Introduction
I was planning to rant about how the Supreme Court seems to have been ignoring land use and property cases lately, having denied certiorari in a significant number of cases presenting interesting issues. But then the Justices came back from summer recess and — so far — have granted certiorari in four property cases to be decided before the end of June 2005: one direct condemnation, one regulatory taking, one water rights/breach of contract case, and one telecommunications/ham radio tower case. Hang on; the next year could be a bumpy ride.
Actually, I'm rather pleased as a prognosticator (of sorts). Those of you who were at this program in February 2002, may recall a presentation I delivered, grandly entitled "Property Rights and Takings Law: Y2K and Beyond." If you missed it, it is memorialized as chapter 4 of the 2002 proceedings of this Institute. In that paper, I suggested an agenda for the Supreme Court, containing issues I thought needed some resolution. (Although I am opinionated enough to have my own views about the proper determination of those issues, I also believe that definitive judicial statements of the law are preferable to anarchy.) I proposed five primary issues for resolution, and look what happened.
The first issue I suggested was an examination of the restriction in the 5th Amendment that limits the use of eminent domain to takings for "public use." I thought it was high time for the Court to examine an issue that it had dealt with only once, and that was fifty years ago — particularly in light of the way that municipalities (particularly redevelopment agencies) were expanding their power to acquire land for the sole purpose of retransferring it to developers who would add more value to the local tax base than the existing uses.
One of the pending cases (Kelo v. City of New London, 843 A.2d 500 [Conn. 2004], cert. granted, No. 04-108) involves precisely that issue.
I also suggested that the Court decide how substantive due process and takings relate to each other. Although the Court turned down opportunities to examine substantive due process cases per se, it agreed to hear a case (Lingle v. Chevron USA Inc., 363 F.3d 846 [9th Cir. 2004], cert granted No. 04-163) involving the first prong of the Agins test. You remember Agins v. City of Tiburon, 447 U.S. 255 (1980), one of the Supreme Court's first regulatory taking cases of the modern era. There, the Court announced that a taking occurs if government action either fails to substantially advance a legitimate state interest or denies the property owner economically viable use.
Some have suggested over the years that the first prong of that test is really a substantive due process test, as it focuses on the validity of the governmental action rather than the fiscal impact on the property owner. The Court, however, has declined invitations to eliminate it. In Lingle (Linda Lingle is the Governor of Hawaii, for those of you who don't follow off-shore politics) the lower courts had directly applied the first prong of Agins to overturn a state law regulating the rent that gasoline refiners could charge to franchisees who lease their stations to sell their gas. The State has directly challenged the validity of that test, suggesting that substantive due process is the appropriate measure of statutory validity, and the Court has said it will now decide the issue.
The other issues I raised (regulatory taking ripeness, the meaning of economically viable use, and a workable test for temporary takings ) remain ripe for Supreme Court review for those who wish to raise them. But having two of my five issues set for review two years after I called for it is not too bad. Stay tuned; who knows.
The Recent Past
The Court has decided a series of land use and takings cases during the past few decades. In this session, we will simply highlight some of the more interesting recent decisions and then discuss the currently pending matters.
Regulatory Taking Ripeness
City of Chicago v. International College of Surgeons, 139 L.Ed.2d 525 (1998) involved an issue familiar to regulatory takings mavens, i.e., federal court jurisdiction, but with a twist: usually, it is the plaintiff property owners that seek federal court review of local action, and usually they fail. Here, it was the city that invoked federal jurisdiction and it succeeded.
The College of Surgeons owned two buildings on Chicago's lakefront that it planned to demolish and redevelop. The city declared them landmarks, which effectively ended that plan. So the Surgeons sued. As required by settled federal law, they filed their suit in state court. (See Williamson County Reg. Plan. Agency v. Hamilton Bank, 473 U.S. 172 [1985], holding that suit in federal court is not ripe until state remedies have been exhausted.) Because the complaint raised the federal constitutional question of whether the city's actions had taken property without compensation, the city removed the case to federal court. (See 28 U.S.C. § 1441[a].)
The District Court entered summary judgment for the city. On appeal, however, the Court of Appeals for the Seventh Circuit reversed, holding that the case was not properly subject to removal because the underlying issues involved municipal actions that were subject to a deferential standard of review and such administrative proceedings did not fit the definition of a "civil action" that could be removed from state to federal court. (International College of Surgeons v. City of Chicago, 91 F.3d 981 [7th Cir. 1996].)
On the city's petition, the Supreme Court granted certiorari and reversed again. To those who have long toiled in this particular legal vineyard, the result was stunning, and the reasoning was even more so.
The facts are not particularly strange or esoteric. They are exemplars of the kind of situations property owners find themselves in routinely in dealing with municipal regulators. However, as noted earlier, when property owners file suit to seek constitutional redress for the impacts of such regulatory actions, they routinely find themselves flung out of federal court and told that they must first run an administrative and litigational gauntlet in the city agencies and state courts before even thinking about seeking federal judicial relief. They cannot sue until after multiple development applications have been made and denied, a variance has been sought and denied, they have obtained from the regulators a "final" determination of what they will be permitted to do with their land, and then they must be able to prove that all of the aforesaid resulted in measurable damage to them. (For evolving discussions, see Michael M. Berger, The "Ripeness" Mess in Federal Land Use Cases or How the Supreme Court Converted Federal Judges into Fruit Peddlers, 1991 Institute on Planning, Zoning, and Eminent Domain ch. 7 [Sw. Legal Foundation 1991]; Michael M. Berger, Supreme Bait & Switch: The Ripeness Ruse in Regulatory Takings, 3 Wash. U. J. of Law & Policy 99 [2000]; Michael M. Berger & Gideon Kanner, Shell Game: You Can't Get There From Here. Supreme Court Ripeness Jurisprudence in Takings Cases at Long Last Reaches the Self-Parody Stage, 2003 Institute on Planning, Zoning, and Eminent Domain ch. 5 [CAIL 2004] .)
In College of Surgeons, however, the Supreme Court airily noted that "a facial challenge to an allegedly unconstitutional zoning ordinance is a claim which we would assuredly not require to be brought in state courts." (139 L.Ed.2d at 537; quoting with approval.) Nowhere in either the majority or the dissent is there any mention of Williamson County and the ripeness hurdles that ordinarily stand impregnably in the way of such an event occurring. Nowhere is there a reference to the abstention doctrine that is routinely used to bar the federal courthouse door to any property owners who are able to allege ripe claims. (E.g., Sinclair Oil Co. v. County of Santa Barbara, 96 F.3d 401 [9th Cir. 1996].)
