Good afternoon, my name is Robert Thomas, and I'm a civil rights lawyer. A human rights lawyer. Because, as we all know, private property is a civil right -- importantly, for today's discussion -- a federal civil right.
And that is context which frames the subject of my portion of our panel today about "emerging issues" in property. I'll be focusing on recent trends in the courts, and then try to fit these cases into my internal "matrix,” in which property rights are on a continuum. From "property" rights, to private property rights, ranging from the "baseline" (also otherwise known as "common law," "natural law," "fundamental principles," Lockean, "normative" (and what would an academic conference be without at least a single use of the term "normative?), "Restatement," whatever you want to call it), to state-recognized and state-created property rights.
Fundamental Federal Property Rights
To me, the former is the most fascinating of the emerging issues, especially the Ninth Circuit decision which Professor Brady mentioned, in which the court concluded that the interest on state retirement accounts is not subject to a state court's redefining it out of existence, because interest is a "core" and "traditional" property right that the state could not disavow or define away. This was a very Blackstonian approach, one recognized by Justice Thurgood Marshall in his concurring opinion in PruneYard Shopping Center v. Robins, where he wrote:
I do not understand the Court to suggest that rights of property are to be defined solely by state law, or that there is no federal constitutional barrier to the abrogation of common law rights by Congress or a state government. The constitutional terms "life, liberty, and property" do not derive their meaning solely from the provisions of positive law. They have a normative dimension as well, establishing a sphere of private autonomy which government is bound to respect.
PruneYard, 447 U.S. 74, 93-94 (Marshall, J., concurring) (emphasis added). We have also seen more recently -- although less expressly -- in Murr v. Wisconsin, 137 S. Ct. 1933 (2017), where eight Justices rejected Wisconsin's argument that the state could define and redefine what counts as "property" with a totally free hand. After all, the majority in that case imposed a federal common law multi-factor test for the takings "denominator" (in reality, defining the property at issue). The dissenters also rejected Wisconsin's argument that it alone defined the parcel, concluding that even though state metes and bounds is the starting point in the parcel analysis, it isn't the only thing to look at.
In short are there "background principles of federal law" in the concept of property? (Like Justice Marshall, I think so.)
Thus, the fixation of the Supreme Court on an owner's expectations should mean little in the equation, and it seems to me like judges' judges expectations count for a whole lot more.
That's the first emerging issue, and the most important in my view.
State-Created or State-Recognized Property Rights
The second is that if there's a federal baseline, what about when a state recognizes more rights (not less) as "property?"
Before we get into that, a sidebar observation that I am not certain is all that important, but may be worth exploring. Is there anything to be made of the fact that the Fifth Amendment is the only provision in the constitution that refers to "private" property? The others such as the Due Process clauses of the Fifth and the Fourteenth Amendments, for example, only refer to "property” without the modifier "private."
Here's one recent example where the difference may make a difference.
In In re Maui Electric Co., Hawaii Supreme Court held that the Hawaii Constitution's provision guaranteeing a right to a "clean and healthful environment" is "property." But the District of Columbia Circuit held the opposite in a FERC case reviewing Pennsylvania's similar "clean air and pure water” constitutional provision, concluding it recognized "property," but that's not really "property." You can't sell it, you can't exclude others from it, nor is there any value you can place on it. Thus, to the court, it was not truly property, because it did not fall within the "traditional" concept of property. Thus, it was not due process property. Federal baselines anyone?
The provisions in the Hawaii and Pennsylvania constitutions guaranteeing a clean environment are state-created entitlements like the state job in Board of Regents v. Roth -- something someone has a "legitimate claim of entitlement" to. Like Kaiser Aetna's right to exclude the public from the pre-development fishpond. Cultural rights in the Hawaii telescope case referred to by Professor Callies earlier today, and the procedural rights in the Tenth Circuit's M.A.K. v. Glendale case, where the court concluded that the city's blight designation did not have a direct impact on property in the land (it was merely a designation), but the lack of notice of the blight designation did on the property owner's right to timely appeal the blight designation, the due process property being the state procedures themselves.
A Right to Have the State Protect Property?
The next emerging issue is whether there is a fundamental or baseline property right -- or a state-created property right -- to have the government act to protect your property? Professor Mulvaney has explored this in his recent work on Non-Enforcement Takings, and in the courts we see this played out in several recent interesting cases:
- The Federal Circuit's decision in the Mississippi River-Gulf Outlet case, in which the Court of Federal Claims held after trial that the United States had taken property belonging to Saint Bernard Parish because the Corps of Engineers constructed -- and then failed to maintain -- MRGO, such that when Hurricane Katrina hit, the channel amplified the storm's effects by serving as a bowling alley for the hurricane's force, with Saint Bernard Parish and the Ninth Ward as the pins. The CFC awarded a very large compensation verdict and the government appealed to the Federal Circuit. That court (any guess which judge?) reversed, concluding that as a matter of law, the federal government could never be liable for a taking caused by its inaction, thus adopting a categorical rule in a flood case even though the Supreme Court in Arkansas Game told the lower courts that it wasn't fond of categorical rules.
- We see a state court version of this going the other way in Maryland, where the court held that a local government's failure to enforce it septic tank regulations was the cause of flooding you-know-what onto a nearby campground. That was a taking, even though based on government inaction. This goes back to the distinction between takings and inverse condemnation on one hand, and government's tort liability for negligence on the other.
To me, these are the most critical "what is property" and what does it mean issues that we should be following.
Two Other Issues
Two other burgeoning issues ripe for clarification:
First, Just Compensation. It has been more than thirty years since the Supreme Court has given us a just compensation case, and it is not because the law of just compensation is remarkably clear.
Two competing threads in compensation law still have yet to be resolved. Whether the purpose of the Just Compensation Clause is to make an owner whole -- indemnity, the "the full and perfect equivalent of the property taken" -- or is it simply to pay for the fair market value of the land alone? We know what the answer should be (the former), but the courts just don't seem to want to get it.
Second, business losses associated with a taking. Same for the fees and costs the owner incurs in defense of her property rights, especially when the government has low-balled valuation.
One Last Thing: What The Hell is a "Taking?"
And I cannot leave the podium without asking the most fundamental question the Supreme Court has not resolved: what the hell is a taking? It's been nearly 100 years since the Court told us that an exercise of a power other than the eminent domain power can result in a taking, but it still is not sure what a cause of action looks like, most recently evidenced earlier this week in the Knick oral arguments, where it appeared that only two or three of the Justices even understand what an inverse condemnation or regulatory takings lawsuit means, and what property owners who raise these claims want. Most of the questions to counsel on Wednesday were scary because they reflected the Justices' wrong -- and in some cases, bizarre -- assumptions.
I don't see the Justices comparing apples and oranges, but rather they believe they are eating oranges when in fact they have tangerines. Thus, the biggest issue I see is that the majority of Supreme Court does not understand eminent domain law fundamentals. Lacking that analytical foundation, they end up operating under a set of often-wrong assumptions. Assuming, for example, that the inverse condemnation and regulatory takings tangerines are just like the eminent domain oranges they are used to biting into. I do not have a lot of confidence in the Court's ability to lead us out of the doctrinal wilderness -- or at least not make it worse -- after last Wednesday's Knick arguments.
But enough of doom and gloom -- please allow me to end on a more positive note: hearty congratulations to Professor Sterk for a well-earned Brigham-Kanner Property Rights Prize. Welcome to the pantheon of greats, Professor Sterk!
