Opinion ID: 1800883
Heading Depth: 1
Heading Rank: 7

Heading: Issue 6-a: Whether Chapter 24-17, N.D. C.C., is unconstitutional because it permits the taking of private property for public use without payment of just compensation

Text: The characterization of the State's action as a noncompensable regulation under the police power as opposed to a compensable taking under the power of eminent domain is not susceptible to any easy formulation, but, rather, often turns on differences of degree. Goldblatt v. Hempstead, 369 U.S. 590, 82 S.Ct. 987, 8 L.Ed.2d 130 (1962). Both involve some curtailment of private property rights. In the past, payment of just compensation for a taking was required only when there was an actual physical taking or when the Government asserted a proprietary interest for itself in the owner's property. Mugler v. Kansas, 123 U.S. 623, 8 S.Ct. 273, 31 L.Ed. 205 (1887). More recently, the term taking has been held to include restrictions on the use of property which deprive the owner of all or substantially all of the beneficial use of his property. Penna. Coal Co. v. Mahon, 260 U.S. 393, 43 S.Ct. 158, 67 L.Ed. 322 (1922); Armstrong v. United States, 364 U.S. 40, 80 S.Ct. 1563, 4 L.Ed.2d 1554 (1960). As the United States Supreme Court has said, . . . the mere fact that the regulation deprives the property owner of the most profitable use of his property is not necessarily enough to establish the owner's right to compensation. United States v. Central Eureka Mining Co., 357 U.S. 155, 168, 78 S.Ct. 1097, 1104, 2 L.Ed.2d 1228, 1236 (1958). However, . . . the form of regulation [can] be so onerous as to constitute a taking which constitutionally requires compensation. Goldblatt v. Hempstead, supra, 369 U.S. at 594, 82 S.Ct. at 990, 8 L.Ed.2d at 133. It has generally been held that a reasonable restriction of the use of property pursuant to a State's police power does not constitute a taking of private property for public use requiring payment of just compensation so long as the regulation is reasonably related to a proper purpose and does not unreasonably deprive the property owner of all or substantially all beneficial use of his property. Modjeska Sign Studios, Inc. v. Berle, 43 N.Y.2d 468, 402 N.Y. S.2d 359, 373 N.E.2d 255 (C.A.N.Y.1977); Eldridge v. City of Palo Alto, 57 Cal.App.3d 613, 129 Cal.Rptr. 575 (1976). The question, therefore, is whether Chapter 24-17 is reasonably related to a proper purpose under the State's police power; and, if so, does it nevertheless deprive the owner of all or substantially all of the beneficial use of his property, thus requiring payment of just compensation? Newman argues that Chapter 24-17, N.D.C.C., is an unconstitutional exercise of the police power, in that the Legislature acted unreasonably, arbitrarily, and without a proper purpose. It is a well-established rule of law that an enactment of the Legislature is presumed to be valid, and the presumption is conclusive unless clearly shown to be in contravention of the State or Federal Constitution. Southern Valley Grain Dealers Assn. v. Board of County Commissioners of Richland County, 257 N.W.2d 425 (N.D.1977); Gableman v. Hjelle, 224 N.W.2d 379 (N.D.1974); Horst v. Guy, 219 N.W.2d 153 (N.D.1974). Newman therefore has the burden of coming forward with evidence showing why the enactment is constitutionally defective. The test for determining whether a legislative enactment constitutes an invalid exercise of the police power is stated in Soderfelt v. City of Drayton, 79 N.D. 742, 752, 59 N.W.2d 502, 507 (1953): Statutory enactments and municipal ordinances having for their purpose the protection of the public health, safety, morals and public welfare are founded upon the police power inherent in the state. In passing upon the constitutionality of such statutes or ordinances the courts will not declare them unconstitutional and thus substitute their judgment for that of the legislative body charged with the primary duty and responsibility of determining the question where the question is fairly debatable, that is, unless the statute or ordinances are clearly arbitrary and unreasonable having no substantial relation to the public health, safety, morals or public welfare. See also Village of Euclid, Ohio v. Ambler Realty Co., 272 U.S. 365, 47 S.Ct. 114, 71 L.Ed. 303 (1926). Newman argues that the purpose of the chapter was to avoid the penalty imposed by the Federal law in the event North Dakota did not comply, and that such a purpose is an arbitrary reason for enacting such a law. He argues that the Legislature did not declare a nuisance, did not find any evidence, and did not declare any safety or aesthetic reasons for enacting the law, but instead merely declared that the public interest was at stake. The preamble to the Act explains the purpose of the enactment as follows: Declaring public policy with regard to the regulation of outdoor advertising and the restoration, preservation and enhancement of scenic beauty; . . . 1967 S.L., Chap. 291. The declaration of policy contained in Section 24-17-01, N.D.C.C., states that it is . . . in the public interest reasonably to regulate advertising devices along the highways hereinafter specified while, at the same time, recognizing that both the convenience of travel and the interests of the economy as a whole require a reasonable freedom to advertise. . . . It is further declared to be in the public interest to review all rights now acquired by the state of North Dakota for the use and benefit of the state highway department pertaining to the right and control over the erection, location or maintenance of billboards, signs or any form of advertising adjacent to the state highway system, to determine and designate such areas adjacent to the state highway system as are necessary for the restoration, preservation and enhancement of scenic beauty. . . In addition, Section 24-17-09, N.D.C.C., which sets forth the duties and powers of the