Where property owners are routinely ushered to state courts, the City of Chicago was told that the claim made against it was one that the Court "would assuredly not require to be brought in state courts."
So the law, after College of Surgeons, is that property owners have to file in state court but regulators have a free hand to remove such cases to federal court at their whim because the action "assuredly" could have been brought in federal court to begin with. Or maybe the entire Williamson County line of ripeness decisions has been swept aside sub silencio. We'll have to wait and see.
Due Process and Takings
Eastern Enterprises v. Apfel, 141 L.Ed.2d 451 (1998) raised as many questions as it answered because the judicial line up split 4-1-4. Factually, the case involved a statute (26 U.S.C. § 9701 et seq.) that sought to place health care responsibility for retired coal miners and their dependents on various companies who are (or, in Eastern's case, were) associated with the mining industry. (It is of interest to land use lawyers because the three opinions discuss challenges to government regulations in the context of takings law v. due process law.) Eastern had been out of the mining business for a quarter of a century before the statute was enacted, had never promised (orally or in writing) to provide such perpetual care to its employees when it had been in the mining business, and therefore thought it unfair that it should be saddled with $100 million in health care costs.
The District Court and the Court of Appeals for the First Circuit upheld the statute. The Supreme Court reversed. That much is clear. However, the seeds of confusion were sown by the way that the individual Justices dealt with the central issues. Is money property? If the government takes your money, has it violated the 5th Amendment's prohibition against uncompensated takings? Those issues seemed to prevent the U.S. Supreme Court from assembling a majority behind a single theory. Five Justices agreed that the government had done wrong, all right, and that its action was invalid. But the fact that the statute only affected the property owner's money — and not some discrete item of property — left the Court without a unified theory for its decision.
The Court's majority found the statute unconstitutional. A plurality opinion authored by Justice O'Connor and joined by the Chief Justice and Justices Scalia and Thomas concluded that the statute was a prohibited taking of property under the Fifth Amendment. Justice Kennedy also saw a Fifth Amendment violation, but he believed the statute violated the due process guarantee, rather than the guarantee against uncompensated takings of property.
While acknowledging that the case was not a "classic" taking case in which some identifiable piece of private property is physically appropriated by a government agency for public use, the Court noted that it has examined numerous economic regulatory schemes over the years in terms of the takings clause of the Fifth Amendment.
Of particular interest in this context were cases examining Congressional attempts to require companies to continue contributing to pension funds. (Connolly v. Pension Benefit Guaranty Corp., 475 U.S. 211 [1986]; Concrete Pipe & Prods. of Cal., Inc. v. Construction Laborers Pension Trust, 508 U.S. 602 [1993].) There, the Court concluded that the statutes were valid because the duties imposed on the employers were not out of proportion to their contributions or to their experience with the plans. Thus, the rule had been repeatedly applied that there is no taking if the statutory demand is not out of proportion.
That opened the door for Eastern. Here, Eastern had had no prior experience with this program, had not entered into any contracts with its employees promising health care (as companies that had continued in business had), and thus this potential $100 million liability came like the proverbial bolt from the blue. The Court inverted its earlier formulations and addressed the question whether a taking occurs when the statutory demand is out of proportion. Four Justices believed it did.
The plurality concluded that it is unconstitutional to enact this kind of ex post facto legislation that is out of proportion to Eastern's participation in the industry or any of the more recent activities that led to the statute's enactment.
Justice Kennedy supplied the fifth vote to invalidate the statute. He agreed with much of the plurality's analysis of the facts, but concluded that the facts showed arbitrary government action that violated due process, rather than a taking. Justice Kennedy's point of departure from the other four was his belief that the Takings Clause does not protect money, as opposed to other forms of property. As he put it, the statute "imposes a staggering financial burden on [Eastern]" (141 L.Ed.2d at 481), but the burden is not linked to any specific piece of identifiable property. It only requires the payment of money and is "indifferent" to how Eastern goes about making those payments or where it gets the money from.
The four dissenters agreed with Justice Kennedy that the proper legal theory for this case was due process, rather than takings. They parted company, however, because they believed the government's actions were reasonable and just.
This strange lineup has led some to speculate that the Supreme Court is ready to "jettison" the classic formulation that a taking occurs if a regulation fails to substantially advance a legitimate state interest. They reach this conclusion by simple arithmetic: four dissenters plus one Kennedy equals five Justices who prefer due process analysis to takings analysis. There's one problem with the arithmetic. Justice Kennedy's opinion makes it clear that his preference for due process in Eastern was caused wholly by the fact that it was an economic regulation case that did not involve the regulation of specific real estate. No one reading that opinion could believe that he would have reached that result if Congress had ordered Eastern to transfer title to some discrete parcel of land in order to secure the health care benefits.
Indeed, when the opportunity arose shortly thereafter in City of Monterey v. Del Monte Dunes, 526 U.S. 687 (1999), with the municipal briefs urging that the Eastern Enterprises rationale (i.e., that of the five "due process" Justices) required reversal, Justice Kennedy wrote the Court's opinion affirming a judgment in favor of the landowner.
Nonetheless, one of the cases now pending in the Court raises the due process issue anew. We can only wait.
Regulatory Taking Award Affirmed
Del Monte Dunes had a fact pattern that cried out for relief. The case involved a 37.6 acre parcel of vacant land on the coast at the north end of Monterey. It was the site of a former Phillips Petroleum Company "tank farm" that was once home to large oil storage tanks that had ceased operations a number of years ago. Although in need of some environmental clean up, the city zoned the property for high density residential use, its ordinances allowing as many as 29 homes per acre, or more than 1000 for the entire parcel.
The owners didn't want to build 1000 homes. They asked only for leave to build 344. The city's Planning Commission told them that 344 was too dense (notwithstanding that the zoning permitted three times that many), but that a project of 264 would be favorably received. After the owners redesigned their project for the requested 264 units, the Planning Commission decided that too was too dense and suggested a redraft for 224 units. When that redesign was also turned down, the owners appealed to the City Council. There, they were told to do another plan for 190 units. During this process, the owners and the city planners had also negotiated certain "dedications" of property and areas of non-use. In order to secure any approval, the owners agreed to give the seaward 1/3 of the property to the city as a public beach, and to construct a parking lot and access road for that beach. The inland 1/3 would be restricted to non-use so that the part of the property adjoining State Route 1 would be left in its natural condition. A buffer zone of undeveloped land would also be left on the northern side to protect the adjoining State beach park from encroachment by the housing development. Finally, the central area that remained for development would have to be excavated and deepened so that the rooftops of the homes would not be visible to motorists on the highway. In all, only 5.1 of the 37.6 acres would be usable for buildings.
