Local Governments, Developers and Property Owners Be Advised– The United States Supreme Court Has Just Changed Long-Standing Law On Takings

July 12, 2019
Posted in Litigation
Local Governments, Developers and Property Owners Be Advised– The United States Supreme Court Has Just Changed Long-Standing Law On Takings

A recent United States Supreme Court decision (June, 2019) in a case regarding a family graveyard in a small town north of Scranton, Pennsylvania has resulted in a significant shift in the law on takings, which is an area of law that addresses situations when a government (federal, state or local) seizes, infringes on or limits the use of private property.

This case involves a township ordinance requiring that all cemeteries be kept open and accessible to the general public during daylight hours. Rose Mary Knick, whose rural property has a small family graveyard, was informed by the township that she was violating the aforementioned ordinance. In response, Ms. Knick sought declaratory and injunctive judicial relief in state court on the ground that the ordinance constituted a taking of her property; however, in her action, she did not seek monetary compensation for the alleged taking.  The township withdrew the violation notice and stayed enforcement of the ordinance; therefore, Ms. Knick could not meet the requirements for equitable relief, and the state court did not rule on her request.  Ms. Knick subsequently filed an action in federal District Court, alleging that the ordinance violated the Takings Clause of the Fifth Amendment to the United States Constitution, which states that “private property [shall not] be taken for public use, without just compensation.”  The District Court dismissed Ms. Knick’s claim, relying on a prior Supreme Court case, which held that a property owner whose property was taken by a local government had not suffered a violation of its Fifth Amendment rights (and, therefore, could not bring a takings claim in federal court) until a state court denied a claim for just compensation under state law. The Third Circuit Court of Appeals affirmed the District Court ruling and Ms. Knick sought review by the Supreme Court.

The primary issue before the Supreme Court in this case is whether, under takings law,  property owners must seek just compensation in state court, under state law, before bringing a federal takings claim in federal court. Here, the Supreme Court noted the “catch-22” situation that a plaintiff in a takings situation faces:  the plaintiff cannot proceed to federal court without first going to state court.  However, if the plaintiff brings its claim in state court and loses, its claim is barred in federal court because a state court resolution of a takings claim for just compensation under state law generally has a preclusive effect in a subsequent federal case.

In a 5-4 decision, with Chief Justice John Roberts authoring the majority opinion, the Supreme Court overruled its prior decision that takings claims must be brought in state courts, and held “that the state-litigation requirement imposes an unjustifiable burden on takins plaintiffs,” and that a “property owner that has suffered a violation of his Fifth Amendment rights when the government takes his property without just compensation,” may bring a claim in federal court at that time.

The United States Supreme Court’s decision in this case is especially noteworthy to property owners, land developers and local governments, all of which may be parties in takings litigation.  The effect of the decision appears to open up the full judicial landscape – including federal courts – to claims for just compensation when a government “takes” private property for a public use.

For more information, please e-mail or call Steven A. Hann at SHann@hrmml.com or 215-661-0400.

Featured Posts

Subscribe

Practice Area Topics

Search