Arcade Water District, a Public Agency of the State of California v. United States

Arcade Water District (“Arcade”) sued the United States under the Federal Tort Claims Act (“FTCA”), 28 U.S.C. § 2674 , for contamination of an Arcade well by a military laundry. The district court dismissed the suit with prejudice, holding that the FTCA statute of limitations bars the suit. Arcade timely appealed. We reverse.

FACTS AND PROCEEDINGS

Arcade Water District is a California public agency supplying water for domestic use in Sacramento County. Since 1956, Arcade has owned and operated “Well 31.” In 1941, the United States began operating a laundry at Camp Kohler Annex, McClellan Air Force Base. The laundry was located about 2,000 feet from the site of Well 31. The laundry discharged residues into the ground which, Arcade alleges, have contaminated Well 31. Arcade's testing of water from Well 31 showed gradual deterioration of quality from 1955 through 1979. In 1973, the United States closed the laundry. Nonetheless, ground contamination from the laundry apparently continued to leach into Well 31, and leaching still continues. In 1979, Arcade removed Well 31 from service because of customer complaints. In 1981, Arcade learned the contamination was caused by the military…