When the owners brought back their final 190 unit plan, having complied with all the conditions imposed by the city, the City Council turned it down. It now said that the best spot on the property for growing native buckwheat plants was the central portion that had been set aside for housing. The importance of the buckwheat was that it was the only habitat for an endangered insect called Smith's Blue Butterfly. Although no such butterflies had ever been seen on this property, the city insisted on maintaining a sanctuary for them in case any ever showed up. Sort of a Field of Dreams ("if you build it they will come") theory. And the city refused to permit the housing to be moved either to the beach or the dunes near the highway. Thus, the owners could get a permit to build on condition that they gave everything away and built nothing. That's when they gave up and sued. They had been through five years of planning, five formal decisions by city agencies, and 19 different site plans. Eventually, they sold the property to the only buyer in sight (the State of California) at a distress price and sued for the temporary taking of their land.
A federal jury decided that the city's actions had taken the property and constitutionally required compensation. Under the judge's instructions, the jurors determined that the property was taken, beginning with the date the city denied the final development application and continuing through the end of the trial. (See First English Evangelical Lutheran Church v. County of Los Angeles, 482 U.S. 304 [1987].) The jury decided that the treatment accorded these property owners denied them the economically viable use of their land for that period and also failed to substantially advance a legitimate public interest. (See Agins v. City of Tiburon, 447 U.S. 255 [1980].) That damage award was affirmed by the Ninth Circuit Court of Appeals (Del Monte Dunes at Monterey, Ltd. v. City of Monterey, 95 F.3d 1422 [1997]) and then by the U.S. Supreme Court.
The Supreme Court's decision is noteworthy more for its discussion of the 7th Amendment than the 5th. The trial judge had submitted the takings liability issue to the jury for determination and the City challenged that. Indeed, its appellate question was even broader, with the City urging that neither judge nor jury had the right to "look over its shoulder" and "second guess" municipal decisions.
The Supreme Court held first, that the City's broad challenge to "second guessing" was wrong as a matter of settled law. Then the Court held that a jury determination was appropriate. Both of those holdings, plus the fact that this was the first time the Court had ever actually affirmed an award of compensation for a regulatory taking (prior cases had all involved pleading issues) set it apart.
One other note. Oral argument scared the pants off some public lawyers and officials. Aside from the fact that the questioning broadly hinted the Court's unhappiness with the way the City had treated the landowner, several Justices cast aspersions on the City's motivations. Not that anyone was particularly surprised when Justice Scalia mentioned that, there comes a time in a protracted land use process when one beings to "smell a rat." Or that Justice Kennedy made similar (if less colorful) comments. It was when Justice Suiter inquired what the outcome should be if the "character of the governmental action" (one of those Penn Central factors for uncovering regulatory takings) was "bad faith." As it happened, those concerned heaved a collective sigh of relief when the opinion came down. The City lost, but there was no mention of the "bad faith" issue.
Equal Protection
After Del Monte Dunes, the Court decided to tackle the question of equal protection in land use regulation, choosing the case of Village of Willowbrook v. Olech, 528 U.S. 562 (2000). There, the Village demanded the gift of a 33-foot easement as the price for allowing Mrs. Olech to connect her property to the municipal water supply. No one else had been subjected to that condition.
The issue before the Court turned out to be whether a "class of one" could claim the protection of the equal protection clause. Pardon a personal interjection here, but I thought the whole point of the equal protection clause was to protect individuals against being treated differently from everyone else. Why should a "class of one" be excluded from protection that seems definitionally built into the 5th Amendment? (As it turned out, my knee jerk wasn't too off-base, as Justice O'Connor asked essentially that same question at oral argument.)
The Court decided that everyone — even if they constitute merely a "class of one" — is entitled to equal protection.
Glancing Geese. Or Would a Reasonable Bird Dine There?
So, assume that you are a goose, flying across Illinois on your way to Canada for the summer. It's getting on toward nightfall and you could use a place to get a drink and maybe spend the evening. You glance down and notice a small wet spot and decide to look it over. One of two things will happen. Either you will decide to land and check in for the night, or you might just glance off the surface and decide to look elsewhere.
Here's the legal question your behavior has just raised: are you traveling in interstate commerce, such that the federal government has the jurisdiction to regulate the use (or non-use) of that little wet spot (and the land surrounding it), regardless of whether it is connected to larger bodies of water, or whether it is navigable, or whether it is just a prairie pothole or some other moist mote by the side of the road, or a low point in someone's back yard?
The U.S. Army Corps of Engineers, believing that such geese are participating in interstate commerce (either by their own travel, or that of folks who would like to shoot at them), concluded it had regulatory control over every possible landing site for migratory birds. The Corps thought that when Congress authorized it to regulate "navigable waters," it included any water on which a reasonable bird might land. Thus was borne the glancing goose rule, or the reasonable bird rule, or (as the Corps preferred) the migratory bird rule. The U.S. Supreme Court thought otherwise and struck it down. (Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers, 531 U.S. 159 [2001].) (SWANCC.)
"Foul!" cried the environmental community. That dastardly conservative majority on the Supreme Court is at it again. Those heartless beasts have just undermined our ability to protect precious environmental resources and safeguard them for our children and theirs ad infinitum in futuro.
Nonsense. Before analyzing what the Court actually did, let's be clear about what the SWANCC case (the acronym given the consortium of governmental plaintiffs) was — and was not — about. It was not about whether the environment should be protected. Nothing in the majority opinion hints that environmental values are not prized or that they should not receive protection. What it was about was federal government usurpation of regulatory power to which it had no right.
If those with the right to regulate choose to engage in precisely the same kind of regulating as the Army Corps, nothing in the Supreme Court's opinion will stand in their way. For example, in California, where I live, nothing has kept state and local regulators from exerting substantial efforts toward environmental protection in their regulation of land use. They have, in fact, been extremely active. Ask any developer.
The facts in SWANCC are straightforward. Needing a site for the disposal of non-hazardous solid waste, a consortium of 23 suburban Chicago cities and villages bought a 533 acre parcel that had, for decades, been the site of sand and gravel excavation by the Chicago Gravel Company. The fact that it was already excavated made it ideal for dumping solid waste.
