# Amicus Curiae Brief — Emmerman Et Vir v. City of Highland Park, Illinois

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386008_1019%3A4

## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 2004
- **Citation:** 543 U.S. 984

## Text

(3) ; ‘Supreme —— us. |
OCT 6 - 2004
No. 04-242
se OFFICE OF THE CLERK
In the
Supreme Court of the United States
=

ESTER P. EMMERMAN AND RONALD Z. EMMERMAN

Petitioners,
Vv.

CITY OF HIGHLAND PARK, ILLINOIS, ET AL.

Respondents.

—¢
On Petition for Writ of Certiorari to the Appellate Court
of Illinois, Second District
ions

MOTION FOR LEAVE TO FILE BRIEF AMICUS
CURIAE AND BRIEF AMICUS CURIAE OF
NATIONAL ASSOCIATION OF HOME BUILDERS IN
SUPPORT OF PETITIONERS ESTER P.
EMMERMAN AND RONALD Z. EMMERMAN

—¢

DUANE J. DESIDERIO DWIGHT H. MERRIAM*
Of Counsel *Counsel of Record
National Association of PATRICK J. SWEENEY

Home Builders Of Counsel

1201 15" Street, NW Robinson & Cole, LLP
Washington, DC 20005 280 Trumbull Street
Telephone: (202) 266-8200 Hartford, Connecticut 06103
Facsimile: (202) 266-8161 Telephone: (860) 275-8200

Facsimile: (860) 275-8299

Counsel for Amicus Curiae National Association of Home Builders

MOTION FOR LEAVE TO
FILE BRIEF AMICUS CURIAE

Pursuant to this Court's Rule 37(b), the National
Association of Home Builders respectfully requests leave of
| the Court to file this brief amicus curiae in support of
Petitioners Ester and Ronald Emmerman. Written consent
for amicus participation in this case was withheld by
Respondent City of Highland Park. Written consent was
granted by counsel of record for Petitioners.

INTEREST OF AMICUS CURIAE

The National Association of Home Builders
("NAHB") represents over 215,000 builder and associate
members throughout the United States. Its members include
people and firms that construct and supply single family
homes as well as apartment, condominium, commercial and
industrial builders, land developers and remodelers. It is the
voice of the American shelter industry. It is, therefore,
concerned with any judicial decision that calls into question
the remedy available to its members under the Fifth
Amendment when land use regulators take private property
for public use without the payment of just compensation.

NAHB, whose members are highly dependent on
land use decisions made by government bodies, has appeared
before this Court as amicus curiae, of counsel, or a party in a
number of cases involving the rights and remedies of
landowners who have been adversely affected by
governmental actions. These include Agins v. City of
Tiburon, 447 U.S. 255 (1980); San Diego Gas & Electric
Co. v. City of San Diego, 450 U.S. 621 (1981); Williamson
County Reg'l Planning Comm'n v. Hamilton Bank, 473 US.
172 (1985); MacDonald, Sommer & Frates v. Yolo County,
477 U.S. 340 (1986); Nollan v. California Coastal
Commission, 483 U.S. 825 (1987); Yee v. City of Escondido,
503 U.S. 519 (1992); Lucas v. South Carolina Coastal
Council, 505 U.S. 1003 (1992); Dolan v. City of Tigard, 512

l

U.S. 374 (1994); Babbitt v. Sweet Home Chapter of
Communities for a Great Or., 515 U.S. 687 (1995); Suitum v.
Tahoe Regional Planning Agency, 520 U.S. 725 (1997); City
of Monterey v. Del Monte Dunes at Monterey, Ltd., 526 U.S.
687 (1999); Solid Waste Agency of N. Cook County v. U.S.
Army Corps of Eng'rs, 531 U.S. 159 (2001); Palazzolo v.
Rhode Island, 533 U.S. 606 (2001); Tahoe-Sierra
Preservation Council, Inc. v. Tahoe Reg'l Planning Agency,
535 U.S. 302 (2002); Borden Ranch P'ship v. U.S. Army
Corps of Eng'rs, 537 U.S. 99 (2002); City of Cuyahoga Falls
v. Buckeye Cmty. Hope Found., 538 U.S. 188 (2003); S. Fla.
Water Mgmt. Dist. v. Miccosukee Tribe of Indians, 124 S. Ct.
1537 (2004).

For these reasons, the motion of National Association
of Home Builders to file a brief amicus curiae should be
granted.

DATED: October, 2004.

