Court Opinion

ID: 9641974
Source: CourtListenerOpinion
Date Created: 2023-08-22 17:44:43.343121+00
Date Added: 2024-06-11T18:10:41.352637
License: Public Domain

RUDKIN, Circuit Judge
(dissenting).
During his lifetime, Judge DIETRICH prepared an opinion in this case reversing the decree of the court below, in which I concurred. For the reasons there stated, I feel constrained to dissent from the majority opinion. The opinion of Judge DIETRICH follows :
“The appellants brought this suit to enjoin the enforcement against them of a zoning ordinance of Los Angeles, prohibiting the drilling for oil within a certain district of the city; they will hereinafter be referred to as the land company and the oil company. The former is the owner and the latter is the lessee of a tract of approximately 290 acres within such district. The lease was given to enable the lessee to explore for oil, and, if oil is found, to extract it. The municipal limits were extended to include a part of the tract, together with other lands, in 1915, and the remainder in 1923. In 1916, the eity adopted a general ordinance zoning its entire territory and prohibiting within the residence zone certain classes of business, -including that of drilling for oil. Originally the tract-in question was not affected thereby, but by amendment on June 15, 1926, the residence zone was enlarged to include it, and thereupon it beeame subject to the restriction. In response to an application made by the land company, the city, on March 31,1927, passed another ordinance exempting a portion of the tract from the restriction and permitting drilling thereon for oil. Immediately following the passage of this ordinance and in reliance thereon, the plaintiffs executed the agreement of lease hereinbefore referred to, and pursuant to the terms thereof • the oil company paid to the land company $75,000. The oil company at once entered upon the property, and, in constructing a road, erecting a derrick with standard equipmerit for *536oil drilling, and securing other leases on adjacent property, it made expenditures aggregating $136,000 — a total outlay upon its part of $211,000. Thereafter, on May 19, 1927, apparently for the purpose of nullifying the permission to drill, another ordinance was passed purporting to place all the property of the land company within the residence district. Whether this ordinance was in reality effective for the purpose, we need not stop to consider, for on August 8, 1927, still another ordinance was passed amending the original ordinance of 1916 by repealing the permissive ordinance of March 31,1927. Thus confronted with a group of ordinances purporting to put an end to their enterprise, the plaintiffs, on. December 9, 1927, commenced this suit, to have them declared ineffective for that purpose and the city officers enjoined from enforcing them. The city answered, and, after hearing the evidence offered, which bears largely upon, the general question of the relation of the restriction to the safety and general welfare of the community, the court below entered a decree denying plaintiffs any relief and dismissing their bill. From the decree so entered, plaintiffs prosecute this appeal.
“Subject to certain constitutional limitations, the governing body of a city, invested with the requisite authority, may divide its territory into residence and other .districts. Euclid v. Ambler Realty Company, 272 U. S. 365, 47 S. Ct. 114, 71 L. Ed. 303, 54 A. L. R. 1016; Zahn v. Board of Public Works, 274 U. S. 325, 47 S. Ct. 594, 71 L. Ed. 1074. If the reasonableness of the classification is fairly debatable, the courts will afford no relief. Id.. But 'the governmental power to ' interfere by zoning regulations with the general rights of a land owner by restricting the character of his use is not unlimited, and other questions aside, such restriction cannot be imposed if it does not bear a substantial relation to the public health, safety, morals,, or general welfare.’ Nectow v. Cambridge, 277 U. S. 183, 188, 48 S. Ct. 447, 72 L. Ed. 842. And a zoning ordinance may be valid in its general scope and plan but violative of constitutional- inhibitions in its application to a specific piece of property. Euclid v. Ambler Realty Company, 272 U. S. 365, 397, 47 S. Ct. 114, 71 L. Ed. 303, 54 A. L. R. 1016; Nectow v. Cambridge, 277 U. S. 183, 48 S. Ct. 447, 72 L. Ed. 842; State of Washington v. Roberge, 278 U. S. 116, 49 S. Ct. 50, 73 L. Ed. 210. Each, case must be adjudged in the light of. its own facts.