But the fact that it was already excavated, joined with the fact that sand and gravel operations had ceased several decades ago, meant that rainwater sometimes accumulated in the depressions. And miscellaneous flora and fauna took up residence. SWANCC obtained all the permits it needed from state and local planning and environmental agencies, but the Army Corps of Engineers balked, claiming to act under its statutory jurisdiction, and refused to issue a permit to deposit fill into — are you ready — "navigable waters of the United States." Is an old quarry a "navigable water of the United States?" Yes, according to the Army, although the Navy may feel otherwise. But obviously the Corps acted as it did to maintain the scrubby environment in the abandoned gravel pit; it had nothing to do with navigability.
The question was whether the Corps had the jurisdiction to act at all. It claimed jurisdiction under the federal Clean Water Act. As Justice Stevens reminded everyone in his dissent, the Clean Water Act was a 1972 Congressional reaction to an unbelievable incident: The Cuyahoga River in Cleveland, Ohio had become so polluted that the river actually caught fire. That was sufficient to attract Congress' attention, and the resulting legislation was designed to clean up the nation's water — to the extent that Congress had jurisdiction to do so.
There were really two questions lurking in SWANCC. First, did Congress have the power under the Commerce Clause to authorize the Corps to regulate the kind of ponds and puddles that SWANCC intended to fill? Second, if so, did the statute authorize the Corps to enact the glancing goose rule? The District Court granted summary judgment to the Corps and the Court of Appeals affirmed, answering both questions affirmatively. Adhering to its practice of reaching constitutional questions only when necessary, the Supreme Court held that the statute did not authorize the regulation and reversed.
The key to the Court's analysis is that the statute authorizes the Corps to regulate the discharge of fill material into "navigable waters." Thus, to justify the Corps' attempt to regulate the use of mud flats and back yard ponds, it is necessary to classify them as "navigable waters." The broadest interpretation the Supreme Court has ever given to that jurisdiction was to extend it to wetlands adjacent to or otherwise affecting navigable waters. (United States v. Riverside Bayview Homes, Inc., 474 U.S. 121 [1985].)
The puddles involved in SWANCC had no connection to navigable waters. No one questioned that. And counsel for the government conceded at oral argument that the Corps' regulation was necessarily based on the assumption that the statute's use of the word "navigable" had little significance. The Court decided to take Congress at its word, demonstrating by the use of "navigable" its intent to invoke its traditional authority to regulate waters that are or could easily be made navigable in fact.
Plainly, that doomed the government's case. On the off chance that Congress might try to enact legislation specifically granting the Corps the authority it claimed, or enacting its own version of the glancing goose rule, the majority opinion seems clear that such legislation would not pass constitutional muster under the Commerce Clause if such an examination were forced.
The marvel is not that five Justices of the Supreme Court came to that conclusion, but that four of them actually argued that the presence of migratory birds is sufficient to make a quarry pit "navigable" and to invoke the constitutional power to regulate anything they touch as being involved somehow in interstate commerce. Were that so, of course, there would be nothing beyond the reach of federal regulation. Some people may think that's a good idea, but it isn't the system laid down in our constitution.
Ripeness Again — and a Little Something Extra
In Palazzolo v. Rhode Island, 533 U.S. 606 (2001) the Court explained to the Rhode Island Supreme Court that it wasted too much time and effort erecting roadblocks that prevented reaching the merits of the case. The more appropriate response, the High Court concluded, was to eliminate such barriers and examine the facts pragmatically so that disputes could be laid to rest.
The facts in Palazzolo were rather pedestrian, in the land use sense. In fact, they have become rather run of the mill examples of conflicts between those who want to develop land that they own and those who want to preserve it in its natural state for people other than its owners to enjoy.
Anthony Palazzolo owned some 22 acres of coastal land, approximately 18 of which constituted a salt marsh subject to tidal flooding, i.e., a classic wetland. In order to develop anything on the 18 wetland acres, it would be necessary to place fill material — as deep as six feet in some spots — in the marsh. Rhode Island balked. It wanted to preserve the wetlands as they were. Each time, it was clear that the reason for the denial was that the State did not want the wetlands filled. Thus, although Mr. Palazzolo may not have proffered numerous different plans about how he would develop the property if he could fill the wetlands, and although some of them may have been pretty simplistic in design (e.g., a gravel parking lot with a dumpster, port-a-johns, picnic tables, concrete barbecue pits and trash cans), the State's reaction was consistent: no filling.
So Palazzolo took his dispute to court. He lost at trial and he lost in the Rhode Island Supreme Court. But the U.S. Supreme Court gave him life. The primary issue dealt with in the lower courts had been what insiders call "ripeness," i.e., whether the case has progressed to a sufficient point that it can be litigated.
"Ripeness" has become the regulators' best friend. It is a concept that prevents judges or juries from ever considering the merits of their regulations, and it also permits judges to believe they are not actually harming the landowners. After all, if a case is determined to be unripe, that implicitly means that something can be done to ripen it and eventually a court hearing can be had. Realistically, however, the ripening process often takes so long that most landowners never get far enough to have that hearing in court.
Rhode Island thought Palazzolo hadn't sought enough different permits before going to court. Over the years, he had asked to fill all 18 acres or as few as 11 acres, but never less than that. The Rhode Island courts felt they could not presume that the state would automatically turn everything down.
Nonsense, said the U.S. Supreme Court. Six Justices believed that the answer to the ripeness riddle lies not in counting the number of applications, but in studying the bases for their denial. In the Court's words, "it is important to bear in mind the purpose that the final decision requirement serves." And that purpose is not to fill filing cabinets with paper, but to obtain some certainty about the government's intentions.
In Palazzolo, the High Court thought it clear that Rhode Island's intentions were to maintain the wetlands without adding fill. "[N]o fill for any ordinary land use. There can be no fill for its own sake; no fill for a beach club, either rustic or upscale; no fill for a subdivision; no fill for any likely or foreseeable use. And with no fill there can be no structures and no development on the wetlands. Further applications were not necessary to establish this point."
Pragmatism over formalism. If that message filters down from the Supreme Court to the state trial courts where these issues generally begin, then Palazzolo will have had a lollapalooza of an impact.
A second critical issue that the Court laid to rest had to do with timing. Recently, government agencies have had success convincing some lower courts that individuals who acquire land after stringent land use controls are already in place have no cause to complain and cannot challenge the constitutionality of those restrictions.
Palazzolo snuffed that line of reasoning. The Court was succinct. Sometimes, the Court said, "enactments are unreasonable and do not become less so through passage of time or title. Were we to accept the State's rule, the postenactment transfer of title would absolve the State of its obligation to defend any action restricting land use, no matter how extreme or unreasonable. A State would be allowed, in effect, to put an expiration date on the Takings Clause. This ought not to be the rule. Future generations, too, have a right to challenge unreasonable limitations on the use and value of land."
