The Paycheck the 1927 Levee Promise Left Out

In the spring of 1927, Louisiana dynamited a levee below New Orleans and promised to pay for the damage. Two and a half years later, the state's highest court decided what "damage" meant.

The Louisiana Supreme Court never wrote down his first name, but it was careful to write down his salary. He lived in New Orleans and managed the St. Bernard Motor Company, which did its business in St. Bernard Parish, a stretch of marsh and fishing towns the State of Louisiana flooded on purpose in 1927. He made $75 a week. He figured the company wouldn't reopen until December, thirty-five weeks off, and he rounded that to eight months. Multiply it out and you get $2,625.

All of that is in the court's 1929 decision. The man himself comes down to us as a surname, Foret, and a piece of arithmetic.

I've read a good many court records in my time, and that's the usual trade: the numbers keep and the person mostly doesn't. I don't know whether Foret found other work that summer, how his household got by, or what got said at supper the night the ruling came down. So I'll stick with what he put on paper. It mattered more than he could have guessed, because the answer the court gave him turned into the answer for a lot of other people.

Three days before the dynamite

A levee is a long wall of packed earth along a river that keeps the water off the land behind it. In April 1927 the Mississippi was running higher than anybody alive had seen, and levees upriver were giving out one after another.

On April 26, Governor Oramel Simpson signed a proclamation authorizing a cut in the levee at Caernarvon, a few miles downriver from New Orleans. The idea was to let the river spill out below the city so the water passing New Orleans would drop. The proclamation called it emergency protection, and it said the Mississippi River Commission and named state and local engineers were behind it. It also contained the one sentence this whole story turns on:

On April 29 the dynamite crews went to work. The water went where everybody knew it would go, into lower St. Bernard and Plaquemines parishes, onto trappers, fishermen, small storekeepers, and the people who worked for them.

Whether the cut was necessary got argued at the time, and I'm not going to settle it from a kitchen table ninety-nine years later. The financial press, the Commercial and Financial Chronicle among them, said opening the levee was good for New Orleans and allowed that the people downstream would pay for it. Legal historians working from period accounts say the experts were divided, and PBS reports that the regional weather chief, Isaac Cline, told a newspaper the danger to the city was remote. Then an Associated Press story dated April 30 reported a big levee break upstream at Glasscock, after the blasting at Caernarvon had already started. Later writers argue that break would have relieved the city anyway. Maybe so. But the governor signed on the 26th, and the 26th is what he had to work with.

People did get paid

That needs saying plainly, since the rest of this is about the losses that weren't.

A Reparations Commission was reviewing and paying claims before the legislature even met. Then lawmakers held a special session and passed Act No. 2 of 1927, which went into the state constitution in April 1928. It put the debt on the Orleans Levee Board and funded it with a special property tax in New Orleans and with bonds. The law promised:

"Encroachment" just means the water coming in where it didn't belong. So the city that got saved paid the bill, which is about as fair as these things get.

But notice the words moved. The governor promised to pay for "damage to property." The constitution said "losses." Foret's paycheck had stopped, inside the affected area, on account of that water. Read the way a working man reads a promise, his $2,625 looked like exactly the kind of loss the law was talking about. He filed.

December 2, 1929

Set the two sides of the case next to each other. Downstream was a man whose pay had stopped, with the arithmetic to show for it. Upriver, in the city, was the bill: a debt the constitution had hung on the Orleans Levee Board, paid for by a New Orleans property tax and by bonds, against claims that later histories would put above $35 million. Nothing in the opinion says the size of that bill moved anybody's vote, and I won't say it for them. Both things were sitting there when the justices sat down.

The court said no, and it came down to a few words. The constitution promised compensation for losses "as the result of the encroachment of said waters." The court read that as covering "damages to what is encroached on by the waters, that is, physical property." The first phrase is about what the water caused. The second is about what the water touched. Somewhere in between, the constitution's broad word, "losses," got read back down to something pretty close to the governor's original "damage to property."

Lost wages, as the court saw it, were consequential damage, a lawyer's term for harm that's real enough but sits one step off from whatever actually got hit. The water reached the motor company's building. It reached Foret's pay only by way of the business that signed his checks.

The justices didn't make this up on the spot. Their reasoning went like this. Cutting the levee was an exercise of the state's police power, its general authority to act for public safety, and under the law of the day that kind of act didn't by itself give anybody a right to be paid. So whatever Foret got, he got because lawmakers chose to give it. An earlier case, Ward v. Board of Levee Commissioners, said gifts like that from the legislature should be read narrowly. The court also leaned on cases where the government takes land for public use, and on ordinary injury suits, where an employee generally can't collect wages he lost because somebody damaged his employer's business.

You can dislike where the line fell and still see that judges in 1929 were applying the rules they had to a promise worded the way it was.

The same day, the court turned down Alfred Oliver & Co., a fishing business asking for lost profits. Part of the reasoning was that a business doesn't own fish it hasn't caught yet; those belong to the state. I've known fishermen who'd have argued that point with the court, and with the fish.

A separate line for lost income

In March 1930 a trading business on Delacroix Island got paid for its property and was refused its lost trading profits.

The Louisiana Southern Railway, whose tracks ran down into the flooded country, shows the sorting about as clearly as you could want. Its claim came in on separate forms. Schedule A was for property damage. Schedule G was for lost income and expected profits. The property claim started at $140,044.34 and was settled, for what amount the record doesn't say. The railway kept after the $28,309 in income it said it lost on the line below Violet Canal. On February 27, 1933, the court said no, citing Foret, Oliver, and the Delacroix trading case, Fabre. Chief Justice O'Niell dissented, arguing the railway's situation was different from those cases, and he lost that vote. Three years and change after Foret's ruling, judges had stopped arguing over his case and started citing it.

What stayed with me was Schedule G. Somewhere in the paperwork, lost income had its own line, separate from property. I couldn't find the commission's own rulebook, so I can't tell you who drew that line or what they figured would go on it. What I can tell you is that when the railway's Schedule G claim got to the Supreme Court, the court said it didn't count.

The rule wasn't perfectly tidy. A 1935 case shows the Reparations Commission made a payment tied to a lost trapping season, split between landowners and trappers under a particular contract. One case doesn't make a pattern, but money connected to a lost season did change hands at least once.

Go easy on the totals. Those later histories put payments at roughly $2.9 million or $3.9 million, with the average individual claimant getting $274 or $284, depending on which source you believe. They don't work from the same records or the same cutoff dates. Take the figures as a rough sketch and no more.

Who ends up in which column

In issue #44 I wrote about San Francisco in 1906, where a good deal of earthquake damage got called fire damage because the insurance covered fire. Nobody in St. Bernard relabeled anything to get paid. A governor signed one sentence in an emergency, lawmakers wrote a broader one, and a court read the broader one the way courts then read grants from the state. The sorting got done in the open under ordinary rules, and that's a big part of why it held.

When I was at sea, a ship laid up for repairs became somebody's insurance claim, itemized right down to the hull plates. The crew sent ashore without pay weren't on it anywhere. Nobody called that a scandal; it was just how the paperwork was built. Foret was a manager with a city address, not a wiper in an engine room, and I won't make him into more than the record shows. But his eight months landed in the same column ours did.

Plenty of coverage sold today still keeps damage to things and loss of income in separate columns, and a lot of people find out which column they bought on the day they file. Foret's question, which of my losses counts as property and who gets to say what the important sentence means, got its answer two and a half years after the water came in.