Damage Suits: Who Pays for Riots?

As violence flares in U.S. ghettos, legal questions smolder in the embers: If the state is obliged to maintain civil order, must it indemnify the citizen for property loss and personal injury from riots?

There is no generally accepted answer in U.S. law. Since 1883, when the Supreme Court ruled in Louisiana ex rel. Folsom v. New Orleans that legislatures created and therefore may withdraw or modify the right to riot relief, the question of liability has been bounced around by the states, cities and counties.

Meanwhile, insured claims for the Detroit riot losses are estimated at $200 million, the largest yet. (Watts was $38 million, Newark $15 million.) Total damage could be considerably higher. Some damaged ghetto properties were considered uninsurable. Insurance generally covers only about half the actual property damage in most riots. Moreover, most policies do not cover personal riot injuries.

Sovereign Immunity. Insurance companies confronted with Detroit claims can try to sue the city, but in the absence of statutes, nothing in common law makes a city, county or state liable for riot damages unless it has somehow acted negligently. Even then, many governmental bodies are protected by sovereign immunity, a musty theory that public monies can be used only for the general public, not to compensate individuals, such as riot victims. But legal scholars contend that sovereign immunity is unjust, illogical, and riddled with exceptions. Moreover, courts have gradually eroded or discarded the doctrine in several states. Once sovereign immunity is removed as a defense, a city or county is liable much like an individual charged with negligent performance of duty.

Roughly half the states now have statutes imposing some sort of liability on municipalities for riot damages. Illinois, which has the most comprehensive law (1961), pays up to $30,000 for property or injury, including death, even when the municipality has not been negligent. New York has a liability law, but it was suspended during World War II (for fear that wartime losses and injuries might be prohibitive), and the legislature has suspended it periodically ever since. Michigan has no liability statute whatever.

New Jersey has imposed liability since 1877 for property damage in cities with paid police forces. However, the claimant cannot collect if he was negligent in protecting his property or failed to advise police that it was in danger. To determine how the law affects victims of the Newark riot, merchants and tavernkeepers are lining up to file test cases.

Community Responsibility. Liability laws are in effect in three Pennsylvania counties: Philadelphia, Allegheny (Pittsburgh) and Northampton (Easton). After the 1964 riots, Philadelphia reimbursed insurance companies $650,000 for riot claims, paying off at the rate of 750 on every dollar paid out by the companies. It still has outstanding claims of about $250,000. California repealed its 95-year-old liability law in 1963, two years before Watts. Now Californians can collect only by suing the private individual responsible or by proving negligence by individual officers, and suing them instead of the government.