Add at end of Notes and Questions 1. All use?, p. 141:
Can an action of inverse condemnation be found where the government did not “intend” to take the private property, and where the damage was “reparable”? The Oregon Court of Appeals found that evidence brought by plaintiff against the City of Milwaukie for raw sewage coming through her bathroom fixtures when the city “hydrocleaned” a nearby sewer line was sufficient to prove a claim of inverse condemnation. Dunn v. City of Milwaukie, 250 P.3d 7(Or. Ct. App. 2011).
The court determined that an action for inverse condemnation is satisfied if the harm is a “natural and ordinary consequence” of the government’s action. Id. at 12. The government did not have to “intend” to take the property or damage the property. Id. The court also held that a “substantial interference” with the plaintiff’s use and enjoyment of her property includes damage to the property: in this case because the damage “significantly diminished the value” of the plaintiff’s home. Id. at 16.
The City of Milwaukie appealed the judgment in favor of plaintiff and the Supreme Court of Oregon approved it’s petition for review. Dunn v. City of Milwaukie, 350 Or. 532 (2011). Two years later, the case still was pending before the Oregon Supreme Court.
Add at end of Notes and Questions 2. The Property Interest Taken, P. 141:
Airplane overflights have caused disagreements in the courts. Some courts have applyied a regulatory takings analysis where deprivation “of all or practically all of the beneficial use of the property or of any part” is the standard; others have utilized an “actual occupation” standard, in which “the occupation is a taking,” whether or not the landowner has been deprived of all or substantially all the property value. In Brenner v. New Richmond Airport Comm’n, 816 N.W.2d 291 (Wi. 2012), the Wisconsin Supreme Court held that the physical occupation test is the proper standard in airplane overflight cases.
A taking occurs in airplane overflight cases when government action results in aircraft flying over a landowners property low enough and with sufficient frequency to have a direct and immediate effect on the use and enjoyment of the property, 816 N.W.2d at 310.
Add to Notes and Questions 3. The measure of compensation, pg. 142, Insert as a new paragraph immediately following the paragraph that starts “The measure of compensation for temporary regulatory takings is different from the measure of compensation for permanent takings.”
In Otay Mesa Property, L.P. v. United States, 670 F.3d 1358 (Fed. Cir. 2012), the property owners granted the United States Border Patrol a twenty-foot wide easement for use in monitoring and responding to illegal alien activity. Later, the property owners sued the United States alleging that the Border Patrol’s activities outside of the easement constituted a permanent, physical taking requiring just compensation. The Court of Federal Claims held that the property owners were entitled to compensation for a temporary physical taking, not a permanent physical taking. According to the court, the taking was temporary because the easement “terminates ‘upon the occurrence of one of two events: (1) when the sensor is removed because it is no longer needed [by the Border Patrol]; or (2) when [Otay Mesa] obtain[s] a grading permit from the County of San Diego permitting development of all or a portion of the property.’” The Court of Federal Claims used the fair market rental value method to calculate the amount of the compensation award. On appeal, the Federal Circuit agreed that the normal measure of compensation for temporary takings is the fair rental value method; however, the Federal Circuit held that the Court of Federal Claims erred in finding that the taking was temporary. Citing Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982), the Federal Circuit stated that “the Supreme Court has defined a taking to be ‘permanent’ even when specified action initiated by the landowner could terminate the taking.” Finally, the Federal Circuit remanded the case for a redetermination of damages after rejecting the Court of Federal Claims’ use of the fair rental value of the land for parachute and skydiving training as the method for calculating damages. The Federal Circuit did not decide the method of valuation that should be used, though it provided some guidance. It stated that “a court must sometimes deviate from the traditional permanent taking- diminution in value and temporary taking-rental value approaches” and that the Court of Federal Claims had the discretion, on remand, to identify the most appropriate method for calculating the just compensation award in this permanent, physical takings case.
Insert in Notes and Questions between Notes 6 & 7 as new note 7, Pg. 144:
Inverse Condemnation is a difficult burden for landowners to overcome. See Town of Gurley v. M & N Materials, Inc., 1110439, 2012 WL 6634447 (Ala. Dec. 21, 2012) (landowners could not pursue an inverse condemnation claim if they wished to stay within the state courts). JKS Realty LLC v. City of Nashua, 55 A.3d 941 (N.H. 2012) (merely plotting land in anticipation of taking it does not amount to an aggravated delay required for a finding of inverse condemnation). Viewcrest Investments, LLC v. Oregon, 288 P.3d 574 (Or. Ct. App. 2012) (when landowners property became landlocked through delay of interchange revision, a taking had not occurred simply because the value of landowner’s property decreased upon publication of the interchange plan). Richards v. County of Missoula, 288 P.3d 175 (Mont. 2012) (economic loss resulting from rejection of subdivision application was not a taking as subdivision approval requirement includes the risk that approval may not be granted).
