Transcript Property I Fall 2008

Property II
Professor Donald J. Kochan
Spring 2009
Class 52
8 April 2009
Today’s Readings

Regulatory Takings Issues
 Loretto
 Penn Coal
 Penn Central

Pages 960-1006
Underlying Principle
“The Fifth Amendment's guarantee that private
property shall not be taken for a public use
without just compensation was designed to bar
Government from forcing some people alone to
bear public burdens which, in all fairness and
justice, should be borne by the public as a
whole.”
Armstrong v. United States, 364 U.S. 40, 49
(1960).
Loretto

Cable wire case

Any physical invasion constitutes a per se taking,
no matter how minor – first categorical rule

Minimal impact can be taken into account at the
compensation stage

Underscores the three-part test: decide if it is a
taking, then decide if it was for a public use,
then decide just compensation
Penn Coal


Deeds and Private Agreements

Reservations and Split Estates
Subsidence regulations limiting full extraction of coal and
interference with deed provisions


Police Power v. Takings
Holding: “So far as private persons or communities have seen fit to
take the risk of acquiring only surface rights, we cannot see that the
fact that their risk has become a danger warrants the giving to them
greater rights than they bought.”
Penn Coal



Most influential regulatory takings case in history precisely because
it has shaped all subsequent takings law and contributed to takings
struggles and confusion
Consider the ambiguities in the test applied
What is a regulatory taking? Alternatively, when does a regulation
of property rise to the level of a taking, or when is a regulation just
a regulation (the “yes we realize the regulations are reducing your
dominion and taking away sticks – deal with it!”)?
For a web version of the case from FindLaw:
http://laws.lp.findlaw.com/getcase/US/260/393.html
Mr. Justice Holmes and Penn Coal
http://www.supremecourthistory.org/02_history/subs_timeli
ne/images_associates/049.html
Penn Coal
From the majority opinion (emphasis added):
“As applied to this case the statute is admitted to destroy previously existing
rights of property and contract. The question is whether the police power
can be stretched so far.
Government hardly could go on if to some extent values incident to
property could not be diminished without paying for every such
change in the general law. As long recognized some values are enjoyed
under an implied limitation and must yield to the police power. But
obviously the implied limitation must have its limits or the contract and due
process clauses are gone. One fact for consideration in determining such
limits is the extent of the diminution. When it reaches a certain magnitude,
in most if not in all cases there must be an exercise of eminent domain and
compensation to sustain the act. So the question depends upon the
particular facts. The greatest weight is given to the judgment of the
legislature but it always is open to interested parties to contend that the
legislature has gone beyond its constitutional power.”
Penn Coal
From the majority opinion (emphasis added):
“The general rule at least is that while property may
be regulated to a certain extent, if regulation
goes too far it will be recognized as a taking. It
may be doubted how far exceptional cases, like the
blowing up of a house to stop a conflagration, go-and if
they go beyond the general rule, whether they do not
stand as much upon tradition as upon principle. In
general it is not plain that a man's misfortunes or
necessities will justify his shifting the damages to his
neighbor's shoulders.”
*Sets up the “ad hoc, factual inquiry”
Penn Coal (cont.)

Brandeis Dissent




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Police Power focus
“Reciprocity of Advantage” Issues and the “Civilized
Community”
Diminution in Value Issues
Conceptual Severance Issues
The Taft
Court
with
Holmes and
Brandeis:
Penn Central
NYC’s Grand Central Terminal and the application to build an office
building atop the terminal


Landmarks and Historic Preservation Regulations that restrict use of
property
Zoning Issues



TDR Issues
Precursor to later cases – majority and dissent inform the later
regulatory takings cases
For a web version of the case from FindLaw:
http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=US&vol=438&invol=104
Penn Central


Case attempts to define further Penn Coal’s “too
far” test – describes the “struggle” and
“considerable difficulty” with “no set formula” to
decide if a regulatory act is a taking
Focus on Court’s discussion of:



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Interference with Reasonable/Distinct
Investment-Backed Expectations
Character of the Governmental Action
Benefits and Burdens
The Common Good
Penn Central
From the majority opinion:
“In engaging in these essentially ad hoc, factual inquiries,
the Court's decisions have identified several factors that
have particular significance. The economic impact of the
regulation on the claimant and, particularly, the extent to
which the regulation has interfered with distinct
investment-backed expectations are, of course, relevant
considerations. So, too, is the character of the
governmental action. A "taking" may more readily be
found when the interference with property can be
characterized as a physical invasion by government . . .
than when interference arises from some public program
adjusting the benefits and burdens of economic life to
promote the common good.”
Concluding Remarks



Realize the distinction between express
condemnation and eminent domain and what
are termed “regulatory takings”
Examine soft standards and how they affect
judicial discretion and the separation of powers
Understand the difference between “categorical”
and “ad hoc”