Janzen Schroeder Ag Law Wins Nearly $500,000 Trial Verdict for Indiana Farmers

On May 18, 2021, the Marshall County Circuit Court granted judgment in favor of the Houin family (our clients) and against the Indiana Department of Natural Resources (“DNR”). The verdict followed a three-day trial in January 2021 and extensive post-trial briefing. Following is a recap of this case and key take aways for the modern farmer.

The Houin family raises row crops in Marshall County, Indiana. A portion of the Houins’ farmland surrounds the Lake of the Woods, a small recreational lake surrounded by seasonal lake homes. In 1986, the Marshall Circuit Court issued an order establishing a summer average level for the lake—effective May 15 through September 15 each year. The lake water level is regulated by a control structure (dam) at the lake’s downstream outlet. Historically, the farmers and the lake residents worked together to regulate the water level in accordance with the Court-ordered legal average.

However, in about 2005, the Indiana DNR took over operation of the dam. The DNR did not operate the control structure in a way that maintained the legal average during the summer months. It ignored local weather conditions and left the control structure closed longer that it would have been under earlier protocol. This change led to higher average summer water levels in the lake and flooded the Houins’ farm fields. In 2015, the DNR acknowledged that it had been operating the dam in a manner that failed to meet “the spirit of the Marshall County Circuit Court’s order for maintaining the lake level.” The DNR explained that the new operating mandate was based upon, what it called, just an “innocent keystroke error.”

The Houins filed suit in 2017 and sought damages for crop loss and damaged field tile that had silted shut after multiple, standing water flooding events. After years of litigation, the matter went to trial in January 2021. At trial, an environmental expert explained the hydrologic connection between the field tiles and the lake level. The Houins explained that their high-tech field equipment precisely measured crop damages caused by high water levels when compared to nearby similar non-impacted fields. An expert accountant confirmed the Houins’ crop yield damages were reasonable estimates. 

The Court rejected the DNR’s argument that it should not be liable since the Houins had purchased crop insurance. A farmer’s attempt to mitigate risk does not insulate the DNR from its own negligence.

The Court also rejected the DNR’s water is a “common enemy” argument. The common enemy defense is only available to landowners and only applies to surface waters. 

The Court further rejected the DNR’s argument that the Houins were contributorily negligent for continuing to farm the affected fields. The Houins were right to assume the DNR would operate the dam in accordance with the 1986 Court Order.

The Marshall Circuit Court found in favor of the Houins on their negligence, nuisance, and inverse condemnation claims and awarded damages in the amount of $485,644.00. By assuming control of the dam, the DNR incurred a duty to operate the dam in compliance with the 1986 Court Order. The DNR’s failure to comply with the Order breached its duty, causing crop loss and field tile damages. The Houins took reasonable measures to mitigate any potential damages. The Court concluded the DNR’s actions created a nuisance and the temporary flooding of the cropland constituted a “taking” under the Constitution. 

The Houins’ case presents several key take-aways for the modern farmer. First, the DNR was found liable for its negligent management of the dam which led to crop damages on surrounding fields. Second, third-party crop insurance does not insulate the DNR from liability for its own actions. Lastly, precision technology can be a powerful tool for proving the existence and extent of crop damages and pinpoint the root causes. 

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Read the entire decision here: Marshall Circuit Court Judgment. The case is currently pending appeal.