Court Opinion

ID: 9471902
Source: CourtListenerOpinion
Date Created: 2023-08-05 03:43:43.531383+00
Date Added: 2024-06-11T17:42:38.014679
License: Public Domain

WELLFORD, Circuit Judge,
dissenting.
I would agree with the majority’s conclusion that “the Supreme Court has not set forth a clear standard by which to determine whether particular conduct amounts to a ‘taking’ under the fifth amendment.”1 I would also agree with its conclusion that “the purpose served by the Planning Commission’s actions now in dispute ... [is] ... a legitimate public purpose.” It seems clear that depriving the owner of the most profitable use of land and the fact that governmental planning or zoning action substantially diminishes the value of land does not amount to a taking. Penn Central Transp. Co. v. New York City, 438 U.S. 104, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978); Euclid v. Ambler Realty Co., 272 U.S. 365, 47 S.Ct. 114, 71 L.Ed. 303 (1926).
The testimony of the Bank’s expert, Hunt, in this case was that if the Planning Commission’s actions, as interpreted by the Bank’s employee (Ragsdale) would admit only 67 additional building sites on the contested property, and would eliminate 409 potential building sites from the development plan, there would be a loss in excess of $1,000,000 to the developer. Hunt was of the opinion, based on this assumption, *410that the property would have no significant market value “other than that which someone would pay for open space.” Examination of the record before us, however, indicates that it was virtually conceded that even applying 1979 standards a total 548 units would be approved on the property. Thus, the elimination of 409 potential units would leave a substantial number yet to be developed. There was no evidence of a formal request by appellant for a variance to permit as many as 267 additional allowable dwelling units for future development as set out on the original 1973 preliminary plat and approved by the Planning Commission on later occasions; rather, appellant insisted that it had vested rights to develop 409 (or more) potential units. In sum, evidence in the case does not clearly indicate to me that economically viable use of the property was denied.
Even if the jury verdict in this case did establish a temporary deprivation and a denial of economically viable use of a part of the property, as apparently the district judge concluded that it did, I would agree with his ultimate holding that “... the temporary interference with the plaintiff’s development backed expectations and any temporary dimunition in value of the property, whether styled as a ‘temporary taking’ or otherwise, ... is essentially a question of law.” He concluded that under the circumstances plaintiff was not entitled to damages as a matter of law since it could proceed under 1973 zoning regulations by reason of estoppel. Defendants, moreover, have insisted all along that plaintiff has never been in compliance with the 1973 zoning laws and regulations pertaining to allowable slope (building on a lot in excess of 25 degree slope not permitted) and with respect to some reduction of allowable units on the property because of elimination of some of the acreage by reason of its acquisition by a public authority for other purposes.
This case is really a quarrel over to what extent a “cluster” development of residential units is permitted on a parcel of land. The zoning ordinances or regulations on their face do not amount to a taking of the Bank property, which was acquired with notice of the application of these ordinances and regulations made by defendants. Agins v. City of Tiburon, 447 U.S. 255, 100 S.Ct. 2138, 65 L.Ed.2d 106 (1980). I agree with the trial judge’s conclusion that there has not been any taking requiring judgment under the Fifth Amendment.
Even if the appellants’ ability to sell their property was limited during the pendency of the condemnation proceeding, the appellants were free to sell or develop their property when the proceedings ended. Mere fluctuations in value during the process of governmental decision-making, absent extraordinary delay, are “incidents of ownership. They cannot be considered as a ‘taking’ in the constitutional sense.” Danforth v. United States, 308 U.S. 271, 285 [60 S.Ct. 231, 236, 84 L.Ed. 240] (1939). See Thomas W. Garland, Inc. v. City of St. Louis, 596 F.2d 784, 787 (CA 8), cert. denied, 444 U.S. 899 [100 S.Ct. 208, 62 L.Ed.2d 135] (1979); Reservation Eleven Associates v. District of Columbia, 136 U.S. App.D.C. 311, 315-316, 420 F.2d 153, 157-158 (1969); Virgin Islands v. 50.05 Acres of Land, 185 F.Supp. 495, 498 (V.I.1960); 2 J. Sackman & P. Rohan, Nichols’ Law of Eminent Domain § 6.13[3] (3d ed. 1979).
Agins, n. 9 at 263, n. 9 100 S.Ct. at 2143.
