Evaluating Emergency Takings: Flattening the Economic Curve

Abstract

Desperate times may breed desperate measures, but when do those desperate measures undertaken during emergencies trigger the Fifth Amendment’s requirement that the government provide just compensation when it takes private property for public use? The answer to that question has commonly been posed as a choice between the “police power” — a sovereign government’s power to regulate and restrict property’s use in order to further the public health, safety, and welfare — and the eminent domain power, the authority to seize private property for public use with the corresponding requirement to pay compensation. But that should not be the question. An invocation of police power does not answer the compensation question at all, but is merely the predicate issue: all government actions must be for the public health, safety, or welfare, in the same way that an exercise of eminent domain power must be for a public use. In “normal” times, it is very difficult to win a regulatory takings claim for compensation. In the midst of emergencies — real or perceived — the courts are even more reluctant to provide a remedy, even where they should, and emergencies are a good time to make bad law, especially takings law. This article provides a road-map for analyzing these questions, hoping that it will result in a more consistent approach to resolving claims for compensation that arise out of claims of emergencies — real or perceived. This article analyzes the potential takings claims stemming from emergency measures, mostly under current takings doctrine. What type of claims are likely to succeed or fail? Can a better case be made analytically for compensation? Part I summarizes the economic “flattening the curve” principle that motivates takings claims for compensation. Part II sets out the prevailing three-factor Penn Central standard for how courts evaluate claims that a health, safety, or welfare measure “goes too far,” and requires compensation as a taking, examining the character of the government action, the impact of the action on the owner, and the extent of the owner’s property rights. Deep criticism of Penn Central is beyond the scope of this article, and I will not here do more than accept it as the “default” takings test. But I do argue that the government’s motivation and reason for its actions — generally reviewed under the “rational basis” standard — should not be a major question in takings claims. Rather, as this article argues in Part III, the government’s emergency justifications should be considered as part of a necessity defense, and not subject to the low bar of rational basis, but a more fact and evidence driven standard of “actual necessity.” Part IV attempts to apply these standards and examines the various ways that emergency actions can take property for public use: commandeering, occupations of property, and restrictions on use. I do not conclude that the approach will result in more (or less) successful claims for compensation, merely a more straightforward method of evaluating emergency takings claims than the current disjointed analytical methods. In sum, this article argues there is no blanket immunity from compensation simply because the government claims to be acting in response to an emergency, even though its reasons and actions may satisfy the rational basis test. Instead, claims that the taking is not compensable because of the exigency of an emergency should only win the day if the government successfully shows that the measure was actually needed to avoid imminent danger posed by the property owner’s use, and that the measure was narrowly tailored to further that end.