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Thursday, June 17, 2010

Supreme Court Rules in Stop the Beach

450px-Destin_Beach_Florida_100_1107 The Supreme Court today ruled in the Stop the Beach judicial takings case.  In an opinion by Justice Scalia, the Court rejected the judicial takings claim.  The Court's judgment was unanimous, but there were fragmented opinions on various issues, as described further below.  For background on the case, see this post.  For a recap of the oral argument, see this post.  For a great description of the social conflicts behind the dispute, see this article from the New York Times Magazine

I will be updating this post with analysis of the Court's opinions and with links to commentary about the case.

A Quick Summary of the Opinions

Justice Scalia delivered the Opinion of the Court, which was unanimous, for Parts I, IV, and V.  These parts together hold that the Florida Supreme Court's opinion was sufficiently consistent with Florida caselaw that the takings claim should be rejected.  Justice Scalia's opinion, however, is not the Opinion of the Court for Parts II and III.  These Parts reach the issue of judicial takings, and assert that under the correct circumstances, a judicial action can violate the takings clause.  Justice Scalia was joined in these Parts by the Chief Justice and Justices Thomas and Alito.  Justice Stevens did not participate in the case (because he owns Florida beachfront property), and the four other Justices (Kennedy, Ginsburg, Breyer, and Sotomayor) declined to join in Parts II and III of Justice Scalia's opinion.  Justice Kennedy wrote a concurring opinion, joined by Justice Sotomayor, and Justice Breyer wrote a concurring opinion, joined by Justice Ginsburg.  Together, these concurrences suggest that it was unnecessary to reach the issue of whether it is ever possible to have a judicial taking.  So on this critical issue, the Court split 4-4.  Because of the tie, Justice Scalia's opinion is not controlling precedent on this issue.  The overall issue of whether there can ever be a judicial taking is therefore still open as a matter of Supreme Court caselaw. 

Analysis

(1) What is the standard for judicial takings?  As noted above, the big question of whether there can ever be a judicial taking is still open.  If the ultimate answer to this question proves to be "yes", what would be the standard for deciding whether there is a judicial taking?  Four justices objected to even considering this issue, but Justice Scalia's opinion proposes the following standard:  "If a legislature or a court declares that what was once an established right of private property no longer exists, it has taken that property . . ." (Slip op. at 10, emphasis original).  Later in his opinion (at 23), Justice Scalia rejects the standard suggested by Justice Stewart's Hughes v. Washington concurrence that a decision that "constitutes a sudden change in state law, unpredictable in terms of relevant precedents" would be a taking. So the focus of Justice Scalia's proposed standard is on whether there is an established right of private property, not on whether the outcome was predictable.  There might often be a congruence between clear establishment of a right and predictability of an outcome, but Justice Scalia gives a few examples (at 23-24) where that might not be the case.

(2) What is the future of judicial takings litigation?  One fear about allowing judicial takings is that the federal courts will become the courts of last resort for property disputes.  Justice Scalia suggests that a litigant who loses before a state supreme court can only raise a judicial takings challenge through a cert petition to the United States Supreme Court. (Slip op. at 23).  But property owners who were not a party to the original litigation could challenge the state supreme court's decision as a judicial taking in the lower federal courts:  "And where the claimant was not a party to the original suit, he would be able to challenge in federal court the taking effected by the state supreme-court opinion to the same extend that he would be able to challenge in federal court a legislative or executive taking previously approved by a state supreme-court opinion." (at 23).  I am not at all an expert on Williamson County and San Remo, so I can't yet fully evaluate the impact of this statement.  And, of course, Justice Scalia's opinion is not binding on this point.  But Justice Scalia certainly seems to invite property owners to (a) bring cert petitions claiming judicial takings if they lose in state supreme court; even though cert petitions have a low chance of being granted, a petition claiming a judicial taking would get a sympathetic read from at least some of the Justices' chambers; and (b) bring lower court judicial takings cases if they were not litigants before the state supreme court.  These invitations, combined with the lack of clear guidance on any of these issues from the Court, suggest that we will see a lot of litigation on these issues in the near future.

