Record and brief — Deltona Corp. v. United States
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81-1207 FILED
DEG 29 1981
ALEXANDER . STEVAS,
CLERK
NO.
in the
Supreme Court
of the
United States
OCTOBER TERM, 1981
THE DELTONA CORPORATION,
Petitioner,
vs.
UNITED STATES OF AMERICA,
Respondent.
PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF CLAIMS
* * *
WILLIAM LOUIS EARL,
Counsel Of Record
WILLIAM F. TARR
PEEPLES, EARL, MOORE
& BLANK
One Biscayne Tower, Suite 3636
Two South Biscayne Boulevard
Miami, Florida 33131
(305) 358-3000
Attorneys for Petitioner
December, 1981
——
QUESTIONS PRESENTED
1. Whether the Court of Claims erred in holding
that there is no taking when the federal government
destroys all economically viable use of a landowner's
property, so long as that landowner is left with other
nearby property that has economic value.
2. Whether the Court of Claims improperly
sanctioned the use of federal wetlands regulations to
preserve property by regulation instead of purchase.
* The caption lists all parties to this action. Pursuant to Rule
28.1, the following is a listing of all parent companies, subsidiaries
(except wholly owned subsidiaries), and affiliates of The Deltona
Corporation: The Mackle Co., Inc.; Tierra Verde Co.; Spring Hill
Realty Co., Inc.
TABLE OF CONTENTS
Page
QUESTIONS PRESENTED ................... i
TABLE OF AUTHORITIES ................... iv
e = 2
,,,, AA sus 2
CONSTITUTIONAL PROVISIONS, STATUTES
AND REGULATIONS INVOLVED ............. 3
STATEMENT OF THE CASE ................. 4
A. Nature of the Real Property atIssue.... 5
B. Planning of Marco Island 7
C. New, Increasingly Complex and Rigorous
Federal Regulations .................. 8
D. The Corps’s 1969 Authorization for Deltona
To Advertise and Offer for Sale the Lands
1 bbb 9
E. Federal Involvement in State Development
r resernee i Mey 11
F. The Corps’s Decision Prohibiting Use of
the Property at Ieswe ........ 11
G. Impact of the Corps’s Decision on Deltona’s
Pr. ve pat eseeneteneeceues 12
ii
TABLE OF CONTENTS (Continued)
Page
REASONS FOR ALLOWANCE OF THE WRIT ..
I. The Court of Claims Erroneously Held
That There Is No Taking When All
Economically Viable Use Of Land Is
Destroyed, So Long As The Landowner
Retains Some Other Separable Land That
Has Economic Value ..................
A. The Court of Claims’ Decision
Conflicts with the Principle Set
Forth in a Recent Decision of the
D,, ̃ A
B. The Court of Claims’ Decision Is
Contrary to Several Decisions of
D cau eu eden wns
II. The Court of Claims Improperly Sanctioned
The Use Of Federal Wetlands Regulations
To Preserve Property By Regulation
Instead Of Purchase ...........ccccee.
Dr, RA ee ey eee arn Eee
APPENDIX (Separately Bound)
iii
15
15
16
20
TABLE OF AUTHORITIES
Cases Page
Agins v. City of Tiburon,
, oe 19
American Savings and Loan Association
v. County of Marin,
653 F.2d 364 (9th Cir. 19811ͤ1⸗ 15, 17,
Armstrong v. United States,
EE co seseesceeescccvces ces 23
Benenson v. United States,
548 F.2d 939 (Ct. Cl. 1977) ................ 6
Drakes Bay Land Company v. United States,
424 F.2d 574 (Ct. Cl. 1970 ) 24
Eastern School v. United States,
381 F.2d 421 (Ct. Cl. 1967) ................ 14
Graham v. Estuary Properties, Inc.,
399 So.2d 1374 (Fla. 1981), cert. denied,
50 U.S. L. W. 3441 (Nov. 30, 1981777 4
Kaiser Aetna u United States,
, ce aeue's 20, 23
Lynch v. Household Finance Corp.,
, qq 25
Natural Resources Defense Council u Callaway,
392 F.Supp. 685 (D.D.C. 1975))))) 9
iv
TABLE OF AUTHORITIES (Continued)
Cases Page
Nectow v. City of Cambridge,
Be Gs ME 21
Penn Central Transportation Company v.
City of New York,
PPP eee 6, 13,
17, 18,
19, 25
San Diego Gas & Electric Company v.
City of San Diego,
US. 101 S.Ct. 1287 (1981) . . 20
CONSTITUTIONAL PROVISION
United States Constitution, Amendment ..... 3, 25
STATUTES
.
„
Co ˙ ²1¹w⅛‚ͥ ͤ
OO ONG UE ˙ ˙—˙——
%%%ôͤÜéܧö:Ü k eee
nl oxo coiseedicckee ee
TABLE OF AUTHORITIES (Continued)
.
28 U.. C. 618
„bbb
$8 U.S.C. 615i.
us. 6% ũꝗ ern
REGULATIONS
33 C. F. R. 5209. 1200...
33 C. F. R. §209.120(d\(1) . .
eee eee ee eee ers s
33 C. F. R. 5209. 1 200d)“ ¹⁰Uͤ o):
33 C. F. R. §209.120(d\2MiMd) „„
33 C. F. R. 5209. 12000) 8)( ü)
33 C. F. R. 5209. 1200808), ) eee
33 C. F. R. 8209.120080 v)
vi
TABLE OF AUTHORITIES (Continued)
Page
OTHER AUTHORITIES
Court of Claims Rule 147 (b 14
Dunham, A Legal and Economic Basis for
City Planning,
58 Col.L.Rev. 650 (1958) ................. 25
Michelman, Property, Utility, and Fairness:
Comments On The Ethical Foundations Of
“Just Compensation” Law,
80 Harv.L.Rev. 1165 (1987) )) 16
Report by the Comptroller General of the
United States, The Federal Drive To
Acquire Private Lands Should Be Reassessed,
CED-80-14 (Dec. 14, 1979) ................ 24
vii
NO.
in the
Supreme Court
of the
United States
OCTOBER TERM, 1981
THE DELTONA CORPORATION,
Petitioner,
vs.
UNITED STATES OF AMERICA,
Respondent.
PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF CLAIMS
Petitioner, The Deltona Corporation, respectfully
requests that a writ of certiorari be issued to review
the judgment and opinion of the United States Court of
Claims entered in this proceeding on August 19, 1981.
In this petition, The Deltona Corporation will be referred to
as “Deltona.” Respondent will be referred to as “the federal
government,” and the U.S. Army Corps of Engineers, which was
the agency acting on behalf of respondent, will be referred to as
“the Corps.”
OPINIONS BELOW
Trial of this inverse condemnation action, based
on federal land-use restrictions, was held from June 2
through June 17, 1980. On November 25, 1980, the
Court of Claims trial judge issued his report finding
that application of federal regulations to Deltona’s real
property destroyed all economically viable use of it;
interfered with Deltona’s reasonable, investment-backed
expectations; and, in effect, preserved Deltona’s property
for public benefit as an adjunct of the nearby Everglades
National Park.’ His order, findings of fact, and conclusion
of law are unreported but are reproduced at page A-1
of the separately bound Appendix.’
The Court of Claims rejected the trial judge's
conclusion of law that there had been a taking and held
in favor of the United States. The opinion of the Court
of Claims, reported at 657 F.2d 1184, is reproduced at
page A-132 of the separately bound Appendix.
JURISDICTION
This Court’s jurisdiction is invoked under 28 U.S.C.
§1255. The judgment of the Court of Claims was entered
August 19, 1981. Deltona’s timely motion for rehearing
was denied October 2, 1981. This petition for certiorari
was filed within ninety (90) days of that date.
*For a map showing the location of the real property at issue
in relation to the Everglades National Park and other government
lands, see the separate Appendix at A-180.
*References to the separate Appendix will be cited as “App.
A The trial judge’s findings of fact will be cited as —
— References to the trial transcript will be cited ° ,—
Deltona’s trial exhibits will be cited “Pl. EX.
CONSTITUTIONAL PROVISIONS, STATUTES
AND REGULATIONS INVOLVED
The following constitutional provisions, statutes,
and regulations are involved in this case. Because of
their length, the text has been set forth verbatim in
the separately bound Appendix at page A-157:
1. United States Constitution, Amendment
V.
2. Section 404, Federal Water Pollution Control
Act Amendments of 1972, 33 U.S.C. §1344
(1976).
3. Section 401, Federal Water Pollution Control
Act Amendments of 1972, 33 U.S.C. §1341
(1976).
4. Section 10, Rivers and Harbors
Appropriation Act of 1899, 33 U.S.C. §403.
5. Regulations of Army Corps of Engineers,
33 C.F.R. §209.120 (40 Fed. Reg. 31320)
(July 25, 1975).
a. Definition: “Navigable Waters of the
United States,” 33 C.F.R. §209.120(d\1)
(40 Fed. Reg. 31324).
b. Definition: “Navigable Waters,” 33
C. F. R. §209.120(d\2\iXb) and (d) (40 Fed.
Reg. 31324).
e. Favorable State Determinations, 33
C.F.R. 5209. 120,3 (iii) (40 Fed. Reg.
31327).
d. Corps Policy Regarding Wetlands, 33
C.F.R. §209.120(gX3Xi) and (iv) (40 Fed.
Reg. 31328).
STATEMENT OF THE CASE
This case arose because dramatic and far-reaching
changes in the federal government’s environmental
and land-use policies prevented completion of an ongoing
development that had been master planned and
commenced years before the onset of those policies. In
applying such new federal restrictions, the federal
government denied permits for two large tracts of land
to preserve them in their natural state for the public
benefit. This resulted in the prohibition of all reasonable,
economically viable use of the real property at issue.
This action is important because the court below
held that a claimant is barred from recovering just
compensation for property that has been taken, if that
claimant owns other nearby property that has some
economic value. Factually, this case is also significant
because it shows the confiscatory results that can arise
when government applies subsequently enacted
regulations to a previously started development and,
as found by the Court of Claims and the trial judge,
substantially interferes with the landowner’s “reasonable,
investment-backed expectations.
‘The instant action is markedly different from Graham v.
Estuary Properties, Inc., 399 So.2d 1374 (Fla. 1981), cert. denied,
50 U.S.L.W. 3441 (Nov. 30, 1981), because Graham involved state
regulations enacted before the development was commenced.
A. Nature of the Real Property at Issue
In 1964, Deltona purchased approximately 10,000
acres of coastal land in southwest Florida for the express
and, at that time, very reasonable purpose of constructing
a master-planned waterfront community called Marco
Island. Actual development was phased, and the island
was divided into five separate permitting areas. This
was done because the whole community could not be
built in three years, the duration of Corps permits.
(Pl. Ex. 337)
As shown on the above map, the first three permit
areas (called Marco River, Roberts Bay, and Collier
Bay), which are now completed, adjoin each other on
several thousand acres of land constituting the western
part of Marco Island. The last two permit areas — Barfield
Bay and Big Key—adjoin each other on the eastern
part of Marco. The Barfield Bay and Big Key permit
areas, which the Corps prohibited from development,
comprise approximately 2,150 acres of land subject to
Corps jurisdiction.®
In its permitting process, the Corps treated each
of these permit areas as a separate entity. A different
permit application was submitted for each separate
area, and Corps policy dictated that each permit area
be considered on its individual merits. In specific reference
to the Barfield Bay and Big Key permit areas now at
issue, the Chief of Engineers stated, “Both of these
permit applications have been evaluated on their
individual merits.”
The permits for Barfield Bay and Big Key were
denied by the Corps in 1976 to preserve them in their
natural state. Because federal regulations compel these
permit areas to be kept in their natural state, there is
no economically viable use for them, and they are
economically valueless and unmarketable.* They have
‘Barfield Bay and Big Key also contain about 111 acres of
uplands that were not within the Corps’s jurisdiction and were
not included in Deltona’s permit applications. Because the Corps
has no jurisdiction, these 111 acres could be developed and sold
irrespective of Corps permits or requirements; therefore, Deltona
claimed no taking of this acreage. It was this acreage outside
Corps jurisdiction, however, in addition to other separate lands
that had received permits, that the Court of Claims held to be a
defense to the Corps’s taking of the Barfield Bay and Big Key
permit areas.
Deltona's legal theory throughout this litigation has been
that all “economically viable use” of its property has been destroyed,
under the theory of Penn Central Transp. Co. v. City of New York,
438 U.S. 138 (1978), and Benenson v. United States, 548 F.2d 939
(Ct. Cl. 1977). Deltona has never asserted, as was mistakenly
stated by the Court of Claims, that it is entitled to recovery
because it has lost the “highest and best use” of its property.
been effectively acquired for the public not by the
constitutional method of fee purchase, but rather by
application of federal land-use regulations prohibiting
all economic use.
Virtually all the real property at issue is “fast
lands,” ie., property landward of the mean high water
line. In this case, however, the government has attempted
to brand all of Deltona’s ownership—regardless of its
actual nature—as “public waters.” (See, e.g., Government’s
Opening Statement, T. 1386-87, 1389.) Such a description
is erroneous. Deltona’s property above mean high water
is land land that you can walk on and that is covered
with a forest of mangrove trees. (See photograph of
typical mangrove area at Marco, App. A-181.) Because
this land contains mangroves and often has wet soil, it
was administratively defined by the Corps in 1975 to
be “wetlands,” and therefore “navigable waters” under
Section 404 of the Federal Water Pollution Control Act
Amendments of 1972 (“FWPCA”), 33 U.S.C. §1344 (1976).
As applied to Deltona’s fast lands, the term “navigable
waters” is a pure legal fiction: The real property at
issue is neither navigable, nor water, nor public. After
application of the regulations at issue, the real property
at issue has no economic value.
B. Planning of Marco Island
Deltona initiated master planning for Marco Island
in 1964, and completed master planning for all permit
areas, including Barfield Bay and Big Key, in 1965. The
master plan provided for a free-standing community
consisting of more than 12,000 single-family homesites,
numerous multi-family sites, school and park sites,
commercial sites, shopping areas, boating access and
beach areas, arterial transportation routes, and other
planned community facilities. (See aerial photograph
showing typical developed area of Marco, App. A-182.)
Deltona’s development plan was typical of coastal
development in Florida until the 1970’s. From Marco
Island’s inception, the Corps had detailed knowledge
about and made frequent inspections of the development.
Federal officials were actually involved in some of the
planning of Marco Island,’ and the development plan
was praised by the federal government in 1967 as “a
good example of providing the best protective devices
for fish and wildlife.” Interior Department Memorandum,
App. A-168.
C. New, Increasingly Complex and Rigorous Federal
Regulations
This case is marked by the rapid expansion of
“increasingly complex and rigorous” federal regulations
restricting land use, which were applied to Deltona’s
development many years after its inception. See Slip
Op. at 5, App. A-138. When Deltona purchased Marco
and began making irreversible commitments and financial
investments, Corps permits were considered routine,
like building permits. The Corps regulated only those
activities occurring waterward of mean high water and
considered cnly navigation in granting or denying
permits.“
Beginning about 1970, the Congress began
broadening environmental and land-use restrictions
Interior Department Memorandum, Pl. Ex. 67, App. A-168;
see Interior Department Memorandum, Pl. Ex. 87, App. A-169.
The Corps’s statutory authority at that time was Section 10
of the Rivers and Harbors Appropriation Act of 1899, 33 U.S.C.
§403.
dramatically.’ Despite this broadened regulatory authority,
however, the Corps did not exercise jurisdiction over
fast lands such as those at Barfield Bay and Big Key
until mid-1975, when a district court ordered it to do
so. See Natural Resources Defense Council v. Callaway,
392 F.Supp. 685 (D.D.C. 1975). Accordingly, eleven years
after Deltona began Marco, the Corps revised its
regulations to include fast lands as “navigable waters”
within its jurisdiction under Section 404 of the FWPCA.”
D. The Corps’s 1969 Authorization for Deltona To
Advertise and Offer for Sale the Lands at Issue.
Under Deltona’s phased development plans, “Marco
River” was the first permit area scheduled for
development. All necessary permits for this area, including
Corps permits, were obtained in 1964. The second permit
area was “Roberts Bay,” which received a Corps permit
in 1969. During processing of this permit, the Corps
required Deltona to provide a detailed written history
and status of future sales and development of the entire
Marco community.
After several meetings between Deltona and the
Secretary of the Army’s staff regarding those plans
In addition to the FWPCA amendments in 1972, Congre ;
enacted the Marine Protection, Research and Sanctuaries Act of
1972, 33 U.S.C. §1401; the Marine Mammal Protection Act of 1972,
16 U.S.C. §1361; the Coastal Zone Management Act of 1972, 16
U.S.C. §1451; the Endangered Species Act of 1973, 16 U.S.C.