The judgment of the California Supreme Court in Agins that the sole remedies available in an inverse condemnation claim, arising out of zoning activity similar to that made by the Bank here, were mandamus and declaratory judgment, was not disturbed by the United States Supreme Court.
There has been no physical invasion by defendants of plaintiff’s property, either temporary or permanent. A “taking” of the property can be less readily found under these circumstances. Penn Central Transp., 438 U.S. at 124, 98 S.Ct. at 2659; Loretto v. Teleprompter, supra.
More importantly for the present case, in instances in which a state tribunal *411reasonably concluded that “the health, safety, morals, or general welfare” would be promoted by prohibiting particular- contemplated uses of land, this Court has upheld land-use regulations that destroyed or adversely affected recognized real property interests. See Nectow v. Cambridge, 277 U.S. 183, 188 [48 S.Ct. 447, 448, 72 L.Ed. 842] (1928). Zoning laws are, of course, the classic example, see Euclid v. Ambler Realty Co., 272 U.S. 365 [47 S.Ct. 114, 71 L.Ed. 303] (1926) (prohibition of industrial use); Gorieb v. Fox, 274 U.S. 603, 608 [47 S.Ct. 675, 677, 71 L.Ed. 1228] (1927) (requirement that portions of parcels be left unbuilt) ____
Penn Central Transp. Co., at 125, 98 S.Ct. at 2659.
The Supreme Court in Agins did not decide whether the state (or defendants in this case acting as agents of the state) must pay damages to a landowner when claiming a taking under a regulatory ordinance, because it found no taking had been established. That same issue arose in San Diego Gas & Elec. Co. v. City of San Diego, 450 U.S. 621, 101 S.Ct. 1287, 67 L.Ed.2d 551 (1981), and Justice Blackmun, writing for the majority, stated, “we again must leave the issue undecided.” 450 U.S. at 623, 101 S.Ct. at 1289, and see n. 9 at 629, 101 S.Ct. n. 9 at 1292. I do not interpret Justice Rehnquist’s concurring opinion in San Diego as adopting the reasoning of the minority four Justices in that case, that a temporary taking by reason of regulatory actions pursuant to zoning ordinances should be viewed in the same fashion as a permanent taking. Justice Rehnquist states only: “I would have little difficulty in agreeing with much of what is said in the dissenting opinion of Justice Brennan.” 450 U.S. at 633, 101 S.Ct. at 1294 (emphasis added). See also, Loretto v. Teleprompter, supra, wherein the majority2 pointed out:
The court concluded [in United States v. Central Eureka Mining Co., 357 U.S. 155, 78 S.Ct. 1097, 2 L.Ed.2d 1228 (1958) ] that the temporary though severe restriction on use of the mines was justified
102 S.Ct. at 3174.
The Supreme Court seems to imply that in a temporary taking where there is no invasion, physical occupation, or “seizure and direction” by the state of the landowner’s property, no compensation is mandated. Central Eureka is cited, as apparently still good law in Teleprompter, 102 S.Ct. at 3174. In Hadacheck v. Sebastian, 239 U.S. 394, 36 S.Ct. 143, 60 L.Ed. 348 (1915), where 87 V2% of value was taken by an ordinance precluding existing use, no compensation was found due.
Even if the trial judge reached his decision that compensatory damages were not allowable on the rationale that the zoning regulations were being applied in a manner inconsistent with Tennessee law, I would conclude that he, nevertheless, reached the right decision. Properly considered, there was questionable evidence in this case, at best, that all economically viable uses of the property had been even temporarily taken, or that reasonable “investment-backed expectations” had been arbitrarily eliminated. Plaintiff succeeded, moreover, in obtaining a declaratory judgment and injunction requiring that 1973 ordinances and regulations apply to future development of its property. I would not disturb the district court’s decision in that respect.
In summary, I would conclude that the effects of defendants’ actions did not “completely deprive the owner of all or most of [its] interest in the property.” San Diego, 450 U.S. at 653, 101 S.Ct. at 1304. See, Goldblatt v. Town of Hempstead, 369 U.S. 590, 82 S.Ct. 987, 8 L.Ed.2d 130 (1962). I would conclude further that even a temporary deprivation of the Bank’s “investments-backed expectations” under the circumstances here does not establish an entitlement to compensatory damages. I do not agree that Justice Brennan’s dissent in San Diego represents the views of a majority of the Supreme Court on this issue. *412The majority has not cited a single case allowing compensatory damages in a case where there has been a temporary interference with a landowner’s right to develop his property in some economically viable fashion by reason of zoning actions, not involving an invasion of the property, occupation of it, or temporary seizure and possession of it.