“In its extreme limits the territory of the city of Los Angeles extends for a distance of nearly 40 miles from north to south and 20 miles from east to west, and in area embraces approximately 450 square miles. The tract in question lies about 7 miles westerly from what may be regarded as the heart of the city. While, as we have seen, it was annexed partly in 1915 and partly in 1923, no portion of it has ever been subdivided into lots or blocks or used for city purposes; upon it there is but one house, and, with the exception of the oil-drilling enterprise herein involved, it has always been either barren or devoted exclusively to farming purposes. The entire area (approximately 400 acres) covered by the oil company’s leases is measurably compact and may be visualized as a square with a rectangular tract cut out of the northeast comer, the southeast comer, the southwest comer, and the south central portion. Westerly from the northerly section extend country or golf clubs for a distance varying from a quarter of a mile to a mile, and from the southern part the Monte Mar Vista residence tract comprising 100 acres. South of the southwest portion is another country club. Projecting into the leased area from the south for a distance of about 1,200 feet is a strip 300 or 400 feet wide belonging to and occupied by the Pacific Mili-r tary Academy.' For several hundred feet south ..of the southeast portion apparently there are no residences. Easterly and northerly from the leased area, with the exception of the extreme northwesterly portion, the territory is devoted to residential purposes and is occupied to some degree by residences. The oil company’s derrick is located a little more than 100 feet east of the west boundary line of the leased area and about midway north and south. The only residence section in that vicinity is the Monte Mar Vista tract, from the derrick to the nearest point of which is about 500 feet. Upon the tract there are approximately twenty-five residences, the closest one being 1,100 feet from the derrick. To the nearest of the other residence sections it is approximately-half a mile. Upon the Monte Mar Vista tract expenditures aggregating $600,000 have been made in grading, paving, and the construction of other public improvements, and the residences thereon were erected at a cost of approximately $785,000, Neither it nor other nearby residence tracts have sold or built .up rapidly. Witnesses submitted widely diverse estimates, which of necessity are measurably speculative, touching the value of the leased property for residence purposes, .and for oil.
*537“The grounds on which it is sought to justify the prohibition against drilling are (1) that some dust arises from the passing of vehicles to and from the derrick; (2) that the operation of the drill is attended with noise; (3) that, if and when gas is encountered, offensive odors will be emitted; and (4) that in such contingency there will be an additional fire hazard. Unless care is exercised there is possibility of fire in sinking a test well, but, considering the distance to the closest dwelling house or other structure, and assuming due precautions, the hazard in this respect from the well in question is thought to be negligible. While our consideration has to do more particularly with the existing derrick, which is in closer proximity to the Monte Mar Vista tract than is any other point in the plaintiffs’ territory, and the operation of which has been subjected to no public regulations, it is to be borne in mind that the prohibition of the ordinance is absolute and from its operation is not excepted any derrick though it may be located at a much more remote point and operated under strict regulations having for their object the elimination or the reduction to a minimum of the asserted objectionable conditions. The city has not attempted by reasonable regulations to accomplish what it seeks by the absolute prohibition, and thus to preserve a measure, at least, of the value of the property right which it would wholly destroy.
“In two aspects the ease is unusual though not entirely unique. As we have seen, acting in reliance upon the permissive ordinance, the lessee laid out over $200,000 in preparation for drilling. While it is not suggested that the city thus became bound as by a contract, or its officers estopped from any appropriate exercise of the police power, the circumstance is not wholly immaterial. With no intervening change of conditions, we have, as against a finding of necessity, another finding by the same body of no necessity. If the latter does not impair the force of the former, it at least has a tendency to show that the question is not free from great doubt. And, where the citizen has thus been led in good -faith to make large expenditures, his investment should not be destroyed if there is any other reasonable way by which the safety and well-being of the community may fairly be conserved. See Dobbins v. Los Angeles, 195 U. S. 223, 25 S. Ct. 18, 49 L. Ed. 169.