§1531; the Flood Disaster Protection Act of 1973, 42 U.S.C. §4001;
and the Deep Water Port Act of 1974, 33 U.S.C. §1501.
“Only after the Corps held its public hearing on the Barfield
Bay and Big Key permit applications on September 2-3, 1975, did
EPA promulgate its “Section 404(b) guidelines,” which were relied
on so heavily by the Chief of Engineers in denying Deltona's
permits.
and future sales, the Secretary of the Army’s office
drafted several conditions in the Roberts Bay permit.
The most important of these conditions was Condition
“ee,” which restricted Deltona’s future lot sales to certain
areas designated by the Corps. The Barfield Bay and
Big Key permit areas—now before the Court— were
intentionally designated by the Secretary of the Army’s
office as parcels Deltona could continue to advertise
and offer for sale:
“Permittee agrees that it will advertise or
offer for sale to the general public only parcels
of land landward of bulkhead lines that have
already been established by the State of Florida
. . . and for which a plat and suitable
performance bonds have already been filed
with the county te., Barfield Bay, Big Key,
and Collier Bay,.“
The uncontroverted evidence at trial showed that
Condition “cc” was reasonably understood to be a
recognition that the real property at issue had been
platted and bonded and was being sold, and that Deltona
was authorized to continue selling in those platted
areas (ie., Barfield Bay and Big Key), but in no other
place.” From 1969 to date, Deltona has not sold lands
"Inexplicably, the Court of Claims’ opinion quoted part of
Condition “cc” but failed to mention the language quoted above,
ie., the provision actually authorizing Deltona to advertise and
sell lots in the remaining platted and bonded areas of Marco. That
passage, however, is critical. See App. A-166.
"Even the Court of Claims recognized that Deltona had a
“reasonable investment-backed expectation with respect to Barfield
Bay and Big Key.” Slip Op. at 13, App. A-150. Condition “bb”
advised Deltona “that future applications for a permit or permits
in the general area of the proposed work by [Deltona] or others
{would not necessarily be] granted.” Reading Conditions “bb” and
10
at Marco other than those authorized by the Corps in
Condition ce.“
E. Federal Involvement in State Development
Approvals
Believing that the Condition cc“ authorizations
had resolved its permitting problems with the federal
government, Deltona sought a similar overall resolution
with the State of Florida. Federal officials participated
extensively in negotiations for an agreement with the
State and emphatically urged that the Marco situation
be resolved. (See App. A-173 to A-178.) A “State
Settlement” was entered into by Governor Askew and
Deltona, obligating Deltona to convey more than 4,000
acres of preservation land to the State; in return, the
State agreed to issue dredge and fill permits for the
remainder of the community already platted, including
Barfield Bay, Big Key, and Collier Bay.
F. The Corps’s Decision Prohibiting Use of the Real
Property at issue
In March of 1973, Deltona filed separate permit
applications with the Corps for the Barfield Bay, Big
Key, and Collier Bay permit areas. Despite finding
there would be no adverse impact on either navigation
or water quality, the Corps district engineer recommended
(Footnote 12 Continued)
“ee” together, Deltona reasonably understood Condition “bb” to
mean that it might never receive a permit to develop other areas
that had not already been platted within the terms of Condition
“ec,”
“The district engineer expressly found that Deltona had complied
with all state and federal land-sales regulations.
11
that the Barfield Bay and Big Key permits be denied
because of his determination that Deltona’s mangrove
lands should be preserved in their natural state."
The Deltona file was then sent to the division
engineer in Atlanta, who recommended that all three
permits be issued because denial of permits for Barfield
Bay and Big Key would “constitute a substantial and
unwarranted taking of property rights.” (App. A-165)
The case next proceeded to the Chief of Engineers,
who commended Deltona for its response to the swiftly
changing environmental movement (App. A-166), but
nevertheless determined that the Barfield Bay and Big
Key permit areas should be preserved in their natural
state because of “overriding national factors of the
public interest.”
G. Impact of the Corps’s Decision on Deltona’s Real
Property
The effect of the Corps’s decision to preserve the
Barfield Bay and Big Key permit areas was to prohibit
all economically viable use of the property, render it
unmarketable, and push Deltona to the edge of
bankruptcy.” Maintaining such lands in their natural
state for perceived environmental values is the underlying
purpose of the federal regulatory program at issue.
Counsel for the government even went so far as to
instruct its appraiser to assume that “the law prohibits
any uses of that property.” (T. 2248)
“He also recommended that the Collier Bay permit be issued.
See selected comments of district engineer at App. A-163.
As a direct result of the denial of permits for the Barfield
Bay and Big Key permit areas, Deltona suffered such severe
economic injuries that it has simply not received a reasonable,
economic return from the Marco development as a whole, including
land sales in the other permit areas. Deltona's expenditures for all
12
Realizing that no reasonable beneficial use could
be made of the Barfield Bay and Big Key permit areas,
Deltona filed this action under the Tucker Act, 28 U.S.C.
§1491, seeking just compensation for a taking by
regulation. After a two and one-half week trial, the
trial judge found that Deltona was entitled to just
compensation for the taking of the real property at
issue because:
1. “Deltona made substantial and far-reaching
investments . with the reasonable
expectation that it would be able to complete
development of the entire community,
including the Barfield Bay and Big Key
areas.”
2. “Under the particular facts of this case,
the economic impact of the application of
Federal wetlands regulations and the
resulting interference with Deltona’s distinct
investment-backed expectations have had
an unduly harsh impact, not only upon
Deltona and its use of its property, but
also upon those who purchased the lots
from Deltona in expectation of establishing
their homes on those lots.”
(Footnote 15 Continued)
of Marco through 1976 were about $164,000,000, and it incurred
additional direct, identifiable costs of at least $35,600,000 from
permit denial. T. 685-88. Its stock plummeted and trading was
suspended by the SEC; further, Deltona lost other valuabie properties
through forced sales, trades, and refunds. See Findings 113, 124.
And even though transferable development rights (TDRs) might
have value in some areas (such as New York City, see Penn
Central, 438 U.S. at 137), the record herein shows that TDRs in
this case were of little if any value because they were unmarketable
and too speculative. Findings 158-65.
13
3. “Under the particular facts of this case,
the Federal scheme of wetlands regulations
as applied to plaintiffs ongoing development
has denied plaintiff all reasonable,
economically viable use of its property.”
4. “The Government’s action, if allowed without
compensation, has the effect of compelling
Deltona to preserve the real property at
issue for public benefit and environmental
preservation purposes without
compensation.” [Trial Judge’s Opinion at
102-03, App. A-128-29.]
5. “(Djefendant has, in effect, made the property
an adjunct to land it already acquired by
eminent domain, namely the Everglades
National Park and the National Big Cypress
Park, but without compensating Deltona.”
[Trial Judge’s Opinion at 56, App. A-58.]
Although the Court of Claims did not expressly
reject the trial judge’s findings of fact,"* it rejected his
recommended conclusion of law that Deltona was entitled
to just compensation. The court found that because the
federal government had left Deltona with some other
separate property that had value, there was no taking
of the real property at issue.
“The court said, “While the trial judge also made findings of
fact, all the findings necessary to the rendering of this decision
are contained herein.” Slip Op. at 1 n.1; App. A-133. The court
made no findings as to the Barfield Bay and Big Key permit areas,
but rather considered other separate permit areas and the 111
acres outside Corps jurisdiction. Under Court of Claims Rule
147(b), “findings of fact made by the trial judge are presumed to
be correct,” and they are entitled to “great weight.” See Eastern
School v. United States, 381 F.2d 421, 435 (Ct. Cl. 1967).
14
REASONS FOR ALLOWANCE OF THE WRIT
The decision below conflicts with the principle set
forth in the Ninth Circuit’s decision in American Savings
and Loan Association v. County of Marin, 653 F.2d 364
(9th Cir. 1981), to the effect that the fact that a claimant
owns other adjoining property which has value does
not bar recovery of just compensation for destruction
of the use and value of separate land. That principle is
also obviously assumed in a number of decisions of this
Court.
The question whether the federal government can
take a separable part of a large area without paying for
it because other parts of the area that are not taken
retain some economic value, presents a question of
obvious general importance. If allowed to stand, the
Court of Claims’ holding will significantly alter the
logic and fairness of the developing body of inverse
condemnation law.
The Court Of Claims Erroneously Held That
There Is No Taking When All Fronomically
Viable Use Of Land Is Destroyed, So Long As
The Landowner Retains Other Separable Land
That Has Economic Value
In denying compensation to Deltona for a taking
of its 2,150 acres of land in the Barfield Bay and Big Key
permit areas, the Court of Claims held that inverse
condemnation will not lie if a claimant owns any other
separable property that retains economic value. The
injustice of allowing some property to be confiscated
without payment solely because a person also owns
other property, is clear. The court below mistakenly
15
relied on a factually distinguishable case, and its hoiding
conflicts in principle with a recent Ninth Circuit decision
and is contrary to several decisions of this Court.
A. The Court of Claims’ Decision Conflicts with the
Principle Set Forth in a Recent Decision of the
Ninth Circuit
The Court of Claims’ erred when it held that there
can be no taking of separable property where the
landowner owns any other property with value. In his
classic article on inverse condemnation, Professor
Michelman addressed the question as to whether one
“property” could be geographically divided into separate
parcels for taking purposes:
“Let us suppose that I own a tract of unimproved
land. Is the land necessarily one ‘thing’ for
this purpose, or might it be several? Can it,
for example, ever be regarded as geographically
divided into more than one thing? Evidently,
it can be; for, if we imagine government's
practically forbidding me any use of a
geographically determined quarter of my farm,
it is not likely that the obligation to compensate
can be escaped by the argument that only a
quarter of the value of the ‘thing’ has been
destroyed.
Professor Michelman's conclusion that property can be
geographically divided is inescapable because to deny
payment for the taking of one tract of land simply
because other parcels supposedly retain value contravenes
"Michelman, Property, Utility, and Fairness: Comments On
The Ethical Foundations Of “Just Compensation” Law, 80 Harv.L.Rev.
1165, 1192-93 (1967).
16
the most basic notions of justice and fairness. That,
however, is precisely what the Court of Claims did
below.
Furthermore, the Court of Claims’ holding that all
property ownership—even separable tracts that have
been treated differently — must be considered in a taking
case, also conflicts with the principle announced by the
Ninth Circuit Court of Appeals in American Savings
and Loan Association v. County of Marin, 653 F.2d 364
(9th Cir. 1981). In American Savings, the claimant owned
two contiguous parcels of land: one, a twenty-acre tract
called “the Point”; the other, a forty-eight acre tract
called “the Spit.” In 1974, the county down-zoned the
Spit to one multiple residential unit per five acres and
rezoned the Point to four multiple residential units per
acre. The landowner sued for a taking of the 48 acre
Spit. Although conceding that the Point had not been
taken because it could be economically developed, the
landowner maintained that there was no economically
feasible use for the adjoining Spit. The district court,
like the Court of Claims below, held the two adjoining
properties to be a single parcel for taking purposes and
found no taking.
On appeal, the Ninth Circuit reversed and determined
that a taking will not be barred merely because the
claimant owns adjoining tracts of land. Because American
Savings involved two adjoining parcels that had been
treated separately by the government, the Ninth Circuit
distinguished Penn Central Transportation Co. v. City
of New York, 438 U.S. 104 (1978), which involved the
claimant’s attempted division of air and surface rights
in one city block that had been treated uniformly by
the government:
17
“In Penn Central, the Landmarks Preservation
Commission declined to permit a proposed
building over the plaintiffs entire property.
The challenged government action had not
divided the property into discrete segments,
and the courts refused to do so. The question
here is whether the challenged ordinance creates
two separate parcels for taking purposes by
adopting different zoning designations for each
parcel.””
In Deltona’s case, the Barfield Bay and Big Key
permit areas were treated as separate parcels by the
Corps—each had a separate permit application and
each was considered on its individual merits. Under
American Savings, therefore, properties adjoining Barfield
Bay and Big Key should not be included in a taking
analysis.
The Court of Claims’ decision that a taking is
barred when the claimant owns other separable property,
was mistakenly based on Penn Central, 438 U.S. at
130-31. In Penn Central, the “discrete segments” this
Court refused to separate were the surface rights and
air rights in one city block, not (as in Deltona’s case) all
rights in several large and physically distinct tracts of
land. The company in Penn Central sought to distinguish
between surface and air rights in a small parcel that
had been treated uniformly by the city’s landmark
designation law, ie., the Landmarks Commission refused
to permit certain construction above the company’s
entire property (the city tax block containing Grand
"653 F.2d at 369-70. The claimant had not yet submitted
specific development plans, so the court could not determine
whether the county would in fact treat the Point and Spit separately.
Id. at 372. The case was therefore reversed and remanded.
18
Central Station). The Court held no taking had occurred
because the company was receiving a reasonable economic
return from Grand Central Station.“ The Court also
stated that the company might still be allowed to develop
some portion of the air rights above the Terminal because
the record did not suggest that no construction would
be allowed.”
Conversely, Deltona’s case concerns not simply air
and surface rights in a city block, but large, physically
distinct tracts of land that have been treated separately
and differently by the Corps. Unlike Grand Central
Station, there is no economic use, let alone a reasonable
return, for the Barfield Bay and Big Key permit areas.
Thus, Penn Central was misapplied in this case. The
fact that other areas owned by Deltona supposedly
have economic value is no bar to recovery for the
destruction of all use of the separable Barfield Bay and
Big Key permit areas.
438 U.S. at 137. The Court added that if the company could
show there was no economically viable use of the Terminal in the
future, a taking might be found. Id. at 137, n.36. It is noteworthy
that although Penn Central owned other separate properties near
Grand Central Station (five hotels, several office buildings, and
the Yale Club, see id. at 115), this Court did not consider them in
its taking analysis.
The existence of specific development plans in Deltona's
case distinguishes it from Agins u City of Tiburon, 447 U.S. 255
(1980). Unlike Deltona, the Agins landowners never even submitted
an actual development plan for approval, and they did not spend
12 years attempting to get final development approvals. Agins
thus represented merely a taking challenge to the local ordinance
on its face. Jd. at 260.
19
B. The Court of Claims’ Decision Is Contrary to Several
Decisions of This Court
Although this Court has not expressly addressed
the question as to when two parcels should be considered
separately for taking purposes, the Court of Claims’
decision is at least implicitly inconsistent with several
Supreme Court decisions, including that last Term in
San Diego Gas & Electric Company v. City of San
Die go. U.S. ___, 101 S.Ct. 1287 (1981). The claimant
in San Diego Gas acquired 412 acres of land in 1966 for
possible development in the 1980s; approximately 214
acres of this area was located in or near an estuary.
In 1967, San Diego adopted a master plan designating
the entire 412 acres as industrial. Several years later,
however, the city down-zoned 39 acres from industrial
to agricultural use and redesignated another 233 acres
as “open space.” The landowner sued for a taking of
214 acres of its land, even though it owned 412 contiguous
acres, because the use of those 214 acres had allegedly
been destroyed by the zoning ordinance. The Court
noted these facts and expressly noted that the rest of
the 412 acres had been sold or developed. Id. at 1289-90.
It is implicit in San Diego Gas that a claimant may use
or sell portions of a tract of land and still assert a
taking of other portions of that tract.”
Similarly, Kaiser Aetna u United States, 444 U.S.
164 (1979), shows that it is not necessary to consider all
*The majority did not reach the taking issue, because the
Court lacked jurisdiction over the case for the absence of a final
judgment. A four-member dissent also accepted the landowner's
description of the “taken” property and found a taking by regulation
on the merits; Justice Rehnquist concurred in the majority opinion
as to jurisdiction, but agreed “with much of what is said in the
dissenting opinion.” 101 S.Ct. at 1294.
20
property ownership in a taking action. In Kaiser Aetna,
the Corps tried to create a public aquatic park by
forcing the developer of a residential community to
allow public access to the development’s private marina.
The marina was located in a 523 acre pond that historically
had been considered private property. Although the
developer owned and had already developed several
thousand acres around the pond, it claimed a taking of
only the 523 acre pond. This Court recognized the
ownership of the entire development, but addressed
the taking issue only with respect to the pond. The
Court found the Corps’s actions toward the pond would
amount to a taking. Unlike the Court of Claims below,
this Court did not hold that there was not a taking
because the claimant owned and had developed other
lands in the same development.
The Court of Claims’ error is also apparent from
Nectow u City of Cambridge, 277 U.S. 183 (1928), involving
a due process challenge to a zoning ordinance. The
Nectow landowner owned a tract of land containing
140,000 square feet. Of that total, 29,000 square feet
were zoned residential, with business and industry
excluded; the remainder was unrestricted. The special
master below found that no practical use could be
made of the property zoned residential because no
adequate return on investment was possible. The Court
considered the 29,000 square feet of land as the “locus
in question,” and, because the zoning ordinance had
destroyed their use, the Court invalidated the ordinance,
even though the remainder of the property apparently
had economic value.