Board, specifies that the Board's function includes establishing zoning districts and issuing regulations: 1. For the purpose of promoting the public health, safety, welfare, convenience, enjoyment and recreational value of the public highways, to protect the public investment in the state highway system and to preserve the natural beauty of lands bordering on the state highway system, . . . Thus the Legislature has clearly identified the purposes it intended to achieve by adopting Chapter 24-17, which include restoring, enhancing, and preserving scenic beauty along the Interstate and primary highway systems of the State; promoting the safety and convenience of those traveling on the highways; protecting the public investment in the State highway system; and promoting the enjoyment and recreational value of the State highways. We conclude that these purposes are within the proper scope of the police power of a State. Many courts which have decided cases arising under similar statutes are in agreement. See, e. g., Inhabitants, Town of Boothbay v. National Adv. Co., 347 A.2d 419 (Me.1975); Markham Advertising Company v. State, 73 Wash.2d 405, 439 P.2d 248 (1968), appeal dismissed 393 U.S. 316, 89 S.Ct. 553, 21 L.Ed.2d 512 (1969); Cromwell v. Ferrier, 19 N.Y.2d 263, 279 N.Y.S.2d 22, 225 N.E.2d 749 (1967). Courts which have dealt with the regulation of outdoor advertising signs have often quoted the language of Berman v. Parker, 348 U.S. 26, 33, 75 S.Ct. 98, 102, 99 L.Ed. 27, 38 (1954), as support for the inclusion of such regulation within the concept of the public welfare: The concept of the public welfare is broad and inclusive. . . . The values it represents are spiritual as well as physical, aesthetic as well as monetary. It is within the power of the legislature to determine that the community should be beautiful as well as healthy, spacious as well as clean, well-balanced as well as carefully patrolled. Some courts have recognized that aesthetic considerations alone may form the basis for a valid exercise of the police power. See State v. Diamond Motors, Inc., 50 Haw. 33, 429 P.2d 825 (1967); Oregon City v. Hartke, 240 Or. 35, 400 P.2d 255 (1965); Jasper v. Commonwealth, 375 S.W.2d 709 (Ky.1964); People v. Stover, 12 N.Y.2d 462, 240 N.Y.S.2d 734, 191 N.E.2d 272 (1963); Westfield Motor Sales Co. v. Town of Westfield, 129 N.J.Super. 528, 324 A.2d 113 (1974). We need not decide whether aesthetic considerations alone justify this regulation because the regulation is based upon a combination of purposes which we find to be within the police power. In addition to preserving scenic beauty, the Legislature also recognized safety as a purpose of the chapter. Although some courts have questioned the validity of the assertion that outdoor advertising signs have a detrimental effect on traffic safety, we have been provided with no evidence to indicate that such a relationship does not exist. We agree with the statement of the New York appellate court in Whitmier & Ferris Company v. State, 20 N.Y.2d 413, 284 N.Y.S.2d 313, 315, 230 N.E.2d 904, 905 (1967): If people did not look at the signs, advertisers would not find it profitable to put them there. It was within the competence of the Legislature to determine that the safety of the traveling public is endangered by this distraction of the attention of drivers of automobiles under these circumstances. Exercise of the police power over subjects whose relationship to the public safety is honestly debatable cannot be held unconstitutional by the courts [Citation]. We also conclude that Chapter 24-17, N.D.C.C., does not deprive Newman of all or substantially all of the beneficial use of its property. The Act does provide compensation for lawfully erected signs which, due to the enactment of the statute or the regulations thereunder, become nonconforming. Sec. 27-17-05, N.D.C.C. The North Dakota Act also provides within its statutory scheme an amortization period during which a sign owner is allowed to maintain his sign without its being subject to removal. This type of provision is common in many States and has been upheld against constitutional attack. See, e. g., E. B. Elliott Adv. Co. v. Metropolitan Dade County, 425 F.2d 1141 (5th Cir. 1970); National Advertising Co. v. County of Monterey, 1 Cal.3d 875, 83 Cal. Rptr. 577, 464 P.2d 33 (1970), appeal dismissed 398 U.S. 946, 90 S.Ct. 1869, 26 L.Ed.2d 286 (1970); Webster Outdoor Advertising Co. v. City of Miami, 256 So.2d 556 (Fla.App.1972); Art Neon Co. v. City and County of Denver, 488 F.2d 118 (10th Cir. 1973), cert. denied 417 U.S. 932, 94 S.Ct. 2644, 41 L.Ed.2d 236 (1974); Donnelly Advertising Corp. v. City of Baltimore, 279 Md. 660, 370 A.2d 1127 (1977); Naegle Outdoor Adv. Co. v. Village of Minnetonka, 281 Minn. 492, 162 N.W.2d 206 (1968). Amortization has been found to be a constitutionally acceptable way of compromising the competing interests of private property owners and the public. Use of a reasonable amortization scheme provides an equitable means of reconciliation of the conflicting interests in satisfaction of due process requirements. City of Los Angeles v. Gage, 127 Cal.App.2d 442, 460, 274 P.2d 34, 44 (1954). Newman argues that it is being deprived of the right to engage in a lawful business; however, it is well settled that even a legitimate business may be regulated in the public interest. Johnson v. Elkin, 263 N.W.2d 123 (N.D.1978); Breard v. Alexandria, 341 U.S. 622, 71 S.Ct. 920, 95 L.Ed. 1233 (1951). The chapter does nothing more than regulate one particular future use of property while leaving available to the property owner all other uses. Newman continues to have available the option of erecting and maintaining signs within the confines of the statute. We cannot say, based on the record before us, that the negative restriction placed upon the landowner and thus on his lessee has the effect of depriving Newman of all or substantially all of the beneficial use of his property.