If the constitutional right in question were anything other than the right to make productive use of land, the issue would not have been deemed worthy of discussion. In Brown v. Board of Education, 347 U.S. 483 (1954), for example, the Court didn't waste time worrying about whether the schools had been segregated for so long that the present generation of parents and students shouldn't have standing to question the practice. Nor do First Amendment challenges get bogged down in such issues. As the Supreme Court put it recently, the rights of property owners protected by the Fifth Amendment are on a par with the other parts of the Bill of Rights and cannot be treated as some sort of "poor relation." (Suitum v. Tahoe Reg. Plan. Agency, 520 U.S 725 [1997].)
The reason that cases like this often get bogged down is that the underlying issues tend to polarize. Here, for example, the issue from the regulatory side was preservation of wetlands, with all the environmental overtones that accompany that issue. Those who supported the Rhode Island regulators did so with the zeal that can only be generated by true believers. And they believed that because their cause was just, the stultification of Mr. Palazzolo's land was proper. They saw the result of protecting the Fifth Amendment rights of landowners as somehow punishing the regulators for doing their job.
They need to take a step back. There is no punishment involved, even though money may have to change hands. All that the U.S. Supreme Court's decisions since First English and Nollan have demanded is fair treatment. And fairness to those who own the land requires that they not be called on to provide services for the rest of us at no cost. Those who benefit (i.e., the rest of us) ought to be the ones to pay.
Thus, although lawyers like to find well- and clearly-stated rules in judicial opinions, the result in Palazzolo may be both more palatable and more satisfying in the long run. Its clear message is that the courts, lawyers, and bureaucrats who work in the land use trenches should eschew technicalities and focus on the pragmatic. In that way, cases like this one will not take years to litigate and may, in fact, be resolved short of the courthouse. That's still a way off, but it is a worthwhile goal, and one that decisions like Palazzolo should help to bring about.
Moratoria and Temporary Takings
If you believe all you read, then the U.S. Supreme Court saved Lake Tahoe — agreed by all to be a national treasure — from environmental degradation. (Tahoe-Sierra Preservation Council v. Tahoe Regional Planning Agency, 535 U.S. 302 [2002].) That made for good headlines, but it was factual fantasy. The Tahoe-Sierra case was not about whether to protect environmental treasures. Don't be fooled by editorial commentary saying that it was. The only issue before the Court was how — in the context of a constitutional democracy — to engage in environmental protection and who should pay for it. Should it be society at large that benefits from draconian regulations, or should it be the faultless individuals whose property winds up in the path of these regulations?
The Court decided it was OK to make randomly selected landowners foot the bill so the rest of us could enjoy Lake Tahoe. I dissent — and so should you. You could be the next target of this kind of land grab.
The facts behind the headlines need to be understood. Lake Tahoe was changing. And the problem — a loss of some of the lake's storied clarity — was at least in part the increasing development in the area around the lake. California and Nevada decided they needed a new plan for development and preservation in the area and authorized the Tahoe Regional Planning Agency (TRPA) to prepare it.
To preserve the status quo, TRPA enacted a freeze on the development of land it considered hazardous to the lake's clarity. That was in 1981. The properties involved were quarter acre, single family lots in subdivisions that had already been partially developed. In other words, there were no large tracts involved. And these small lots were generally owned by different individuals. There were no major developers involved here, just moms and pops who wanted a home for vacation or retirement.
That initial freeze lasted two years. It wasn't enough. Two subsequent freezes (one formal, one informal) extended the period to 32 months. That brings the story down to 1984. At that point, TRPA adopted its new plan for the region. That new plan made the "temporary" freeze on these parcels permanent. However, because the rest of the 1984 plan granted additional development rights to others in the area, a federal court enjoined its operation. That injunction remained in effect until 1987, when TRPA adopted another plan. That one still exists today, and it continues to freeze virtually all of the lots that were involved in the Tahoe-Sierra litigation.
Twenty one years, and counting at the time of the decision. That is the "temporary" period that the individual victims of TRPA's planning activities have suffered. So the next time someone says the delay was "only temporary," keep in mind that the problem is definitional. A significant number of the people who began that litigation in 1984 died in that "temporary" interim.
So what did the Supreme Court think it was doing? Making the world safe for the planning community. The majority opinion is filled with generalities about the need for good municipal planning. But nothing is said about the resulting cost or who would have to bear it. For a decision by the so-called liberal, or progressive, wing of the Court, the opinion is curiously devoid of any concern for individuals. It is a bloodless, lifeless, soulless bureaucratic screed, callously nullifying cherished constitutional rights of individuals who have done nothing wrong.
This country is governed by a Constitution. That document outlines how our government functions and places parameters around its actions. In its Bill of Rights, the Constitution enumerates specific things that the government may not do. Importantly, the Bill of Rights is designed to protect individuals against the overreaching actions of even well-intended government agencies. Nothing in the Bill of Rights so much as hints at protecting the government (or the general collective) against the exercise of constitutional rights by individuals.
One of the cornerstones of the Bill of Rights is the protection of the rights of those who own property. The importance of that protection cannot be overstated. Throughout history, countries in which private property was protected have flourished. Those in which it was not have languished — or worse.
This country has long gotten past the idea that the Fifth Amendment's protection of private property from uncompensated takings is limited to actual physical seizure. The reality of the modern regulatory state is what prompted Justice Oliver Wendell Holmes, Jr. to conclude for the Court some eighty years ago that when land use regulation "goes too far" the courts will recognize it as a taking of property that must be compensated.
In the Tahoe context, that should have required looking at the reality of what TRPA did to these hundreds of landowners who were frozen out to preserve the aesthetic sensibilities of the rest of us. Twenty one years and counting. No use, and no ability to sell to anyone else for anything approaching fair value. After all, who buys land that cannot be used? Answer: government scavengers who pick up these lots at distress, below-market prices in violation of the "just compensation" guarantee.
The Supreme Court failed this test of constitutional courage. Faced with a clear preclusion of all use of these lots for decades, the Court first wrote its own issue to be decided, thus slicing the period of denial of use so that it could deal with only a mere 32 month period, and then concluded that it could not develop any hard and fast rules for 32 month periods.
With respect, that result ignores both the Constitution and reality. For all the platitudes about the need for planning, this case was solely about ends and means. No one challenged the end of preserving Lake Tahoe. The only question was how that would be done. The Supreme Court decided that preservation of this national treasure for the benefit of the rest of the country (not to mention those who are already enjoying their homes and businesses around the lake) would be funded on the backs of these randomly selected individuals who simply hadn't gotten around to pulling building permits before the curfew bell rang.