Deltona finds itself in the same position as Professor
Michelman’s farmer, who lost a quarter of his farm to
the government. The Barfield Bay and Big Key permit
areas have been preserved in their natural state for
21
the benefit of the public. The Court of Claims, however,
held that there is no taking if a landowner retains any
other land of value. If not corrected by this Court, the
Court of Claims’ decision will adversely affect taking
law and will have impacts well beyond Deltona’s mangrove
lands in Florida. Deltona therefore respectfully requests
that a writ of certiorari issue to review the decision of
the Court of Claims below.
II.
The Court Of Claims Improperly Sanetioned
The Use Of Federal Wetlands Regulations To
Preserve Property By Regulation Instead Of
Purchase
It is difficult, if not impossible, to distinguish between
the Corps's purpose in preserving Deltona's
environmentally valuable land by regulation, and the
federal government's program to preserve several
hundred thousand acres of similar environmentally
valuable lands in the nearby Big Cypress National
Preserve by purchase.” The only difference is the method
of preservation: purchase of the fee in the Big Cypress
versus uncompensated regulation in the mangrove lands
at Marco. Deltona has suffered a loss of all economic
use of its property. But unlike its neighbors owning
land in areas purchased by Congress, Deltona has received
nothing for the taking of its land by regulation. Such
consequences are clearly inconsistent with the justice
"Big Cypress, 16 U.S.C. §698(f). Congress has specifically
designated numerous coastal areas having environmental values
comparable to Marco as national parks or wetlands preserves and
has compensated affected landowners. E.g. Cape Hatteras; 16
U.S.C. §459(a); Cape Cod, 16 U.S.C. §459(b); and Point Reyes, 16
U.S.C. §459(c).
and fairness guarantee of the Fifth Amendment. See
Armstrong v. United States, 364 U.S. 40, 48-49 (1960).
This action, in many ways, is quite similar to Kaiser
Aetna v. United States, 444 U.S. 164 (1979), in which
the Corps sought to impose broad federal powers on a
previously started development in order to require
public access. This Court held that such federal actions
would destroy a fundamental property right —the right
to exclude others— and would amount to a taking.
Deltona’s taking case is even more compelling than
Kaiser Aetna because the federal regulations in Deltona’s
case go farther than destroying merely the right to
exclude: The federal regulatory scheme applied in this
case extinguishes all reasonable, economically viable
use of the real property at issue and in fact has been
used as an alternative to purchase for the outright
preservation of property for the public benefit.
Denial of Deltona’s permits was based on a desire
to preserve Deltona’s mangrove lands. It was not based
on the protection of navigation, because the development
of Barfield Bay and Big Key would have enhanced
navigation. Likewise, the decision was not based on
any potential for adverse impacts to water quality. The
district engineer expressly acknowledged that water
quality was not a problem, and the State of Florida
certified that Deltona would comply with applicable
water quality standards under Section 401 of the FWPCA.
In Deltona’s case, the Corps made a specific land-
use decision that residential housing - the purpose for
which the property was purchased, master planned.
and platted in the mid 1960’s— was an inappropriate
use of such lands in 1976, and that they should be
23
preserved in their natural state.“ Under these
circumstances, it can be seen that the federal government
intentionally used its regulatory program to avoid the
expense of fee acquisition by purchase. The trial judge
so found:
Deniai of dredge and fill permits by the Corps
has been employed as a means of conserving
mangrove growth for the public benefit without
acquisition of title to the property.” [Finding
#141]
More important, the Corps has expressly admitted
that the Section 404 wetlands program can be used as
an alternative to fee acquisition. In a 1979 General
Accounting Office report, the Comptroller General
criticized the Park Service’s purchase of 570,000 acres
of swampland in the Big Cypress preserve near Marco
Island, because:
“(T]he Park Service could protect this swampland
through the Federal Water Pollution Control
Act of 1972 which prohibits putting dredged
or fill material into a water without
aurthorization from the Army Corps of Engineers
Corps officials stated there was certainly
the potential to use the permit program as an
alternative to fee acquisition while still
preventing development or damage to the
resource.” [Report by the Comptroller General,
The Federal Drive To Acquire Private Lands
See Drakes Bay Land Co. u United States, 424 F.2d 574 (Ct.
Cl. 1970), in which a taking was found where the federal government
similarly prevented private use of lands, to incorporate them into
the Point Reyes National Seashore. See also vegetation and land-
use map showing similarity of the real property at issue to
surrounding areas, App. A-179.
24
Should Be Reassessed, CED 80-14, at p. 54,
December 14, 1979; Pl. Ex. 355 (Emphasis
supplied)]
Using its permit program as an alternative to
purchase is exactly what the Corps has done at Marco.
The imposition of such severe restrictions on property
in order to create a public benefit, however, clearly
places a disproportionate share of the “public burdens”
on a single landowner.” The trial judge recognized this
inequity:
“{D]efendant has, in effect, made the property
an adjunct to land it already acquired by eminent
domain, namely the Everglades National Park
and the National Big Cypress Park, but without
compensating Deltona.” [Trial Judge’s Opinion
at 56, App. A-58, emphasis supplied.]
The Court of Claims, on the other hand, in denying
compensation to Deltona, has allowed the Barfield Bay
and Big Key permit areas to be preserved in their
natural state for the public benefit. The federal
government’s use of its wetlands regulatory program
as an alternative to purchase of lands for the public
benefit clearly contravenes the justice and fairness
guarantee of the Fifth Amendment.
CONCLUSION
The special significance of the protection afforded
to property rights by the Constitution was explained
by this Court in Lynch v. Household Finance Corp., 405
U.S. 538, 552 (1972):
See Penn Central, 438 U.S. at 124; Dunham, A Legal and
Economic Basis for City Planning, 58 Col.L.Rev. 650, 665 (1958).
25
“(T]he [supposed] dichotomy between personal
liberties and property rights is a false one.
Property does not have rights. People have
rights. The right to enjoy property without
unlawful deprivation, no less than the right to
speak or the right to travel, is in truth a ‘personal’
right, whether the ‘property’ in question be a
welfare check, a home, or a savings account.
In fact, a fundamental interdependence exists
between the personal right to liberty and the
personal right in property. Neither could have
meaning without the other.”
Absent review by this Court, the decision below will
erode those constitutionally protected rights and distort
the developing body of inverse condemnation law.
For the foregoing reasons, Deltona respectfully
requests that a writ of certiorari issue to review the
decision of the United States Court of Claims.
Respectfully submitted,
WILLIAM LOUIS EARL,
Counsel of Record
WILLIAM F. TARR
PEEPLES, EARL, MOORE
& BLANK
One Biscayne Tower, Suite 3636
Two South Biscayne Houlevard
Miami, Florida 33131
Telephone: (305) 358-3000
Attorneys for Petitioner
December, 1981
Office -Sispreme Court, US
ILED
DEG 29 198)
N
8 1 - 1 2 0 7 ALEXANDER L STEVAS
; CLERK
in the *
Supreme Caurt
of the
United States
OCTOBER TERM. 1981
THE DELTONA CORPORATION.
Petitioner,
vs.
UNITED STATES OF AMERICA,
Respondent.
APPENDIX TO
PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF CLAIMS
WILLIAM LOUIS EARL,
Counsel of Record
WILLIAM F. TARR
PEEPLES, EARL, MOORE & BLANK
One Biscayne Tower, Suite 3636
Two South Biscayne Boulevard
Miami, Florida 33131
(305) 358-3000
Attorneys for Petitioner
December, 1981
TABLE OF CONTENTS
Page
A. Opinion, Findings of Fact, and Conclusion of
Law of the United States Court of Claims
D vc cavauen cis ed cen beeebeatede A-1
B. Opinion of the United States Court of Claims . A-132
Order of the Court of Claims Denying Deltona’s
Motion for Rehearing ................... A-156
C. Constitutional Provisions, Statutes, and
Regulations Involved ................... A-157
1. United States Constitution, Amendment
2. Section 404, Federal Water Pollution
Control Act Amendments of 1972, 33
U.S. C. A. 51344 (1975) ................ A-157
3. Section 401, Federal Water Pollution
Control Act Amendments of 1972, 33
U.S. C. A. §1341 (1975ᷣ 777 A-158
4. Section 10, Rivers and Harbors
Appropriation Act of 1899, 33 U.S.C.A.
§403
TABLE OF CONTENTS (Continued)
5. Regulations of Army Corps of Engineers,
33 C.F.R. §209. 120 (40 Fed. Reg. 31320,
, ̃ T A-160
Definition: “Navigable Waters of the
United States,” 33 C.F.R. §209.120(dX1)
(40 Fed. Reg. 31324) .............. A-160
Definition: “Navigable Waters,” 33
C.F.R. §209.120(d)\(2\iXb) and (d) (40
rr... re A-161
Favorable State Determinations, 33
C.F.R §209.120(f3\iii) (40 Fed. Reg.
r A-161
Corps Policy Regarding Wetlands,
33 C. F. R. 5209. 1204g 03 Ni) and (iv) (40
Fed. Reg. 313280)))i- A162
D. Pertinent Documents and Exhibits From the
rr ee eed A-163
1.
Excerpts from Corps Decision-Making
Documents (From Administrative Record). A-163
District Engineer's Comments
Regarding Navigation, Water Quality,
and Deltona’s Sales (Vol. I, Incl. I,
SC sdvechssceeet cawnes tin A-163
TABLE OF CONTENTS (Continued)
Page
b. Division Engineer’s Statement That
Permit Denial Would Render Deltona’s
Property Practically Worthless And
Would Amount To A Taking (Vol. V,
D ccvacesecsseenes A-165
ce. Chief of Engineers’ Statement
Commending Deltona For Its
Response To The Environmental
Movement (Vol. V. Inci. VII, p. 43) .. A-166
Conditions “cc” and “bb” of the Roberts
D um! 8 A-166
Interior Department Memorandum
Praising Marco Development For
Protecting Fish and Wildlife and
Discussing Federal Planning Assistance
(February 24, 1967) (Plaintiff's Exhibit
——A ĩðâW» . A-168
Interior Department Memorandum on
Planning Discussions with Deltona
(February 28, 1969) (Plaintiff's Exhibit
.. . A-169
Restricted-Confidential Interior
Department Memorandum Describing
Federal Involvement in State Settlement
(August 11, 1971) (Plaintiff's Exhibit 117). A-173
TABLE OF CONTENTS (Continued)
6. Assistant Secretary of Interior's
Memorandum Urging Resolution of Marco
Problem and Discussing Federal
Involvement (August 20, 1971) (Plaintiff's
BED GED os vo e . A-177
7. Trial Exhibits Showing Location and
Nature of Marco Island Development .. A-179
a. Map Showing Location of Marco in
Relation to Mangroves Remaining
In Southwest Florida (Plaintiff's
3 ee A-179
b. Map Showing South Florida Lands
Under State And Federal Manage-
ment (Plaintiff's Exhibit 264) A-180
e. Photograph Showing Typical
Mangrove Area at Marco. (April 8,
1980) (Plaintiff's Exhibit 338-14) .... A-181
d. Aerial Photograph Showing Typical
Developed Portion of Marco Island.
(April 16, 1980) (Plaintiff's Exhibit
JJ ĩ A-182
iv
Received DEC. 1 1980
Peeples, Earl, Smith, Moore & Blank, P.A.
IN THE UNITED STATES
COURT OF CLAIMS
TRIAL DIVISION
No. 370-76
(Filed: November 25, 1980)
THE DELTONA CORPORATION
vs.
THE UNITED STATES
Taking, Inverse Condemnation; Dredge and Fill Permits;
Corps of Engineers and EPA Jurisdiction; Commerce
Clause; Eminent Domain; Preservation or
Conservation (Ecological) Easement; Highest and
Best Use; Public (National) Interest Versus Private
Property Right
William L. Earl, attorney of record, for plaintiff.
Fred R. Disheroon, with whom was Assistant
Attorney General James W. Moorman, for defendant.
Nancy J. Marvel, of counsel.
A-l
William Butler, counsel for The Environmental
Defense Fund, Inc., National Audubon Society, Inc.,
Florida Audubon Society, Inc., and Collier County
Conservancy, Inc., amicus curiae.
OPINION*
BROWNE, Trial Judge: This is an action by The
Deltona Corporation (Deltona), for recovery of just
compensation under the fifth amendment to the
Constitution of the United States for defendant's alleged
taking, by inverse condemnation, of Deltona’s real property
as a consequence of the denial by the defendant of
Deltona’s application for a permit under Section 10 of
the River and Harbor Act of 1899 (33 U.S.C. §403) and
Section 404 of the Federal Water Pollution Control Act
Amendments of 1972 (FWPCA) (33 U.S.C. §1344)' to
dredge and fill in certain areas owned by Deltona in
Collier County, Florida, for the purpose of continuing
the development of a partially completed, master planned
“finger-fill” or “canalized” residential community known
as “Marco Island.”
*The opinion and conclusion of law are submitted in accordance
with Rule 134(h).
‘All references to FWPCA herein refer to the act, as amended
in 1972 unless otherwise indicated.
A-2
I. Jurisdiction
Jurisdiction of this court is invoked under the
provisions of 28 U.S.C. §1491.
II. The Issue’
The basic issue presented is whether, as a
consequence of implementation by the U.S. Corps of
Engineers (the Corps) (in collaboration with the
Environmental Protection Agency (EPA) and other
Federal agencies) of Section 10 of the River and Harbor
Act of 1899, as amended (33 U.S.C. §403) and Section
404 of the Federal Water Pollution Control Act of 1972,
as amended (33 U.S.C. 1344) the Federal Government,
by the denial of a permit to dredge and fill those areas
of Deltona’s property which are above, as well as below
the mean high water (MHW),’ has exercised its regulatory
authority under the Constitution‘ to such an extent
This is one of two copending cases in which the same basic
issue is raised, the other case being James J. Jentgen u United
States, No. 415-77, in which our opinion, findings of fact, and
recommended conclusion of law have been filed on even date
herewith. The subliminal issue in both cases is whether or not
denial of the respective applications for dredge and fill permits
has, in effect, made the respective properties satellite annexes to
the Everglades National Park and the Big Cypress Preserve without
compensating the owners for the property affected by the denial.
Mean high water (MHW) is an abstract term applied to the
arithmetic mean of the highest deviation above mean sea level
which each highest tide has reached at a given location each day
over a period of 18.6 years, thus averaging out variations in tidal
data from day to day, month to month, and year to year over the
18.6-year cycle required for the earth and the moon to return to
their same relative positions in the lunar system.
‘Constitution of the United States, article I, section 8 (commerce
clause).
A-3
that Deltona’s property has been taken without
compensation or the value thereof has been so
substantially diminished that it has been deprived of
the right to make the highest and best use of its property.
Determination of the quantum of recovery, if any,
has been reserved for further proceedings under Rule
131(c), pending final determination of the issue of liability.
We hold for the plaintiff, Deltona. The basis for
our holding is set forth hereinafter.
III. Description of the Property
Deltona purchased a large area of approximately
10,000 acres of uplands, bay bottom, and beach front
property in Collier County, Florida, about 10 miles
south of Naples, Florida, in June 1964 at a cost of
approximately $7,500,000. The property was purchased
for the purpose of developing a water-oriented residential
community. A master plan was developed providing
for a self-sustaining community of 12,000 single-family
homes and some multifamily structures with school,
park, commercial, and recreational sites, as well as the
necessary utilities to serve the needs of the community.
The plan divided the area into five sections, the
development of which was to be phased over a period
of 15-20 years beginning in 1965. The five areas were
named Marco River, Roberts Bay, Collier Bay, Barfield
Bay, and Big Key. The master plan was given all necessary
local, county, and state approvals in 1965 and 1966,
whereupon Deltona proceeded with the development
of the first of the five areas, that being the Marco
River area. It also proceeded with the offering for sale
A-4
and sale of property in all other areas for future
development and construction.
A more detailed description of the vegetation and
ecology of this area will be dispensed with in this
opinion, since it is quite similar to and virtually an
extension of the same type of vegetation which grows
abundantly in the Everglades National Park and is
described more fully in the case of Jentgen v. United
States, No. 415-77 (opinion reported on even date
herewith). However, a reproduction of a National Oceanic
and Atmospheric Administration (NOAA) map appears
at the end of this opinion as Appendix “A” to give a
proper perspective to the area involved in the present
case.
