Prop­erty rights splits high court

Case has wide in­ter­est in U.S.

Northwest Arkansas Democrat-Gazette - - NATIONAL - SAM HANANEL

WASH­ING­TON — The Supreme Court on Mon­day ap­peared di­vided over a prop­erty-rights dis­pute whose rul­ing, if in fa­vor of the plain­tiff, would af­fect state and lo­cal govern­ments try­ing to limit devel­op­ment in coastal ar­eas.

The case in­volves a fam­ily’s ef­fort to sell part of its river­front land in Wis­con­sin. The fam­ily planned to use the money from a va­cant lot they own to pay for im­prove­ments on a cabin that sits on the par­cel next door.

But county of­fi­cials blocked the sale for vi­o­lat­ing lo­cal con­ser­va­tion rules and treated the lots as a sin­gle prop­erty that can’t be split up. The fam­ily says that’s un­fair and claims the gov­ern­ment should pay what the va­cant par­cel is worth — up to $400,000. The gov­ern­ment ar­gues that when viewed as a whole, the land re­mains quite valu­able and the fam­ily is owed noth­ing.

The case has drawn in­ter­est from prop­erty-rights and busi­ness groups that say such rules let the gov­ern­ment avoid pay­ing landown­ers for re­strict­ing land use. The Con­sti­tu­tion re­quires com­pen­sa­tion if reg­u­la­tions take away a prop­erty’s eco­nomic value.

Dur­ing a one-hour ar­gu­ment, the court’s four lib­eral jus­tices seemed to side with state and lo­cal of­fi­cials, while con­ser­va­tive jus­tices were gen­er­ally more skep­ti­cal. Jus­tice An­thony Kennedy — of­ten a swing vote in close cases — asked tough ques­tions of both sides.

The court’s rul­ing could af­fect more than 100 cities and coun­ties across the U.S. that have sim­i­lar “merger” re­stric­tions.

The Murrs’ lawyer, John Groen, told the jus­tices that the lots should be viewed as “in­de­pen­dent, dis­crete, and sep­a­rate parcels” be­cause that is how they orig­i­nally were drawn up and have been taxed for years.

But Jus­tice Elena Ka­gan said the Murrs seem to rely on state law as it orig­i­nally drew up the prop­erty lines, yet ig­nore re­vi­sions to the law that treat side-by-side lots as a sin­gle par­cel if they have the same owner.

“If we’re look­ing to state law, let’s look to state law, the whole ball of wax,” Ka­gan said.

Wis­con­sin Solic­i­tor Gen­eral Misha Tseytlin ar­gued that the two lots “have merged for all rel­e­vant pur­poses un­der state law.” He said state of­fi­cials also con­sid­ered the rea­son­able ex­pec­ta­tions of the prop­erty own­ers.

Chief Jus­tice John Roberts said it seemed “a lit­tle quirky” that the Murrs can’t treat the prop­er­ties separately but that if they had pur­chased them un­der sep­a­rate namesm they would be in “an en­tirely dif­fer­ent sit­u­a­tion.”

The case be­gan in 2004, when four sib­lings in the Murr fam­ily wanted to sell the va­cant lot on the banks of the St. Croix River. Their fa­ther had pur­chased the two 1.25-acre lots separately in the 1960s. They were later trans­ferred to his chil­dren in the 1990s.

County of­fi­cials block­ing the sale point to reg­u­la­tions passed in 1976 that bar new con­struc­tion on lots in the area to pre­vent over­crowd­ing and pol­lu­tion. A “grand­fa­ther” clause ex­empted ex­ist­ing own­ers. But the county won’t ap­ply that ex­emp­tion to the Murrs’ empty lot alone, since it is con­nected to the fam­ily’s other land.

A Wis­con­sin ap­peals court sided with the county, say­ing zon­ing rules did not take away the prop­erty’s value be­cause the Murrs could still use both lots as a va­ca­tion prop­erty or sell them as a whole.

The county ar­gues that a rul­ing against it would un­der­mine its abil­ity to min­i­mize flood dam­age and main­tain prop­erty val­ues in the area. It ar­gues that the fam­ily has treated both parcels as a sin­gle lot and says they could build a new home on ei­ther lot.

Kennedy crit­i­cized lawyers on both sides. He said the fam­ily’s ar­gu­ment seemed to ig­nore “mar­ket fac­tors.” But he also said the state should have to con­sider “the rea­son­able in­vest­ment-backed ex­pec­ta­tions of the owner.”

The high court took up the case more than a year ago but waited sev­eral months be­fore sched­ul­ing ar­gu­ments. Prop­erty-rights is­sues of­ten di­vide the high court along ide­o­log­i­cal lines, and the de­lay prompted spec­u­la­tion that the jus­tices were wait­ing for a ninth jus­tice to join them.

Yet only eight jus­tices heard the case Mon­day, the same day that con­fir­ma­tion hear­ings be­gan for Supreme Court nom­i­nee Neil Gor­such. He could be con­firmed in time to sit for ar­gu­ments in April.

A rul­ing is ex­pected by June.

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