To all those who believe this is a good idea, keep looking over your shoulder. The next one who gets caught by the planners' pet idea du jour could be you. For, as the liberals who cheer this opinion never tire of telling us, when the constitutional rights of one class of persons are not secure, neither are the rights of anyone else. It's only a question of time.
Like "Kissing Your Sister," But Nonetheless a Decision
There's something extremely unsatisfying about a 4-4 vote in the Supreme Court. But Justice Kennedy sat out Bordon Ranch Partnership v. U.S. Army Corps of Engineers, 123 S.Ct. 599 (2002), and the others were evenly divided. That resulted in affirmance of the decision in Bordon Ranch Partnership v. U.S. Army Corps of Engineers, 261 F.3d 810 (9th Cir. 2001).
So it is now the law of the land that a farmer plowing his field (in this case, a technique called "deep ripping" to break up hardpan beneath the surface so the land would drain properly) can be guilty of discharging pollutants into waters of the United States (i.e., the plow brought up dirt and it fell back into an area deemed wetlands by the Corps) and fined $25,000 for each pass of the plow. If you want the details, read the divided Court of Appeals decision. The decision seems in direct conflict with National Mining Assn. v. U.S. Army Corps of Engineers, 145 F.3d 1399 (D.C. Cir. 1998), which probably accounted for the divided Supreme Court, as it clearly accounted for the divided 9th Circuit.
Use of Referendum in Planning and Zoning
In City of Cuyahoga Falls v. Buckeye Community Hope Foundation, 538 U.S. 188 (2003), the city submitted to the voters a referendum on whether to repeal an ordinance authorizing construction of a low-income housing complex. The 6th Circuit Court of Appeals found factual issues regarding discriminatory intent, and wanted trial of equal protection, due process, and Fair Housing Act claims. The Supreme Court reversed.
A referendum that is, on its face, neutral, does not violate equal protection. Nor was there any substantive due process problem with submitting such an issue to the voters as the city charter required. Indeed, the Court found that the referendum process advanced protected 1st Amendment rights. As the challengers complained only about the act of submitting the issue to the voters, and not the result of the referendum, the substantive outcome was not before the Court.
Takings and "Mere" Money — Again
As noted earlier, the Court dealt with the application of the Takings Clause to the taking of money, rather than some other kind of property, in Eastern Enterprises, with a plurality concluding that a taking occurred and Justice Kennedy providing the fifth vote because he found the process fundamentally unfair and agreed it should be banned on due process grounds.
Money reared its head again in the context of lawyers' trust funds, and the process generally referred to as Interest on Lawyers' Trust Accounts (or IOLTA, because we like acronyms) to fund legal services for the poor. (Brown v. Legal Foundation of Washington, 123 S.Ct. 1406 [2003].)
The lawyers among you all know the drill: money you hold for clients that is either too small or being held for too short a time to generate interest sufficient to cover the cost of a separate trust account is pooled and the interest sent to a state agency to pay for legal aid to the poor. The Washington Legal Foundation and two individuals brought suit to declare this a violation of the 5th Amendment because it plainly took private property for public use and provided nothing to the property owners.
The case is a follow-up to Phillips v. Washington Legal Foundation, 524 U.S. 156 (1998), in which the Court plainly held that such interest is the private property of the owners of the principal. That case left open the question addressed in Brown: "So what?"
According to the Supreme Court, "So, nothing". In an opinion based on the legal concept of "no harm, no foul," the Court's majority concluded that because the owners of the interest could not ever have used it, they were not harmed and thus no compensation was due them. Apparently there is hidden writing in the 5th Amendment, invisible to most of our naked eyes, that makes the Just Compensation Clause read: "nor shall the net value of private property be taken for public use without just compensation." (Emphasized added, if you didn't realize that.)
While treating the case as a per se physical taking, the Court again emphasized its devotion to the Penn Central mode of analysis in regulatory takings.
Most curious — and perhaps most far-reaching for 5th Amendment jurisprudence in the long run — was the Court's discussion of "public use." Although no one had raised a question about public use, the Court's majority concluded that the public use limitation on eminent domain was "unquestionably satisfied." The analysis is better quoted than paraphrased:
"If the State had imposed a special tax, or perhaps a system of user fees, to generate the funds to finance the legal services supported by the Foundation, there would be no question as to the legitimacy of the use of the public's money."
If that's the test, is there any public use limitation remaining? The dissenters thought not. In their words, "This reduces the 'public use' requirement to a negligible impediment indeed, since I am unaware of any use to which state taxes cannot constitutionally be devoted." (Emphasis in original.)
Whether that dictum becomes law remains to be seen. Read on.
Cases To Be Decided In The Current Term
As of this writing (October, 2004), there are four cases to keep track of. Stay tuned for later additions and the outcomes of these.
"Public Use" in Eminent Domain
Eminent domain has been called the state's "most awesome grant of power" to municipalities because it enables them to compel private citizens to sell property that they may not wish to sell, at a time of someone else's choosing, and on terms set either by the buyer or by a court. (See City of Oakland v. Oakland Raiders, 174 Cal.App.3d 414, 419 [1985]; Winger v. Aires, 89 A.2d 521, 522 [Pa. 1952].)
Concededly, the idea of "public use" has blurred from the obvious original intent that eminent domain be used to acquire property solely for public works like government offices, schools, highways and the like. In its first look at urban redevelopment laws, the U.S. Supreme Court agreed that eliminating "blight" was a sufficient public use to invoke this power. (Berman v. Parker, 348 U.S. 26 [1954].) Once "blight elimination" (or "slum clearance," as it was more openly called at the time) is accomplished, the government's disposition of the property to private redevelopers is irrelevant. The California Supreme Court, under rather unique circumstances, found nothing amiss in using the power to condemn a football team to play in the public stadium built for it years earlier. (City of Oakland v. Oakland Raiders, 32 Cal.3d 60 [1982].) And the U.S. Supreme Court's only other foray into this issue dealt with the peculiar manner of land title holding in Hawaii. (Hawaii Housing Auth. v. Midkiff, 467 U.S. 229 [1984].)
At one extreme, the Michigan Supreme Court issued a controversial decision a quarter-century ago that seemed to loosen the floodgates not only there but elsewhere. The decision in Poletown Neighborhood Council v. Detroit, 304 N.W.2d 455 (Mich. 1981) allowed government agencies to condemn private property for the sole purpose of handing it over to a private business for a different use. In plain English, economic development would suffice to satisfy the constitutional requirement that the power of eminent domain be used only to convert land from private use to public use — even when the new use was not even nominally "public."