Although the undeveloped property in the Jentgen
case and the property in this case are substantially
similar, the nature of the contemplated dredging and
filling operations differ substantially. The Jentgen tract
was but 100 acres within the city limits of Everglades
City, Florida, at the gateway to Everglades National
Park, whereas the Barfield Bay and Big Key areas of
the Marco Island master-planned community consists
of approximately 2,000 acres within an unincorporated
portion of Collier County, adjacent the previously
developed Marco River and Roberts Bay areas near
the Gulf of Mexico. Whereas the Jentgen project would
not have involved the construction of canals or “finger-
fill” land areas, the Deltona master plan contemplated
extensive use of canals and finger-fill areas wherever
use of the property could be maximized by such
construction. The Jentgen project, on the other hand,
contemplated construction of a small marina and three
small drainage lakes inland of the shoreline of the
A-5
Barron River. The Jentgen project would not require
dredging of navigable waters to provide fill. The necessary
fill would be obtained by excavating low-lying areas
within the property limits and supplementing that
material with fill brought in from an inland borrow
site. The Deltona project, on the other hand, contemplated
use of material dredged from navigable waters, together
with other material excavated from the Deltona property
or brought in from inland borrow sites to form the
navigable canals and to fill the “fingers” upon which
homes, roads, and other facilities would be built.
The common denominator in both cases is the
denial by the Corps of Engineers of a dredge and fill
permit under Section 404 of the Clean Water Act solely
on the ground that the dredging and filling, in each
case, would result in the permanent removal of a
substantial amount of the natural mangrove grewth
which exists on both properties, thereby reducing or
eliminating a source of nutrition for the shell and scale
fish which abound in and around the coastal and offshore
waters of southwest Florida and the Gulf of Mexico.
IV. Deltona’s Development Plans
Deltona’s long-range development plan for the Collier
Bay, Barfield Bay, and Big Key areas was included in
the Marco Island master plan from the outset in 1964-65.
The Marco Island area (the first to be developed) was
primarily a beach community featuring a hotel and
high rise condominiums fronting on the Gulf of Mexico.
The Roberts Bay area (the second to be developed), on
the other hand, was developed inland of the Gulf Coast
between the Marco Island section and the Barfield Bay
A4
section, south of Florida State Road 92. As a consequence
of the geography of the inland areas, the “finger-fill”
and canalized” plan was used extensively in developing
the Roberts Bay section.
When Deltona was ready to proceed with the
development of the Collier Bay, Barfield Bay, and Big
Key areas, having obtained all necessary state and
local permits, it applied for Federal dredge and fill
permits for those areas.
The Collier Bay section was located north of the
Roberts Bay section, also inland but in the vicinity of
the mouth of the Big Marco River. The permit to dredge
and fill in the Collier Bay section was granted,
notwithstanding the fact that it, too, used the “finger-
fill” and “canalized” plan extensively. The permits for
the Barfield Bay and Big Key areas, however, were
denied.
Collier Bay, itself, is approximately the same size
as Roberts Bay but recent (1977) NOAA charts show
that depths in the waters in Collier Bay range from 1
or 2 feet to as much as 12 feet. The same charts show
no depth for Roberts Bay and 2 to 4-foot depths for
Barfield Bay, with many shoals at 1'/2 feet being reported.
The charts show no depths for the waters inland of the
Big Key area but navigable channel depths of up to 24
feet are shown in the Big Marco River which flows
along the north side of Big Key.
The Big Key section lies northeast of the Barfield
Bay section, just across State Road 92 from Barfield
Bay. Both the Big Key and Barfield Bay areas may be
seen clearly as one crosses the bridge westbound on
A-7
State Road 92 over the Big Marco River just north of
Goodland Bay and the small community of Goodland.
Although completion of the Big Key and Barfield
Bay sections would require removal of most of the
mangrove in that area, Deltona will have turned over
to the State of Florida for public use more than 4,000
acres of undisturbed property. Deltona would not be
opening up a remote virgin area of Collier County, but
would merely be extending the development of the
Marco River, Roberts Bay, and Collier Bay sections, as
originally planned.
The bulkheading of the acreage to be dredged and
filled would be comparable to that already installed in
the Marco Island and Roberts Bay areas. Likewise, the
canals would be comparable in length, width, and depth
to those which have already been in use for several
years. The method employed in bulkheading contemplates
sealing off the construction area from the surrounding
navigable waters until the canalizing and finger-filling
has been completed. After completion of the canals, a
passage is opened to the adjacent navigable waters. In
this way siltation of the adjacent navigable waters
during construction is reduced to a minimum.
A comprehensive summary of the development
plans for all of Deltona’s property in the Marco Island
vicinity (including Collier Bay, Barfield Bay, and Big
Key) was required by the Corps to be submitted within
6 months of the issuance of the Roberts Bay permit,“
even though the Collier Bay, Barfield Bay, and Big Key
The Roberts Bay permit was issued on December 8, 1969.
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permit applications were not yet filed. The required
report was submitted to the Corps by letter dated May
18, 1970, well in advance of the due date. It was not
until 18 months later, on November 15, 1971, that state
permit applications were filed by Deltona as a preliminary
step to filing Federal permit applications for the Collier
Bay, Barfield Bay, and Big Key area.
The Corps maintained continuing surveillance over
the development of the Marco Island project from its
beginning in 1965. Deltona, as early as November 25,
1969, furnished the Corps complete plans for development
of the entire area, including areas for which additional
applications for permits would be filed in the future.
The opening paragraph of a letter dated November 25,
1969, to Colonel John T. McElhenny, District Engineer,
stated:
With reference to the pending permit
application #67-762 [Roberts Bay] and in
anticipation of the filing of additional
applications for dredged and fill permits by
Marco Island Development Corporation
[Deltona], we felt it would be beneficial to set
forth in writing, supported by appropriate
exhibits, our plans for the development of all
of Marco Island and its environs, including
lands encompassed by the permit which has
been issued [Marco River]; the pending permit
application [Roberts Bay]; as well as other
lands we intend to develop.
This plan of development was completed and
submitted to the Corps long before the 1972 amendments
to the FWPCA were passed and almost 6 years before
A9
the Corps and EPA promulgated new guidelines for
issuance of dredge and fill permits. The applications
for the Barfield Bay and Big Key permits filed in late
1971 (also before enactment of the 1972 amendments to
the FWPCA) were consistent with the overall plans
disclosed to the Corps in November 1969 and May
1970.
Throughout the planning and development of the
entire area, Deltona leaned over backward to
accommodate the environmental needs of the public by
setting aside preservation areas and deeding large areas
of both land and bay bottom to the State of Florida for
public use. The State of Florida, on the other hand,
conveyed to Deltona some areas to which the State of
Florida held title in order that Deltona could fill landward
of the previously established and approved bulkhead
lines.
In establishing the bulkhead lines, all reasonable
means were employed to follow the vegetation line and
at the same time following a line approximating MHW
in the area. Generally, the deviation from the vegetation
line was not more than 50 feet landward or seaward.
This method of delineating and reclaiming areas covered
by the Swamplands Act of 1850 had been followed in
other areas developed in southwest Florida and, therefore,
was not unique to the Marco Island area.
Deltona submitted its complete development plans
to others besides the Corps. The “Marco Island
Conservation Plan,” submitted to the Corps in May
1970, was also presented prior to May 18, 1970 to:
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State of Florida Trustees of the Internal
Development Fund (Messrs. Apthorp, DuBose
and Vidzes);
Florida Department of Natural Resources
(Messrs. Hodges and Woodburn);
Florida Game and Fresh Water Fish
Commission (Dr. Fry); National Audubon Society
(Mr. Jack Allen);
University of Miami Marine Lab. (Dr. Durbin
Tabb and Mr. Bernard Yokel);
Collier County, Florida (County Manager, Mr.
Harmon Turner and County Engineer, Mr.
Thomas Peek);
Florida Department of Air and Water Pollution
Control (Mr. Nathaniel Reed, Chairman);
Collier County Conservancy (Mr. Joel
Kuperberg), and Nature Conservancy (Mr. Ray
Dasmann).
A basic principle of the plan was to preserve as
much shallow bay-bottom area as possible in its natural,
undisturbed state. In doing so, it was estimated that
approximately 4,100 acres of privately owned bay bottom
and mangrove growth would be dedicated to public
ownership in its natural, undisturbed state.
By the time the Barfield Bay and Big Key applications
were filed, the Marco River area development had
progressed to the point where implementation of the
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original plan could be observed and evaluated. It was
also evident from sales brochures and advertising that
the Barfield Bay and Big Key areas would be developed
as “finger-fill” and “canalized” areas in the future. In
this respect, the Deltona development is distinguishable
from the incipient Jentgen development discussed in
Jentgen v. United States, No. 415-77 (reported on even
date herewith). By the time Deltona filed its Barfield
Bay and Big Key applications, its development of the
master plan was already partially realized and was not
just a speculative matter. Not only had many lots been
sold, but also substantial construction had been completed
in areas for which permits had been granted.
In its May 1970 report of its future plans, Deltona
stated:
The enclosed plan represents a plan to be
carried out over a considerable number of
years. It will not all, obviously, be implemented
at any one time since the area involved is
very large and detailed information will require
much field work and consultation. It is
anticipated that the corporation will proceed
with the implementing of this plan a section
at a time so as to be able to properly apply
the principles that we feel are desirable.
The status of the Deltona development is also distinguishable
from Agins et uz., u City of Tiburon, 100 S.Ct. 2138 (1980). In that
case the property owner had never sought any permits for
development of the five-acre tract to which zoning restrictions
were applied by the City of Tiburon after the owner had purchased
the property. Moreover, after enactment of the ordinance, the city
commenced eminent domain proceedings against the property but
thereafter abandoned those proceedings.
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Many details of the development plans are set
forth in the findings of fact which accompany this opinion.
Much can also be learned about the geography of the
area in relation to the plans from the documentary
evidence, such as defendant's Ex. 37 (an aerial photo of
the Barfield Bay and Big Key areas), particularly when
viewed in conjunction with plaintiffs Exs. 336, 337,
and 342, for example.
The economic considerations involved in the
development plan are also treated in the findings of
fact and need not be elaborated upon in this opinion.
Suffice it to say that Deltona, a publicly held corporation,
invested millions of its shareholders’ dollars and reinvested
its earnings in an effort to complete the development
which it had reasonably expected to complete in
accordance with its master plan. The economic loss
which Deltona will suffer by denial of the Barfield Bay
and Big Key permits cannot be determined with any
degree of accuracy at this stage of the litigation. The
evidence thus far, however, establishes that the denial
has resulted, and will continue to result, in demands by
purchasers for refund of their payments for lots in the
two areas and has caused a reduction in value of the
unsold lots in those areas. In addition, Deltona has
established utilities, roads, schools, businesses, and
recreation facilities on the basis of projected population
which will never materialize due to the denial of the
Barfield Bay and Big Key permits.
In brief, defendant has brought Deltona’s plans for
development of the Barfield Bay and Big Key areas to
a dead halt and, while not directly relevant to this case,
is continuing to thwart Deltona’s plans for development
A-13
of other areas within its master plan for which one or
more permit applications are pending at this time.
V. Permit Application Proceedings
It was not until 1968 when Deltona prepared to
develop the second area, namely, the Roberts Bay area,
that application was made to the U.S. Corps of Engineers
for a Federal permit under Section 10 of the River and
Harbor Act of 1899 to dredge and fill areas within the
Roberts Bay area which at that time were considered
to be subject to the Federal! navigation servitude.’
In seeking approval of the Roberts Bay permit
application, Deltona submitted to the Corps a complete
disclosure of the entire master plan, development status
reports, sales status reports, and other documents,
concerning the entire five-section development.
Whereas the Corps, up to that time, had routinely
granted dredge and fill permits of the type sought by
Deltona.“ increasing pressures were brought to bear
against the Corps to give consideration to environmental
factors, aside from the impact on navigation, in considering
the dredge and fill permit applications. As a consequence
of these additional concerns, certain conditions with
respect to future sales and development in the master
"Inasmuch as none of the property in the Marco River area
required dredging or filling of navigable waters, Federal permits
were not sought for development of that area.
Finger fill or canalized developments were commonplace not
only along the coastal areas, but also in low-lying lands inland
from the coast.
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planned area were set forth in the dredge and fill
permit application granted for the Roberts Bay area.
Deltona was advised that it could not expect to receive
routine approval of future applications for permits to
dredge and fill, but that each application would be
considered on its own merits. Nevertheless, Deltona
was specifically permitted to continue the sale of property
within the planned areas for which dredge and fill
permit applications had not yet been filed.
Deltona, as part of its ongoing effort to implement
its long-range development plan thereafter filed three
applications for dredge and fill permits under Section
10 of the River and Harbor Act of 1899 (33 U.S.C. §403)
and Section 404 of the FWPCA (33 U.S.C. §1344), with
respect to the Collier Bay, Barfield Bay, and Big Key
areas. The three applications (73G-0496, 0497, 0498)
were originally filed on March 2, 1973, and were revised
on March 22, 1973.
The Corps advised Deltona by letter dated July 6,
1973, that the three applications would not be processed
without filing an environmental impact statement as
required by the National Environmental Policy Act of
1969, P.L. 91-190, 83 Stat. 852 (1970) (codified at 42
U.S.C. §4321-47), and a state water quality certification
as required by the Act of April 3, 1970, P.L. 91-224, 84
Stat. 91. Neither of these requirements existed when
Deltona applied for and obtained its previous Federal
dredge and fill permits. Deltona complied with the
Corps’ requirements and submitted further revised
applications on April 15, 1974, including the state water
quality certification which had been granted on April
10, 1974.
A-15
At about this time there was an ongoing dispute
between the Corps and EPA over their respective
jurisdictions of areas above mean high water and over
jurisdiction of other dredging or filling permits which
did not affect navigation but which affected the
environment above as well as below MHW. The Corps
took the position that its jurisdiction over applications
under Section 10 of the River and Harbor Act of 1899
(and Section 13 of the Refuse Act of 1899) was limited
to the traditional tests of navigability and to areas below
mean high water and that Section 404 of the FWPCA
did not enlarge that jurisdiction. The matter was resolved
to the contrary by an unappealed judgment of the
United States District Court for the District of Columbia
on March 27, 1975, in Natural Resources Defense Council,
Inc., et al. v. Callaway, et al, 392 F.Supp. 685 (D.D.C.
1975), (a declaratory judgment action) wherein District
Judge Aubrey E. Robinson, Jr., declared that:
1. Congress by defining the term “navigable
waters” in Section 502(7) of the Federal Water
Pollution Control Act Amendments of 1972, 86
Stat. 816, 33 U.S.C. §1251, et seq. (the “Water
Act”) to mean “the waters of the United States,
including the territorial seas,” asserted federal
jurisdiction over the nation’s waters to the
maximum extent permissible under the
Commerce Clause of the Constitution.
Accordingly, as used in The Water Act, the
term is not limited to the traditional tests of
navigability.
The court ordered the Secretary of the Army
(Secretary Callaway) and the Chief of the Army Corps
of Engineers (General Gribble) to revoke and rescind
A-16
the definition set forth in the regulations published in
39 Fed. Reg. 12115, et seq., on April 3, 1974. The court
further ordered publication of proposed regulations
within 15 days and final regulations within 30 days of
March 27, 1975 “clearly recognizing the full regulatory
mandate of the Water Act.” Pursuant to the order of
the court (no appeal having been taken), the Corps
published for comment four alternative proposed
regulations in 40 Fed. Reg 19766, et se., on May 6,
1975. Interim final regulations were published in 40
Fed. Reg. 31320 on July 25, 1975 as Sections 209.120, et
seq. of 33 C.F.R., and comments thereon were invited
during the succeeding 90 days.
The Corps, ſblecause of the intense public interest
in those applications,” had already called a public meeting
in Naples, Florida, on February 25, 1975, “to explain
the reasons for the delays in processing the applications
and the future steps to be taken in bringing them to a
conclusion.” Approximately 1,200 people attended the
meeting. Following the presentation by the District
Engineer, 32 people spoke in favor of issuing the permits
and 8 in opposition. In addition, 10 trade unions were
represented and spoke in favor of issuing the permits.
In the meantime, a draft EIS was prepared in
connection with the Deltona applications and, upon
completion, another public notice was issued on April
25, 1975.“ Comments were received from Federal and
This date, it will be noted, was one month after Judge Robinson's
declaration in Natural Resources Defense Council, Inc., et al u
Callaway, et al, 392 F. Supp. 685 (D.D.C. 1975), and just 10 days
before publication of the proposed broadened regulations by the
Corps.
A-17
state agencies, as well as letters and petitions or
resolutions from interested persons and organizations.
There were 541 letters received in favor of granting
the permits and 2,750 letters in opposition. On the
other hand, there were six petitions or resolutions
carrying 11,900 signatures favoring issuance, but only
1,217 signatures on 31 petitions or resolutions opposing
issuance. Most of the letters written in opposition resulted
from the activity of the Audubon Society.