[UPDATE:  Some further thoughts about the litigation that we're likely to see.  First, I think that state supreme courts might be especially careful after Stop the Beach to paper up their property opinions well.  As the actual outcome in Stop the Beach showed, state property law often allows a substantial amount of wiggle room.  Another way of putting this is that state law property rights might not always be as clear as many people suppose.  Second, it may be that the statute of limitations has not yet run on judicial takings claims based on some recent state supreme court decisions.  I don't have any specific case in mind, but property owners who were not parties to the initial litigation might start bringing claims in the lower federal courts.  Third, although the denial of cert would preclude a takings claim by the litigant in the state supreme court, the cert denial would have no precedential value, so every cert denial in a judicial takings case might be followed by claims brought in the lower federal courts by similarly situated property owners.  Fourth, these claims are going to be very challenging for the lower federal courts.  Not only is the standard for judicial takings unclear, but the procedural propriety of bringing judicial takings claims in the lower federal courts is not even clear -- Justice Scalia suggested that these claims could be brought, but his opinion is not controlling precedent on this point.  It could turn out in some case down the road that these kind of claims cannot be brought in federal court.  Faced with this mess, lower federal courts would do well to do what the Supreme Court ultimately did in Stop the Beach:  look for some precedential support for the state supreme court opinion that is being challenged, and reject the constitutional challenge.] 

(3) Justice Kennedy's concurrence could be very important.  Justice Kennedy raises a number of interesting issues in his concurrence.  I want to focus for now on just one.  Consistent with his approach in a number of other takings cases, Justice Kennedy has advocated for a relatively robust role for due process analysis.  The most important statement in Justice Kennedy's concurrence might be this:  "The Court would be on strong footing in ruling that a judicial decision that eliminates or substantially changes established property rights, which are a legitimate expectation of the owner, is 'arbitrary or irrational' under the due process clause." (Slip op at 4).  Like Justice Scalia's proposed judicial takings test, this one focuses on clearly established property rights.  So it is possible to count six votes for the proposition that a state supreme court opinion that eliminates clearly established property rights is unconstitutional:  the Chief Justice and Justices Scalia, Thomas, and Alito on judicial takings grounds, and Justices Kennedy and Sotomayor on due process grounds.  I also think it is very interesting that Justice Sotomayor joined Justice Kennedy's opinion, rather than Justice Breyer's.  This may be a hint that Justice Sotomayor may be more protective of property rights than many of the Court's liberal justices have been over the last few years.  It is worth remembering in this context that both Justice Brennan and Justice Marshall wrote a number of takings opinions that were very pro-property owner (e.g., the San Diego Gas & Electric dissent by Justice Brennan, the Loretto opinion by Justice Marshall).

(4) Justice Stevens may have been missed by the pro-government side.  Justice Stevens has been the intellectual leader of the pro-government side on regulatory takings issues since at least 1987.  This is speculation (though informed speculation), but I would have expected Justice Stevens to have made the case against recognizing a doctrine of judicial takings had he not recused himself.  Justice Breyer was satisfied with making the case that this issue shouldn't be decided now.  I think that Justice Stevens would have said more. [UPDATE:  Tony Mauro at the BLT has some additional thoughts on the impact of Justice Stevens' recusal].