Respectfully Submitted,

DUANE J. DESIDERIO DWIGHT H. MERRIAM*

Of Counsel *Counsel of Record

National Association of PATRICK J. SWEENEY

Home Builders Of Counsel

1201 15" Street, NW Robinson & Cole, LLP

Washington, DC 20005 280 Trumbull Street

Telephone: (202) 266-8200 Hartford, Connecticut 06103

Facsimile: (202) 266-8161 Telephone: (860) 275-8200

Facsimile: (860) 275-8299

Counsel for Amicus Curiae National Association of Home Builders

eg —

TABLE OF CONTENTS

I. SUMMARY OF | ]
ON eedactsetesseesciecesclassceecctee. eenseasees......... ]
A. The Relevant Parcel Issue ..........000000000-.00.. Fs

B. This Court’s Relevant Parcel J urisprudence
Has Produced More Questions Than
SUE trnstihnssincscensicechasconsseoinnieaiavarscesec,..... o

1. Conflicting Answers to the Relevant
Parcel Question: Mahon and
ASTD +

rs Making Sense of the Contradiction:
Penn Central and Andrus................. 6

3. Another Change in J urisprudence:
Lucas and Palazzolo 0.0.0.0... 10

is Confusion in This Court’s Relevant Parcel
Jurisprudence Has Caused a Circuit Split .....11

a * Federal Trial Courts Are Also Confused By
the Relevant Parcel Issue.........eeccecccceos---. 16

RNIN ssc sassscsssessszccesssensesiansessossssssessasesace,.. 19

TABLE OF AUTHORITIES :

Anarus v. Allard,
Es ee TD Gets tnentclcababicndaaindaanebitnicaes 8,9, 12

Armstrong v. United States,
a wise ct ancsienniciniiaesieaiccibenidisicibiniiins 10

Ciampitti v. United States,
ee See se Re ee Ss. CPEB renin 15

District Intown Properties Ltd. P'ship v. District of
Columbia, .
198 F.3d 874 (D.C. Cir. 1999) .......... 3, 10, 11, 14, 15, 16

Florida Rock Industries, Inc. v. United States,
MS Fed. CL. Zi Clee, Ci. BGI) vccsissssinicesevnsesssenes 17, 18, 19

Forest Properties, Inc. v. Big Bear Municipal Water
District.,
er ee CA, BO CA, TF Piricvnwisicsaresirsimamirioonics 17, 18

Keystone Bituminous Coal Ass’n v. DeBenedictis,
SP UE. SFO CEFF D siicniccenscavevnsininaiorsce 4, 5, 6, 8,9, 10, 15

Loveladies Harbor, Inc. v. United States,
28 F.3d 1171 (Fed. Cir. 1994).....3, 11, 12, 13, 14, 15, 16

Lucas v. South Carolina Coastal Council,
OR OE, fj renee 1,2, 3, 10, 11, 14, 19

Palazzolo v. Rhode Island,
a Ara Se MD cetaiovinccsnscicneasscarniessdsasnanncineieiannanintenanes 11

Penn Central Transp. Co. v. New York,
GSE US. FOG CIF FE) oscccsneasncsesctnsssersans 6, 7, 8, 9,10, 11, 14

li

Pennsylvania Coal Co. v. Mahon,
BOD IS. FHS (1GTD) oecevversconsererinesenvecnes 1,2, 4, 5, 6, 7, 10

Planned Parenthood v. Casey,
PF ED LOD hccvosccnneimetsdicledtoteus ac. 3, 19

Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional

Planning Agency,
DPD Utes Dy DANAE COED vivcsnnrnninsnszirasaneedct 8

ill

ieee eit iain,

National Association of Home Builders respectfully
submits this brief amicus curiae in support of the petition for
certiorari filed by Petitioners Ester and Ronald Emmerman
on August 19, 2004.!

I. SUMMARY OF ARGUMENT

The case below presents the Court with an opportunity
to clarify an open question in its takings jurisprudence: how
should lower courts define the relevant parcel of land for the
purpose of determining whether a government regulation has
effected a compensable regulatory taking under the Fifth
Amendment. Given the confusion and conflicting views of
this question in the lower courts, the Court should grant the
petition to clarify the manner in which courts should
determine the relevant parcel.

