Lucas v. South Carolina Coastal Council

Supreme Court of the United States, 1992.

505 U.S. 1003, 112 S.Ct. 2886, 120 L.Ed.2d 798.

Johnson, pp. 850-857


Facts: Lucas bought some beachfront property on an island for $975,000 in order to build a residential development.  Two years later, the South Carolina legislature passed a law that made it illegal to develop the land Lucas bought.  Lucas filed suit, claiming that the law constituted a taking of his property without just compensation.  The trial court ruled his in favor and found that the new law deprived Lucas of 100% of the economic value of the land.  The trial court ordered the Council to pay $1.2 million to Lucas.  The Supreme Court of South Carolina reversed, basically saying that the statute served a valuable public purpose and therefore no compensation was required by the Fifth Amendment.  Lucas appealed to the U.S. Supreme Court.


Issue: Did the law’s effect on the economic value of Lucas’s land constitute a “taking” under the Fifth and Fourteenth Amendments requiring “just compensation”?


Rule: NEW RULE!  When the state deprives a property owner of 100% of the economic value of their land for some public purpose, it is a compensable taking unless the use that is being taken away was never part of the title to the land in the first place.  For example, it’s not a taking to deprive the owner of the right to create a nuisance on their land, because that wasn’t part of their property rights anyway.


Analysis: The Court says that there are two clear-cut cases of regulatory “takings”:


1.     Physical occupation of private property

2.     Denial of all economically productive use of private property


This case falls into the latter category.  The Court acknowledges that there are occasions when it will allow such regulation to fall short of a compensable taking.  The only time that happens is if, in effect, the state takes away something the landowner never had in the first place.


It is reasonable for property owners to expect that their property will be restricted in some ways.  One way to look at this is to say that certain implied limitations “inhere” in the title to the land.  The government doesn’t need to compensate for making explicit limitations that were previously implicit.


The Court says that in order for South Carolina to prevail on remand, it must show that common law principles of nuisance and property forbid the intended use of the land.


Conclusion: The judgment of the South Carolina Supreme Court is reversed and the case is remanded.


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