(5) Potential impact on the broader regulatory takings issue.  There are two notable things about the plurality portion of Justice Scalia's opinion for regulatory takings more broadly.  First, it continues to emphasize the concept of equivalence that has been a theme in recent regulatory takings cases.  By "equivalence" I mean the idea that a regulation or other government action is a taking if it is the equivalent of an exercise of eminent domain.  (See slip op. at 8).  This idea was a major theme in Lingle v. Chevron.  I think that this is a potentially important concept in that it may circumscribe the scope of regulatory takings - regulations that lead to a total diminution in value of property are easy to equate to an exercise of eminent domain; regulations that result in a lesser diminution in value seem much less like the equivalent of an exercise of eminent domain.  Second, Justice Scalia's opinion includes a shot across the bows of state supreme courts that might want to use the background principles exception from Lucas to insulate a regulatory action from a takings claim.  After quoting the relevant language from Lucas, he states that "A constitutional provision that forbids the uncompensated taking of property is quite simply insusceptible of enforcement by federal courts unless they have the power to decide what property rights exist under state law." (Slip op. at 22).  In other words, in Justice Scalia's view, federal courts shouldn't be too deferential to state court characterizations about the scope of property rights.

(6) Some classic Scalia.  In taking on Justice Breyer's argument that there was no need to address the core judicial takings issues, Justice Scalia makes a reference to a classic tongue twister:  "JUSTICE BREYER must either (a) grapple with the artificial question of what would constitute a judicial taking if there were such thing as a judicial taking (reminiscent of the perplexing question how much wood would a woodchuck chuck if a woodchuck could chuck wood?) or (b) answer in the negative what he considers to be the 'unnecessary' constitutional question whether there is such a thing as a judicial taking."  Justice Scalia treats the question of the woodchuck as open, but it of course has an answer:  a woodchuck would chuck as much wood as a woodchuck could chuck if a woodchuck could chuck wood.

(7) The Euclid cameo.  Michael Allan Wolf, who knows a lot about Euclid, just pointed out to me that Justice Scalia badly miscites Euclid - see the slip opinion at p. 12, describing Euclid in a parenthetical as "recognizing that block zoning ordinances could constitute a taking, but holding that the challenged ordinance did not do so."  As Michael pointed out, this is clearly wrong on a number of levels.  Most importantly, in my humble opinion, is that Euclid is not a takings case.  It is a substantive due process case, as Justice Kennedy suggests in his concurrence (slip op. at 3).  I really don't think that it is helpful to Justice Scalia's broader agenda to treat Euclid as a takings case, and in any event it is simply wrong to do so. 

A couple of random points.  First, in my first big post about this case, I wrote:  "I would guess that Justice Scalia was instrumental in obtaining the cert grant.  I predict that the Supreme Court will find a taking in Stop the Beach and that Justice Scalia will write the opinion of the Court."  Well, I was at least half right.  My predictions after oral argument were a little more on target re: the outcome.  Second, it has frequently been observed that blogs have compressed the cycle of analysis on Supreme Court opinions.  Having just tried to put together some cogent thoughts in about three hours really drove that point home for me.  Third, Justice Scalia showed academics no love at all, and did not cite the leading law review articles on judicial takings.  Justice Kennedy did cite some, but not all, of the leading articles on point.  Fourth, I noted before that I advocated in the past (albeit as a law student) for federal judicial takings review of state court property decisions.  Here is what I said in my student note (63 Fordham L. Rev. at 1881-82) on the judicial takings standard: 

The Court should explicitly adopt Justice Stewart's Hughes v. Washington test, while avoiding the problematic "reasonable expectations."  State court findings in just compensation cases should be reviewed to ensure that they define property using legitimate statutory and common law precedent, rather than using the inherent flexibility of common law to define property rights out of existence.  If the state courts previously have recognized a property interest, either between private individuals or between an individual and the state, then the state cannot destroy that interest without compensation.  Such a requirement would accommodate the desire to have the state's property law serve as the primary source of the definition of property, while maintaining the protection of liberty required by the Just Compensation Clause.

This is somewhat close to the standard that Justice Scalia proposed, which is kind of cool.  The problem is that I'm not sure that I still agree with what I said as a law student.  I'll have to sort that out sometime soon.