Il. ARGUMENT

In 1992, this Court confronted a landmark property
case and held that a South Carolina beachfront building
restriction amounted to a compensable regulatory taking.
Lucas v. South Carolina Coastal Council, 505 U.S. 1003
(1992). Although the owner of land retained title, the Court
recognized that the “regulation denie[d] all economically
beneficial or productive use of the land,” amounting to the
functional equivalent of a physical taking. Jd. at 1015. This
principle was based upon Justice Holmes’ oft-quoted
assertion that “while property may be regulated to a certain
extent, if the regulation goes too far it will be recognized as a

' In accordance with Rule 37.6, Amicus Curiae confirms that this
brief was not written by counsel for any party in this matter and
that no person or entity made a monetary contribution specifically
for the preparation of this brief.

taking.” Pennsylvania Coal Co. v. Mahon, 260 U.S. 393,
415 (1922). The Lucas Court recognized that “[its] decision
in Mahon offered little insight into when, and under what
circumstances, a given regulation would be seen as going
‘too far,” Lucas, 505 U.S. at 1015, but it did not need to
provide a more precise definition because the trial court
found that the regulation in question “left each of Lucas’
beachfront lots without economic value.” Jd. at 1016 n.7.
The Court held that “on numerous occasions” its decisions
had established that “categorical treatment [is] appropriate
. where regulation denies all economically beneficial or
productive use of land.” Jd. at 1015-16 (emphasis added).

A. The Relevant Parcel Issue

At the same time, the Lucas Court admitted that “the
rhetorical force of our ‘deprivation of all economically
feasible use’ rule is greater than its precision, since the rule
does not make clear the ‘property interest’ against which the
loss of value is to be measured.” Jd. at 1016 n.7. Indeed,
this “relevant parcel” question is a crucial threshold issue for
all takings analyses, but it has received little judicial
attention in comparison to the question of how a regulation
affects the economic uses of a parcel. The relevant parcel is
the denominator in the takings fraction, so any comparison
of before and after values necessarily hinges on a uniform
method of determining the relevant parcel. Otherwise, the
court finds itself in the same position as a grade school child
trying to add fractions with different deneminators: without a
common denominator, the calculation is impossible. As the
Lucas Court recognized, however, the relevant parcel issue
remains “unclear.” Jd. Indeed, “this uncertainty regarding
the composition of the denominator in our ‘deprivation’
fraction has produced inconsistent pronouncements by the
Court,” further muddying the water. Jd.

The Lucas Court was able to sidestep the relevant
parcel question because it was irrelevant to the disposition of
that case: the numerator was zero (because the regulation
denied all economically viable use), so the value of the
takings fraction was the same regardless of the denominator.
Still, the issue looms large, and each passing year sees
greater conflict in takings jurisprudence as lower courts
struggle to make sense of contradictory precedent from this
Court. These courts have criticized Lucas not for its holding
but because this Court missed “a much-heralded opportunity
to clarify how courts were to balance public interest claims
against liberty claims of private property owners...”
Loveladies Harbor, Inc. v. United States, 28 F.3d 1171, 1178
(Fed. Cir. 1994); see also District Intown Properties Ltd.
P'ship v. District of Columbia, 198 F.3d 874, 887-888 (D.C.
Cir. 1999) (Williams, J., concurring).

To protect and preserve property rights, “[s]tate and
federal courts as well as legislatures throughout the Union
must have guidance as they seek to address this subject in
conformance with the Constitution.” Planned Parenthood v.
Casey, 505 U.S. 833, 845 (1992). This case, by highlighting
the relevant parcel question, provides the Court with an ideal
Opportunity to answer the lower courts’ requests for
guidance and clarify a vexatious issue in property law. A
clear relevant parcel precedent would resolve conflict among
lower courts while advancing the interest of judicial
economy by giving litigants a dependable and reliable
Standard by which to judge their dispute. Therefore, this
Court should grant certiorari.

B. This Court’s Relevant Parcel Jurisprudence Has
Produced More Questions Than Answers

l. Conflicting Answers to the Relevant Parcel Question:
Mahon and Keystone

The first major regulatory taking case was Mahon, in
which Justice Holmes made his famous assertion that a
regulation that “goes too far” violates the Takings Clause.
260 U.S. at 415. In this case, the Pennsylvania Coal
Company appealed an injunction that prevented it from coal
mining that would have caused subsidence on the plaintiffs’
property. Although the plaintiffs owned only the surface
rights to the property, the Kohler Act in Pennsylvania
restricted the company’s ability to exercise its mining rights
under the property by requiring it to leave intact enough
subterranean support to keep the mines from collapsing and
causing subsidence on the surface. The company argued that
the Kohler Act as applied amounted to a taking of the coal
left in the ground as support, violating the Fifth
Amendment’s Takings Clause. Despite the “public interest”
furthered by the Kohler Act, the Court struck it down,
holding that “[t]o make it commercially impracticably to
mine certain coal has very nearly the same effect for
constitutional purposes as appropriating or destroying it.”
Id. at 414. Implicitly, then, the Court reached this decision
by defining the relevant parcel narrowly: the regulation was
invalid because it prohibited all economic use of the “certain
coal” that could not be mined, despite the fact that the
company could still mine other coal on its property.