Poletown destroyed 1200 households, 16 churches, more than 100 businesses, a U.S. post office, and a 278-bed hospital. (See Armond Cohen, Poletown, Detroit: A Case Study in "Public Use" and Reindustrialization [Lincoln Inst. of Land Policy 1982].) The reason? General Motors wanted to build a new Cadillac assembly plant and threatened to build it in another state — leaving "Motor City" without one of its signature industrial sites. Detroit eventually spent some $200 million assembling and razing the site, and then sold it to GM for $6.5 million. For this, GM promised 6000 new jobs. Reality is that no more than 3000 ever materialized. But Poletown — along with its structures of both historical and architectural significance — is now history.
But the idea of taking property that is not otherwise blighted or infirm, simply to allow different citizens to use it has not been universally cheered. A California court, for example, recently overturned a scam to designate much of the resort town of Mammoth Lakes as "blighted," so it could be "redeveloped" — using condemnation power where necessary — into a more profitable recreational community. (Friends of Mammoth v. Town of Mammoth Lakes Redevelopment Agency, 82 Cal.App.4th 511 [2000].)
The Illinois Supreme Court likewise ended a scheme in which a local development authority openly advertised that it would use its power of eminent domain to acquire property when a prospective developer was unable to buy all the land needed for the project. Refusing to allow government agencies "to act as a default broker of land . . . ," the court held the practice unconstitutional. (Southwestern Illinois Development Auth. v. National City Environmental, 768 N.E.2d 1 [Ill. 2002].)
This is a terribly controversial legal area. Detroit was not alone in its expansive use of condemnation in aid of commercial development. Yonkers, New York, for example, used its power to condemn land to accommodate expansion plans of the Otis Elevator Company. (Yonkers Redevelopment Agency v. Morris, 335 N.E.2d 327 [N.Y. 1975].) A few years later, Otis Elevator changed its mind, left town anyway, and left the city holding a very empty bag. (City of Yonkers v. Otis Elevator Co., 844 F.2d 42 [2d Cir. 1988].)
The Michigan Supreme Court recently overturned Poletown (see County of Wayne v. Hathcock, 684 N.W.2d 765 [Mich. 2004]), holding that Poletown's conclusion that, because "generalized economic benefit" was in the public interest, acquisition of private property to transfer title to someone who promised to make a "better" economic use was the same as a "public use," could not pass constitutional muster. It had been, said the court, "a radical and unabashed departure from the entirety of this Court's . . . eminent domain jurisprudence." Consequently, "we must overrule Poletown in order to vindicate our Constitution, protect the people's property rights, and preserve the legitimacy of the judicial branch as the expositor — not creator — of fundamental law."
The issue is ripe for coherence. In the Connecticut case pending review this Term, that State's Supreme Court examined the same issue as Michigan and, by a 4-3 vote, reached the opposite conclusion. (Kelo v. City of New London, 843 A.2d 500 [Conn. 2004], cert.granted, No. 04-108.) There, the City of New London concluded that replacing a working class residential and commercial area with 90 acres of industrial park and office space would be better for the city's economic prospects. The project was projected to generate 700 to 1300 new permanent jobs, in addition to construction jobs and indirect employment away from the building site. Property tax revenues were predicted to be a million dollars, plus or minus. On the other side of the ledger, after displacing the current residents, and paying the court ordered compensation, the city would lease it to the redeveloper for 99 years at a rental of $1 per year.
We're about to find out whether the same constitutional guarantee means the same thing in Connecticut that it does in Michigan. Or elsewhere. This seems one of those central issues on which there ought to be national uniformity.
Agins Prong One Revisited
The 9th Circuit decided a case called Chevron USA, Inc. v. Bronster, 363 F.3d 846 (9th Cir. 2004), referred to as Chevron II, because the case had made an earlier Ninth Circuit appearance resulting in a remand. (See Chevron USA, Inc. v. Cayetano, 224 F.3d 1030 [9th Cir. 2000] [Chevron I].) There will now apparently be a Chevron III, as the Supreme Court granted cert. in Chevron II, under the name Lingle v. Chevron USA, Inc., No. 04-163.
The case involved a state statute regulating the maximum rent an oil company can charge dealers who lease its service stations. The legislature said it wanted to do so to reduce gasoline prices. After trial, the District Court found that the statute would have the opposite effect, i.e., it would cause gasoline prices to rise.
In the Chevron litigation, the lower courts applied one of two alternative tests to determine whether government regulation violates the Takings Clause, an alternative that has been oft-repeated by the Supreme Court since its initial announcement in Agins v. City of Tiburon, 447 U.S. 255 (1980).
In Agins, the High Court declared that a government regulation effects an unconstitutional taking if it either fails to substantially advance a legitimate state interest or denies the owner economically viable use of land. Thus, in order to pass constitutional muster, government regulation must satisfy both prongs of that test. If a property owner shows a governmental failure on either hand, the regulation is struck down (if it fails to substantially advance legitimate government interests), or compensation is awarded (if it is otherwise legitimate, but denies economically viable use). Chevron turns on the first prong of that alternative test, as the District Court found as a fact that the statute would achieve the opposite of its objective..
Some have complained about Agins' first prong, saying it allows “second-guessing” of elected officials, something don't like. That raises two questions. First, does the rule allow “second-guessing”; and second, is there something wrong with that? The answers, respectively, are yes and no, although its not really “guessing,” as evidence and legal analysis are involved.
Constitutionally, government is not allowed to operate “half-cocked.” Although it has always been true that legislatures are not forbidden to enact stupid laws (because the remedy is to throw the rascals out at the next election), constitutional constraints exist. Remember, this country was founded by people who revolted against a governing class that thought its decisions were unreviewable.
Thus, the concept of “no second-guessing” doesn’t fit our constitutional system — and never did. As the Pennsylvania Supreme Court classically put it, “The genius of our democracy springs from the bedrock foundation on which rests the proposition that office is held by no one whose orders, commands or directives are not subject to review.” (Winger v. Aires, 89 A.2d 521 [Pa. 1952].)
Indeed, this very question was directly presented to the U.S. Supreme Court only a few years ago. The first question presented by the city’s certiorari petition in City of Monterey v. Del Monte Dunes, 526 U.S. 687 (1999) was: “Whether liability for a regulatory taking can be based upon a standard that allows a jury or court to reweigh evidence concerning the reasonableness of the public entity’s land use decision.” In other words, could a trial court “second-guess” a governmental decision?
The Supreme Court’s answer was crisp and clear: “To the extent the city argues that, as a matter of law, its land-use decisions are immune from judicial scrutiny under all circumstances, its position is contrary to settled regulatory taking principles. We reject this claim of error.”
