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Tuesday, June 22, 2010

Judicial Takings

I have to admit that I was fearing the worst from Stop the Beach Renourishment, Inc. v. Florida Dept of Environmental Protection, the Court's recent takings clause case, but the result was, to my mind, striking for its reasonableness.  The Court unanimously upheld the Florida Supreme Court's decision that Florida's complicated beach renourishment scheme did not take property from beachfront landowners.  The case raises a number of interesting questions.  Among these was the intriguing question, as Ben Barros put it in his comments to the New York Times, "why would a beachfront property owner oppose beach renourishment?"  As someone who has been critical of beach renourishment as a taxpayer funded giveaway to well-heeled beachfront owners, I found it a bit jarring to agree with with the (shall we say) idiosyncratic plaintiffs with the bust of Ronald Reagan in their office that we should leave beach erosion and accretion to mother nature. 

Although the  decision on the merits is interesting -- especially to property geeks like me who enjoy reading about the difference between avulsion and accretion within the common law  -- the more interesting part of the opinion was the back and forth between Justice Scalia and Justice Kennedy over the question of "judicial takings."  Apparently important to the property rights community, judicial takings is not a topic I've given a ton of thought to, aside from the brief discussion of the issue in my first-year property course.  Reading over the opinions and the commentary in the days surrounding the decision, however, a few (somewhat half-baked) thoughts came to mind.

First, as I worked through the opinions, I have to confess being initially sympathetic -- in an abstract way -- with the bare possibility of judicial takings and with Scalia's clean argument for treating new property rules created by the judiciary no differently than new rules enacted by the legislature or by an administrative agency.  But, for reasons I'll get into below, I'm not ultimately convinced that this equivalent treatment is actually justified most of the time. 

Second, a commentator on NPR talked about the doctrine of judicial takings as potentially limiting the power of judges.  This struck me as true in a sense, but also a little misleading.  Although a judicial takings doctrine would arguably impose some new constraints on state courts, the doctrine would simultaneously seem to dramatically enhance the power of federal courts to review state court decisions on takings clause grounds.  And, last time I checked, federal judges were also judges. 

Now, it's not completely clear how you'd get to federal court to raise your claim, in light of the onerous exhaustion requirements the Court has imposed on takings claims under Williamson County.  It's an interesting question to consider whether a doctrine of judicial takings would necessarily open up an avenue of collateral appeal of state court civil judgments in the lower federal courts -- almost like habeas corpus for disgruntled civil litigants.  Scalia emphasizes the route used by the plaintiffs in this case -- certiorari to the Supreme Court from a final judgment in state court, which would not be very significant in light of the small number of cases that could successfully get to the high court, but that would be the required path only for the litigants in the case first giving rise to the so-called judicial taking.  For other litigants, he does not rule out a collateral attack in federal court if a takings claim in state court would be futile.

Scalia tries to paint this as nothing new, since this route to federal courts is already available for challenges to state exeuctive or leglislative actions as well.  But there does seem to be something new about the judicial takings route, particularly in light of the expansive view of the takings clause Scalia has endorsed in the past.  Specifically, I'm not sure how Scalia and the rest of the plurality who favored judicial takings would cabin the doctrine to cases -- like this one -- where a state court explicitly considers the meaning of its common law of private ownership.  After all, in Eastern Enterprises v. Apfel, Scalia and Thomas both endorsed the notion that the retroactive imposition of monetary liability violates the takings clause. 

If that were the law, then it's not clear that the doctrine of judicial takings the plurality endorses in Stop the Beach Renourishment wouldn't open the door to a federal claim for any party who thinks a state court got the law wrong, if the result of the new legal rule would be an award of damages against the claimant.  And this would be true even if the law the state court got wrong were the law of contracts or torts, and not just the law of property.  A state supreme court case on the law of, say, contracts, which the claimant thinks changed clearly established law and which, if applied in the claimant's case, would result in an adverse damages award, would seem to operate, from the standpoint of Scalia's version of the takings clause, the same as the retroactive imposition of monetary liability in Eastern Enterprises.  And so a robust doctrine of judicial takings would appear to create a very dramatic and broad power to challenge civil state-court decisions of any sort in federal court.  For the losing party, the path of appeal would be through a judicial takings claim in a cert petition to the Supreme Court.  But for non-parties to the original case for whom the state high-court decision would adversely affect their interests, the door would seem to be open to a takings challenge in lower federal courts.

And this gets at why I think Scalia goes wrong with his easy argument for treating courts the same as other branches of government.  His mistake comes early on in the opinion where he says that "the classic taking is a transfer of property to the State or to another private party by eminent domain."  I think this is wrong.  The classic use of eminent domain is a transfer to the state.  The so-called private-to-private uses of eminent domain are typically understood as derivative of this paradigmatic private-to-state taking, to be used in situations in which it is for some reason preferable to have a private party undertake the public purpose the state is seeking to advance through the use of eminent domain. 

The key point is that, even in private-to-private takings, there is always a governmental actor seeking to advance a state objective.  That is not true, however, in any number of cases where judges are trying to decide a case between private litigants.  In most of those cases, the state courts are not seeking to advance a public purpose, but rather to resolve private disputes as best they can.  To say that a state court decision resulting in a loss of property rights (or, perhaps, money) is the equivalent of eminent domain is to ignore this distinction, which Joe Sax made in one of his early takings articles.  Thus, when Justice Kennedy gives the example of a state court trying to revolve a boundary dispute between two private parties, it's just not obvious to me how even a clearly erroneous decision on the merits takes the loser's property for public use.  It certainly deprives the loser of property that he had before, but not in the service of some state goal.  And that difference seems significant for deciding whether to treat this claim under the takings clause or the due process clause.  (I don't think I'm being overly formalistic in making this distinction, but I need to think about it some more, and I'm open to being convinced otherwise.)  Sure, from the perspective of the owners, both types of actions are similar:  they both result in property owners losing property (or money) to which they otherwise would have been entitled, but the state (court's) role and goals are very different in the two sorts of cases.  At the end of the day, then, I suppose I am inclined towards Justice Kennedy's due-process approach.

This still leaves me open to the possibility of a narrower category of so-called "judicial" takings, which would be limited to situations in which the state court is -- as in the Stop the Beach Renourishment Case -- adjudicating between the state and a private actor.  In such cases, the state court's redefinition of property rights to make room for the state's own action could, if it erroneously disregards established property rights -- have the affect of unlawfully empowering the state to take property for public use without just compensation.  Even in these cases, care would need to be taken to avoid finding to be takings situations in which the state court was merely clarifying the law or applying an existing (but broad) principle (like sic utere) to a new factual situation or in light of new knowledge about the harmfulness of longstanding practices.  But where the state court is merely adjudicating between private actors -- as it is in most common law property, contract, and torts cases -- the proper rubric seems to me to be Justice Kennedy's due-process analysis.

UPDATE:  Proving that there's no idea I can have that Lior Strahilevitz can't have more clearly and at least five days sooner, here's a link to his excellent post from a few days ago at the U. Chicago Law Profs blog, which makes many of the same points, and, in addition, connects the beach renourishment case up to Kelo v. New London.

Posted by Eduardo Penalver on June 22, 2010 at 02:56 PM | Permalink

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