Over half a century later, this Court considered an
almost-identical question, and it reached the opposite
conclusion. Keystone Bituminous Coal Ass'n _ v.
DeBenedictis, 480 U.S. 470 (1987). Quoting Justice
Holmes’ admission that “the question depends upon the

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particular facts,” Mahon, 260 U.S. at 413, the Keystone
Court ignored the logic of Mahon because now it was
“address[ing] a different set of particular facts’ ...”
Keystone, 480 U.S. at 474. Like Mahon, however, the
central issue in Keystone was whether a Pennsylvania law
requiring coal mining companies to leave enough support in
the ground to prevent subsidence was a regulatory taking.
Unlike Mahon, the Keystone Court found that no
compensable taking. This outcome depended entirely on the
Keystone Court’s definition of the relevant parcel:

The 27 million tons of coal [that must be left
in the ground as support] do not constitute a
separate segment of property for takings law
purposes. Many zoning ordinances place
limits on the property owner’s right to make
profitable use of some segments of his
property. ... There is no basis for treating the
less than 2% of petitioners’ coal as a separate

parcel of property.
Id. at 496-97.

Remarkably, the Court reached this determination
despite its recognition that “Pennsylvania property law is
apparently unique in regarding the support estate as a
separate interest in land that can be conveyed apart from
either the mineral estate or the surface estate.” Jd. at 497-98.
This would seem to strengthen the Mahon argument that
only the support estate should be considered the relevant
parcel, but the Court nevertheless chose to aggregate the
support and mineral estates and consider them together as
one relevant parcel. It explicitly refused to let “the result
turn on whether state law allowed the separate sale of the
segment(s] of property.” Jd. at 498.

In dissent, Chief Justice Rehnquist criticized this
approach. He underlined the contradictions between the
Keystone majority opinion and the Mahon decision, rejecting
the majority’s insistence that the particular facts in Keystone
justified the dramatically different result. See id. at 518-520
(Rehnquist, C. J., dissenting). Although he acknowledged
that defining the relevant parcel was an “admittedly difficult
task,” id. at 514, the Chief Justice insisted that traditionally
the Court “evaluated takings claims by reference to the units
of property defined by state law.” Jd. at 518-19. Under his
reading of the Court’s precedent, “where the estate defined
by state law is both severable and of value in its own right, it
is appropriate to consider the effect of regulation on that
particular property interest.” Jd. at 520. Therefore, Chief
Justice Rehnquist advocated defining the relevant parcel
narrowly, as the Mahon Court had done, and finding that a

compensable taking had occurred.
2. Making Sense of the Contradiction: Penn Central and
Andrus

Although the factual similarities between Keystone
and Mahon highlight this Court’s divergent approaches to
the relevant parcel question, what is most notable about the
decisions is that the Keystone Court took great care to
reaffirm Mahon and cast its decision squarely within the
Mahon precedent. Jd. at 474. Both approaches remain good
law, and lower courts are left to decide whether to define
_ relevant parcel broadly (as in Keystone) or narrowly (as in
Mahon) by attempting to divine the factual differences cited,
but not enumerated, by the Keystone Court.

Indeed, Keystone may best be read as the logical
extension of another regulatory takings case, Penn Central
Transp. Co. v. New York, 438 U.S. 104 (1978), rather than as
a member of the Mahon family. Penn Central involved an

0 ee

effort to erect a 55-story tower on top of New York City’s
Grand Central Terminal, which the City had designated a
protected historic landmark. Penn Central, the owner of the
property, sued the City when the Landmarks Preservation
Commission denied permission to build the tower. The
railroad alleged that the ruling deprived it of the use of its air
rights without compensation, violating the Takings Clause.

The Court rejected this approach for several reasons,
one of which was its definition of the relevant parcel.
According to the majority:

“Taking” jurisprudence does not divide a
single parcel into discrete segments and
attempt to determine whether rights in a
particular segment have been entirely
abrogated....[T]his Court focuses rather both
on the character of the action and on the
nature and extent of the interference with
rights in the parcel as a whole — here, the city
tax block designated as the “landmark site.”

Id. at 130-31. It reconciled this broad relevant parcel
determination with Mahon by denying “that full use of air
rights is so bound up with the investment-backed
expectations of appellants that governmental deprivation of
these rights invariably ... constitutes a ‘taking.’” Jd. at 131
n.27.

In so doing, the Court recast the Mahon Court’s
definition of relevant parcel. Although Justice Holmes
explicitly noted that his decision was based on the fact that
the regulation made it “commercially impracticable to mine
certain coal,” Mahon, 260 U.S. at 414 (emphasis added), the
Penn Central majority believed the decision was really based
on the coal company’s expectation that it was buying rights
that could be completely exploited, causing it to pay a higher

7

investment price than it would have paid if the restriction
had been in effect at the time of purchase. Indeed, the Penn
Central Court asserted that Mahon was decided “irrespective
of the impact of the restriction on the value of the parcel as a
whole,” thereby implying that the Mahon Court never
decided the relevant parcel question at all. Penn Central,
438 U.S. at 131 n.27.

