Amicus Curiae Brief — Monterey v. Del Monte Dunes at Monterey, Ltd.

Supreme Court of the United States

October Term, 1997

¢

CITY OF MONTEREY,

Petitioner,

DEL MONTE DUNES AT MONTEREY, LTD., and

MONTEREY-DEL MONTE DUNES CORPORATION

Respondents.

7

¢

On Writ Of Certiorari

To The United States Court Of Appeals

For The Ninth Circuit

e

BRIEF OF THE INSTITUTE FOR JUSTICE AS

AMICUS CURIAE IN SUPPORT OF RESPONDENTS

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TABLE OF CONTENTS

Page

INTEREST OF AMICUS CURIAE................... |

STATEMENT OF FACTS ........cccccccvcccvceccess l

SUMMARY OF ARGUMENT ..............--+000055 4

RETIN E vv avec widccucsncdvdavenesssvasetneeeees 6

I. Section 1983 Entitles Aggrieved Landowners to A

Il.

Jury Trial on the Basic Elements of Liability in a

Regulatory Takings Claim ...............0500055

A.

The Basic Structure of Section 1983 Contem-

plates Jury Trials for Money Damages in State

Regulatory Takings Cases ...............65:

This Court Should Decide the Important Sub-

stantive Question of Constitutional Law even if

it Rules that the Trial Judge Should Resolve all

Questions of Liability in Regulatory Takings

DUORGRNS on. cece ccoceessuestutesenescesss

The “Rough Proportionality” Standard of Dolan

Clearly Applies to Government Regulations that

Deprive Landowners of All Economically Viable

Use of their Property ...........ccccvccceeseces

A. The Questions Presented Implicitly Address

Situations in which State Regulations Have

Deprived Landowners of All Economically

Viable Use of Their Property...............

The State Deprives An Owner of Vacant Land

All Beneficial Economic Use When the Total-

ity of its Permit Conditions and Restrictions

Render Unprofitable Even the Ideal Develop-

mont Program .........cccccccnscseceeesess

TABLE OF AUTHORITIES - Continued

Page

C. The City of Monterey Has Not Shown that the

Total Deprivation of Viable Economic Use is

Necessary to Prevent any Nuisance-Like

Eo avin ke hide bude ccc cad 11

D. Only Anti-Nuisance Justifications Suffice in

Cases Where Regulation Strips a Landowner of

All Economically Viable Use............... 12

E. The Dolan Rough Proportionality Standard

Governs State Justifications for Total Land Use

MEP AN Ka du ep neh Vika cUk cidbas kee chcde 14

Ill. Even in Cases of Partial Land Use Restrictions The

Rough Proportionality Standard Should be Adopted... 19

A. Rough Proportionality Reconciles the Need to Curb

the Sum of Private and Public Abuse .......... 19

B. The Need for Judicial Oversight is as Great in

Land Use Restriction Cases as it is in Exaction

SRNR Aa SSAN 2S i Ii Sa aN 23

IV. State and Local Governments Have Taken Advan-

tage of Judicial Deference to Frustrate The Reason-

able Expectations of Property Owners ........... 27

ce «SERENA ITIES GA Sei Wenn a a a 29

ili

TABLE OF AUTHORITIES

Cases

Agins v. City of Tiburon, 447 U.S. 255 TS Ea 12

Bowles v. United States, 31 Fed. Cl. 37 (1994) ..... 11, 13

City of Euclid v. Ambler, 272 U.S. 365 RS noes 15, 17

Clajon Production Corp. v. Petera, 70 F.3d 1566

A OR nD eae Ce Rise 9, II

Del Monte Dunes at Monterey, Ltd. v. C ity of Mon-

terey, 9S F.3d 1422 (9th Cir 1996)........ 1, 4, 6, 7, 26

Del Monte Dunes at Monterey, Lid. vy. City of Mon-

terey, 920 F.2d 1496 (9th Cir 1990) ........... 2, 3, 28

Dolan v. City of Tigard, $12 U.S. 374 GR passim

First English Evangelical Lutheran Church of Glen-

dale v. Los Angeles County, 482 U.S. 304 (1987) .... 28

Goldblatt v. City of Hempstead, 369 U.S. 590 (1962) ...15. 16

Landgate, Inc. v. California Coastal Commission. 17

Cal. 4th 1006, 953 P.2d 1188 (1998)............. 28, 29

Loretto v. Teleprompter Manhattan CATV Corp., 458

© EONS I ERIS Te ela eR rene 14

Lorillard v. Pons, 434 U.S. 575 (1978)................. 6

Lucas v. South Carolina Coastal Council, 505 U.S.

Sa SSE gE AE Gm ee ad passim

Nollan v. California Coastal Commission, 483 US.

Sa ena lt I i ES: 5, 9, 15, 16, 19

iv

TABLE OF AUTHORITIES — Continued

Page

Outdoor Systems v. City of Tucson, 997 F.2d 604 (9th

Gah BRED ccdcéoccnncécccendccdsadscwieebsdebiction 11

Penn Central Transportation Co. v. City of New Yc rk,

Ge es Se Gis cccucschuscabenstehtestnanscs 10

Pioneer Trust & Savings Bank v. Mount Prospect, 22

Ill. 2d 375, 176 N.E.2d 799 (1961)...............4.. 21

Pumpelly v. Green Bay Co., 80 U.S. 166 (1871) ....... 26

San Diego Gas and Electric Co. v. City of San Diego,

Gr Wes Ge CR od hd cccupebictedbadenedbacentibecs )

Schenck v. City of Hudson, 114 F.3d 590 (6th Cir.

Ss ss dancnsbdbasevecntehasanbedestatevens 12, 18, 24

Sprenger, Grubb, & Associates, Inc. v. City of Hailey,

127 Idaho 576, 903 P.2d 741 (1995)................ 18

United States v. Reynolds, 397 U.S. 14 (1970).......... 7

Williamson County Regional Planning Commission v.

Hamilton Bank of Johnson City, 473 U.S. 172

ic on dcucdcegdntdsaeetcmuaveasevsnssecieel 27, 28

Williamson v. Lee Optical of Oklahoma, 348 U.S. 483

SpEe 436 Votrsd 40400 bsnbbarder as ebnlene canoe 15

Stare StTaTuTEes

- Me Be FP Sf rer 25

Cal. Gov't Code, §§ 66410 to 66499.58 (Deering

Sk t.s chdec en dacebedistdaneSnethendkabscetiadbad 2

S.C. Code Ann. § 48-39-290(D) (Law. Co-op. 1997) .... 27

TABLE OF AUTHORITIES - Continued

Page

MisceLLaANeous PUBLICATIONS

Baldus and Cole, Statistical Proof of Discrimination

DUiols dncae cubic sued beddet Ghideadedobus és kc 20

Buchanan and Tullock, The Calculus of Consent

ictctedechutietehnensshbdbixGecaseceneheucess 22

Gilmore, The Age of Anxiety, 84 Yale L. J. 1022

Pst che taededsovsadsnadsddavenss cebuadsducdese< 28

Hayek, The Constitution of Liberty (1960) ............. 22

Hayek, The Fatal Conceit: The Errors of Socialism

Scninthigddd seats édkewdibes shin dcovedseateand 22

Hayek, The Road to Serfdom (1944)................... 22

Tribe, American Constitutional Law § 9-3 (2d ed.