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Add at end of Notes and Questions 5. Delay as a taking, page 143-144 before the paragraph that starts “A somewhat different problem arises….”
For a case discussing extraordinary delay as a taking, see Res. Investments, Inc. v. United States, 85 Fed. Cl. 447 (Fed. Cl. 2009). The court traces the concept of a regulatory taking emanating from extraordinary delay beginning with Agins v. City of Tiburon, 447 U.S. 255 (1980) and through Appolo Fuels, Inc. v. United States, 381 F.3d 1338 (2004), cert. denied, 543 U.S. 1188 (2005). After observing that First English Evangelical governed, the court stated that: "If permit denial were the only way for an agency to effect a regulatory taking, agencies could avoid implicating the Takings Clause by refusing to deny a permit, instead consigning it to regulatory limbo by not acting. The precept of 'extraordinary delay' is thus an exception to the general ripeness rule."
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The City of Milwaukie appealed the judgment in favor of plaintiff and the Supreme Court of Oregon approved its petition for review. Dunn v. City of Milwaukie, 350 Or. 532 (2011). As of the time of publication of this update, the Supreme Court of Oregon had yet to hear the case.
Add at end of Notes and Questions 5. Delay as a taking, pg. 144, Insert at the end of the first paragraph as an addition to the “but see” string citation and following the DeSai case:
Resources Investments, Inc. v. United States, 93 Fed. Cl. 373 (Fed. Cl. 2010) (Lucas claim proven on summary judgment motion except for issue of causation after extraordinary delay and ultimate denial of property owner’s permit application for construction and operation of solid waste landfill).
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The Lucas Case: A Per Se Takings Rule
Lucas v. South Carolina Coastal Council
NOTES AND QUESTIONS
Add to Notes and Questions 3, What constitutes deprivation of “all economic use,” page 152 in second paragraph, immediately after Friedenburg v. New York State Dep’t of Envtl. Conservation:
In DeCook v. Rochester Int’l Airport Joint Zoning Bd., 796 N.W.2d 299 (Minn. 2011), the court applied Minnesota caselaw (McShane v. City of Faribault, 292 N.W.2d 253 (Minn. 1980) and held that a zoning ordinance that extended the size of the runway safety zone over the landowners’ property and reduced their property value by $170,000 caused a taking under the Minnesota constitution. According to McShane, “ʻthere must be compensation to landowners whose property has suffered a substantial and measurable decline in market value as a result of the regulations.’” DeCook, 796 N.W.2d at 307 (citing McShane).
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Add to Notes and Questions 5, Sources, page 153:
Patrick C. McGinley, Bundled Rights and Reasonable Expectations: Applying the Lucas Categorical Taking Rule to Severed Mineral Property Interests, 11 Vt. J. Envtl. L. 525, (2009-2010).
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A NOTE ON HOW THE COURTS HAVE DRAWN THE TEETH OF THE LUCAS
DECISION
Insert page 154 at the end of the paragraph that starts “The parcel as a whole rule has significantly impacted the development of takings jurisprudence.”
For example, in Galleon Bay Corp. v. Board of County Commissioners of Monroe County, 105 So.3d 555 (Fla. Dist. Ct. App. Dec. 5, 2012), the court of appeals found that the trial court erred in considering subdivisions that had been separately platted and developed years earlier in determining whether the property owner’s investment-backed expectations were met. The court of appeals reversed the trial court and found a Lucas taking. In Lost Tree Village Corp v. United States, 707 F.3d 1286 (Fed. Cir. 2013), a wetlands fill case, the court concluded that the relevant parcel was the 4.99 acre plat on which the property owner sought an application to fill wetlands (Plat 57). In so holding, the Federal Circuit reversed the Court of Federal Claims and held that it “erred by aggregating Plat 57, Plat 55, and the scattered wetlands as the relevant parcel. . . . [T]he mere fact that the properties are commonly owned and located in the same vicinity is an insufficient basis on which to find they constitute a single parcel for purposes of the takings analysis.”
Insert Page 157, second paragraph, Guggenheim citation:
change “see” to “but see” and change citation to “638 F.3d 1111 (9th Cir. 2010)” and delete the parenthetical and replace it with the following (vacating the earlier court of appeals opinion on rehearing en banc and holding that no taking occurred in facial Penn Central challenge of rent control ordinance as applied to mobile home park as mobile home park owners made return on investment and property was subject to same rent control ordinance at the time of park owners’ acquisition). The en banc court reversed a rather unusual interpretation of the Penn Central factors by the panel.
