Opinion ID: 889691
Heading Depth: 2
Heading Rank: 1

Heading: Sunburst.

Text: ¶ 17 Montana formerly followed the presumption that diminution in market value constituted the appropriate measure of damages for injury to property. Burk Ranches, Inc., v. State, 242 Mont. 300, 790 P.2d 443 (1990). The Court always had recognized, however, that no single measure of damages can serve in every case to compensate adequately an injured party. Burk Ranches, 242 Mont. at 305, 790 P.2d at 445. Our decision in Sunburst officially rejected any one-size-fits-all approach to property damages. A review of the circumstances giving rise to the decision in Sunburst to broaden the available remedies in property damages cases provides helpful guidance in resolving Lampi's claim. ¶ 18 Texaco Inc. (Texaco) operated a gasoline refinery just outside of the town of Sunburst, Montana. The refinery leaked gasoline that contaminated the groundwater and soil in the town of Sunburst. Sunburst, ¶ 10. Sunburst residents sought $30 million in damages to restore the property to its pretort condition. Texaco objected to an award of restoration damages on the grounds that the cost of remediating the contamination greatly exceeded the market value of the property. The contaminated property had an aggregate market value of approximately $2 million. Id. at ¶ 49. The contamination essentially rendered the property valueless. ¶ 19 The district court instructed the jury to award all costs that reasonably would be necessary to restore the plaintiffs' property to the condition it would have been absent Texaco's contamination. Id. at ¶ 23. The jury awarded $15 million in restoration damages. Id. at ¶ 25. Texaco appealed the award on the grounds that restoration damages never can exceed a property's market value. Id. at ¶ 29. ¶ 20 The Court upheld the jury's award of restoration damages. Little incentive would exist for tortfeasors to prevent or remediate contamination, especially in parts of Montana where property values are relatively low, if restoration damages could not exceed a property's market value. Id. at ¶ 46. The Court reasoned that limiting Texaco's remediation costs to the pre-tort value of the contaminated property essentially would have provided Texaco with a private right of inverse condemnation. Id. We concluded that statutory and common laws, such as environmental laws can compel repair or restoration costs in excess of the diminution in market value. Id. at ¶ 31. The Court adopted the restoration damages rule from Restatement (Second) of Torts § 929 (1979). Sunburst, ¶ 36.