PA tpthovddutmenksé ndbad dans anadsavielsesecsheced 7)

INTEREST OF AMICUS CURIAE

The Institute for Justice is a nonprofit, public interest law

center committed to defending the essential foundations of a

free society through securing greater protection for individual

liberty and restoring constitutional limits on the power of

government. Central to the mission of the Institute for Justice

is strengthening the ability of individuals to control and

transfer property and demonstrating that property rights are

inextricably connected to other civil rights.

The Institute's brief is co-authored with Professor Rich-

ard Epstein of the University of Chicago School of Law, one

of the nation’s leading authorities on property law. The Insti-

tute also filed an amicus curiae brief in Dolan vy. City of

Tigard, among other important takings cases before this

Court. The Institute's brief focuses on the proper standard of

review when government regulations fully or partially restrict

the rights of property owners.

The Institute has obtained the consent of the parties to

the filing of this brief, and letters of consent have been filed

with the clerk.!

STATEMENT OF FACTS

This lawsuit reaches the Supreme Court after a protracted

dispute between the Respondent Del Monte Dunes and the

Petitioner City of Monterey (“the City”) over the develop-

ment of a 37.6-acre plot of oceanfront property located adja-

cent to a multi-family development, a railroad right-of-way,

and a state beach park.?

' Counsel for the parties in this case did not author this brief in whole

or in part. No person or entity, other than amicus curiae Institute for

Justice, its members, or its counsel made a monetary contribution to the

preparation and submission of this brief.

? The full statement of facts is drawn both from the decision below,

Del Monte Dunes at Monterey, Ltd. v. City of Monterey, 95 F.3d 1422 (9th

Cir. 1996), [hereinafter De! Monte 11) and from the fuller description of the

facts found in the earlier Ninth Circuit decision holding that respondent's

2

The subject parcel had cace been used as a petroleum

tank farm, and seven tank pads and other equipment had

remained on the site. In 1981, Respondent's predecessor in

title, Ponderosa Homes, sought the City’s permission to build

a 344-unit residential development cu the site. As part of its

application, Ponderosa had to submit for City approval a

tentative map outlining in detail its planned-unit-develop-

ment. See Cal. Gov't Code, §§ 66410 to 66499.58 (Deering

1997).

Ponderosa’s initial 344-unit proposal “was within the

residential density allowed on the site by the existing zoning

and general plan designations.” Del Monte 1, 920 F.2d at

1502. Nonetheless the City’s planning staff then asked for an

environmental impact statement, duly submitted if January

1982. The planning commission then rejected Respondent's

permit request, but invited submission of a plan for a project

with 264 units. That proposal was in turn rejected in Decem-

ber 1983, when the commission suggested a project with 224

units. Respondent submitted a proposal to that effect in early

1984, which was rejected first by the commission and then by

the City Council in March, 1984. The Council then instructed

the planning commission to consider a 190-residential-unit

development. In July 1984, the planning commission denied

Respondent's site plan for 190 units, but its decision was

overruled by the City Council in SeptemSer 1984. The Coun-

cil did not grant final permission to build but did give Pon-

derosa an eighteen-month conditional use permit for the

proposed site development. One of the fifteen required condi-

tions demanded assurance of habitat preservation for the

Smith's Blue Butterfly. This assurance had to meet the

approval of the California Department of Fish and Game

(DFG) and the United States Fish and Wildlife Service

(USFWS). Other conditions required the approval of the

Architectural Review Committee of the actual plans; still

constitutional challenge was ripe for adjudication. See De! Monte Dunes at

Monterey, Lid. v. City of Monterey, 920 F.2d 1496 (9th Cir. 1990),

[hereinafter Del Monte 1}.

3

others pertained to access, fencing, grading, underground

utilities, provision of moderate income housing, and sound-

proofing between units. See Del Monte |, 920 F.2d at 1503. In

late 1984 Ponderosa sold its interest to the Respondent, Del

Monte Dunes.

By August 1985, the professional planning staff had

recommended approval of the project, noting that “the pro-

posed subdivision [was] not likely to cause substantial envi-

ronmental damage or substantially and avoidably injure fish

or wildlife or their habitat.” /d. at 1504. But the planning

commission turned down the proposal in January, 1986, and

in June 1986, the City Council affirmed the denial of the

planning commission, noting that the site was “not physically

suitable for the type and density of the development proposed,

in that sand relocation and grading necessary for construction

of the project results in significant environmental impacts that

are not mitigable nor adequately addressed given the current

size of the project.” /d. at 1504. The City Council also found

that there was inadequate access to the project and that an

inadequate habitat had been supplied for the Smith's Blue

Butterfly. See id.

Thereafter the landowners brought suit against the City

in Federal Court for inverse condemnation. The City defended

on the ground that the action was not ripe, but in 1990, the

Ninth Circuit ruled for the landowner, and remanded the case

for trial. See Del Monte 1, 920 F.2d 1496. In September 1994,

the City again approved Del Monte’s proposed 190-unit

development, conditional on its ability to provide adequate

mitigation for adverse environmental impacts. Negotiations

dragged on for another eighteen months between Del Monte,

the City, the USFWS, the California DFG, and other inter-

ested experts and members of the public. Before the planning

commission, Del Monte introduced expert testimony to show

that it had met the appropriate environmental concerns; that

conclusion was disputed by USFWS and the California DFG.

The building permit was again rejected. Thereafter, Del

Monte again sued in District Court, and during the pendency

of the case sold its land to the state of California for $4.5

4

million, or $800,000 more than its purchase price. That deci-

sion left unaffected Del Monte’s suit against the City of

Monterey. When that case was tried, the jury awarded Del

Monte $1,450,000, and that decision was affirmed again by

the Ninth Circuit in September, 1996, fifteen years after the

original application was filed. In its decision, the Ninth Cir-

cuit noted that the jury passed on both relevant questions: was

there a legitimate public reason that justified the restrictions

in question, and did the restrictions in question deprive the

landowner of all viable economic use. The Court then exam-

ined both these claims and found that each was supported by

sufficient evidence. See Del Monte I], 95 F.3d at 1429-32

(legitimate justification) and id. at 95 F.3d at 1432-34 (eco-

nomic use). In April 1998 a writ for certiorari was granted.

SUMMARY OF ARGUMENT

This inverse condemnation case raises both procedural

and substantive issues.

Procedurally, the District Court allowed the jury to

decide (1) whether the City had legitimate public reasons to

restrict Del Monte’s use of its own property, and (2) whether

those restrictions had deprived it of all economic value. That

standard makes sense under Section 1983, which distin-

guishes between actions at law and suits in equity. An action

for damages for what would otherwise be an unlawful taking

more closely resembles a common law suit for trespass or

conversion than it does a suit in equity for specific perfor-

mance or an injunction. Absent any intention by Congress to

displace the ordinary division of labor between court and jury,

such as that governing federal condemnation actions under

Fed. R. Civ. P. 71A(h), the decision of the District Court, as

affirmed by the Ninth Circuit, was correct.

