United States Supreme Court Expands Availability of Federal Court in “Takings” Case

The United States Supreme Court in a decision handed down June 21, 2019, in the case of Rosemary Knick v. Township of Scott has made it easier for plaintiffs to go directly to Federal Court in state and municipal “Takings” cases. The Court, in a 5-4 decision authored by Chief Justice Roberts, has held that a property owner has an actionable Fifth Amendment claim at the moment a governmental entity takes the individual’s property without paying for it. The Court expressly overruled the earlier Supreme Court decision in Williamson County Reg’l Planning Comm’n v. Hamilton Bank of Johnson City, 473 U.S. 172 (1985). This decision represents an important shift in the Court’s attitude towards the doctrine of stare decisis, a long-standing legal doctrine which emphasizes the importance of prior decisions enunciating an applicable rule of law as settled law.

In the Knick case, the Township of Scott, Lackawanna County, Pennsylvania, passed an ordinance requiring that “[a]ll cemeteries … be kept open and accessible to the general public during daylight hours.” Rosemary Knick owned a 90-acre rural property containing a small family graveyard. The Township notified Mrs. Knick that she was violating the ordinance because she did not open it to the public at the times mandated by the ordinance. Mrs. Knick brought an action for declaratory injunctive relief in Pennsylvania Common Pleas Court on the basis that the ordinance effected a taking of her property without compensation. The Township, in response, withdrew the violation notice and stayed enforcement of the ordinance. Consequently, the Lackawanna Common Pleas Court declined to rule on the request for declaratory and injunctive relief on the basis that the absence of an on-going enforcement action prevented Mrs. Knick from demonstrating the requisite irreparable harm necessary for the Court to provide equitable relief. Mrs. Knick then proceeded to commence an action in the United States District Court under the Civil Rights Act of 1871, 42 U.S.C.A. §1983, contending that the ordinance violated the Takings Clause of the Fifth Amendment.

Under Williamson County Reg’l Planning Comm’n v. Hamilton Bank of Johnson City, supra, the Supreme Court had previously held that a property owner must seek just compensation under the applicable state law in state court before bringing a Takings Claim in federal court under §1983. This holding effectively required an exhaustion of state remedies before an injured party could proceed in federal court. The Supreme Court in Knick expressly overruled the decision in Williamson County. Writing for the Court, Chief Justice Roberts observed “We have long recognized that property owners may bring Fifth Amendment claims against the Federal government as soon as their property has been taken.” Thus, the Court held that the Fifth Amendment right to full compensation arises at the time of the taking, regardless of what remedies may be available to the property owner. In Williamson County, the Supreme Court had previously held that a taking does not arise to a Federal Constitutional right to just compensation at that time, but instead gives rise to a claim under the applicable state law. The Supreme Court had concluded that “if a State provides an adequate procedure for seeking just compensation, the property owner cannot claim a violation of the [Takings] clause until it has used the procedure and been denied just compensation.” 473 U.S. at 195.

Not long after the decision in Williamson County, the Court held that the Takings Clause requires that the states provide an avenue for property owners to obtain compensation for temporary takings. See First English Evangelical Church of Glendale v. County of Los Angeles, 482 U.S. 304 (1987). The combined effect of Williamson County and First English was to require that claimants first bring their actions in state court before resorting to the federal courts. The Knick Court noted, however, that an adverse ruling in the state court would likely leave the claimant without any remedy for the Taking.

Chief Justice Roberts continued, “In sum, because a Taking without compensation violates the self-executing Fifth Amendment at the time of the Taking, the property owner can bring a Federal suit at that time.” The Court then turned to the question of whether Williamson County should be overruled or whether the doctrine of stare decisis mandates following the decision as settled law. The doctrine of “stare decisis” embodies the principle that an applicable rule of law, once adopted by the Supreme Court is entitled to great deference in deciding subsequent cases. The doctrine reflects a judgment “that in most matters it is more important that the applicable rule of law be settled than that it be settled right.” Agostini v. Felton, 521 U.S. 203, 235 (1997). Chief Justice Roberts noted that the doctrine of “stare decisis is at its weakest when we interpret the Constitution,” as we did in Williamson County because only [the Supreme] Court or a Constitutional amendment can alter our holdings. Id. He continued, “Williamson County was not just wrong. Its reasoning was exceptionally ill founded and conflicted with much of our takings jurisprudence.” Knick, supra.

Chief Justice Roberts further explained that “just as someone whose property has been taken by the Federal Government has a claim ‘founded …upon the Constitution’ that he may bring under the Tucker Act, someone whose property has been taken by a local government has a claim under §1983 for a ‘depravation of a [right]’ … secured by the Constitution that he may bring upon the taking in Federal Court.” Id. Thus, a property owner whose property is taken by the acts of a state or local municipal government has the right to immediately proceed with its Constitutional claim under §1983 without first bringing any state court proceeding, even when a state court action is available to address the underlying behavior, such as a state eminent domain statute.

Justice Kagan, in her dissent, has observed, “The majority today holds, in conflict with precedent after precedent, that a government violates the Constitution whenever it takes property without advance compensation—no matter how good its commitment to pay. That conclusion has no basis in the Takings Clause. Its consequence is to channel a mass of quintessentially local cases involving complex state-law issues into federal courts. And it transgresses all usual principles of stare decisis.” Knick, supra.

The ease with which the Supreme Court rejected its prior precedent in Williamson County may very well presage the philosophy of a majority of the current Justices that they are not necessarily bound by prior Supreme Court precedent under the doctrine of stare decisis. This decision opens the doors of the federal courts to property owners and developers who claim that that they have been deprived of the use of their property by the actions of municipal officials, whether it be by a direct taking or condemnation, or by indirect action such as inverse condemnations. The Knick decision represents a significant shift in the playing field upon which state and local Takings are to be determined. It is expected that many developers and property owners who are adversely affected by actions of local municipal officials will resort to the filing of §1983 actions in the federal courts in the first instance and seek the recovery of attorneys fees and costs available under §1983 rather than the statutory fees and costs available under state eminent domain statutes. It also signals the beginning of a judicial philosophy of a majority of the Supreme Court justices that they are not necessarily bound to follow long-standing and well-settled law on other important social issues.