November 12, 2015

PLF asks High Court to overrule procedural rules barring takings cases

By J. David Breemer Senior Attorney

This week, PLF attorneys filed a Petition for Certiorari asking the Supreme Court to review the case of Arrigoni Enterprises LLC v. Town of Durham,  a ten -year regulatory takings dispute arising from a Connecticut town’s denial of a property owner’s development plans. The Petition specifically urges the Court to take the case for the purpose of overruling a 1985 decision, Williamson County Regional Planning Commission v. Hamilton Bank,  473 U.S. 172,  that requires property owners to exhaust state court litigation before challenging oppressive land use regulation in federal courts as an unconstitutional taking of property.

The Williamson County state exhaustion rule has put a tremendous  and unique burden on property owners. Most citizens have a right to seek the protection of a federal court when a local government infringes on federal constitutional rights.  But thanks to Williamson County, property owners who believe they have suffered a taking of their land that violates the U.S.Constitution cannot bring their complaint to a federal court.  It is true that Williamson County promises that property owners can come to federal court after a state court rejects their takings complaint,  but this is not true as a practical matter.   This is because another set of federal procedural rules bars litigants from filing a second suit involving the same dispute if they have already lost a prior suit. When a property owner litigates in state court and gets no relief, the no-second-bite-at -the-apple rule will prevent the plaintiff from taking their case to federal court even though the plaintiff has now done exactly what Williamson County demands (exhaust state court) to obtain a federal court hearing.

This means that those who desire to protect their Fifth Amendment right to just compensation for a taking of property must file their claims in state court or not at all.   At first glance, this may not seem so bad. After all, at least property owners have access to state courts under Williamson County‘s regime, right?  Not so fast.  Government defendants have a right to transfer or “remove”  to federal court any state court case that involves a dispute over federal rights, such as a Fifth Amendment takings case. Consequently, when a property owner files a  takings claim in state court —  the only supposedly available court under Williamson County —  the government can immediately transfer the case  to federal court, where it is improper  under Williamson County because the state court litigation has not been fully exhausted– due to the transfer of the case!

Thus, under Williamson County‘s system for litigating takings claims,  property owners have no reasonable or predictable access to the courts. They cannot file directly in federal court, and they cannot count on state court, because the case may be dragged to federal court, where it is not proper. And the property owners are typically whipped back and forth between courts, resources being drained along the way, before it becomes clear that there is no avenue to vindicate their constitutional rights.  Ten years ago, four Supreme Court justices  criticized the problems caused by Williamson County in San Remo Hotel v. City and County of San Francisco, 545 U.S. 323 (2005) (Rehnquist, C.J., concurring), but  the Court has yet to do anything about it.

Tom Arrigoni and his business, Arrigoni Enterprises, got swept up in Williamson‘s bizzare and unfair procedural maze after the Town denied permits for Arrigoni Enterprises to excavate and build a few light industrial buildings on its land.  Arrigoni initially challenged this denial in Connecticut state court, claiming that the Town’s actions were arbitrary and that they amounted to an unconstitutional taking of Arrigoni’s land without compensation. The state court rebuffed this suit and declined to address the takings allegation.

Arrigoni then went back to the Town and asked for an exception from  the regulations that barred rock processing and crushing on Arrigoni’s land, activities necessary for any development of that land.  When the Town denied this too, Arrigoni sued in federal court, claiming in part that the Town had unconstitutionally taken its land by denying all use of the property.   The decision of the federal district court held that Arrigoni’s takings claim was unripe under Williamson County because Arrigoni should have done more to get state courts to address and deny a claim for just compensation before Arrigoni sued in federal court. On appeal, Arrigoni argued  that the Second Circuit should waive any further state court process required by Williamson County since Arrigoni had already tried state courts and there was no question that the Town’s permit denials were final and lacked any compensation- facts enabling a federal court to decide the takings question. But the Second Circuit’s decision declined to do so, upholding the district court’s dismissal of Arrigoni’s takings claim.Ten years after the Town denied Arrigoni’s permits, it is still waiting for a hearing from a court — any court —  on its claim that the denials caused an uncompensated taking.

With PLF representation, Arrigoni has now asked the Supreme Court to take Arrigoni’s case for purpose of reconsidering and overruling the barriers Williamson County puts in the way of federal takings suits. Arrigoni’s Petition specifically asks the Court to take the case to answer these questions:

1. Whether the Court should reconsider, and then overrule or modify, the portion of Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, 473 U.S. 172, 194 (1985), barring property owners from filing a federal takings claim in federal court until they exhaust state court remedies, when this rule results in numerous jurisdictional “anomalies” and has a “dramatic” negative impact on takings law, San Remo Hotel, L.P. v. City and County of San Francisco, 545 U.S. 323, 351-52 (2005) (Rehnquist, C.J., concurring)?

2. Alternatively, whether federal courts can and should waive Williamson County’s state litigation requirement for prudential reasons when a federal takings claim is factually concrete without state procedures, as some circuit courts hold, or apply the requirement as a rigid jurisdictional barrier, as other circuits hold?

Hopefully, the Court will take Arrigoni’s case, disavow Williamson County as a mistake, and return some semblance of order and fairness to federal takings litigation. This is the only way Tom Arrigoni and his business, and many other property owners subject to excessive land use regulation, will ever get a fair shot in the courts.

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