Wholly apart from its soundness, the critical issue in this

case is the standard of review that is brought to the takings

claim. The Ninth Circuit carefully reviewed both parts of the

takings issue. It first held that the jury had ample reason to

find that the City did not meet the “rough proportionality”

standard of Dolan v. City of Tigard, 512 U.S. 374 (1994) in

5

advancing its public justifications for the restrictions that it

imposed. It also held that the evidence supported the jury’s

determination that the regulations and conditions deprived

Del Monte of all economically viable use of the property.

The judgment below is easily defensible when both these

facts are found in conjunction. The total wipeout of all eco-

nomic use has been held by this Court in Lucas v. South

Carolina Coastal Council, 505 U.S. 1003 (1992) to be tanta-

mount to a physical taking. Just as with physical takings, the

City cannot expect the deference of the rational basis test to

evaluate the reasons for its actions. Rather, it must meet the

higher level of scrutiny enunciated in Dolan’s rough propor-

tionality test. The size of the wipeout inflicted and the danger

of abusive, factional behavior within local government poses

too great a risk for government decisions that work a massive

deprivation of constitutional rights.

The rough proportionality standard in Dolan should

apply even if the City’s restriction had worked only a partial

restriction of land use. As articulated in Nollan v. California

Coastal Commission, 483 U.S. 825 (1987), the takings clause

contains a specific substantive protection for private property

that cannot be overridden on a deferential rational basis

standard, such as that applicable to substantive due process or

equal protection claims. With partial restrictions, as with total

wipeouts, the dangers of faction, abuse and delay militate

against a deferential rational basis test that allows too much

abuse for too little sensible public gain. Local and state

governments often oppose development for reasons that are

parochial, anticompetitive and isolationist. Democratic mea-

sures of self-correction often fail because bodies frequently

give short shrift to the legitimate expectations of developers

and their potential customers who do not live and vote within

the state or its political subdivision.

This pattern of abuse and delay is evident in this lawsuit,

which has bounced back and forth through the courts for

nearly eighteen years. The rough proportionality standard

only requires courts to review public restrictions of private

6

development under the same type of standards that they have

long used in private disputes. In the short term, the rough

proportionality standard might increase the fraction of land

use planning decisions subject to judicial challenge. But in

the long run it should help reduce the frequency of litigation

by making state and local planning commissions fearful of

putting pointless obstacles in the path of ordinary develop-

ment that by no stretch of the imagination constitute a com-

mon law nuisance or an unreasonable burden on public

facilities.

ARGUMENT

I. Section 1983 Entitles Aggrieved Landowners to A Jury

Trial on the Basic Elements of Liability in a Regula-

tory Takings Claim.

A. The Basic Structure of Section 1983 Contemplates

Jury Trials for Money Damages in State Regula-

tory Takings Cases.

The first question presented in this case is whether a

plaintiff who brings an action under 42 U.S.C. § 1983 is

entitled to have the basic issues of liability determined by a

jury rather than by a court. Regulatory takings disputes usu-

ally raise two related questions. First, has the landowner been

denied all economically viable use of the property? If that

question is answered in the affirmative, then the inquiry shifts

to whether the rejection of the landowner’s development

application has substantially advanced a legitimate public

purpose. See Del Monte II, 95 F.3d at 1426. The Ninth Circuit

held that both these issues raised mixed questions of fact and

law which fell into the province of the jury, subject to review

by the court to correct against manifest error. The division of

fact-finding power between court and jury in regulatory tak-

ings cases follows the conventional pattern that has served

well in countless other contexts, ranging from ordinary tort

decisions to statutory causes of action under the anti-

discrimination laws. See, e.g., Lorillard v. Pons, 434 U.S. 575

(1978) (jury trial in age discrimination actions).

7

The advantages of this customary division of respon-

sibility are well understood and widely accepted. Using juries

allows members of the community to bring their own sense of

fairness to matters that turn heavily on the reasonableness of

government action, which is so central to this case. See Del

Monte 11, 95 F.3d at 1430. The judicial override offers a check

against runaway juries moved by passion and prejudice. The

court first sets the applicable legal standard; then the jury

makes the initial factual determination; finally, trial and

appellate courts set aside verdicts when juries reach mani-

festly indefensible decisions. Regulatory takings cases offer

no special reason to displace this time-honored division of

power as a matter of policy. Nor does anything in this Court's

decision in United States v Reynolds, 397 U.S. 14 (1970)

require the contrary. That decision only dealt with the divi-

sion of responsibility between judge and jury under rule

71A(h) of the Federal Rules of Civil Procedure, which gov-

erns federal condemnations in federal court, but which has no

impact on inverse condemnation proceedings brought against

state governments in federal court. Reynolds, 397 U.S. at 20.

B. This Court Should Decide the Important Substan-

tive Question of Constitutional Law even if it

Rules that the Trial Judge Should Resolve all

Questions of Liability in Regulatory Takings Dis-

putes.

The central issue in this case is not whether juries should

be excluded from any role in determining government lia-

bility in land use cases. Rather, it concerns the substantive

standards by which these government decisions will be

judged. The Court will surely have to face this critical issue

sooner or later, for even if the Ninth Circuit erred on this

procedural point, the substantive issue remains central to the

case on remand. Rather than allow that trial to take place in

ignorance of the applicable standard of review, it is better to

resolve the issue now on the strength of a detailed factual

record that permits full consideration of the relevant factors.

The implications of this issue are so profound for the health

8

of the nation as a whole that any delay in passing on the

question will unnecessarily allow uncertainty to fester in

countless other land use and permit disputes that raise similar

questions. A clear statement on the matter is required.

ll. The “Rough Proportionality” Standard of Dolan

Clearly Applies to Government Regulations that

Deprive Landowners of All Economically Viable Use

of their Property.

A. The Questions Presented Implicitly Address Situ-

ations in which State Regulations Have Deprived

Landowners of All Economically Viable Use of

Their Property.

The second and third questions presented in the City’s

petition for certiorari place in sharp relief the standard of

review for government action in inverse condemnation cases.

Question Two asks “whether liability for a regulatory taking

can be based on a standard that allows a jury or court to

reweigh the evidence concerning the reasonableness of a

public agency’s land use decision.” The presumed answer to

this question is “no,” which in effect allows government

agencies a free pass whenever they make individualized deci-

sions that restrict the use of private lands. Question Three

asks “whether the reasonable proportionality standard estab-

lished by this Court in Dolan v. City of Tigard, 512 U.S. 374

(1994), in the context of property exactions can be properly

applied to an inverse condemnation claim based upon a regu-

latory denial.”

As formulated, the questions presented elide a critical

point about the position of this case on appeal. The judgment

below must be sustained either (1) narrowly, that the Dolan

standard applies in all cases where the state seeks to justify

land use restrictions that totally destroy all economically

viable use or, (2) if this Court decides, broadly, that the

Dolan standard applies to all partial land use restrictions.

Amicus Curiae believes that the narrow proposition is already

well established as a matter of law, and that the broader

proposition is sound as a matter of constitutional principle.

