is 
blockage caused by roots or foreign objects in the sewer main.  
Citing our opinion in Belair, WGS posits that the sewer system 
failed to function as intended because of the blockage, and the 
City should be held liable as the public improvement is 
connected in some manner to the damage to private property.  
Inverse condemnation liability, under WGS’s theory, attaches 
irrespective of whether the property damage could have been 
mitigated or extinguished if the affected property owner had 
installed the legally-required backwater valve.   
 
Yet WGS misinterprets our precedent.  Belair addressed 
the unique problems of flood control litigation –– arising in a 
distinctive context that bears only a limited relationship to our 
analysis of public improvements in other contexts –– through an 
inverse condemnation claim related to levees that failed to 
protect an area historically subject to flooding.  (Belair, supra, 
47 Cal.3d at pp. 555-557, 560.)  We concluded that despite heavy 
rainstorms contributing to the flooding, the levee was still a 
substantial concurring cause of the damages because “the 
improvement failed to function as it was intended.”  (Id. at p. 
560.)  This “failed to function as intended” concept was relevant 
in Belair only to eliminate natural flooding as a cause of the 
damage.  (Id. at pp. 561-562.)  Contrary to WGS’s contention, 
Belair did not announce a rule triggering liability in all inverse 
condemnation cases based solely on the existence of any 
conceivable causal connection between a public improvement 
and private property damage.  WGS also relies on City of Palo 
Alto, which applied Belair’s “failed to function as intended” 
phrase in a sewage backup case.  (City of Palo Alto, supra, 138 
Cal.App.4th at pp. 476-477, 483.)  Citing Belair, the City of Palo 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
20 
Alto court concluded that the purpose of the sewer was to carry 
wastewater away from the residence.  The sewer failed to carry 
the wastewater away because of a blockage in the sewer main, 
so it “failed to function as intended” and the city should be liable 
in inverse condemnation.  (Id. at p. 483.)  WGS adopts this 
argument, asserting that the City’s sewer “failed to function as 
intended” because it did not carry the sewage away from the 
private property.   
 
If we adopted the reasoning from City of Palo Alto, as WGS 
urges, we would overlook a crucial aspect of the inverse 
condemnation inquiry.  Indeed, under WGS’s analysis, liability 
for the public entity would attach whenever a public 
improvement is a concurrent cause of damage to private 
property, regardless of whether private property owners acted 
to defeat the deliberate design or construction of the 
improvement.  The principles underlying article I, section 19 cut 
against this conclusion.  (Bacich, supra, 23 Cal.2d at p. 350 
[citing concerns that “compensation allowed too liberally will 
seriously impede, if not stop, beneficial public improvements 
because of the greatly increased cost”].)  Instead, a court 
reviewing an inverse condemnation claim arising from sewage 
overflow must consider whether the damages to private 
property were the direct and necessary effect of the inherent 
risks posed by the public improvement as deliberately designed, 
constructed, or maintained.  And in a case like this, a reviewing 
court must also assess whether the damages were the result of 
a risk created not by the public improvement, but by the acts of 
the private property owner.  A causal connection between the 
public improvement and the property damage alone is 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
21 
insufficient to sustain a finding of inverse condemnation 
liability.3  
III. 
 
The Court of Appeal cited cases clarifying that inverse 
condemnation liability arises where a public improvement, as 
designed and constructed, presents an inherent risk of damage 
that materializes and causes damage to private property.  It did 
not analyze whether the City’s decision to implement a gravity 
flow sewer system that relied in part on property owners 
installing and maintaining backwater valves as required by law 
constituted an inherent risk arising from the design, 
construction, or maintenance of the public improvement, and if 
so, whether WGS’s damage was substantially caused by that 
inherent risk.  What the Court of Appeal concluded instead is 
this:  to prevail, the City must prove that other forces, with no 
connection to the design, construction, or maintenance of the 
sewer, alone produced the injury.  The Court of Appeal also 
rejected the City’s argument that WGS’s failure to install and 
maintain the legally required backwater valve was a sufficiently 
significant intervening cause that superseded the improvement 
in the chain of causation.  By failing to analyze inverse 
condemnation with sufficient focus on substantial causation by 
inherent risks associated with the public improvement, and 
presuming that the City must disprove any causal connection to 
the harm, the Court of Appeal erred.   
                                        
3 
To the extent it conflicts with this holding, we disapprove 
California State Automobile Assn. v. City of Palo Alto, supra, 138 
Cal.App.4th 474.  To the extent it adopts the “failed to function 
as intended” concept from Belair into the sewage overflow 
context, we also disapprove.    
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
22 
 
At no point in these proceedings has WGS shown the 
damage to its property was substantially caused by an inherent 
risk of the City’s sewer system, as deliberately designed, 
constructed, or maintained –– nor has it given us any rationale 
to doubt that the City made reasonable assumptions in reaching 
its decision for the design, construction, or maintenance of the 
sewer system.  In fact, the record supports that the City acted 
reasonably in adopting the design for the sewer system, and that 
the sewer was designed in accordance with the accepted 
practices for designing and constructing sewer systems of that 
time.  The trial court had before it evidence that at the time of 
the sewage backup, there was no backwater valve installed on 
WGS’s private sewer lateral and if a fully functional backwater 
valve or backflow prevention device had been installed on WGS’s 
sewer lateral, as required by law, the sewage backup incident 
could have been averted.  Consider what it means to ignore the 
missing backwater valve in this case.  We’d be airbrushing out 
of the picture not only the City’s considered judgment about 
what it would take to balance safety and practical 
considerations for this public improvement, but WGS’s 
noncompliance with an ordinary planning code requirement 
that would have eliminated or at least mitigated risks of sewage 
backup damage.  That is hardly different from turning inverse 
condemnation into a basis for automatic imposition of liability 
on the public entity if even a tenuous causal connection exists 
between the public improvement and private property damage, 
irrespective of whether a plaintiff’s act or omission materially 
contributes to the risk.  And it ignores that the City, like all 
public entities in an imperfect world of scarce resources, is in 
the business of weighing safety, the availability of resources, 
and possible risks that may result from its public improvements. 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
23 
 
