Australia: Flooding and legal liability – what are we seeing?

The recent and ongoing extreme flood events are raising a series of legal issues. These include managing flood risk and development in areas subject to inundation, the liability of public authorities for decisions that expose residents and businesses to greater risk from flooding events, and remedial steps to address past decision-making.

Managing flood risk

Increased incidence and severity of floods as a result of factors such as changing land use patterns and climate change will cause damage to residences, agriculture, businesses and public and private infrastructure.

According to the Australian Disaster Resilience Handbook (Handbook 7), one avenue to address this is to manage development in at-risk areas and direct development toward safer places.

Planning schemes determine permissible land use and development. In Victoria, for example, there are a number of planning policies that address flood risk. The Urban Floodway Zone can be used to prohibit inappropriate land uses in high flood risk areas, and overlays such as the Floodway Overlay, Land Subject to Inundation Overlay, and Special Building Overlay are also used to control development.

The mapping for the application of these planning controls to land will have been typically based on predictive flood modelling and data from previous flood events. Because data from previous flood events does not necessarily accurately predict future events, this raises the prospect that areas at actual flood risk are not identified in the planning scheme.

What liability do public authorities have for historical statutory and strategic planning decisions that have the effect of allowing use and development in areas that are now no longer safe?

Case studies

Salient examples include the 2011 flooding of Grantham in South East Queensland. Almost every house in the floodplain area of the town sustained structural damage in what was described as an "inland tsunami." 17 lives were lost.

In partnership with the Queensland Reconstruction Authority, Lockyer Valley Regional Council responded by organising the relocation of the existing town. Only months after the flooding, it was announced that a 935-acre site was purchased to facilitate a voluntary land-swap program. This gave residents the option of relocating to higher ground, with some eligible for state government assistance to rebuild in the new area. The new area was zoned for community purposes, residential living, rural residential, sport and recreation, and open space to encourage residents and businesses to move.

As of 2020, 80 families were living in the relocated area. In February 2022, the area was again inundated with flood waters but those in the new development managed to avoid damage.

Another example is Grand Forks, Canada. After flooding in 2018 that damaged 500 buildings, the local council obtained funding from the federal and provincial governments to bolster flood mitigation efforts, including funding to acquire 80 homes in flood-prone areas. These acquired homes were to be demolished. Reportedly, the houses were acquired at their post-flood value, meaning that many residents received substantially less money than they were expecting.

Are decisions made during emergencies protected?

Another issue in regard to flooding and the liability of public authorities concerns decisions made in emergencies. Is there some kind of protection for decision-makers in such difficult circumstances?

Following the 2019/20 Black Summer Bushfires, the National Emergency Declaration Act 2020 (Cth) was introduced to allow the federal government to respond to emergencies. As part of that Act, certain requirements of other laws may be bypassed in the event of a nationally significant emergency.

In early 2022, then Prime Minister Scott Morrison declared a national emergency in response to flooding in northern NSW. This declaration was accompanied by flood relief funding and recovery efforts. Disaster relief payments were made available to affected households, and other recovery services such as mental health care, food relief and financial counselling were also to be funded.

In Victoria, the Emergency Management Act 1986 (Vic) defines an emergency as "the actual or imminent occurrence of an event which in any way endangers or threatens to endanger the safety or health of any person . destroys or damages . any property or threatens to endanger the environment." This explicitly includes flood.

The Victorian Water Act 1989 contains provisions that address liability for the flow of water that causes damage. One of the matters to be taken into account in determining liability is whether a flow of water was caused by the construction, removal or alteration of a levee in accordance with the Victoria State Emergency Service Act 2005, and if it was in response to an emergency under the Emergency Management Act 2013 (Vic).

Caselaw also establishes that if the flood event were of such severity that the flooding would have occurred anyway, liability will not arise. Does liability arise in regard to decisions made by the operators of Murray Basin storages to release limited water heading into a wet spring, resulting in the need to release water from those storages during flood events? What about the damage reportedly caused to some 245 surrounding properties from flooding of the Maribyrnong River? Was this worsened by the flood wall surrounding Flemington Racecourse? Or would the flooding have occurred anyway, regardless?

Key takeaways

Planning controls seek to address flood risk and development in areas subject to inundation. Outdated or inaccurate mapping increases safety risk. Public authorities face potential liability for decisions that expose residents and businesses to greater risk. As to whether liability arises, central factors can include whether or not the decisions were made in an emergency situation and whether damage from water flows has been worsened by the relevant decision or whether the event was of such magnitude that damage would have occurred anyway.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.