This time last week, we were sitting in the North Carolina Supreme Court's (very beautiful) courtroom, above, having just observed oral arguments in a case we've been following for quite a while, Chappell v. NCDOT, No. 51PA19 (docket here).
This case is the follow up (after remand) of the N.C. Supreme Court's landmark decision in Kirby v. North Carolina Dep't of Transportation, No 56PA14-2 (June 10, 2016), in which the court held that the "Map Act," a statute by which DOT designated vast swaths of property for future highway acquisition, was a taking because the Act prohibited development and use of designated properties in the interim. The court concluded "[t]hese restraints, coupled with their indefinite nature, constitute a taking of plaintiffs’ elemental property rights by eminent domain." The court remanded the case for a parcel-by-parcel determination of just compensation. On remand, the trial court concluded the Chappell case was a permanent taking, and awarded compensation accordingly. DOT appealed, and here we are.
The biggest theoretical gap we witnessed in the arguments was that each of the parties seemed to have a different conception of exactly what "property" has been taken, and thus is being valued. On one hand, DOT argued that the Map Act's restrictions were like a negative easement, severely restricting the use of the property, but not totally wiping out all uses. Thus, DOT argued, the taking could not be valued as a "permanent" taking (and by "permanent," we think they meant taking of the fee, even though they never expressly argued that). The property owners, by contrast, argued that the court in Kirby held these takings were "indefinite" and therefore "permanent," because a decades-long restriction on economically beneficial uses is the equivalent of a permanent take.
A couple of thoughts. First, one thing we didn't hear argued in detail was the effect of the subsequent repeal of the Map Act. Immediately following the Kirby decision, the N.C. legislature repealed the statute, which in our view transformed the formerly "indefinite" takings into temporary takings, albeit very long-term takings. The advocates didn't focus on this question, and we heard only a couple of questions from the otherwise hot bench. To us, this is a critical issue, since in our view, the government always retains the authority to repeal a statute or regulation, and thus put an end date on a formerly indefinite taking. And as we all know, the U.S. Supreme Court held in First English Evangelical Lutheran Church v. Los Angeles County, 482 U.S. 304 (1987) that temporary takings are takings, and the owner is entitled to just compensation for the time which a statute or regulation "clouded" use. Here, that seems like a very long time for DOT to have, in effect, rented the property from the Chappells. But if that's how comp plays out, that's how it plays out.
Second, we're not sure if the record shows that DOT preserved its main argument by an offer of proof of the uses supposedly remaining under the Map Act "negative easement." If not, that seems like one way for the court to rule in favor of the property owners and affirm, without dealing with the temporary vs indefinite nature of the taking. If the owners are satisfied with being compensated for the fee taking in this proceeding and not seeking the rent-plus-interest, who are we to say otherwise, provided the court does not establish a (wrong) rule that these type of cases generally are valued as permanent fee takes.
One last thing before we go (and await the court's opinion). If you are in the neighborhood of the N.C. Supreme Court, you should drop in and pay a visit, even if there isn't a case on the docket that is in your alley. It's a historical building (surrounded by other similarly historical buildings), and the courtroom itself is impressive. Very impressive.
