LAND USE LITIGATION: THE LAND USE LAWYER'S TOOLBOX
By Peter D. Cleveland with portions edited by Leslie C. Shively
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I. INTRODUCTION: HOW LAND USE CASES PRESENT THEMSELVES
Land use cases present themselves in a variety of ways, not all, quite naturally, initiated by deliberate and carefully planned action by your client.
One loathsome event is the unexpected or unwelcome governmental initiative. Mr. Lucas, of the now celebrated case, Lucas v. South Carolina Coastal Council, 404 S.E.2d 895 (S.C. 1991), rev. and remanded, 505 U.S. 1003 (1992), encountered this with the 1988 enactment, by the State of South Carolina, of the "Coastal Zone Management Act," which prohibited construction of habitable improvements on two residential lots he purchased for $975,000.00 in 1986. Although a developer arguably aware of the likely future enactment of coastal zone protection laws, Mr. Lucas filed suit in state court, utilizing an inverse condemnation theory and seeking damages for an unlawful "taking" of his property. Could Mr. Lucas have avoided this entanglement by properly reviewing his title and applicable ordinances for use and development restrictions? Could he have sought a permit or variance by administrative action? Or can state action deprive one of use and development rights without regard to one's diligence or the personal impact?
The Court's opinion may have turned on whether "logically antecedent inquiry into the nature of the owner's estate shows that the proscribed use interests were not part of his title to begin with." 505 U.S. at 1027.
In contrast, what can be done when your client is denied a permit? This was the experience of Florida Rock Industries, which in 1972 paid $2,964,000 for 1,560 acres of wetlands area for purposes of limestone mining, only to learn in 1977 that owners of wetlands were required to obtain perits under Section 404 of the Clean Water A , and that the Army Corps of Engineers would not issue such a permit. See Florida Rock Indus., Inc. v. United States, 18 F.3d 1560 (Fed. Cir. 1994) cert. denied, 513 U.S. 1109 (1995). Was Florida Rock's intended use, at the time of its 1972 closing, not a vested property right?
Or, closer to home, what was Mr. Yater to do after new rules and regulations were issued by the Indiana State Board of Health that prohibited him from obtaining permits to use septic tank systems on his 11 remaining lots, even though he had obtained, for three previous years, similar permits for 35 lots in his subdivision? In Yater v. State Board of Health, 677 N.E.2d 526 (Ind. App. 1997), the Court of Appeals denied Mr. Yater?;s petition for mandate, vagueness, and regulatory taking claims. Given Mr. Yater?;s default and his lender?;s foreclosure, where do we find justice? How is one to formulate a business plan and make an investment amid such shifting sands of regulation?
Or, in a contested zoning variance proceeding where you advise your client that if a vote is taken on the petition, the result could be win or lose, do you protect your appeal rights and risk offending the local board members by mentioning the words "constitutional," "takings," or "compensation"? Do you need to do this?
And further, when your client goes to sell or refinance his or her property, and the environmental analysis shows residual but not active gasoline contamination having apparently migrated from the underground storage tanks of the nearby service station, must you notify public authorities? Should you do so prior to engaging the potentially responsible party in settlement discussions or litigation?
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May, 1999 Indiana Continuing Legal Education Seminar Presentation
GO TO MY WEBPAGE AT http://www.tharpinvest.com/law.htm FOR FULL TEXT OF SEMINAR PAPER
Peter D. Cleveland, P.C.
429 N. Pennsylvania Street
Indianapolis, IN 46204