Supreme Court Will Hear Important Property Rights Case

This could result in a ruling overturning a terrible 1985 decision that makes it very difficult to bring takings cases in federal court.

The Supreme Court.

Earlier today, the Supreme Court decided to review Knick v. Township of Scott, an important property rights case. The most important issue the Court will consider is whether to overrule Williamson County Regional Planning Commission v. Hamilton Bank, a 1985 decision that makes it very difficult or impossible to bring takings cases in federal court. Under Williamson County, a property owner who contends that the government has taken his property and therefores owes "just compensation" under the Fifth Amendment, cannot file a case in federal court until he or she has first gotten a "final decision" from the appropriate state or local regulatory agency and has "exhausted" all possible remedies in state court. Even after all of that, it is often impossible to bring a federal claim, because a variety of procedural barriers preclude federal courts from reviewing state court decisions in cases where the case was initially brought in state court. In some cases, governments defending against takings claims even exercise their right to "remove" the case to federal court, and then manage to get the case dismissed because the property owner did not manage to first "exhaust" state court remedies (a failure caused by the defendants' own decision to get the case removed).

Williamson County creates an egregious Catch-22 trap for property owners: before they can bring a claim in federal court, they must first go through state courts and administrative agencies. But the very act of going to state court makes it virtually impossible to later appeal the case to a federal court! This is the kind of Kafkaesque idiocy that gives the legal profession a bad name.

One might ask why it matters whether takings cases are litigated in state court or federal court. After all, both state and federal judges have to apply the Takings Clause of the Fifth Amendment, and both have to follow relevant federal court precedents. In many cases, the result will be the same, regardless of venue. But in some situations, particularly ones where precedent is unclear and the issues may be ambiguous, state courts could well be biased against property owners, because they have close connections with the state and local governments that undermined the property rights in question. This may be particularly likely in the many states where judges are elected, and are therefore part of the same political coalition as local and state government officials.

In addition, allowing review in federal court helps ensure enforcement of at least a minimal uniform floor of constitutional rights through the nation. That, after all, is one of the main purposes of having federal constitutional rights in the first place. As prominent nineteenth century Supreme Court Justice Joseph Story explained in Martin v. Hunter's Lessee, a famous 1816 decision, one of the main reasons why federal courts have ultimate jurisdiction over federal constitutional issues is "the importance, and even necessity of uniformity of decisions throughout the whole United States, upon all subjects within the purview of the constitution." Story also warned that the availability of federal judicial review is essential to prevent enforcement of constitutional rights from being being impeded by state court bias in favor of their own state governments:

The Constitution has presumed… that State attachments, State prejudices, State jealousies, and State interests might sometimes obstruct or control, or be supposed to obstruct or control, the regular administration of justice. Hence, in controversies between States, between citizens of different States, between citizens claiming grants under different States, between a State and its citizens, or foreigners, and between citizens and foreigners, it enables the parties, under the authority of Congress, to have the controversies heard, tried, and determined before the national tribunals.

The Catch-22 problem Williamson County creates for takings claimants has no parallel with respect to other constitutional rights. Citizens who believe state or local governments have violated their rights to free speech, freedom of religion, or freedom from race and sex discrimination, are not required to first "exhaust" state court remedies before bringing a case in federal court.

The supposed justification for Williamson County is that the state or local government has not really "taken" property until the action in question has been validated by state administrative agencies and state courts. But, by the same reasoning, one can argue that a state has not really censored speech or suppressed religion until state agencies and state courts uphold the policy in question. If a state or local government has taken property without paying compensation, that is a violation of the Takings Clause, regardless of whether other state officials might later decide to reverse that action.

In the 2005 case of San Remo Hotel v. City and County of San Francisco, then-Chief Justice William Rehnquist wrote a concurring opinion, joined by three other justices (including Clarence Thomas, Sandra Day O'Connor, and current Supreme Court swing-voter Anthony Kennedy), in which he admitted he had been wrong to vote with the majority in Williamson County, and urged the Court to reconsider it in a future case:

As the Court recognizes,… Williamson County all but guarantees that claimants will be unable to utilize the federal courts to enforce the Fifth Amendment's just compensation guarantee. The basic principle that state courts are competent to enforce federal rights and to adjudicate federal takings claims is sound,… and would apply to any number of federal claims…. But that principle does not explain why federal takings claims in particular should be singled out to be confined to state court, in the absence of any asserted justification or congressional directive.

I joined the opinion of the Court in Williamson County. But further reflection and experience lead me to think that the justifications for its state-litigation requirement are suspect, while its impact on takings plaintiffs is dramatic.

The San Remo majority suggested that takings cases can be left to state courts because "state courts . . . have more experience than federal courts do in resolving complex, factual, technical, and legal questions relating to zoning and land-use regulations." But, of course, the same thing can be said of many other types of constitutional claims against state and local governments, where state judges are likely to know more about the relevant "factual" and "technical" issues than federal courts do.

As Rehnquist belatedly recognized, Williamson County creates a double standard under which Takings Clause claims are denied access to federal court in situations where other constitutional rights claims would be allowed. This doctrine is a manifestation of the longstanding second class status of constitutional property rights, which the Supreme Court has gradually begun to reverse in recent years. Hopefully, the justices will take another step in the right direction by eliminating an indefensible anomaly in its constitutional jurisprudence.

For the factual background to the Knick case, see this site created by the Pacific Legal Foundation, the public interest law firm representing the property owners in the case.

UPDATE: I have made minor changes to the wording of this post.