O People S Rights Come Only Through the Government

PROPERTY OUTLINE (Updated 4/18/2009)

·  PHILOSOPHY

o  “People’s rights come only through the government.”

§  Hobbes = legal positivism

·  Man is innately brutish and mean à absolute power should go to sovereign à men should be sanctioned if they disobey sovereign

§  Bentham = utilitarianism

·  Law is only good if it makes the majority happy.

·  Voting ensures those with policies that make us happy are in office.

·  Utilitarian Theory of Property:

o  Idea is that a primary function of property rights is to promote the efficient use of resources. Is also a means of distributing and redistributing wealth of a society.

§  Austin = IS v. OUGHT

·  Law = IS = command of the sovereign, set by judges (from Hobbes)

·  Legislation = OUGHT = set by legislature (from Bentham)

o  “Natural Rights” - Locke

§  Natural rights = life, liberty and property

§  State has limited power to protect the people’s natural rights

§  CONSTITUTION IS FOUNDED ON LOCKE VIEW (Bill of Rights limits power of government, reserves power for the states/the people – 14th Amendment)

·  Note: Supreme Court views break down based on natural rights

o  Left: natural rights don’t need to be enumerated in the Constitution for people to have them (ex. right to privacy is a natural right)

o  Right: natural rights are enumerated in the Constitution.

o  Critical Legal Thinkers

§  Law = Politics = Not Natural, Rigged to favor interests of the rich

o  Law & Economics/Market

§  Asks what is efficient – what is best for society?

·  Pareto – allocation of resources is efficient if it makes at least one person better off and no one worse off.

·  “Rational Maximizer” – every person is rational and tries to maximize utility

·  Kaldor-Hicks – if there is a net overall gain, then the action is good

§  Adam Smith – Capitalism

·  “Free Market” Economy may look chaotic, but it is actually guided by an invisible hand.

·  When the individual pursues his self-interest, he is promoting the good of society more than if he acts with the sole intention to benefit society à so self-interested competition in the free market is good for society, because it keeps prices low and still builds an incentive for manufacturing/introducing goods and services.

·  Value of good = cost of acquiring it (effort to earn money to buy it)

o  Cognitive Science – George Lecock

§  Physical realities come from our personal perceptions and the resulting schemas in our brains – our background shapes how we define things… if we encounter something new, we will try to fit in into existing schemas.

§  Politics:

·  Conservative/Republican = Strict Father

o  Favors authority, obedience, punishment, responsibility and independence

·  Liberal/Democrat = Nurturing Parent

o  Favors democracy, negotiation, compassion and COMMUNITY

·  EXTERNALITIES

o  Exist whenever some person makes a decision about how to use resources without taking full account of the effects of the decision. They ignore some of the effects because they would fall on others.

o  Externalities cause incentives to take a free ride – persons may reason that no contribution to a group payment is necessary because the contributions of others will be enough, so the free rider benefits at no cost.

·  Basic Property Ownership – Types

o  Communal Ownership = rights that can be exercised by all members of the community.

§  Means that no one individual can interfere with any person’s exercise of communally owned rights.

§  Results in great externalities – the full costs of the activities of an owner of communal property are not borne directly by him.

o  Private Ownership = the community recognizes the right of the owner to exclude others from exercising the owner’s private rights.

§  If a single person owns land, he will attempt to maximize its present value, acting like a broker.

§  Private ownership results in the internalization of costs.

o  State ownership = the state may exclude anyone from the use of a right as long as they follow accepted procedures for doing so.

·  DESCRIPTIONS OF PROPERTY – BASIC TYPES

o  Description by Government Survey

§  At formation of US – all public land was surveyed into rectangular tracts by running parallel lines north and south (range lines) and crossing them at approximately right angles with other parallel lines running east and west (township lines) to form rectangles six miles square. These six mile tracts are townships. Each township was surveyed into 36 tracts (sections), each one square mile and containing apx. 640 acres.