Further thoughts on the case from around the blogosphere and the media (to be updated periodically):

Lior Strahilevitz has a thoughtful analysis of the question raised by Jerry Anderson (on the property listserv and in the comments here) at the University of Chicago Law School Faculty Blog.

Timothy Sandefur comments on the case at the Pacific Legal Foundation's blog. [UPDATE:  Tim has a second post with some further thoughts on the case.]

Josh Blackman is happy that Justice Sotomayor may be more protective of property rights than Justices Breyer or Ginsburg.

Robert H. Thomas collects some links at the Inverse Condemnation Blog.

Ilya Somin comments on the case at the VC.

David Bernstein comments on the substantive due process aspects of the case at the VC here and here.

Ilya Shapiro of the Cato Institute discusses the case.

NPR's Nina Totenberg has a story on the case.

Steve Eagle comments here at PropertyProf.

UPDATING the list of commentary a few days later:

Eduardo Penalver has some excellent thoughts at Prawfs.

Tim Mulvaney has an op-ed on the case.


Ben Barros

[photo of Destin, Florida beach via Wikicommons]

[Comments are held for approval, so there will be some delay in posting]

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Comments

I am curious about Justice Scalia's position that courts may not eliminate "established private property rights." What do such rights consist of? For example, assume that a state court decides to move from a "good faith" approach to adverse possession to an "objective" standard, which will allow some possessors to prevail, even though they knew the land they were occupying was not theirs. This is a standard "evolution" of common law, yet it does, under Justice Scalia's rigid formulation, result in a party losing property that it would not have lost under the old common law test. Is that a "taking"? Can the court NOT change such a common law test without having to compensate property owners?

Posted by: Jerry Anderson | Jun 17, 2010 8:25:57 AM

I was quite surprised by Justice Scalia's apparent rejection of the principle that the payment of just compensation is the appropriate remedy for any taking of private property under the Fifth Amendment. He notes, for example, that compensation "is rare even for a legislative or executive taking, and we see no reason why it would be the exclusive remedy for a judicial taking." (at 18) Instead, he asserts that reversal of the challenged decision would be the proper remedy. At least with respect to the remedial issue, I think Justice Kennedy's approach (invalidating judicial abrogations of property rights under due process) is a far better approach.

Posted by: Jeff | Jun 17, 2010 10:10:35 AM

Great post, Ben! Very informative.

Posted by: Mike Kent | Jun 18, 2010 6:14:22 AM

Was anyone else suprised by Justice Scalia's lack of references to established elements of takings law in laying out his proposed standard for a judicial taking? No discussion of whether this supposed species of taking would be governed by Loretto, Lucas, or Penn Central. And what of the parcel as a whole rule, which would appear to be especially pertinent in this case? It is not as if the parties and their amici did not discuss the potential relevance of these precedents and the parcel rule at length. Is Scalia indicating his personal preference for jettisoning most of established precedent? Or does he implcitly believe that judcial takings are different and should be subjected to a different and higher standard, notwithstanding the statement that claimed takings by all different branches of government are the same?

Posted by: John echeverria | Jun 21, 2010 7:00:43 AM

John, I've been thinking about that as well. There is a lot in the opinion that suggests that the judiciary should be treated the same as the other branches of goverment. If that is the case, then you would think there should be some reference to the other tests. On the other hand, if you take the idea of equivalence to eminent domain as the overarching theme of the other tests, then a test based on destruction of a property right seems consistent.

Posted by: Ben Barros | Jun 21, 2010 7:55:26 PM

Justice Kennedy's suggestion (due process) is a good one, but is not exhaustive--and may not be applicable--where elected state jurists exhibit a collective animus towards a property right. Of particular interest is the judicial takings that occurred in the Snake River Basin Adjudication resulting in the extirpation of water rights reserved under federal law for tribes, wilderness areas, wild and scenic rivers ...

Posted by: charles pace | Aug 1, 2010 11:17:48 AM

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