"[L]and-use regulation does not effect a taking if it 'substantially advances legitimate state interests' . . . ."
Lucas v. South Carolina Coastal Council
Petitioner bought two residential lots for $975,000 to build single-family homes, but two years later, the South Carolina legislature passed a law to protect beaches which prevented petitioner from building any permanent habitable structures on his land. The trial court found that this rendered them valueless. Petitioner conceded the state's power to enact such restrictions, but sued for compensation in for this "taking."
Trial court found for petitioner and awarded him $1,232,387.50 in damages.
Supreme Court of South Carolina reversed, finding that since the act was validly designed to preserve the state's beaches, it had to be accepted in whole, including not paying for its drastic effects on property values.
Does an environmental law that renders a property valueless constitute a taking under the Fifth and Fourteenth Amendments?
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While generally no rule exists for how far is too far for regulations to constitute a taking, regulatory actions are compensable without case-specific inquiry in two scenarios:
- Where regulations compel the property owner to suffer a physical "invasion" of his property.
- Where regulation denies all economically beneficial or productive use of land.
Any limitation so severe cannot be newly legislated or decreed (without compensation), but must inhere in the title itself, in the restrictions that background principles of the State's law of property and nuisance already place upon land ownership. A law or decree with such an effect must, in other words, do no more than duplicate the result that could have been achieved in the courts—by adjacent landowners (or other uniquely affected persons) under the State's law of private nuisance, or by the State under its complementary power to abate nuisances that affect the public generally, or otherwise.
The trial court found that petitioner's beachfront lot would become valueless if prohibited for building. The fact that the lots next to it are also used for residential purposes and that this is apparently the only useful purpose for the land implies that this is not a use that would be a nuisance under the common law.
Yes, a regulation that renders a property valueless constitutes a taking unless it can be shown that the prohibited uses would be a nuisance. Reversed and remanded.
: The trial court's finding that the land was rendered valueless is implausible. In relying on this, the majority made new rules and imposed them on the state.
The property was unstable, with a history of flooding and erosion problems. Building that close to the beach worsens erosion. Because of this, petitioner's proposed use of the land would worsen harm his neighbors and thus compensation is not required.
Petitioner can also still enjoy other aspects of the property, such as keeping other people off his land, picnicing, swimming, camping, or moving an RV onto it. These are sufficient for the land to have some value. The trial court seems to have believed that just losing the primary purpose of the land rendered it valueless, but it really just lost most of its value, not quite all of it. While the majority is allowed to accept these findings regardless, it is unwise to do so.
If the South Carolina legislature made this law, it is supposed to be assumed that they had a factual basis for doing so. It should be assumed that the possible harm was enough to justify this as Constitutional unless petitioner showed otherwise, which he did not.
The majority rejects the old rule that a harmful use can always be prevented without compensation because whether something is harming someone or just not helping them depends on ones point of view. However, it does not define when property is deprived of all economically valuable use either. Relying on nuisance is also contrary, as that does depend on whether something is harming the use of the land.
The majority's historical analysis is also wrong because the government has historically taken people's land without paying them, it never mattered what effect the government had on people's land, it has been less likely to constitute a taking when the land was undeveloped, and the government was allowed to completely eliminate someone's property value at any time.
After the state bought the land, it sold it to someone else to build a house on.