9

Accordingly, this brief first addresses the more limited ques-

tion of the application of Dolan to cases of total wipeouts,

and then the broader issue of whether the Dolan standard

applies to State justifications for partial land use restrictions.

In dealing with this case, the City’s proposed answer is

that the state may be asked to justify its actions when it

conditions the issuing of a building permit on the surrender of

a possessory interest in property (a fee interest, or an ease-

ment) but not for any “mere” restrictions on land use, even

those that deprive the landowner of all economically viable

use of the land. Thus the Petitioner and the various Amici

claim that Dolan’s rough proportionality standard is limited to

cases of permanent physical occupation of once private lands.

In support of that position they point to the conclusion found

in such decisions as Clajon Production Corp. v. Petera, 70

F.3d 1566 (10th Cir. 1995): “Based on a close reading of

Nollan and Dolan, we conclude that those cases (and the tests

outlined therein) are limited to the context of development

exactions where there is a physical taking or its equivalent.”

Id. at 1578. (emphasis added).

Ironically the last clause of this sentence in Clajon

clearly supports the Respondent’s judgment below: the only

“equivalent” to a physical taking is an economic regulation

that deprives land of all beneficial economic use, which is

precisely the situation present in this case. Given the factual

posture of this case, the City’s position embraces an indefens-

ible anomaly. Generally speaking, the complete loss of all

economic use is treated like the physical dispossession of

private property because it is its functional equivalent. See

San Diego Gas and Electric Co. v. City of San Diego, 450

U.S. 621 (1981) (Brennan, J. dissenting); see also, Lawrence

Tribe, American Constitutional Law § 9-3 (2d ed. 1988)

(“Thus a taking occurs . . . when government controls a

person’s use of property so tightly that, although some uses

remain to the owner, the property’s value had been virtually

destroyed”). If the rough proportionality standard holds for an

exaction that leaves a landowner with many beneficial uses of

property, then it must surely apply to the greater loss of rights

that flow from the complete loss of all viable economic use.

10

Accordingly, the correct analysis of this case requires an

understanding of the two key elements of a regulatory takings

case: (1) did the government action deprive the landowner of

all viable economic use, and (2) was there a legitimate public

purpose that supported the state’s action.

B. The State Deprives An Owner of Vacant Land All

Beneficial Economic Use When the Totality of its

Permit Conditions and Restrictions Render Eco-

nomically Unviable Even the Ideal Development

Program.

The issue of whether government action has deprived a

landowner of all viable economic use arises in two separate

contexts. The first of these involves cases where the land-

owner is already making productive use of his property, but

wishes to make more intensive use of the land in question. In

Penn Central Transportation Co. v. City of New York, 438

U.S. 104 (1978), the owners of the Grand Central Terminal

sought to construct a major new structure in its upper air

space, which was denied under New York’s landmark preser-

vation ordinance. This Court refused to award Penn Central

compensation in part because Penn Central had not been

deprived of all economically viable use of its property. The

revenue from the land and building covered its costs and

allowed the owner a profit even in its current configuration.

The maintenance of the status quo does not offer the

government an escape hatch for land that has no current

productive use. To require land to remain vacant necessarily

strips away its entire economic use and thus rises to the level

of a compensable taking. That was the clear import of Lucas

v. South Carolina Coastal Council, 505 U.S. 1003 (1992),

where South Carolina prohibited all new construction on a

buildable beachfront lot. But constitutional obligation to com-

pensate is not limited only to cases that explicitly prohibit any

development of the land. A formal permission to build, cou-

pled with a set of restrictions that in combination make

building unprofitable, has the same practical effect as the

absolute prohibition. Accordingly, it has been treated in the

same fashion.

Thus, in Bowles v. United States, 31 Fed. Cl. 37 (1994),

the Army Corps of Engineers denied the landowner a permit

to fill his land for a septic tank, and required him (alone

among his neighbors) to “build a house on stilts and install a

holding tank sewer system without filling Lot 29 [his building

plot}.” /d. at 44. The sole use of the land was for a single

family residence, and the Court ordered compensation by

crediting the landowner’s evidence and by disregarding the

contrary evidence of the government. The Court found that

meeting the Corps’s requirements of an above-ground sewage

system gave the lot a negative value. /d. at 44. In contrast, the

cases that have refused to find a total deprivation of economic

use have typically involved situations where the regulation

itself explicitly preserved some profitable land use to its

owner. Thus, the landowner was not deprived of all economic

value in Outdoor Systems v. City of Tucson, 997 F.2d 604 (9th

Cir. 1993), when the City’s sign ordinance conditioned the

issuance of a valuable building permit on the dismantling of

any billboard on the land. Nor was a landowner deprived of

all economic use when prohibited from hunting “surplus

game” on its own property, although allowed to continue with

all of its other previously profitable activities. See Clajon

Prod. Corp. v. Petera, 70 F.3d 1566, 1575 (10th Cir. 1995). In

all these cases the residual uses allowed the owner to market

the land at a positive market value. Not so with the restric-

tions imposed on Del Monte: once the conditions were

imposed, any further development of its land would only add

to its financial losses.

C. The City of Monterey Has Not Shown that the

Total Deprivation of Viable Economic Use is Nec-

essary to Prevent any Nuisance-Like Harms to

Others.

The City of Monterey does not necessarily lose a regula-

tory taking case simply because a landowner has been

deprived of all economically viable use. But within that

12

confined context, it no longer suffices for the City to show

that the restrictions in question advance some broad objec-

tives of land use planning such as the preservation of open

spaces, see Agins v. City of Tiburon, 447 U.S. 255 (1980), or

growth control, see Schenck v. City of Hudson, 114 F.3d 590

(6th Cir. 1997). Rather, the City is put to a higher test in light

of the greater devastation that its regulations have wreaked.

Now it must show that this set of provisions was justified in

order to prevent nuisance-like harms to others. See Lucas v.

South Carolina Coastal Council, 505 U.S. 1003 (1992).

Notwithstanding their formal equivalence, the examina-

tion of the relevant justifications for government action does,

however, raise distinctive issues when the landowner’s tak-

ings claim rests on a complete loss of economic use as

opposed to the permanent occupation of land. Only in extraor-

dinary cases could a state justify the complete occupation as

necessary to prevent the occurrence of a common law nui-

sance. Except in extraordinary cases, some lesser restriction

on land use could achieve that same end. But that less-

restrictive alternative is not obviously available when govern-

ment land use regulations force a landowner to suffer a total

loss of economic use: in principle, these restrictions could be

the least restrictive means of preventing nuisance-like harm to

strangers, in which case they do not run afoul of the takings

clause.

D. Only Anti-Nuisance Justifications Suffice in

Cases Where Regulation Strips a Landowner of

All Economically Viable Use.

Lucas itself makes clear the limited types of justification

made available to the state when land use regulations work a

total taking. Thus this Court held that the state “may resist

compensation only if the logically antecedent inquiry into the

nature of the owner's estate shows that the proscribed use

interests were not part of his title to begin with.” Lucas v.

South Carolina Coastal Council, 505 U.S. at 1027. This Court

made the point still more explicit when it said:

13

{a} law or decree with such an effect must, in

other words, do no more than duplicate the result

that could have been achieved in the courts — by

adjacent landowners (or other uniquely affected

persons) under the State’s law of private nuisance,

or by the State under its complementary power to

abate nuisances that affect the public generally, or

otherwise.