Regardless of how Penn Central characterized
Mahon, future courts seized on Penn Central’s sweeping
rejection of efforts to “divide a single parcel into discrete
segments” as the central lesson of the case. See, e.g., Tahoe-
Sierra Preservation Council, Inc. v. Tahoe Regional
Planning Agency, 535 U.S. 302, 326-27 (2002) (“Penn
Central did, however, make it clear that even though
multiple factors are relevant in the analysis of regulatory
takings claims, in such cases we must focus on ‘the parcel as
a whole’.”). However, as Chief Justice Rehnquist later
pointed out, “[t]he Court [in Penn Central] gave no guidance
on how one is to distinguish a ‘discrete segment’ from a
‘single parcel.’” Keystone, 480 U.S. at 517 n.5 (Rehnquist,
C. J., dissenting). In effect, then, the anti-severance principle
from Penn Central is superfluous; of course the Court will
not divide the relevant parcel, but the court still must
determine what the relevant parcel is.

The year after Penn Central, the Court had the
opportunity to clarify its relevant parcel ruling and instead
added more confusion to the jurisprudence. In Andrus v.
Allard, 444 U.S. 51 (1979), the Supreme Court addressed a
challenge to wildlife protection statutes that prevented the
sale and trade of some Native American artifacts because
they included feathers from protected eagles killed long
before the statutes were enacted. Dealers in the artifacts
challenged the law, arguing that the regulation deprived their

property of its value by preventing its sale and trade. The
Court disagreed:

The regulations challenged here do not
compel the surrender of the artifacts, and
there is no physical invasion or restraint upon
them. Rather, a significant restriction has
been imposed on one means of disposing of
the artifacts. But the denial of one traditional
property right does not always amount to a
taking. At least where an owner possesses a
full ‘bundle’ of property rights, the
destruction of one ‘strand’ of the bundle is
not a taking, because the aggregate must be
viewed in its entirety.

Id. at 65-66. Therefore, although it is “undeniable that the
regulations here prevented the most profitable use of
appellees’ property,” the property was not taken because the
regulations did not remove all sticks from the bundle; “for
example, [the dealers] might exhibit the artifacts for an
admissions charge.” Jd at 66. The relevant parcel, it
seemed, was every possible use of the property at issue, and
as long as any potential use remained, the Court would not
find that the regulation had “gone too far.”

Perhaps, then, Keystone can only be understood in
the context of Penn Central and Andrus. F ollowing on the
heels of the strong language in those cases, it stands to
reason that the Court would focus on the profitable uses of
the coal company’s property that remained in their bundle
rather than the sticks that could no longer be exploited. But
the Keystone Court took this analysis a step further, not only
considering the bundle of property rights in the support
estate but also aggregating that (empty) bundle with the (full)
bundle of rights in the mineral estate.

Lower courts have read this progression as evidence
of a presumption of aggregation, which “tends to reduce the
likelihood that courts will order compensation.” District
Intown, 198 F.3d at 885 (Williams, J., concurring). The
danger of such a presumption is that it will eventually butt
heads with the Takings Clause if it is not carefully applied.
As the Penn Central Court recognized, “the ‘Fifth
Amendment’s guarantee ... [is] designed to bar Government
from forcing some people alone to bear public burdens
which, in all fairness and justice, should be borne by the
public as a whole’.” 438 U.S. at 123 (quoting Armstrong v.
United States, 364 U.S. 40, 49 (1960)). Setting the
presumption too strongly against compensation undermines
this purpose by sacrificing “fairness and justice” for judicial
simplicity.

cH Another Change in Jurisprudence: Lucas and
Palazzolo

Recognizing the danger of defining relevant parcel
too broadly, the Lucas Court signaled, in dictum, a retreat
from Penn Central’s strong endorsement of aggregation.
After noting the confusion produced by its relevant parcel
jurisprudence, the Court turned its sights to Penn Central’s
“extreme — and, we think, unsupportable — view of the
relevant calculus.” Lucas, 505 U.S. at 1016 n.7. Again in
dictum, the Court moved toward the approach Chief Justice
Rehnquist advocated in his Keystone dissent, writing that
“the answer to this difficult question [i.e., relevant parcel]
may lie in ... whether and to what degree the State’s law has
accorded legal recognition and protection to the particular
interest in land with respect to which the takings claimant
alleges a diminution in (or elimination of) value.” Jd.
(emphasis added). Unfortunately, this retreat did takings
jurisprudence more harm than good, both because it was
signaled in dictum and because it was poorly defined. As

10

Judge Williams of the D.C. Circuit lamented, although “(t]he
Court arguably evidenced a retreat from this strong position
[taken in Penn Central] ... [it] has not, however, reached
agreement on the scope of this retreat.” District Intown, 198
F.3d at 887-88 (Williams, J., concurring).

