March 20, 2012

20 years of Pacific Northwest victories: fighting for a coherent regulatory takings test

By Brian T. Hodges Senior Attorney

At the time PLF opened its office in the Pacific Northwest, Washington’s courts had adopted an extremely pro-regulation and anti-property rights stance toward regulatory takings law.  This was primarily due to the fact that the courts were operating under the notion that any regulation of private property that is designed to protect people from harm is exempt from the protections guaranteed by the Takings Clauses of the State and U.S. Constitutions.  This resulted in shocking decisions, like Orion Corp. v. State of Washington, in which the court held that the government has almost limitless authority to deprive a person of his or her rights in private property so long as the government does not confer a benefit to the public.

PLF immediately set out to change the courts’ understanding of regulatory takings law.  One of the first major victories was the 1993 case, Guimont v. Clarke.  This case marks the court’s first step away from its pro-regulation stance and toward a more coherent and predictable understanding of the Constitution.

In Guimont, owners of mobile home parks challenged the constitutionality of a state law that required the property owners to pay their tenants a relocation fee when a mobile home park is closed.  The park owners argued that the statute either effected a regulatory taking or violated their substantive due process rights.  The court agreed and struck down the regulation as being unduly oppressive in violation of the park owners’ substantive due process rights.

What makes this case particularly interesting from a historic perspective is its discussion of the test the court had developed to determine when a regulation effects a taking of private property.  Prior to Guimont, the courts asked, as a threshold test, whether the regulation was “harm protecting” or “benefit conferring” in nature.  Regulations intended to protect against harm could not be analyzed as a regulatory taking; they could only be challenged as violating substantive due process.  According to the court’s test, the Takings Clause only protected against regulations that conferred a benefit on the public.  This was wrong, and deprived countless property owners of their fundamental rights to property.

PLF filed an amicus brief explaining that the question whether a regulation is “harm protecting” or “benefit conferring” is in the eye of the beholder.  PLF argued that the Washington court should follow the U.S. Supreme Court, which held in Lucas v. South Carolina Coastal Council that the “harm-versus-benefit” line of inquiry cannot serve as a touchstone to determine whether a regulatory taking has occurred.  Accordingly, the Washington court abandoned the “harm-versus-benefit” question as a threshold inquiry (the court did, however, retain the question for several years as part of a balancing test for ad hoc takings).  In its place, the court adopted the threshold question whether the regulation destroys or derogates a fundamental attribute of property ownership.

Although Guimont retained some of the unnecessary confusion engendered in years of Washington’s regulatory takings case law, it represents an important first step toward a regulatory takings test that protects property rights.  PLF continues this fight in cases such as Thun v. City of Bonney Lake and others.

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