By statute, North Carolina has capped the monetary awards available for nuisance claims related to agricultural or forestry operations. The law, H.B. 467, was designed to protect hog farms and other concentrated animal feeding operations (CAFOs) from substantial judgments in odor nuisance lawsuits. It limits compensatory damages to the reduction in the fair market value of the plaintiff’s property, if the nuisance is found to be permanent, and the diminution of the fair rental value of the property if temporary. The bill passed over the veto of Governor Roy Cooper.
The limits on awards set by H.B. 467 are cumulative. A subsequent action by the same plaintiff or a successor to plaintiff is restricted to the fair market value of the property, less what was recovered in the earlier lawsuit. The limit applies even to lawsuits against separate defendants arising from distinct operations. H.B. 467 does not, however, place limits on available punitive damage awards or bar any otherwise available injunctive relief.
North Carolina joins a handful of other states that have passed similar legislation in recent years aimed at limiting the amount of damages available for agriculture related nuisance claims.
The legislation is a reaction to an increase in odor nuisance lawsuits in North Carolina and elsewhere in the country. In 2013, more than 400 plaintiffs filed nuisance lawsuits against Murphy-Brown, LLC, a subsidiary of Smithfield Foods, Inc., the largest pork producer in the world. Some of those cases are still pending. An early version of the bill would have had retroactive application and limited recovery in the suits that have not been resolved. That provision, however, was changed before the bill passed.
H.B. 467 is a continuation of legislative efforts to insulate the North Carolina livestock industry. A 2013 bill, S.L. 2013–314, amended the state’s right-to-farm law, which prevents operations from becoming a nuisance as a result of changes in the surrounding community. Agricultural facilities cannot benefit from right-to-farm protections if they undergo a fundamental change from previous operations. But the law broadly exempts several categories of changes – including changes in size and technology – greatly curtailing plaintiffs’ recourse against expanded and updated CAFOs.
Collectively, these changes will make it much more difficult for plaintiffs to recover in nuisance actions against North Carolina CAFOs in the future, and will likely turn off many plaintiffs’ lawyers from investing the time and resources into even winnable cases.