There were 42 written requests for a public hearing
on the applications in accordance with the provisions of
the FWPCA 1972 amendments. The Corps completed
and made available to the public a proposed final EIS
on August 15, 1975, and held another public hearing in
Naples on September 2 and 3, 1975. Approximately
1,300 people attended that hearing. Of the 87 people
who spoke, 44 were in favor of issuing the permits and
43 were opposed.”
Having complied with all requirements of the statutes
and regulations, the District Engineer (Col. Wisdom)
submitted a report to the Division Engineer, South
Atlantic Division (Col. Hall, Acting Division Engineer)
on October 16, 1975, recommending that the District
Engineer be authorized to issue the Collier Bay permit
and to deny the Barfield Bay and Big Key permits.
By Ist Indorsement dated November 12, 1975, the
Acting Division Engineer forwarded the report of the
District Engineer to the Office of the Chief of Engineers
“The numbers are not significant if, for example, each side
was given an opportunity to speak in turn.
A-18
in Washington, D.C., with his recommendation that all
three permits be issued.“
Apparently, the recommendation of the Acting
Division Engineer never reached the Chief of Engineers
(or the Secretary of the Army). It was addressed to
“HQDA (DAEN-CWZ-A) WASH DC 20314.” By 2nd
Indorsement dated December 12, 1975, the file was
returned to the Division Engineer, South Atlantic Division,
by someone (the signature being illegible) who signed
“for KENNETH E. MCINTYRE, Brigadier General,
USA, Deputy Director of Civil Works.” Directions were
given to the Division Engineer, South Atlantic Division,
to make extensive additions and revisions to the District
Engineer’s report in an obvious effort to make the
strongest possible case to support denial of all three
applications, yet allowing for the possibility of issuance
of the Collier Bay permit and denial of the Barfield Bay
and Big Key permits as an alternative.
The instructions given in the name of the Deputy
Director of Civil Works were handed down to the District
Engineer by Col. Hall (who by that time had become
Deputy Division Engineer) by 3rd Indorsement dated
December 24, 1975. In all material respects the Deputy
Division Engineer concurred in the instructions handed
down from the Deputy Director of Civil Works. The
final paragraph of the indorsement made it clear, however,
that after the District Engineer revised his report, the
“decision document and EIS” would be submitted to
the Office of the Chief of Engineers (OCE) for approval.
A tentative date of January 21, 1976 was set for a
"A discussion of the reasons for the recommendation is set
forth in the 1st Indorsement.
A-19
meeting with OCE“ to discuss the decision document
and EIS “in final draft form.”
The District Engineer (Col. Wisdom), by 4th
Indorsement dated January 15, 1976, submitted the
revised documents to the Division Engineer. In that
indorsement Col. Wisdom made reference to meetings
held on January 7, 1976, with South Atlantic Division
(SAD) personnel in Jacksonville, and on January 13,
1976, with SAD and OCE personnel, stating that the
4th Indorsement was in response to those discussions,
as well as the 2nd and 3rd Indorsements. He acknowledged
that the type of community planned by Deltona “requires
direct water access to fulfill its basic purpose.” He
went on to say that “The importance to the public of
‘waterfront’ as opposed to ‘inland’ homesites in Florida
can be demonstrated by a comparison of land prices
which are in the range of $13,500 to $21,500 for waterfront
lots on Marco Island, as compared to about $5,500 for
an otherwise comparable lot situated in an inland
subdivision of Collier County.” Nevertheless, Col. Wisdom
adhered to his original position regarding approval of
only one of the three applications, stating that
“development of Barfield Bay and Big Key as proposed
will cause ‘a permanent unacceptable disruption to the
beneficial water quality uses of the affected aquatic
ecosystem.’ Completion of Collier Bay on the other
hand will cause a permanent disruption but not of an
‘unacceptable’ magnitude.”
The District Engineer concluded his recommendation
by saying that, after considering all additional data,
including “two recent Deltona letters,” he would not
change his recommendation that the Collier Bay permit
be issued and the Barfield Bay and Big Key permits be
denied.
A-20
The Division Engineer (Maj. Gen. LeTellier), on
the same augmented record and applying the same
Section 404(b) guidelines, laid out four alternatives in a
5th Indorsement dated January 19, 1976 to the Chief of
Engineers (HQDA (DAEN-CWZ-A), WASH DC 20314).
The first alternative would be to deny all three
applications, whereby alteration or destruction of 2,200
acres of mangroves (0.5 percent of south Florida’s total)
would be avoided. This would, however, raise the question
of restoration of mangroves in the upland areas of the
Collier Bay area where work had already been completed.
The second alternative would be to approve the
work already completed (since it was above mean high
water and therefore did not require a permit at the
time it was done), in which case there would be no
further “destruction of wetlands or terrestrial habitat.”
The third alternative would be to issue a permit
for Collier Bay only. This would allow completion of the
third of the five planned areas of the Marco Island
community with removal from the estuary of only 113
acres of mangroves, 1,131 acres of terrestrial habitat,
and 246 acres of bay bottom.
The fourth alternative was to issue all three permits.
This would allow completion of all five Marco Island
community areas as contemplated in the master plan
and would remove from the estuary 2,200 acres of
mangroves (0.5 percent of south Florida’s total), 3,400
acres of terrestrial habitat, and 735 acres of bay bottom.
Gen. LeTellier took the position that refusal by
the Corps to issue the Collier Bay permit could be
construed as “such a substantial and unwarranted taking
A-21
of property rights as to be a condemnation of this
property because of the extenuating circumstances
described above.” He further elaborated on that position
by stating that denial of the Collier Bay permit “could”
be held to constitute a substantial taking of property
rights (inverse condemnation) without the requisite
benefit to the environment, which is the justification
for the statute that authorized the regulation of property
rights for the public health, safety, and welfare.”
The indorsement acknowledged that at all times
the Federal Government, through the Corps, was aware
of all the work Deltona was doing and planned to do in
accordance with the master plan and work schedules
submitted to the Corps. Gen. LeTellier repeated in
paragraph 11 of the indorsement that denial of the
three permits “would impose a great hardship on the
applicant and constitute a substantial taking of property
rights. This could constitute a case of inverse
condemnation if the permits for these areas are denied.”
Gen. LeTellier recognized that it was Corps policy
to issue permits after receiving favorable state
determination “unless there are overriding National
factors of the public interest.” He characterized the
key public interest item to be the wetlands, not navigation.
Even the water quality certification established that
pollution was not a factor. Weighing the ecological,
social, and economic factors, he concluded that granting
the permits would provide social and economic stimuli
to the local area, but would impact adversely on the
existing local marine ecology. Conversely, denial of the
permits would not only eliminate the adverse ecological
impact but also would eliminate the economic (and
social) stimuli. He made a finding that there was “no
A-22
overriding National interest reason not to issue the
permits.”
The Division Engineer (whose jurisdiction is more
regional than local in scope) rejected the District
Engineer's “domino theory” that granting of the three
permits would establish a precedent whereby all future
applications would be granted. He took the position
that each application must be considered on its own
merits. He felt that it could be “a dangerous and
indefensible act to turn down or approve a permit on
the basis of its effect on other propositions not currently
at issue.”
Finally, Gen. LeTellier recommended to the Chief
of Engineers that all three permits be issued.
The Chief of Engineers (Lt. Gen. W.C. Gribble,
Jr.), by 6th Indorsement dated April 15, 1976, however,
agreed with the recommendation of the District Engineer,
rejected the recommendation of the Division Engineer,
and authorized the District Engineer only to issue the
Collier Bay permit and deny the Barfield Bay and Big
Key applications. In certification of a “Statement of
Findings,” Gen. Gribble (under date of April 15, 1976)
did not agree that “a strict interpretation of our wetland
policy and the 404(b) guidelines dictate a denial of all
three [applications]’ but made a finding that there are
“overriding national factors of the public interest which
dictate denial of Barfield Bay and Big Key”’
notwithstanding the unequivocal approval of all three
areas by the State of Florida from its Governor on
down to the lowest local level.
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Gen. Gribble made it clear in the 6th Indorsement
that the “overriding national factors of the public interest”
which he considered were based solely on the Corps’
wetlands policy. He recognized that application of that
policy would be in direct conflict with the desire of the
property owners to develop the areas for housing. In
this respect the Corps denied the permits on the basis
of the use to which the property was to be put rather
than the removal or diziturbance of the mangroves and
aquatic life in the areas. Gen. Gribble recognized, but
gave no heed to the warning signal given by his
subordinate, Gen. LeTellier, that denial of less than all
three permits might constitute a taking. Gen. Gribble
chose to deny the Barfield Bay and Big Key applications
in the face of the warning and thereby took the
responsibility for the consequences, whatever they might
be.
The 6th Indorsement authored by Gen. Gribble
under his authority as Chief of Engineers (speaking
also by authority of the Secretary of the Army) makes
it clear that changes in the Corps’ policies and decision-
making were compelled by intensification of the
environmental concerns of the Congress, the Corps
and other Federal agencies and a significant segment
of the public” within the 10 years preceding 1976. It is
also clear from the record that Judge Robinson's order
caused a signiiicant change in the Corps’ policies and
actions. In other words, the changes came about after
Deltona had made an investment-backed commitment
beginning in 1964-65 to develop all five areas of the
Marco Island community. Deltona was stopped only
after most of the lots in the area were sold to members
of the public in reliance on commitments of the State of
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Florida and the Federal Government, and after the
entire community was about half completed.
The issue before the Secretary of the Army, speaking
through his Chief of Engineers, clearly was to determine
the extent to which he could, by regulation and
administrative action, control the use of Deltona’s property
without compensating Deltona in an effort to carry out
the mandate of Congress “to restore and maintain the
chemical, physical, and biological integrity of the Nation's
waters” within the full extent of the powers of Congress
under the commerce clause of the Constitution of the
United States. He opted for issuance of the Collier Bay
permit and denial of the application for the Barfield
Bay and Big Key permits. The decision was not made
on the basis of “overriding national factors,” but solely
on the basis of the “current policies on conservation of
our coastal wetlands.”
The net effect of the denial of the Barfield Bay and
Big Key applications for permits was the same as if
Congress had set aside the areas as national parks or
preservation areas without providing for due process
and compensation of the property owners for the property
affected by the congressional action.
VI. The Mangrove Ecology
Inasmuch as the mangrove ecology in the vicinity
of the Deltona property is substantially the same as
that in the vicinity of the Jentgen property, the discussion
thereof in the Jentgen case, reported on even date
herewith, is incorporated herein by reference and will
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not be repeated. Both properties are in what is commonly
referred to as the Florida Everglades and both properties
are in proximity to the Everglades National Park and
the National Big Cypress Preserve. Furthermore, much
of the testimony and documentary evidence received
in the Jentgen case was repeated or duplicated in the
present case. A substantial amount of the evidence on
the mangrove ecology was also included in the
administrative record of the Deltona permit application
proceedings and is included in the record of the present
case. Accordingly, findings in the present case are based
on the record made herein even though they may not
be discussed specifically in this section of the cpinion.
VII. Contentions of the Parties
A. Deltona's Position
Deltona asserts that by denial of dredge and fill
permits under §404(b) of the FWP CA (33 U.S.C. 51344),
by the Corps of Engineers, the Federal Government
has deprived Deltona of its lawful right to make the
highest and best use of its property.
Deltona seeks just compensation for what it considers
to be a taking of its property by inverse condemnation”
by the United States Government. More specifically,
Deltona asserts that it has the right under Florida law
and its Settlement Agreement with the State of Florida
to dredge and fill in all areas approved by the State of
The Supreme Court of the United States has recently defined
the term “inverse condemnation” as “a shorthand description of
the manner in which a landowner recovers just compensation for
a taking of his property when condemnation proceedings have not
been instituted.” United States v. Clarke, 445 U.S. 253 (1980).
A-26
Florida through its state and local agencies, both above
and below mean high water, except where such dredging
or filling would interfere with marine navigation and
thereby be subject to the conventional Federal navigation
servitude.
Deltona likens its right to dredge and fill its property
to the right of the owner of mineral rights to mine coal,
whereby the owner may make the highest and best use
of his property, as exemplified in Pennsylvania Coal
Co. v. Mahon, 260 U.S. 393 (1922). It contends further
that, the right to dredge and fill having been taken
away by denial of its application under Section 404(b)
of the FWPCA, it is entitled to just compensation
under the fifth amendment to the Constitution for the
loss caused by the taking, under the rationale of Benenson
v. United States, 212 Ct. Cl. 375, 548 F.2d 939 (1977) and
Drakes Bay Land Co. v. United States, 191 Ct. Cl. 389,
424 F.2d 574 (1970).
Deltona points out that it made reasonable
investment-backed commitments to develop its land as
early as 1964 (prior to enactment of the FWPCA
Amendments of 1972 and more than 10 years prior to
promulgation of expanded guidelines and regulations
thereunder by the Corps and EPA in 1975), and that it
has been denied the right to carry out those commitments,
to its economic detriment. In support of this contention,
Deltona relies upon the recent decision of the Supreme
Court of the United States in Kaiser Aetna v. United
States, 444 U.S. 164 (1979).
Deltona submits that since the only viable economic
use of the property is as part of its integrated, master-
planned, “finger-fill” or “canalized” community, it is
A-27
forced to leave the mangrove growth thereon in its
undisturbed, natural state for the public benefit without
just compensation.
In the case pending before this court, Deltona
seeks oniy a monetary judgment for the taking of an
ecological or preservation easement by the Federal
Government. In the case pending before the United
States District Court for the Middle District of Florida,
Deltona is seeking judicial review of the administrative
proceeding under which the dredge and fill permits
were denied. Deltona is committed, however, to forego
its claim for relief in the latter case upon receiving a
final favorable judgment in the case before this court.
Conversely, dismissal of the case in this court would
not preclude further proceedings in the district court
case. The result of a judgment favorable to Deltona in
the Court of Claims action would be preservation of
the mangroves (which is the prime concern of defendant
and amici), whereas a favorable judgment in the district
court case would result in completion of the development
(with consequent removal of much of the mangrove
growth). Denial of relief in both courts would leave
Deltona in the “Catch 22” position of holding the property
for the public benefit but without any compensation or
other relief whatever.
B. Defendant’s Position
Defendant submits that plaintiff has no “property
right” in terms of a right to dredge and fill in areas
over which the Federal Government has asserted
statutory and regulatory, as well as common law
jurisdiction. Since Deltona has no “property right,”
reasons defendant, nothing has been taken for which
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just compensation must be paid under the fifth amendment
to the Constitution.
Alternatively, defendant contends that (even if
Deltona has a “property right”) there has been no
“taking,” since Deltona has not been deprived of all
beneficia! uses of its property.
Defendant takes the position that it is unnecessary
for it to rely on the doctzine of navigation servitude
since the United States may protect its own interests
in “public waters” by prohibiting acts which are
“detrimental” to those waters even where navigation,
per se, is not affected. In support of this position defendant
points out that, in enacting the FWPCA Amendments
of 1972, Congress expanded the conventional definition
of “navigable waters” to mean “waters of the United
States,” the purpose being to give the definition “the
broadest possible constitutional interpretation
unencumbered by agency determinations which have
been made or may be made for administrative purposes.”
Defendant also calls attention to the congressional
objective of the FWPCA Amendments of 1972 “to restore
and maintain the chemical, physical, and biological
integrity of the Nation’s waters” by prohibiting pollution
of those waters as well as prohibiting interference
with navigation.
It is defendant’s position that Congress derives its
authority to regulate the “waters of the United States”
from the commerce clause of the Constitution and not
under the police power inherent in the general welfare
clause of the Constitution. In this respect defendant
relies upon the following distinction drawn by Freund
in his 1904 work entitled The Police Power:
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It may be said that the State takes property
by eminent domain because it is useful to the
public, and under the police power because it
is harmful * * *. From this results the
difference between the power, that the former
recognizes the right to compensation, while
the latter does not.
Consequently, defendant argues that denial of dredge
and fill permits is not a “taking” of a property right
(even though the area to be dredged or filled is above
mean high waiter), since the applicable legislation and
regulation is designed to secure a public benefit for
which compensation of the affected property owner is
not required.
Defendant asserts that the decision of the Supreme
Court of the United States in Penn Central Transportation
Co. v. New York, 438 U.S. 104 (1978) supports its position
that denial of a permit to alter property in a way which
adversely affects the (aesthetic) environment is not
compensable unless all value of the property has been
lost. In this respect, it necessarily follows that defendant's
position is that the taking of any property right less
than the entire fee is not compensable. Defendant suggests
that Benenson, supra, also supports that contention
inasmuch as the Court held in that case that: “Unlike
the facts in the cases cited by the defendant, plaintiffs
have no beneficial or reasonable use of the property
left to them.“
Defendant failed to call attention to the following sentence
which appears after the sentence quoted above: “They are, in fact,
forced by the PADC denial to maintain the Willard for the benefit
of the populace at a cost of hundreds of thousands of dollars a year
with a complete loss of profits and with no certain and foreseeable
relief.”
