QIM 35  |  Part 1 of 5  |  Law Desk & Wildfire Litigation

A power company can follow every safety rule and still owe for the fire its line started. That is not an accident of the law — it is the design.

A conversation between Ava and Michael

Ava: Michael, when a wildfire is traced to a utility's equipment, what actually makes the utility liable?

Michael Benavides, Esq.: In California, the heavyweight doctrine is inverse condemnation. When a public utility's equipment causes property damage — a downed line, a failed transformer — the utility can be held strictly liable for that damage, meaning a property owner does not have to prove the utility was careless. Causation plus damage can be enough.

Ava: Strict liability — so 'we followed every regulation' is not a defense?

Michael Benavides, Esq.: Largely not, and that is the part that surprises people. A utility can comply with every safety rule on the books and still face liability if its equipment is a substantial cause of the fire. The theory is that a utility, like a government taking property for public use, should spread the cost of damage its infrastructure causes across all the ratepayers who benefit from it — rather than leaving it on the burned-out property owner.

Ava: Where does the money to pay these claims come from?

Michael Benavides, Esq.: After the catastrophic fires of the 2010s, the Legislature passed AB 1054 in 2019, which created a multibillion-dollar Wildfire Fund for the state's large investor-owned utilities and tied access to it to obtaining an annual safety certification. The fund is a mechanism to pay valid wildfire claims and stabilize the utilities — it does not erase the underlying liability.

Ava: Is inverse condemnation settled law, or is it contested?

Michael Benavides, Esq.: Candidly: it is settled as doctrine but politically contested. Utilities and some policymakers argue strict liability without a fault requirement is unfair and push for reform; consumer advocates argue it is the only thing that reliably compensates fire victims. Proposals surface regularly. So treat the strict-liability framework as the current rule while understanding it sits in an active debate that could shift.

Ava: Does inverse condemnation only reach utilities?

Michael Benavides, Esq.: The classic application is a public entity or public utility whose improvement causes the damage. A purely private actor who starts a fire is usually pursued under ordinary negligence instead — a different proof standard where fault matters. Identifying who and what started the fire is therefore the first and most consequential question in any fire case.

Ava: What should a property owner do early?

Michael Benavides, Esq.: Preserve everything: photographs, the origin-and-cause information, any official reports, and the physical evidence where possible. Fire cases turn on a cause-and-origin determination, and evidence degrades or gets cleared fast. Whether the path is inverse condemnation, negligence, or an insurance claim depends on facts that are easiest to capture in the first days.

Ava: The plain-English version?

Michael Benavides, Esq.: If a utility's equipment started the fire, California law may hold it responsible for your property damage even if it did nothing careless — but proving the cause, and doing it quickly, is the whole ballgame.

Disclaimer

Attorney advertising. This is general information about California law, not legal advice, and reading it creates no attorney-client relationship. Wildfire, insurance, and landlord-tenant law is highly fact-specific; statutes, regulations, and Department of Insurance bulletins change frequently and courts apply them differently to different facts. Some points below are expressly flagged as unsettled or in flux. Confirm the current rules and how they apply to your situation with a licensed California attorney before acting. Michael Benavides, Esq. — California State Bar No. 270714. Ava Benavides is an editorial brand voice, not an attorney, and does not provide legal analysis.