·  “TAKINGS” CLAUSE (Eminent Domain)

o  Eminent domain

§  = the power of the government to force transfers of property from owners to itself

§  Arguments for:

·  Economic argument – necessary to prevent monopoly (where high transaction costs exist for purchasers) – allows shifting of resources

o  Power of Eminent Domain comes from 5TH AMENDMENT, US Constitution – “Nor shall private property be taken for PUBLIC USE, without JUST COMPENSATION” and 14th Amendment (due process application to state)

§  Note: limits government’s right to take property AND freedom to regulate

o  Inverse Condemnation Action – claimant rather than government initiates the suit, alleging that a taking has occurred and seeking compensation.

o  “TAKINGS” ANALYSIS:

§  Can the government do it (5th Amendment)?

·  Yes, if the action is CAUSALLY RELATED to a CONCIEVABLE PUBLIC PURPOSE. (Berman and Midkiff)

·  If not, then stop analysis, and government cannot do the action.

o  note: federal test – individual states may have stricter test

o  PUBLIC USE = CONCIEVABLE PUBLIC PURPOSE

§  Main question: What does “public use” mean?

·  Two different views

o  Advantage/benefit to the public (broad view) OR

§  Taking’s PURPOSE, not MECHANICS matters. (Midkiff)

§  End result of taking matters, but legislature is given deference in determining what public needs (may tie with police power) justify the use of the takings power. (KELO)

o  Actual use or right to use of the condemned property by the public (narrow view).

o  Tie between “Police Power” and “Takings” Clause in the 5th Amendment – how closely you believe they are connected determines what you think “public use” – is it for the land to be used by the public, or for the government to police the people?

§  Must government pay? (Has there been a taking?)

·  Note: What the government DID, not what they INTENDED matters.

·  A permanent physical occupation, no matter how inconsequential, authorized by the government, is a taking. This includes noise interference and other non-tangible occupations. (Loretto v. Teleprompter Manhatten CATV Corp.; US v. Causby)

·  If the regulation denies all economically beneficial or productive use of the land, there is a taking. (Lucas v. South Carolina Coastal Council)

·  If the government action is a NUISANCE CONTROL MEASURE/REGULATION (exercise of police power), then there is generally no taking. (Hadacheck v. Sebastian)

o  Note: Difference between eminent domain and police power (what is a nuisance control measure?):

§  Under the police power, the rights of property owners are impaired because their free exercise is believed to be detrimental to public interests.

§  Under eminent domain, property is taken because it is beneficial to the public, not harmful in its existing state.

§  Note: whether you view it as eliminating public harm or for the public good depends on how you frame the issue - SUBJECTIVE

·  If the regulation GOES TOO FAR, imposing too great a burden on property owners, it will be CONSIDERED A TAKING. This is a balancing test (Penn Coal v. Mahon)…

o  Considers EXTENT OF THE DIMINUTION IN VALUE of the property to the property owner caused by the regulation. (Penn Coal v. Mahon).

o  Considers the INVESTMENT BACKED EXPECTATIONS of the property owner and effect of government action on those expectations. (Penn Central Transport. Co. v. City of New York)

§  Note: Future generations can have “investment backed expectations” – “right to be compensated cannot be destroyed by a change of title” – purchase of title comes with right to bring inverse condemnation action. (Palazzolo v. Rhode Island)

o  Considers the AVERAGE RECIPROCITY OF ADVANTAGE to the landowner caused by the regulation. If this exists, it may not be considered a taking. (Penn Coal v. Mahon)

o  Considers the character of the regulation – if it GOES BEYOND COMMON LAW NUISANCE results that could be achieved in the state’s courts, it is a taking. (Lucas v. South Carolina Coastal Council)

o  Considers CONCEPTUAL SEVERANCE – focuses on the extent of the interference with rights in the parcel as a whole, the entire bundle of rights, both in physical space and time. (Penn Central Transport. Co. v. City of New York; Tahoe-Sierra Preservation Council v. Tahoe Regional Planning Agency)

§  What does compensation mean?

·  Compensation is FAIR MARKET VALUE, NOT personal value (US v. Miller)

o  FMV = price in cash for which the property would change hands in a transaction between a willing buyer and a willing seller.

