Restatement (SCOTUS) of Property: What Happened to Use in Murr v. Wisconsin?

Abstract

A casual observer of the U.S. Supreme Court’s efforts over the years to formulate a regulatory takings doctrine could be forgiven if they were to conclude that the Justices were simply making things up as they went along. That certainly is the way it feels to some of us who try to apply the Court’s takings rules in actual cases. In most circumstances, a lawyer who attempts to predict their client’s chances is embarking on a fool’s errand, because there is no consistent pattern, unless the lack of consistency is itself a pattern. There are few clear rules, other than it is exceedingly difficult for owners to successfully challenge even those regulations which have devastating impact on the value of their property. The Court’s latest foray into regulatory takings, Murr v. Wisconsin, would not disabuse the observer of that conclusion. I say that because Murr’s rule for what constitutes the “property” against which the owner’s claimed loss is measured in takings cases where the owner possesses more than a single parcel is a confusing stew of mostly undefined factors: the “treatment of the land” under state law, the “physical characteristics” of the properties (which includes the parcels’ topography and “the surrounding human and ecological environment”), and, most strangely, “the value of the property under the challenged regulation.” I will be making three points in this paper. First, the narrow margin of victory in Murr, coupled with the Court’s denial of certiorari only four days later in another case presenting the same question, suggest the Murr factors are hardly set in stone, and could be modified by a different Court majority into a more understandable, practical, and workable rule, one based squarely in state property law. Second, although I won’t spend much time deconstructing the Murr majority’s three-factor test, I suggest that it simply missed what should have been the center of gravity in the case, the “three unities” which state and federal courts regularly apply in eminent domain cases to determine whether the taking of one parcel results in damages to another. Application of this test to determine how much of the claimant’s property constitutes the denominator in regulatory takings cases — asking whether the plaintiff uses multiple parcels together, whether the parcels are titled jointly, and whether they are physically close — would place the emphasis in all takings cases — both straight and regulatory — where it should be: on objectively measurable evidence that the owner uses two or more parcels together as a single economic unit. Finally, I argue that the Supreme Court’s adoption in Murr of a vague, difficult-to-apply test for takings claims under the Fifth and Fourteenth Amendments does not constrain state court from applying the three unities test under their respective state takings provisions. Until there’s a more favorable environment at the Supreme Court, property owners should concentrate their efforts on state law and state courts.