Supreme Court Set to Hear Takings Case

U.S. Supreme Court
A Colorado web designer who refuses to make same-sex wedding websites asked the U.S. Supreme Court to take her case, which raises many of the unanswered questions from the high court’s 2018 Masterpiece Cakeshop decision. / Law Week file.

The U.S. Supreme Court will hear arguments March 22 in a case that could subject a wide variety of routine government regulatory functions to the requirements of the takings clause. The case has drawn a flurry of arguments from states both supportive and opposed to the potential expansion of the constitutional provision.

At issue is a California regulation that requires farm owners to grant union organizers access to laborers. The petitioners in the case — a Siskiyou County strawberry plant nursery and gardening center and a Fresno-based fruit packer — argue that the requirement effectively creates an easement for which no compensation has been paid and that the state should be enjoined from continuing to demand that organizers be allowed on their properties.

The California Supreme Court in a 1976 opinion rejected arguments that the regulation causes a taking of private property. The 9th U.S. Circuit Court of Appeals also rejected similar arguments, now raised by the Pacific Legal Foundation, in the case now before the Supreme Court. That court held that the California labor regulation is not a “classic taking in which [the] government directly appropriates private property.” Judge Richard Paez’s opinion, joined by Judge William Fletcher of Seattle, explained that, since the California regulation does not “allow random members of the public to unpredictably traverse their property 24 hours a day, 365 days a year,” and because it limits only an employer’s “right to exclude” organizers and not any other individuals, it could not be considered a per se physical taking.

Easement or Access

Danaya Wright, a professor at the University of Florida Levin College of Law, said she thinks the effort to label a labor union access regulation as an easement is “just absurd.” “[I]t is something that Pacific Legal Foundation [and] the pro-property rights movement have tried to do, to characterize every limitation that anybody is under as a very discrete type of property right.”

An easement, she said, is traditionally considered a legal tool that assures necessary access to adjacent property by that parcel’s owner. The situation is different when a property is made accessible to the public. “If I decide to open a restaurant, I have to let the health inspector come in and inspect my restaurant,” she said. “If I want to open my restaurant to the public, I cannot deny people of color access to my restaurant. That is called public access. The right of those people to come on, they’re not coming by virtue of an easement. They’re coming on because I’m choosing to use my land for a restaurant and because I’m using it in this way, therefore certain people of the government and the public have a right to enter.”

The justices now face a choice about how to analyze whether the California regulation creates a right of way or, instead, mandates only public access to the growers’ property. “The big issue in the case is how broadly will the court define the so-called physical takings doctrine,” said John Echeverria, a professor at Vermont Law School who specializes in property matters. He said that doctrine, which was declared in a 1982 case called Loretto v. Teleprompter Manhattan CATV Corp. and that is also known as the per se takings rule, applies only to “permanent and continuous occupations.” “In a series of precedents over the last 30 or 40 years the Supreme Court has said that alleged physical takings — physical occupations of private property or appropriations or other physical seizures of private property — are particularly suspect under the takings clause,” Echeverria continued. If a per se taking is found, no matter how small the physical presence or how minimal the economic impact, it “automatically [will] result in a conclusion that there’s been a constitutional violation.”

Assessing Impact

Were the California regulation deemed a per se taking, numerous complexities would follow. First would be the question of how much the government must pay the landowner to allow the union organizer to enter. “There’s no economic impact here,” Wright said. “There’s no devaluation of your land. If the railroad takes a 100-foot strip across your farm, we can clearly value what was taken with that easement. We can’t value this union organizer [visit].”

Another would be how the question of value is decided. “It would go back down to the lower court, and the lower court would then spend months, probably, sifting through reams of evidence about how much the cost is of having this union organizer being able to come on,” Wright said. If the government decided on a flat, nominal fee to compensate the landowner for the organizer visit, or a health inspector’s scrutiny, then a dispute about the amount would be likely. “They’ll say that’s not ‘just compensation,’” Wright said.

Wright said another difficulty that application of the per se rule in these circumstances would create is the question of how to consider the increase in property value from government health and safety mandates. Normally, she said, “you would offset that value added with value lost,” she explained. “Another thing they’re trying to do is to say, ‘you have to pay me for whatever you took, regardless of the fact that it might have improved the value of my land.’”

On the other hand, if the court looks at the case from the perspective of the regulation being more along the lines of a public access mandate, the justices will likely apply a multi-factor test that takes into account the government’s reasons for the regulation and the actual impact it has on a property owner.

That approach is rooted in the 1978 decision in Penn Central Transportation Co. v. New York City. In that case, Justice Willam Brennan wrote for a 6-3 majority that a taking “may more readily be found when the interference with property can be characterized as a physical invasion by government than when interference arises from some public program adjusting the benefits and burdens of economic life to promote the common good.”

Echeverria said the Penn Central rationale is the more logical way of addressing the petitioners’ concerns. “The EPA does inspections of polluting facilities,” he said. “OSHA does inspections of workplaces for workplace safety issues. Health officials do inspections of restaurants for health code violations on a regular basis. Child welfare officials do spot inspections of foster homes. The concern is that if the court extends its per se physical takings doctrine to cover intermittent occupations, that could hobble the government’s ability to do a lot of the important work that it does to protect public health and safety.”

The Conservative Question

While the rise of a dominant conservative majority on the Supreme Court might encourage observers to predict an outcome in favor more of the per se takings side of the constitutional spectrum, that is not a foregone conclusion. “Takings is a quandary from an originalist standpoint because there’s very little indication that the founding fathers had an expansive idea of what takings meant,” he said.

“There’s no one more conservative than Justice Thomas, but he’s leery about an expansive reading of the takings clause. It’s an instance in which the conservative originalist approach collides with the conservative impulse to protect private property rights,” Echeverria said, referring to a 1992 Supreme Court decision in which the majority, led by Scalia, reiterated that a regulation that deprives a property owner of “all economically beneficial or productive use of land” is a taking.

Wright, on the other hand, said she thinks at least four justices are likely to have already concluded they want to change the law of takings, and this case offers the opportunity to do so. “It only takes four to grant cert,” she said.

She conceded that it is possible the justices did not take the case to expand property rights. Property rights advocates have repeatedly come before the court in recent decades to seek a widening of the per se takings doctrine, she said. Wright said the court may perceive that PLF and its allies are hoping for that outcome, though it’s not explicitly argued in the case, and be interested in crushing that dream. “The court may have taken this case to just say, ‘no, we’re tired of these per se claims. Quit bringing cases to us about per se takings,’” she said.

Colorado’s attorney general Phil Weiser signed a multi-state amicus brief filed in the case that urges the court to reject the takings claim. Another coalition of states, led by Oklahoma, argues the opposite. Their position is incomprehensible to Wright. “What the hell?” she said. “I don’t understand why state governments would [argue on PLF’s side], except that they want to be able to say ‘we want to reduce regulation.’ … The unintended consequences are huge.”

“I think it would be really hard” for any regulatory regime to survive if the justices adopt the Pacific Legal Foundation arguments in the dispute, Wright concluded.

The case is Cedar Point Nursery v. Hassid, No. 20-107.

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