Therefore, although the Court has come almost full
circle — from Mahon to Keystone and Penn Central and back
to a Mahon-like, narrow definition of relevant parcel in
Lucas — lower courts are not sure where exactly on the circle
Lucas left them. Indeed, this Court in Palazzolo v. Rhode
Island, 533 U.S. 606 (2001), indicated that it, too, was
unsure of the proper relevant parcel definition after Lucas.
Although the Palazzolo Court avoided the relevant parcel
issue because of procedural matters, in its brief discussion of
“the difficult, persisting question of what is the proper
denominator in the takings fraction,” the Court recognized
the contradictions that developed in its own jurisprudence
following Penn Central: “Some of our cases indicate that the
extent of the deprivation effected by a regulatory action is
measured against the value of the parcel as a whole, but we
have at times expressed discomfort with the logic of this
tule.” Palazzolo, 533 U.S. at 631 (citations omitted). If this
Court cannot decide how to interpret its own decisions, it is
no surprise that lower courts have encountered great
difficulty — as well as vastly different results — in their
attempts to do so.

c. Confusion in This Court’s Relevant Parcel
Jurisprudence Has Caused a Circuit Split

Barely two years after Lucas, the Federal Circuit
Court of Appeals was invited to try to make sense out of this
Court’s relevant parcel jurisprudence in Loveladies. 28 F.3d
1171 (Fed. Cir. 1994). In 1958, Loveladies purchased 250
acres of land located on Long Beach Island, Ocean County,

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New Jersey. /d. at 1174. In 1972, the passage of the Clean
Water Act brought 51 of those acres — which were wetlands
that had yet to be developed — under the control of the Army
Corps of Engineers. Jd. Loveladies also needed permission
from the New Jersey Department of Environmental
Protection to fill 50 of those acres (one had been filled prior
to 1972), and it eventually secured permission from the state
to develop 12.5 of the 51 acres. Jd. Since one of those acres
was already filled, the agreement with the state allowed
Loveladies to fill 11.5 acres. Jd.

Loveladies then applied for permission from the
Army Corps of Engineers to implement the agreement it had
reached with the state. Jd The Corps denied Loveladies’
application, and the company brought suit for a regulatory
taking in the Court of Federal Claims. Jd. The court ruled in
Loveladies’ favor, finding that there was a taking because
the permit denial caused “greater than 99% diminution of
[the land’s] value.” Jd. at 1175. The Government appealed.

The Court of Appeals began its consideration of the
case by framing the question it thought was presented: “The
question at issue here is, when the Government fulfills its
obligation to preserve and protect the public interest, may the
cost of obtaining that public benefit fall solely upon the
affected property owner, or is it to be shared by the
community at large.” Jd The court acknowledged that its
answer to that question hinged on two aspects of “the
Denominator Problem.” Jd. at 1179. First, the court needed
to determine “whether a regulatory taking requires that there
be a denial of essentially a//] remaining economic use, or
whether loss of a substantial part, but not all, of the
economic use may constitute a compensable taking.” Jd. In
other words, the court needed to decide how many sticks
may be taken from the Andrus bundle before a taking occurs.
The precedent, however, was far from clear: “The earlier

12

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cases sometimes use language suggesting that [all economic
use must be lost], and sometimes did [sic] not. Lucas itself
contains a discussion that acknowledges both viewpoints.”
Id. at 1179-80.

Recognizing that the answer to the first question
necessarily turned on the relevant parcel issue, the court then
turned to that “key question.” Jd. at 1180. The facts of the
case gave the court the choice of many potential relevant
parcels. The government argued that the relevant parcel was
either the original 250 acres or, alternatively, the 51 acres
that remained undeveloped when the ‘permit was denied.
Loveladies, on the other hand, argued that 38.5 of the 51
acres were “dedicated to the state in return for the NJDEP
permit,” so they should not be considered part of the relevant
parcel. Jd.

The Court of Appeals agreed with Loveladies. It
affirmed the lower court’s determination that the relevant
parcel was only the 12.5 acres that could have been
developed under the state agreement but were rendered
useless by the federal permit denial. Excluding the
contiguous 38.5 acres, although they were part of the original
parcel purchased by Loveladies, was “only logical since
whatever substantial value that land had now belongs to the
State and not to Loveladies.” /d. at 1181. Using this narrow
definition of the relevant parcel, the court returned to the first
question it had posed. It held:

This is not, then, a case of a partial taking,
involving linedrawing between
noncompensable ‘mere diminution’ and
compensable partial taking. Rather, this is a
case in which the owner of the relevant
parcel was deprived of all economically
feasible use.