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Insert page 158 at the end of the paragraph that starts “Mandelker, Investment-Backed Expectations. . . .”:
Ruppert, Reasonable Investment-Backed Expectations: Should Notice of Rising Seas Lead to Falling Expectations for Coastal Property Purchasers?, 26 J. Land Use & Envtl. L. 239 (2011).
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Penn Central Vindicated
Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning
Agency, Inc.
NOTES AND QUESTIONS
Notes and Questions 1. Insert page 168 end of note 1, paragraph 1:
For a discussion on the interaction between Penn Central and the Tahoe-Sierra, Lucas, and First English decisions, see Radford, Deciphering and Extrapolating: Searching for Sense in Penn Central, 38 Ecology L.Q. 731 (2011) (analyzing whether preexisting notice of land use regulations trump the Penn Central balancing test).
Add at end of Notes and Questions 2, page 169 , Vindication for Penn Central?:
Cordes, The Fairness Dimension in Takings Jurisprudence, 20 Kan. J.L. & Pub. Pol'y 1, 2 (Fall 2010) (opining that the Tahoe-Sierra opinion, combined with the Lucas and Palazzolo opinions, “establish the ascendency of Penn Central as the primary vehicle for takings analysis”).
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Insert page 169 end of paragraph 2
Vindication for Penn Central?: Cordes, The Fairness Dimension in Takings Jurisprudence, 20 Kan. J.L. & Pub. Pol'y 1 (Fall 2010) (discussing the application of the Penn Central factors in light of fairness and justice concerns).
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Add at end of Notes and Questions 3, page 170, Applying the Penn Central test:
For a discussion of an inverse condemnation claim arising from a nuisance conducted by an entity that has the eminent domain power, see Rader Family Limited Partnership, L.L.L.P v. City of Columbia, 307 S.W.3d 243 (Mo. App. 2010) stating that in inverse condemnation cases, the appropriate measure of damages is lost fair market value immediately after the taking.
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Insert page 170 at the end of the second paragraph in Note 3 (p. 169):
In Zimmerman v. Hudson, 264 P.3d 989, 992 (Kan. 2011), the Board of County Commissioners of Wabaunsee County, Kansas enacted a moratorium on conditional use permits for commercial wind farms in order to conduct a comprehensive study for the sake of determining the overall impact of such commercial wind facilities. The plaintiff property owners and intervening wind-power royalty owners claimed this moratorium constituted a taking of their vested right in pursuing a conditional use permit. The Kansas Supreme Court found that the Board's moratorium was not a taking, because the plaintiff property owners and intervening wind-power royalty owners did not have a vested right in obtaining a conditional use permit. Id. at 1005.
But see DeCook v. Rochester Intern. Airport Joint Zoning Bd., 796 N.W.2d 299, 301 (Minn. 2011), in which the Minnesota Supreme Court held that a zoning ordinance extending an airport “safety zone” onto private property constituted a taking under the Minnesota Constitution’s broader “taken, destroyed or damaged” provision (Minn. Const. art. I § 13 (emphasis added)) when the burdened property suffered a $170,000 diminution in value. The court applied the rule from a previous airport takings case, declaring that “when an airport ordinance regulates land use within runway safety zones, there must be compensation to landowners whose property has suffered a substantial and measurable decline in market value as a result of the regulations.” Id. at 307 (internal citations omitted). The “substantial and measurable decline” test differs from the Penn Central test, which also takes into account the diminution of value relative to the overall property value. Without the additional Penn Central factors, the court found that even when the entire property was worth several million dollars, the $170,000 diminution was substantial “by any definition,” and constituted a regulatory taking. Id. at 308-309. For a discussion of whether states can provide greater protection from uncompensated takings than Penn Central offers, including the Minnesota McShane and DeCook cases, see Radford & Wake, Deciphering and Extrapolating: Searching for Sense in Penn Central, supra.