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It is defendant’s belief that Deltona can make use
of the portions of the property above mean high water
where there is no mangrove growth and no dredging
or filling of wetlands is required, thereby salvaging
some value for the property, as a whole. As a further
proposal, defendant suggests that other properties in
the area which are owned by Deltona might be developed
in lieu of the wetlands which were to be dredged and
filled and thus Deltona has not been deprived of all use
of all of its properties.
C. Amici’s Position
The Environmental Defense Fund, Inc., the National
Audubon Society, Inc., the Florida Audubon Society,
Inc., and the Collier County Conservancy, as amici curiae,
have filed a brief which, for the most part, parallels the
brief filed by defendant. The amici submit that Deltona
has no property right of which it has been deprived by
denial of their applications for permits and that, even if
Deltona has a property right, the denial did not deprive
Deltona of all uses of its property.
The amici contend that the legislation and regulations
under which Deltona was denied the permits rest upon
the welfare clause of the Constitution inasmuch as the
action of the Corps was “in furtherance of public health,
welfare and safety.” More particularly, they contend
that the mangroves “have significant values for water
quality, fisheries, wildlife, coastal recreation and storm
protection,” and it is those values which are protected
by the action of the Corps.
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It is the further contention of amici that the
completed approval of the Deltona development by the
State of Florida and all its agencies, and the issuance of
the Roberts Bay permit under conditions “bb” and
“ee,” did not give Deltona grounds for a reasonable
expectation that their investment-backed project would
be completed according to the master plan upon which
such approvals were based.
Both amici and defendant would have the court
regard any prospective representations by Government
officials as ultra vires or even illegal. It is their contention
that a specific application must be filed for each area to
which the master plan applies even though it was not
practical for Deltona to file applications for all five
areas at once in 1964-65. (By hindsight, it might have
behooved Deltona to have done so in light of the earlier
approval of the Marco River and Roberts Bay permits.)
Amici also submit that Federal jurisdiction extends
to activities in areas above mean high water “where
such activities will alter significantly the ecological
condition of the navigable waters and will therewith
cause a public nuisance.”
Finally, amici have attempted to inject consideration
of the Flood Disaster Prevention Act of 1973, 42 U.S.C.
§4001 into the case. In support thereof they seek
consideration of very recently issued maps to support
a contention that the Deltona property could not now
be used as residential property under current Federal
and county regulations. Since the taking, if any, occurred
in 1976, any regulations promulgated after that date
are irrelevant and inadmissible in evidence. Moreover,
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amici may not submit evidentiary matter in this case,
their motion for leave to intervene having been denied.
VIII. Discussion
Defendant and amici“ challenge Deltona’s right to
even maintain the present action on the ground that
Deltona has no common law or inchoate right to dredge
or fill either in navigable waters or wetlands (as defined
by Federal statute and regulations). It is argued further
that Deltona does not have a right to receive a permit
to dredge and fill since the sovereign has the sole
power to regulate private use of (and in effect, owns)
not only the navigable waters but also “wetlands” ( e.,
adjacent areas which support vegetation which requires
saturated soil for growth).
It is clear from the established precedents that
there can be no private ownership of the navigable
waters. Neither are they owned by the sovereign. They
are in the public domain and the public has an easement
in perpetuity to use those waters. The sovereign, however,
is responsible for control of the navigable waters to the
extent necessary to keep them safe and unobstructed
for public use. The common law power to control
navigation in the respective states was originally held
by the states and the people, but was surrendered by
them to the Federal sovereign under the commerce
clause of the Constitution of the United States. Inasmuch
as the power to regulate the navigable waters is in
derogation of the common law rights of the states and
“Brief amicus curiae filed by Environmental Defense Fund,
Inc., National Audubon Society, Inc., Florida Audubon Society,
Inc., and The Collier County Conservancy.
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the people, such right is to be narrowly construed to
extend geographically only to mean high water.
A. Constitutional Basis for Statutes in Issue
Section 10 of the River and Harbor Act of 1899, 30
Stat. 1151 (codified in 33 U.S.C. §403), finds its
constitutional basis in the commerce clause of the
Constitution of the United States (Article I, Section 8,
Clause 3). This section (and Section 9 of the same act)
superseded the Act of September 19, 1890, c. 907, §7,
27 Stat. 8, 110), and has remained unchanged in substance
up to the present. At the time of the enactment of the
River and Harbor Act of 1899 it was well established
that Congress had the power to control“ * * * all the
navigable waters of the United States which are accessible
from a State other than those in which they lie.” Gilman
v. Philadelphia, 3 Wall. 713, 724-725. This necessarily
included the power to * keep them open and
free from any obstruction to their navigation * * *;
and to provide, by such sanctions as they may deem
proper, against the occurrence of the evil and for the
punishment of offenders.” Jbid. 725. This power is also
extended to all riparian owners since their properties
are subject to the power which existed in the states
before the adoption of the Constitution (and always
existed in the Parliament in England) to subject such
properties to a common law navigation servitude.
By judicial interpretation in The “Daniel Ball” u
United States, 10 Wall. 557 (1871), the Supreme Court
interpreted the power to control navigation to include
navigation upon wholly intrastate waters by a vessel
carrying cargo which was en route to or from a point
outside the state in which the waters were located.
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Thus the scope of authority of Congress to control
navigation was expanded beyond the mere control of
the waters and the vessels plying those waters to
include activities which took place upon those waters
where such activities involved interstate transportation
of goods.
The only respect in which the Deltona property
affects or is affected by interstate commerce is in the
sale of lots or residences to out-of-state purchasers.
Obviously, the sale of property under these circumstances
would be subject to the Interstate Land Sales Disclosure
Act, P.L. 90-448, Title XIV, §1402, et seg., Aug. 1, 1968,
82 Stat. 590; 15 U.S.C. §§1701, et seq., and therefore is
commerce within the meaning of Article I, Section 8,
Clause 3 of the Constitution. That statute, however, is
not the basis for denial of the dredge and fill permits in
this case.
The common law term “navigable waters,”
accordingly, is not synonymous with the term “navigable
waters of the United States” as used by the courts in
interpreting the Federal statutes. The latter term gained
currency in 1975 as a result of the expanded definition
thereof appearing in the regulations promulgated by
the Department of the Army (33 CFR 209.120) for the
purpose of implementing Section 404 of the Federal
Water Pollution Control Act of 1972 (33 U.S.C. §1344).
In the regulations “navigable waters of the United
States” is “administratively” defined to mean “waters
that have been used in the past, are now used, or are
susceptible to use as a means to transport interstate
commerce landward to their ordinary high water mark
and up to the head of navigation as determined by the
Chief of Engineers, and also waters that are subject to
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the ebb and flow of tide shoreward to their mean high
water mark (mean higher high water mark on the Pacific
Coast).” (Emphasis supplied.)
The original term “navigable waters” has been
administratively defined for the purposes of Section
404 of the FWPCA as including not only those waters
embraced within the definition of “navigable waters of
the United States,” but also “all coastal wetlands, mudflats,
swamps, and similar areas that are contiguous or adjacent
to other navigable waters.” “Coastal wetlands” are
further defined by regulation to include “marshes and
shallows” and “those areas periodically inundated by
saline or brackish waters and that are normally
characterized by the prevalence of salt or brackish
water vegetation capable of growth and reproduction.”
The definition is not limited to the foregoing but
also includes “freshwater wetlands, including marshes,
shallows, swamps, and similar areas that are contiguous
or adjacent to other navigable waters and that support
fresh water vegetation.” The definition goes on to state
that “freshwater wetlands” means “those areas that
are periodically inundated and that are normally
characterized by the prevalence of vegetation that
requires saturated soil conditions for growth and
reproduction.”
It is obvious that the administratively promulgated
definition of “navigable waters” goes far beyond the
conventional understanding of that term (as of the date
of promulgation), since the definition does not relate to
navigability of the waters but is expressed solely in
terms of the ability of the land, whether inundated or
moistened by saline or fresh water, to support vegetation.
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The conventional limits of the navigation servitude
comprehended both by Section 10 of the River and
Harbor Act pf 1899 and Section 13 of the Refuse Act of
1899 are exceeded by the foregoing definition of “navigable
waters” and “navigable waters of the United States”
since the navigation servitude contemplated in 1899
was conventionally understood (prior to promulgation
o* the 1975 administrative definition) to extend only to
the mean high water level of navigable waters (whether
interstate or intrastate, if used for commerce) up to the
headwaters thereof.
This is not to say that either the Congress or the
Department of the Army has exceeded its constitutional
power in regulating the use of land which will support
vegetation which requires saturated conditions, if (and
only if) there is a nexus between such use and interstate
commerce. In such event, however, compensation is
required, even though normal due process (ie., a formal
declaration of taking) has not been employed before
implementing the regulation.
B. Legislative Intent
Pursuant to its constitutionally delegated authority
to regulate the navigable waters, Congress enacted
Section 10 of the River and Harbor Act of March 3,
1899, c. 425, §10, 30 Stat. 1151 (codified in 33 U.S.C.
§403)" to prohibit the creation of any obstruction to the
8403. Obstruction of navigable waters generally; wharves;
piers, etc.; excavations and filling in. The creation of any obstruction
not affirmatively authorized by Congress, to the navigable capacity
of any of the waters of the United States is prohibited; and it shall
not be lawful to build or commence the building of any wharf, pier,
dolphin, boom, weir, breakwater, bulkhead, jetty, or other structures
A-37
navigable capacity of any of the “waters of the United
States” except as authorized by Congress on plans
recommended by the Chief of Engineers and approved
by the Secretary of the Army.
At the same time Congress enacted Section 13 of
the Refuse Act of March 3, 1899, ch. 425, §13, 30 Stat.
1152 (codified in 33 U.S.C. §407)."° This act made it
unlawful to discharge “any refuse matter” into any
(Footnote 15 Continued)
in any port, roadstead, haven, harbor, canal, navigable river, or
other water of the United States, outside established harbor lines,
or where no harbor lines have been established, except on plans
recommended by the Chief of Engineers and authorized by the
Secretary of the Army; and it shall not be lawful to excavate or
fill, or in any manner to alter or modify the course, location,
condition, or capacity of, any port, roadstead, haven, harbor, canal,
lake, harbor of refuge, or inclosure within the limits of any breakwater,
or of the channel of any navigable water of the United States,
unless the work has been recommended by the Chief of Engineers
and authorized by the Secretary of the Army prior to beginning
the same.”
98407. Deposit of refuse in navigable waters generally. It
shall not be lawful to throw, discharge, or deposit, or cause, suffer,
or procure to be thrown, discharged, or deposited either from or
out of any ship, barge, or other floating craft of any kind, or from
the shore, wharf, manufacturing establishment, or mill of any
kind, any refuse matter of any kind or description whatever other
than that flowing from streets and sewers and passing therefrom
in a liquid state, into any navigable water of the United States, or
into any tributary of any navigable water from which the same
shall float or be washed into such navigable water; and it shall not
be lawful to deposit, or cause, suffer, or procure to be deposited
material of any kind in any place on the bank of any navigable
water, or on the bank of any tributary of any navigable water,
where the same shall be liable to be washed into such navigable
A-38
“navigable water of the United States, or into any
tributary of any navigable water from which the same
shall float or be washed into such navigable water; * * *
whereby navigation shall or may be impeded or
obstructed * * *.” The Act provided, however, that
when, in the judgment of the Chief of Engineers
“anchorage and navigation will not be injured thereby,”
the Secretary of the Army could permit the deposit of
such matter within limits prescribed by him. This act
was the foundation for the FWPCA Amendments of
1972." Prior to 1970, the principal involvement of the
EPA with the Corps of Engineers was with respect to
dredge and fill permits under Section 10 of the River
and Harbor Act of 1899 (33 U.S.C. §403). However, on
(Footnote 16 Continued)
water, either by ordinary or high tides, or by storms or floods, or
otherwise, whereby navigation shall or may be impeded or obstructed:
Provided, That nothing herein contained shall extend to, apply to,
or prohibit the operations in connection with the improvement of
navigable waters or construction of public works, considered
necessary and proper by the United States officers supervising
such improvement or public work: And provided further, That the
Secretary of the Army, whenever in the judgment of the Chief of
Engineers anchorage and navigation will not be injured thereby,
may permit the deposit of any material above mentioned in navigable
waters, within limits to be defined and under conditions to be
prescribed by him, provided application is made to him prior to
depositing such material; and whenever any permit is so granted
the conditions thereof shall be strictly complied with, and any
violation thereof shall be unlawful.”
"Hearings Before the Subcommittee on Air and Water Pollution
of the U.S. Senate Committee on Public Works, 92nd Cong. Ist
Sess., Feb. 4, 8 and 9, 1971 (Serial 92-H1), pp. 2 (Ist par.); 10
(ante-penultimate par.); 22-25 (colloquy between Senator Eagleton
and EPA Administration Ruckelshaus); pp. 25-26 (colloquy between
Senator Randolph and EPA Administrator Ruclelshaus).
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December 23, 1970, under Executive Order 11574,
President Nixon invoked Section 13 of The Refuse Act
of 1899 (33 U.S.C. §407) to initiate a permit program
under which the Corps of Engineers and EPA were to
cooperate with respect to the effect of refuse disposal
on water quality of the navigable waters of the United
States. 35 Fed. Reg. 19627 (1970). Throughout the
hearings it was recognized that the principal responsibility
for control of water quality rested with the states and
that the only way the Federal Government could inject
itself into the matter was through the power of Congress
to regulate commerce.
Whereas Section 10 of the River and Harbor Act
of 1899 prohibited direct obstruction of navigation,
Section 13 of The Refuse Act of 1899 was intended to
prevent the discharge or dumping of refuse into the
navigable waters of the United States “whereby
navigation shall or may be impeded or obstructed.” In
both sections permits could be issued by the Corps of
Engineers to allow exceptions to the prohibited acts
where the issuance of such permits would not adversely
affect navigation. Nowhere in either section is reference
made to the maintenance of any standard of water
quality necessary to support aquatic life. It might be
argued that Section 13, in particular, contemplates control
of discharge of toxic or noxious effluents into Federal
waters but nowhere is there found any basis for requiring
a property owner to maintain or refrain from removing
a beneficial source of effluent, such as the detritus
from mangrove trees.
See also, a memorandum submitted to the Senate subcommittee
by David D. Dominick, Acting Commissioner, EPA Water Quality
Office appearing at pp. 35-36 of the Hearings, supra.
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The legislative history of the FWPCA Amendments
sheds much light on the efforts of the EPA and Congress
to bootstrap the power of Congress to regulate the
local environment. During the 1971 hearings, Senator
Eagleton put the question to EPA Administrator
Ruckelshaus this way:
SENATOR EAGLETON. Now, my final area
of inquiry on this subject matter concerns the
interrelationship between this 1899 Refuse Act,
the one we passed in 1970, and also the Fish
and Wildlife Coordination Act passed in the
1950’s and the National Environmental Policy
Act which was passed in 1969.
When the crops [sic] after consulting with
you decides whether to issue the permit, does
it consider only—and do you then consider
only — questions of navigation and water quality,
or are there other criteria that you likewise
consider such as the public interest, fish and
wildlife, et cetera, et cetera?
Administrator Ruckelshaus and Senator Eagleton
continued the colloquy as follows:
MR. RUCKELSHAUS. Senator, that is a
question not without some complexity.
Let me try and make our position as clear
as possible.
We think that the authority on which the
Environmental Protection Agency has a right
to review water quality standards as relating
A-41
to these permits is much stronger given the
Refuse Act and the Water Quality Act, section
21. We believe that by taking into account the
whole question of water quality and related
considerations we thereby take into account
public interest as it relates to this question.
Now, the Fish and Wildlife Act of title XVI,
section 662, gives them the power to consider
fish and wildlife consideration. Again, under
our reading of that —
SENATOR EAGLETON. Gives who?
MR. RUCKELSHAUS: The Fish and Wildlife
Bureau of the Interior Department.
SENATOR EAGLETON: Is that under EPA?
MR. RUCKELSHAUS: No; that is still under
the Interior Department. Only as it relates to
dredge and fill operations or navigational
concerns.
What we have attempted to do in our
memorandum of understanding with the Corps
of Engineers is to spell out the kinds of
considerations that the Environmental
Protection Agency will take into account in
recommending to the Corps of Engineers that
they issue or not issue a permit, and in our
memorandum of understanding and No. 1, under
policies, this statement is contained:
“The Corps shall accept such advice”
that is, our advice relating to whether
A-42
they should issue the permit —“on matters
pertaining to water quality standards and
related water quality considerations as
conclusive and no permit shall be issued
which is inconsistent with any findings,
determination, or interpretation of a
regional representative with respect to
such standards or consideration.”