13

Id. at 1181-82 (citations omitted). Therefore, the court ruled
that Loveladies was entitled to compensation.

Five years later, the D.C. Circuit Court of Appeals
was confronted with a similar issue, and it reached a very
different conclusion. In District Intown, 198 F.3d 874, the
court heard a suit alleging that the District had effected a
regulatory taking by denying building permits on lots that
had recently been designated historic landmarks. In 1961,
District Intown purchased an apartment building and
adjacent landscaped lawns in a single transaction. /d. at 877.
Twenty-seven years later, in 1988, District Intown
subdivided the property into nine lots; one lot contained the
apartment building, and the other eight were lawn lots on
which District Intown planned to build townhouses. Jd. The
following year, the District of Columbia designated all nine
lots historic landmarks, bringing them under the control of
the Historic Preservation Review Board. Jd. The Board then
denied building permit applications by District Intown in
1991 and 1992 because “construction on the lawn would be
incompatible with its historic landmark status.” Jd. at 878.
District Intown filed suit in federal court, alleging an
uncompensated regulatory taking, and it appealed a summary
judgment entered against it.

On appeal, the court recognized that “[uJnder both
Lucas and Penn Central ... we must first define what
constitutes the relevant parcel before we can evaluate the
regulation’s effect on that parcel.” Jd. at 880. This question,
in turn, boiled down to whether the lot containing the
apartment building should be considered part of the relevant
parcel. If not, the unbuildable lawn lots would have suffered
an almost complete diminution in value. If so, however, the
nine-lot parcel would retain significant value because of the
apartment building.

14

The court held that all nine lots together formed the
relevant parcel. Jd. at 877. It reached this decision by
inquiring “how both the property owner and the government
treat (and have treated) the property,” id at 880, and it
endorsed a four-factor analysis of the issue. The district
court had considered “the degree of contiguity, the dates of
acquisition, the extent to which the parcel has been treated as
a single unit, and the extent to which the restricted lots
benefit the unregulated lot,” and it found that all four
weighed in favor of treating the nine lots as one unit. Jd
(citing Ciampitti v. United States, 22 Cl. Ct. 310, 318 (Ci. Ct.
1991)). Aside from “[t]he intentional act of subdivision,”
neither court found any evidence that the property was
treated separately by the company in acquiring, maintaining
and managing it. Jd Therefore, the Court of Appeals
affirmed the decision to treat all nine lots as one relevant
parcel, and it likewise affirmed the ruling that there was no
compensable taking.

The fact that the courts reached different outcomes in
District Intown and Loveladies is not troubling in itself
because the Supreme Court has repeatedly recognized that
takings cases require “essentially ad-hoc, factual inquiries.”
Keystone, 480 U.S. at 495. Still, the lower courts’
discussions of the relevant parcel issue reveal vastly different
understandings of the state of the law. This leaves open the
distinct possibility that both cases would have come out
differently if they had been litigated in the other court. For
example, the District Intown court justified treating all nine
lots as one parcel on the following grounds:

The lots are spacially and functionally
contiguous. District Intown purchased the
property as a whole in 1961 and treated it as
a single indivisible property for more than
25 years. District Intown presented no

15

evidence that, even after subdivision, it
treated the lawn lots separately from Lot
106, the lot that contains the apartment
building...

District Intown, 198 F.3d at 880. However, the same can be
said of the property in Loveladies: the land at issue was
“spacially and functionally contiguous,” purchased together,
and managed jointly for more than 25 years. The only
difference between any of the lots in the 250 acres was that
some of them were filled and sold before the Clean Water
Act was passed and others were not. Similarly, one of the
nine District Intown lots was developed before the parcel
was designated a historic landmark, while the others were
not. The Loveladies court conceptually severed the lots
based on when they were developed, but the District Intown
court found that factor irrelevant.

Therefore, it appears that the District Intown court
ignored the factors that underlay the Loveladies decision, and
the Loveladies court discounted the considerations that
underpinned District Intown. This conflict in the circuits
will not resolve itself, and it is up to this Court to articulate a
clear theory to guide all the circuits in their relevant parcel
jurisprudence.