Moreover, a group of amici curiae — led by the U.S. Solicitor General, whose views generally attract the Court’s attention — urged the Supreme Court to address and overturn the “substantially advance” prong of Agins when it decided Del Monte Dunes. The Court refused. Beyond that, the Court affirmed the judgment, necessarily affirming the trial court’s instructions to the jury and the jury’s conclusion that the evidence showed that the city’s decision precluding development failed to substantially advance a legitimate state interest — resulting in an unconstitutional taking.
Is there a place for judicial deference to government? Certainly. When land is condemned, for example, the determination that the land is needed for a public use and that particular land is necessary for the project is entitled to deference. (Hawaii Housing Auth. v. Midkiff, 467 U.S. 229 [1984].) However, that deference does not carry over when a regulation is challenged as a taking of property. The reason is that when government decides to condemn property, it concedes liability and the only issue is the amount of money that taking will cost.
By contrast, when government regulates in a harsh manner that is challenged as a taking, liability is denied by the government and must be determined in court. As the Supreme Court too pains to point out in Del Monte Dunes, government denial of liability changes the litigation markedly, and the deference owed the initial decision declines accordingly.
When government legislates broadly, it is also entitled to deference. (See City of Euclid v. Ambler Realty Co., 272 U.S. 365 [1926] [upholding new general city zoning ordinance].) When, however, government targets an individual or a small group, the matter is otherwise. In Chevron, the legislation (no matter how generally worded) was plainly aimed at a discrete target. Otherwise, the legislature would not have justified the statute on the need to rein in oligopoly and ensure continued competition in a specific industry.
The issue that will be heatedly argued in Chevron III is whether to keep the Agins prong 1 test as a takings test. Hawaii argues that this is really a due process test, not a takings test, and that it is apparently willing to be judged as a matter of due process, but not as a matter of takings law.
Why? If it is the same test, what does it matter which clause of the 5th Amendment controls? Plenty. The operative phrase is "standard of review." The standard which the government must meet to defend against a due process charge is very low. Some have openly referred to it as "the idiot test," as only an idiot could fail to satisfy it. Takings law has used a somewhat higher standard of scrutiny. For illustration, examine the procedural and factual background of Del Monte Dunes. The landowner had claimed both a regulatory taking and a substantive due process deprivation. The trial judge submitted the former to the jury while retaining the latter for himself. The jury found a taking; the judge found no substantive due process problem. On post-trial motions, the judge also found nothing inconsistent about those results.
Those on Hawaii's side refer back to the Eastern Enterprises opinions noted earlier, taking heart that the Court will do away with half the Agins test and relegate it to the due process realm. If the Court would actually apply a meaningful due process review, one that subjected regulations to some sort of scrutiny, rather than abjectly deferring to whatever choice a legislative body makes, then it would be no problem for those who are regulated adjusting to that regime. The problem is that, if the review bar remains only barely above the ground, then it will, as the Court put it in Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1025, fn. 12 (1992) "amount[] to a test of whether the legislature has a stupid staff." Any staff worth its salary ought to be able to satisfy a standard due process test. That is why government likes the test and those who are regulated believe it is generally toothless.
Water Rights, Contracts, and Takings
Orff v. United States, 358 F.3d 1137 (9th Cir. 2004), cert. granted No. 03-1566, involved a 1963 contract between the federal government and the Westlands Water District in California for the delivery of water from the massive Central Valley Project. In turn, Westlands distributed the water to individual farmers. In 1993, the government slowed the tap. It cut water deliveries in half.
The government's action was the result of choosing between two conflicting duties. Under the Westlands contract, the government had a duty to deliver a specified amount of water on an agreed schedule. Under the Endangered Species Act (ESA), the government had a duty to protect the winter-run Chinook salmon and the Delta smelt, both of which had been classified as "threatened" under the ESA. In short, the water needed to be shared. To protect the fish, the government sent the Water District only half its allotment. The farmers sued for breach of contract, claiming third-party beneficiary status.
The farmers thought they were in pretty good legal shape. This wasn't the first time the government had reneged on this very contract. The first time resulted in a 1986 stipulated judgment requiring the government to perform its contractual duties.
But the farmers were wrong. The 9th Circuit held that notwithstanding the 1986 judgment, the contract itself unambiguously absolved the government for failure to deliver the full contractual amount of water where there is a shortage caused by a statutory mandate. Beyond that, the Court held that sovereign immunity precluded any suit by the farmers even to challenge whether the ESA had been properly applied.
To have standing to challenge the government's action, the farmers would have to have qualified as parties to the contract. They were not. Their last line of defense was that they were third-party beneficiaries of the contract. No good. The court said that such beneficiaries come in two flavors, "intended" and "incidental." Only the former would have standing to sue. The farmers were held to be the latter.
So, was there any remedy possible? Could be. When the district court dismissed the suit, it noted that jurisdiction for damage claims lay in the Court of Federal Claims, under the Tucker Act, and thus the district court had no jurisdiction to hear them.
The Supreme Court granted certiorari to resolve the third-party beneficiary issue. If that Court agrees with the 9th Circuit, presumably the farmers could seek redress in the Court of Federal Claims, a suit that could put the ESA at risk — something the government has assiduously avoided in the past.
Federal Statutory Rights and 42 U.S.C. § 1983
Initially, the decision in Abrams v. City of Rancho Palos Verdes, 354 F.3d 1094 (9th Cir. 2004), cert. granted sub nom. City of Rancho Palos Verdes v. Abrams, No. 03-1602, could appear to be of limited interest, involving the municipal authority over permits for ham radio towers. But the 9th Circuit holding goes beyond backyard radio towers. That court held that municipal violation of rights granted by the Telecommunications Act of 1996 paved the way for payment of damages under the Civil Rights Act, 42 U.S.C. § 1983. Section 1983's reach ought to be of interest to all.
Abrams had a permit to use his tower in an amateur setting. He also used it commercially. When the city learned of this, it obtained an injunction pending application for a conditional use permit. When asked, the city denied the permit. Thus, this suit.
The District Court found that the city violated the Act, but concluded that the Act contained a comprehensive remedial scheme, impliedly precluding damages under § 1983. The 9th Circuit disagreed. That conclusion conflicts with the decision in Nextel Partners, Inc. v. Kingston Township, 286 F.3d 687 (3d Cir. 2002). The conflict between the Circuits was squarely presented in the cert. petition, and may well have provided the impetus to take the case for review.
In any event, elucidation on the availability of damages under § 1983 appears to be in the offing.