Cases cited by the majority do not, in my view, support the result which they reach. Urbanizadora Versalles, Inc. v. Rivera Rios, 701 F.2d 993 (1st Cir.1983), for example, held that a landowner whose property had been completely frozen by state zoning and regulatory actions, was entitled to declaratory and injunctive relief, but not to compensatory damages. Rogin v. Bensalem Township, 616 F.2d 680 (3d Cir.1980), held that no taking at all had occurred. Kimball Laundry Co. v. United States, 338 U.S. 1, 69 S.Ct. 1434, 93 L.Ed. 1765 (1949); United States v. General Motors Corp., 323 U.S. 373, 65 S.Ct. 357, 89 L.Ed. 311 (1945), and United States v. Petty Motor Co., 327 U.S. 372, 66 S.Ct. 596, 90 L.Ed. 729 (1946), all involved condemnation actions by the federal government for complete temporary taking of a fee, or a leasehold, or part of a leasehold. All are inapposite here. United States v. Causby, 328 U.S. 256, 66 S.Ct. 1062, 90 L.Ed. 1206 (1946), involved the setting aside of a Court of Claims award for a taking because of airplane overflights. The pertinent holding in Hernandez v. City of Lafayette, is as follows:
However, in cases such as the one before us, where the application of a general zoning ordinance to a particular person’s property does not initially deny the owner an economically viable use of his land, but thereafter does come to a result in such a denial due to changing circumstances, or where a zoning classification initially denies a property owner an economically viable use of his land, but the owner delays or fails to timely seek relief from such a classification, [by petitioning for rezoning, or contesting the initial general zoning regulation prior to its passage] we conclude that a “taking” does not occur until the municipality’s governing body is given a realistic opportunity and reasonable time within which to review its zoning legislation vis-a-vis the particular property and to correct the inequity.
During the pendency of such proceedings to review and correct a zoning classification that denies an owner any economically viable use of his property, “[m]ere fluctuations in value during the process of governmental decisionmaking, absent extraordinary delay, are ‘incidents of ownership. They cannot be considered as a “taking” in the constitutional sense.’ ” Agins v. City of Tiburon, 447 U.S. at 262-63 n. 9, 100 S.Ct. at 2142-43 n. 9 (quoting Danforth v. United States, 308 U.S. 271, 285, 60 S.Ct. 231, 236, 84 L.Ed. 240 (1939). Accord, Thomas W. Garland, Inc. v. City of St. Louis, 596 F.2d 784, 787 (8th Cir.), cert. denied, 444 U.S. 899, 100 S.Ct. 208, 62 L.Ed.2d 135 (1979); Reservation Eleven Associates v. District of Columbia, 420 F.2d 153, 157 (D.C.Cir.1969).
643 F.2d 1188 (5th Cir.1981), cert. denied, 455 U.S. 907, 102 S.Ct. 1251, 71 L.Ed.2d 444 (1982) , aff'd after remand, 699 F.2d 734 (1983).
In a footnote, the court further stated: We believe that such a rule is consistent with the “weight of authority ... that in order to constitute a taking, the condemnor must have an intention to appropriate ____” Porter v. United States, 473 F.2d 1329, 1336 (5th Cir.1973). Accord, J.J. Henry Co. v. City State [188 Ct.Cl. 39], 411 F.2d 1246, 1249 (1969). The City of Lafayette under the circumstances of this case would lack an intention to deny plaintiff an economically viable use of his property until it was put on notice that its zoning regulations were effecting such a denial. But see San Diego Gas & Electric Co. v. City of San Diego, 450 U.S. 621, 657 [101 S.Ct. 1287, 1307, 67 L.Ed.2d 551] (1981) (Brennan, J., dissenting).
*413Thus, for the reasons stated, I respectfully dissent from the opinion of the majority and would affirm the decision of the district judge.

. "There is no set formula to determine where regulation ends and taking begins.” Goldblatt v. Town of Hempstead, 369 U.S. 590, 594, 82 S.Ct. 987, 990, 8 L.Ed.2d 130 (1962), cited by the dissent in Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419, 102 S.Ct. 3164, 3179, 73 L.Ed.2d 868 (1982).

. Justice Brennan, dissenting; Justice Rehnquist with the majority.