U.S. Supreme Court limits rights of property owners

[DonViejo]

Source: Reuters



Fri Jun 23, 2017 | 10:12am EDT

By Andrew Chung | WASHINGTON, JUNE 23

The U.S. Supreme Court on Friday narrowed the rights of property owners in disputes with the government in a case involving a family's bid to sell a vacant lot in Wisconsin on the picturesque St. Croix River.

The justices, in a 5-3 ruling, upheld the use of zoning regulations by Wisconsin to prevent members of the Murr family from selling the lot because the family also owned an adjoining parcel of land.

The justices decided that government officials can combine separate parcels of private land in determining whether public officials have effectively taken private property through zoning laws and must pay compensation. The ruling could make it harder for property owners to prove compensation claims.

(Reporting by Andrew Chung; Editing by Will Dunham)

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Read more: http://www.reuters.com/article/usa-court-property-idUSL1N1J41D7

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Supreme Court limits rights of property owners
REUTERS
23 JUN 2017 AT 10:20 ET

-snip-

State and local governments nationwide are grappling with ways to manage urban sprawl, provide services to residents and protect the environment, often by limiting the use of private property and leading to litigation by landowners.

Courts have recognized that in some cases, regulation can go so far as to deprive the owner of the value of their property, requiring compensation by the government. The legal issue behind the Murr family’s case is how courts should make that call.

The dispute began in 2004 when four Murr family siblings, who own two adjacent parcels of land on the St. Croix River in Troy, Wisconsin, wanted to sell an empty lot. Citing zoning regulations, county officials told them it was too small to develop and they would have to sell it with the adjacent lot.

The Murrs sued, alleging that the government had effectively taken the land without compensation. Without the ability to sell or develop the lot, it had been rendered economically useless, they said.

A Wisconsin appeals court sided with the state and local county in 2014, saying officials had not deprived the family of their property because both lots were contiguous and could be sold or developed together.

-snip-

http://www.rawstory.com/2017/06/supreme-court-limits-rights-of-property-owners/

[Aristus]

1. Middle-class property owners, no doubt.

The Supreme Court will continue to give the rich assholes of America everything they want...

[7962]

2. But lot size restrictions are fairly common in the US.

Recently in my area, the county increased the lot size requirement for any home built with a septic tank. Developers scrambled to get their smaller lot subdivisions approved before the change!

[Ms. Toad]

3. That's not exactly the question here -

based on the blurb at the link.

The question is whether the regulation is a government taking (meaning the government is required to pay for what it took when it imposed new regulations on existing owners). If the government, after you already own property, rezones the property in a way that effectively makes your property worthless, it has to pay for the fact that its regulation took your property from you. (A regulatory taking is already much harder to prove than an actual taking - and this ruling makes it even harder on a very small group of owners of adjacent properties that are independently made worthless - but not made worse in the aggregate.)

The question here seems to be:

Party A owns both lots One (house lot) and Two (smaller adjacent vacant lot). In order to determine if the regulation took lot Two, the decision allowed the govenment to treat lots One and Two as if they were a single lot. Since the combined lot is within the new zoning regulation size, there was no taking. (Even though lot One is usable on its own and could be sold separately, and lot Two is now not).

Where this becomes particularly unfair is that if lot One was two doors down from lot Two, rather than next door, lot Two would still be worthless (since it is too small to be used under the new regulations), but you would be compensated for the regulatory taking because your two properties were separated by property owned by a different person, and could not be theoretically or actually merged.

[dbackjon]

4. The company that I work for owns a lot that is proving to be impossible to sell

Because of zoning requirements for parking, access, etc.

Should the company sue to allow a non-conforming use?

or because when the bought the entire lot, and only needed 3/4 for the building they needed, it was our own fault for creating the small parcel?

[cstanleytech]

7. In that situation the company might be well advised to simply deed it to the city or county

and let them deal with the headache if they cant really build on it due to it being to small or some other zoning limitation and write it off on their taxes if they can especially since they already made a profit I assume off the portion of the property that they did develop.

[Ms. Toad]

8. The latter.

This is a question of a zoning change that happened AFTER the acquisition of the land. You buy it after the zoning regulations are in effect, you're out of luck because you are on notice when you bought it (and should have taken into account all of the implications of the zoning when you negotiated your deal). It's a constitutional thing (5th amendment - no government taking without fair compensation). If you buy into the problem, the prior government action didn't take anything from you.

A regulatory government taking is very rare - and only arises when later regulatory changes are so severe that they make your property worthless.

But the question is even narrower here. An owner of a single plot would be entitled to compensation, becuase the later regulations made their property worthless. An owner of two plots separated by a plot owned by a third plot would be entitled to compensation for both lots on the same basis. It is only becuase this family had two adjacent plots that the government has declared there is no taking because they have to look at the two plots as one.

[7962]

5. Yes, I see your point. Thank you!

[question everything]

6. Interesting that the 3 against are Roberts, Alito and Thomas

Chief Justice John Roberts dissented, joined by justices Clarence Thomas and Samuel Alito. Roberts wrote that he's not troubled by the majority's holding.

"The Murrs can still make good use of both lots, and that the ordinance is a commonplace tool to preserve scenic areas, such as the Lower St. Croix River, for the benefit of landowners and the public alike."

But Roberts took issue with the majority's "ad-hoc, case specific" way of defining property in takings cases, which he felt will give too much advantage to one side.

"Whenever possible, governments in regulatory takings cases will ask courts to aggregate legally distinct properties into one 'parcel,' solely for purposes of resisting a particular claim," he wrote.

He would let state law define the boundaries of parcels in all but the most exceptional circumstances.

https://www.usatoday.com/story/news/nation-now/2017/06/23/supreme-court-rules-wisconsin-family-property-rights/423177001/