“In the second place, differing from most of the cases whore such controversy has arisen, the ordinance under consideration affects the inherent value of a natural resource which can be utilized only upon the ground. Ordinarily enactments against the conduct of a certain line of business within a defined zone do not destroy the business, for it may be carried on within a district designated for that purpose. True, land values in the restricted zone may thus be affected, but generally such values are not inherent but in the nature of unearned increments; the community is only taking back a part of that which it has contributed, and the property owner is still the beneficiary of a value which not he but the community has created. Not without analogy is Pennsylvania Coal Company v. Mahon, 260 U. S. 393, 43 S. Ct. 158, 159, 67 L. Ed. 322, 28 L. Ed. 1321, involving a statute forbidding the mining of anthracite coal in such a way as to cause, among other things, the subsidence of any structure used as a human habitation. In holding the statute invalid as applied to the particular ease, the court said:
“ ‘Government hardly could go on if to some extent values incident to property could not be diminished without paying for every such change in the general law. As long recognized some values are enjoyed under an implied limitation and must yield to the police power. But obviously the implied limitation must have its limits or the contract and due process clauses are gone. One fact for consideration in determining such limits is the extent of the diminution. When it reaches a certain magnitude, in most if not in all eases there must be an exercise of eminent domain and compensation to sustain the act. * * *
“ ‘It is our opinion that the act cannot be sustained as an exercise of the police power, so far as it affects the mining of coal under streets or cities in places where the right to mine such coal has been reserved. * * To make it commercially impracticable to mine certain coal has very nearly the same effect for constitutional purposes as appropriating or destroying it. This we think that we are warranted in assuming that the statute does. * * *
“ ‘The protection of private property in the Fifth Amendment presupposes that it is wanted for public use, but provides that it shall not be taken for such use without compensation. A similar assumption is made in the decisions upon the Fourteenth Amendment. Hairston v. Danville & Western Ry. Co., 208 U. S. 598, 605, 28 S. Ct. 331, 52 L. Ed. 637, 13 Ann. Cas. 1008. When this *538seemingly absolute protection is found to be qualified by tbe police power, tbe natural tendency of human nature is to extend the qualification more and more until at last private property disappears. But that cannot be accomplished in this way under the Constitution of the United States.
“ ‘The general rule at least is that while property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking. * * *
“ ‘We are in danger of forgetting that a strong public desire to improve the public condition is not enough to warrant achieving the desire by a shorter cut than the constitutional way of paying for the change. As we already have said this is a question of degree — and therefore cannot be disposed of by general propositions. But we regard this as going beyond any of the eases decided by this court.’
“The validity of the distinction we are considering was seemingly recognized in Hadacheck v. Sebastian, 239 U. S. 394, 36 S. Ct. 143, 60 L. Ed. 348, Ann. Cas. 1917B, 927; Id., 165 Cal. 416, 132 P. 584, L. R. A. 1916B, 1248; and was expressly sustained In re Kelso, 147 Cal. 609, 82 P. 241, 2 L. R. A. (N. S.) 796, 109 Am. St. Rep. 178, and in Village of Terrace Park v. Errett, 12 F.(2d) 240, 243. In the latter ease the Circuit Court of Appeals of the Sixth Circuit said: ‘There is also a substantial difference between an ordinance prohibiting manufacturing or commercial business in. a residential district that may be conducted in another locality with equal profit and advantage, and an ordinance that wholly deprives the owner of land of its valuable mineral content.’
“We are unable to escape the conclusion-that, in its absolute prohibition of any and-all drilling operations upon a tract of such magnitude and so situated with respect to-sections actually used for residence purposes,, the ordinance is unnecessarily drastic. To-say the least, the conditions to which we have just referred strongly emphasize the-rule that restriction should not outrun necessity, and that in the legitimate exercise of the police power there must be some reasonable relation between the public good to be sub-served and the private loss entailed. To. what extent the city may restrict the extrae- - tion of oil if it is found we need not at this-juncture consider. The present operation is-exploratory; by it the plaintiff seeks only to determine with certainty whether they have oil. It is not a ‘wild eat’ or ‘stock jobbing’' scheme, but a legitimate enterprise, intelligently undertaken by men of experience in the industry, who, in the large outlay already made, have shown their faith by their works». With reasonable regulations the operation may be continued without substantial injury or menace to the public health, safety, morals, or general welfare, and under such circumstances an absolute prohibition is thought to be arbitrary and unwarranted. If and. when the plaintiffs discover oil, consideration may be appropriately given to the question whether under any mode of operation then known it may be extracted without seriously affecting the health, safety, or well-being pf the community, by setting at large noxious or inflammable gases, or otherwise creating conditions constituting a nuisance.”'