So we cannot conclude that the invasion of raw sewage 
into WGS’s private property was an inherent risk of the sewer 
system as deliberately designed and constructed.  Nor can we 
conclude that the backup of sewage into WGS’s offices was the 
necessary or probable result of the sewer system’s operations.  
And the City did not act unreasonably in expecting private 
property owners to comply with the law.  This finding is 
consistent with the policy considerations underlying article I, 
section 19, because WGS, if uncompensated, will not contribute 
more than its proper share to the public undertaking.  The 
damage to its property could have been averted had WGS 
installed the backwater valve, and so the loss suffered by WGS 
should not be distributed throughout the community.  We find 
the City is not liable in inverse condemnation for the damage to 
WGS’s private property.       
IV. 
 
When public improvements damage private property, 
property owners not compensated earlier may seek recovery 
through inverse condemnation claims.  But to succeed, such 
claims 
must 
demonstrate 
more 
than 
just 
a 
causal 
link — however tenuous — between the existence of the public 
improvement and the property damage.  Instead, inverse 
condemnation liability depends on whether the property 
damage was the probable result or necessary effect of an 
inherent risk associated with the design, construction, or 
maintenance of the relevant public improvement.  
 
The damage to WGS’s property arguably bears some 
connection to the design, operation, and maintenance of the 
sewer system:  the sewage passed through the system before 
emerging in the dentist’s office, and it was perhaps possible in 
CITY OF OROVILLE v. SUPERIOR COURT 
Opinion of the Court by Cuéllar, J. 
 
24 
principle to design a sewage system that made backwater valves 
entirely redundant.  Yet we cannot say the damage was 
substantially caused by that system when WGS failed to fulfill 
a responsibility to install a backwater valve, and that 
reasonable requirement would have prevented or substantially 
diminished the risk of the mishap that spawned this case.  The 
backup of sewage into WGS’s offices was not the necessary 
result or unavoidable consequence of any risk posed by the 
sewer system.  And the City acted reasonably in adopting the 
sewer design and presuming private property owners would 
comply with the law by installing and maintaining backwater 
valve devices to prevent sewage backups into private property.  
The City is not liable in inverse condemnation.  We reverse the 
judgment of the Court of Appeal and vacate its order denying 
the petition for writ of mandate and direct the Court of Appeal 
to remand this case to the superior court for further proceedings 
consistent with this opinion. 
 
CUÉLLAR, J. 
 
  
We Concur: 
CANTIL-SAKAUYE, C. J. 
CHIN, J. 
CORRIGAN, J. 
LIU, J. 
KRUGER, J. 
GROBAN, J.
 
 
See next page for addresses and telephone numbers for counsel who argued in Supreme Court. 
 
Name of Opinion City of Oroville v. Superior Court 
__________________________________________________________________________________ 
 
Unpublished Opinion XXX NP opn. filed 6/13/17 – 3d Dist. 
Original Appeal 
Original Proceeding 
Review Granted 
Rehearing Granted 
 
__________________________________________________________________________________ 
 
Opinion No. S243247 
Date Filed: August 15, 2019 
__________________________________________________________________________________ 
 
Court: Superior 
County: Butte 
Judge: Sandra L. McClean 
 
__________________________________________________________________________________ 
 
Counsel: 
 
Peters, Habib, McKenna & Juhl-Rhodes, Mark A. Habib, Lia M. Juhl-Rhodes; Colantuono, Highsmith & 
Whatley, Michael G. Colantuono, Jennifer L. Pancake; Cota Cole & Huber, Cole Huber and Scott E. Huber 
for Petitioner. 
 
Michael N. Feuer, City Attorney (Los Angeles), Blithe Smith Bock and Timothy McWilliams, Assistant 
City Attorneys, for League of California Cities, California Joint Powers Insurance Authority, Public Entity 
Risk Management Authority, California Special Districts Association, California Association of Joint 
Powers Authorities and California Sanitation Risk Management Authority as Amici Curiae on behalf of 
Petitioner. 
 
No appearance for Respondent Superior Court. 
 
Gibbons & Conley, A. Byrne Conley and Peter A. Urhausen for Real Party Interest California Joint Powers 
Risk Management Authority. 
 
Berding Weil, Jordan M. Rojas and James O. Devereaux for Real Parties in Interest Timothy G. Wall, Sims 
W. Lowry and William A. Gilbert. 
 
Meyers, Nave, Riback Silver & Wilson, John Bakker and Kenton L. Alm for California Association of 
Sanitation Agencies as Amicus Curiae on behalf of Petitioner and Real Party in Interest. 
 
 
 
 
 
 
 
 
 
 
 
Counsel who argued in Supreme Court (not intended for publication with opinion): 
 
Michael G. Colantuono 
Colantuono, Highsmith & Whatley 
420 Sierra College Drive, Suite 140 
Grass Valley, CA  95945 
(530) 432-7357 
 
Peter A. Urhausen 
Gibbons & Conley 
Hookston Square 
3480 Buskirk Avenue, Suite 200 
Pleasant Hill, CA  94523 
(925) 932-3600 
 
James O. Devereaux 
Berding Weil 
2175 North California Boulevard, Suite 500 
Walnut Creek, CA  94596 
(925) 838-2090