Lucas, 505 U.S. at 1029.

In light of that standard, this Court remanded the case to

the South Carolina Courts to decide whether a total prohibi-

tion on new construction on plaintiff's beachfront lots was

consistent with the common law of nuisance (which contains

the implicit limitations on use inherent in fee simple owner-

ship). The South Carolina Court held it did not. See Lucas v.

South Carolina Coastal Council, 309 S.C. 424, 424 S.E. 2d

484 (1992).

Lower court decisions have then held that the state bears

the burden of proof on this critical question of nuisance

prevention:

When a total regulatory taking occurs the govern-

ment can resist compensation only if the nature of

the owner's estate shows that the proscribed use

was not part of the owner’s property right to begin

with. . . . In the case of a fee simple estate in land

the government has the burden of proof to demon-

strate that the prohibited use of the property consti-

tutes a nuisance under state common-law doctrine.

It cannot hide behind conclusory legislative find-

ings that simply characterize land use restrictions as

harm-preventing.

Bowles v. United States, 31 Fed. Cl. 37, 45 (1994). (emphasis

added).

Bowles then applied this test by holding that “building a

house” is not a common law nuisance. /d. at 49. The same

logic applies in this case. There is simply no credible argu-

ment that the construction of a housing complex on a dune

near the beachfront is a nuisance. That was the conclusion in

14

Lucas and it has to be the conclusion here. The state may

want to preserve land in its natural state, whether for tourism

or for needed habitat, but if so the condemnation option

always remains open to it. The power of eminent domain

confers on the state the extraordinary power to take private

property without the consent of its owner. But it authorizes

only condemnation, not public theft. Ordinary individuals

who obtain consent must pay for what they take. All the more

reason why the state must pay for what it takes without

consent. That extraordinary government power to take with-

out landowner’s consent cannot under our Constitution be

transmuted into the tyrannical power to take without compen-

sation. Confiscation is not allowed when the government

permanently occupies land. It should not be allowed here with

its functional equivalent — the stripping away of alk economic

use of the property. The short, simple truth is that the state's

own preferred justifications for its actions fall short of what

Lucas requires of it. For these reasons alone the decision of

the Ninth Circuit should be affirmed.

E. The Dolan Rough Proportionality Standard Gov-

erns State Justifications for Total Land Use

Wipeouts.

At present this Court has adopted a strict scrutiny stan-

dard whenever the government takes permanent physical pos-

session of private property. See Loretto v. Teleprompter

Manhattan CATV Corp., 458 U.S. 419 (1982). That rule holds

whether the government occupies the land or authorizes pri-

vate parties to occupy it, as was the situation in Loretto when

the cable company’s box was placed on the roof of the

landowner’s apartment building. As noted earlier, Lucas

expressly adopted the language of strict scrutiny when it

examined the state's justification for imposing land use

restrictions.

The applicable standard of review in Lucas stands in

sharp opposition to that used with partial restrictions on land

use, i.e. those that do not deprive the landowner of all eco-

nomically viable use of his property. See Dolan, 512 U.S. at

ee ~~

15

385, n.6. Historically, the rational basis standard of review

dominated takings cases under the jurisprudence of this

Court. That standard (although not those exact words) gov-

erned this Court's initial foray into zoning law in City of

Euclid v. Ambler, 272 U.S. 365 (1926). It was more con-

sciously applied in Goldblatt v. City -’ Hempstead, 369 U.S.

590 (1962). Nollan v. California Coastal Commission, 483

U.S. 825 (1987), marked a self-conscious retreat from the

earlier trend and the acceptance of a higher standard of

review.

Nollan addressed the situation in which the state was

willing to issue a building permit if the landowner was pre-

pared to submit to the exaction of a lateral easement across its

land. This Court rejected the state’s effort to bundle the

easement with the building permit when the easement was

unrelated to the state’s asserted interest in preserving a view-

ing easement from the public highway over Nollan’s land to

the Pacific Ocean. In so doing, Nollan explicitly rejected any

assimilation of takings cases to the lower rational basis stan-

dard, which has long been the norm in equal protection or due

process challenges to state regulation of ordinary economic

liberties (chiefly to buy and sell goods and services at unregu-

lated prices or wages). See Williamson v. Lee Optical of

Oklahoma, 348 U.S. 483 (1955). Thus Nollan states (in lan-

guage that supports both Respondent's broad and narrow

claims) that

there is no reason to believe (and the language of

our cases gives some reason to disbelieve) that so

long as the regulation of property is at issue the

standards for takings challenges, due process chal-

lenges, and equal protection challenges are identi-

cal; any more than there is any reason to believe

that so long as the regulation of speech is at issue

the standards for due process challenges, equal pro-

tection challenges, and First Amendment challenges

are identical.

483 U.S. at 836, n.3.

Thereafter the Court limited Goldblatt by noting that it

does “appear to assume that the inquiries are the same, but

16

that assumption is inconsistent with formulations of our later

cases.” /d.

The exact level of the increased scrutiny required under

the takings clause was not fully settled in Nollan because of

the utter lack of any nexus between the lateral beachfront

easement and the viewing easement. It fell to Dolan to test

the closeness of the relationship between the exactions

demanded and the state justifications for their use. In Dolan,

the plaintiff wished to double the size of her plumbing supply

store, but was told by the City that she could obtain the

necessary permits only by deeding over portions of her land

for use as a flood plain and a pedestrian/bicycle pathway. This

Court recognized that these restrictions in principle could be

related to legitimate public ends, but steadfastly refused to

defer to the City’s judgment on the closeness of that connec-

tion. In remanding the case, this Court held that the state must

demonstrate a “rough proportionality” that linked the exac-

tions imposed to the ends they served.

In articulating this rough proportionality standard, this

Court reviewed the decision standards of state courts to

decide whether the findings made in Dolan “are constitu-

tionally sufficient to justify the conditions imposed by the

city on Petitioner's building permit.” Dolan, 512 U.S. at 389.

More specifically, the Court first rejected a rational basis

standard of review under which “very generalized statements

as to the necessary connection between the required dedica-

tion and the proposed development seem to suffice.” /d. at

389. At the opposite extreme, this Court also rejected a “very

exacting correspondence, described as the ‘specifi{c] and

uniquely attributable’ test.” “We do not think the Federal

Constitution requires such exacting scrutiny, given the nature

of the interests involved.” /d. at 389-90.

This Court then opted for the rule adopted in the majority

of states that “have taken an intermediate position, requiring

the municipality to show a ‘reasonable relationship’ between

the required dedication and the impact of the proposed devel-

opment.” /d. at 390. Nonetheless this Court was uncomfort-

able with this verbal formulation.

17

We think the ‘reasonable relationship’ test

adopted by a majority of the state courts is closer to

the federal constitutional norm than either of those

previously discussed. But we do not adopt it as

such, partly because the term ‘reasonable relation-

ship’ seems confusingly similar to the term ‘rational

basis’ which describes the minimal level of scrutiny

under the Equal Protection Clause of the Fourteenth

Amendment. We think a term such « ‘rough pro-

portionality’ best encapsulates what we hold to be

the requirement of the Fifth Amendment. No pre-

cise mathematical calculation is required, but the

city must make some sort of individualized deter-

mination that the required dedication is related both

in nature and extent to the impact of the proposed

development.