Now, we believe that under this provision if
in any outfall or any effluents there are in
addition to water quality standards
considerations which relate to fish and wildlife,
that the Environmental Protection Agency can
take those considerations into account at the
same time we are consulting with the Interior
Department and the Fish and Wiidlife Bureau
of that Department in recommending to the
Corps of Engineers as to whether they should
grant a permit.
We are committed to consult with the Fish
and Wildlife Bureau of the Interior Deprtment
in any instance where it appears that the
discharge will have some effect on fish and
wildlife and take into account their
recommendations to us in finally recommending
to the corps whether a permit should be issued.
SENATOR EAGLETON: I am glad to hear
that because it has been alleged that the permit
program that you are enbarking upon with
these 40,000 sources might be so narrowly
gaged as to restrict itself simply to navigation
and to a narrow definition of water quality
A-43
and not take into account other broader questions
of “public interest.”
I take from the thrust of your statement
and your reference to your memorandum of
understanding that related water quality
considerations will broaden the scope of your
approval process to go beyond just navigation
and water quality.
MR. RUCKELSHAUS: This is right,
Senator.
We believe this permit program is related
to the maintenance of water quality in the
broad sense and that the public interest involved
with the permit program is to preserve water
quality, again in the broad sense. So, we think
that by adopting this mechanism we are on
much stronger and firmer legal grounds in
interpreting our power under the statute than
we would be if we adopted a much broader
definition of “public interest.”
SENATOR EAGLETON: Now, thus far my
questions insofar as the Refuse Act is concerned,
I guess, have been gaged in and zeroed in on
section 13 of the act.
What about section 10 of the act, the 1899
act, which deals with other discharges or other
matters that might be in the nature of
obstructions which could include, for instance,
pipe protruding out into the river?
A-44
Do you plan to issue, or have you issued,
regulations pursuant to that section and what
is the scope of those insofar as criteria are
concerned? Is it just water quality or is it a
broader criteria, as well?
MR. RUCKELSHAUS: Mr. Quarles can
answer that question.
MR. QUARLES: Senator, it is confusing
because in a number of situations that come
rapidly to mind, a permit would be required
under the provisions of section 10 and it would
also be true if you read the provisions in section
13 that a permit would be required under that
section.
Section 10 really is a more familiar section
and better flushed out as to its details and its
manner of application because that has been
applied for a considerable number of years
and there are very well established procedures
that are applied by the Corps of Engineers in
granting permits under that section for the
so-called dredge-and-fill projects.
Their procedures do encompass a review of
the proposed findings by the Interior
Department under a memorandum of
understanding signed by Secretary Resor and
then Secretary Udall in 1967.
One of the agencies which customarily
reviewed those proposals under that
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understanding was the Federal Water Quality
Administration.
So, although the formal arrangements have
not been confirmed in a written agreement
yet, it is anticipated and, indeed, it is in effect
that these projects are reviewed by EPA
personnel for water quality considertions. They
are also reviewed by the Interior Department
personnel for a variety of considerations
including fish and wildlife and recreation and
other considerations.
They also presumably now are or will be
reviewed by the personnel in the NATO
Oceanographic and Atmospheric Administration.
SENATOR EAGLETON: So, regulations
will be forthcoming for the implementation of
section 10, and I take it that the criteria for
the issuance of a permit under section 10 will
include more than just water quality and
navigation; since it is going to Interior, it will
include considerations for fish and wildlife and
so-called public interest.
MR. QUARLES: I doubt that regulations
will be issued. I think there will probably be a
memorandum of understanding that would cover
our review of those findings.
I should mention also, Senator, that the
regulations already issued as proposed
regulations by the Army under this proposal
specifically point out that in cases where both
A-46
permits are required, both permits must be
applied for and obtained unless special
arrangements are made for a single permit to
cover both features, but it is great deal simpler
and easier to keep these things understandable,
to keep them separate in your mind and
recognize that each have separate requirements
which will have to be complied with.
SENATOR EAGLETON: Just one final
question before yielding to Senator Buckley.
Could we be of service to you in trying to
more precisely clarify in the forthcoming
legislation the interrelationships between the
various environmental pieces of legislation that
have grown up as far back of 1899, et cetera,
so that we could try to establish a very clear,
specific mode of operation?
MR. RUCKELSHAUS: I think that would
be helpful, Senator.
In the same series of hearings, EPA Administrator
Ruckelshaus, in response to questions by Senator Baker
concerning the applicability of the Refuse Act of 1899
to the permit program contemplated by EPA, took the
position that the legislation under consideration (S.
1014) would expand the jurisdiction of the Federal
Government with respect to water quality standards.
He said:
MR. RUCKELSHAUS: * * * For example,
expanding the applicability of water quality
standards from interstate to intrastate waters
A-47
would be more in keeping with the purpose of
the Refuse Act of 1899, which applied to all
navigable streams and their tributaries. Some
of the criticism that has been leveled at the
permit program relates to the fact that the
program does not apply to intrastate waters.
This criticism would be made invalid if S. 1014
is enacted and agreement is reached on its
basic thrust among everyone who has introduced
a bill in the Congress.
SENATOR BAKER: Just this final question,
Mr. Chairman, if you will bear with me for one
moment further.
Do you propose the issuance of any regulations
or statements of redefinition in connection with
your position vis-a-vis the Refuse Act at this
time?
MR. RUCKELSHAUS: There are four
documents that provide useful background
information on the permit program. One is the
regulations of the Corps of Engineers pursuant
to section 21(b) of the Federal Water Pollution
Control Act that have been published for
comment.
The second is regulations published by the
Environmental Protection Agency pursuant
to our authority under 21(b) of that act.
The third is the memorandum of
understanding between the Environmental
Protection Agency and the corps; and the fourth
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is revised guidelines of the Justice Department
for implementation of the Refuse Act of 1899.
After these had been published for comment,
there was considerable question about their
workability and about whether they would
really effectuate the program as announced.
We have met with innumerable groups who
objected to the regulations, memorandum of
understanding, and guidelines as they were
initially published.
We have attempted to take all of these
objections into account in coming up with a
final memorandum of understanding and
regulations that will be published shortly. I
am sure we will not have satisfied everybody.
Senator Baker also queried Administrator
Ruckelshaus regarding the extent to which EPA
involvement in intrastate water quality control would
lead to land use regulation by the Federal Government.
It was Senator Baker’s view that land use and
environmental quality are interrelated and that
“ * * * we are teetering on the brink of Federal land-
use policy.”
Senator Mondale (now Vice President Mondale)
expressed his concern for the environment of the Great
Lakes and other fresh water bodies in the hearings on
March 16, 1971, when he stated:
Unfortunately, we have allowed hundreds
of our freshwater lakes to become dirty, polluted,
and to be destroyed through what scientists
A-49
call eutrophication. We have dirtied our lakes
in many careless and thoughtless ways. We
have used them as convenient dumping places
for municipal, industrial, and agricultural wastes,
filling their depths with tons and tons of
phosphate-laden sludge.
Often we have not even bothered to treat
these wastes before pouring them into our
lakes. These waters have enriched the waters,
creating abnormal algae growth that have
robbed the lakes of oxygen and turned them
an unhealthy green color.
At the same time, in a wild quest for
recreation property, developers have stripped
many lakes of needed shoreline vegetation.
This has allowed the erosion of soil and debris
into the lakes, also helping to destroy their
delicate balance of marine life. Our lakes are
literally choking to death on these various
pollutants, and many of them have already
died.
We must provide families with vacation
homes and recreation, but we must begin to
treat our lakes as irreplacabie resources.
* * * * *
Up until now, we have dealt primarily with
interstate waterways, the rivers and larger
lakes across State boundaries. These thousands
and thousands of community lakes which are
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so important to their communities and to the
neighborhoods have been ignored, and I think
just the nature of the cosponsorship of this
measure indicates that action by the Federal
Government is long overdue.
The position of the National Wildlife Federation (a
national conservation organization) was made known to
the subcommittee through a statement of Louis S.
Clapper, Conservation Director of that organization
and a member of the President’s Federal Water Pollution
Control Advisory Board. That organization, like EPA,
focused its attention on the harmful effect of discharge
of effluent on the aquatic environment and encouraged
extension of Federal regulation beyond the traditional
limits applied by the Corps of Engineers in its permitting
program under the Refuse Act of 1899.
In a colloquy between Senator Baker and the late
Senator Hart of Michigan, it was brought out that the
Refuse Act of 1899 (not Section 10 of the River and
Harbor Act of 1899), by its literal terms, provided a
basis for the Corps of Engineers to regulate the discharge
of effluent into waters within its jurisdiction. Senator
Baker said, however, that “we tend from time to time,
then, to press that piece of legislation beyond the obvious
and literal language of the statute.” Senator Hart agreed
that “the drafters of the 1899 Act never anticipated
the use to which we suggest it be applied, although the
language clearly authorizes the use that we now argue
should be made. They were thinking of ship bottoms
not being torn out by rock that was dumped in and we
are thinking of mercury that may not hurt the ship but
can kill the child.”
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It is apparent from the foregoing excerpts from
the legislative history of the FWPCA Amendments of
1972 that Congress did not intend that private citizens
should be required to maintain or sustain a supply of
beneficial effluent but that discharge of harmful, toxic,
noxious or obstructive effluent should be policed and
prevented.
Use of the permitting process as a means of
preventing destruction or removal of mangrove trees,
wherever located, is land-use regulation which is outside
the purview of the statutes. Accordingly, application of
regulations which go beyond the scope of the statute
constitutes a taking where the result of such application
is the denial of the right of a property owner to make
the highest and best use of his property. Since the
ecological considerations are the sole basis for denial of
the permits in the present case, the cost of preserving
the ecology must be borne by the public at large, not
by the property owner alone.
C. Navigation Servitude
A totally different approach is taken when it comes
to regulation or control of the aquatic resources which
are not a part of the system of navigation or subject to
the Federal navigation servitude in terms of effect on
navigation, per se. Typical cases involve riparian rights
of private parties as determined by the common law,
state statutes, or local ordinances. Thus, where private
parties divert the flow of water or where Federal activity
(such as construction of dams) causes flooding of private
property, there is a cause of action for the resulting
damage.
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If, on the other hand, through intent or neglect, a
party creates a nuisance by polluting his neighbor's
property or the waters to which the neighbor has a
right, the nuisance may be abated either by private
legal action or by appropriate legislation or governmental
regulation. In such cases the civil wrong may be remedied
by applying the normal tort criteria for the trespass on
the neighbor’s property or the police power may be
invoked by governmental action. Miller v. Schoene, 276
U.S. 272 (1928).
Where, as here, the property owner is not creating
a nuisance or causing pollution of the adjacent navigable
waters, the normal riparian or tort law does not apply.
Here it is the desire of the sovereign to prevent the
owner from removing his own foliage from his own
property. The sovereign contends that such removal
would result in loss of a beneficial source of nutrition
for fish and shrimp which are expected to be caught by
private parties, de., commercial or sports fishermen. In
other words, there is an assertion of a dominant Federal
servitude upon the private property on which mangroves
are growing naturally.“ Extension of the navigation
servitude to prevent removal of beneficial vegetation
growing on private property is, therefore, just as much
a taking of the property as a prohibition against the
removal of coal from under residential properties. See
Pennsylvania Coal Co. v. Mahon, 260 U.S. 393 (1922).
This case is unlike that in which a property owner is required
to cut down a cedar tree (without compensation) because the tree
is the habitat of a type of pest which is causing damage to the
apple trees on the property of another party. (See discussion of
Miller v. Schoene, 276 U.S. 272 (1928) in 80 HARV. L. REV. 1198
(1967) ).
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It is significant to note that plaintiff has a lawful
right to sever the mangrove trees at the trunk (just
above mean high water, for example) and thereby
completely frustrate the object of defendant’s denial of
a dredge and fill permit by removing the foliage.
Defendant does not go so far as to contend that such
action could be prevented unless plaintiff polluted the
navigable waters or dredged or filled below MHW in
the process of removing the upper portion of the trunks
and the leafy growth of the mangroves. This hyperbolic
illustration serves to prove that denial of the dredge
and fill permit goes well beyond mere regulation of
that which is subject to the dominant Federal servitude
or even the police power. It constitutes a regulation of
land use comparable in all respects to the taking of the
Willard Hotel property in Benenson v. United States,
212 Ct. Cl. 375, 548 F.2d 939.
D. Property Rights Under State Law
The owner of property in the State of Florida has
the constitutional right under the Florida Constitution
(Article I, Section 9 and Article X, Section 6(a)) to
acquire, use, and dispose of it for lawful purposes.”
(Kass u Lewin, 104 S.2nd 572, 578 (Fla. 1950). Moreover,
the right of the property owner to make “economically
beneficial use” of his property is protected under Florida
Statutes 380.08(1). (See also, U.S. u General Motors
Corp., 323 U.S. 373, 378 (1945) for the proposition that
the word “property” as used in the Constitution of the
United States includes the right to use the property as
well as the right to possess and dispose of it.)
It is also clear from the decisions of the Florida
courts that property owners must be compensated for
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their losses if they are denied the right to fill land
which was former sovereignty land and where the
purpose of the denial is based on ecological benefit to
the public. (See Askew v. Gables-By-The-Sea, Inc., 333
So.2d 56 (Fla. lst DCA 1976); Zabel u Pinellas County
Water and Navigation Control Authority, 171 So.2d
376 (Fla. 1965); and Alford u Finch, 155 So.2d 790 (Fla.
1963). See also, Note, State and Local Wetlands Regulation:
The Problem of Taking Without Just Compensation, 58
U. VA. L. REV. 876, 905-906 (1972) ).
The matter of compensation for taking” by the
State of Florida where development is thwarted by
refusal of the state officials to issue a development
permit is still being litigated in Estuary Properties,
Inc. v. Askew, et al, Case No. II-419, District Court of
Appeal, First District, State of Florida. (The case is
pending on appeal before the Supreme Court of the
State of Florida, under the caption Graham, et al u
Estuary Properties, Inc., 58, 485, oral argument having
been heard on June 6, 1980.)
If the Government takes less than the fee, the
property owner's recovery is not limited to the fair
market value of the owner's interest in the unimproved
property affected by the taking, but must be based on
the highest and best use to which the property may be
put. Benenson v. United States, 212 Ct. Cl. 375, 548
F.2d 939 (1977). (See also, United States u Causby, 328
Governmental action short of acquisition of title or occupancy,
if its effect is so complete as to deprive the owner of all or most of
his interest in the subject matter, amounts to a taking. United
States v. General Motors Corp., 323 U.S. 373, 378, citing Lewis,
Eminent Domain, 3d Ed., §§63, 64.
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U.S. 256 (1946) and subsequent “avigation” easement
cases.)
When the United States of America deeded the
swamplands of Florida to the State of Florida in
consideration of the undertaking by the state or its
successors in title to develop the lands, it surrendered
title and all claim to Federal sovereignty over those
lands except such rights as the Constitution of the
United States has reserved to the Federal Government.
Thus, from the time title passed out of the hands of the
Federal Government, the owners of the title, in fee,
had the right to dredge (excavate) and fill all such
lands, subject only to such control as may be exercised
by the State of Florida and the Federal navigation
servitude (below mean high water).
Congress, by enacting the FWPCA, has sought to
extend the common law navigation servitude, not only
to private property below mean high water but also to
property above mean high water, for purposes other
than control of navigation. To the extent that Congress
invokes the commerce clause as a basis for regulating
use of property (either above or below mean high water)
for purposes other than control of navigation, it is
exercising the power of eminent domain and must
compensate the private property owner for the resultant
taking for public use.
Any restriction upon use of property already subject
to “navigation servitude” is not compensable, whereas
any restriction upon use of property adjacent property
which is not subject to such servitude will require
compensation if the restriction diminishes the value of
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the property below the value of its highest and best
use.
In determining the reach of the navigation servitude,
de facto navigability of the waters is conclusive of the
right of the sovereign to regulate those waters. Thus if
it is necessary to regulate the use of property adjacent
such navigable waters to protect the navigability of
the waters, such regulation does not require compensation
even if implementation of the regulation will result in
either diminution of the value of the property below
that of its highest and best use or complete destruction
of the value of the property. If, however, the effect of
the regulation is to tmprove the navigability of the
waters, in any respect, any diminution of the value or a
taking of the property adjacent the existing navigable
waters exceeds the regulatory power of the sovereign
and requires the exercise of its powers of eminent
domain, with due process, to effect a compensable taking
for the public benefit.
X. Summary
Under the facts of the present case, the denial of
the permits sought by Deltona, ipso facto, constituted
a de facto condemnation of the property since the result
is the same as if the Federal Government had employed
due process under its power of eminent domain and
filed a declaration of taking to preserve the mangrove
growth on Deltona’s property.