·  If the government regulation is a taking, then the government must pay just compensation from the time the regulation first results in a taking until the time the government rescinds the regulation or changes it. Merely rescinding the regulation is not adequate – compensation must be given – INTERIM DAMAGES. (First English Evangelical Lutheran Church v. County of Los Angeles)

·  Is compensation efficient?

o  Yes, because it gives investors/purchasers security when purchasing

o  No, if it leads to overinvestment in capital by owners without regard for efficiency of government projects

·  Can “transferable development rights” count as compensation?

o  Possibly – can “ease the burden of regulation such that it would not amount to a taking”, but not clear. (Penn Central Transport. Co. v. City of New York)

o  EXACTIONS

§  Exaction = Local government measure that requires developers to provide goods and services or pay fees as a condition to getting project approval.

§  First ask, it is an exaction? (If not, use takings analysis).

§  If it is an exaction, can the government do it (is it constitutional)? – Two Step Analysis

·  There must be an ESSENTIAL NEXUS between the exaction and a CONCIEVABLE PUBLIC PURPOSE to be advanced for the exaction to be constitutional (Nollan v. California Coastal Commission).

·  If such a nexus exists, then must decide the degree of connection that exists between the exactions and the projected impact of the proposed development. (Dolan v. City of Tigard)

o  Must be a ROUGH PROPORTIONALITY between the exaction required and the development.

§  (focus on what exaction WOULD do, not COULD do)

o  No precise mathematical calculation is required, but the city must show that the required dedication is RELATED IN BOTH NATURE AND EXTENT to the impact of the proposed development.

o  This is like “average reciprocity of advantage”, as in Penn Coal – when has the exaction requirement gone too far? If the burden on the developer of the exaction is > the increased burdens caused by the developer’s development, then government has gone too far and it is a TAKING (so compensation must be given).

§  Supreme Court takes bifurcated approach to takings problem, with heightened scrutiny applied to exactions but deference to other regulatory acts facing takings challenges.

§  Community v. Individual Solution when the Government wants to control land use:

·  Community owns part of property, through easement (i.e. exaction/taking) OR

·  Individual owns the land, but the city can regulate its use.

·  But is this really different?

·  ZONING

o  Brief History:

§  Civil War to Beg. 20th Century – Courts were hesitant to declare anything a nuisance for fear of hindering development. When nuisance law was used, it did not prevent nuisances from arising, but just gave damages/injunction after the fact.

§  Ebenezer Howard/Garden Cities – Howard proposed separating land uses. At core of scheme was wholesome housing, defined in terms of suburban/ small-town qualities. Utilitarian based idea.

§  American planners took the following principles from Howard’s ideal community:

·  Separation of uses;

·  Protection of single-family homes;

·  Low rise development; and

·  Medium-density population.

§  1916 – NY City enacted the first comprehensive zoning program, classifying uses into types and assigning them to zones and establishing restrictions on height of buildings.

§  1922 – Standard State zoning Enabling Act passed by Advisory Committee on Zoning appointed by President Hoover. Standard State Zoning Enabling Act:

·  Empowers municipalities to “regulate and restrict the height, number of stories, size of buildings/structures, % of lot that may be occupied, density, location and use of buildings, etc”… State gives power à municipality can zone

·  Permits the division of municipalities into districts (zones)

·  Zoning ordinances must be “made in accordance with a comprehensive plan” and designed to (do the above)

o  Comprehensive Plan = statement of the local government’s objectives and standards for development.

§  Problem with a static comprehensive plan – future may be unpredictable

o  2 step process: PLAN à ZONE from plan

§  Note: questionable whether steps have to be distinct, or if you can plan as you zone

·  Individual cities must create a Planning and Zoning Commission and a Board of Adjustment

o  Planning and Zoning Commission is LEGISLATIVE. Sets zoning ordinances in accordance with police power use, creating comprehensive plan.

o  Board of Adjustment

§  …is AJUDICATIVE, not legislative. Individual owners can appeal for variances/exceptions to Board.

§  Board must act under a statement of policy that acts as a guide “so that the determination of individual rights will not be left to the purely arbitrary discretion of the administration”

§  Must give procedural due process – standards set before adjudication, notice, hearing, unbiased decision makers, decision and reasoning articulated, ability to appeal

§  “Euclidian Zoning” – districts are graded from highest to lowest, and uses permitted in each district are cumulative.