Id. at 391.

At this juncture Euclid, with its rational basis approach,

was explicitly distinguished on the ground that it involved

“generally applicable zoning regulations,” in contrast to the

city’s “adjudicative decision to condition Petitioner's applica-

tion for a building permit on an individual parcel,” where “the

burden properly rests on the city.” /d. at 391, note 8. See also

id. at 385 (contrasting the “essentially legislative determina-

tions classifying entire areas of the city,” with the “adjudica-

tive decision” involved in passing on Dolan’s application).

The clear import of these passages is that rough propor-

tionality is tantamount to intermediate scrutiny in the choice

of means to reach the set of antinuisance objectives.

The rejection of rational basis review applies with

undiminished force in the current case. No one doubts that

Del Monte had complied with all general zoning ordinances in

its initial permit application. All the objections to its pro-

posed plan of construction rested alleged defects in that

program that depended on conditions that apply to every

coastal dune in the United States. All dunes contain high and

low points. How easy it is to allege that building on the high

ground blocks views over the land, while building on the low

portions could have some impact on drainage; or that each

plot of undeveloped land could in principle serve as habitat

for some species, endangered or otherwise, of interest to the

State.

We are far from suggesting that the state is incapable of

acting when it is prepared to compensate for the losses that it

wishes to impose on the landowner and his potential pur-

chasers. In this case, however, these concerns have been

invoked to delay for years development on this parcel and this

parcel only. Yet the City’s reasons for denying a building

permit contained only cookbook responses that could have

been drafted in complete ignorance of the evidence gathered

in this case. Indeed, if anything, the “findings” here were iess

informative than those rejected as insufficient in Dolan, for

there at least flood plain and traffic control counted as

unquestionable ends of the state’s police power. In contrast,

the stylized responses offered by the City of Monterey did not

reveal any discernible harm to public lands or waters; nor did

they show any harm to the property of any neighbors; nor did

they show any excessive demands on infrastructure that have

been the concern in recent federal appellate opinions; see,

e.g., Schenck v. City of Hudson, 114 F.3d 590 (6th Cir. 1997),

or state court opinions, see Sprenger, Grubb & Associates,

Inc. v. City of Hailey, 127 Idaho 576, 903 P.2d 741 (1995). At

most they demonstrated an awareness of the inevitable envi-

ronmental change that accompanies any development any-

where. If the rough proportionality standard carries over to

this case, then the decision of the Ninth Circuit must stand.

19

Ill. Even in Cases of Partial Land Use Restrictions The

Rough Proportionality Standard Should be Adopted.

A. Rough Proportionality Reconciles the Need to

Curb the Sum of Private and Public Abuse.

The broad version of the question presented in this case

is whether the rough proportionality standard should be

applied to review government justifications for partial land

use restrictions. Legal authority on this point is surely

divided. This Court’s decision in Nollan points to the general

rejection of a rational basis standard in connection with speci-

fic substantive guarantees, such as the takings clause. But the

Circuit Court and state court decisions distinguished above,

all take the position that the rough proportionality standard of

Do'in only applies to exaction or dedication cases. Amicus

Curiae submits that the higher standard of rough propor-

tionality review is appropriate with regard to the full range of

land use restrictions.

The Constitution and Bill of Rights contain a large

number of individual guarantees, but they contain no explicit

instructions on the standard of scrutiny that should be used.

The various government parties attacking the Ninth Circuit

decision write as though the only real issue at stake involves

preserving the “flexibility” of government to make land use

decisions, including those relevant to the preservation of

endangered species. See, e.g., Amicus Curiae Brief for the

United States, supporting the Petitioner in Part, at 1. In so

doing, they act as though the only goal is to preserve the

appropriate sphere of action for virtuous and informed gov-

ernment action. Our Constitution takes a different view of

government action. On the one hand it obviously authorizes

official action at all levels, but it does so with a keen appre-

ciation of the abuses that can subvert its sound operation.

Ever since Federalist No. 10 articulated the danger of faction,

the theory of constitutionalism poses a more complex inquiry

than Petitioner’s one-sided account acknowledges. The issue

is not merely how to preserve government flexibility for

constructive ends. Rather, it is how to preserve government

flexibility for constructive ends without giving the state carte

20

blanche to perform destructive actions. Our Constitution thus

always performs the balancing act of both authorizing and

limiting government action. So the real question is how is that

best done?

The problem is best understood by linking the choice of

standard to the costs of an erroneous decision under condi-

tions of uncertainty. Any judicial judgment on constitu-

tionality is subject to two types of errors. See generally David

C. Baldus & James W. L. Cole, Statistical Proof of Discrimi-

nation 291-92 (1980). Type I error is to uphold a constitu-

tional challenge to lawful government action that should be

allowed. Type II is to permit a government action that should

be prohibited. It is impossible to eliminate both types of error

simultaneously since they are inversely related. The only way

to eliminate the last bit of one type of error is tO increase

substantially the error rate of the other type. If both forms of

error were weighted equally, then the ideal strategy would be

simply to reduce the sum of the errors, without regard to their

direction — which offers a sensible interpretation of the stan-

dard of rough proportionality (or intermediate scrutiny) under

Dolan. But let one type of error be weighted more heavily

then the other, and the balance shifts accordingly. Greater

attention should be paid to eliminate those errors that carry

with them the more serious negative consequences.

The various standards of constitutional law respond to

these different weights of error. A strict scrutiny standard is

used when this Court adjudges the errors of commission to be

far greater than the errors of omission. The rational basis

standard is used when this Court adjudges the errors of

omission to be far greater than the errors of commission,

leaving intermediate scrutiny to cover those cases where

errors are of roughly equal weight. An intelligent program of

constitutional adjudication necessarily makes rule-of-thumb

estimations of the gravity of error in certain well-established

categories. It is not possible at this juncture to analyze how

this framework applies to the various freedoms protected by

the Bill of Rights, or to the various classifications (race, sex,

age, alienage, wealth) that could be challenged under the

equal protection clause. But in the takings area, it is clear that

21

the strict scrutiny standard requires the state to pay compen-

sation when it permanently dispossesses the owner of private

land.

The situation is more complex when land use regulation

is at stake, for the difficulties with harmful spillovers are no

longer so easily dismissed. It is this reason that best explains

Dolan’s rejection of the strict scrutiny standard adopted in

some states. See Pioneer Trust & Savings Bank v. Mount

Prospect, 22 IN. 2d 375, 380, 176 N.E.2d 799, 802 (1961).

The construction of a hard surface covering in one area could

lead to dangerous runoff in other areas. The construction of a

new shopping center or apartment complex will increase the

demands of roads and infrastructure. A strict scrutiny stan-

dard could easily be held to frustrate the efforts of the state to

make sure that the actions of some individuals do not impose

untoward costs on nearby property, public or private. Dolan

thus treats the risk of private abuse as too great to justify

strict scrutiny, at least under federal constitutional law -

leaving open the possibility that state constitutions might

impose higher standards of review on their own legislative

and administrative processes.