Whereas there were unfulfilled threats of
condemnation in Drakes Bay and Benenson, supra, to
preserve the respective properties, it was the denial of
Ab
permits in each case which accomplished defendant's
desired result without a formal declaration of taking.
The Drakes Bay property became, de facto, a part of
the Point Reyes National Seashore area (16 U.S.C. §459¢-1
(1964), P.L. 87-657, Sept. 13, 1962, 76 Stat. 538), and the
Willard Hotel became a part of the Pennsylvania Avenue
Development Plan. The same methodology was employed
in the present case. By denying the permits to Deltona,
defendant has, in effect, made the property an adjunct
to land it has already acquired by eminent domain,
namely the Everglades National Park and the National
Big Cypress Preserve, but without compensating Deltona.
The constitutional basis for regulation of navigable
waters by the Federal Government is well established,
supra, and need not be discussed further. The same is
true of the legislative history of the intent of Congress
to stretch the scope of its power to regulate commerce
to its fullest extent. In particular, it will be noted that
the basis for the statutes and regulations under which
EPA (through the Corps of Engineers) exercises control
over water quality is not Section 10 of the River and
Harbor Act of 1899 but, rather, is Section 13 of the
Refuse Act of 1899. In the latter act, Congress clearly
intended to prevent use of the navigable waters as
dumping grounds for noxious or harmful waste material.
It had no intention whatever to require a property
owner to refrain from removing a source of nutrients
for the aquatic life in the navigable waters or to maintain
roosting places for waterfowl or terrestrial life.
The exercise of regulatory authority by the EPA
(acting through the Corps of Engineers) in this case
amounts to a taking by inverse condemnation for which
just compensation is mandated under the fifth amendment
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to the Constitution of the United States since the value
of Deltona’s property has been so diminished as to
render it valueless for any purpose other than
conservation. Hence, Deltona must be compensated for
the taking. Pennsylvania Coal Co. v. Mahon, 260 US.
393, 413, 415 (1922).
XI. Contingent Dismissal
Inasmuch as Deltona has sought judicial review of
defendant’s denial of the permits sought by Deltona
and that action is still pending in the United States
District Court for the Middle District of Florida, there
is still a possibility that defendant may yet see fit to
issue the permits sought. In such event this case would
be rendered moot. Accordingly, defendant will be given
an opportunity to rescind its denial of the permits and
proceed to issue the permits sought by Deltona.
If, as in the copending Jentgen case, Deltona had
not sought judicial review of defendant's denial of the
permits, there would have been no opportunity for
defendant to issue the permits except upon new
applications complying with the requirements in effect
as of the date of the new applications. However, that is
not the case and defendant may avoid liability in this
case by issuing the permits on the basis of Deltona’s
applications, the denial of which is still subject to judicial
review.
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XII. Conclusion
In its order dated February 22, 1980, the court
raised four areas of factual inquiry. The first (which
appeared to be and is an undisputed fact) is whether a
substantial amount (but not all) dredging and filling
was to be done above mean high water (the normally
and conventionally designated limit of Corps of Engineers’
jurisdiction within the “navigation servitude”). The
answer to that question is clearly established in the
affirmative by the evidence now of record in the case.
The second point is whether there is a difference
between the Government’s regulatory authority under
Section 10 of the River and Harbor Act of 1899 and the
use of the common law “navigation servitude” concept
by the sovereign to deny or reduce just compensation.
The third point was that all pertinent facts should
be developed before grappling with the ultimate question
of whether defendant is free from having to compensate
Deltona for exercising the power of the sovereign over
the “navigable waters.” All facts necessary to a
determination of the ultimate question are now of record
in this case.
Fourth, and finally, the court was unclear at the
time as to (a) the extent to which, if at all, the decision
of the Corps rested on Section 404 of the Clean Water
Act (FWPCA) and (b) the extent to which, if at all, the
term “navigable waters” as used in Section 404 extends
beyond the conventional definitions and understandings
of the terms “navigable waters” and “navigation
servitude.” These inquiries are easily answered in the
present case. The Corps would have granted the permits
under Section 10 of the River and Harbor Act of 1899
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and its guidelines for control of navigation and pollution
of the navigable waters. It denied the permits in reliance
solely on Section 404 of the Clean Water Act (FWPCA)
and, in so doing, extended the term “navigable waters”
beyond the conventional definition of that term and
beyond the conventional understanding of the “navigation
servitude.”
Just as the courts, following United States u Causby
supra, have carved out an “avigation servitude” to
which certain airspace above private property may be
subject, Congress and the executive branch have carved
out an “ecological servitude” (or, more broadly, a
“preservation servitude”) to which all privately owned
water oriented property (whether interstate or intrastate)
is subject for the purpose of controlling water quality.
In the present case, the provisions of Section 10 of
the River and Harbor Act (more properly Section 13 of
the Refuse Act of 1899) and Section 404 of the Clean
Water Act (FWPCA) have been invoked to preserve
the ecology in a manner not unlike that employed by
Congress and the executive branch in carving out areas
of wilderness as national forests and wildlife sanctuaries
or in preserving buildings along Pennsylvania Avenue
(including the Willard Hotel) as historical landmarks
for the benefit of the general public. In the latter cases,
just compensation was mandated for the taking. No
less is called for in the present case in light of the facts
as applied to the settled case law.
Deltona is entitled to compensation for the taking
of its property by inverse condemnation and judgment
is entered to that effect. Determination of the amount
of recovery is reserved for further proceedings under
Rule 131(e).
A461
FINDINGS OF FACT
1. The Deltona Corporation (Deltona) is a publicly
owned New York Stock Exchange listed corporation,
organized under the laws of Delaware with its principal
place of business in Dade County, Florida.
2. Deltona’s primary business is (and has been
for nearly 30 years) the construction, development, and
sale of planned Florida communities for retired people
of moderate income and second home communities for
sale to the public.
3. In addition to Marco Island, Deltona has
developed seven other planned communities in Florida.
Prior to Marco Island, the Deltona entity built Deltona,
which is near Deland, which now has 18,000 to 20,000
people in the community. The company then developed
Spring Hill, St. Augustine Shores. and seven other
communities.
4. Deltona is controlled by the Mackle family,
whose family construction business was the predecessor
to Deltona and which was started in Jacksonville in
1908. Prior to World War II, the company built homes
in Delray, West Palm, and Miami, Florida. At the onset
of World War II, the Mackle family construction business
built homes for the Navy and then a Navy base at Key
West during World War II. Immediately after the war,
the company constructed GI houses for returning veterans
and built some 6,000 or 7,000 in Florida.
5. In 1950, for the first time, the Mackle family
started developing whole planned communities. The
first such community was at Key Biscayne, Florida; the
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second one was at Pompano Beach. Subsequent to that,
the company built mostly water-oriented, planned
communities at Port Charlotte, Port St. Lucie, and
other coastal areas.
6. Deltona was formed in 1962 by the Mackle
Brothers. In 1964, Deltona formed a joint venture called
Marco Island Development Corporation (MIDC), which
was 50 percent owned by Deltona, and 50 percent owned
by a group of investors, including Barron Collier. About 3
years after formation of the joint venture, Deltona
bought out Collier’s 50 percent interest, thereby acquiring
100 percent control, and making MIDC a wholly owned
subsidiary of Deltona.
7. In 1964, Deltona paid some $7,500,000 for a
10,000 acre parcel which included the lands at issue in
this action, and obtained a title insurance binder in the
amount of $6 million.
8. Deltona acquired title to all of the real property
at issue in Barfield Bay and Big Key from the Collier
interests in a deed dated June 9, 1964. This deed is
recorded in the official records of Collier County, Florida,
O.R. 170 at p. 169. All of these lands are located in
Township 52S, Range 26E.
9. Deltona purchased the real property at issue
in 1964, because it was a largely undeveloped area
which, because of its topography, lent itself ideally to a
“finger-fill” community for moderate income homes and
moderate low density housing, where Deltona could
dig canals and fill the land to a proper elevation. Mangrove
growth covered most of the low-lying areas of the property.
The necessity of obtaining a Corps of Engineers’ permit
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was not a factor in the decision to purchase or not
purchase the property, but Deltona knew it might need
a Corps of Engineers’ permit because they were around
water. During this period of time, however, issuance of
Corps permits to dredge and fill was commonplace,
more or less like issuance of a building permit by local
authorities. Permits to dredge and fill in such estuarine
areas were normally issued unless the work would
adversely affect navigation.
10. At the time of its acquisition of the Barfield
Bay and Big Key areas, on June 9, 1964, Deltona also
got title to all submerged lands owned by the Collier
interests in Township 52S, Range 26E. The Colliers
had acquired title to submerged lands in and around
Marco, and acquired all of the sovereignty lands owned
by the State of Florida in and around Township 528,
Range 26E, out of the 3-foot contour and below mean
high tide in some instances, and others out to the
-5-foot contour below mean high tide. This title,
subsequently transferred to Deltona, included sandbars
and shallow banks, as well as submerged lands.
11. Deltona, in planning its Marco development,
considered the obtainment of a submerged land deed
to be very advantageous in being able to design and
develop a waterfront oriented community, because Deltona
believed that excavating this submerged land ownership
would have the effect of enhancing navigation, thereby
making the entire development highly desirable.
12. Deltona’s title to the real property at issue
came out of the United States into private ownership
by three methods: direct patent from U.S. Government
into private ownership; the Swamp and Overflowed
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Lands Act of 1850, and thence out of the state into
private ownership; and by patent to the State of Florida
and then conveyed into private ownership from the
State Board of Public Instruction. The source of title
out of the U.S. Government for all the lands at issue is
depicted in plaintiff's Ex. 248, a property derivation
map.
13. Title to Swamp and Overflowed Lands Act
passed to the State of Florida from the Federal
Government in 1850. These lands were subsequently
deeded from the state into the private ownership of
Deltona’s predecessors in title by the Trustees of the
Florida Internal Improvement Trust Fund. (These lands
are shown in green on plaintiff's Ex. 248.)
14. Deltona obtained both a title opinion and title
insurance binder on the real property at issue.
15. A legal description of the lands for which
Deltona seeks just compensation and which were owned
by Deltona as of the trial date is contained in plaintiff's
Ex. 321.
16. The legal description of the land for which
Deltona seeks just compensation excludes certain areas
south of State Road 92, running north along the side of
Barfield Bay and the west side of Barfield Bay, which
constitute an “upland” area (above the 6-foot contour)
which was not part of Deltona’s permit applications to
the Corps. This exclusion was based upon an examination
of the contours on the dredge and fill permit application
map.
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17. The 6-foot contours exclude “upland” areas
immediately south of State Road 92, consisting of 91
acres and the 20 acres on the north side of State Road
92. No dredging or filling of navigable waters was
indicated in this area in the dredge and fill permit
applications that were denied by the Corps of Engineers.
18. The overall acreage of the real property at
issue in this lawsuit is approximately 2,150 acres
(approximately 111 acres of which are above the 6-foot
contour). The Big Key area comprises approximately
1,116 and Barfield Bay consists of approximately 1,034
acres. These acreage figures appear in the Corps’ 1976
Final Environmental Impact Statement, and do not
constitute calculations based on the legal description
of the lands Deltona alleges have been taken.
19. Deltona’s Marco Beach Subdivision is located
on the southwestern shore of Florida, Township 52S,
Range 26E, Collier County, and it lies at the northern
extremity of the Ten Thousand Islands chain, about 90
miles due west of Miami and some 10-15 miles south of
the city of Naples. The real property at issue is bounded
by the Gulf of Mexico on the west, Big Marco Pass on
the north, and Marco River on the northeast and east.
20. Collier County is Florida’s second largest land
mass county, including 2,006 square miles (1,283,840
acres) of land. To date, only a small portion of this
immense area has been developed. A special act has
set aside many thousands of acres bordering the
Everglades National Park as a virtually nondevelopable
“buffer zone.”
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21. The predominant land use in the Marco Island
vicinity is preservation and conservation, comprising
more than 2.9 million acres (4,500 square miles). The
major components of the preservation lands are the
Everglades National Park (2,000 square miles) and the
Big Cypress Preserve (2,450 square miles). Additionally,
Rookery Bay Sanctuary, Aquatic Preserve G-14, Collier
Seminole State Park, and that portion of lands already
ceded to the state by Deltona as part of the Caxambas
Sanctuary are dedicated to conservation and preservation
uses.
22. A substantial amount of the land in south
Florida (i e., the 12-county area within the jurisdiction
of the United States District Court for the Southern
District of Florida extending from Key West north to
Vero Beach on the Atlantic Coast and north to Naples
on the Gulf of Mexico coast) is either owned by or
under the management of the State of Florida or the
Federal Government, and practically all of south Florida's
estuarine zone (i e., the areas where the Gulf of Mexico
meets the rivers, swamps or marshes) lies within the
boundaries of the Everglades National Park. Of the
3,000,000 coastal estuarine acres in Florida outside
Everglades National Park, only 23,521 of those areas
had been filled by 1970.
23. In 1964, Detona initiated master planning for
the entire Marco Island community which, in conjunction
with subsequently recorded subdivision plat maps, deed
restrictions, zoning and other approvals, determined
and depicted use of the lands at issue.
24. Deltona’s master plan for the Marco Island
community provided for a free-standing community
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consisting of more than 12,000 single family sites,
numerous multifamily sites, school and park sites,
shopping areas, boating access and beach utilization
areas, an arterial transportation system and other planned
community facilities.
25. Marco Island proper contained in 1964
approximately 8,000 acres comprised of both upland
property (c e., property above mean high water (MHW),
and not subject to periodic tidal inundation) and property
waterward of MHW, some of which was submerged
lands. Much of the area above MHW and a much lesser
area below MHW along the shores of the uplands was
populated with dense mangrove growth. The mangrove
growth provides food and habitat for a variety of marine
and animal species indigenous to the semitropical
conditions in the area.
26. The island portion of the master planned Marco
Island community was approximately 6,800 acres, with
approximately 12,300 single family homesites, multifamily
sites for 16,000 units and commercial sites suitable to
accommodate such a population.
27. As master planned, the Marco Island community
was divided into five construction areas, namely Marco
River, Roberts Bay, Collier Bay, Barfield Bay, and Big
Key.
28. Deltona divided the land into five construction
areas because it was not feasible to build the entire
community in 3 years. It was a long-term, 15 to 20
years, project. The island was divided into parts for
construction, sales, and contracts for sale for delivery
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over a period of years. Although it was divided into
five different areas, the master-planned Marco Island
community was an integrated project.
29. Master planning for the five Marco Island
permit areas was completed in 1964-65 and included
the location of bulkhead lines, establishment of zoning
criteria, deed restrictions, platting information, and an
overall plan of development compatible with generally
accepted design criteria. The original master plan was
approved by county and state agencies. Sales commenced
in 1965, and all five permit areas were virtually sold
out (95 percent) by the end of 1970. Approximately 260
acres of the island have been designated for commercial
and business use.
30. The proposed Marco Island development is a
water recreation-oriented retirement and second home
community and resort center. It is a typical waterway
“landfinger,” or “finger-fill,” or “canalized” development
intended to offer the amenities of a planned community,
including low-to-moderate-density residential use, basic
shopping services, full utilities, and land, water, and air
access. A central feature of the project is the waterways
which provide boating access to the homesites.
31. Deltona’s concept in designing the Marco
community involved increasing the water frontage of
properties, thereby providing access to the open bays.
Deltona anticipated 40 percent of the fill material required
to develop the area would be excavated by dredging
seaward of the previously established bulkhead lines.
The remaining 60 percent of the fill would come from
landward of the previously established bulkhead line.
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32. Plaintiff's proposed development plan would
disturb some bay bottom life and habitat, as well as
substantial areas upon which mangroves grow.
33. The essence of Deltona’s development plan
was to be able to have a boat in one’s back yard and be
readily accessible to the surrounding neighborhood and
navigable water areas. The dredging in Deltona’s proposed
plan would serve the purpose of allowing navigation to
the lots around the perimeter and would also be a
source of fill for the purpose of raising low-lying lands
to a higher elevation.
34. It was Deltona’s intention, later carried out
in the earlier-developed Marco Island areas, to clear
the upland mangrove areas and to dredge and fill those
areas to establish the “finger-fill” or “canalized”.
development. Other vegetation, such as trees, lawns,
and shrubbery were to be (and have been in already
developed areas) planted in the filled areas. In order to
carry out this intention, Deltona planned to establish
navigable canals by excavating uplands and filling
lowlands with material moved from the uplands or
dredged from the bottoms of the inundated areas. This
materia! to be placed in the fill areas would raise the
elevations above flood or tidal levels so that houses
could be built thereon.
35. Deltona cannot, as a practical matter, develop
Big Key and Barfield Bay according to the plan submitted
with its dredge and fill permit without using material
dredged from the navigable waters of the United States.
It could possibly obtain all the necessary fill from upland
spoil sites, bu
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