Army Corps cleanup mistakes and the boilerplate that could burn homeowners twice

Various news outlets have reported that the government removal of Los Angeles wildfire debris has given rise to environmental concerns and complaints from homeowners and others over the care and completeness of the Army Corps of Engineers' cleanup efforts. Others report homeowners' unhappiness with the "onerous" and "unreasonable" terms on which the cleanups are offered. But that may not be the worst of it. How many homeowners who opted into the "free" Army Corps cleanup the government advertised realize that the fine print they signed onto includes an undertaking to pay, out of their own pockets, for any environmental or other damage that the cleanup might cause, whether on their property or elsewhere?

Yes, that's right: homeowners who signed the standard "Right of Entry" (ROE) document required to opt into the Army Corps cleanup agreed -- according to the fine print there on page six of the 12-page document -- to become, in effect, the liability insurer of all the government agencies and contractors performing or otherwise responsible for the cleanup. The one-sentence "indemnification" provision of the ROE agreement states that the property owner "agrees to indemnify, hold and save harmless the Government from any and all claims, damage, or losses arising out of the Program activities carried out pursuant to this ROE." The ROE defines "Government" to include the County of Los Angeles, the State of California, the United States government and tribal representatives, "including their officers, employees, agencies, and independent contractors" -- in other words, anyone who lifts a finger in connection with the Army Corps cleanup.

Although average citizens might be forgiven for lacking familiarity with legal terms of art like "indemnify" and "hold harmless," included among the thousands of homeowners who signed the ROE agreement are lawyers, and even judges, who know exactly what those words mean, but were in no condition or position to push back on them. They mean that the homeowner is pledging their entire net worth to protect the Government from any consequences of their own (mis)handling of the cleanup. That includes not only paying "any claim" successfully made against the Government (again, including its contractors) that might arise out of their work, but also paying the fees of any lawyers it might hire to defend against such claims, because in California, an agreement to indemnify includes, unless otherwise specified, a duty to defend the indemnified party. (Civil Code § 2778(4).)

Simply put, the hapless Owners who signed the ROE not only lost their homes and possessions. They also became the insurance companies for every government and private actor who turned a shovel to remove their debris, or haul it away, or deposit it somewhere else.

These are not imaginary risks. (If they were, why would the Government demand to be indemnified against them?)  When mistakes are made in earthworks and hazardous waste handling, lawsuits are often not far behind. Reporting by the Los Angeles Times has noted concerns expressed by property owners over incomplete removal of contaminated soils, as well as concerns raised by those living near disposal sites where the hazardous debris that is removed is deposited. The ROE document obliges property owners signing it to bear the legal consequences flowing from errors in planning and executing the cleanup.

This, of course, is unconscionable. The Government should be the party protecting homeowners from cleanup mistakes it makes, not the reverse. As those fortunate enough to have insurance that paid for privately conducted debris removal may have noticed in their own fine print, at least some private debris removal contractors not only don't demand that homeowners pay for the contractor's mistakes; they promise to hold the homeowner harmless from liability for such mistakes. The ROE's shifting of risk onto homeowners is, in short, upside-down from the sensible allocation of responsibility the free market produces.

Remarkably, not one Government representative this writer contacted about that misallocation of risk (as he contemplated signing the ROE for his own incinerated condominium) even attempted to explain or justify the document's bizarre indemnification provision. Every single city, county, state and federal official -- including my elected representatives at every level and various civil servants reporting to them -- either wholly ignored my questions or executed a finger-point suggesting that I inquire elsewhere. (I especially appreciated the robo-email from my Assembly member, informing me that my inquiry had been "deleted without being read." Points for honesty, at least.)

As I sat in my rental home two months after the fire and considered the looming deadline for signing on to the ROE, I found myself thinking, "what a great bar exam question." First, discuss Owner's tort liability to a worker and a passerby injured by a Government bulldozer in the course of the removal. Then, Owner's liability to their future guests, tenants and neighbors for exposing them to toxic materials the Government failed to remove. And next, to persons living adjacent to the disposal site where his waste was deposited. (Don't forget any statutory liability Owner has a hazardous waste generator.) 

Then move on to Owner's liability to defend and indemnify the Government and its contractors -- aka their codefendants -- against those liabilities. Consider whether Owner's indemnification liability might be defeated by claiming duress, and whether the fact that the Government calls the ROE a "permit" rather than an "agreement" is significant. Then discuss whether Owner has effectively waived their own tort claims against the Government. Oh, and any contract claims it might have (is the ROE a contract for services, or a license?). Finally, identify the court and the controlling law that will determine Owner's various rights and obligations -- the ROE being silent on both points.

The proponents of the Army Corps cleanup program appear to either not have answers to these questions or not want to say what they are. Should the day come when "the Government" finally does offer some comment on the ROE's misconceived indemnification provision, one response that will not suffice is "don't worry about it -- the indemnification will never be called on, nobody will ever sue you for what the Army Corps does, and the Government will never ask you to indemnify it." Maybe not; the Government does enjoy significant immunity for such claims. But still: if those things are really never going to happen, then (a) again, why is the Government worried enough to require that Owners indemnify it against them, and (b) why doesn't the Government indemnify Owners, as it certainly should, against the liabilities its activities create? And in 2025 - the Year of the DOGE - should I really trust FEMA, the Army Corps or other Government actors not to enforce a contract I signed for their benefit according to its express terms?

Fine print matters. Unjust and inefficient fine print that the Government crams down the throats of traumatized, dispossessed homeowners already under serious economic and psychological duress matters a lot -- optically, legally and morally. Government officials who feel otherwise aren't getting my vote.

And no, I didn't sign on to the indemnity.