D. Federal Trial Courts Are Also Confused By the
Relevant Parcel Issue

Not surprisingly, the uncertainty about the relevant
parcel evident in the opinions of the Supreme Court and
Courts of Appeals has been magnified as lower courts have
struggled with the same issues. Two cases should be
sufficient to illustrate this point. Both cases considered
allegations of regulatory takings after permit denials by the
Army Corps of Engineers. Both were decided in the late
1990s by the same court, the United States Court of Federal

16

Claims. Despite these similarities, the outcomes of the cases
were very different.

In 1997, the court decided Forest Properties, Inc. v.
Big Bear Municipal Water District. 39 Fed. Cl. 56 (Fed. Cl.
1997). That case involved the denial of a dredge and fill
permit for 9.4 acres of lakebottom property adjoining 53
upland acres under the same ownership. Although the court
cited the same four factors later cited by the Federal Circuit
in District Intown, it discounted evidence of “the different
dates upon which the upland property was acquired and the
option rights [to purchase the lakebottom property] were
transferred, the separate consideration that was paid for the
upland property, and the option rights.” Forest Properties,
39 Fed. Cl. at 73. Indeed, it observed that “[t]his court must
be wary of focusing solely on the particular facts of a
transaction.” Jd. The court, instead, “should focus on how
the economic expectations of the claimant, with respect to
the parcel at issue, have shaped the owner’s actual and
projected use of the property.” Jd In the end, the court
found that “FPI’s economic intentions were to utilize the
lakebottom acreage and the upland parcel in conjunction
with each other as one income-producing unit.” Jd. at 74.
Therefore, it chose to treat all 62 acres as the relevant parcel,
and it found that the permit denial caused a mere diminution
in value, not a compensable taking.

Two years later, the court was again invited to
address an alleged regulatory taking. Florida Rock
Industries, Inc. v. United States, 45 Fed. Cl. 21 (Fed. Cl.
1999). This time, the Corps denied a permit to mine
limestone on land Florida Rock had purchased for that
purpose just before the Clean Water Act Amendments
passed in 1972. First, Florida Rock applied for a permit to
mine the entire 1,560 acre parcel, and this application was
denied because “the Corps indicated it would only consider

17

applications covering mining needs sufficient to satisfy a
three year period.” Jd. at 25. Then, Florida Rock again
applied for a mining permit, this time only for the 98 acres it
could mine in three years. This application was also denied.
Id.

In considering Florida Rock’s taking claim, the Court
of Federal Claims determined that the relevant parcel was the
98 acres for which the permit had been denied. Jd. at 33. It
refused to entertain the notion that Florida Rock’s inability to
mine 6 percent of its wholly-owned contiguous property
merely diminished the value of the entire lot. Instead, the
court observed that “[rjegulations often require courts to
look at entire parcels to determine their impact, but that does
not mean property only exists in the form of the entire
parcel.” Jd. at 43. Finding that “[t]he frustration of Florida
Rock’s reasonable investment-backed expectations is beyond
doubt ... [and] absolute,” the court ruled that the 98 acres at
issue had been taken by regulation and Florida Rock was
entitled to just compensation. /d. at 41.

It is difficult to square this decision with Forest
Properties. The court in Florida Rock was willing to sever
98 wetland acres from 1,462 contiguous and
indistinguishable wetland acres owned by the same company
and intended for the same purpose, but the Forest Properties
court refused to sever 9.4 lakebottom acres from 53 upland
acres that were purchased separately. Both Florida Rock and
Forest Properties purchased the land in question as an
investment with expectations that it could be exploited
profitably. Both saw their expectations frustrated by the
denial of federal permits. Only one received compensation.
The confusion and contradiction in the relevant parcel
jurisprudence evidenced by these two opinions is
representative of the struggle faced by lower courts
nationwide in trying to make sense of the “partial theories

18

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and broken concepts” that litter “the landscape of taking
law.” Florida Rock, 45 Fed. Cl. at 23.

Il. CONCLUSION

The same year that Lucas was decided, this Court
famously remarked that “[l]iberty finds no refuge in a
jurisprudence of doubt.” Casey, 505 U.S. at 844. This Court
should grant the Emmermans’ petition for certiorari to
clarify the difficult issue of relevant parcel for litigants and
courts across the country.

DATED: October, 2004.

Respectfully submitted,

DUANE J. DESIDERIO DWIGHT H. MERRIAM*

Of Counsel *Counsel of Record

National Association of PATRICK J. SWEENEY

Home Builders Of Counsel

1201 15" Street, NW Robinson & Cole, LLP

Washington, DC 20005_ 280 Trumbull Street

Telephone: (202) 266-8200 Hartford, Connecticut 06103

Facsimile: (202) 266-8161 Telephone: (860) 275-8200

Facsimile: (860) 275-8299

Counsel for Amicus Curiae National Association of Home Builders

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386008_1019%3A4. Public record. Not legal advice.