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PNC Bank, N.A. v. United States Army Corps of Engineers

United States District Court, N.D. Indiana, Hammond Division

March 29, 2018

PNC Bank National Association, Plaintiff,
United States Army Corps of Engineers, et al., Defendants.



         Plaintiff PNC Bank, N.A. (f/k/a National City Bank, Successor Trustee of Trust #972 dated March 1, 1960) sued U.S. Army Corps of Engineers, Calumet River Basin Development Commission, Walsh Construction Company, and Austgen Equipment for damages arising out of the removal of its water drain pipe. According to the complaint, Walsh or Austgen, or both, were directly involved in the removal of the drain pipe as part of building a flood control levy on Plaintiff's land but the removal itself was designed by the Corps. Since then, Plaintiff's commercial property has experienced flooding during rainfalls. Plaintiff warned the defendants about the pipe and possible consequences if it were removed, but to no avail. In addition, although Plaintiff has repeatedly asked the Corps to replace the drain pipe and has even offered to do that itself, the Corps has refused to mitigate Plaintiff's situation. Hence this lawsuit. Plaintiff maintains that the removal of the pipe was unauthorized and violated federal and Indiana laws.

         The Corps moved for judgment on the pleadings, which is reviewed under the same legal standard as motions to dismiss under Rule 12(b)(6). In other words, the question is whether Plaintiff's complaint is supported by allegations that, if taken as true, would plausibly suggest that Plaintiff is entitled to relief. See Bell Atlantic v. Twombley, 550 U.S. 544, 555--56 (2007).

         While the United States is generally immune from suit, the Federal Tort Claims Act (“FTCA”) allows limited actions against the government. In this case, those limits doom Plaintiff's suit against the Corps. Thus, even if the Corps wrongfully removed the drain pipe and is now acting irrationally (as Plaintiff insists) by prohibiting Plaintiff from restoring the drainage on its property, Plaintiff cannot prevail against the Corps.


         The Corps is a federal agency that plans and carries out public works projects including those relating to flood control of the nation's rivers and waterways. 33 U.S.C. §§ 540, 701a-1, 701b. In 1976, Congress authorized the Corps to perform “advanced engineering and design” for a flood control improvement project along the Little Calumet River, pursuant to Section 101 of the Water Resources Development Act of 1976, Pub. L. No. 94-587, 90 Stat. 2917, 2918 (Oct. 22, 1976). Ten years later, in 1986, Congress authorized the Corps to implement the project according to the agency's design plan, known as the Little Calumet River, Indiana Local Flood Protection and Recreation Project (the “Flood Control Project”), pursuant to Section 401 of the Water Resources Development Act of 1986. Pub. L. No. 99-662, 100 Stat. 4082, 4111, 4115 (Nov. 17, 1986). The Indiana General Assembly established the Commission to serve as the local sponsor for the Flood Control Project, as required by federal law, and to obtain “lands, easements, and rights-of-way” necessary to perform construction, operation and maintenance of the project on private property. Ind. Code. § 14-13-2, et seq.; Pub. L. No. 99-662, 100 Stat. at 4083.

         Plaintiff (the Trust) is the owner of land adjacent to the north bank of the Little Calumet River, in Hammond, Indiana. (Compl. ¶ 7.) In April 2008, the Commission paid the Trust $299, 000 in exchange for a Flood Protection Levee Easement (the “Permanent Easement”) and a Temporary Work Area Easement (the “Temporary Work Easement”) across a portion of Plaintiff's property. (Id. ¶ 26; Ex. 1.)

         The Permanent Easement grants the Commission a “perpetual and assignable right and easement” in Plaintiff's property “to construct, maintain, repair, operate, patrol and replace a flood protection levee” in accordance with the Project. (Df.'s Ex. 1 at 6.) The Temporary Work Easement granted the United States and its contractors a temporary construction easement, for a period until six months after construction was completed, to use the land within the boundaries of the easement as a work area, including:

[T]he right to move, store and remove equipment and supplies, and erect and remove temporary structures on the land and to perform any other work necessary and incident to the construction of [the Flood Control Project], together with the right to trim, cut, fell and remove therefrom all trees, underbrush, obstructions, and any other vegetation, structures, or obstacles within the limits of the right-of-way.

(Df.'s Ex, 1 at 7.)

         Between May and October 2010, Walsh and Austgen performed work for the Project on Plaintiff's property pursuant to the Permanent and Temporary Work Easements. (Compl. ¶ 27.) Beginning in July 2010, Walsh and/or Austgen used heavy equipment to excavate a six-foot deep trench across the length of the easement for the purpose of installing a below-grade sheet pile wall. (Id. ¶ 28.) During the excavation of the trench, Plaintiff informed defendants that continued excavation of the trench would cause damage to a four-inch plastic drain pipe located about four feet below ground that intersected with the path of the levee easement. (Id. ¶¶ 3, 30.) Plaintiff also informed defendants that removal of the drain pipe would cause greater risk of flooding and damage to its property and structures. (Id. ¶¶ 4, 31.) According to the Trust, the Commission, Walsh's superintendent and/or Austgen promised to avoid destruction of the drain pipe at least until Plaintiff has an opportunity to seek redress in court. (Id. ¶ 32.) Nevertheless, Walsh and Austgen proceeded with the trench excavation and removed the intersecting portion of the drain pipe. (Id. ¶¶ 5, 33.) Plaintiff alleges that the Corps directed the contractors to remove the drain pipe or failed to instruct them to avoid its destruction. (Id.)


         Plaintiff's claims must be dismissed against the Corps because they are barred by the FTCA's discretionary function exception and the Flood Control Act.

         The discretionary function exception to the FTCA's waiver of sovereign immunity bars “[a]ny claim . . . based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the Government, whether or not the discretion involved be abused.” 28 U.S.C. § 2860(a). The purpose of the exception is “to prevent judicial second-guessing of legislative and administrative decisions grounded in social, ...

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