If private abuse (such as harmful spillovers) were rou-

tinely curbed by well designed state regulation, then the error

minimization framework could justify the rational basis stan-

dard of review. State and local governments could never be

faulted for their dubious motivation or their insufficient

knowledge. Since the risk of official misconduct is nil, the

vast deference required under the rational basis standard

would provide the proper theoretical norm. But the question

of abuse of state and local power cannot be dismissed cava-

lierly. Even in those cases that do not result in a total depriva-

tion of economic value, a landowner could suffer the loss of

seventy-five or eighty percent of land value, amounting in

individual cases to millions of dollars of loss. In those situa-

tions, it is easy to recognize that vast powers of state and

local government operate as a two-edged sword, capable of

being turned to parochial as well as public-spirited ends. It

was just that concern with arbitrary state and local power that

led Madison to trumpet the virtues of the extended republic in

22

Federalist No. 10. The dangers and vagaries of any system of

political logrolling lay at the root of the public choice move-

ment. See generally James Buchanan & Gordon Tullock, The

Calculus of Consent (1962). And F.A. Hayek has exhaustively

demonstrated the dangers and inevitable impossibility of cen-

tral planning. See, e.g., The Road to Serfdom (1944); The

Constitution of Liberty (1960); The Fatal Conceit: The Errors

of Socialism (1989). No one can deny that local governments

often have superior knowledge of local conditions. But, by

the same token, no one can deny that the virtues of commu-

nity participation and reasoned deliberation often yield to the

dangers of political faction and legislative or administrative

capture. Here, as in other contexts, the law of diminishing

returns sets in. The last bit of private abuse that is ferreted out

by public agencies operating under the rational -basis test

paves the way for substantial amounts of public abuse com-

mitted by state and local governments whose activities are,

under that test, virtually immunized from constitutional scru-

tiny.

The risk of government misconduct is serious and

endemic, and it reaches partial land use restrictions with the

same fury as total wipeouts. It stems from the frequent mis-

match between private landholdings and political power. An

individual owns a valuable parcel in a given community, but

has few, if any, votes to protect him from the restrictions

imposed by a determined majority. Worse still is the position

of individuals who live outside the local community and own

no property within it, for they cannot register their prefer-

ences in the political process, for they cannot identify them-

selves until the project is ready for sale or lease.

This fuller picture of state and local government there-

fore reveals substantial costs to both kinds of error. In the

exaction context, a rational basis test outweighs the fears of

excessive private misbehavior relative to the equal risks of

excessive localism and protectionism. Rough proportionality,

with its appeal to intermediate scrutiny, recognizes the

approximate parity in the two forms of error. It does not fixate

on private misconduct while allowing government abuse to

multiply free of judicial review.

23

This rough proportionality standard does not eliminate all

prospect of abuse, but it helps achieve the right legal objec-

tive, which is to minimize the expected costs of the two forms

of error. In particular, the intermediate scrutiny standard takes

into account the obvious point that more state and local land

use regulation does not necessarily lead to better state and

local land use regulation. It may be relatively easy to elimi-

nate the most obvious forms of error by taking some simple

steps, such as imposing restrictions against pollution, dis-

charge, and other common law nuisances. Any effort to insu-

late all state and local actions from constitutional scrutiny

ushers in, however, the endless rounds of official obstruction

that mark and mar the record in this case.

Any other result would be unwise because it would erect

an unnecessary categorical divide between easements (that

allow entry that would otherwise constitute a trespass) and

restrictions (that prohibit uses that would otherwise be law-

ful) that destroy or impair economic viability. But the politi-

cal forces that lead to local abuse are equally powerful in both

these situations. Any legal regime that guarded against exac-

tions while allowing land use restrictions to impose total

wipeouts would lead to perverse economic results. The Con-

stitution would prevent local governments from imposing

easements that cost $100 as a condition to exercise develop-

ment rights worth $1,000. But the Constitution would stand

mute as state and local governments condition development

on accepting land use conditions that reduce those same

development rights by $500, if they don’t wipe them out

altogether.

B. The Need for Judicial Oversight is as Great in

Land Use Restriction Cases as it is in Exaction

Cases.

Judicial scrutiny of government behavior in exaction

cases ultimately rests on the awareness of the inherent limita-

tions of the political process. The same concerns carry over to

state and local land use restrictions that impose substantial

economic losses.

24

First, Dolan stressed the great dangers of individualized

exactions, as opposed to generalized zoning ordinances. See

Dolan, 512 U.S. at 385 and 391, n.8, discussed supra at 22.

This last worry is fully vindicated here since Del Monte had

satisfied all general zoning requirements but was tormented

for years with an endless array of individualized planning

reviews that resulted in a complete rebuff of its ability to

build on its own tract of land.

Second, the same constellation of state and local political

forces are at work with these ad hoc land use restrictions as

with exactions and dedications. Local residents and planning

commissions could easily vote against a proposed project that

promises large gains for its potential residents because it

imposes some small loss or inconvenience on local residents.

But a rational basis test will not uncover these abusive restric-

tions because the state can always show some reason for the

action, namely, that it will benefit the majority who voted for

it. Only the standard of reasonable proportionality can exam-

ine the purported reasons for the decision and expose the

parochial interests that led to its passage.

Third, this case shows that it is unwise to assume that the

use of a rough proportionality standard heralds a return to the

Lochner era in which the economic and social decisions of

state legislatures were constantly second-guessed by courts.

See U.S. Amicus Curiae Brief at 13, n.6, claiming that closer

review would turn the federal courts into super-zoning

boards. See also Schenck, 114 F.3d at 593. But these fears are

quite groundless. The question in this case is whether the

state can point to some legitimate interest that justifies the

restriction in question.

On this score it makes good sense to ask about the

legitimacy of the ends and the appropriate nature of the

means. On the first point, the concerns with habitat preserva-

tion may be honored by condemnation, but they should never

be respected as the grounds for a simple declaration that a

parcel of land is off-limits for all forms of development. The

simple reason is that this purported justification places no

limit on state appetites. First, one level of government could

insist that portions of the land be set aside for habitat to

25

“mitigate” the harms from development. But in the next

breath, another state or federal agency could find yet another

environmental peril that requires still more land to be set

aside. And then a third. The combined effect of these attacks

is to wipe out all value of land because the landowner cannot

by agreement with any single agency obtain the clarity of title

needed for ordinary development. The land will be taken little

by little, and each government agency will hide behind the

actions of the others. The rough proportionality standard

blocks these dubious stratagems by looking both at public

ends and the public means. So implemented, that standard

prevents the endless train of public misconduct that has fes-

tered under the rational basis test, without hamstringing pub-

lic efforts at environmental protection.

