What’s On Their Minds? Standing in Regulatory Takings Cases.

Update: On August 30, 2012, the Court handed down a merit decision in Moore v. Middletown. Read the analysis here.

Update: The merit decision in Clifton v. Blanchester was handed down March 1, 2012 . Read the analysis of the decision here.

Both cases argued Sept. 6– Clifton v. Village of Blanchester and Moore et al. v. City of Middletown–involved standing issues in regulatory takings cases. The issue in both cases was whether owners of property outside a municipality can sue for loss of value based on the municipality’s rezoning of adjacent property.

     In Clifton v. Village of Blanchester, a farmer who owned about 99 acres of land sold several acres to J&M Precision Machining, which was in Blanchester. He kept the rest for farming, but planned to sell off his farmland in the future to developers. Blanchester re-zoned J&M Machining from restricted to general industrial to allow J&M to expand.  Clifton argues that the re-zoning defeated his investment-backed expectations. His land won’t be as attractive now as a residential development.  

     In the Moore case, the appellants’ homes in the city of Monroe bordered on property re-zoned by the City of Middletown from the least to the most intensive use, and which reduced the minimum setback requirements from 600 feet to zero to allow the construction and operation of a commercial coke plant. Appellants argued that the re-zoning and elimination of the set-back ordinances were enacted solely to benefit the AK Steel Corporation, one of Middletown’s largest employers

The Clifton Case

The merits of the takings claims

     In the Clifton case, Chief Justice O’Connor, and Justices Pfeifer and Cupp pressed on whether standing was the only issue, or whether the court of appeals had also ruled against Clifton on the merits of whether Blanchester’s acts of rezoning the J&M property amounted to a partial taking of Clifton’s property? The appeals court found that a diminution in property value is not enough to demonstrate a taking.  Justice Pfeifer said he found the appellant’s position “shaky on the merits” because he had done some of this to himself by earlier selling off some of his property to J&M.  So if it was economically unattractive for residential plots to be adjacent to an industrial use, Clifton had partly brought that on himself.

 The specter of limitless liability

     On the standing issue, several of the justices expressed their concerns over limitless liability.  Justice Lanzinger asked if the court were to agree on standing for non-residents, how far out should this go?  To every adjacent property owner? And couldn’t other property owners claim their investment-backed expectations for their property had been defeated? Justice Pfeifer asked whether every disgruntled neighbor would have a takings claim since every zoning case has an effect on neighboring property. In the Moore case, Chief Justice O’Connor asked whether the floodgates had been opened in any other states that allowed standing to contiguous nonresident property owners.

Due Process

     Justices Cupp and Pfeifer noted that Clifton had the opportunity to be heard during the re-zoning process. Wasn’t this a meaningful right of participation in the process?

 The limits of the power of eminent domain

     Justice O’Donnell asked whether the state constitution and R.C. 163.63  preclude a political subdivision from having any takings power outside its territorial boundaries. Justice Lanzinger also pressed counsel in both cases on whether mandamus can lie outside jurisdictional limits. In Moore, she asked by what authority Middletown could take property outside its territorial limits.

 The Ohio Constitution

     Justice Pfeifer—who has been the leader in the new judicial federalism, which is the right of state courts to find greater protection in the area of civil rights and rights of criminal defendants than exist under the federal constitution– asked whether this was a place where greater protection might be found for property owners than exists under federal constitutional law.  Picking up on this, Justice McGee Brown asked the same question in the Moore case.

 The Moore case

A Person’s Home is His or Her Castle?

Justice McGee Brown asked whether when someone’s home is involved, the test for a partial taking should be more than just diminution in value. Were the appellants asking for an exception to the Penn Central test because their home was involved, which implicates different interests from commercial property?  She asked Middletown’s counsel whether the plaintiff didn’t deserve a day in court to challenge the decision.

 Remedies

     Justice Stratton pressed counsel on what relief appellants sought.  Did they want Middletown to buy the property? Couldn’t the appellants bring a nuisance lawsuit if they fail to prevail on this claim? 

 The Coke Plant

     Justice O’Donnell asked what a property owner was to do about a zero set-back line. Justice O’Connor asked whether the coke plant could have been located somewhere else. Justice McGee Brown asked whether other sites were considered.  Justice Pfeifer asked what was being spewed onto the plaintiffs’ property from the plant. Justice Lanzinger asked whether anyone at the hearing spoke against the plant. Justice Pfeifer noted that unlike the Clifton case, where the landowner had put himself into a box, here the plaintiffs just wanted in remain in peace and quiet in their own neighborhood.

Concluding observation 

The justices sounded more sympathetic to the homeowners in the Moore case than to the farmer in the Clifton case.

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One Response to What’s On Their Minds? Standing in Regulatory Takings Cases.

  1. Bart Rosenberg says:

    In real estate, we are told it is caveat emptor. Wouldn’t caveat venditor hold on the other side of the fence? Fair is fair.

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