November 11, 2011

An unlikely hero passes

By James S. Burling Vice President for Litigation

Last week, we lost a great freedom-fighter when Anthony Palazzolo died at the age of 91. At first blush, Anthony would seem to be an unlikely hero for a movement rooted in the intellectual traditions of the American Revolution. After all, what does a man who was a tow-truck driver and an owner of “Polly’s Auto Wrecking” have to do with the property rights and the ideals of the Founding Fathers? But after meeting him, it was clear to me that Anthony Palazzolo he had a remarkably clear vision of what James Madison meant when he wrote, “a man is said to have a right to his property, he may be equally said to have a property in his rights.”

Palazzolo purchased about 19 acres of property in the late 1950s. He put the title of the property into a corporation of which Anthony was the sole shareholder. The property was marsh and he tried to get a permit in the 1960s to dredge a nearby pond and use the spoils in order to prepare the property for a subdivision – not really an unusual development style in that era. At this time, in Rhode Island there were no wetlands regulations, but there was a requirement to get a permit to dredge a publicly owned pond. After several tries, he couldn’t get a permit to dredge and Anthony put his dreams aside for a while in order to run his business and raise his family. But he never forgot about his property. He wrote West Publishing Company and asked for everything they had on property rights. And he read it. One of his sons recounts that at the dinner table, where most fathers would talk to their sons about football and sports, Anthony talked about the Magna Carta and the Constitution.

In the meanwhile, Rhode Island adopted in the late 1960s and again in 1971 regulations governing the filling of wetlands. In 1978, figuring there was no point in paying a hundred dollars or so a year to maintain the corporation, Anthony let the corporation lapse, and he now owned the property in his personal capacity. In the 1980s, Anthony again turned his attention to developing his property. This time he sought only to fill it with gravel trucked in from a quarry–he would not dredge the pond. Again he was denied. First for a 72 lot subdivision and then for an 11-acre beach club. Both times he was denied. Most interestingly, the State justified the denial by saying the project failed to serve “a compelling public purpose providing benefits to the public as a whole.”

But, remember, by this time Anthony was a scholar of property rights. He well knew the leading justification for the Fifth Amendment provided in the 1960 Armstrong v. United States decision: “The Fifth Amendment’s guarantee … [is] designed to bar Government from forcing some people alone to bear public burdens which in all fairness and justice should be borne by the public as a whole.”

That was enough to set in motion one of the more significant property rights cases of the past several decades. Rhode Island argued, and it convinced the Rhode Island Supreme Court, that because Anthony acquired the property in his personal capacity–in 1978–which was after the new wetlands regulations were put in place–he had no right to argue that the application of the regulations was a taking. When I read that decision, I threw up my hands figuring it was another sign of the apocalypse that property rights could literally disappear on the sale or transfer of the fee. To his credit, my then-PLF colleague Eric Grant thought the Supreme Court might be convinced to stave off the apocalypse. PLF took over the case, the Court accepted it, and I argued Anthony’s case before the Supreme Court in 2001. Anthony, as one might imagine, was deeply involved in the case. He called me frequently in the course of the Supreme Court litigation with suggestions on legal strategy and tactics. The man knew what he was talking about. He was not any ordinary tow-truck driver.

Anthony was elated when the Court ruled in his favor, with Justice Kennedy writing, among other things, that “[t]he State may not put so potent a Hobbesian stick into the Lockean bundle.” I’m quite sure that very few of my clients would have had a clue what that meant. But Anthony did.

In the end, when the case was remanded to the state courts and he managed only a small victory in light of the state’s argument that the public-trust doctrine limited his ownership rights in most of his property. He could develop a small portion, but not the remainder. Nevertheless, the precedent remains that even after the transfer of regulated property, the State could not “put an expiration date on the Takings Clause.”

Anthony remained a fighter to the end. Recently after learning that a neighbor was encroaching on his property Anthony decided to sue. After being diagnosed with congestive heart failure, he told his doctor to hurry up and heal him because he had to go to court.

America needs more heroes like Anthony Palazzolo who are willing to stand up for what they believe and defend their rights all the way to the Supreme Court. I was honored to have represented Anthony. May his precedent live long after him.

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