The common law baselines in Lucas thus work to stabi-

lize relations between the multiple layers of the government

and an individual landowner. With the police power ends of

the government properly defined, the only factual questions at

hand are those already identified in Lucas: does a neighbor

(or the public as an agent) have reason to enjoin the develop-

ment. That standard will reduce (for good reason) the levels

of government activity, which in turn should lead to a reduc-

tion in the level of administrative and judicial action in land

use matters. The City simply has no case to impose these

restrictions on Del Monte under California's definition of

nuisance law. See Cal. Civ. Code § 3479 (West 1998) (Nui-

sance Defined):

Anything which is injurious to health, or is

indecent or offensive to the senses, or an obstruc-

tion to the free use of property, so as to interfere

with the comfortable enjoyment of life or property,

or unlawfully obstructs the free passage or use, in

the customary matter, of any navigable lake, or

river, bay, stream, canal, or basin, or any public

park, square, street, or highway, is a nuisance.

A close look at this record shows the evident virtues of

this state law standard. T xe City for over a dozen years used a

combination of exactions and restrictions to foil routine

26

beachfront development, which by no stretch of the imagina-

tion constitutes a nuisance at common law. The first wave in

its assault was the demand that Del Monte set aside the

western third of its land for public beach use and access. That

demand simply imitates on a grander scale the lateral ease-

ments that the California Coastal Commission claimed in

Nollan and the bike and pedestrian path claimed in Dolan.

Next the City imposed on Del Monte a requirement that it

take active steps to preserve the buckwheat habitat for the

Smith's Blue Butterfly (only one of which was observed on

the property in 1984. See Del Monte I], 95 F.3d at 1431.) The

decision could be treated as a simple land use restriction, yet

on the other hand it also looks very much like a special tax for

the privilege of real estate construction that should also be

caught under the Dolan rationale.

Any requirement that certain portions of land be left in its

natural state verges on a demand that the property be conveyed to

the government for use as a nature preserve. But one great advan-

tage of a unified approach to land use regulation is that courts no

longer have to ask the question of whether this government action

amounts to a possessory taking when the landowner may exclude

all others, but cannot enter or use the land himself, and thus is

forced to stand in the same distant relationship to his land as a total

stranger. Why should the government reap the benefits of fee

ownership without having to go through the usual formalities of

taking title to the property? See Pumpelly v. Green Bay Co., 80

U.S. 166 (1871).

More generally, exactions segue into land use restrictions

on the remaining portions of Del Monte’s parcel. As men-

tioned previously, dunes always have high and low points. So

it is an easy maneuver for the state to claim that it is improper

to fill in the low, or “bow!” areas on the land because that will

create environmental hazards. It is then just as easy to claim

that it is also impossible to build on the high portions of the

27

land because the development might block a view corridor to

the ocean, or might be seen from public highways or other

public lands. Under the rational basis test advocated by the

City, the state can multiply without end the permissible objec-

tives of land use regulation and then choose the broadest

possible means to achieve them. Each individual restriction is

looked at in isolation even when in combination they wreak

devastation on any and all development programs.

IV. State and Local Governments Have Taken Advantage

of Judicial Deference to Frustrate The Reasonable

Expectations of Property Owners.

The level of deference demanded by the City and its

numerous Amici must fall given the long-track record of

government planning abuse that it fosters. One lesson that

state and local governments learned after Lucas was that a

simple outright prohibition on new development could expose

them to liability for hefty sums from the land rendered worth-

less by their decisions. The political dynamics of state and

local governments, however, quickly resulted in the erection

of partial barriers to either delay or block the development of

land. Just that result happened in South Carolina after Lucas,

when the state’s original flat prohibition against all beach-

front development was scrapped once it became clear that it

was vulnerable to takings challenges. In its place came a far

more complex statutory framework with more elaborate spe-

cial permitting provisons. See S.C. Code Ann. § 48-39-290(D)

(Law Co-op. 1997). Yet the new procedures contain no limita-

tions that force decisions to be made within some reasonable

time after the application has been made. Rather the systems

allow local planning commissions to take advantage of Wil-

liamson County Regional Planning Commission v. Hamilton

Bank of Johnson City, 473 U.S. 172 (1985), which holds that

judicial review of planning commission action is normally

precluded until a final judgment has been entered against the

landowner.

28

Unfortunately, Williamson became an open invitation for

planning commissions to kill land use development by plying

developers with endless opportunities to be heard. Tradi-

tionally government was feared for its arbitrary decisions

made without hearings and notice to the parties. The new

wave of abuse, so clearly evident in this case, features endless

inspections, reports, filings and hearings whose sole purpose

is coldly calculated to block access to the courts by postpon-

ing finality until the will of the landowner is broken. The late

Grant Gilmore could well have had planning commissions in

mind when he wrote: “The worse the society, the more law

there will be. In Hell there will be nothing but law, and due

process will be meticulously observed.” Grant Gilmore, The

Age of Anxiety, 84 Yale L. J. 1022, 1044 (1975). Procedural

Hell also has its unintended ironies. In this very case, the

planning commission received five separate proposals for real

estate development and then had the temerity to argue (unsuc-

cessfully) in federal court that Del Monte’s compensation

claim was not yet ripe for adjudication. See Del Monte Dunes

1, 920 F.2d 1496 (9th Cir. 1990).

Planning commissions have also resorted to endless liti-

gation to subvert this Court's holding in First English that

compensation must be paid for final decisions that lead to

regulatory takings that deprive a landowner of all economi-

cally viable use for a limited period of time. First English

carved out an apparently innocent exception for cases “of

normal delays in obtaining building permits, changes in zon-

ing ordinances, variances, and the like which are not before

us.” First English Evangelical Lutheran Church of Glendale

v. Los Angeles County, 482 U.S. 304, 321 (1987). Yet once

again the definition of a “normal delay” has been stretched

beyond all recognition by the California Supreme Court,

which denied compensation for interim losses when the delay

issuing a development permit took place “partly owing to the

mistaken assertion of jurisdiction by a government agency.”

See Landgate, Inc. v. California Coastal Comm'n, 17 Cal. 4th

1006, 953 P.2d 1188 (1998). The landowner has to pay for the

mistakes of the planning agency, which of course gives that

agency painless incentives to make aggressive assertions of

29

jurisdiction. To date, the instant case has resulted in 17 years

of wrangling and confusion. How much better it is for the

City to be put to a clear choice: condemn the land or have

your planning restrictions subjected to a rough proportionality

standard.

No one can claim that rough proportionality to evaluate

state justifications for land use restrictions will solve all the

problems of real estate development in California or any-

where else. But here is a case where the consistent application

of sound constitutional principles should not be deterred by

cries of wolf from local governments who claim that the

takings clause constrains their prerogatives. That it will

indeed do as noted by this Court in First English, 482 U.S. at

321. But it will do so for sound constitutional reasons. The

decision of the Ninth Circuit sends a much needed message to

local governments that their stubborn disrespect for the prop-

erty rights of local landowners carries with it a price.

CONCLUSION

For the foregoing reasons, the decision of the Ninth

Circuit should be affirmed, and the judgment of $1,450,000 in

favor of Del Monte should be affirmed.

Respectfully submitted,

RicnHarp A. Epstein INstTITUTE POR JUSTICE

1111 East 60th Street *Witiam H. Mettor

Chicago, IL 60637 Cunt Bouck

(773) 702-9494 Scorr G. Buttock

Suite 200

1717 Pennsylvania Ave., NW

Washington, DC 20006

(202) 955-1300

* Counsel of Record