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Insert at end of the last paragraph of Note 3, beginning on p. 169 and ending on p. 170 as a new paragraph:
Does damage caused by temporary flooding constitute a taking, or a tort? Property located in flooding zones below dams often are subject to flowage easements, which allow the dam to release water into the flood zone on a comprehensive schedule designed to enable maximum agricultural usage of the land and minimal damage to the environment. However, deviations from these plans are sometimes necessary to prevent widespread flooding, or for other special purposes, and such deviations can disrupt the landscapes below. In Arkansas Game & Fish Com’n v. U.S., 637 F.3d 1366, 1367 (Fed. Cir. 2011), the Army Corps of Engineers approved several deviations in a dam release schedule from 1993-2000 in southern Missouri, which increased the average duration of flooding during the “critical” tree growing period of June to August each year in an Arkansas “management area” downriver. Id. at 1372-73. As a result, timber trees in the flood zones weakened by excessive flooding over the six year period did not survive a subsequent drought. Id. at 1373. The Federal Claims court awarded $5.5 million in damages for the dead and damaged timber for the temporary taking. Id. at 1374. On appeal, the court reversed the decision and held that “a flooding must be a permanent or inevitably recurring condition, rather than an inherently temporary situation, to constitute the taking of a flowage easement.” Id. at 1378. The court reasoned that the Army Corps of Engineers' deviations from the plan were “by their very nature temporary” and “cannot be ‘inevitably recurring’ or constitute the taking of a flowage easement,” Id. at 1367, and that “an injury that is only in its nature indirect and consequential” is a tort, not a taking. Id. at 1374 (internal quotations omitted). See also State ex rel. Doner v. Zody, 130 Ohio St. 3d 446, 446, 463-64 (Oh. 2011) (where the Ohio Supreme Court held that intermittent flooding caused by spillway construction satisfied the two part test for takings-by-flooding claim because the claimants had clear and convincing evidence that the flooding of their property was the “direct, natural, or probable result of respondents’ actions,” and that the flooding was “inevitably recurring.” The court granted writ of mandamus to compel appropriation proceedings to determine the amount of taking that occurred. Id. at 464-65.)
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Insert at end of the last paragraph of Note 3, beginning on p. 169 and ending on p. 170 as a new paragraph:
Does damage caused by temporary flooding constitute a taking? Property located in flooding zones below dams often are subject to flowage easements, which allow the dam to release water into the flood zone on a comprehensive schedule designed to enable maximum agricultural usage of the land and minimal damage to the environment. However, deviations from these plans are sometimes necessary to prevent widespread flooding, or for other special purposes, and such deviations can disrupt the landscapes below. (Source?) In Arkansas Game & Fish Com’n v. U.S., 133 S.Ct. 511, 515 (2012) the Supreme Court held that recurring floodings of a temporary nature “are not categorically exempt from Takings Clause liability.” From 1993 to 2000, the Army Corps of Engineers approved several deviations in a dam release schedule in southern Missouri. These changes increased the average duration of flooding in an Arkansas forest-management area downriver during the peak tree growing season of June to August each year. As a result, more than 18 million board feet of timber were damaged or destroyed. Id. at 515-6. The Court of Federal Claims held that a temporary taking had occurred and awarded $5.7 million for the dead and damaged timber. Id. at 517. On appeal, the Federal Circuit reversed on the grounds that compensation may only be awarded when “[g]overnment-induced flooding … is permanent or inevitably recurring.” Id.
The Supreme Court reversed, holding that “government-induced flooding temporary in duration gains no automatic exemption from Takings Clause inspection.” Id. at 522. The Court reasoned that the Army Corps of Engineers' temporary deviations from the plan gave rise to “a direct and immediate interference with the enjoyment and use of the land” (quoting United States v. Causby, 328 U. S. 256, 266 (1946)) and can constitute a taking under the law. Id. at 519. The Court saw no reason to treat flooding differently from other government intrusions Id. at 521. The Court identified several factors “relevant to the takings inquiry,” including the length of time of the physical invasion, whether the invasion “is intended or is the foreseeable result of authorized government action,” the character of the land affected, any “’reasonable investment-backed expectations,’” and the “severity of the interference.” Id. at 522. See also Livingston v. Va. Dep’t of Transp., 726 S.E.2d 264, 145. (Va. 2012). (failure to maintain canals to mitigate flooding may constitute temporary taking). For further discussion of AK Game & Fish Com’n, see Brian T. Hodges, AK. Game & Fish Com’n v. U.S., 65 Plan. & Envtl. Law 3, 10-12 (2013) (case is a “major step forward in protecting property rights … [but is] only a temporary fix for the temporary takings issue because it left the question of how a court should review such a claim unresolved”).
 In City of Venice v. Gwynn, 76 So. 3d 401, 402 (Fla. App. 2011), the Florida appellate court quashed a circuit court order voiding a zoning board decision - to disallow a property owner her “grandfathered” right to offer short-term leases on her property - because the lower court failed to apply the economic impact factor of the Penn Central test. Id. at 405. The court reinstated the order of the Venice Code Enforcement Board, id., which prohibited the owner from renting single-family dwellings for periods under thirty days. Id. at 403. Because the record showed Gwynn’s property had continued value as a monthly rental or as an investment property, the appellate court clarified that the standard for economic impact is ultimately concerned with intended use, but rather “whether the landowner has been denied all or substantially all economically viable use of his land.” Id. at 405.
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